______________________________________________________________________________
 
CREDIT AGREEMENT
 

 
dated as of
 
October 20, 2010
 

 
among
 

 
KENEXA TECHNOLOGY, INC.
 

 
The Several Lenders From Time to Time
 
Parties Hereto,
 

 
PNC BANK, NATIONAL ASSOCIATION,
 
as Administrative Agent and Issuing Bank
 
____________________________________________________________________________
 
and

PNC CAPITAL MARKETS LLC, as Lead Arranger

 

 
1

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

 

TABLE OF CONTENTS
 
 

 SECTION 1. DEFINITIONS  Page  1.1  Defined Terms  7  1.2  Other Definitional
Provisions   33        SECTION 2. LOANS AND TERMS OF COMMITMENTS    2.1
 Commitments 
 34  2.2  Notes   34  2.3  Procedue for Revolving Credit Loans and Term Loans
 35  2.4  Letter of Credit Subfacility  36  2.5  Swing Line Loans  41  2.6
 Interest and Payment Dates  43  2.7  Default Interest  43  2.8  Conversion and
Continuation Options; Limitations on Tranches   44
 2.9
 Fee  45  2.10  Termination and Reduction of Revolving Credit Commitments  46
 2.11  Optional and Mandatory Prepayments of Loans  48  2.12  Illegality  50
 2.13  Requirityements of Law  50  2.14  Taxes  51  2.15  Indemnity  51  2.16
 Treatment of Loans and Pavments  52  2.17  Payments  52  2.18  Loan Accounts
 53  2.19  Assignment of Loans and/or Revolving Credit Commitments Under 
Certain Circumstances; Duty to Mitigate   53  2.20  Use of Proceeds  54  2.21
 Defaulting Lenders  54

 

 
 
2

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

 

 

 SECTION 3. REPRESENTATIONS AND WARRANTIES  Page 3.1  Corporate Existence  57
3.2  Subsidiaries  57  3.3  Authority and Binding Effect  57 3.4
 Approvals
 57 3.5  Recording and Enforceability  58 3.6  Litigation  58 3.7  Financial
Information  58 3.8  Taxes  58 3.9  Intellectual Property  59 3.10
 Intentionally Ommitted  59 3.11  Material Agreements  59
3.12
 Compliance With Law  59 3.13  Title to Property  59 3.14  Security Interests
 60 3.15  Federal Regulations  60 3.16  ERISA  60 3.17  Fictitious Names
 61
3.18  No Event of Default  61 3.19  Solvency  61 3.20  Investment Company Act
 61 3.21  Environmental Matters  61 3.22  Labor Matters  62 3.23  Anti-Terrorism
Laws  62 3.24  Salary.com Acquisition  63 3.25  No Burdensome Agreements  63
3.26  No Misrepresentations or Material Nondisclosures  63    
SECTION 4. CONDITIONS PRECEDENT
  4.1   Conditions to Closing  64 4.2  Conditions to Each Loan or Letter of
Credit  67 4.3  Closing  67

 
 
 
 
3

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

 
 

SECTION 5. AFFIRMATIVE COVENANTS
 Page 5.1  Furnishing Financial Statements   68 5.2  Books and Records  70 5.3
 Taxes  70 5.4
 Corporate Existence and Rights;  Compliance with Laws
 71 5.5  Maintenance of Properties  71 5.6
 Performance and Compliance with Material Agreements 
 71 5.7  Insurance  71 5.8  Inspection; Collateral Audit  72 5.9  Leases and
Mortgages  72 5.10  Pay Indebtedness and Perform Other Covenants  72 5.11
 Notices  73
5.12
 Deposit Accounts  73 5.13  ERISA  74 5.14  Enviromental Laws  75 5.15  Notice
and Joinder of New Subsidaries  75 5.16  Anti-Terrorism Laws  76 5.17  Hedge
Agreements  76      
SECTION 6. NEGATIVE COVENANTS
  6.1  Financial Covenants  77 6.2
 Limitation on Indebtedness 
 77 6.3  Limitation on Liens  78 6.4  Limitations on Fundamental Changes   79
6.5  Limitations on Sale of Assets   80 6.6  Limitations on Acquisitions and
Other Investments   80 6.7  Limitation on Distributions   81 6.8  Transactions
with Affiliates   81 6.9  Sale and Leaseback   81  6.10  Continuation of or
Change in Business   81  6.11  Limitation on Negative Pledge   81  6.12
 Limitation on Optional Prepayment of Indebtedness   82  6.13  Use of Proceeds
 82  6.14  Fiscal Year  82  6.15  Clauses Restricting Subsidiary Distrubutions
 82  6.16  Limitations on Activites of the Parents   82  6.17  No
Misrepresentations or Material Nondisclosure   82  6.18  Limitation on Assets of
Certain Subsidiaries   82      
SECTION 7. EVENTS OF DEFAULT
   7.1  Events of Default   83  7.2  Remedies   85

 

 
 
4

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

 

 

 
SECTION 8. THE ADMINISTRATIVE AGENT
 Page 8.1  Appointment  86 8.2  Delegation of Duties  86 8.3   Exculpatory
Provisions  86 8.4
 Reliance by Administrative Agent 
 86 8.5  Notice of Default   87 8.6  Non-Reliance on Administrative Agent and
Other Lenders   87 8.7  Indemnification   87 8.8  Agents in Their Individual
Capacity  88 8.9  Release of Liens  88 8.10  Successor Administrative Agent  88
8.11  USA Patriot Act  89
8.12
 Beneficiaries  89 8.13  Lead Arranger  89      
SECTION 9. MISCELLANEOUS
  9.1  Amendments and Waivers  90 9.2  Notices  91 9.3  No Waiver; Cumulative
Remedies  92 9.4  Survival of Representations and Warranties  92 9.5  Payment of
Expenses and Taxes  93 9.6  Successors and Assigns  94 9.7  Adjustments; Set-off
 98 9.8  Counterparts  98 9.9  Severability  98 9.10  Integration  99 9.11
 GOVERNING LAW  99 9.12  Confidentiality  99  9.13   Submission To Jurisdiction;
Waivers  99 9.14  Acknowledgements  100 9.15  USA PATRIOT ACT  100  9.16
 WAIVERS OF JURY TRIAL   100

 

 

 
5

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

 
 
SCHEDULES
 

 SCHEDULE I  Lender and Commitment Information  SCHEDULE II  Existing Letters of
Credit  SCHEDULE III  Existing Permitted Investments  SCHEDULE 2.1 (b)  Term
Loan Amortization Schedule  SCHEDULE 3.2  Subsidiaries  SCHEDULE 3.6  Litigation
 SCHEDULE 3.9  Intellectual Property Challenges  SCHEDULE 3.11  Material
Agreements  SCHEDULE 3.14  Filing Locations  SCHEDULE 3.16  ERISA Matters
 SCHEDULE 3.17  Fictitious Names  SCHEDULE 3.22  Labor Matters  SCHEDULE 6.2
 Existing Indebtedness  SCHEDULE 6.3  Existing Liens

 

EXHIBITS
 

 EXHIBIT A-1  Form of Revolving Credit Note  EXHIBIT A-2  Form of Term Note
 EXHIBIT A-3  Form of Swing Line Note  EXHIBIT B  Form of Notice of Borrowing
 EXHIBIT C  Form of Guaranty  EXHIBIT D  Form of Assignment and Assumption
 EXHIBIT E  Form of Pledge Agreement  EXHIBIT F  Form of Security Agreement
 EXHIBIT G  Form of Intercompany Note

 

 
6

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

 

CREDIT AGREEMENT
 
 
THIS CREDIT AGREEMENT, dated as of October 20, 2010 is among KENEXA TECHNOLOGY,
INC., a Pennsylvania corporation (the “Borrower”), the several banks and other
financial institutions from time to time parties hereto (individually, a
“Lender”; collectively, the “Lenders”) and PNC BANK, NATIONAL ASSOCIATION, as
Administrative Agent (in such capacity, the “Administrative Agent”).
 
W I T N E S S E T H:
 
In consideration of the premises and other valuable consideration, the receipt
and adequacy of which are hereby acknowledged, and with the intent to be legally
bound hereby, the parties hereto agree as follows:
 
SECTION 1.   DEFINITIONS
 
1.1 Defined Terms.
 
As used in this Agreement, the following terms shall have the following
meanings:
 
“Accumulated Funding Deficiency”:  any accumulated funding deficiency as defined
in Sections 302(a) of ERISA and 412(a) of the Code prior to the amendment by the
Pension Protection Act of 2006.
 
“Actual Salary.com EBITDA Adjustments”:  an amount equal to the documented
annual personnel related and specific third-party cost savings actually achieved
in connection with the integration of Salary.com and its Subsidiaries after the
Merger, which cost savings are implemented within sixty days after the Merger,
as determined by a third-party selected by the Administrative Agent and
reasonably acceptable to the Borrower in accordance with the provisions of
Section 5.1(i).
 
“Adjusted Revolving Credit Commitment Percentage”:  with respect to any
non-Defaulting Lender, the quotient (expressed as a percentage) of such Lender’s
aggregate Revolving Credit Commitment divided by the aggregate Revolving Credit
Commitments of all non-Defaulting Lenders.
 
“Adjusted Funding Target Attainment Percentage”:  an adjusted target attainment
percentage as defined in Sections 206(g)(9) of ERISA and 436(j) of the Code.
 
“Administrative Agent”:  as defined in the Preamble hereto, and its successors
in such capacity appointed pursuant to Section 8.10.
 
“Affiliate”:  as to any Person, any other Person which, directly or indirectly,
through one or more intermediaries, controls, or is controlled by, or is under
common control with, such Person and any member, partner, director, officer or
employee of any such Person.  For purposes of this definition, “control” shall
mean the power, directly or indirectly, either to (a) vote 10% or more of the
Capital Stock of such Person, (b) vote 10% or more of the securities having
ordinary voting power for the election of directors of such Person or (c) direct
or in effect cause the direction of the management and policies of such Person
whether by contract or otherwise.
 

 
7

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

 
 
 
“Agents”:  the collective reference to the Administrative Agent and the Lead
Arranger.
 
 “Agreement”:  this Credit Agreement, as amended, supplemented or otherwise
modified from time to time.
 
“Anti-Terrorism Laws”:  any laws relating to terrorism or money laundering,
including Executive Order No. 13224 and the USA Patriot Act.
 
“Applicable Commitment Fee Percentage”:  on any date, the percentage per annum
set forth below opposite the Fixed Charge Coverage Ratio set forth below as
shown on the last Compliance Certificate delivered by the Borrower to the
Administrative Agent pursuant to subsection 5.1(c) prior to such date:
 
Level
Fixed Charge Coverage Ratio
Applicable Commitment
Fee Percentage
I
Greater than 2.00 to 1.0
0.30%
II
Less than or equal to 2.00 to 1.0, but greater than 1.75 to 1.0
0.35%
III
Less than or equal to 1.75 to 1.0
0.40%

provided, however, that (a) adjustments, if any, to the Applicable Commitment
Fee Percentage resulting from a change in the Fixed Charge Coverage Ratio shall
be effective three (3) Business Days after the Administrative Agent has received
a Compliance Certificate, (b) in the event that no Compliance Certificate has
been delivered for a fiscal quarter on or prior to the last date on which it can
be delivered without violation of subsection 5.1(c), the Applicable Commitment
Fee Percentage from such date until such Compliance Certificate is actually
delivered shall be that applicable under Level III, (c) anything in this
definition to the contrary notwithstanding, until receipt by the Administrative
Agent of the annual audited financial statements required by subsection 5.1(a)
for the fiscal year ending December 31, 2010 together with the accompanying
Compliance Certificate, the Applicable Commitment Fee Percentage shall be that
applicable under Level III and (iv) if, during any four consecutive fiscal
quarter period for which the Fixed Charge Coverage Ratio is being calculated,
the aggregate goodwill impairment charges of the Parent and its Subsidiaries on
a consolidated basis determined in accordance with GAAP is equal to or greater
than $20,000,000, the Applicable Commitment Fee Percentage at each Level above
shall increase by ten (10) basis points (0.1%).  By way of example, if for a
period of four consecutive fiscal quarters the Fixed Charge Coverage Ratio is
2.0 to 1.0 (and so the Borrower is in Level II) and, during such four-quarter
period the Parent and its Subsidiaries had $20,000,000 in the aggregate of
goodwill impairment charges, the Applicable Commitment Fee Percentage would be
0.45%.
 

 
8

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

 

 
“Applicable Margin”:  on any date, for any Base Rate Loan or Eurodollar Loan,
the percentage per annum set forth below in the column entitled “Applicable
Margin - Base Rate Loans” or “Applicable Margin - Eurodollar Loans,” as
appropriate, opposite the Fixed Charge Coverage Ratio set forth below as shown
on the last Compliance Certificate delivered by the Borrower to the
Administrative Agent pursuant to subsection 5.1(c) prior to such date:
 
Level
Fixed Charge Coverage Ratio
Applicable Margin -
Base Rate Loans
Applicable Margin – Eurodollar Loans
I
Greater than 2.00 to 1.0
1.75%
2.75%
II
Less than or equal to 2.00 to 1.0, but greater than 1.75 to 1.0
2.00%
3.00%
III
Less than or equal to 1.75 to 1.0
2.25%
3.25%

 
provided, however, that (a) adjustments, if any, to the Applicable Margin
resulting from a change in the Fixed Charge Coverage Ratio shall be effective
three (3) Business Days after the Administrative Agent has received a Compliance
Certificate, (b) in the event that no Compliance Certificate has been delivered
for a fiscal quarter on or prior to the last date on which it can be delivered
without violation of subsection 5.1(c), the Applicable Margin from such date
until such Compliance Certificate is actually delivered shall be that applicable
under Level III, (d) anything in this definition to the contrary
notwithstanding, until receipt by the Administrative Agent of the annual audited
financial statements required by subsection 5.1(a) for the fiscal year ending
December 31, 2010 together with the accompanying Compliance Certificate, the
Applicable Margin shall be that applicable under Level III and (iv) if, during
any four consecutive fiscal quarter period for which the Fixed Charge Coverage
Ratio is being calculated, the aggregate goodwill impairment charges of the
Parent and its Subsidiaries on a consolidated basis determined in accordance
with GAAP is equal to or greater than $20,000,000, the Applicable Margin at each
Level above shall increase by fifty (50) basis points (0.50%).  By way of
example, if for a period of four consecutive fiscal quarters the Fixed Charge
Coverage Ratio is 2.0 to 1.0 (and so the Borrower is in Level II) and, during
such four-quarter period the Parent and its Subsidiaries had $20,000,000 in the
aggregate of goodwill impairment charges, the Applicable Margin for Base Rate
Loans would be 2.50% and the Applicable Margin for Eurodollar Loan would be
3.50%.
 
“Application”:  in respect of each Letter of Credit issued by the Issuing Bank,
an application, in such form as the Issuing Bank may specify from time to time,
requesting issuance of such Letter of Credit, as it may be amended, supplemented
or modified from time to time.
 
“Asset Sale”:  as defined in subsection 2.11(c).
 
“Assignment and Assumption”:  an assignment and assumption entered into by a
Lender and a Purchasing Lender in accordance with and subject to the terms and
conditions of Section 9.6, substantially in the form of Exhibit D attached
hereto, or such other form as shall be approved by the Administrative Agent, as
it may be amended, supplemented or modified from time to time.
 

 
9

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

 
 
“Base Rate”  : for any day, a fluctuating per annum rate of interest equal to
the highest of (a) the Prime Rate in effect on such day, (b) the Federal Funds
Open Rate in effect on such day plus ½ of 1% and (c) the Daily LIBOR Rate in
effect on such day plus one hundred basis points (1.00%).  If for any reason the
Administrative Agent shall have determined (which determination shall be
conclusive absent manifest error) that it is unable to ascertain the Federal
Funds Open Rate or the Daily LIBOR Rate for any reason, the Base Rate shall be
determined without regard to clause (b) or (c) as the case may be, of the first
sentence of this definition until the circumstances giving rise to such
inability no longer exist.  Any change in the Base Rate due to a change in the
Prime Rate, the Federal Funds Open Rate or the Daily LIBOR Rate shall be
effective on the effective date of such change in the Prime Rate, the Federal
Funds Open Rate or the Daily LIBOR Rate,  respectively.
 
“Base Rate Borrowing”:  a Borrowing comprised of Base Rate Loans.
 
“Base Rate Loans”:  any Loan (other than a Swing Line Loan) bearing interest at
a rate determined by reference to the Base Rate.
 
“Borrower”:  as defined in the Preamble hereto.
 
“Borrowing”:  each group of Loans of a single Type made by the Lenders under one
Facility on a single date and, in the case of Eurodollar Loans, as to which a
single Interest Period is in effect.
 
“Borrowing Availability”:  at any particular time, the lesser of (a) an amount
equal to the excess, if any, of (i) the aggregate Revolving Credit Commitments
of the Revolving Credit Lenders at such time over (ii) the aggregate Revolving
Credit Exposure of the Revolving Credit Lenders at such time, and (b) the
maximum amount of Revolving Credit Loans which, if borrowed on the last day of
the immediately preceding fiscal quarter of the Parent for which financial
statements have been delivered to the Administrative Agent, would not have
caused a violation of the Total Net Leverage Ratio under Section 6.1(a) as of
the end of such fiscal quarter.
 
“Borrowing Date”:  any Business Day on which a Loan is to be made at the request
of the Borrower under this Agreement.
 
“Budget”: as defined in subsection 5.1(h).
 
“Business Day”:  a day other than a Saturday, Sunday or other day on which
commercial banks in Pittsburgh or Philadelphia, Pennsylvania, are authorized or
required by law or other governmental action to close and if the applicable
Business Day relates to any Eurodollar Loan, such day must also be a day on
which dealings are carried on in the London interbank market.
 
“Capital Expenditures”:  any expenditure of the Parent or any Subsidiary of the
Parent which would be classified as a capital expenditure in accordance with
GAAP.
 

 
10

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

 

 
“Capital Lease”:  at any time, a lease with respect to which the lessee is
required to recognize the acquisition of an asset and the incurrence of a
liability in accordance with GAAP.
 
“Capital Lease Obligations”:  at any time, the amount of the obligations under
Capital Leases which would be shown at such time as a liability on a
consolidated balance sheet of the Parent and its consolidated Subsidiaries
prepared in accordance with GAAP.
 
“Capital Stock”:  any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all
partnership interests in a partnership (general or limited), any and all
equivalent ownership interests in a Person (other than a corporation or
partnership), including interests in a limited liability company, and any and
all warrants or options to purchase any of the foregoing.
 
“Cash Equivalents”:  (a) securities with maturities of 90 days or less from the
date of acquisition issued or fully guaranteed or insured by the United States
or any agency thereof, (b) certificates of deposit with maturities of 90 days or
less from the date of acquisition and overnight bank deposits of any commercial
bank having capital, surplus and undivided profits aggregating at least
$500,000,000, (c) repurchase obligations of any commercial bank satisfying the
requirements of clause (b) of this definition, (d) commercial paper of a
domestic issuer rated at least A-2 or better by S&P or P-2 or better by Moody’s
and in either case maturing within 90 days after the date of acquisition,
(e) securities with maturities of 90 days or less from the date of acquisition
issued or fully guaranteed by any state, commonwealth or territory of the United
States or by any political subdivision or taxing authority of any such state,
commonwealth or territory, and such securities of such state commonwealth,
territory, political subdivision or taxing authority, as the case may be, are
rated at least A by S&P or A by Moody’s, (f) securities with maturities of 90
days or less from the date of acquisition backed by standby letters of credit
issued by any commercial bank satisfying the requirements of clause (b) of this
definition, or (g) shares of “money market funds” within the meaning of Rule
2a-7 of the Investment Company Act of 1940, as amended.
 
“Cash Management Agreements”:  as defined in Section 2.5(g).
 
“Certificate of Ownership and Merger”:  the Certificate of Ownership and Merger
filed with the State of Delaware on October 1, 2010 evidencing the merger of
Spirit Merger Sub with and into Salary.com, with Salary.com as the surviving
entity.
 
“Change of Control”:  any transaction or occurrence or series of transactions or
occurrences which results at any time in:
 
(a) any Person or group of Persons (within the meaning of Sections 13(d) or
14(a) of the Securities Exchange Act of 1934, as amended) shall have acquired,
after the Closing Date, beneficial ownership of (within the meaning of Rule
13d-3 promulgated by the SEC under said Act) 30.00% or more of the voting
Capital Stock of the Parent;
 

 
11

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

 

 
(b) within a period of twelve (12) consecutive calendar months, individuals who
were directors of the Parent on the first day of such period (together with any
new directors whose election by the board of directors of the Parent or whose
nomination for election by the shareholders of the Parent was approved by a vote
of a majority of the directors then still in office who were either directors as
of the first day of such period or whose election or nomination for election was
previously so approved) shall cease to constitute a majority of the board of
directors of the Parent; or
 
(c) the Parent ceasing to own, whether directly or indirectly, beneficially and
of record less than one hundred percent (100%) of each class of Capital Stock of
the Borrower.
 
“Closing” and “Closing Date”:  as defined in Section 4.3.
 
“Code”:  the Internal Revenue Code of 1986, as amended from time to time.
 
“Collateral”:  all property of the Parent, Borrower and the other Loan Parties
which is at the time subject to the Lien of any of the Security Documents in
favor of the Administrative Agent for the benefit of the holders of the
Obligations.
 
“Commitment Fees”:  as defined in Section 2.9.
 
“Commonly Controlled Entity”:  an entity, whether or not incorporated, which is
under common control with the Parent within the meaning of Section 4001 of ERISA
or is part of a group which includes the Parent and which is treated as a single
employer under Section 414(b), (c), (m) or (o) of the Code.
 
“Compliance Certificate”:  as defined in subsection 5.1(c).
 
“Consideration”:  with respect to any acquisition, the consideration paid or
proposed to be paid by the Borrower and its Subsidiaries with respect to such
acquisition (including earnouts, payments under non-compete arrangements and any
assumption of Indebtedness).
 
“Contractual Obligation”:  as to any Person, any provision of any security
issued by such Person or any provision of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.
 
“Daily LIBOR Rate”: for any day, the rate per annum determined by the
Administrative Agent by dividing (the resulting quotient rounded upwards, if
necessary, to the nearest 1/100th of 1%) (a) the Published Rate by (b) a number
equal to 1.00 minus the Eurocurrency Reserve Percentage.  The Published Rate
shall be adjusted as of each Business Day based on changes in the Published Rate
or the Eurocurrency Reserve Percentage without notice to the Borrower, and shall
be applicable from the effective date of any such change.
 

 
12

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

 

“Default”:  any of the events specified in Section 7.1, whether or not any
requirement for the giving of notice, the lapse of time, or both, or any other
condition precedent therein set forth, has been satisfied.
 
“Default Rate”:  as defined in Section 2.7.
 
“Defaulting Lender”:  any Lender, as determined by the Administrative Agent,
that has (a) failed to fund any portion of its Revolving Credit Loans or
participations in Swing Line Loans within three Business Days of the date
required to be funded by it hereunder, (b) notified the Borrower, the
Administrative Agent, the Issuing Bank, the Swing Line Lender or any Lender in
writing that it does not intend to comply with any of its funding obligations
under this Agreement or has made a public statement to the effect that it does
not intend to comply with its funding obligations under this Agreement or under
other agreements in which it commits to extend credit, (c) failed, within three
Business Days after request by the Administrative Agent, to confirm that it will
comply with the terms of this Agreement relating to its obligations to fund
prospective Revolving Credit Loans or participations in outstanding Letters of
Credit and Swing Line Loans, (d) otherwise failed to pay over to the
Administrative Agent or any other Lender any other amount required to be paid by
it hereunder within three Business Days of the date when due, unless the subject
of a good faith dispute, or (e) (i) become or is insolvent or has a parent
company that has become or is insolvent or (ii) become the subject of a
bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee
or custodian appointed for it, or has taken any action in furtherance of, or
indicating its consent to, approval of or acquiescence in any such proceeding or
appointment or has a parent company that has become the subject of a bankruptcy
or insolvency proceeding, or has had a receiver, conservator, trustee or
custodian appointed for it, or has taken any action in furtherance of, or
indicating its consent to, approval of or acquiescence in any such proceeding or
appointment (it being understood that a Defaulting Lender shall cease to be a
Defaulting Lender if the Borrower, the Administrative Agent, the Issuing Bank
and the Swing Line Lender shall each agree that such Defaulting Lender has
adequately remedied all matters that caused such Lender to be a Defaulting
Lender).
 
“Distribution”:  in respect of any Capital Stock of any Person (a) dividends or
other distributions on such Capital Stock (except distributions in other Capital
Stock of such Person) and (b) the redemption or acquisition of such Capital
Stock or of warrants, rights or other options to purchase such Capital Stock
(except when solely in exchange for Capital Stock of such Person), including,
without limitation, any payments on or in respect of any redeemable preferred
stock of such Person.
 
“Dollars” and “$”:  dollars in lawful currency of the United States of America.
 
“Domestic Subsidiary”:  any Subsidiary other than a Foreign Subsidiary.
 
“EBITDA”:  for any period, net income (excluding (i) non-cash equity
compensation expenses, (ii) interest income, (iii) non-cash charges or income
relating to the effects of using purchase accounting in connection with an
acquisition (whether before or after the Closing Date) and (iv) mark-to-market
adjustments in connection with Hedge Agreements and other non-cash income or
charges, in each case for such period), plus, to the extent deducted from such
net income, the sum of (without duplication) (a) gross interest expense,
(b) income
 

 
13

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

 

taxes, (c) depreciation and amortization, (d) non-cash goodwill intangible
impairment charges, (e) one-time third party transaction expenses and severance
costs directly related to any completed acquisition that is a Permitted
Acquisition or is consented to by the Required Lenders which are incurred within
one hundred twenty (120) days after the date that such acquisition is
consummated, all as determined for the Parent and its Subsidiaries on a
consolidated basis in accordance with GAAP and as documented to the
Administrative Agent in reasonable detail; provided that, if at any time during
such period the Parent or any of its Subsidiaries shall have sold or otherwise
divested any material assets or stock in any Subsidiary, any book gain or loss
resulting from such sale or other divestiture, together with the net income or
loss of such Subsidiary or attributable to such assets shall also be excluded
from net income.  As used in the definitions of Modified EBITDA and Permitted
Acquisition, EBITDA shall also be determined for any Person who has (or whose
assets have) been acquired by a Loan Party to the extent provided in such
definition.
 
“Employee Pension Plan”:  any pension plan which (a) is maintained, contributed
to, or under which there is an obligation to contribute by the Parent, any
Subsidiary thereof or any Commonly Controlled Entity and (b) is subject to
Part 3 of Title I of ERISA.
 
“Environmental Laws”:  any and all Federal, state, local, municipal or foreign
laws, rules, orders, regulations, statutes, ordinances, codes, decrees or
binding requirements of any Governmental Authority, or binding Requirement of
Law regulating, relating to or imposing liability or standards of conduct
concerning protection of the environment, as now or may at any time hereafter be
in effect.
 
“ERISA”:  the Employee Retirement Income Security Act of 1974, as amended, and
any regulations issued thereunder by the Department of Labor or PBGC.
 
 “Eurocurrency Reserve Percentage”:  as of any day the maximum percentage in
effect on such day, as prescribed by the Board of Governors of the Federal
Reserve System (or any successor) for determining the reserve requirements
(including supplemental, marginal and emergency reserve requirements) with
respect to Eurocurrency funding (currently referred to as “Eurocurrency
Liabilities”).
 
“Eurodollar Borrowing”:  a Borrowing comprised of Eurodollar Loans.
 
“Eurodollar Loan”:  any Loan bearing interest at a rate determined by reference
to the Eurodollar Rate in accordance with the provisions of Section 2.
 
“Eurodollar Rate”:  with respect to the Loans comprising any Eurodollar
Borrowing for any Interest Period, the interest rate per annum determined by the
Administrative Agent by dividing (the resulting quotient rounded upwards, if
necessary, to the nearest 1/100th of 1% per annum) (a) the rate which appears on
the Bloomberg Page BBAM1 (or on such other substitute Bloomberg page that
displays rates at which US dollar deposits are offered by leading banks in the
London interbank deposit market), or the rate which is quoted by another source
selected by the Administrative Agent which has been approved by the British
Bankers’ Association as an authorized information vendor for the purpose of
displaying rates at which US dollar deposits are offered by leading banks in the
London interbank deposit market
 

 
14

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

 

(for purposes of this definition, an “Alternate Source”), at approximately
11:00 a.m., London time, two (2) Business Days prior to the commencement of such
Interest Period as the London interbank offered rate for U.S. Dollars for an
amount comparable to such Eurodollar Borrowing and having a borrowing date and a
maturity comparable to such Interest Period (of if there shall at any time, for
any reason, no longer exist a Bloomberg Page BBAM1 (or any substitute page) or
any Alternate Source, a comparable replacement rate determined by the
Administrative Agent at such time (which determination shall be conclusive
absent manifest error)), by (b) a number equal to 1.00 minus the Eurocurrency
Reserve Percentage.  The Eurodollar Rate may also be expressed by the following
formula:
 
Eurodollar Rate =
London interbank offered rates quoted by Bloomberg

 
 
or appropriate successor as shown on Bloomberg Page BBAM1

 

 
1.00 - Eurocurrency Reserve Percentage

 
The Eurodollar Rate shall be adjusted with respect to any Eurodollar Borrowing
that is outstanding on the effective date of any change in the Eurocurrency
Reserve Percentage as of such effective date.  The Administrative Agent shall
give prompt notice to the Borrower of the Eurodollar Rate as determined or
adjusted in accordance herewith, which determination shall be conclusive absent
manifest error.
 
“Event of Default”:  any of the events specified in Section 7, provided that any
requirement for the giving of notice, the lapse of time, or both, or any other
condition, has been satisfied.
 
“Excess Cash Flow”: for any fiscal year, the amount by which EBITDA, less any
cash severance charges and one time cash transaction expenses added to EBITDA
pursuant to clause (e) of the definition thereof, exceeds the sum of Fixed
Charges and Capital Expenditures, in each case determined for the Parent and its
Subsidiaries on a consolidated basis in accordance with GAAP for such fiscal
year.
 
“Excluded Taxes”:  with respect to the Administrative Agent, any Lender, any
Issuing Bank or any other recipient of any payment to be made by or on account
of any obligation of Borrower hereunder (a) income or franchise taxes imposed on
(or measured by) its net income by the United States of America, or by the
jurisdiction under the laws of which such recipient is organized or in which its
principal office is located or, in the case of any Lender, in which its
applicable lending office is located, (b) any branch profits taxes imposed by
the United States of America or any similar tax imposed by any other
jurisdiction in which Borrower is located and (c) in the case of a Foreign
Lender (other than an assignee pursuant to a request by Borrower under Section
2.19), any withholding tax that is imposed on amounts payable to such Foreign
Lender at the time such Foreign Lender becomes a party to this Agreement (or
designates a new lending office) or is attributable to such Foreign Lender’s
failure to comply with subsection 2.14(b), except to the extent that such
Foreign Lender (or its assignor, if any) was entitled, at the time of
designation of a new lending office (or assignment), to receive additional
amounts from Borrower with respect to such withholding tax pursuant to
Section 2.14.
 

 
15

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

 

“Executive Order No. 13224”:  Executive Order No. 13224 on Terrorist Financing,
effective September 24, 2001, as the same has been, or shall hereafter be,
renewed, extended, amended or replaced.
 
“Existing Credit Agreement”:  that certain Credit Agreement dated as of
August 31, 2010 among the Borrower, PNC Bank, National Association, as agent,
and the banks and financial institutions party thereto, as heretofore amended,
modified or supplemented.
 
“Existing Letters of Credit”:  those letters of credit issued by PNC under the
Existing Credit Agreement which are outstanding on the Closing Date.  A list of
the Existing Letters of Credit is set forth on Schedule II.
 
“Facilities”:  the facilities represented by the Term Loans and the Revolving
Credit Loans.  The two Facilities are the “Revolving Credit Facility” and the
“Term Loan Facility”.
 
“Fee Letter”:  the letter dated as of September 8, 2010, signed by the Borrower,
PNC and the Lead Arranger relating to fees, as amended, supplemented or
otherwise modified from time to time.
 
“Federal Funds Effective Rate”:  for any day, the rate per annum (based on a
year of three hundred sixty (360) days and actual days elapsed and rounded
upward to the nearest 1/100 of one percent (1%)) announced by the Federal
Reserve Bank of New York (or any successor) on such day as being the weighted
average of the rates on overnight federal funds transactions arranged by federal
funds brokers on the previous trading day, as computed and announced by such
Federal Reserve Bank (or any successor) in substantially the same manner as such
Federal Reserve Bank computes and announces the weighted average it refers to as
the “Federal Funds Effective Rate” as of the date of this Agreement; provided,
if such Federal Reserve Bank (or its successor) does not announce such rate on
any day, the “Federal Funds Effective Rate” for such day shall be the Federal
Funds Effective Rate for the last day on which such rate was announced.
 
“Federal Funds Open Rate”:  for any day, the rate per annum (based on a year of
360 days and actual days elapsed) which is the daily federal funds open rate as
quoted by ICAP North America, Inc. (or any successor) as set forth on the
Bloomberg Screen BTMM for that day opposite the caption “OPEN” (or on such other
substitute Bloomberg Screen that displays such rate), or as set forth on such
other recognized electronic source used for the purpose of displaying such rate
as selected by the Administrative Agent (an “Alternate Source”) (or if such rate
for such day does not appear on the Bloomberg Screen BTMM (or any substitute
screen) or on any Alternate Source, or if there shall at any time, for any
reason, no longer exist a Bloomberg Screen BTMM (or any substitute screen) or
any Alternate Source, a comparable replacement rate determined by the
Administrative Agent at such time (which determination shall be conclusive
absent manifest error); provided however, that if such day is not a Business
Day, the Federal Funds Open Rate for such day shall be the “open” rate on the
immediately preceding Business Day.
 

 
16

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

 

“Fixed Charge Coverage Ratio”:  as of the last day of any fiscal quarter, the
ratio of (a) EBITDA less Capital Expenditures to (b) Fixed Charges, in each case
determined for the Parent and its Subsidiaries on a consolidated basis for the
period of four (4) consecutive fiscal quarters ending on such date.
 
“Fixed Charges”:  for any period, the sum of (a) cash income taxes, (b) gross
cash interest expense, (c) cash Distributions, and (d) scheduled principal
payments of all Indebtedness (excluding paydowns of Revolving Credit Loans or
Swing Line Loans, but including seller notes), all as determined for the Parent
and its Subsidiaries, on a consolidated basis in accordance with GAAP and
without duplication.
 
“Foreign Benefit Event”:  with respect to any Foreign Pension Plan, (a) the
existence of unfunded liabilities in excess of the amount permitted under any
applicable law, or in excess of the amount that would be permitted absent a
waiver from a Governmental Authority, (b) the failure to make the required
contributions or payments, under any applicable law, on or before the due date
for such contributions or payments, (c) the receipt of a notice of a
Governmental Authority relating to the intention to terminate any such Foreign
Pension Plan or to appoint a trustee or similar official to administer any such
Foreign Pension Plan or alleging the insolvency of any such Foreign Plan, (d)
the incurrence of any liability in excess of $250,000 in the aggregate by the
Parent and its Subsidiaries under applicable law and on account of the complete
or partial termination of such Foreign Pension Plan or the complete or partial
withdrawal of any participating employer therein, or (e) the occurrence of any
transaction that is prohibited under any applicable law and that would
reasonably be expected to result in the incurrence of any liability by the
Parent and its Subsidiaries or the imposition on the Parent, the Borrower and
their Subsidiaries of any fine, excise tax or penalty resulting from any
noncompliance with any applicable law, in each in excess of in the aggregate of
$250,000.
 
“Foreign Lender”:  any Lender that is not organized under the laws of the United
States of America, any State thereof or the District of Columbia.
 
“Foreign Pension Plan”:  any benefit plan maintained by a Foreign Subsidiary
that under applicable law is required to be funded through a trust or other
funding vehicle other than a trust or funding vehicle maintained exclusively by
a Governmental Authority.
 
“Foreign Subsidiary”:  any Subsidiary not organized under the laws of the United
States of America, any State thereof or the District of Columbia.
 
“Fronting Fee”:  as defined in Section 2.4(b).
 
“GAAP”:  at any time with respect to the determination of the character or
amount of any asset or liability or item of income or expense, or any
consolidation or other accounting computation, generally accepted accounting
principles as in effect in the United States on the date of, or at the end of
the period covered by, the financial statements from which such asset,
liability, item of income, or item of expense, is derived, or, in the case of
any such computation, as in effect on the date when such computation is required
to be determined, consistently applied.
 

 
17

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

 

“Governmental Acts”:  as defined in subsection 2.4(j).
 
“Governmental Authority”:  any nation or government, any state or other
political subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government.
 
“Guarantor”:  the Parent and each Subsidiary of the Parent now or hereafter
executing and delivering a Guaranty.  The initial Guarantors shall be the
Parent, Kenexa Government Solutions, Inc., Kenexa Strategic Outsourcing
Corporation, Devon Royce, Inc., Nextworx, Inc., Kenexa Recruiter, Inc., Kenexa
BrassRing, Inc. and Salary.com, Inc.
 
“Guaranty”:  a Guaranty and Suretyship Agreement delivered to the Administrative
Agent by a Guarantor substantially in the form of Exhibit C hereto, as the same
may be amended, supplemented or otherwise modified from time to time.
 
“Guaranty Obligation”:  as to any Person, any guarantee of payment or
performance by such Person of any Indebtedness or other obligation of any other
Person, or any agreement to provide financial assurance with respect to the
financial condition, or the payment of the obligations of, such other Person
(including, without limitation, purchase or repurchase agreements, reimbursement
agreements with respect to letters of credit or acceptances, indemnity
arrangements, grants of security interests to support the obligations of another
Person, keepwell agreements and take-or-pay or through-put arrangements) which
has the effect of assuring or holding harmless any third Person against loss
with respect to one or more obligations of such third Person; provided, however,
the term Guaranty Obligation shall not include endorsements of instruments for
deposit or collection in the ordinary course of business.  The amount of any
Guaranty Obligation of any Person shall be deemed to be the lower of (a) an
amount equal to the stated or determinable amount of the primary obligation in
respect of which such Guaranty Obligation is made and (b) the maximum amount for
which such contingently liable Person may be liable pursuant to the terms of the
instrument embodying such Guaranty Obligation, unless the maximum amount is not
stated or determinable, in which case the amount of such Guaranty Obligation
shall be such contingently liable Person’s maximum reasonably anticipated
liability in respect thereof as determined by such Person in good faith and
approved by the Administrative Agent.
 
“Hedge Agreement”:  any (a) interest rate swap agreement, interest rate cap
agreement, interest rate floor agreement, interest rate collar agreement,
interest rate option or any other agreement regarding the hedging of interest
rate risk exposure executed in connection with hedging the interest rate
exposure of any Person and any confirming letter executed pursuant to such
agreement and (b) a foreign exchange contract, currency swap agreement, futures
contract, option contract, synthetic cap or any other agreement regarding the
hedging of fluctuations of currency values and any confirming letter executed
pursuant to such agreement, all as amended, restated, supplemented or otherwise
modified from time to time.
 
“Increased Commitment and Acceptance”:  as defined in subsection 2.10(c).
 
“Increase Date”:  as defined in subsection 2.10(c).
 
“Indebtedness”:  of any Person at any date, without duplication:
 

 
18

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

 

(a) all indebtedness of such Person for borrowed money or for the deferred
purchase price of property or services (other than trade liabilities incurred in
the ordinary course of business not more than 60 days overdue (or being
contested in good faith) and payable in accordance with customary practices),
including seller’s notes,
 
(b) any other indebtedness which is evidenced by a note, bond, debenture or
similar instrument,
 
(c) all Capital Lease Obligations of such Person,
 
(d) all reimbursement and other obligations of such Person in respect of letters
of credit, bankers’ acceptances and similar obligations created for the account
of such Person, in each case whether or not matured,
 
(e) all liabilities secured by any Lien on any property owned by such Person
even though such Person has not assumed or otherwise become liable for the
payment thereof,
 
(f) all liabilities with respect to the mandatory redemption price (excluding
accrued dividends) with respect to redeemable preferred stock subject to
mandatory redemption prior to the later of the Revolving Credit Termination Date
and the Term Loan Maturity Date,
 
(g) net liabilities of such Person under any Hedge Agreements, foreign currency
exchange agreements, netting agreements and other hedging agreements or
arrangements (calculated on a basis satisfactory to the Administrative Agent and
in accordance with accepted practice), and
 
(h) all Guaranty Obligations of such Person with respect to liabilities of a
type described in any of clauses (a) through (g) of this definition.
 
The Indebtedness of any Person shall include any Indebtedness of any partnership
in which such Person is the general partner.
 
“Indemnified Parties”: as defined in Section 9.5.
 
“Insolvency”:  with respect to any Multiemployer Plan, the condition that such
Plan is insolvent within the meaning of Section 4245 of ERISA.
 
“Insolvent”:  pertaining to a condition of Insolvency.
 
“Intellectual Property”:  has the meaning ascribed thereto in Section 3.9.
 
“Interest Payment Date”:  (a) as to any Base Rate Loan or Swing Line Loan, each
January 1, April 1, July 1 and October 1, (b) as to any Eurodollar Loan having
an Interest Period of three months or less, the last day of such Interest
Period, (c) as to any Eurodollar Loan having an Interest Period longer than
three months, each day which is three months, or a whole multiple thereof, after
the first day of such Interest Period and the last day of such Interest Period,
(d) as to any Swing Line Loan, in addition to the foregoing, the Swing Line
Prepayment Date, (e) as to any Revolving Credit Loan or Swing Line Loan, in
addition to the foregoing, the Revolving
 

 
19

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

 

Credit Termination Date and (f) as to any Term Loan, in addition to the
foregoing, the Term Loan Maturity Date.
 
“Interest Period”:  with respect to any Eurodollar Loan:
 
(a) initially the period commencing on the borrowing or conversion date, as the
case may be, with respect to such Eurodollar Loan and ending one, two, three or
six months thereafter, as selected by the Borrower in its notice of borrowing or
notice of conversion, given with respect thereto; and
 
(b) thereafter, each period commencing on the last day of the next preceding
Interest Period applicable to such Eurodollar Loan and ending one, two, three or
six months thereafter, as selected by the Borrower by irrevocable notice to the
Administrative Agent not less than three Business Days prior to the last day of
the then current Interest Period with respect thereto;
 
provided that, the foregoing provisions relating to Interest Periods are subject
to the following:
 
(i) if any Interest Period would end on a day other than a Business Day, such
Interest Period shall be extended to the next succeeding Business Day unless
such next succeeding Business Day would fall in the next calendar month, in
which case such Interest Period shall end on the next preceding Business Day;
 
(ii) any Interest Period that begins on the last Business Day of a calendar
month (or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the last
Business Day of a calendar month;
 
(iii) with respect to Eurodollar Loans that are Revolving Credit Loans, an
Interest Period that otherwise would extend beyond the Revolving Credit
Termination Date shall end on the Revolving Credit Termination Date;
 
(iv) with respect to any Eurodollar Loans that are Term Loans, an Interest
Period that otherwise would extend beyond the Term Loan Maturity Date shall end
on the Term Loan Maturity Date; and
 
(v) the Borrower shall select Interest Periods so as not to require a payment or
prepayment of any Eurodollar Loan during an Interest Period for such Loan.
 
“Investments”:  investments (by loan or extension of credit, purchase, advance,
guaranty, capital contribution or otherwise) made in cash or by delivery of
Property, by any of the Parent or any Subsidiary (a) in any Person, whether by
acquisition of stock or other ownership interest, indebtedness or other
obligation or Security, or by loan, advance or capital contribution or (b) in
any Property.
 
“ISP98”:  as defined in Section 2.4(a).
 
“Issuing Bank”:  PNC, in its capacity as issuer of Letters of Credit, and any
successor thereto.
 

 
20

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

 

“Joinder”:  a Joinder Agreement in a form acceptable to the Administrative Agent
pursuant to which a Subsidiary of the Parent shall join the applicable Loan
Documents pursuant to Section 5.15, as amended, supplemented or otherwise
modified from time to time.
 
“Law”:  any law (including common law), constitution, statute, treaty,
regulation, rule, ordinance, opinion, release, ruling, order, injunction, writ,
decree or award of any Governmental Authority.
 
“L/C Disbursement”: a payment or disbursement made by the Issuing Bank pursuant
to a Letter of Credit.
 
“L/C Sublimit”:  $5,000,000.
 
“Lead Arranger”:  PNC Capital Markets LLC, in its capacity as Lead Arranger.
 
“Lender”:  as defined in the Preamble hereto and any other Person that becomes a
Lender hereunder by reason of an Assignment and Assumption or a New Lender
Joinder.
 
“Letter of Credit Coverage Requirement”:  with respect to each Letter of Credit
at any time, 102% of the maximum amount available to be drawn thereunder at such
time (determined without regard to whether any conditions to drawing could be
met at such time).
 
“Letter of Credit Fee”:  has the meaning assigned to that term in subsection
2.4(b).
 
“Letter of Credit Obligations”:  at any time, an amount equal to the sum of (a)
100% of the maximum amount available to be drawn under all Letters of Credit
outstanding at such time (determined without regard to whether any conditions to
drawing could be met at such time) and (b) the aggregate amount of drawings
under Letters of Credit which have not then been reimbursed pursuant to
subsection 2.4(d)(i).
 
“Letter of Credit Participant”:  in respect of each Letter of Credit, each
Lender (other than the Issuing Bank) in its capacity as the holder of a
participating interest in such Letter of Credit.
 
“Letters of Credit”:  collectively, the Existing Letters of Credit and any
letters of credit issued by the Issuing Bank under Section 2.4, as amended,
supplemented, extended or otherwise modified from time to time.
 
“Lien”:  any mortgage, deed of trust, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge or other security
interest or any preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including, without limitation, any
conditional sale or other title retention agreement and any capital lease having
substantially the same economic effect as any of the foregoing).
 
“Liquidity Level”:  at any particular time, an amount equal to the sum of the
Borrowing Availability and cash and Cash Equivalents maintained in Unrestricted
Investment
 

 
21

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

 

Accounts as determined for the Parent and its Subsidiaries on a consolidated
basis in accordance with GAAP.
 
“Loan Documents”:  the collective reference to this Agreement, the Notes, the
Security Documents, the Applications, the Letters of Credit, the Joinders, the
Fee Letter, the Cash Management Agreements, and any Subordination Agreement(s)
hereinafter entered into, and all other documents, instruments, agreements or
certificates delivered in connection herewith, in each case as amended,
supplemented or otherwise modified.
 
“Loan Parties”:  the Borrower, the Parent and each of their Subsidiaries that is
party to a Loan Document.
 
“Loans”:  the collective reference to the Revolving Credit Loans, the Swing Line
Loans and the Term Loans.  Each Revolving Credit Loan and Term Loan shall be
either a Eurodollar Loan or a Base Rate Loan.
 
 “Material Adverse Effect”:  a material adverse effect on (a) the validity or
enforceability of this Agreement or any other Loan Document, (b) the business,
Property, assets, financial condition or results of operations of the Parent and
its Subsidiaries taken as a whole, (c) the ability of the Parent and its
Subsidiaries to duly and punctually to pay their debts as they come due and to
perform their obligations under the Loan Documents, or (d) the ability of the
Administrative Agent and the Lenders to enforce their legal remedies pursuant to
this Agreement or any other Loan Document.
 
“Material Recovery Event”:  the receipt by the Parent or any of its Subsidiaries
of property, casualty or condemnation award proceeds in excess of $1,000,000.
 
“Materials of Environmental Concern”:  any gasoline or petroleum (including
crude oil or any fraction thereof) or petroleum products or any hazardous or
toxic substances, pollutants, contamination, materials or wastes, defined or
regulated as such in or under any Environmental Law, including, without
limitation, asbestos, polychlorinated biphynels, and ureaformaldehyde
insulation.
 
“Merger”:  the merger of Spirit Merger Sub with and into Salary.com under the
terms of the Merger Agreement, which Merger was consummated on October 1, 2010.
 
“Merger Agreement”: the Agreement and Plan of Merger by and among the Parent,
Spirit Merger Sub and Salary.com dated as of August 31, 2010, as it may be
amended, restated or modified from time to time.
 
 
 

 
22

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

 
 
                                 “Modified EBITDA”:  for any period of four
consecutive fiscal quarters (each a “Reference Period”), EBITDA for such
Reference Period; provided that, if at any time during such Reference Period,
the Borrower or any of its Subsidiaries shall have acquired the stock or assets
of any Person in a Permitted Acquisition, then so long as (a) the Lenders shall
have received audited financial statements for the prior two (2) years prepared
on a GAAP basis or an independent third-party due diligence report for such
Person from a nationally recognized accounting firm or other nationally
recognized firm reasonably acceptable to the Administrative Agent, (b) the
Person who is being acquired or who will own the assets being acquired is (or l,
upon closing of such acquisition, become) a Guarantor, unless such Person is a
Foreign Subsidiary, and (c) the Borrower complies with Section 5.15 hereof,
Modified EBITDA shall include (i) the historical EBITDA of such Person or
attributable to such assets for the period from the beginning of such Reference
Period to the day immediately preceding the closing date of such Permitted
Acquisition and (ii) such adjustments to such actual EBITDA as shall be
determined by the Required Lenders in their sole discretion; provided, that, if
audited financial statements or third-party due diligence report have not been
provided to the Lenders, (I) the historical EBITDA, if positive, of such Person
or attributable to such assets shall not be included in the calculation of
Modified EBITDA, unless consented to in writing by the Required Lenders in their
sole discretion and (II) the historical EBITDA, if negative, of such Person or
attributable to such assets shall be included in the calculation of Modified
EBITDA, unless the Required Lenders in their sole discretion elect otherwise;
provided, further, that, notwithstanding the foregoing, Modified EBITDA shall
include (w) for the period ending September 30, 2010, an amount equal to the
Salary.com Historical EBITDA plus $10,000,000, (x) for the period ending
December 31, 2010, an amount equal to seventy-five percent (75%) of the
Salary.com Historical EBITDA plus an amount equal to the lesser of (A)
$7,500,000 and (B) seventy-five percent (75%) of the Actual Salary.com EBITDA
Adjustments, (y) for the period ending March 31, 2011, an amount equal to fifty
percent (50%) of the Salary.com Historical EBITDA plus an amount equal to the
lesser of (A) $5,000,000 and (B) fifty percent (50%) of the Actual Salary.com
EBITDA Adjustments and (z) for the period ending June 30, 2011, an amount equal
to twenty-five percent (25%) of the Salary.com Historical EBITDA plus the lesser
of (A) $2,500,000 and (B) twenty-five percent (25%) of the Actual Salary.com
EBITDA Adjustments.
 
“Moody’s”:  Moody’s Investors Services, Inc.
 
“Multiemployer Plan”:  a Plan which is a multiemployer plan as defined in
Section 4001(a)(3) of ERISA and to which the Parent or its Subsidiaries, or a
Commonly Controlled Entity of any of the foregoing, is making or is obligated to
make contributions, or has made, or been obligated to make, contributions.
 
“Net Proceeds”:  (a) with respect to the sale or issuance after the Closing Date
of any Capital Stock of the Parent or the incurrence of additional Indebtedness
for borrowed money by the Parent or any Subsidiary thereof, the amount equal to
(i) the aggregate amount received in cash in connection with such sale or
issuance or incurrence minus (ii) the reasonable fees, commissions and other
out-of-pocket expenses incurred by the Parent or such Subsidiary in connection
with such sale or issuance or incurrence, (b) with respect to any Asset Sale,
the amount equal to (i) the aggregate amount received in cash (including any
cash received by way of deferred payment pursuant to a note receivable, other
non-cash consideration or otherwise, but only as and when such cash is so
received) in connection with such Asset Sale minus (ii) the sum of (I) the
principal amount of Indebtedness which is secured by the asset that is the
subject of such Asset Sale (other than Indebtedness assumed by the purchaser of
such asset) and which is required to be, and is, repaid in connection with such
Asset Sale (other than Indebtedness hereunder), (II) the reasonable fees,
commissions, income taxes and other out-of-pocket expenses incurred by the
Parent or such Subsidiary in connection with such Asset Sale and (III) amounts
established as a reserve, reasonably established by the Borrower or its
Subsidiaries (in accordance with GAAP), against liabilities under any
indemnification obligations associated with such Asset Sale or other liabilities
retained by the Borrower and its Subsidiaries associated with the properties
sold pursuant to such Asset Sale (provided that, to the extent and at the time
such amounts are released from such reserve, such amounts shall constitute Net
Proceeds), and (c) with respect to any Material Recovery Event, the amount equal
to (i) the aggregate amount of the property, casualty or condemnation award
proceeds received by the Parent or any Subsidiary in connection with such
Material Recovery Event minus (ii) the reasonable fees and other out-of-pocket
expenses incurred by the Parent and its Subsidiaries in connection with
recovering such proceeds.
 

 
23

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

 

                                 “New Lender”:  as defined in subsection 9.6(f).
 
“New Lender Joinder”:  as defined in subsection 2.10(c).
 
 “Non-Defaulting Lender”: at any time, all Lenders other than any Defaulting
Lenders at such time.
 
“Non-Defaulting Revolving Credit Lender”: at any time, a Non-Defaulting Lender
that is a Revolving Credit Lender.
 
“Non-Loan Party”:  any Subsidiary of the Borrower other than a Guarantor.  The
Non-Loan Parties as of the Closing Date are (a) Kenexa Technology Canada Inc.,
BrassRing Canada, Inc, Kenexa BrassRing Holdings BV, Kenexa BrassRing Ltd,
Kenexa BrassRing GmbH, Kenexa BrassRing Asia Pacific Ltd., Kenexa BrassRing BV,
Kenexa Limited, Kenexa Technologies Private Limited, Kenexa Technologies Sdn.
Bhd., Kenexa Puerto Rico Inc., Kenexa Argentina SRL, Kenexa International
Limited, Kenexa SA Pte. Ltd., Centre For High Performance Development Holdings
Ltd., Centre For High Performance Development USA Limited, Centre For High
Performance Development Limited, Centre For High Performance Development
(Singapore) Pte. Ltd., Kenexa Japan K.K., Kenexa Pty. Ltd., Kenexa Singapore
Pte. Ltd., Kenexa Servicos Em Recursos Humanos LTDA, Kenexa Testing Limited,
Kenexa France, SARL, Kenexa Middle East FZ LLC, Kenexa Quorum International
Holding Ltd., Quorum International Search Limited, Kenexa Quorum International
Search d.o.o., Kenexa Quorum sp. Z.o.o, Kenexa Quorum International Ltd. & Co.
KG, Kenexa Global Services Limited, Kenexa Munich AV GmbH, Kenexa Germany GmbH,
Salary.com Limited, SDC China Ltd. and Salary.com Jamaica Limited, all of whom
are Foreign Subsidiaries.
 
“Notes”:  the collective reference to the Revolving Credit Notes, the Swing Line
Note and the Term Notes.
 
“Notice of Borrowing”:  with respect to any Loan, a notice from the Borrower in
respect of such Loan, containing the information in respect of such Loan and
delivered to the Administrative Agent, in the manner and by the time specified
pursuant to the terms hereof.  A form of the Notice of Borrowing is attached
hereto as Exhibit B.
 
“Obligations”:  collectively, (a) all Reimbursement Obligations and all unpaid
principal of and accrued and unpaid interest on (including, without limitation,
any interest accruing subsequent to the commencement of a bankruptcy, insolvency
or similar proceeding with respect to the Borrower, whether or not such interest
constitutes an allowed claim in such proceeding) the Loans, (b) all accrued and
unpaid fees arising or incurred under this Agreement or any other Loan Document,
(c) any other amounts due hereunder or under any of the other Loan Documents,
including all reimbursements, indemnities, fees, costs, expenses, prepayment
premiums, break-funding costs and other obligations of the Borrower or any other
Loan Party to the Administrative Agent, any Lender or any indemnified party
hereunder or thereunder, (d) any obligations owed by the Borrower or any other
Loan Party to any Lender or to any Affiliate of any Lender pursuant to a Hedge
Agreement, (e) any obligations owed by the Borrower or any other Loan Party to
any Lender pursuant to any agreement governing the provision of cash management
services, including treasury, depository, overdraft, credit or debit cards
(including purchasing cards and commercial cards), electronic funds transfer and
other cash management arrangements, and (f) all out-of-pocket costs and expenses
incurred by the Administrative Agent and the Lenders in connection with this
Agreement and the other Loan Documents, including but not limited to the
reasonable fees and expenses of the Administrative Agent’s counsel and each
Lender’s counsel, which the Borrower is responsible to pay pursuant to the terms
of this Agreement and/or the other Loan Documents.
 

 
24

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

 
 
                                “Participant”:  as defined in subsection 9.6(g).
 
“Parent”:  Kenexa Corporation, a Pennsylvania corporation.
 
“PBGC”:  the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA, or any Governmental Authority succeeding to the
function thereof.
 
“Permitted Acquisition”:  subject to compliance with Section 6.6, an acquisition
by the Borrower or any Subsidiary thereof (whether by merger, consolidation,
reorganization or purchase of assets or stock or other ownership interests) of
any Person engaged in a business that the Borrower and its Subsidiaries is
permitted to engage in pursuant to Section 6.10 that is not hostile in nature;
provided, that, at the time that any definitive agreement is entered into in
respect of such acquisition (or immediately prior to the closing of such
agreement if such agreement contains a contingency for any approval required
under this Agreement with respect to such acquisition), no Default or Event of
Default shall exist or would exist if such acquisition were consummated on such
date (assuming for purposes of the covenants contained in Section 6.1, that
pro forma adjustments are made to the consolidated financial statements of the
Parent and its Subsidiaries in accordance with the terms hereof reflecting such
acquisition based on the historical audited financial statements (on a GAAP
basis) or independent third party due diligence report and other information of
such Person received by the Administrative Agent prior to the consummation of
such acquisition), provided further, that approval of the Required Lenders shall
be required for any such acquisition if (a) the aggregate Consideration with
respect to such acquisition exceeds $20,000,000 or the Borrower reasonably
believes that the amount payable under any earn-out or similar arrangement will
equal or exceed $10,000,000, (b) at the time of and after giving effect to such
acquisition, the Liquidity Level would be less than $15,000,000 or (c) the Total
Net Leverage Ratio calculated as of the end of the immediately preceding fiscal
quarter for which financial statements have been delivered to the Lenders on a
pro forma basis (i.e., after giving effect to such Permitted Acquisition and the
borrowing of any Indebtedness in connection therewith as if consummated on the
last day of such fiscal quarter) would exceed 1.75 to 1.0.
 

 
25

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

 

“Permitted Investments”:  Investments in:
 
(a) one or more Subsidiaries of the Borrower; provided that the aggregate amount
of net Investments made by the Borrower and the other Loan Parties in Non-Loan
Parties shall not exceed $10,000,000 in the aggregate for the period from and
after the Closing Date, including, in each case any Investments made after the
Closing Date in Non-Loan Parties pursuant to any other provisions of this
definition including clause (p) below (measured, with respect to any Permitted
Acquisition involving the assets or stock of a Non-Loan Party, as the purchase
price for such assets or stock as reasonably determined by the Borrower);
 
(b) Property to be used in the ordinary course of business of the Borrower and
its Subsidiaries;
 
(c) current assets arising from the sale or purchase of goods and services in
the ordinary course of business of the Borrower and its Subsidiaries;
 
(d) direct obligations of the United States of America or any agency or
instrumentality thereof, or obligations guaranteed by the United States of
America or any agency or instrumentality thereof, provided that such obligations
mature within one (1) year from the date of acquisition thereof;
 
(e) certificates of deposit, time deposits or banker’s acceptances, maturing
within one (1) year from the date of acquisition, with banks or trust companies
organized under the laws of the United States, the unsecured long-term debt
obligations of which are rated “A3” or higher by Moody’s or “A-” or higher by
S&P, and issued, or in the case of banker’s acceptance, accepted, by a bank or
trust company having capital, surplus and undivided profits aggregating at least
$500,000,000;
 
(f) commercial paper given the highest rating by either S&P or Moody’s maturing
not more than 270 days from the date of creation thereof;
 
(g) in “money market funds” within the meaning of Rule 2a-7 of the Investment
Company Act of 1940, as amended;
 
(h) in other short-term Investments utilized by Foreign Subsidiaries in
accordance with normal investment practices for cash management in Investments
of a type analogous to the foregoing clauses (d) through (g);
 
(i) received in connection with the bankruptcy or reorganization of, or
settlement of delinquent accounts and disputes with, customers and suppliers, in
each case, in the ordinary course of business;
 
(j) in connection with Hedge Agreements that are permitted pursuant to Section
6.2 hereof;
 
(k) Investments in connection with any cash management agreements with PNC or
any other Lender;
 

 
26

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

 

(l) trade credit extended on usual and customary terms in the ordinary course of
business;
 
(m) loans to shareholders, directors or officers in an aggregate amount not to
exceed $500,000 at any one time outstanding;
 
(n) advances to employees to meet expenses incurred by such employees in the
ordinary course of business in an aggregate amount not to exceed $500,000 at any
one time outstanding;
 
(o) Investments existing on the date hereof and set forth on Schedule III
hereto;
 
(p) Permitted Acquisitions;
 
(q) Investments not otherwise provided in clauses (a) through (p) above in an
aggregate amount not to exceed $250,000 outstanding at any one time.
 
“Permitted Liens”:  as defined in Section 6.3.
 
“Person”:  an individual, partnership, corporation, limited liability company,
limited liability partnership, business trust, joint stock company, trust,
unincorporated association, joint venture, Governmental Authority or other
entity of whatever nature.
 
“Plan”:  at a particular time, any employee benefit plan which is covered by
ERISA and in respect of which the Parent, any Subsidiary or a Commonly
Controlled Entity is (or, if such plan were terminated at such time, would under
Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5)
of ERISA.
 
“Pledge Agreement”:  (a) the Pledge Agreement or Agreements, dated as of the
date hereof, to be executed and delivered on the Closing Date and (b) any other
Pledge Agreement between a Loan Party and the Administrative Agent, each
substantially in the form of Exhibit E hereto, as amended, supplemented or
otherwise modified from time to time.
 
“PNC”:  PNC Bank, National Association.
 
“Prime Rate”:  the rate of interest per annum publicly announced from time to
time by PNC as its prime rate in effect at its principal office in Philadelphia,
Pennsylvania, which rate may not be the lowest rate then being charged to
commercial borrowers by PNC; each change in the Prime Rate shall be effective on
the date such change is publicly announced as effective.
 
“Properties”:  the collective reference to the facilities and properties owned,
leased or operated by the Parent and its Subsidiaries.
 
“Proposed New Lender”:  as defined in subsection 2.10(c).
 

 
27

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

 

 “Published Rate”: the rate of interest published each Business Day in The Wall
Street Journal “Money Rates” listing under the caption “London Interbank Offered
Rates” for a one-month period (or, if no such rate is published therein for any
reason, then the Published Rate shall be the eurodollar rate for a one-month
period as published in another publication determined by the Administrative
Agent).
 
 “Purchasing Lender”:  as defined in subsection 9.6(b).
 
“Register”:  as defined in subsection 9.6(d).
 
“Regulations D, T, U and X”:  Regulations D, T, U and X promulgated by the Board
of Governors of the Federal Reserve System (12 C.F.R. Part 204 etseq., 12 C.F.R.
part 220 etseq., 12 C.F.R. Part 221 etseq. and 12 C.F.R. Part 224 etseq.,
respectively), as such regulations are now in effect and as may hereafter be
amended.
 
“Reimbursement Obligations”:  in respect of each Letter of Credit, the
obligation of the Borrower to reimburse the Issuing Bank for all drawings made
thereunder in accordance with subsection 2.4(d) and the Application related to
such Letter of Credit for amounts drawn under such Letter of Credit.
 
“Reorganization”:  with respect to any Multiemployer Plan, the condition that
such plan is in reorganization within the meaning of Section 4241 of ERISA.
 
“Reportable Event”:  any of the events set forth in Section 4043(c)(1), (2),
(4), (5), (6), (10) and (13) of ERISA.
 
“Requested Increase”:  as defined in subsection 2.10(c).
 
 “Required Lenders”:  at any time, such Non-Defaulting Lenders as hold,
individually or collectively, at least (a) 66-2/3% of the sum of (i) the
Revolving Credit Commitments of all Non-Defaulting Lenders at such time and
(ii) the aggregate principal amount of the Term Loans of all Non-Defaulting
Lenders then outstanding, or (b) in the event that the Revolving Credit
Commitments have expired or been terminated, 66-2/3% of the Total Exposure of
all of the Non-Defaulting Lenders at such time.
 
“Requirement of Law”:  as to any Person, the Articles or Certificate of
Incorporation or Formation, By-Laws, partnership agreement, operating agreement
or other organizational or governing documents of such Person, and any law,
treaty, rule or regulation or determination of an arbitrator or a court or other
Governmental Authority, in each case binding upon such Person or any of its
property or to which such Person or any of its property is subject.
 
“Responsible Officer”:  with respect to any Person, the chief executive officer,
president, chief or principal financial officer or controller of such
Person.  Unless otherwise qualified, all references to a “Responsible Officer”
in this Agreement shall refer to a Responsible Officer of the Borrower.
 
 
 
 
28

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

 

        “Revolving Credit Commitment”:  with respect to each Revolving Credit
Lender, the commitment of such Lender to make Revolving Credit Loans and/or
participate in Letters ofCredit or Swing Line Loans in the aggregate amount not
to exceed at any one time outstanding:  (a) as to any Revolving Credit Lender
which is an original signatory to this Agreement, the amount set forth opposite
such Lender’s name on Schedule I hereto under the caption “Revolving Credit
Loans,” as such amount may be increased or decreased from time to time in
accordance with the provisions of this Agreement, or (b) as to any Revolving
Credit Lender which is not an original signatory to this Agreement but which
becomes a Revolving Credit Lender by executing an Assignment and Assumption, the
Revolving Credit Commitment for such Lender set forth on Schedule I to such
Assignment and Assumption, as such amount may be increased or decreased from
time to time in accordance with the provisions of this Agreement.  The aggregate
amount of the Revolving Credit Commitments on the Closing Date is $35,000,000.
 
“Revolving Credit Commitment Percentage”:  as to any Revolving Credit Lender at
any time, the percentage which such Lender’s Revolving Credit Commitment then
constitutes of the aggregate Revolving Credit Commitments of all of the
Revolving Credit Lenders at such time (or, at any time after the Revolving
Credit Commitments shall have expired or been terminated, the percentage which
such Lender’s Revolving Credit Exposure constitutes of the Revolving Credit
Exposure of all of the Revolving Credit Lenders at such time).
 
“Revolving Credit Commitment Period”:  the period from and including the Closing
Date to, but not including, the Revolving Credit Termination Date, or such
earlier date on which the Revolving Credit Commitments shall terminate in their
entirety as provided herein.
 
“Revolving Credit Exposure”:  as to any Revolving Credit Lender at any time, the
sum of (a) the aggregate principal amount of all Revolving Credit Loans made by
such Lender then outstanding, (b) such Lender’s Revolving Credit Commitment
Percentage multiplied by the aggregate principal amount of all Swing Line Loans
then outstanding, and (c) such Lender’s Revolving Credit Commitment Percentage
multiplied by the aggregate Letter of Credit Obligations at such time.
 
“Revolving Credit Lender”:  at any time, any Lender having a Revolving Credit
Commitment and/or outstanding Revolving Credit Loans or Swing Line Loans or
issuing or participating in Letters of Credit or Swing Line Loans.
 
“Revolving Credit Loans”:  as defined in subsection 2.1(a).
 
“Revolving Credit Note”:  as defined in subsection 2.2(a).
 
“Revolving Credit Termination Date”:  the earlier of (a) October 19, 2013 and
(b) the date the Revolving Credit Commitments are terminated in their entirety
as provided herein.
 
“Salary.com”:  Salary.com, Inc., a Delaware corporation.
 
“Salary.com Acquisition”:  the acquisition by Spirit Merger Sub of all of the
outstanding stock of Salary.com. pursuant to the terms of the Salary.com
Acquisition Documents, which acquisition was consummated prior to the Closing
Date.
 

 
29

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

 

“Salary.com Acquisition Documents”:  collectively, the Merger Agreement, the
Top-Up Note (even though it is not outstanding as of the Closing Date) and the
Certificate of Ownership and Merger.
 
 “Salary.com Historical EBITDA”: ($5,600,000), which amount represents the
agreed upon amount of the historical EBITDA of Salary.com and its Subsidiaries
for the four quarter period ending September 30, 2010.
 
 “SEC”:  the Securities and Exchange Commission or any successor governmental
agency thereof.
 
“S&P”:  Standard & Poor’s Rating Group, a division of McGraw-Hill Corporation.
 
“Security”:  “security” as defined in Section 2(1) of the Securities Act of
1933, as amended.
 
“Security Agreement”:  (a) the Security Agreement entered into on the Closing
Date among the Borrower, the Guarantors as of such date and the Administrative
Agent for the benefit of the secured parties thereunder (including the Lenders)
and (b) any other Security Agreement entered into by a Guarantor and the
Administrative Agent, in each case substantially in the form of Exhibit F
hereto, as the same may be amended, supplemented or otherwise modified from time
to time.
 
“Security Documents”:  collectively, any and all of (a) the Security
Agreement(s), (b) the Guaranty(ies), (c) the Pledge Agreement(s) and (d) all
additional documents and instruments entered into from time to time for the
purpose of securing the Obligations, as the foregoing may be amended,
supplemented or otherwise modified from time to time.
 
“Solvent”:  as to any Person, as of the time of determination, the financial
condition under which the following conditions are satisfied:
 
(a) the fair market value of the assets of such Person will exceed the debts and
liabilities, subordinated, contingent or otherwise, of such Person;
 
(b) the present fair saleable value of the Property of such Person will be
greater than the amount that will be required to pay the probable liability of
such Person on its debts and other liabilities, subordinated, contingent or
otherwise, as such debts and other liabilities become absolute and matured;
 
(c) such Person intends and will be able to pay its debts and liabilities,
subordinated, contingent or otherwise, as such debts and liabilities become
absolute and matured; and
 
(d) such Person will not have unreasonably small capital with which to conduct
the business in which it is engaged as such business is then conducted and is
proposed to be conducted after the date thereof.
 

 
30

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

 

“Spirit Merger Sub”:  Spirit Merger Sub, Inc., a Delaware corporation,
predecessor in interest to Salary.com.
 
“Subordinated Debt”:  Indebtedness of the Borrower and its Subsidiaries which is
subordinated to the Obligations in a manner satisfactory to the Administrative
Agent, including that (a) no portion of the principal of such Indebtedness shall
be payable prior to ninety (90) days after the later of the Revolving Credit
Termination Date and the Term Loan Maturity Date, (b) such Indebtedness shall be
unsecured and (c) the subordinated creditor(s) shall be subject to a standstill
period of at least one hundred eighty (180) days with respect to the exercise of
its (or their) remedies following the occurrence of an Event of Default.
 
“Subsidiary”:  as to any Person, a corporation, partnership, limited liability
company or other entity of which shares of stock or other ownership interests
having ordinary voting power (other than stock or such other ownership interests
having such power only by reason of the happening of a contingency) to elect a
majority of the board of directors or other managers of such corporation,
partnership, limited liability company or other entity are at the time owned, or
the management of which is otherwise controlled, directly or indirectly through
one or more intermediaries, or both, by such Person.  Unless otherwise
qualified, all references to a “Subsidiary” or to “Subsidiaries” in this
Agreement shall refer to a Subsidiary or Subsidiaries of the Parent.
 
“Swing Line Collateral Account”: as defined in Section 2.21(c).
 
“Swing Line Lender”:  PNC, and any successor thereto, in its capacity as the
lender of Swing Line Loans hereunder.
 
“Swing Line Loans”:  as defined in Section 2.5(a).
 
“Swing Line Note”:  has the meaning assigned to such term in subsection 2.5(c).
 
“Swing Line Prepayment Date”:  has the meaning assigned to such term in
subsection 2.5(d).
 
“Swing Line Sublimit”:  $2,500,000.
 
“Target”:  Salary.com and its Subsidiaries being acquired pursuant to the
Salary.com Acquisition.
 
“Taxes”:  as defined in Section 2.14(a).
 
“Tender Offer”:  the tender offer by Spirit Merger Sub to purchase all of
Salary.com’s stock, par value $0.0001 per share, including the associated
preferred stock purchase rights under the Spirit Rights Agreement at a price per
share of $4.07, net to the holder in cash without interest, subject to any tax
withholding.
 
“Term Loan”:  as defined in subsection 2.1(b).
 

 
31

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

 

“Term Loan Lender”:  at any time, any Lender which has a Term Loan Commitment or
which holds an outstanding Term Loan.
 
“Term Loan Commitment”:  with respect to each Term Loan Lender, the commitment
of such Lender to make a Term Loan on the Closing Date pursuant to subsection
2.1(b) in an amount not to exceed the amount set forth opposite such Lender’s
name on Schedule I hereto with respect to Term Loans.  The aggregate amount of
the Term Loan Commitments on the Closing Date is $25,000,000.
 
“Term Loan Maturity Date”:  October 19, 2013.
 
“Term Loan Percentage”:  as to any Term Loan Lender, (a) until the funding of
the Term Loans, the percentage which such Lender’s Term Loan Commitment
constitutes of the aggregate Term Loan Commitments of all of the Term Loan
Lenders and (b) thereafter, the percentage which such Lender’s Term Loan
constitutes of the aggregate Term Loans of all of the Term Loan Lenders then
outstanding.
 
“Term Notes”:  as defined in subsection 2.2(b)(i).
 
“Total Debt”:  at any time, all Indebtedness (other than Indebtedness described
in clause (g) of the definition thereof relating to Hedge Agreements) of the
Parent and its Subsidiaries at such time determined on a consolidated basis in
accordance with GAAP and without duplication.
 
“Total Exposure”:  as to any Lender, at any time, the sum of (a) the Revolving
Credit Exposure of such Lender at such time and (b) the aggregate principal
amount of all Term Loans made by such Lender then outstanding.
 
 “Total Net Debt”:  as of the last day of any fiscal quarter (a) Total Debt at
such time minus (b) an amount equal to the excess, if any, of (i) the lesser of
(A) the average daily balance of cash and/or Cash Equivalents maintained by the
Parent and its Subsidiaries in Unrestricted Investment Accounts during such
fiscal quarter and (B) the outstanding balance of cash and Cash Equivalents
maintained by the Parent and its Subsidiaries in Unrestricted Investment
Accounts as of the last day of such fiscal quarter over (ii) seven million five
hundred thousand dollars ($7,500,000).
 
“Total Net Leverage Ratio”: as of the last day of any fiscal quarter, the ratio
of (a) Total Net Debt at such date to (b) Modified EBITDA for the period of four
(4) consecutive fiscal quarters ending on such date.
 
“Total Percentage”:  as to any Lender at any time, the percentage which such
Lender’s Revolving Credit Commitment plus principal amount of Term Loans then
outstanding then constitutes of the aggregate Revolving Credit Commitments and
principal amount of Term Loans then outstanding (or at any time after the
Revolving Credit Commitments shall have expired or been terminated, the
percentage which such Lender’s Total Exposure constitutes of the Total Exposure
of all of the Lenders at such time).
 

 
32

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

 

“Tranche”:  the collective reference to (a) Eurodollar Loans whose Interest
Periods begin on the same date and end on the same later date and are under the
same Facility (whether or not such Loans originally were made on the same date)
and (b) Base Rate Loans (other than Swing Line Loans).
 
“Type”:  when used in respect of any Loan or Borrowing, shall refer to the Rate
by reference to which interest on such Loan or on the Loans comprising such
Borrowing is determined.  For purposes hereof, “Rate” shall include the
Eurodollar Rate and the Base Rate.
 
“Unrestricted Investment Account”:  each domestic investment account maintained
by the Parent and/or a Subsidiary thereof at a Lender or Affiliate thereof and
which has been designated by the Borrower and accepted by the Administrative
Agent as an “Unrestricted Investment Account.”  For the avoidance of doubt, an
operating account shall not constitute an Unrestricted Investment Account.
 
“Unused Revolving Credit Commitment”:  as to any Lender at any particular time
during the Revolving Credit Commitment Period, an amount equal to the excess, if
any, of the Revolving Credit Commitment of such Lender at such time over the
Revolving Credit Exposure of such Lender at such time.
 
“USA Patriot Act”:  the Uniting Strengthening America by Providing Appropriate
Tools Required to Intercept and Obstruct Terrorism Act of 2001, Public Law
107-56, as the same has been, or shall hereafter be, renewed, extended, amended
or replaced.
 
“Withdrawal Liability”:  any withdrawal liability as defined in Section 4201 of
ERISA.
 
1.2 Other Definitional Provisions
 
        (a) Unless otherwise specified therein, all terms defined in this
Agreement shall have the defined meanings when used in the Notes, the other Loan
Documents or any certificate or other document made or delivered pursuant hereto
or thereto.  Except as otherwise provided in this Agreement, all computations
and determinations as to accounting or financial matters and all financial
statements to be delivered pursuant to this Agreement shall be made and prepared
in accordance with GAAP (including principals of consolidation where
appropriate).  As used herein and in the Notes and the other Loan Documents, and
any certificate or other document made or delivered pursuant hereto or thereto,
accounting terms relating to the Parent and its Subsidiaries not defined in
Section 1.1 and accounting terms partly defined in Section 1.1, to the extent
not defined, shall have the respective meanings given to them under
GAAP.  Notwithstanding the foregoing, if the Borrower notifies the
Administrative Agent in writing that the Borrower wishes to amend any covenant
in Section 6.1 of this Agreement, any related definition and/or the definition
of the term Fixed Charge Coverage Ratio for purposes of interest and commitment
fee determinations to eliminate the effect of any change in GAAP occurring after
the Closing Date on the operation of such covenant and/or interest or commitment
fee determinations (or if the Administrative Agent notifies the Borrower in
writing that the Required Lenders wish to amend Section 6.1, any related
definition and/or the definition of the term Fixed Charge Coverage Ratio for
purposes of interest and commitment fee determinations to eliminate the effect
of any such change in GAAP), then the Administrative Agent, the Lenders and the
Borrower shall negotiate in good faith to amend such ratio or requirement to
preserve the original intent thereof in light of such change in GAAP (subject to
the approval of the Required Lenders); provided that, until so amended, the
Borrower’s compliance with such covenant and/or the definition of the term Fixed
Charge Coverage Ratio for purposes of interest and commitment fee determinations
shall be determined on the basis of GAAP in effect immediately before the
relevant change in GAAP became effective, until either such notice is withdrawn
or such covenant or definition is amended in a manner satisfactory to the
Borrower and the Required Lenders, and the Borrower shall provide to the
Administrative Agent, when it delivers its financial statements pursuant to
Section 5.1(a) and (b) of this Agreement, such reconciliation statements as
shall be reasonably requested by the Administrative Agent.
 
                       (b) import when used in this Agreement shall refer to
this Agreement as a whole and not to any particular provision of this Agreement,
and Section, Subsection, Schedule and Exhibit references are to this Agreement
unless otherwise specified.
 
(c) The meanings given to terms defined in this Agreement shall be equally
applicable to both the singular and plural forms of such terms.

 
33

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

 

 
SECTION 2.   LOANS AND TERMS OF COMMITMENTS
 
2.1 Commitments
 
.
(a) Revolving Credit Commitments.  Subject to the terms and conditions hereof,
each Revolving Credit Lender severally agrees to make revolving credit loans
(the “Revolving Credit Loans”) to the Borrower from time to time during the
Revolving Credit Commitment Period in an aggregate principal amount at any one
time outstanding not to exceed the amount of such Lender’s Revolving Credit
Commitment minus such Lender’s Revolving Credit Commitment Percentage of the
principal amount of all Swing Line Loans then outstanding minus such Lender’s
Revolving Credit Commitment Percentage of all Letter of Credit Obligations then
outstanding; provided that no Revolving Credit Loan shall be made if, after
giving effect thereto and the simultaneous application of the proceeds thereof,
the Revolving Credit Exposure of all Revolving Credit Lenders would exceed the
Revolving Credit Commitments of all Revolving Credit Lenders at such time.  If
at any time the aggregate Revolving Credit Exposure of all of the Revolving
Credit Lenders exceeds the Revolving Credit Commitments of all of the Revolving
Credit Lenders at such time, the Borrower shall promptly prepay the excess to
the Administrative Agent, to be applied first to repay the Swing Line Loans,
then to repay the Revolving Credit Loans and then as cash collateral to secure
the Letter of Credit Obligations.  Unless otherwise directed by the Borrower,
payments on Revolving Credit Loans pursuant to the preceding sentence shall be
applied first to Base Rate Loans and then to Eurodollar Loans in the direct
order of maturity.  The Revolving Credit Commitments may be reduced or
terminated from time to time pursuant to Section 2.10.  Within the foregoing
limits, the Borrower may during the Revolving Credit Commitment Period borrow,
repay and reborrow from time to time under the Revolving Credit Commitments,
subject to and in accordance with the terms and limitations hereof.  The failure
of any Revolving Credit Lender to perform its obligations hereunder shall not
relieve any other Revolving Credit Lender of its obligations hereunder (it being
understood, however, that no Revolving Credit Lender shall be responsible for
the failure of any other Revolving Credit Lender to make any Revolving Credit
Loan required to be made by such other Revolving Credit Lender.  Each Revolving
Credit Loan shall be made in accordance with the procedures set forth in Section
2.3.
 
(b) Term Loan Commitments.  Subject to the terms and conditions hereof, each
Term Loan Lender severally agrees to make to the Borrower on the Closing Date a
term loan (hereinafter separately called a “Term Loan” and collectively the
“Term Loans”) in an amount equal to such Term Loan Lender’s Term Loan Percentage
of the aggregate amount of Term Loans requested by the Borrower but not to
exceed such Term Loan Lender’s Term Loan Commitment.  The Term Loan Commitment
of each Term Loan Lender shall terminate on the Closing Date upon the making of
such Term Loan and no portion of a Term Loan which is repaid may be
reborrowed.  Subject to any prepayment obligation provided in this Agreement,
the outstanding principal amount of the Term Loans shall be due and payable in
quarterly principal installments payable on the first day of each calendar
quarter as set forth on Schedule 2.1(b) hereto with all outstanding principal
and accrued interest due and payable on the Term Loan Maturity Date.  The
failure of any Term Loan Lender to perform its obligations hereunder shall not
relieve any other Term Loan Lender of its obligations hereunder (it being
understood, however, that no Term Loan Lender shall be responsible for the
failure of any other Term Loan Lender to make any Term Loan required to be made
by such other Term Loan Lender).
 
2.2 Notes.
 
                                (a) Revolving Credit Notes.  The Revolving
Credit Loans made by each Revolving Credit Lender shall be evidenced by a
promissory note of the Borrower, substantially in the form of Exhibit A-1
hereto, with appropriate insertions as to payee, date and principal amount (as
each may be amended, supplemented or otherwise modified, a “Revolving Credit
Note”), payable to the order of such Revolving Credit Lender and in a principal
amount equal to the amount of the initial Revolving Credit Commitment of such
Revolving Credit Lender.  Each Revolving Credit Lender is hereby authorized to
record the date, Type, and amount of each Revolving Credit Loan made by such
Revolving Credit Lender, and the date and amount of each payment or prepayment
of principal thereof, on the schedule annexed to and constituting a part of its
Revolving Credit Note, provided that the failure of any Revolving Credit Lender
to make such recordation (or any error in such recordation) shall not affect the
obligations of the Borrower hereunder or under such Revolving Credit Note.  Each
Revolving Credit Note shall (a) be dated the Closing Date, (b) be stated to
mature on the Revolving Credit Termination Date and (c) provide for the payment
of interest in accordance with Sections 2.6 and 2.7.
 
(b) Term Notes.  The Term Loan made by each Term Loan Lender shall be evidenced
by a promissory note of the Borrower, substantially in the form of Exhibit A-2
hereto, with appropriate insertions as to payee, date and principal amount (as
each may be amended, supplemented or otherwise modified, a “Term Note”), payable
to the order of such Lender and in a principal amount equal to the principal
amount of such Lender’s Term Loan.  Each Term Loan Lender is hereby authorized
to record the date, Type and amount of the Term Loan made by such Term Loan
Lender, and the date and amount of each payment or prepayment of principal
thereof, on the schedule annexed to and constituting a part of its Term Note,
provided that the failure of any Term Loan Lender to make such recordation (or
any error in such recordation) shall not affect the obligations of the Borrower
hereunder or under such Term Note.  Each Term Note shall (a) be dated the
Closing Date, (b) be stated to mature on the Term Loan Maturity Date and (c)
provide for the payment of interest in accordance with Sections 2.6 and 2.7
hereof.
 

 
34

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

 
 
 
2.3 Procedure for Revolving Credit Loans and Term Loans.
 
                                The Borrower may borrow (a) under the Revolving
Credit Commitments from time to time during the Revolving Credit Commitment
Period on any Business Day and (b) Term Loans only on the Closing Date.  The
Borrower shall give the Administrative Agent a Notice of Borrowing (a) in the
case of a Eurodollar Borrowing, not later than 10:30 a.m., Philadelphia time,
three (3) Business Days before such proposed Borrowing and (b) in the case of a
Base Rate Borrowing, not later than 10:30 a.m., Philadelphia time, on the day of
such proposed Borrowing.  All Loans borrowed on the Closing Date shall initially
be Base Rate Loans, provided that such Loans can be converted thereafter to
Eurodollar Loans in accordance with the terms hereof.  Such Notice of Borrowing
shall be irrevocable and shall in each case specify (a) whether the Borrowing
then being requested is to be a Revolving Credit Loan or Term Loan; (b) the date
of such Borrowing (which shall be a Business Day) and the amount thereof; and
(c) if such Borrowing is to be a Eurodollar Borrowing, the Interest Period with
respect thereto.  If no election as to the Type of Borrowing is specified in any
such notice, then the requested Borrowing shall be a Base Rate Borrowing.  If no
Interest Period with respect to any Eurodollar Borrowing is specified in any
such notice, then the Borrower shall be deemed to have selected an Interest
Period of one month’s duration.  Each borrowing under the Revolving Credit
Commitments shall be in a minimum amount equal to (x) with respect to Eurodollar
Borrowings, $500,000 or in integral multiples of $500,000 in excess thereof and
(y) with respect to Base Rate Borrowings, $500,000 or in integral multiples of
$100,000 in excess thereof (or, with respect to Base Rate Borrowings, if the
aggregate Unused Revolving Credit Commitments at such time are less than
$500,000, such lesser amount, as applicable).
 
Upon receipt of a Notice of Borrowing from the Borrower, the Administrative
Agent shall promptly notify each Revolving Credit Lender or Term Loan Lender, as
applicable, of such request.  Each Revolving Credit Lender or Term Loan Lender,
as the case may be, will make the amount of its prorata share of such Borrowing
(based on its Revolving Credit Commitment Percentage or Term Loan Percentage, as
the case may be, at that time) available to the Administrative Agent for the
account of the Borrower at the office of the Administrative Agent specified in
Section 9.2 prior to 2:00 p.m., Philadelphia time, on the Borrowing Date
requested by the Borrower in funds immediately available to the Administrative
Agent.  Such Borrowing will then be made available to the Borrower by the
Administrative Agent crediting the account of the Borrower on the books of the
Administrative Agent with the aggregate of the amounts made available to the
Administrative Agent by the Lenders and in like funds as received by the
Administrative Agent.
 
Unless the Administrative Agent shall have received notice from a Revolving
Credit Lender or Term Loan Lender, as the case may be, prior to the date of any
borrowing of Revolving Credit Loans or Term Loans, as applicable, that such
Lender will not make available to the Administrative Agent such Lender’s prorata
portion of such Borrowing, the Administrative Agent may assume that such Lender
has made such portion available to the Administrative Agent on the date of such
borrowing in accordance with this subsection and the Administrative Agent may,
in reliance upon such assumption, make available to the Borrower on such date a
corresponding amount.  If and to the extent that such Lender shall not have made
such portion available to the Administrative Agent, such Lender and the Borrower
(without prejudice to the Borrower’s rights against such Lender) severally agree
to repay to the Administrative Agent forthwith on demand such corresponding
amount together with interest thereon, for each day from the date such amount is
made available to the Borrower until the date such amount is repaid to the
Administrative Agent at (i) in the case of the Borrower, the interest rate
applicable at the time to the Revolving Credit Loans or Term Loans, as the case
may be, comprising such Borrowing and (ii) in the case of such Lender, the
Federal Funds Effective Rate, provided, that, if such Lender shall not pay such
amount within three (3) Business Days of such Borrowing Date, the interest rate
on such overdue amount shall, at the expiration of such three-Business Day
period, be the rate per annum applicable to the Revolving Credit Loans or the
Term Loans, as the case may be, comprising such Borrowing.  If such Lender shall
repay to the Administrative Agent such corresponding amount, such amount shall
constitute such Lender’s Revolving Credit Loan or Term Loan, as the case may be,
as part of such Borrowing for purposes of this Agreement.
 

 
35

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

 

                                 2.4 Letter of Credit Subfacility.
 
                                 (a) During the Revolving Credit Commitment
Period, the Borrower may request the issuance of standby Letters of Credit to
support obligations of the Borrower and its Subsidiaries which finance the
working capital and business needs of the Borrower and its Subsidiaries by
delivering to the Issuing Bank a completed Application for letters of credit in
such form and with such other certificates, documents and information as the
Issuing Bank may specify from time to time by no later than 12:00 noon,
Philadelphia time, at least five (5) Business Days (or such shorter period as
may be agreed to by the Issuing Bank) in advance of the proposed date of
issuance.  Each Application for issuance of a Letter of Credit shall be
accompanied by an issuance fee based upon the Issuing Bank’s standard schedule
of fees charged for issuing letters of credit as such may be amended from time
to time.  Subject to the terms and conditions hereof and in reliance on the
agreements of the other Revolving Credit Lenders set forth in this Section, the
Issuing Bank will issue a Letter of Credit, provided, that each Letter of Credit
shall (i) have a maximum maturity of twelve (12) months from the date of
issuance, and (ii) in no event expire later than five (5) Business Days prior to
the Revolving Credit Termination Date, and provided further, that in no event
shall (x) the amount of the Letter of Credit Obligations at any one time exceed
the lesser of (A) the L/C Sublimit and (B) the aggregate Revolving Credit
Commitments minus the aggregate principal amount of the Revolving Credit Loans
and Swing Line Loans then outstanding and (y) the sum of (I) the principal
amount of the Revolving Credit Loans made by any Revolving Credit Lender then
outstanding and (II) such Lender’s Revolving Credit Commitment Percentage of (A)
all Letter of Credit Obligations then outstanding and (B) the principal amount
of all Swing Line Loans then outstanding, exceed such Lender’s Revolving Credit
Commitment at such time.  The Issuing Bank shall not at any time be obligated to
issue any Letter of Credit hereunder if such issuance would conflict with, or
cause the Issuing Bank or any Letter of Credit Participant to exceed, any limits
imposed by any applicable Requirement of Law.  Notwithstanding the provisions of
this Section, the Revolving Credit Lenders and the Borrower hereby agree that
the Issuing Bank may issue upon the Borrower’s request, one or more Letter(s) of
Credit which by its or their terms may be extended for additional periods of up
to one year each provided that (I) the initial expiration date (or any
subsequent expiration date) of each such Letter of Credit is not later than five
(5) Business Days prior to the Revolving Credit Termination Date, and
(II) renewal of such Letter(s) of Credit, at the Issuing Bank’s discretion,
shall be available upon written request from the Borrower to the Issuing Bank at
least thirty (30) days (or such other time period as agreed by the Borrower and
the Issuing Bank) before the date upon which notice of renewal is otherwise
required.  Each standby Letter of Credit shall be subject either to the Uniform
Customs and Practice for Documentary Credits as most recently published by the
International Chamber of Commerce at the time a Letter of Credit is issued
(“UCP”) or the International Standby Practices (ISP98 International Chamber of
Commerce Publication Number 590 (“ISP98”)), as determined by the Issuing Bank.
 
(b) The Borrower shall pay (i) to the Administrative Agent for the ratable
account of the Revolving Credit Lenders a fee (the “Letter of Credit Fee”) equal
to the amount of the Applicable Margin for Revolving Credit Loans that are
Eurodollar Loans in effect from time to time multiplied by the daily average of
the undrawn face amount of each Letter of Credit during the preceding fiscal
quarter (or shorter period commencing with the Closing Date or ending on the
Revolving Credit Termination Date) and (ii) to the Issuing Bank a fronting fee
(the “Fronting Fee”) of twelve and one-half basis points (.125%) multiplied by
the daily average of the undrawn face amount of each Letter of Credit during the
preceding fiscal quarter (or shorter period commencing with the Closing Date or
ending on the Revolving Credit Termination Date).  The Letter of Credit Fee and
the Fronting Fee shall be payable quarterly in arrears on each January 1,
April 1, July 1 and October 1 commencing with January 1, 2011 and on the
Revolving Credit Termination Date.  The Borrower shall also pay to the Issuing
Bank the Issuing Bank’s then in effect customary fees and administrative
expenses payable with respect to each Letter of Credit issued or renewed by it
as the Issuing Bank may generally charge from time to time.  Once paid, all of
the above fees shall be nonrefundable under all circumstances.  All periodic
interest, fees and commissions shall be calculated on the basis of the actual
days elapsed in a 360 day year.
 
(c) (i)  The Issuing Bank irrevocably agrees to grant and hereby grants to each
Letter of Credit Participant, and, to induce the Issuing Bank to issue Letters
of Credit hereunder, each Revolving Credit Lender irrevocably agrees to accept
and purchase and hereby accepts and purchases from the Issuing Bank, on the
terms and conditions hereinafter stated, for such Letter of Credit Participant’s
own account and risk, an undivided interest equal to such Letter of Credit
Participant’s Revolving Credit Commitment Percentage in the Issuing Bank’s
obligations and rights under each Letter of Credit issued by the Issuing Bank
(including the Existing Letters of Credit) and the amount of each draft paid by
the Issuing Bank thereunder.  Each Letter of Credit Participant unconditionally
and irrevocably agrees with the Issuing Bank that, if a draft is paid under any
Letter of Credit issued by the Issuing Bank for which the Issuing Bank is not
reimbursed in full by the Borrower in accordance with the terms of this
Agreement, such Letter of Credit Participant shall pay to the Issuing Bank upon
demand at the Issuing Bank’s address for notices specified herein an amount
equal to such Letter of Credit Participant’s share (based on its Revolving
Credit Commitment Percentage) of (x) the amount of such draft or any part
thereof, which is not so reimbursed and (y) any taxes, fees, charges or other
costs or expenses incurred by the Issuing Bank in connection with such
payment.  Any action taken or omitted by the Issuing Bank under or in connection
with a Letter of Credit, if taken or omitted in the absence of gross negligence
or willful misconduct, shall not create for the Issuing Bank any resulting
liability to any Lender.
 

 
36

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

 
 
(ii) If any amount required to be paid by any Letter of Credit Participant to
the Issuing Bank pursuant to subsection 2.4(c)(i) in respect of any unreimbursed
portion of any payment made by the Issuing Bank under any Letter of Credit is
not paid to the Issuing Bank on the date such payment is due from such Letter of
Credit Participant, such Letter of Credit Participant shall pay to the Issuing
Bank on demand an amount equal to the product of (x) such amount, times (y) the
daily average Federal Funds Effective Rate, as quoted by the Issuing Bank,
during the period from and including the date such payment is required to the
date on which such payment is immediately available to the Issuing Bank, times
(z) a fraction the numerator of which is the number of days that elapse during
such period and the denominator of which is 360.  A certificate of the Issuing
Bank submitted to any Letter of Credit Participant with respect to any amounts
owing under this subsection shall be conclusive in the absence of manifest
error.
 
(iii) Whenever, at any time after the Issuing Bank has made payment under any
Letter of Credit and has received from any Letter of Credit Participant its
prorata share of such payment in accordance with subsection 2.4(c)(i), the
Issuing Bank receives any payment related to such Letter of Credit (whether
directly from the Borrower or otherwise, including by way of set-off or proceeds
of collateral applied thereto by the Issuing Bank), or any payment of interest
on account thereof, the Issuing Bank will distribute to such Letter of Credit
Participant its prorata share thereof; provided, however, that in the event that
any such payment received by the Issuing Bank shall be required to be returned
by the Issuing Bank, such Letter of Credit Participant shall return to the
Issuing Bank the portion thereof previously distributed by the Issuing Bank to
it.
 
(d) (i) The Borrower agrees to reimburse the Issuing Bank in respect of a Letter
of Credit (including an Existing Letter of Credit) on each date on which a draft
presented under such Letter of Credit is paid by the Issuing Bank for the amount
of (a) such draft so paid and (b) any taxes, fees, charges or other costs or
expenses incurred by the Issuing Bank in connection with such payment.  Each
such payment shall be made to the Issuing Bank in immediately available
funds.  Notwithstanding any other provisions of this Agreement, unless other
acceptable arrangements for the immediate reimbursement by the Borrower of
amounts required to be advanced by the Issuing Bank pursuant to a Letter of
Credit have been made by the Borrower and the Issuing Bank and such
reimbursement is made by the Borrower, any and all amounts which the Issuing
Bank is required to advance pursuant to a Letter of Credit shall, at the option
of the Issuing Bank, become, at the time the amounts are advanced, Revolving
Credit Loans from the Revolving Credit Lenders made as a Base Rate
Borrowing.  The Administrative Agent will notify the Revolving Credit Lenders of
the amount required to be advanced pursuant to the Letters of Credit.  Before
10:00 A.M. (Philadelphia time) on the date of any advance the Revolving Credit
Lenders are required to make pursuant to the Letters of Credit, each Revolving
Credit Lender shall make available to the Administrative Agent such Revolving
Credit Lender’s Revolving Credit Commitment Percentage of such advance in
immediately available funds.
 
(ii) Interest shall be payable on any and all amounts remaining unpaid by the
Borrower under this subsection from the date such amounts become payable
(whether at stated maturity, by acceleration or otherwise) until payment in full
at the per annum rate of the then applicable Default Rate for Revolving Credit
Loans which are Base Rate Loans and shall be payable on demand by the Issuing
Bank.
 

 
37

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

 

(e) (i)  The Borrower also agrees with the Issuing Bank that the Issuing Bank
shall not be responsible for, and the Borrower’s Reimbursement Obligations under
subsection 2.4(d)(i) shall not be affected by, among other things (x) the
validity or genuineness of documents or of any endorsements thereon, even though
such documents shall in fact prove to be invalid, fraudulent or forged,
provided, that reliance upon such documents by the Issuing Bank shall not have
constituted gross negligence or willful misconduct of the Issuing Bank or
(y) any dispute between or among the Borrower and any beneficiary of any Letter
of Credit or any other party to which such Letter of Credit may be transferred
or (z) any claims whatsoever of the Borrower against any beneficiary of such
Letter of Credit or any such transferee.
 
(ii) The Issuing Bank shall not be liable for any error, omission, interruption
or delay in transmission, dispatch or delivery of any message or advice, however
transmitted, in connection with any Letter of Credit, except for errors or
omissions caused by the Issuing Bank’s gross negligence or willful misconduct.
 
(iii) The Borrower agrees that any action taken or omitted by the Issuing Bank
under or in connection with any Letter of Credit or the related drafts or
documents, if done in the absence of gross negligence or willful misconduct,
shall be binding on the Borrower and shall not result in any liability of the
Issuing Bank to the Borrower.
 
(f) If any draft shall be presented for payment to the Issuing Bank under any
Letter of Credit, the Issuing Bank shall promptly notify the Borrower of the
date and amount thereof.  The responsibility of the Issuing Bank to the Borrower
in connection with any draft presented for payment under any Letter of Credit
shall, in addition to any payment obligation expressly provided for in such
Letter of Credit and any other obligation expressly imposed by UCP or ISP98 as
applicable to such Letter of Credit, be limited to determining that the
documents (including each draft) delivered under such Letter of Credit in
connection with such presentment are in conformity with such Letter of Credit.
 
(g) To the extent that any provision of any Application related to any Letter of
Credit is inconsistent with the provisions of this Agreement, the provisions of
this Agreement shall govern.
 
(h) Subject to subsection 2.4(g) above, the Borrower agrees to be bound by the
terms of each Application and the Issuing Bank’s written regulations and
customary practices relating to letters of credit, though such interpretation
may be different from the Borrower’s own.  It is understood and agreed that,
except in the case of gross negligence or willful misconduct, the Issuing Bank
shall not be liable for any error, negligence and/or mistakes, whether of
omission or commission, in following the Borrower’s instructions or those
contained in the Letters of Credit or any modifications, amendments or
supplements thereto.
 
(i) Each Revolving Credit Lender’s payment obligation under subsection 2.4(c)
and the Reimbursement Obligations shall be absolute, unconditional and
irrevocable under any circumstances, and shall be performed strictly in
accordance with the terms of this Section 2.4 under all circumstances, including
the following circumstances:
 

 
38

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

 
 
                                                 (i) any set-off, counterclaim,
recoupment, defense or other right which such Revolving Credit Lender may have
against the Issuing Bank, any Loan Party or any other Person for any reason
whatsoever;
 
                                                 (ii) any lack of validity or
enforceability of any Letter of Credit;
 
                                                (iii) the existence of any
claim, set-off, defense or other right which any Loan Party or any Revolving
Credit Lender may have at any time against a beneficiary or any transferee of
any Letter of Credit (or any Persons for whom any such transferee may be
acting), the Issuing Bank or any Revolving Credit Lender or any other Person,
whether in connection with this Agreement, the transactions contemplated herein
or any unrelated transaction (including any underlying transaction between any
Loan Party and the beneficiary for which any Letter of Credit was procured);
 
                                                (iv) any draft, demand,
certificate or other document presented under any Letter of Credit proving to be
forged, fraudulent, invalid or insufficient in any respect or any statement
therein being untrue or inaccurate in any respect even if the Issuing Bank has
been notified thereof;
 
(v) payment by the Issuing Bank under any Letter of Credit against presentation
of a demand, draft or certificate or other document which does not comply with
the terms of such Letter of Credit, provided that such payment shall not have
constituted gross negligence or willful misconduct on the part of the Issuing
Bank;
 
(vi) any adverse change in the business, operations, properties, assets,
condition (financial or otherwise) or prospects of the Parent and its
Subsidiaries;
 
(vii) any breach of this Agreement or any other Loan Document by any Loan Party;
 
(viii) the occurrence or continuance of an insolvency proceeding with respect to
any Loan Party;
 
(ix) the fact that an Event of Default or a Default shall have occurred and be
continuing;
 
(x) the fact that the Revolving Credit Termination Date shall have passed or
this Agreement or the Revolving Credit Commitments hereunder shall have been
terminated; and
 
(xi) any other circumstance or happening whatsoever, whether or not similar to
any of the foregoing.
 
(j) In addition to amounts payable as provided in Section 9.5, the Borrower
hereby agrees to protect, indemnify, pay and save harmless the Issuing Bank, the
Agents and the Lenders from and against any and all claims, demands,
liabilities, damages, losses, costs, charges and expenses (including reasonable
fees, expenses and disbursements of counsel) which the Issuing Bank or the
Lenders may incur or be subject to as a consequence, direct or indirect, of
(i) the issuance of any Letter of Credit, other than as a result of (A) the
gross negligence or willful misconduct of the Issuing Bank as determined by a
final judgment of a court of competent jurisdiction or (B) subject to the
following clause (ii), the wrongful dishonor by the Issuing Bank of a proper
demand for payment made under any Letter of Credit, or (ii) the failure of the
Issuing Bank to honor a drawing under any such Letter of Credit as a result of
any act or omission, whether rightful or wrongful, of any present or future
de jure or de facto government or governmental authority (all such acts or
omissions herein called “Governmental Acts”).
 

 
39

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

 

                                 (k) As among the Borrower and the Issuing Bank,
the Borrower assumes all risks of the acts and omissions of, or misuse of the
Letters of Credit by, the respective beneficiaries of such Letters of
Credit.  In furtherance and not in limitation of the foregoing, the Issuing Bank
shall not be responsible for:  (i) the form, validity, sufficiency, accuracy,
genuineness or legal effect of any document submitted by any party in connection
with the application for an issuance of or drawing under any such Letter of
Credit, even if it should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged (even if the Issuing Bank shall
have been notified thereof); (ii) the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign any such Letter of
Credit or the rights or benefits thereunder or proceeds thereof, in whole or in
part, which may prove to be invalid or ineffective for any reason; (iii) the
failure of the beneficiary of any such Letter of Credit, or any other party to
which such Letter of Credit may be transferred, to comply fully with any
conditions required in order to draw upon such Letter of Credit or any other
claim of any Loan Party against any beneficiary of such Letter of Credit, or any
such transferee, or any dispute between or among any Loan Party and any
beneficiary of any Letter of Credit or any such transferee; (iv) errors,
omissions, interruptions or delays in transmission or delivery of any messages,
by mail, facsimile, cable, telex or otherwise; (v) errors in interpretation of
technical terms; (vi) any loss or delay in the transmission or otherwise of any
document required in order to make a drawing under any such Letter of Credit or
of the proceeds thereof; (vii) the misapplication by the beneficiary of any such
Letter of Credit of the proceeds of any drawing under such Letter of Credit; or
(viii) any consequences arising from causes beyond the control of the Issuing
Bank, including any Governmental Acts, and none of the above shall affect or
impair, or prevent the vesting of, any of the Issuing Bank’s rights or powers
hereunder.
 
In furtherance and extension and not in limitation of the specific provisions
set forth above, any action taken or omitted by the Issuing Bank under or in
connection with the Letters of Credit issued by it or any documents and
certificates delivered thereunder, if taken or omitted in good faith, shall not
create any liability of the Issuing Bank to the Borrower or any Lender.
 
(l) Notwithstanding anything to the contrary herein, the Existing Letters of
Credit shall be considered Letters of Credit issued hereunder.
 
 
40

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

 
 
2.5 Swing Line Loans
.
(a) Subject to the terms and conditions hereof, during the Revolving Credit
Commitment Period, the Swing Line Lender may, in its discretion, from time to
time at the

request of the Borrower make swing line loans to the Borrower (the “Swing Line
Loans”) in an aggregate outstanding principal amount not to exceed the Swing
Line Sublimit; provided, that, no Swing Line Loan shall be made to the Borrower
if, after giving effect to the making of such Swing Line Loan and the
simultaneous application of the proceeds thereof (x) the outstanding principal
amount of any Revolving Credit Lender’s Revolving Credit Loans plus such
Lender’s Revolving Credit Commitment Percentage of (i) the Letter of Credit
Obligations then outstanding and (ii) the principal amount of the Swing Line
Loans then outstanding shall exceed such Lender’s Revolving Credit Commitment,
or (y) the aggregate outstanding principal amount of the Revolving Credit Loans
and Swing Line Loans plus the Letter of Credit Obligations outstanding at such
time shall exceed the aggregate Revolving Credit Commitments of all Revolving
Credit Lenders at such time.  Within the foregoing limits, the Borrower may
during the Revolving Credit Commitment Period borrow, repay and reborrow under
the Swing Line Sublimit, subject to and in accordance with the terms and
limitations hereof.  Each Swing Line Loan shall be in an original principal
amount of $100,000 or in integral multiples of $50,000 in excess thereof.  The
interest rate for a Swing Line Loan shall be (i) the Base Rate plus the
Applicable Margin for Base Rate Loans that are Revolving Credit Loans, (ii) such
rate that is mutually agreed to by the Borrower and the Swing Line Lender in
writing at the time such Swing Line Loan is made or (iii) if a Cash Management
Agreement (as defined in clause (h) below) is in effect, at the rate determined
in accordance with such Cash Management Agreement(s) plus the Applicable Margin
for Revolving Credit Loans that are Eurodollar Loans.  Interest on the Swing
Line Loans shall be paid in accordance with Sections 2.6 and 2.7 hereof.  Swing
Line Loans shall be repaid on the Revolving Credit Termination Date and as
otherwise provided in this Section 2.5.
 
(b) Subject to the terms of Section 2.5(g) hereof, the Borrower may request a
Swing Line Loan to be made on any Business Day.  Each request for a Swing Line
Loan shall be in the form of a Notice of Borrowing (or a request by telephone
immediately confirmed in writing, it being understood that the Swing Line Lender
may rely on the authority of any individual making such telephonic request
without the necessity of receipt of such written confirmation) and received by
the Swing Line Lender not later than 1:00 p.m. (Philadelphia time) on the
Business Day such Swing Line Loan is to be made (or such later time as the Swing
Line Lender shall agree), specifying in each case (i) the amount to be borrowed
and (ii) the requested borrowing date.  The request for such Swing Line Loan
shall be irrevocable.  Provided that all applicable conditions precedent
contained herein have been satisfied, the Swing Line Lender may, not later than
4:00 p.m., Philadelphia time, on the date specified in the Borrower’s request
for such Swing Line Loan, make such Swing Line Loan by crediting the Borrower’s
deposit account with the Swing Line Lender.
 
(c) The obligation of the Borrower to repay its Swing Line Loans shall be
evidenced by a promissory note of the Borrower dated the date hereof, payable to
the order of the Swing Line Lender in the principal amount of the Swing Line
Sublimit and substantially in the form of Exhibit A-3 (as amended, supplemented
or otherwise modified from time to time, the “Swing Line Note”).
 
 
 
41

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

 
 
                                 (d) The Borrower shall have the right at any
time and from time to time to prepay the Swing Line Loans, in whole or in part,
without premium or penalty (but in any event subject to Section 2.15, except in
the case of Swing Line Loans bearing interest based on the

Base Rate) upon prior written, facsimile or telephonic notice to the Swing Line
Lender given no later than 10:00 a.m., Philadelphia time, on the date of any
proposed prepayment (each such date, a “Swing Line Prepayment Date”).  Each
notice of prepayment shall specify the amount to be prepaid (which, except in
the case of payment in full, shall be in the principal amount of $100,000 or in
integral multiples of $50,000 in excess thereof), shall be irrevocable and shall
commit the Borrower to prepay such amount on such date, with accrued interest
thereon and any amounts owed under Section 2.15 hereof.  Unless the Borrower
shall have notified the Administrative Agent prior to 10:00 a.m., Philadelphia
time, that the Borrower intends to prepay such Swing Line Loan with funds other
than the proceeds of a Revolving Credit Loan or shall have requested in
accordance with Section 2.3 the making of a Eurodollar Loan to make such
prepayment, the Borrower shall be deemed to have given notice to the
Administrative Agent requesting the Revolving Credit Lenders to make on such
Swing Line Prepayment Date Revolving Credit Loans which shall be Base Rate Loans
in an aggregate amount equal to the amount of such Swing Line Loan plus interest
thereon.  In such event, subject to the satisfaction or waiver of the conditions
specified in Section 4.2, the Revolving Credit Lenders shall, on such Swing Line
Prepayment Date, make Revolving Credit Loans, which shall be Base Rate Loans, in
an aggregate amount equal to the amount of such Swing Line Loan plus accrued
interest thereon, the proceeds of which shall be applied directly by the
Administrative Agent to repay the Swing Line Lender for such Swing Line Loan
plus accrued interest thereon; provided, that if for any reason the proceeds of
such Revolving Credit Loans are not received by the Swing Line Lender on such
Swing Line Prepayment Date in an aggregate amount equal to the amount of such
Swing Line Loan being prepaid plus accrued interest thereon, the Borrower shall
reimburse the Swing Line Lender on the Business Day immediately following such
Swing Line Prepayment Date, in same day funds, in an amount equal to the excess
of the amount of such Swing Line Loan and accrued interest thereon over the
aggregate amount of such Revolving Credit Loans, if any, received.
 
(e) In the event the Revolving Credit Commitments are terminated in accordance
with the terms hereof, the Swing Line Sublimit shall automatically be reduced to
zero.  In the event the Borrower reduces the aggregate Revolving Credit
Commitments to less than the Swing Line Sublimit, the Swing Line Sublimit shall
immediately be reduced to an amount equal to the aggregate Revolving Credit
Commitments.  In the event the Borrower reduces the aggregate Revolving Credit
Commitments to less than the outstanding principal amount of the Swing Line
Loans, the Borrower shall immediately repay the amount by which the outstanding
Swing Line Loans exceeds the Swing Line Sublimit as so reduced plus accrued
interest thereon and any amounts owed under Section 2.15 hereof.
 
(f) In the event that the Borrower shall fail to repay the Swing Line Lender
(i) the outstanding Swing Line Loans together with all accrued interest thereon
on the Revolving Credit Termination Date, (ii) the amount of any Swing Line Loan
due on any Swing Line Prepayment Date, or (iii) any amounts required under
subsection 2.5(e), the Administrative Agent shall promptly notify each Revolving
Credit Lender of the unpaid amount of such Swing Line Loan (including accrued
interest thereon) and of such Revolving Credit Lender’s respective participation
therein in an amount equal to such Revolving Credit Lender’s Revolving Credit
Commitment Percentage of such amount.  Each Revolving Credit Lender shall make
available to the Administrative Agent for payment to the Swing Line Lender an
amount equal to its respective participation therein (including, without
limitation, its pro rata share of accrued but unpaid interest thereon, provided
that the interest rate payable by the Revolving Credit Lenders shall not exceed
the Base Rate, in same day funds, at the office of the Administrative Agent
specified in such notice.  If such notice is delivered by the Administrative
Agent by 11:00 a.m., Philadelphia time, each Revolving Credit Lender shall make
funds available to the Administrative Agent on that Business Day.  If such
notice is delivered after 11:00 a.m., Philadelphia time, each Revolving Credit
Lender shall make funds available to the Administrative Agent on the next
Business Day.  In the event that any Revolving Credit Lender fails to make
available to the Administrative Agent the amount of such Revolving Credit
Lender’s participation in such unpaid amount as provided herein, the Swing Line
Lender shall be entitled to recover such amount on demand from such Revolving
Credit Lender together with interest thereon at a rate per annum equal to the
Federal Funds Effective Rate for each day during the period between the Business
Day such payment is due in accordance with the terms of this subsection 2.5(f)
and the date on which such Revolving Credit Lender makes available its
participation in such unpaid amount.  The failure of any Revolving Credit Lender
to make available to the Administrative Agent its Revolving Credit Commitment
Percentage of any such unpaid amount shall not relieve any other Revolving
Credit Lender of its obligations hereunder to make available to the
Administrative Agent its Revolving Credit Commitment Percentage of such unpaid
amount on the Business Day such payment is due in accordance with the terms of
this subsection 2.5(f).  The Administrative Agent shall promptly distribute to
each Revolving Credit Lender which has paid all amounts payable by it under this
Section 2.5(f) with respect to the unpaid amount of any Swing Line Loan, such
Lender’s Revolving Credit Commitment Percentage of all payments received by the
Administrative Agent from the Borrower in repayment of such Swing Line Loan when
such payments are received; provided, however, that in the event that any
payment received by the Revolving Credit Lenders shall be required to be
returned by the Swing Line Lender, any Revolving Credit Lender receiving any
portion of such payment shall be required to return to the Swing Line Lender
such portion thereof previously distributed to it.  Notwithstanding anything to
the contrary herein, each Revolving Credit Lender which has paid all amounts
payable by it under this Section 2.5(f) shall have a direct right to repayment
of such amounts from the Borrower subject to the procedures for repaying
Revolving Credit Lenders set forth in this Section 2.5(f) and the provisions of
Section 9.7.
 

 
42

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

 
 
(g) Without the requirement for a specific request from the Borrower pursuant to
subsection 2.5(b), the Swing Line Lender may make Swing Line Loans to the
Borrower in accordance with the provisions of any agreements between the
Borrower and the Swing Line Lender relating to the Borrower’s deposit, sweep and
other accounts at the Swing Line Lender and related arrangements and agreements
regarding the management and investment of the Borrower’s cash assets as in
effect from time to time (as they may be amended, restated or modified from time
to time, each a “Cash Management Agreement” and collectively, the “Cash
Management Agreements”) to the extent of the daily aggregate net negative
balance in the Borrower’s accounts which are subject to the provisions of a Cash
Management Agreement.  Swing Line Loans made pursuant to this subsection 2.5(g)
in accordance with the provisions of a Cash Management Agreement shall (i) be
subject to the limitations as to aggregate amount set forth in subsection
2.5(a), (ii) not be subject to the limitations as to individual amount set forth
in subsection 2.5(a), (iii) be payable by the Borrower, both as to principal and
interest, at the times set forth in the Cash Management Agreements (but in no
event later than the Revolving Credit Termination Date), (iv) not be made at any
time after the Swing Line Lender has written notice of the occurrence and during
the continuance of a Default or Event of Default, (v) if not repaid by the
Borrower in accordance with the provisions of the applicable Cash Management
Agreement, be subject to each Revolving Credit Lender’s obligation to purchase
participating interests therein pursuant to subsection 2.5(f), and (vi) except
as provided in the foregoing subsections (i) through (v), be subject to all of
the terms and conditions of this Section 2.5.  If a Cash Management Agreement is
in effect, Swing Line Loans shall only be made pursuant to the Cash Management
Agreements.
 
(h) The Borrower hereby indemnifies the Swing Line Lender, its Affiliates and
their respective directors, officers, agents and employees against any cost,
expense (including reasonable counsel fees and out-of-pocket expenses), claim,
demand, action, loss or liability (except, with respect to any indemnitee, any
of the foregoing that results from such indemnitee’s gross negligence or willful
misconduct as determined by a final nonappealable judgment of a court of
competent jurisdiction) that such indemnitees may suffer or incur in connection
with this Section 2.5 or any action taken or omitted by such indemnitees
hereunder.
 
2.6 Interest and Payment Dates.
 
                                 (a)  Subject to the provisions of Section 2.7,
each Base Rate Loan shall bear interest (computed on the basis of the actual
number of days elapsed over a year of 365 or 366 days, as the case may be) at a
rate per annum equal to the Base Rate plus the Applicable Margin.
 
(b) Subject to the provisions of Section 2.7, each Eurodollar Loan shall bear
interest (computed on the basis of the actual number of days elapsed over a year
of 360 days) at a rate per annum equal to the Eurodollar Rate for the Interest
Period in effect for such Loan plus the Applicable Margin.
 
(c) Subject to the provisions of Section 2.7, interest on each Swing Line Loan
shall be payable at the rate (computed on the basis of the actual number of days
elapsed over a year of 360 days) provided in Section 2.5.
 
(d) Interest on each Loan shall be payable on each Interest Payment Date
applicable to such Loan; provided that, (i) interest accruing on overdue amounts
pursuant to Section 2.7 shall be payable on demand as provided in such Section
and (ii) with respect to any Swing Line Loan made under a Cash Management
Agreement, interest on such Swing Line Loan shall be payable as provided in
Section 2.5(g).  The Eurodollar Rate and the Base Rate shall be determined by
the Administrative Agent, and such determination shall be conclusive absent
manifest error.
 
2.7 Default Interest.
 
To the extent not contrary to any Requirement of Law, upon the occurrence and
during the continuation of an Event of Default, any principal, past due
interest, fee or other amount outstanding hereunder shall bear interest for each
day thereafter until paid in full (after as well as before judgment) at a rate
per annum which shall be equal to two percent (2%) in excess of the rate which
would otherwise be in effect for Base Rate Loans (such rate being referred to as
the “Default Rate”); provided that, with respect to Eurodollar Loans, such rate
shall be the higher of the Default Rate and two percent (2%) in excess of the
rate which would otherwise be applicable to such Eurodollar Loan.  The Borrower
acknowledges that such increased interest rate reflects, among other things, the
fact that such loans or other amounts have become a substantially greater risk
given their default status and that the Lenders are entitled to additional
compensation for such risk.
 

 
43

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

 
 
2.8 Conversion and Continuation Options; Limitations on Tranches.
 
                                 (a)  The Borrower shall have the right at any
time upon prior irrevocable notice to the Administrative Agent (a) not later
than 10:30 a.m., Philadelphia time, on the Business Day of conversion, to
convert any Eurodollar Loan to a Base Rate Loan, (b) not later than 10:30 a.m.,
Philadelphia time, three (3) Business Days prior to conversion or continuation
(x) to convert any Base Rate Loan into a Eurodollar Loan, or (y) to continue any
Eurodollar Loan as a Eurodollar Loan for any additional Interest Period and (c)
not later than 10:30 a.m., Philadelphia time, three (3) Business Days prior to
conversion, to convert the Interest Period with respect to any Eurodollar Loan
to another permissible Interest Period, subject in each case to the following:
 
(A) a Eurodollar Loan may not be converted at a time other than the last day of
the Interest Period applicable thereto;
 
(B) any portion of a Loan maturing or required to be repaid in less than one
month may not be converted into or continued as a Eurodollar Loan;
 
(C) no Eurodollar Loan may be continued as such and no Base Rate Loan may be
converted to a Eurodollar Loan when any Default or Event of Default has occurred
and is continuing;
 
(D) any portion of a Eurodollar Loan that cannot be converted into or continued
as a Eurodollar Loan by reason of clauses (B) or (C) above automatically shall
be converted at the end of the Interest Period in effect for such Loan to a Base
Rate Loan;
 
(E) if by the third Business Day prior to the last day of any Interest Period
for Eurodollar Loans the Borrower has failed to give notice of conversion or
continuation as described in this subsection, the Administrative Agent shall
give notice thereof to the Lenders and such Loans shall be automatically
converted to Base Rate Loans on the last day of such then expiring Interest
Period;
 
(F) all conversions and continuations of Loans hereunder and all selections of
Interest Periods hereunder shall be in such amounts and be made pursuant to such
elections that, after giving effect thereto, the aggregate principal amount of
the Loans comprising each Tranche of Eurodollar Loans shall be equal to $500,000
or in increments of $500,000 in excess thereof; and
 
(G) the Borrower shall not have outstanding at any one time more than six (6)
Tranches in the aggregate of Eurodollar Loans.
 
Each request by the Borrower to convert (but not continue) a Loan shall
constitute a representation and warranty that each of the representations and
warranties made by the Borrower herein is true and correct in all material
respects on and as of such date as if made on and as of such date (except to the
extent that such representations and warranties relate expressly to an earlier
date, in which case such request shall constitute a representation and warranty
that such representations and warranties are true and correct as of such
date).  Accrued interest on a Loan (or portion thereof) being converted shall be
paid by the Borrower at the time of conversion.
 

 
44

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

 
 
(b) In the event, and on each occasion, that on the day two (2) Business Days
prior to the commencement of any Interest Period for a Eurodollar Loan, the
Administrative Agent shall have determined (which determination absent manifest
error shall be conclusive and binding upon the Borrower) that dollar deposits in
the principal amount of such Eurodollar Loan are not generally available in the
London Interbank Market, or that the rate at which such dollar deposits are
being offered will not adequately and fairly reflect the cost to the applicable
Lenders of making or maintaining the principal amount of such Eurodollar Loan
during such Interest Period, or that reasonable means do not exist for
ascertaining the Eurodollar Rate, the Administrative Agent shall, as soon as
practicable thereafter, give written or telephonic notice of such determination
to the Borrower and the applicable Lenders, and any request by the Borrower for
a Eurodollar Loan or for conversion to or maintenance of a Eurodollar Loan
pursuant to the terms of this Agreement shall be deemed a request for a Base
Rate Loan.  After such notice shall have been given and until the circumstances
giving rise to such notice no longer exist, each request for a Eurodollar Loan
shall be deemed to be a request for a Base Rate Loan.  Each determination by the
Administrative Agent hereunder shall be conclusive absent manifest error.
 
2.9 Fees.
 
                                 (a) Commitment Fees.  The Borrower agrees to
pay to the Administrative Agent for the account of each Revolving Credit Lender,
on each January 1, April 1, July 1 and October 1, commencing January 1, 2011,
during the Revolving Credit Commitment Period and on the date on which the
Revolving Credit Commitments shall be permanently terminated or reduced as
provided herein, a revolving credit commitment fee (collectively, the
“Commitment Fees”) at a rate per annum equal to the Applicable Commitment Fee
Percentage in effect from time to time on the average daily amount of the Unused
Revolving Credit Commitments of each Revolving Credit Lender during the
preceding fiscal quarter (or shorter period commencing with the Closing Date or
ending on the Revolving Credit Termination Date; provided that, for purposes of
dividing the Commitment Fees amongst the Revolving Credit Lenders, Swing Line
Loans shall be considered to be made solely by the Swing Line Lender).  The
Commitment Fees due to each Revolving Credit Lender shall commence to accrue on
the Closing Date and shall cease to accrue on the Revolving Credit Termination
Date.  The Administrative Agent shall distribute the Commitment Fees among the
Revolving Credit Lenders pro rata in accordance with their respective Revolving
Credit Commitment Percentages.
 
(b) Administrative Agent Fee.  The Borrower shall pay to the Administrative
Agent for its own account the administrative agency fees set forth in the Fee
Letter.
 
All of the foregoing fees shall be (a) computed on the basis of the actual
number of days elapsed in a year of 360 days, including the first day but
excluding the last day occurring in the period for which such fees are payable,
and (b) paid on the dates due, in immediately available funds, to the
Administrative Agent for distribution, as appropriate, to the applicable Lenders
and/or the Administrative Agent.  Once paid, none of the foregoing fees shall be
refundable under any circumstances, except in the case of manifest error by the
Administrative Agent in the computation of any such amount, which error is
raised in writing by the Borrower to the Administrative Agent within twenty (20)
days of payment of such amount.
 

 
45

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

 

                                 2.10 Termination and Reduction of Revolving
Credit Commitments.
 
                                 (a)  The Revolving Credit Commitments shall be
automatically terminated on the Revolving Credit Termination Date whereupon the
entire outstanding principal balance of the Revolving Credit Loans and Swing
Line Loans, plus all accrued and unpaid interest thereon, and any fees or other
amounts owed under the Loan Documents in connection with the Revolving Credit
Facility (including all Commitment Fees and fees and other amounts in connection
with the Letters of Credit) shall be due and payable.
 
(b) Upon at least five (5) Business Days’ prior irrevocable written notice to
the Administrative Agent, the Borrower may at any time prior to the Revolving
Credit Termination Date, in whole permanently terminate, or from time to time in
part permanently reduce, the Revolving Credit Commitments; provided, however,
that (i) each partial reduction of such Revolving Credit Commitments shall be in
a minimum aggregate principal amount of $1,000,000 or in integral multiples of
$500,000 in excess thereof, and (ii) the Revolving Credit Commitments may not be
reduced or terminated if, after giving effect thereto and to any prepayments of
the Revolving Credit Loans made on the effective date thereof, (x) the aggregate
amount of the Revolving Credit Exposure of the Revolving Credit Lenders at such
time would exceed the aggregate Revolving Credit Commitments of the Revolving
Credit Lenders (as the same are being reduced) at such time or (y) the Revolving
Credit Exposure of any Revolving Credit Lender at such time would exceed the
Revolving Credit Commitment of such Revolving Credit Lender (as the same is
being reduced).  Each reduction in the Revolving Credits Commitments hereunder
shall be made ratably among the Revolving Credit Lenders in accordance with
their respective Revolving Credit Commitment Percentages.  The Borrower shall
pay to the Administrative Agent for the account of the Revolving Credit Lenders
on the date of each termination or reduction of the Revolving Credits
Commitments, the Commitment Fees on the amount of the Revolving Credit
Commitments so terminated or reduced accrued to the date of such termination or
reduction.
 
(c) (i)  At any time prior to one hundred eighty (180) days prior to the
Revolving Credit Termination Date, the Borrower may request an increase in the
Revolving Credit Commitments of the Revolving Credit Lenders by sending a
written notice thereof to the Administrative Agent.  Such notice shall specify
the total amount of the increase requested by the Borrower (the “Requested
Increase”); provided that (A) the amount of each Requested Increase shall be at
least $5,000,000, and in integral multiples of $1,000,000 in excess thereof
(unless otherwise agreed by the Administrative Agent in its sole discretion) and
(B) the maximum aggregate increase of the Revolving Credit Commitments shall be
$15,000,000 over the life of the Revolving Credit Facility and so the aggregate
Revolving Credit Commitments may not exceed $50,000,000.  The Revolving Credit
Commitments may be increased by either having one or more new banks or other
financial institutions (each, a “Proposed New Lender”) become a Revolving Credit
Lender and/or by having any one or more existing  Revolving Credit Lenders (at
their respective election in their sole discretion) that have been approved by
the Borrower, the Administrative Agent and the Swing Line Lender increase the
amount of their Revolving Credit Commitments, as determined by the Borrower and
the Administrative Agent.  If the Borrower requests that a Proposed New Lender
join this Agreement and provide a Revolving Credit Commitment hereunder, the
Borrower shall, at least five (5) Business Days prior to the date on which such
Proposed New Lender proposes to join this Agreement, notify the Administrative
Agent of the name of the Proposed New Lender and the amount of its proposed
Revolving Credit Commitment.  The minimum Revolving Credit Commitment of any
Proposed New Lender shall be $2,000,000, and the minimum amount of any increase
by an existing Lender shall be $500,000.  The consent of the Administrative
Agent and the Swing Line Lender shall be required for any Proposed New Lender to
join this Agreement or for any Revolving Credit Lender to increase its Revolving
Credit Commitment.  If the Administrative Agent and the Swing Line Lender so
consent to a Proposed New Lender joining this Agreement, such Proposed New
Lender shall join this Agreement pursuant to the provisions of subsection
9.6(f).
 

 
46

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

 
 
(ii) Any Revolving Credit Lender that increases its Revolving Credit Commitment
shall execute and deliver to the Administrative Agent a duly completed increased
commitment and acceptance (an “Increased Commitment and Acceptance”) prior to
the effective date of such increase.  Any Proposed New Lender shall deliver to
the Administrative Agent a duly completed new lender joinder (a “New Lender
Joinder”) at least five (5) Business Days prior to the effective date of such
Proposed New Lender’s joinder hereto (or such shorter period as shall be agreed
to by the Administrative Agent in its sole discretion).  Simultaneously with the
execution and delivery of a New Lender Joinder or an Increased Commitment and
Acceptance, the Borrower shall execute and deliver a new Revolving Credit Note
for the applicable Revolving Credit Lender.  The Increased Commitment and
Acceptance and/or New Lender Joinder shall be in form and substance acceptable
to the Administrative Agent.  Nothing herein shall obligate the Administrative
Agent or any Lender to increase the amount of its Revolving Credit Commitment
unless it elects, in its sole discretion, to do so in accordance with the
provisions of this Section 2.10(c).
 
(iii) On the effective date of any increase by a Revolving Credit Lender of its
Revolving Credit Commitment or the joinder of any Proposed New Lender (the
“Increase Date”), which date shall be a date acceptable to the Administrative
Agent, the Borrower shall repay all Revolving Credit Loans (together with any
amounts due under Section 2.15 as a result of such payment) and reborrow a like
amount of Revolving Credit Loans from the Revolving Credit Lenders, including
any Proposed New Lender joining this Agreement, according to their new Revolving
Credit Commitment Percentages.  The Administrative Agent may, to the extent the
Administrative Agent considers it practicable, net payments to and borrowings
from the same Revolving Credit Lender.
 
(iv) Following any increase in the Revolving Credit Commitments pursuant to this
Section, the Administrative Agent shall send to the Revolving Credit Lenders and
the Borrower a revised Schedule I setting forth the new Revolving Credit
Commitments of the Lenders.  Such schedule shall replace the existing Schedule I
if no Lender objects thereto (based solely on a numerical error) within 10 days
of its receipt thereof.
 
Notwithstanding anything to the contrary in this subsection, (A) the Borrower
may not request an increase in the Revolving Credit Commitments if at the time
of such request a Default or Event of Default shall have occurred and be
continuing and (B) no increase in the Revolving Credit Commitments (including by
way of the addition of a Proposed New Lender)shall become effective if on the
date that such increase would become effective, a Default or Event of Default
shall then exist or would occur as a result thereof.
 

 
47

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

 
 
2.11 Optional and Mandatory Prepayments of Loans.
 
                                 (a) The Borrower shall have the right at any
time and from time to time to prepay any Borrowing, in whole or in part, without
premium or penalty (but in any event subject to Section 2.15), upon prior
written, telecopy or telephonic notice to the Administrative Agent given no
later than 10:30 a.m., Philadelphia time, (i) in the case of Base Rate Loans, on
the same day such prepayment is to be made, and (ii) in the case of Eurodollar
Loans, three (3) Business Days before any proposed prepayment is to be made;
provided, however, that each such partial prepayment shall be in the principal
amount of at least (A) $1,000,000 or in whole multiples of $500,000 in excess
thereof in the case of Base Rate Loans and (B) $1,000,000 or in whole multiples
of $500,000 in excess thereof in the case of Eurodollar Loans.
 
(b) On the date of any termination or reduction of the Revolving Credit
Commitments pursuant to Section 2.10, the Borrower shall pay or prepay so much
of the Revolving Credit Loans and Swing Line Loans as shall be necessary in
order that (i) the aggregate Revolving Credit Exposure of the Revolving Credit
Lenders will not exceed the aggregate Revolving Credit Commitments of the
Revolving Credit Lenders after giving effect to such termination or reduction
and (ii) the Revolving Credit Exposure of any Revolving Credit Lender will not
exceed the Revolving Credit Commitment of such Revolving Credit Lender after
giving effect to such termination of reduction.
 
(c) In the event of (i) any direct or indirect sale or other disposition of any
of the assets, including lines of business, of the Borrower or any Subsidiary
(other than sales or dispositions referred to in subsections 6.5(a), (b) or (c))
(each, an “Asset Sale”) the sale price for which in the aggregate with all prior
Asset Sales made since the date of this Agreement (but only those Asset Sales
the Net Proceeds of which were not applied as a prepayment as hereinafter
provided in this subsection 2.11(c)) is greater than $1,000,000, (ii) any sale
or issuance of Capital Stock by the Parent (other than Capital Stock issued
(x) to any seller in connection with a Permitted Acquisition or (y) pursuant to
any employee equity plan of the Parent, the Borrower or their Subsidiaries),
(iii) the incurrence of additional Indebtedness for borrowed money by the
Parent, the Borrower or any of their Subsidiaries (other than Indebtedness
incurred to a seller in connection with a Permitted Acquisition or otherwise
permitted under Section 6.2 (other than Subordinated Debt under subsection (g)
thereto unless such Subordinated Debt was incurred in connection with financing
a Permitted Acquisition)), or (iv) any Material Recovery Event, the Borrower
shall promptly prepay the outstanding Loans in an amount equal to one hundred
percent (100%) of the amount of the Net Proceeds of such Asset Sale, issuance of
Capital Stock, incurrence of additional Indebtedness or Material Recovery Event;
provided that, the amount of any prepayment hereunder shall be rounded down to
the nearest multiple of $1,000; provided, further, that no such repayment shall
be required in respect of the Net Proceeds arising from (x) an Asset Sale if,
and to the extent, that the Borrower or such Subsidiary has reinvested any such
Net Proceeds arising from such Asset Sale in productive assets of a kind then
used or useable in the business of the Borrower and its Subsidiaries (including
Capital Expenditures) prior to the date that is one hundred eighty days (180)
after the date such Asset Sale is closed or (y) a Material Recovery Event if,
and to the extent that, (I) the Borrower has notified the Administrative Agent
in writing within five (5) Business Days following the receipt of the proceeds
of such Material Recovery Event of the Borrower’s or its Subsidiary’s intention
to use such Net Proceeds for the repair, replacement or restoration of the
damaged condemned property within one hundred and eighty (180) days following
the receipt of such proceeds and (II) the Borrower or such Subsidiary does in
fact reinvest such Net Proceeds arising from such Material Recovery Event for
the repair, replacement or restoration of the damaged or condemned property
prior to the date that is one hundred eighty days (180) after the receipt of
such Net Proceeds.  At the time any such Asset Sale, issuance of Capital Stock
or incurrence of additional Indebtedness is completed, or promptly after any Net
Proceeds are received by the Parent or a Subsidiary thereof in connection with a
Material Recovery Event (and, if the Borrower has given notice of its or such
Subsidiary’s, as the case may be, intention to use all or a portion of the Net
Proceeds from a Material Recovery Event as provided above, one hundred and
eighty (180) days after its receipt of such Net Proceeds), the Borrower shall
deliver to the Administrative Agent an accounting of the Net Proceeds in
sufficient detail and form acceptable to the Administrative Agent together with
the amount of any prepayment or repayment required at such time.  Payments made
pursuant to this subsection 2.11(c) shall be applied in accordance with
subsection 2.11(f) below.
 

 
48

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

 
 
(d) Commencing with the fiscal year ending December 31, 2011, the Borrower
shall, within two (2) Business Days after the delivery of the Parent’s financial
statements for such fiscal year required pursuant to Section 5.1(a), prepay the
outstanding Loans in an amount equal to fifty percent (50%) of the amount of the
Excess Cash Flow for such fiscal year less the aggregate principal amount of any
voluntary prepayments of the Term Loans made by the Borrower during such fiscal
year.  Payments pursuant to this subsection 2.11(d) shall be applied in
accordance with subsection 2.11(f) below.
 
(e) Each notice of prepayment pursuant to subsections (a) and (b) of this
Section 2.11 shall specify (i) the prepayment date, (ii) the principal amount of
each Borrowing to be prepaid and (iii) in the case of prepayments pursuant to
subsection (a), to which Facility the prepayment is to be applied.  Each notice
of prepayment shall be irrevocable and shall commit the Borrower to prepay such
Borrowing (or portion thereof) by the amount stated therein.  Each prepayment
under the Term Loan Facility pursuant to subsections (a) and (b) of this Section
2.11 shall be applied to the Term Loans in the inverse order of maturity.  All
prepayments under this Section 2.11 of Revolving Credit Loans that are
Eurodollar Loans and all prepayments of Term Loans shall be accompanied by
accrued interest on the principal amount being prepaid to the date of prepayment
and any amounts owed under Section 2.15.
 
(f) Payments pursuant to clauses (c) and (d) of this Section 2.11 shall be
applied first to the Term Loans in the inverse order of maturity until paid in
full second to the Swing Line Loans until paid in full and third to the
Revolving Credit Loans until paid in full; provided that, if an Event of Default
shall have occurred and be continuing, any such payments shall be applied pro
rata to the Loans and the Letter of Credit Obligations (based on the principal
amount of the Loans outstanding and the aggregate amount of the Letter of Credit
Obligations then outstanding), with any amounts attributable to the Letter of
Credit Obligations to be held by the Administrative Agent in a cash collateral
account pursuant to Section 7.2 or, at the Administrative Agent’s discretion and
with the consent of the Issuing Bank, applied to (i) the Revolving Credit Loans
then outstanding and (ii) if the Revolving Credit Loans have been paid in full,
to the Term Loans then outstanding.  Payments of the Swing Line Loans or the
Revolving Credit Loans and/or in respect of the Letter of Credit Obligations
shall not reduce the Swing Line Sublimit or the Revolving Credit
Commitments.  To the extent any prepayments are required pursuant to clauses (c)
or (d) of this Section 2.11 after the Loans have been paid in full, then, no
such payments shall be required unless an Event of Default shall have occurred
and be continuing, in which case the Borrower shall deliver to the
Administrative Agent, to be held in a cash collateral account pursuant to
Section 7.2, an amount equal to the difference between (i) the Letter of Credit
Coverage Requirement and (ii) the amount of cash, if any, then held by the
Administrative Agent in a collateral account pursuant to Section 7.2, with any
remaining Net Proceeds to be applied first to any other outstanding Obligations
and next to be retained by the Parent, the Borrower or its Subsidiary, as
applicable.  So long as no Event of Default shall have occurred and be
continuing, unless otherwise requested by the Borrower, each payment, to the
extent consistent with its application to the appropriate Facility, shall be
applied first to Base Rate Loans and next to Eurodollar Loans in the direct
order of maturity of Interest Periods.
 

 
49

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

 
 
2.12 Illegality.
 
Notwithstanding any other provision herein, if any change in any Requirement of
Law or in the interpretation or application thereof shall make it unlawful for
any Lender to make or maintain Eurodollar Loans as contemplated by this
Agreement, (a) the commitment of such Lender hereunder to make Eurodollar Loans,
continue Eurodollar Loans as such and convert or refinance Base Rate Loans to
Eurodollar Loans shall forthwith be cancelled and (b) such Lender’s Loans then
outstanding as Eurodollar Loans, if any, shall be converted automatically to
Base Rate Loans on the respective last days of the then current Interest Periods
with respect to such Loans or within such earlier period as required by law.  If
any such conversion of a Eurodollar Loan occurs on a day which is not the last
day of the then current Interest Period with respect thereto, the Borrower shall
pay to such Lender such amounts, if any, as may be required pursuant to Section
2.15.
 
2.13 Requirements of Law.
 
                                 (a)  In the event that any change in any
Requirement of Law or in the interpretation, or application thereof or
compliance by any Lender with any request or directive (whether or not having
the force of law) from any central bank or other Governmental Authority made
subsequent to the date hereof:
 
(i) shall subject any Lender to any tax of any kind whatsoever with respect to
this Agreement, any Note or any Eurodollar Loan made by it, or change the basis
of taxation of payments to such Lender in respect thereof (except for taxes
covered by Section 2.14 and changes in the rate of tax on the overall net
income, gross receipts or revenue of such Lender);
 
(ii) shall impose, modify or hold applicable any reserve, special deposit or
similar requirement against assets held by, deposits or other liabilities in or
for the account of, advances, loans or other extensions of credit by, or any
other acquisition of funds by, any office of such Lender which is not otherwise
included in the determination of the interest rate on such Eurodollar Loan
hereunder; or
 
(iii) shall impose on such Lender any other condition; and the result of any of
the foregoing is to increase the cost to such Lender, by an amount which such
Lender deems to be material, of making, converting into, continuing or
maintaining
 
Eurodollar Loans or to reduce any amount receivable hereunder in respect thereof
then, in any such case, the Borrower shall as promptly as practicable pay such
Lender, upon its demand, any additional amounts necessary to compensate such
Lender for such increased cost or reduced amount receivable.  If any Lender
becomes entitled to claim any additional amounts pursuant to this subsection, it
shall as promptly as practicable notify the Borrower, through the Administrative
Agent, of the event by reason of which it has become so entitled.  A certificate
as to any additional amounts payable pursuant to this subsection submitted by
such Lender, through the Administrative Agent, to the Borrower shall be
conclusive in the absence of manifest error.  This covenant shall survive the
termination of this Agreement and the payment of the Notes and all other amounts
payable hereunder.  If any amount is refunded to such Lender, such Lender will
reimburse the Borrower for amounts paid in respect of the refunded amount
without interest (except to the extent of any interest actually received by such
Lender from the relevant Governmental Authority with respect to such refund).
 
(b) In the event that any Lender shall have determined that any change in any
Requirement of Law regarding capital adequacy or in the interpretation or
application thereof or compliance by such Lender or any corporation controlling
such Lender with any request or directive regarding capital adequacy (whether or
not having the force of law) from any Governmental Authority made subsequent to
the date hereof does or shall have the effect of reducing the rate of return on
such Lender’s or such corporation’s capital as a consequence of its obligations
hereunder to a level below that which such Lender or such corporation could have
achieved but for such change or compliance (taking into consideration such
Lender’s or such corporation’s policies with respect to capital adequacy) by an
amount deemed by such Lender to be material, then from time to time, after
submission as promptly as practicable by such Lender to the Borrower (with a
copy to the Administrative Agent) of a written request therefor, the Borrower
shall pay to such Lender such additional amount or amounts as will compensate
such Lender for such reduction.
 
(c) Each Lender agrees that it will use reasonable efforts in order to avoid or
to minimize, as the case may be, the payment by the Borrower of any additional
amount under subsections 2.13(a) and (b); provided, however, that no Lender
shall be obligated to incur any expense, cost or other amount in connection with
utilizing such reasonable efforts; provided, further, that the Borrower shall
not be under any obligation to compensate any Lender under this Section 2.13
with respect to increased costs or reductions with respect to any period prior
to the date that is one hundred eighty (180) days prior to such request if such
Lender knew or could reasonably have been expected to know of the circumstances
giving rise to such increased costs or reductions and of the fact that such
circumstances would result in a claim for increased compensation by reason of
such increased costs or reductions; provided, further, that the foregoing
limitation shall not apply to any increased costs or reductions arising out of
the retroactive application of any change in any Law within such one hundred
eighty (180) day period.
 
 

 
50

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

 
2.14 Taxes.
 
                                 (a) All payments made by the Borrower under
this Agreement and the Notes shall be made free and clear of, and without
deduction or withholding for or on account of, any present or future income,
stamp or other taxes, levies, imposts, duties, charges, fees, deductions or
withholdings, now or hereafter imposed, levied, collected, withheld or assessed
by any Governmental Authority, other than Excluded Taxes (all such non-excluded
taxes, levies, imposts, duties, charges, fees, deductions and withholdings being
hereinafter called “Taxes”).  If any Taxes are required to be withheld from any
amounts payable to the Administrative Agent or any Lender hereunder or under the
Notes, the amounts so payable to the Administrative Agent or such Lender shall
be increased to the extent necessary to yield to the Administrative Agent or
such Lender (after payment of all Taxes) interest or any such other amounts
payable hereunder at the rates or in the amounts specified in this Agreement and
the Notes.  Whenever any Taxes are payable by the Borrower, as promptly as
possible thereafter the Borrower shall send to the Administrative Agent for its
own account or for the account of such Lender, as the case may be, a certified
copy of an original official receipt received by the Borrower showing payment
thereof.  If the Borrower fails to pay any Taxes when due to the appropriate
taxing authority or fails to remit to the Administrative Agent the required
receipts or other required documentary evidence, the Borrower shall indemnify
the Administrative Agent and the Lenders for any incremental taxes, interest or
penalties that may become payable by the Administrative Agent or any Lender as a
result of any such failure.  The agreements in this subsection shall survive the
termination of this Agreement and the payment of the Notes and all other amounts
payable hereunder.
 
(b) Any Foreign Lender that is entitled to an exemption from or reduction of
withholding tax under the law of the jurisdiction in which the Borrower is
located, or any treaty to which such jurisdiction is a party, with respect to
payments under this Agreement shall deliver to the Borrower (with a copy to the
Administrative Agent), at the time or times prescribed by applicable law, such
properly completed and executed documentation prescribed by applicable law or
reasonably requested by the Borrower as will permit such payments to be made
without withholding or at a reduced rate.  Each such Foreign Lender shall also
deliver to the Borrower (with a copy to the Administrative Agent) such further
documentation on or before the date that any documentation previously delivered
to the Borrower hereunder shall expire or become obsolete and after the
occurrence of any event requiring a change in such previously delivered
documentation.
 
(c) The Borrower shall not be required to pay any additional amounts to the
Administrative Agent or any Lender in respect of payments of United States
withholding tax or other Taxes made by the Borrower which are consistent with
the forms and information delivered to the Borrower and the Administrative Agent
or if the payment of such amounts would not have arisen but for a failure by the
Administrative Agent or such Lender to comply with the requirements of
subsection 2.14(b) or the Administrative Agent or such Lender did not timely
deliver to the Borrower the forms listed or described in subsection 2.14(b) or
did not take such other steps as reasonably may be available to it under
applicable tax laws and any applicable tax treaty or convention to obtain an
exemption from, or reduction (to the lowest applicable rate) of, such United
States withholding tax and other Taxes or, if such steps were taken, the
information was not timely and duly delivered to the Borrower.
 
2.15 Indemnity.
 
                                 (a)  The Borrower agrees to indemnify each
Lender and to hold each Lender harmless from any loss or expense which such
Lender may sustain or incur as a consequence of (i) default by the Borrower in
payment when due of the principal amount of or interest on any Eurodollar Loan
or Swing Line Loan, (ii) default by the Borrower in making a borrowing of,
conversion into or continuation of Eurodollar Loans or Swing Line Loans after
the Borrower has given a notice requesting the same in accordance with the
provisions of this Agreement, (iii) default by the Borrower in making any
prepayment after the Borrower has given a notice thereof in accordance with the
provisions of this Agreement, (iv) the making of a prepayment of Eurodollar
Loans or Swing Line Loans on a day which is not the last day of an Interest
Period with respect thereto (or, in the case of a Swing Line Loan, on the date
such Swing Line Loan is due), or (v) the assignment of any Eurodollar Loan other
than on the last day of the Interest Period or maturity date applicable thereto
as a result of a request by the Borrower pursuant to Section 2.19, including,
without limitation, in each case, any such loss or expense arising from the
reemployment of funds obtained by it or from fees payable to terminate the
deposits from which such funds were obtained.  A certificate as to any amounts
(including a calculation thereof) that a Lender is entitled to receive under
this Section 2.15 submitted by such Lender, through the Administrative Agent, to
the Borrower shall be conclusive in the absence of manifest error and all such
amounts shall be paid by the Borrower promptly upon demand by such Lender.  This
covenant shall survive the termination of this Agreement and the payment of the
Notes and all other amounts payable hereunder.
 

 
51

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

 
 
 
(b) For the purpose of calculation of all amounts payable to a Lender under this
Section, each Lender shall be deemed to have actually funded its relevant
Eurodollar Loan or Swing Line Loan through the purchase of a deposit bearing
interest at the Eurodollar Rate or the applicable rate on such Swing Line Loan,
as the case may be, in an amount equal to the amount of that Eurodollar Loan or
Swing Line Loan and having a maturity comparable to the relevant Interest Period
or applicable period for such Eurodollar Loan or Swing Line Loan; provided,
however, that each Lender may fund each of its Eurodollar Loans and the
Swing  Line Lender may fund its Swing Line Loans in any manner it sees fit, and
the foregoing assumptions shall be utilized only for the calculation of amounts
payable under this subsection.  This covenant shall survive the termination of
this Agreement and the payment of the Loans and all other amounts payable
hereunder.
 
2.16 Treatment of Loans and Payments.
 
Except as provided under Sections 2.4, 2.12, 2.14 or subsection 9.6(h), each
Borrowing by the Borrower hereunder, each payment or prepayment of principal of
the Loans, each payment of interest on the Loans, each payment of Commitment
Fees and participation in Letters of Credit shall be made pro rata among the
relevant Lenders in accordance with their respective Revolving Credit Commitment
Percentage, Term Loan Percentage or Total Percentage, as the case may be.  Each
Lender agrees that in computing such Lender’s portion of any borrowing to be
made hereunder, the Administrative Agent may, in its discretion, round each
Lender’s amount of such borrowing to the next higher or lower whole dollar
amount.
 
2.17 Payments.
 
                                 (a)  The Borrower shall make each payment
(including principal of or interest on any Borrowing or any fees or other
amounts) hereunder not later than 12:00 (noon), Philadelphia time, on the date
when due to the Administrative Agent at its offices set forth in Section 9.2, in
immediately available funds.  Such payments shall be made without setoff or
counterclaim of any kind.  The Administrative Agent shall distribute to the
Lenders any payments received by the Administrative Agent for their account
promptly upon receipt in like funds as received, provided that, any payment
received by the Administrative Agent for the account of the Lenders at or before
2:00 p.m. Pennsylvania time will be distributed to the Lenders on the same
Business Day and any such payment received after that time on a given day may be
distributed on the next Business Day.
 

 
52

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

 

(b) Whenever any payment hereunder or under the Notes shall be stated to be due
on a day other than a Business Day, such payment shall be made on the next
succeeding Business Day, and such extension of time shall in such case be
included in the computation of the payment of interest or fees, as the case may
be, provided that if such extension would cause payment of any interest on or
principal of the Loans or payment of any commitment fees to be made in the next
following calendar month, such payment shall be made on the immediately
preceding Business Day.
 
(c) In the event that any payment of principal, interest or commitment fees due
the Lenders or the Administrative Agent under any of the Loan Documents is not
paid when due, the Administrative Agent is hereby authorized to effect such
payment upon prior notice to the Borrower by debiting any demand deposit account
of the Borrower now or in the future maintained with the Administrative
Agent.  This right of debiting accounts of the Borrower is in addition to any
right of setoff accorded the Lenders hereunder or by operation of law.
 
2.18 Loan Accounts.
 
Each Lender shall open and maintain on its books a loan account in the
Borrower’s name with respect to Loans made, repayments, prepayments, the
computation and payment of interest and other amounts due and sums paid to such
Lender hereunder and under the Loan Documents.  Except in the case of manifest
error in computation, such records shall be presumed correct as to the amount at
any time due to such Lender from the Borrower.  The failure of any Lender to
make an entry in its loan account shall not abrogate the Borrower’s duty to
repay the Indebtedness and other amounts owed to such Lender under the Loan
Documents.
 
2.19 Assignment of Loans and/or Revolving Credit Commitments Under Certain
Circumstances; Duty to Mitigate.
 
In the event (a) any Lender delivers a notice pursuant to Section 2.12 that it
has become unlawful for such Lender to make or maintain Eurodollar Loans, (b)
any Lender delivers a certificate requesting compensation pursuant to Section
2.13, (c) the Borrower is required to pay any additional amount to any Lender or
any Governmental Authority on account of any Lender pursuant to Section 2.14 or
(d) any Lender is a Defaulting Lender, the Borrower may, at its sole expense and
effort (including with respect to the processing and recordation fee referred to
in subsection 9.6(b)), upon notice to such Lender and the Administrative Agent,
require such Lender to transfer and assign, without recourse (in accordance with
and subject to the restrictions contained in Section 9.6), all of its interests,
rights and obligations under this Agreement to a Purchasing Lender that shall
assume such assigned obligations (which Purchasing Lender may be another Lender,
if a Lender accepts such assignment); provided that (i) such assignment shall
not conflict with any law, rule or regulation or order of any court or other
Governmental Authority having jurisdiction, (ii) the Borrower shall have
received the prior written consent of the Administrative Agent (and, if a
Revolving Credit Commitment or Revolving Credit Loans are being assigned, the
consent of the Issuing Bank), which consent(s) shall not be unreasonably delayed
or withheld, (iii) the Borrower or such Purchasing Lender shall have paid to the
affected Lender in immediately available funds an amount equal to the sum of the
principal of and interest accrued to the date of such payment on the outstanding
Loans, plus all fees (including, without limitation, Commitment Fees) and other
amounts accrued hereunder for the account of such Lender (including, without
limitation, amounts owing under Sections 2.13, 2.14 and 2.15) and (iv) to the
extent such affected Lender is also the Issuing Bank, (A) the Borrower or such
Purchasing Lender  shall have paid to the Issuing Bank all L/C Disbursements,
plus all fees (including, without limitation, Letter of Credit Fees) and other
amounts accrued hereunder for the account of the Issuing Bank and (B) the
Borrower shall have either (I) returned to the Issuing Bank the original of any
outstanding Letters of Credit or (II) delivered to the Issuing Bank cash
collateral for any such outstanding Letters of Credit in an amount equal to the
Letter of Credit Coverage Requirement for each such Letter of Credit the
original of which is not returned to the Issuing Bank.  Each Lender hereby
grants to the Administrative Agent an irrevocable power of attorney (which power
is coupled with an interest) to execute and deliver, on behalf of such Lender as
assignor, any Assignment and Assumption necessary to effectuate any assignment
of such Lender’s interests hereunder in the circumstances contemplated by this
Section 2.19.
 

 
53

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

 
                                 2.20 Use of Proceeds.
 
The proceeds of the Loans may be used by the Borrower and its Subsidiaries for
its working capital, capital expenditures and general corporate purposes in the
ordinary course of business (including paying off the Indebtedness under the
Existing Credit Agreement and paying the fees and expenses associated with the
Loan Documents) and to finance all or a portion of the purchase price and
transaction costs in connection with Permitted Acquisitions.  The Letters of
Credit shall be letters of credit required in the ordinary course of the
business of the Borrower and its Subsidiaries or in connection with Permitted
Acquisitions.
 
2.21 Defaulting Lenders.
 
Notwithstanding any provision of this Agreement to the contrary, if any Lender
becomes a Defaulting Lender, then the following provisions shall apply for so
long as such Lender is a Defaulting Lender:
 
(a) such Defaulting Lender, to the extent that it is a Revolving Credit Lender,
shall no longer be entitled to receive its Revolving Credit Commitment
Percentage of Letter of Credit Fees or Commitment Fees otherwise payable
pursuant to Sections 2.4 or 2.9 hereof, and thereafter, so long as any Revolving
Credit Lender is a Defaulting Lender, the fees payable to the Non-Defaulting
Revolving Credit Lenders pursuant to Section 2.9 shall be based on their
Adjusted Revolving Credit Commitment Percentages;
 
(b) such Defaulting Lender, or the Term Loans, Revolving Credit Exposure,
Revolving Credit Commitment Percentage of such Defaulting Lender, as applicable,
shall not be included in determining whether all Lenders or Required Lenders
have taken or may take any action hereunder (including any consent to any
amendment or waiver pursuant to Section 9.1), provided that any waiver,
amendment or modification requiring the consent of all Lenders or each affected
Lender which affects such Defaulting Lender differently than other affected
Lenders shall require the consent of such Defaulting Lender;
 
(c) if any outstanding Swing Line Loans or Letters of Credit exist at the time a
Lender becomes a Defaulting Lender then:
 
(i) such Defaulting Lender’s pro rata portion of such Swing Line Loans shall be
reallocated among the Non-Defaulting Revolving Credit Lenders in accordance with
their respective Adjusted Revolving Credit Commitment Percentages but only to
the extent (x) the sum of (A) the Revolving Credit Loans of all Non-Defaulting
Revolving Credit Lenders plus (B) all Non-Defaulting Revolving Credit Lenders’
Adjusted Revolving Credit Commitment Percentages of the aggregate principal
amount of all outstanding Swing Line Loans plus Letter of Credit Obligations
then outstanding does not exceed the aggregate amount of the Revolving Credit
Commitments of all Non-Defaulting Revolving Credit Lenders and (y) the
conditions set forth in Section 4.2 are satisfied at such time;
 

 
54

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

 
                                                 (ii) such Defaulting Lender’s
participation interests in such outstanding Letters of Credit shall be
reallocated among the Non-Defaulting Revolving Credit Lenders in accordance with
their respective Adjusted Revolving Credit Commitment Percentages but only to
the extent (x) the sum of (A) the Revolving Credit Loans of all Non-Defaulting
Revolving Credit Lenders plus (B) all Non-Defaulting Revolving Credit Lenders’
Adjusted Revolving Credit Commitment Percentages of the aggregate principal
amount of all outstanding Swing Line Loans plus Letter of Credit Obligations
then outstanding does not exceed the aggregate amount of the Revolving Credit
Commitments of all Non-Defaulting Revolving Credit Lenders and (y) the
conditions set forth in Section 4.2 are satisfied at such time;
 
(iii) to the extent that all or any part of such Defaulting Lender’s pro rata
portion of Swing Line Loans cannot be reallocated pursuant to Section
2.21(c)(i), then the Borrower (A) shall, within 15 days following notice from
the Administrative Agent until such Defaulting Lender ceases to be a Defaulting
Lender under this Agreement, establish and, thereafter, maintain a special
collateral account (the “Swing Line Collateral Account”) at the Administrative
Agent’s office at the address specified pursuant to Section 9.2, in the name of
the Borrower but under the sole dominion and control of the Administrative
Agent, (B) grant to the Administrative Agent for the benefit of the Revolving
Credit Lenders, solely as security for repayment of the unallocated portion of
such Defaulting Lender’s Revolving Credit Commitment Percentage of outstanding
Swing Line Loans, a security interest in and to the Swing Line Collateral
Account and any funds that may thereafter be deposited therein and (C) shall
maintain in the Swing Line Collateral Account an amount equal to the unallocated
portion of such Defaulting Lender’s Revolving Credit Commitment Percentage of
outstanding Swing Line Loans; and
 
(iv) to the extent that all or any part of such Defaulting Lender’s
participations in outstanding Letters of Credit cannot be reallocated pursuant
to Section 2.24(c)(ii), then the Borrower (A) shall, within 15 days following
notice from the Administrative Agent until such Defaulting Lender ceases to be a
Defaulting Lender under this Agreement, establish and, thereafter, maintain a
special collateral account (the “Letter of Credit Collateral Account”) at the
Administrative Agent’s office at the address specified pursuant to Section 9.2
in the name of the Borrower but under the sole dominion and control of the
Administrative Agent, (B) grant to the Administrative Agent for the benefit of
the Revolving Credit Lenders, as security for the unallocated portion of such
Defaulting Lender’s Revolving Credit Commitment Percentage of all Letter of
Credit Obligations, a security interest in the Letter of Credit Collateral
Account and any funds that may be deposited therein and (C) shall maintain in
the Letter of Credit Collateral Account an amount equal to the unallocated
portion of such Defaulting Lender’s Revolving Credit Commitment Percentage of
all Letter of Credit Obligations, regardless of whether any Letters of Credit
have then been drawn.
 
(d) the Swing Line Lender shall not be required to, but in its sole discretion
may from time to time elect to, fund any Swing Line Loan and the Issuing Bank
shall not be required to, but in its sole discretion may from time to time elect
to, issue, amend or increase any Letter of Credit, unless it is satisfied in its
sole discretion that the related exposure will be 100% covered by the
Non-Defaulting Revolving Credit Lenders and/or cash collateral will be provided
by the Borrower in accordance with Section 2.21(c).
 

 
55

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

 
 
(e)  any amount payable to a Defaulting Lender hereunder (whether on account of
principal, interest, fees or otherwise) shall, in lieu of being distributed to
such Defaulting Lender, be retained by the Administrative Agent in a segregated
account and, subject to any applicable requirements of law, be applied at such
time or times as may be determined by the Administrative Agent (i) first, to the
payment of any amounts owing by such Defaulting Lender to the Administrative
Agent hereunder, (ii) second, pro rata, to the payment of any amounts owing by
such Defaulting Lender to the Issuing Bank and the Swing Line Lender hereunder,
(iii) third, to the funding of any Revolving Credit Loan or the funding of any
participating interest in any Swing Line Loan or Letter of Credit or in respect
of which such Defaulting Lender has failed to fund its portion thereof as
required by this Agreement, as determined by the Administrative Agent,
(iv) fourth, if so determined by the Administrative Agent and the Borrower, held
in such account as cash collateral for future funding obligations of the
Defaulting Lender under this Agreement (but only if such Defaulting Lender is a
Revolving Credit Lender), (v) fifth, pro rata, to the payment of any amounts
owing to the Borrower or the Lenders as a result of any judgment of a court of
competent jurisdiction obtained by the Borrower or any Lender against such
Defaulting Lender as a result of such Defaulting Lender’s breach of its
obligations under this Agreement; provided that, if an Event of Default shall
have occurred and be continuing, any payments that would be made to the Borrower
shall be applied by the Administrative Agent to the Obligations in such order as
the Administrative Agent shall elect and (vi) sixth, to such Defaulting Lender
or as otherwise directed by a court of competent jurisdiction; provided that if
such payment is (x) a payment of the principal amount of any Revolving Credit
Loans or reimbursement obligations in respect of Letters of Credit for which a
Defaulting Lender has not fully funded its participation obligations and
(y) made at a time when the conditions set forth in Section 4.2 are satisfied,
the remaining portion of such payment shall be applied solely to prepay the
Revolving Credit Loans of, and reimbursement obligations owed to, all
Non-Defaulting Revolving Credit Lenders pro rata prior to being applied to the
prepayment of any Revolving Credit Loans of, or reimbursement obligations owed
to, any Defaulting Lender.
 
(f) In the event that the Borrower, the Administrative Agent, the Issuing Bank
and the Swing Line Lender each agrees that a Defaulting Lender that is a
Revolving Credit Lender has adequately remedied all matters that caused such
Revolving Credit Lender to be a Defaulting Lender, then the Swing Line Loans and
the Letter of Credit participations of the Revolving Credit Lenders shall be
readjusted to reflect the inclusion of such Lender’s Revolving Credit Commitment
Percentage and on such date such Lender shall purchase at par such of the
Revolving Credit Loans of the other Revolving Credit Lenders (other than Swing
Line Loans) as the Administrative Agent shall determine may be necessary in
order for such Revolving Credit Lender to hold such Revolving Credit Loans in
accordance with its Revolving Credit Commitment Percentage, subject to the
provisions of Section 2.15.
 

 
56

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

 

SECTION 3.  REPRESENTATIONS AND WARRANTIES
 
To induce the Administrative Agent, the Lenders and the Issuing Bank to enter
into this Agreement and to make the Loans and to issue and/or participate in
Letters of Credit, the Borrower hereby represents and warrants to the
Administrative Agent and each Lender that:
 
3.1 Corporate Existence.
 
Each of the Borrower and the other Loan Parties is duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization, and is duly qualified or licensed to do business and is in good
standing in all other jurisdictions in which the character of the properties
owned or the nature of the activities conducted by it makes such qualification
or licensing necessary, except where the failure to be so qualified would not
reasonably be expected to have a Material Adverse Effect.
 
3.2 Subsidiaries
 
The Subsidiaries of the Parent and the record ownership of each such Subsidiary
on the date hereof are listed on Schedule 3.2 attached hereto.
 
3.3 Authority and Binding Effect.
 
Each of the Borrower and the other Loan Parties has all requisite power and
authority, corporate and otherwise, to own, lease, encumber and operate its
properties and assets and to carry on its business as now being conducted.  Each
of the Borrower and the other Loan Parties has all requisite power and
authority, corporate or otherwise, to enter into and to perform its obligations
under this Agreement, the Notes and the other Loan Documents to which it is a
party and to fulfill its obligations set forth herein and therein.  The
execution, delivery and performance of this Agreement, the borrowings hereunder
and the execution and delivery of the Notes, the Applications and the other Loan
Documents to which the Borrower or any other Loan Party is a party have been
duly authorized by all requisite corporate action and will not violate or
constitute a default under any Requirement of Law, or of any indenture, note,
loan or credit agreement, license or any other agreement, lease or instrument to
which the Parent or any of its Subsidiaries is a party or by which the Parent or
any of its Subsidiaries or any of its or their Properties are bound.  This
Agreement and the other Loan Documents have each been duly executed and
delivered by each Loan Party party thereto.  This Agreement constitutes, and the
Notes and other Loan Documents issued or to be issued hereunder, when executed
and delivered pursuant hereto, will constitute, the authorized, valid and
legally binding obligations of the Borrower or other Loan Party party thereto
enforceable in accordance with their respective terms, except as limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other laws or
equitable principles from time to time in effect relating to or affecting the
rights of creditors generally.
 
3.4 Approvals.
 
No consent or approval of any trustee or holder of any indebtedness, nor any
authorization, consent, approval, license, exemption of or registration,
declaration or filing with any court or governmental department, commission,
board, bureau, agency or instrumentality, domestic or foreign, is or will be
necessary to the valid execution and delivery of this Agreement, the Notes or
the other Loan Documents or the consummation by the Borrower or the other Loan
Parties of the transactions contemplated by this Agreement, except such as have
been obtained.
 

 
57

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

 

3.5 Recording and Enforceability.
 
No recording, filing, registration, notice or other similar action is required
in order to insure the legality, validity, binding effect or enforceability of
this Agreement, the Notes or the other Loan Documents as against the Borrower
and any other Loan Party.
 
3.6 Litigation.
 
Schedule 3.6 attached hereto contains a list as of the date hereof of all
litigation, claims, disputes, assessments, judgments, judicial and
administrative orders outstanding against the Parent or any of its Subsidiaries
and any actions, suits or proceedings at law or in equity or by or before any
governmental or administrative instrumentality or other agency pending or, to
the knowledge of the Borrower, threatened against the Parent or any of its
Subsidiaries or affecting its or their property or rights which in any such case
if decided adversely individually or in the aggregate would reasonably be
expected to have a Material Adverse Effect.  Neither the Parent nor any
Subsidiary is in default under any applicable statute, rule, order, certificate
or regulation of any Governmental Authority having jurisdiction over the Parent
or any Subsidiary thereof which default would reasonably be expected to have a
Material Adverse Effect.  No litigation, investigation or proceeding of or
before any arbitrator or Governmental Authority is pending or, to the knowledge
of the Borrower, threatened against the Borrower, any other Loan Party or any of
its or their respective Subsidiaries or against any of its or their respective
business, operations, properties or condition (financial or otherwise) (a) with
respect to this Agreement, the Notes, the other Loan Documents or any of the
transactions contemplated hereby, or (b) as to which there is a reasonable
likelihood of an adverse determination and which, if adversely determined, would
reasonably be expected to have a Material Adverse Effect.
 
3.7 Financial Information.
 
The Borrower has delivered to the Administrative Agent true, correct and
complete copies of the Parent’s audited balance sheet as of December 31, 2009
and statements of profit and loss and surplus for the year then ended which have
been certified by Grant Thornton LLP and the Parent’s unaudited internally
prepared balance sheet as of June 30, 2010 and statements of profit and loss and
surplus for the quarter then ended.  All such financial statements have been
prepared in accordance with GAAP, except for the absence of footnotes and
subject to year-end adjustments in the unaudited financial statements, and are
true and complete and present fairly in accordance with GAAP, the financial
condition and results of operations of the Parent and its Subsidiaries as of
such dates and for the periods covered thereby, and said balance sheets
accurately reflect all liabilities, including contingent liabilities that are
required by GAAP to be reflected thereon as of the dates thereof.  Since
December 31, 2009, there has been no development or event which individually or
in the aggregate would reasonably be expected to have a Material Adverse Effect.
 
3.8 Taxes.
 
Each of the Parent and its Subsidiaries has filed all federal, state and local
tax returns which it is required by law to file, subject to the timely filing of
any extension therefor, and has paid all material taxes, assessments and other
governmental charges due in respect of such returns, except to the extent that
any such taxes, assessments or other governmental charges are being contested in
good faith and as to which the Parent or such Subsidiary has set aside on its
books adequate reserves.  No federal tax Lien has been filed against the Parent
or any of its Subsidiaries.
 

 
58

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

 

3.9 Intellectual Property.
 
Each of the Borrower and the other Loan Parties owns, or is licensed to use, all
trademarks, tradenames, copyrights, technology, know-how and processes necessary
for the conduct of its business as currently conducted (the “Intellectual
Property”) except for those as to which the failure to own or license would not
reasonably be expected to have a Material Adverse Effect.  As of the date
hereof, except as set forth on Schedule 3.9 no claim has been asserted against
the Parent or any Subsidiary and is pending by any Person challenging or
questioning the use of any such Intellectual Property, nor to the Borrower’s
knowledge, is any such claim threatened and, with respect to any time
thereafter, no such claim has been asserted which would reasonably be expected
to have a Material Adverse Effect.  To the Borrower’s knowledge, the use of such
Intellectual Property by the Borrower and the other Loan Parties does not
infringe the rights of any Person, except for such claims and infringements
that, in the aggregate, would not reasonably be expected to have such a Material
Adverse Effect.
 
3.10 Intentionally Omitted.
 
 
3.11 Material Agreements.
 
 As of the date hereof, Schedule 3.11 attached hereto contains a list of all of
the Parent’s and its Subsidiaries’ material leases, contracts, agreements,
understandings and commitments of any kind the breach of which would directly or
indirectly reasonably be expected to have a Material Adverse Effect and all
parties (including the Parent and its Subsidiaries) to all such material leases,
contracts, agreements, understandings and commitments have to the Borrower’s
knowledge complied with the provisions thereof in all material respects and
neither the Parent nor any of its Subsidiaries is in material default under any
provision thereof and to the knowledge of the Borrower (i) no other party
thereto is in default under any material provision thereof and (ii) no event has
occurred which, but for the giving of notice or the passage of time, or both,
would constitute a material default thereunder.
 
3.12 Compliance With Law.
 
Each of the Parent and its Subsidiaries is in compliance with all Requirements
of Law except to the extent that the failure to comply therewith would not in
the aggregate reasonably be expected to have a Material Adverse Effect.  As of
the date hereof, no Loan Party has received any written notice, not heretofore
complied with, from any federal, state or local authority or any insurance or
inspection body to the effect that any of its properties, facilities, equipment
or business procedures or practices fail to materially comply with any
applicable law, ordinance, regulation, building or zoning law, or any other
requirements of any such authority or body, except where such failure would not
reasonably be expected to have a Material Adverse Effect.
 
3.13 Title to Property.
 
Each of the Parent and its Subsidiaries has good title to or valid leasehold
interests in or license to use or similar interests in all personal properties,
assets and other rights which it purports to own or lease or which is reflected
as owned or leased on its respective books and records (except where failure to
have good title to, or valid leasehold or similar interests in, would not
reasonably be expected to have a Material Adverse Effect), free and clear of all
Liens except Permitted Liens, and subject to the terms and conditions of the
applicable leases.  Except for financing statements evidencing Permitted Liens
or protective filings related to operating leases or other assets in the
possession of, but not owned by, the Parent or any of its Subsidiaries, no
effective financing statement under the Uniform Commercial Code is in effect in
any jurisdiction and no other filing which names the Parent or any of its
 

 
59

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

 

Subsidiaries as debtor or which covers or purports to cover any of the assets of
the Parent or any of its Subsidiaries is currently effective and on file in any
state or other jurisdiction.  All of the assets and properties of the Parent and
its Subsidiaries that are necessary for the operation of their respective
businesses are in good working condition and are able to serve the functions for
which they are currently being used, except for ordinary wear and tear.
 
3.14 Security Interests.
 
At all times after execution and delivery of the Security Documents by the Loan
Party or Loan Parties party thereto and completion of the filings and recordings
(to the extent not already filed and recorded prior to the Closing Date) in the
jurisdictions listed on Schedule 3.14, and delivery to the Administrative Agent
of possession or control, as applicable, of all Collateral the perfection of a
security interest in which requires possession or control under the Uniform
Commercial Code, the security interests created for the benefit of the
Administrative Agent and the Lenders pursuant to the Security Documents will
constitute valid, perfected security interests in the Collateral subject
thereto, subject to no other Liens whatsoever, except Permitted Liens.
 
3.15 Federal Regulations.
 
No part of the proceeds of any Loans will be used for “purchasing” or “carrying”
any “margin stock” within the respective meanings of each of the quoted terms
under Regulation U or for any purpose which violates the provisions of
Regulation U or any other Regulations of the Board of Governors of the Federal
Reserve System.  If requested by any Lender or the Administrative Agent, the
Borrower will furnish to the Administrative Agent and each Lender a statement to
the foregoing effect in conformity with the requirements of FR Form U-l referred
to in said Regulation U.  No part of the proceeds of the Loans hereunder will be
used for any purpose which violates, or which is inconsistent with, the
provisions of any of Regulations D, T, U and X.
 
3.16 ERISA.
 
Except as specifically disclosed on Schedule 3.16 to this Agreement:  (a) there
is no Accumulated Funding Deficiency with respect to any Employee Pension Plan,
(b) there is no Unpaid Minimum Required Contribution with respect to any
Employee Pension Plan, (c) no Reportable Event (excluding those for which notice
has been waived by the PBGC) has occurred with respect to any Employee Pension
Plan, (d) neither the Parent nor any Commonly Controlled Entity has incurred
Withdrawal Liability with respect to any Multiemployer Plan, and (e) no
Multiemployer Plan is in Reorganization.  No liability (whether or not such
liability is being litigated) in excess of $250,000 has been asserted against
the Parent or any Commonly Controlled Entity in connection with any Employee
Pension Plan or any Multiemployer Plan by the PBGC, by a trustee appointed
pursuant to Section 4042(b) or (c) of ERISA, or by a sponsor or a trustee or an
agent of a sponsor or trustee of a Multiemployer Plan, and no Lien has attached
or been perfected and no Person has, to the Borrower’s knowledge, threatened to
attach or perfect a Lien on any of the Parent’s or any Commonly Controlled
Entity’s property as a result of failure to comply with ERISA or the Code or as
a result of the termination of any Employee Pension Plan.  Each Employee Pension
Plan, as most recently amended, including amendments to any trust agreement,
group annuity or insurance contract, or other governing instrument, is the
subject of a favorable determination by the Internal Revenue Service with
respect to its qualification under Section 401(a) of the Code, and to the
knowledge of the Borrower, no amendment adopted after such determination
negatively affects the qualification of such Plan.  Neither the Parent nor any
Commonly Controlled Entity has an unfulfilled obligation to contribute to any
Multiemployer Plan.  No Employee Pension
 

 
60

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

 

Plan that is subject to Section 436 of the Code has an Adjusted Funding Target
Attainment Percentage that is less than, or is presumed under Section 436 of the
Code to be less than, eighty percent (80%).
 
3.17 Fictitious Names.
 
Neither the Parent nor its Subsidiaries operate or do business under any
assumed, trade or fictitious names, other than as listed on Schedule 3.17, or if
after the date hereof, disclosed to the Administrative Agent in writing.
 
3.18 No Event of Default.
 
No Default or Event of Default has occurred and is continuing.
 
3.19 Solvency.
The Parent and its Subsidiaries on a consolidated basis, are, and after receipt
and application of any Loans hereunder, including the initial Loans will be,
Solvent.
 
3.20 Investment Company Act
 
Neither the Parent, the Borrower nor any Subsidiary thereof is an “investment
company,” or a company “controlled” by an “investment company,” within the
meaning of the Investment Company Act of 1940, as amended.
 
3.21 Environmental Matters.
 
Except to the extent that all of the following would not reasonably be expected
to have a Material Adverse Effect:
 
(a) The Properties do not contain, and have not previously contained, in, on, or
under, including, without limitation, the soil and groundwater thereunder, any
Materials of Environmental Concern in amounts or concentrations that constitute
or constituted a violation of, or reasonably would be expected to give rise to
liability under Environmental Laws.
 
(b) The Properties and all operations and facilities at the Properties are in
compliance, and have in the last five years been in compliance with all
Environmental Laws, and there is no contamination at, under or about the
Properties or violation of any Environmental Law with respect to the Properties
or the business operated by the Parent and its Subsidiaries which would
reasonably be expected to interfere with the continued operation of any of the
Properties or impair the fair saleable value of any thereof.  Neither the Parent
nor any Subsidiary has assumed any liability of any Person under Environmental
Laws.
 
(c) Neither the Parent nor any Subsidiary has received nor is it aware of any
claim, notice of violation, alleged violation, non-compliance, investigation or
advisory action or potential liability regarding environmental matters or
compliance of Environmental Law with regard to the Properties which has not been
satisfactorily resolved by the Parent or its Subsidiary and neither the Parent
nor any Subsidiary is aware and has no reason to believe that any such action is
being contemplated, considered or threatened.
 
(d) Materials of Environmental Concern have not been generated, treated, stored,
transported, disposed of, at, on, from or under any of the Properties by the
Parent or any of its Subsidiaries, nor have any Materials of Environmental
Concern been transferred by the Parent or any of its Subsidiaries from the
Properties to any other location except in either case in the ordinary course of
business of the Parent and its Subsidiaries in compliance with all Environmental
Laws and such that it would not reasonably be expected to give rise to liability
under any applicable Environmental Law.
 

 
61

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

 
 
(e) There are no governmental, administrative actions or judicial proceedings
pending or, to the best knowledge of the Borrower, contemplated or threatened
under any Environmental Laws to which the Parent or any of its Subsidiaries is
or will be named as a party with respect to the Properties, nor are there any
consent decrees or other decrees, consent orders, administrative orders or other
orders, or other administrative or judicial requirements outstanding under any
Environmental Law with respect to any of the Properties.
 
3.22 Labor Matters.
 
Except as set forth on Schedule 3.22, as of the Closing Date, there are no
collective bargaining agreements or Multiemployer Plans covering the employees
of the Parent or its Subsidiaries, and neither the Parent nor its Subsidiaries
has suffered any strikes, walkouts, work stoppages or other material labor
difficulty within the last five years and to the knowledge of the Borrower,
there are none now threatened.
 
3.23 Anti-Terrorism Laws.
 
                                 (a)  Neither the Parent, its Subsidiaries nor,
to the Borrower’s knowledge, their Affiliates are in violation of any
Anti-Terrorism Law nor does the Parent or its Subsidiaries engage in or conspire
to engage in any transaction  that evades or avoids, or has the purpose of
evading or avoiding, or attempts to violate, any of the prohibitions set forth
in any Anti-Terrorism Law.
 
(b) Executive Order No. 13224.  Neither the Parent, its Subsidiaries nor, to the
Borrower’s knowledge, any of their Affiliates or agents acting or benefiting in
any capacity in connection with the extensions of credit or other transactions
hereunder, is any of the following (each a “Blocked Person”):
 
(i) a Person that is listed in the annex to, or is otherwise subject to the
provisions of, Executive Order No. 13224;
 
(ii) a Person owned or controlled  by, or acting for or on behalf of, any Person
that is listed in the annex to, or is otherwise subject to the provisions of,
Executive Order No. 13224;
 
(iii) a Person or entity with which any Lender is prohibited from dealing or
otherwise engaging in any transaction by any Anti-Terrorism Law;
 
(iv) a Person or entity that commits, threatens or conspires to commit or
supports “terrorism” as defined in Executive Order No. 13224;
 
(v) a Person or entity that is named as a “specially designated national” on the
most current list published by the U.S. Treasury Department Office of Foreign
Asset Control at its official website or any replacement website or other
replacement official publication of such list; or
 
(vi) a person or entity who is affiliated or affiliated with a person or entity
listed above.  The Parent does not nor, to the Borrower’s knowledge, does any of
the Parent’s Subsidiaries, Affiliates or agents acting in any capacity in
connection with the extensions of credit hereunder or other transactions
hereunder (x) conduct any business or engage in making or receiving any
contribution of funds, goods or services to or for the benefit of any Blocked
Person, or (y) deal in, or otherwise engage in any transaction relating to, any
property or interests in property blocked  pursuant to the Executive Order No.
13224.
 

 
62

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

 

                                 3.24 Salary.com Acquisition.
 
                                 (a) Complete and correct copies of the
principal Salary.com Acquisition Documents have been provided to the
Administrative Agent.
 
(b) Each of the Loan Parties party to a Salary.com Acquisition Document
(A) had  the corporate power and authority under the laws of its jurisdiction of
organization and under its other organizational documents to enter into and
perform the Salary.com Acquisition Documents to which it is a party and (B) has
taken all actions (corporate or otherwise) necessary for the execution and
performance by it of the Salary.com Acquisition Documents to which it is a
party.  The Salary.com Acquisition Documents constitute the valid and binding
obligation of each Loan Party or Subsidiary party thereto, enforceable against
such Loan Parties and Subsidiaries in accordance with their respective terms,
except that the enforceability of the obligations of the parties under the
Salary.com Acquisition Documents is subject to the provisions of bankruptcy,
insolvency, reorganization, moratorium or other similar laws and is subject to
general equity principles which may limit the specific enforcement of certain
remedies.
 
(c) The making and performance of the Salary.com Acquisition Documents does not
in any material respects violate any provision of any law or regulation,
federal, state or local, and does not violate any provisions of the
organizational documents of any Loan Party or Subsidiary, or constitute a
default under any material agreement by which any Loan Party, any Subsidiary or
its or their property may be bound.  No contracts that are material, in the
aggregate which were acquired in the Salary.com Acquisition may be terminated by
the counterparty(ies) thereto as a result of the Salary.com Acquisition and the
change of ownership occasioned thereby.
 
(d) The Salary.com Acquisition has been consummated in accordance with the terms
of the Salary.com Acquisition Documents.
 
                                 3.25 No Burdensome Agreements
 
Neither the Parent nor any Subsidiary thereof is a party to or bound by any
agreement or instrument or subject to any corporate or other restriction the
performance or observance of which now has or, as far as the Borrower can
reasonably foresee, would reasonably be expected to have, a Material Adverse
Effect.
 
3.26 No Misrepresentations or Material Nondisclosures
 
Neither this Agreement nor any other document, certificate or statement
furnished to the Administrative Agent or the Lenders in connection herewith
contains any untrue statement of a material fact or omits to state a material
fact necessary in order to make the statements contained herein and therein not
misleading.  As of the Closing Date, there is no fact known to the Borrower
which now or in the future (so far as the Borrower can reasonably foresee) would
reasonably be expected to have a Material Adverse Effect which has not been set
forth in this Agreement or in the other documents, certificates and statements
furnished to the Lenders in connection with the transactions contemplated
hereby.
 
All of the foregoing representations and warranties shall survive the execution
and delivery of the Notes and the making by the Lenders of the Loans and
issuance of Letters of Credit hereunder and shall continue in full force and
effect so long as any indebtedness or obligation of the Borrower to the Lenders
and/or the Administrative Agent hereunder or under the other Loan Documents is
outstanding or unperformed or this Agreement remains in effect.

 
63

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

 
 
SECTION 4.  CONDITIONS PRECEDENT
 
4.1 Conditions to Closing.
 
The agreement of each Lender to enter into this Agreement and to make the
initial Loans requested to be made and the Issuing Bank and each Revolving
Credit Lender to issue and/or participate in Letters of Credit requested to be
issued on the Closing Date is subject to the satisfaction on and as of the
Closing Date of the following conditions precedent:
 
(a) Credit Agreement and Notes.  The Administrative Agent shall have received
(i) this Agreement, (A) executed and delivered by a duly authorized officer of
the Borrower, with a counterpart for each Lender, and (B) executed and delivered
by a duly authorized officer of the Administrative Agent and each Lender,
(ii) for the account of each (as applicable) Lender, a Revolving Credit Note,
Term Note and/or Swing Line Note, with each such Note conforming to the
requirements hereof and executed by a duly authorized officer of the Borrower.
 
(b) Other Loan Documents.  The Administrative Agent shall have received each of
the Security Documents and other Loan Documents duly executed and delivered by
each party thereto (including any stock certificates and undated stock powers
unless otherwise agreed by the Administrative Agent in its sole
discretion).  Any document (including without limitation UCC financing
statements) required to be filed, registered or recorded in order to create, in
favor of the Administrative Agent for the benefit of the Lenders, a perfected,
first priority Lien (subject only to Permitted Liens), shall have been filed,
registered or recorded and/or properly prepared for filing, registration or
recording in each office in each jurisdiction in which such filings,
registration and recordation are required to perfect such first priority
security interests created by the Security Documents, and the Administrative
Agent shall be satisfied that all such recordings and filings have been or will
be completed promptly following the Closing Date and that all necessary filing,
recording and other fees and all taxes and expenses related to such filings,
registrations and recordings have been or will be paid in full by the Borrower.
 
(c) Loan Party Certificates.  The Administrative Agent shall have received a
certificate of the Secretary or Assistant Secretary of the Borrower and the
other Loan Parties certifying the resolutions of the board of directors of such
Person and true and correct copies of the certificate or articles of
incorporation, bylaws or other applicable governing documents of such Person and
the signatures and incumbency of the officers of such Person authorized to sign
the Loan Documents to which it is a party, and such certificates and attachments
thereto shall be in form and substance satisfactory to the Administrative Agent.
 

 
64

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

 
 
(d) Existing Credit Arrangements.  The Existing Credit Agreement and any
existing credit facilities relating to the Salary.com Acquisition shall have
been terminated, all Indebtedness thereunder shall have been paid in full and
the Liens securing any such Indebtedness shall have been released and payoff
letters shall have been delivered to the Administrative Agent and be in a form
acceptable to the Administrative Agent.
 
(e) Fees.  Each of the Administrative Agent and the Lead Arranger shall have
received all fees to be received by it individually or on behalf of the Lenders
on the Closing Date pursuant to the Fee Letter.
 
(f) Legal Opinions.  The Administrative Agent shall have received the executed
legal opinion of Pepper Hamilton, LLP, counsel to the Borrower and the other
Loan Parties, and such other opinions as shall be required by the Administrative
Agent.  Such opinions shall be addressed to the Lenders and the Administrative
Agent and cover such matters incident to the transactions contemplated by this
Agreement as the Administrative Agent may reasonably require.
 
(g) UCC Filing and Other Searches.  The Administrative Agent shall have received
the results of (i) Uniform Commercial Code searches made with respect to each of
the Parent, the Borrower, the other Loan Parties (including any Domestic
Subsidiaries acquired or formed in connection with the Salary.com Acquisition),
together with copies of financing statements disclosed by such searches and
(ii) such tax and judgment lien searches as the Administrative Agent shall
reasonably request, and each of the foregoing searches shall disclose no Liens,
except for Permitted Liens or, if unpermitted Liens are disclosed, the
Administrative Agent shall have received satisfactory evidence of the release of
such Liens.
 
(h) Insurance.  The Administrative Agent shall have received certificates of
insurance with respect to the Parent’s, the Borrower’s and the other Loan
Parties’ fire, casualty, liability and other insurance covering its respective
property and business, including lender loss payee endorsements in favor of the
Administrative Agent on Acord Form 27.
 
(i) Good Standing.  The Administrative Agent shall have received certificates of
good standing, subsistence and/or status dated a recent date from the Secretary
of State or appropriate authorities in the state of formation of each of the
Borrower and the other Loan Parties.
 
(j) No Material Adverse Effect; Closing Certificate.  No Material Adverse Effect
shall have occurred since December 31, 2009.  The Administrative Agent shall
have received a certificate from the Borrower and the other Loan Parties, dated
as of the Closing Date, and executed by a Responsible Officer of such party
stating that, as of the Closing Date (i) all of the representations and
warranties made by such party herein and in the other Loan Documents are true
and correct in all material respects (except that representations and warranties
that expressly relate to an earlier date are true and correct in all material
respects as of such date), (ii) no Default or Event of Default exists and
(iii) no Material Adverse Effect has occurred since December 31, 2009.
 

 
65

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

 
                                 (k) Governmental Approvals.  The Administrative
Agent shall have received evidence that any necessary authorizations from any
Governmental Authority for the consummation of the transactions contemplated
hereby have been obtained.
 
(l) [Intentionally Omitted]
 
(m) Salary.com Acquisition.  The Administrative Agent shall have received a
certificate from the Borrower certifying that (i) the Salary.com Acquisition has
been consummated on terms and conditions consistent with the terms of the
Salary.com Acquisition Documents, (ii) the purchase price paid in connection
with the Salary.com Acquisition did not exceed $85,000,000 (excluding reasonable
transaction expenses) and (iii) such aggregate purchase price was partially
funded with cash from the Parent and its Subsidiaries and cash on hand of the
Target in an aggregate amount of at least $45,000,000.  The Administrative Agent
shall have received signed copies of the Salary.com Acquisition Documents and
all of the documents, agreements or instruments evidencing any seller notes or
earn-outs.  The Administrative Agent also shall have received a detailed
breakdown of the expected cost savings which are personnel related or specific
third-party costs that are expected to be implemented within sixty (60) days
after the Closing Date (by position, including compensation, etc.).
 
(n) Closing Financial Condition Certificate.  The Borrower shall have delivered
to the Administrative Agent a certificate dated as of the Closing Date and
executed by a Responsible Officer of the Borrower, with calculations attached
thereto, evidencing a minimum Liquidity Level after giving effect to the Loans
made by the Lenders on the Closing Date and the issuance of any Letters of
Credit by the Issuing Bank on such date of at least $10,000,000.
 
(o) Financial Statements and Projections.  The Borrower shall have delivered to
the Administrative Agent and the Lenders (i) consolidated pro forma financial
statements for the Parent and its Subsidiaries for the fiscal quarters ended
March 31, 2010 and June 30, 2010, (ii) consolidated financial projections on a
quarterly basis for the 2010 and 2011 fiscal years, (iii) consolidated financial
projections on an annual basis for the 2012 and 2013 fiscal years, (iv) an
analysis of the variance between Adjusted EBITDA for the 2008 and 2009 fiscal
years and (v) an analysis of the variance between Adjusted EBITDA for the period
commencing January 1, 2010 and the comparable period in 2009.
 
(p) Principal Deposit Accounts.  The Borrower and the other Loan Parties (other
than the Target and its Subsidiaries) shall have established their principal
deposit accounts at PNC.
 
(q) Additional Matters.  All corporate and other proceedings, and all documents,
instruments and other legal matters in connection with the transactions
contemplated by this Agreement and the other Loan Documents shall be
satisfactory in form and substance to the Administrative Agent, and the
Administrative Agent shall have received such other documents and legal opinions
in respect of any aspect or consequence of the transactions contemplated hereby
or thereby as it shall reasonably request.
 

 
66

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

 

4.2 Conditions to Each Loan or Letter of Credit.
 
The agreement of each Lender to make any Loan requested to be made by it and of
the Issuing Bank and each Revolving Credit Lender to issue and/or participate in
Letters of Credit requested to be issued on any date (including the Closing
Date) is subject to the satisfaction of the following conditions precedent:
 
(a) Representations and Warranties.  Each of the representations and warranties
made by the Borrower or any other Loan Party herein or under the other Loan
Documents shall be true and correct in all material respects on and as of such
date as if made on and as of such date (except to the extent that such
representations and warranties relate expressly to an earlier date in which case
such representations and warranties shall be true and correct in all material
respects as of such earlier date).
 
(b) No Default.  No Default or Event of Default shall have occurred and be
continuing on such date or after giving effect to the making of such Loan or
issuing such Letter of Credit.
 
(c) No Material Adverse Effect.  At the time of making such Loan or issuing such
Letter of Credit, no Material Adverse Effect since December 31, 2009 shall have
occurred and be continuing.
 
(d) Loan Requests/Applications.  The Borrower shall have delivered to the
Administrative Agent a duly executed and completed Notice of Borrowing or to the
Issuing Bank an application for a Letter of Credit, as the case may be.
 
Each request by the Borrower for a Loan or Letter of Credit hereunder shall
constitute a representation and warranty by the Borrower as of the date thereof
that the conditions contained in this Section 4.2 have been satisfied.
 
4.3 Closing.
 
The closing (the “Closing”) of the transactions contemplated hereby shall take
place at the offices of Ballard Spahr LLP, 1735 Market Street, Philadelphia, PA
19103, commencing at 10:00 A.M., Philadelphia time, on October 20, 2010, or such
other place or date as to which the Administrative Agent, the Lenders and the
Borrower shall agree.  The date on which the Closing shall be completed is
referred to herein as the “Closing Date”.
 
 
 

 
67

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

 
 
SECTION 5.   AFFIRMATIVE COVENANTS
 
The Borrower hereby agrees that, so long as the Revolving Credit Commitments
remain in effect, any Note or Letter of Credit remains outstanding and unpaid,
or any other amount is owing to any Lender or the Administrative Agent hereunder
or under any other Loan Document, the Borrower shall and (except in the case of
delivery of financial information, reports and notices and Section 5.17) shall
cause the Parent and each of its other Subsidiaries to:

5.1 Furnishing Financial Statements.
 
Furnish or cause to be furnished to the Administrative Agent (and, in the case
of clauses (a), (b), (c) and (f)-(j) below, the Administrative Agent shall
promptly after receipt provide to the Lenders to the extent that it is aware
that the Borrower has not done so):
 
(a) as soon as available, but in any event not later than 90 days (or such
earlier date mandated by the SEC) after the close of each fiscal year of the
Parent, a copy of the annual audit report for such year for the Parent and its
consolidated Subsidiaries, including therein a consolidated balance sheet of the
Parent and its consolidated Subsidiaries as at the end of such fiscal year, and
related consolidated statements of income and retained earnings and changes in
cash flows of the Parent and its consolidated Subsidiaries for such fiscal year,
all in reasonable detail, prepared in accordance with GAAP applied on a basis
consistently maintained throughout the period involved and with the prior year
with such changes thereon as shall be approved by the Parent’s independent
certified public accountants, such financial statements to be certified by a
Grant Thornton LLP or other nationally recognized independent certified public
accountants selected by the Parent and reasonably acceptable to the
Administrative Agent, without a “going concern” or like qualification or
exception or qualification arising out of the scope of the audit;
 
(b) as soon as available, but in any event not later than 45 days after the end
of each fiscal quarter of the Parent (other than the last fiscal quarter),
unaudited consolidated financial statements of the Parent and its consolidated
Subsidiaries, including therein (i) a consolidated balance sheet of the Parent
and its consolidated Subsidiaries as at the end of such fiscal quarter, (ii) the
related consolidated statements of income and retained earnings of the Parent
and its consolidated Subsidiaries, and (iii) the related consolidated statement
of changes in cash flows of the Parent and its consolidated Subsidiaries all for
the period from the beginning of such fiscal quarter to the end of such fiscal
quarter and the portion of the fiscal year through the end of such quarter
setting forth in each case in comparative form the corresponding figures for the
like period of the preceding fiscal year; all in reasonable detail, prepared in
accordance with GAAP applied on a basis consistently maintained throughout the
period involved and with prior periods (except for the absence of footnotes and
subject to year-end adjustments) and accompanied by a certificate of a
Responsible Officer of the Parent stating that the financial statements fairly
present the financial condition of the Parent and its consolidated Subsidiaries
as of the date and for the periods covered thereby;
 
The financial statements required to be delivered pursuant to clauses (a) and
(b) of this Section 5.1 shall be deemed to have been delivered on the date on
which such report is posted on the website of the Securities and Exchange
Commission at www.sec.gov and Borrower notifies Administrative Agent in writing
thereof.
 
(c) concurrently with the delivery of:
 
(i) the financial statements referred to in subsection 5.1(a), a certificate of
the Parent’s independent certified public accountants reporting on such
financial statements stating that in making the examination necessary for
certifying such financial statements no knowledge was obtained of any Event of
Default under Section 6.1 hereof, except as specifically indicated;
 

 
68

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

 

(ii) the annual and quarterly financial statements referred to in subsections
5.1(a) and 5.1(b), respectively, a certificate of a Responsible Officer of the
Borrower (each a “Compliance Certificate”) showing in detail the calculations
demonstrating compliance with the financial covenants set forth in Section 6.1
and the Applicable Margin and Applicable Commitment Fee Percentage, together
with a certificate of a Responsible Officer of the Borrower stating that, to his
or her knowledge, the Borrower during such period has kept, observed, performed
and fulfilled each and every covenant and condition contained in this Agreement
and in the Notes and the other Loan Documents to which it is a party and that
such officer has obtained no knowledge of any Default or Event of Default except
as specifically indicated; if the Compliance Certificate shall indicate that
such officer has obtained knowledge of a Default or Event of Default, such
Compliance Certificate shall state what efforts the Borrower is making to cure
such Default or Event of Default; and
 
(iii) the financial statements referred to in subsections 5.1(a) and 5.1(b),
sufficient financial information to permit the Lenders to calculate Modified
EBITDA, including with respect to any Person who has (or whose assets have) been
acquired in a Permitted Acquisition and who is (or whose assets have been) owned
for less than four (4) full fiscal quarters, calculations on a quarterly basis
of the EBITDA attributable to such Person (or such assets) for the applicable
period prior to such acquisition.
 
(d) promptly, such additional financial and other information as the
Administrative Agent or any Lender may from time to time reasonably request;
 
(e) promptly after the same are available, quarterly account statements with
respect to each Unrestricted Investment Account demonstrating the amount of cash
and/or Cash Equivalents maintained in such Unrestricted Investment Accounts by
the Parent and/or its Subsidiaries during such quarter, together with
documentation in sufficient detail, including summary sheets, to permit the
Administrative Agent to confirm any deduction by any Loan Party from Total Net
Debt on account of cash and Cash Equivalents maintained in Unrestricted
Investment Accounts;
 
(f) promptly following the execution thereof, a copy of any letter of intent
executed by the Borrower or any Subsidiary thereof in respect of a proposed
acquisition for which the proposed Consideration is $10,000,000 or more;
 
(g) any reports, notices or proxy statements generally distributed by the Parent
to its stockholders on a date no later than the date supplied to such
stockholders;
 
(h) simultaneously with the delivery of the financial statements required under
subsection 5.1(a), but in any event on or before ninety (90) days after the end
of each fiscal year, (i) a budget for the current fiscal year (and, if
available, for the next fiscal year) approved by the board of directors of the
Parent (each a “Budget”), and copies of any updates to such Budget prepared by
or for the Parent or any Subsidiary thereof and (ii) projections through the
later of the Revolving Credit Termination Date and the Term Loan Maturity Date;
and promptly upon request, such additional or updated Budgets, projections,
reports (including inventory reports) and other information regarding the
operations, business affairs and financial condition of the Borrower and the
other Loan Parties as the Required Lenders may, from time to time, reasonably
request;
 

 
69

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

 
 
(i) not later than ninety (90) days after the Closing Date (or such longer
period as agreed to by the Required Lenders in their sole discretion), a
detailed report by a Person selected by the Administrative Agent and reasonably
acceptable to the Borrower detailing the annual personnel related and specific
third-party cost savings in connection with the integration of the Target after
the Merger, including by position including compensation, which cost savings
have actually been implemented within sixty (60) days after the Closing Date (or
such longer period as agreed to by the Required Lenders in their sole
discretion), such report to be in form and content acceptable to the
Administrative Agent in its discretion; and
 
(j) promptly after the same become publicly available, copies of all periodic,
other reports, proxy statements or other materials filed by the Parent or any
Subsidiary thereof with the SEC, or any Governmental Authority succeeding to any
or all of the functions of the SEC, or with any national securities exchange, or
distributed to its equityholders, as the case may be.
 
All balance sheets, statements and other information furnished pursuant hereto
shall be prepared in accordance with GAAP, except for the absence of footnotes
and subject to year-end adjustments in the case of the unaudited financial
statements, and shall fairly set forth the consolidated financial condition of
the Parent and its Subsidiaries and the results of their operations.  The
Lenders shall have the right, from time to time, to discuss the Loan Parties’
affairs directly with the Parent’s independent certified public accountants
after notice to the Borrower and the opportunity for the Borrower to be present
at any such discussions.  The Administrative Agent and each Lender is authorized
to show or deliver a copy of any financial statement or any other information
relating to the business, operations or financial condition of the Parent and
its Subsidiaries which may be furnished to any Lender or come to its attention
pursuant to this Agreement or otherwise, to any regulatory body or agency having
jurisdiction over such Lender and to any bank or other financial institution
which is a present or potential participant with such Lender in the Loans and
other extensions of credit hereunder, provided such bank or financial
institution agrees to keep such information confidential on the terms hereof.
 
5.2 Books and Records.
 
Maintain proper and complete books and records of account in which shall be set
forth accurately and in accordance with GAAP, all of its dealings and
transactions.
 
5.3 Taxes.
 
Pay when due all taxes, assessments, charges and levies imposed upon it or any
of its properties or which it is required to withhold and pay over, and provide
evidence of such payment to the Administrative Agent if requested, except where
such taxes, assessments or charges shall be contested in good faith by
appropriate proceedings and where adequate reserves therefor have been set aside
on its books, provided that the Parent and its Subsidiaries shall pay or cause
to be paid all such taxes, assessments, charges, and levies forthwith whenever
foreclosure on any Lien that attaches (or security therefor) appears imminent.
 

 
70

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

 

5.4 Corporate Existence and Rights; Compliance with Laws.
 
Preserve and keep in full force and effect its corporate existence, rights,
permits, patents, franchises, licenses, trademarks and trade names and other
Intellectual Property and comply with any and all laws, regulations, rules or
requirements of any federal agency or department and of any state, local or
municipal government, agency or department which may at any time be applicable
to it, except to the extent failure to do so would not reasonably be expected to
have a Material Adverse Effect.
 
5.5 Maintenance of Properties.
 
Maintain all of its tangible property (except for obsolete property not yet
disposed of) in good repair, working order and condition and, from time to time,
make all appropriate and proper repairs, renewals, replacements, additions and
improvements thereto, except to the extent failure to do so would not reasonably
be expected to have a Material Adverse Effect.
 
5.6 Performance and Compliance with Material Agreements.
 
Perform and comply with each of the provisions of all Loan Documents and, except
to the extent failure to do so would not otherwise cause an Event of Default or
would not reasonably be expected to have a Material Adverse Effect, all other
material agreements.
 
5.7 Insurance.
 
Carry at all times, in coverage, form and amount reasonably satisfactory to the
Administrative Agent (and, in any event in such amounts and covering such risks
as is consistent with sound business practice and other similarly situated
companies), hazard insurance and business interruption coverage (with fire,
extended coverage, vandalism, malicious mischief coverage and business
interruption coverage and coverage against such other hazards as are customarily
insured against by companies in the same or similar business), comprehensive
general liability insurance, worker’s compensation insurance, comprehensive
automobile liability insurance and such other insurance as may be required by
the Loan Documents and as the Administrative Agent may from time to time
reasonably require, and pay all premiums on the policies for such insurance when
and as they become due and do all other things necessary to maintain such
policies in full force and effect.  The Borrower shall from time to time upon
request by the Administrative Agent or the Required Lenders, promptly furnish or
cause to be furnished to the Administrative Agent or the Lenders evidence in
form and substance satisfactory to the Administrative Agent or the Required
Lenders, of the maintenance of all insurance required to be maintained by this
Section 5.7 including, but not limited to, such originals or copies as the
Administrative Agent or the Required Lenders may request of policies,
certificates of insurance, riders and endorsements relating to such insurance
and proof of premium payments.  The Borrower shall cause all hazard insurance
policies and any policies insuring the inventory and equipment covered by the
Security Agreement to provide, and the insurers issuing such policies to certify
to the Lenders, that (a) the interest of the Administrative Agent shall be
insured regardless of any breach or violation by the Parent or any Subsidiary
thereof or the holder or owner of the policies of any warranties, declarations
and conditions contained in such policies; (b) if such insurance be proposed to
be canceled or materially changed for any reason whatsoever, such insurer will
promptly notify the Administrative Agent and such cancellation or change shall
not be effective as to the Administrative Agent for thirty (30) days after
receipt by the Administrative Agent of such notice, unless the effect of such
change is to extend or increase coverage under the policy; (c) the
Administrative Agent and the Lenders will have the right at their election to
remedy any default in the payment of premiums within thirty (30) days of notice
from the insurer of such default; and (d) loss payments in each instance will be
payable to the Administrative Agent as secured party, or otherwise as its or the
Lenders’ interests may appear.  The Administrative Agent, its officers,
employees and authorized agents, are hereby irrevocably appointed
attorneys-in-fact of the Borrower to endorse any draft or check which may be
payable to the Administrative Agent, in order to collect the proceeds of such
insurance covering the collateral and distribute the same as the Required
Lenders may determine; provided that, if at the time of receipt of any such
proceeds no Event of Default has occurred and is continuing, such proceeds shall
be released to the Borrower to pay the costs of repairing, restoring or
replacing the assets lost, damaged or destroyed or for other corporate purposes.
 

 
71

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

 
 
5.8 Inspection; Collateral Audit.
 
Permit any representative of the Administrative Agent and the Lenders to visit
and inspect any of its properties, to examine its books of account and other
records and files, to make copies thereof, and to discuss their affairs,
business, finances and accounts with its officers and employees, all at such
reasonable times and as often as the Administrative Agent or any Lender may
reasonably request, provided that such inspections shall not unreasonably
interfere with the conduct of the Loan Parties’ business.  All reasonable costs
incurred by the Administrative Agent and the Lenders in connection with up to
two (2) such inspections conducted in any calendar year shall be paid by the
Borrower; provided, however, the Borrower also shall pay all such costs in
connection with any such inspections during the existence of a Default or Event
of Default.  The inspections are solely for the protection of the Administrative
Agent and the Lenders and no action or inaction of the Administrative Agent or
the Lenders shall constitute any representation that the Borrower is in
compliance with the terms of this Agreement or that the Administrative Agent or
the Lenders approve of the Loan Parties’ affairs, business, finances or
accounts.
 
5.9 Leases and Mortgages.
 
Pay all rent or other sums required by any lease or mortgage to which it is a
party as the same becomes due and payable, duly perform and comply with all of
its other obligations as tenant or mortgagor thereunder, except to the extent
that any such obligation is the subject of a good faith dispute and adequate
reserves have been set aside therefor, and keep all such leases in full force
and effect, except to the extent the absence or loss of such lease would not
reasonably be expected to have a Material Adverse Effect.
 
5.10 Pay Indebtedness and Perform Other Covenants.
 
Make full and timely payment of the principal of, and interest on, the Notes,
the Reimbursement Obligations, the Commitment Fees and (except to the extent
non-payment of such Indebtedness would not violate Section 7.1(f)) all other
Indebtedness of the Loan Parties, whether now existing or hereafter arising, and
duly comply with all covenants and agreements set forth in or required pursuant
to any other agreement or document previously, concurrently or hereafter
executed or delivered by the Loan Parties in connection with this Agreement,
except that the Loan Parties may contest in good faith after making appropriate
reserves therefor amounts owing in respect of Indebtedness other than
Indebtedness arising under the Loan Documents.
 

 
72

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

 

5.11 Notices.
 
Promptly give notice to the Administrative Agent on behalf of the Lenders of:
 
(a) as soon as the Borrower has knowledge, the occurrence of any Default or
Event of Default;
 
(b) any (i) default or event of default under any material Contractual
Obligation of the Parent or any of its Subsidiaries or (ii) litigation,
investigation or proceeding which may exist at any time between the Parent or
any of its Subsidiaries and any Governmental Authority, which in either case, if
not cured or if adversely determined, as the case may be, would reasonably be
expected to have a Material Adverse Effect or result in a liability in excess of
$500,000;
 
(c) any litigation or proceeding which could give rise to a liability of the
Parent or any of its Subsidiaries of $500,000 or more and not covered by
insurance as reasonably determined by the Borrower’s corporate counsel or in
which injunctive or similar relief is sought;
 
(d) the occurrence or existence of a material default by any party, including
the Parent or any of its Subsidiaries, to any material contract to which the
Parent or a Subsidiary is a party, or the actual or threatened termination,
revocation or non-renewal of any such material contract;
 
(e) entry of any order, judgment, decree or decision issued by any court,
arbitrator or Governmental Authority in any proceeding to which the Parent or
any of its Subsidiaries is a party and which would individually or in the
aggregate reasonably be expected to have a Material Adverse Effect;
 
(f) any material default, event of default or breach by any Person under any
Salary.com Acquisition Document; and
 
(g) any other event which, to the Borrower’s knowledge, has had or would
reasonably be expected to have a Material Adverse Effect.
 
Each notice pursuant to this subsection shall be accompanied by a statement of a
Responsible Officer of the Borrower setting forth details of the occurrence
referred to therein and stating what action the Borrower proposes to take with
respect thereto.  Upon the request of the Administrative Agent, the Borrower
shall send (or cause to be sent) to the Administrative Agent and/or the Lenders
copies of all Federal, state, local and foreign tax returns and reports filed by
the Parent or any of its Subsidiaries in respect of taxes measured by income.
 
5.12 Deposit Accounts.
 
Except with respect to the Target and its Subsidiaries, maintain its principal
domestic deposit accounts with PNC.  Within sixty (60) days of the Closing Date,
open and thereafter maintain the principal domestic deposit accounts of the
Targets and their Subsidiaries at PNC.
 

 
73

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

 

5.13 ERISA.
 
Furnish to the Administrative Agent (a) promptly and in any event within 30 days
after it has knowledge (i) that it or any Commonly Controlled Entity has
incurred Withdrawal Liability, (ii)  that any Multiemployer Plan is in
Reorganization, (iii) that any Reportable Event or Foreign Benefit Event has
occurred with respect to any Employee Pension Plan, (iv) that PBGC has
instituted or will institute proceedings under Title IV of ERISA to terminate
any Employee Pension Plan or to appoint a trustee to administer any Employee
Pension Plan or (v) that any Employee Pension Plan that is subject to
Section 436 of the Code has an adjusted funding target attainment percentage (as
defined in Section 436 of the Code) that is less than, or is presumed under
Section 436 of the Code to be less than, eighty percent (80%), a statement
setting forth the amount of such Withdrawal Liability, the details of the
Reorganization, Reportable Event, Foreign Benefit Event, termination or
appointment proceedings or calculation of the funding target attainment
percentage and the action which it (or the Multiemployer Plan sponsor or
Employee Pension Plan sponsor if other than the Parent or a Subsidiary thereof)
proposes to take with respect thereto, together with a copy of any notice of
Withdrawal Liability or Reorganization given to the Parent, any other Loan Party
or any Commonly Controlled Entity and a copy of the notice of such Reportable
Event given to PBGC or a copy of the notice of such Foreign Benefit Event, in
each case, if a copy of such notice is reasonably available to the Parent, any
Subsidiary thereof or any of the Commonly Controlled Entity, (b) promptly after
receipt thereof, a copy of any notice (i) the Parent, any Subsidiary thereof or
any Commonly Controlled Entity or the sponsor of any Employee Pension Plan
receives from PBGC or the Internal Revenue Service which sets forth or proposes
any negative action or determination with respect to such Employee Pension Plan,
and (ii) the Parent, any Subsidiary thereof or any Commonly Controlled Entity or
the sponsor of any Foreign Benefit Plan receives from any Governmental Authority
regulating such Foreign Benefit Plan which sets forth or proposes any action or
determination with respect to such Foreign Benefit Plan, (c) promptly, and in
any event within fifteen (15) days after receipt thereof, a copy of any Adjusted
Funding Target Attainment Percentage certification by an Employee Pension Plan
actuary if such certification reflects an Adjusted Funding Target Attainment
Percentage of less than 80%, and (d) promptly and in any event within fifteen
(15) days of the date on which such certification should have been received, a
notice of the failure to receive an actuarial certification of the Adjusted
Funding Target Attainment Percentage.  The Borrower will promptly notify the
Administrative Agent of any excise taxes which have been assessed against the
Parent, any Subsidiary thereof or any Commonly Controlled Entity by (x) the
Internal Revenue Service with respect to any Employee Pension Plan or
Multiemployer Plan or (y) the applicable Government Authority regulating any
Foreign Benefit Plan.  Within the time required for notice to the PBGC under
Section 303(k)(4) of ERISA or 430(k)(4)(A) of the Code, the Borrower will notify
the Administrative Agent of any Lien of which the Borrower has knowledge arising
under Section 303(k) of ERISA or 430(k) of the Code in favor of any Employee
Pension Plan.  The Borrower will promptly notify the Administrative Agent of the
following events, and in any event within 30 days after the Borrower knows or
has reason to know thereof: (i) a failure to make any required contribution to
an Employee Pension Plan or a Foreign Benefit Plan, or any withdrawal from, or
the termination, Reorganization or Insolvency of, any Multiemployer Plan or (ii)
assessment of liability under the Coal Industry Retiree Health Benefit Act of
1992.  The Borrower will immediately notify the Administrative Agent of any Lien
in favor of PBGC.
 

 
74

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

 

5.14 Environmental Laws.
 
 
(a) Comply with, and require compliance by all tenants and all subtenants, if
any, with, all Environmental Laws and obtain and comply with and maintain, and
require that all tenants and subtenants obtain and comply with and maintain, any
and all licenses, approvals, registrations or permits required by Environmental
Laws, except to the extent that failure to so comply or obtain or maintain such
documents would not reasonably be expected to have a Material Adverse Effect;
 
(b) Comply with all lawful and binding orders and directives of all Governmental
Authorities respecting Environmental Laws, except to the extent the failure to
so comply would not reasonably be expected to have a Material Adverse Effect;
and
 
(c) Defend, indemnify and hold harmless each of the Agents and the Lenders, and
their respective Affiliates, employees, agents, advisors, officers, directors,
successors and assigns (each, an “Indemnitee”) from and against any claims,
demands, penalties, fines, liabilities, settlements, damages, costs and expenses
of whatever kind or nature known or unknown, contingent or otherwise, arising
out of, or in any way relating to any violation of or noncompliance with or
liability under any Environmental Laws, or any orders, requirements or demands
of Governmental Authorities related thereto which in each case relate to or
arise in connection with the Parent, the Borrower or any Subsidiaries thereof,
any Property or any activities relating to any property or business of the
Parent, the Borrower or any Subsidiaries thereof or the enforcement of any
rights provided herein or in the other Loan Documents, including, without
limitation, attorneys’ and consultants’ fees, response costs, investigation and
laboratory fees, court costs and litigation expenses, except to the extent that
any of the foregoing arise out of the gross negligence or willful misconduct of
such Indemnitee.  This indemnity shall continue in full force and effect
regardless of the termination of this Agreement and the payment of the Notes and
other Obligations.
 
 
5.15 Notice and Joinder of New Subsidiaries.
 
Notify the Administrative Agent as soon as practicable after acquiring or
creating a new Subsidiary, and promptly cause
 
(a) (i) any new Domestic Subsidiary to execute and deliver to the Administrative
Agent (A) a Guaranty (or Joinder, as determined by the Administrative Agent) in
form and substance acceptable to the Administrative Agent pursuant to which it
shall guaranty all of the Obligations and (B) a Security Agreement (or Joinder,
as determined by the Administrative Agent) in form and substance satisfactory to
the Administrative Agent pursuant to which such Domestic Subsidiary shall grant
a security interest to the Administrative Agent in its assets as additional
Collateral for the Obligations and (ii) the owner of such Domestic Subsidiary to
execute and deliver a Pledge Agreement (or Joinder as determined by the
Administrative Agent) in form and substance acceptable to the Administrative
Agent pursuant to which all of the Capital Stock in such Domestic Subsidiary
shall be pledged to the Administrative Agent, for the benefit of the holders of
the Obligations, as Collateral for the Obligations.
 

 
75

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

 

(b) any Domestic Subsidiary that is the owner of any first-tier Foreign
Subsidiary to execute and deliver to the Administrative Agent a Pledge Agreement
(or Joinder as determined by the Administrative Agent) in form and substance
reasonably acceptable to the Administrative Agent pursuant to which one hundred
percent (100%) of the non-voting issued and outstanding Capital Stock and
sixty-five percent (65%) of the issued and outstanding voting Capital Stock of
such Foreign Subsidiary (to the extent owned by the Parent or a Domestic
Subsidiary) shall be pledged to the Administrative Agent, for the benefit of the
holders of the Obligations, as Collateral for the Obligations.
 
(c) in connection with any such Guaranties, Security Agreements, Pledge
Agreements and/or Joinders, the Parent, the Borrower and/or the applicable
Subsidiary or Subsidiaries to execute and deliver or cause to be executed and
delivered such additional documentation as the Administrative Agent shall
reasonably require, including without limitation, to the extent requested,
certificates similar to those referred to in subsection 4.1(c), opinions and
stock certificates, if any, evidencing such Capital Stock (together with undated
stock powers endorsed in blank) and liens and tax searches.
 
5.16 Anti-Terrorism Laws.
 
Neither the Parent, the Borrower nor their Affiliates, Subsidiaries and agents
shall (a) conduct any business or engage in any transaction or dealing with any
Blocked Person, including the making or receiving of any contribution of funds,
goods or services to or for the benefit of any Blocked Person, (b) deal in, or
otherwise engage in any transaction relating to, any property or interests in
property blocked pursuant to Executive Order No. 13224; or (c) engage in or
conspire to engage in any transaction that evades or avoids, or has the purpose
of evading or avoiding, or attempts to violate, any of the prohibitions set
forth in Executive Order No. 13224 or the USA Patriot Act.  The Borrower shall
deliver to the Administrative Agent any certification or other evidence
requested from time to time by the Administrative Agent in its sole discretion,
confirming Borrower’s compliance with this Section 5.16.
 
5.17Hedge Agreements.
 
Within one (1) year following the Closing Date, purchase and enter into, and at
all times thereafter maintain, one or more Hedge Agreements which shall hedge
the interest cost to the Borrower on at least $10,000,000 of the Indebtedness
hereunder.  Each such Hedge Agreement (i) shall provide interest rate protection
for at least twenty-four (24) months from the date of such Hedge Agreement,
(ii) must be reasonably satisfactory to the Administrative Agent in all
respects, (iii) shall be entered into with counterparties reasonably
satisfactory to the Administrative Agent (it being agreed that any Lender shall
be deemed acceptable), and (iv) shall conform to then current International
Swaps and Derivatives Association standards.  All obligations of the Borrower to
any Lender or Affiliate thereof pursuant to any Hedge Agreement entered into
between the Borrower and such Lender or its Affiliate shall be secured by a Lien
on the Collateral.  Any Hedge Agreement entered into between the Borrower and
any Person other than a Lender or Affiliate thereof shall be unsecured.
 

 
76

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

 

SECTION 6.    NEGATIVE COVENANTS
 
The Borrower hereby agrees that, so long as the Revolving Credit Commitments
remain in effect, any Note or Letter of Credit remains outstanding and unpaid,
or any other amount is owing to any Lender or the Administrative Agent hereunder
or under any other Loan Document, the Borrower shall not, and shall not permit
the Parent or any of its Subsidiaries to, directly or indirectly:
 
6.1 Financial Covenants.
 
                                 (a) Total Net Leverage Ratio.  Permit, as of
the last day of any fiscal quarter, commencing with the fiscal quarter ending
September 30, 2010, the Total Net Leverage Ratio to exceed 2.00 to 1.00:
 
                                (b) Fixed Charge Coverage Ratio.  Permit, as of
the last day of any fiscal quarter, commencing with the fiscal quarter ending
September 30, 2010, the Fixed Charge Coverage Ratio to be less than 1.25 to
1.00.
 
6.2 Limitation on Indebtedness.
 
At any time incur, create, assume, or suffer to exist any Indebtedness except:
 
(a) amounts outstanding under the Loan Documents;
 
(b) purchase money Indebtedness on equipment purchased in the ordinary course of
business and Capital Lease Obligations not exceeding, together with any purchase
money Indebtedness or Capital Lease Obligations listed on Schedule 6.2, an
aggregate principal amount at any time outstanding of $5,000,000;
 
(c) Indebtedness existing as of the date hereof described on Schedule 6.2
(including, except with respect to seller notes, any extensions or renewals or
refinancings thereof provided there is no increase in the amount thereof or
other significant change in the terms thereof);
 
(d) Indebtedness in an aggregate amount not to exceed $2,500,000 at any one time
outstanding of a Person which becomes a Subsidiary after the Closing Date,
provided that (i) such Indebtedness existed at the time such Person became a
Subsidiary and was not created in anticipation of the acquisition, (ii)
immediately after giving effect to the acquisition of such Person by the
Borrower or a Subsidiary, no Default or Event of Default shall have occurred and
be continuing and (iii) the Borrower has complied with Section 5.15 hereof;
 
(e) earn-outs in connection with Permitted Acquisitions consummated after the
date hereof (but not seller notes which, for any Permitted Acquisition
consummated on or after the Closing Date, shall only be permitted to the extent
that they constitute Subordinated Debt);
 
(f) unsecured Indebtedness of the Borrower and its Subsidiaries in an aggregate
principal amount not to exceed $500,000 at any time outstanding the proceeds of
which are to be used for the Borrower’s and its Subsidiaries’ general corporate
purposes;
 

 
77

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

 

(g) Subordinated Debt;
 
(h) subject to Section 6.6, Indebtedness owed to a Loan Party or any other
Subsidiary by another Loan Party or any other Subsidiary;
 
(i) other Indebtedness in respect of letters of credit or bank guaranties issued
for the account of Foreign Subsidiaries in an aggregate amount available to be
drawn not to exceed $1,000,000 at any time outstanding;
 
(j) Guaranty Obligations incurred in the ordinary course of business by the
Parent or any of its Subsidiaries of (i) obligations of any Loan Party or (ii)
any Indebtedness of the Parent or any of its Subsidiaries permitted under this
Section 6.2 (except (x) as regards Indebtedness under clause (c) above, only if
and to the extent such Indebtedness was guaranteed on the Closing Date and (y)
Subordinated Debt under clause (g) above); and
 
(k) Indebtedness relating to Hedge Agreements entered into for non-speculative
purposes.
 
6.3 Limitation on Liens.
 
Create, incur, assume or suffer to exist any Lien upon any of its property,
assets or revenues, including, without limitation, the stock of any Subsidiary,
whether now owned or hereafter acquired, except for (the following,
collectively, “Permitted Liens”):
 
(a) Liens in favor of the Lenders or the Administrative Agent arising under the
Loan Documents;
 
(b) The following, (i) if the validity or amount thereof is being contested in
good faith by appropriate and lawful proceedings diligently conducted so long as
levy and execution thereon have been stayed and continue to be stayed or (ii) if
a final judgment is entered and such judgment is discharged within thirty (30)
days of entry, and in either case they do not materially impair the ability of
the Loan Parties to perform their obligations hereunder or under the other Loan
Documents:
 
(A) Claims or Liens for taxes, assessments or charges due and payable and
subject to interest or penalty, provided that the Loan Parties maintain such
reserves or other appropriate provisions as shall be required by GAAP and pay
all such taxes, assessments or charges forthwith upon the commencement of
proceedings to foreclose any such Lien; and
 
(B) Claims or Liens upon, and defects of title to, real or personal property
including any attachment of personal or real property or other legal process
prior to adjudication of a dispute on the merits.
 
(c) liens for taxes not yet due or which are being contested in compliance with
Section 5.3;
 
(d) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other
like Liens arising in the ordinary course of business;
 

 
78

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

 

(e) pledges or deposits in connection with workers’ compensation, unemployment
insurance and other social security or social welfare legislation;
 
(f) liens of landlords or of mortgagees of landlords arising by operation of law
and deposits to secure the performance of leases in the ordinary course of
business;
 
(g) deposits to secure the performance of bids, trade contracts (other than for
borrowed money), leases, statutory obligations, surety and appeal bonds,
performance bonds and other obligations of a like nature incurred in the
ordinary course of business of the Loan Parties;
 
(h) easements, rights-of-way, restrictions and other similar encumbrances
incurred in the ordinary course of business which, in the aggregate, are not
substantial in amount and which do not interfere with the ordinary conduct of
the business of the Loan Parties;
 
(i) Liens which were in existence on the date hereof and shown on Schedule 6.3
and extensions or replacements thereof;
 
(j) Liens on assets (other than inventory or receivables) of Persons which
become Subsidiaries after the date of this Agreement, provided that such Liens
existed at the time the respective corporations became a Subsidiary and were not
created in anticipation thereof, provided that, (i) any such Lien does not by
its terms cover any property or assets after the time such company becomes a
Subsidiary which were not covered immediately prior thereto (ii) and the
Borrower has complied with Section 5.15 hereof;
 
(k) Capital Leases and purchase money security interests as and to the extent
permitted under this Agreement; and
 
(l) Liens securing reimbursement obligations under any letter of credit
permitted by subsection 6.2(i), provided that such Liens attach solely to the
assets of the Foreign Subsidiary to which such letter of credit relates;
 
6.4 Limitations on Fundamental Changes.
 
Enter into any merger, consolidation or amalgamation, or liquidate, wind up or
dissolve itself (or suffer any liquidation or dissolution), or convey, sell,
lease, assign, transfer or otherwise dispose of, all or substantially all of its
property, business or assets except:
 
(a) a Subsidiary of the Borrower may merge, consolidate or amalgamate into the
Borrower so long as the Borrower is the surviving entity;
 
(b) a Subsidiary of the Borrower may merge, consolidate or amalgamate into or
with any Subsidiary provided that the surviving entity is or becomes a Loan
Party;
 
(c) a Non-Loan Party may merge, consolidate or amalgamate with or into any other
Non-Loan Party;
 
(d) subject to Section 6.16, a Subsidiary of the Borrower may sell, lease,
transfer or otherwise dispose of any or all of its assets (upon voluntary
liquidation or otherwise) to the Borrower or any other Loan Party;
 

 
79

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

 

(e) a Non-Loan Party may liquidate, wind up or dissolve itself or suffer any
liquidation or dissolution;
 
(f) a Non-Loan Party may sell, lease, transfer or otherwise dispose of any or
all of its assets (upon voluntary liquidation or otherwise) to any other
Non-Loan Party; and
 
(g) a merger permitted under Section 6.6;
 
provided that, immediately after each such transaction and after giving effect
thereto, the Borrower is in compliance with this Agreement and no Default or
Event of Default shall be in existence or result from such transaction.
 
6.5 Limitations on Sale of Assets.
 
Convey, sell, lease, assign, transfer or otherwise dispose of any of its
property, business or assets (including, without limitation, accounts
receivables and leasehold interests), whether now owned or hereafter acquired,
except:
 
(a) obsolete or worn out property disposed of in the ordinary course of
business;
 
(b) the sale of inventory or other assets in the ordinary course of business;
 
(c) as permitted by Section 6.4;
 
(d) Permitted Liens;
 
(e) the abandonment of any patent, patent application, trademark, trademark
application service mark or copyright that the Borrower or any Subsidiary
determines, in its commercial reasonable judgment, is no longer necessary or
useful in any material respect in its business; and
 
(f) transfers of assets by any Loan Party to any Non-Loan Party, provided that
such Loan Party receives cash consideration in an amount not less than the fair
market value of such transferred assets.
 
This Section 6.5 shall not prohibit the Borrower or any Subsidiary from
purchasing, holding or acquiring any Investment that is a Permitted Investment.
 
6.6 Limitations on Acquisitions and other Investments.
 
Purchase, hold or acquire beneficially any stock, other securities or evidences
of indebtedness of, or make or permit any Investment (including in any other
Person), except for Permitted Investments; provided that (a) no Permitted
Acquisition shall be completed after the Closing Date unless prior to the 15th
day before such completion (or, with respect to any Permitted Acquisition the
Consideration for which is less than $10,000,000, within 30 days after such
completion) (or, in each case, such other period as the Administrative Agent
may, at the request of the Borrower, agree to in its sole discretion), the
Borrower has provided to the Administrative Agent (i) audited, if available,
and, if not, unaudited annual financial statements of the Person being acquired
(or whose assets are being acquired) for the two (2) fiscal years (or such
lesser period of such Person’s existence), (ii) unaudited financial statements
for any interim fiscal period(s), prior to the consummation of such proposed
acquisition, and (iii) such additional independent third party due diligence
reports and field audits and/or examinations, as the Required Lenders may
request, all in form and substance satisfactory to the Required Lenders;
provided that, the Borrower shall use good faith efforts to obtain three (3)
years of financial statements of the Person being acquired (or whose assets are
being acquired) and (b) each loan from any Subsidiary of the Parent that is not
a Loan Party to any Loan Party shall be evidenced by a promissory note from such
obligor substantially in the form of Exhibit G hereto, pursuant to which such
loan shall be subordinated to the Obligations.  For the sake of clarity, it is
understood and agreed that the above provisions relating to Permitted
Acquisitions shall not apply to the Merger and the Tender Offer, both of which
occurred prior to the Closing Date.
 

 
80

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

 
 
6.7 Limitation on Distributions.
 
At any time make (or incur any liability to make) or pay any Distribution
(whether in cash or property or obligations of the Borrower or any Subsidiary
thereof) in respect of the Parent or any Subsidiary thereof (other than a
Distribution payable to the Borrower or from a Subsidiary of the Borrower to
another Subsidiary of the Borrower); except that, so long as no Default or Event
of Default shall have occurred and be continuing, the Borrower shall be
permitted to pay dividends to the Parent, to pay professional fees, franchise
and income taxes and other ordinary course of business operating
expenses  incurred by the Parent solely in its capacity as parent corporation of
the Borrower and the Subsidiaries thereof.
 
6.8 Transactions with Affiliates.
 
Except as expressly permitted in this Agreement, directly or indirectly enter
into any transaction or arrangement whatsoever or make any payment to or
otherwise deal with any Affiliate other than a Loan Party, except, as to all of
the foregoing pursuant to the reasonable requirements of the Loan Parties’
businesses and upon fair and reasonable terms no less favorable to the Loan
Parties than would be obtained in a comparable arm’s length transaction with a
Person not an Affiliate.
 
6.9 Sale and Leaseback.
 
Enter into any arrangement with any Person providing for the leasing by the
Borrower or any Subsidiary of real or personal property which has been or is to
be sold or transferred by the Borrower or any Subsidiary to such Person or to
any other Person to whom funds have been or are to be advanced by such Person on
the security of such property or rental obligations of the Borrower or such
Subsidiary.
 
6.10 Continuation of or Change in Business.
 
Engage in any business either directly or through any Subsidiary except for
businesses in which the Borrower and its Subsidiaries are engaged in on the date
of this Agreement and any business activities directly related to such existing
businesses.
 
6.11 Limitation on Negative Pledge.
 
Enter into any agreement with any Person other than the Administrative Agent and
the Lenders which prohibits or limits the ability of the Parent or its
Subsidiaries to create, incur, assume or suffer to exist any Lien upon any of
its or their properties, assets or revenues, whether now owned or hereafter
acquired; provided, that, the Borrower or any Subsidiary thereof may enter into
such agreement in connection with any Lien permitted by subsection 6.3(k) or
subsection 6.3(l) of this Agreement, when such prohibition or limitation is by
its terms effective only against the assets subject to such Lien.
 

 
81

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

 

6.12 Limitation on Optional Prepayment of Indebtedness.
 
Make any optional payment or prepayment or redemption, defeasance or purchase of
any Subordinated Debt, earn-outs and any other Indebtedness evidenced by any
seller notes; or amend, modify or change, or consent or agree to any amendment,
modification or change to, any of the terms of any Subordinated Debt or any
seller notes or earn-out arrangements (other than any amendment, modification or
change of a nature which (a) would extend the maturity or reduce the amount of
any payment of principal thereof, (b) would reduce the rate or extend the date
for payment of interest thereon or (c) is not material and, in any event, will
not involve accelerating the date or increasing the amount of any payment or
prepayment).  Notwithstanding anything in this Section 6.12 to the contrary, the
Borrower and its Subsidiaries shall be permitted to set off amounts owed by them
under any seller note against indemnification obligations owed to them by the
payee of such note in accordance with the terms thereof, and such setoff shall
not be deemed an optional payment or prepayment or redemption, defeasance or
purchase of any Indebtedness or earn-out payment under this
Section 6.12.  Promptly following any such set-off, the Borrower shall provide
the Administrative Agent with notice of such set-off setting forth in reasonable
detail the amount of such set-off and the resulting principal amount then
outstanding under such seller note after giving effect to such set-off.
 
6.13 Use of Proceeds.
 
Directly or indirectly apply any part of the proceeds of the Loans to the
purchasing or carrying of any “margin stock” within the meaning of Regulation U
of the Board of Governors of the Federal Reserve System, or any regulations,
interpretations or rulings thereunder.
 
6.14 Fiscal Year.
 
Permit any fiscal year of the Parent to end on a day other than December 31.
 
6.15 Clauses Restricting Subsidiary Distributions.
 
Enter into or suffer to exist or become effective any (a) consensual encumbrance
or restriction or (b) injunction or other order imposing a restriction, on the
ability of any Subsidiary of the Borrower to (i) make Distributions in respect
of any Capital Stock of such Subsidiary held by, or pay any Indebtedness owed
to, the Borrower or any other Subsidiary, (ii) make loans or advances to, or
other Investments in, the Borrower or any other Subsidiary of the Borrower or
(iii) transfer any of its assets to the Borrower or any other Subsidiary of the
Borrower, except for any restrictions existing under the Loan Documents.
 
6.16 Limitation on Activities of the Parent.
 
Permit the Parent to (a) own any property other than Capital Stock of the
Borrower and property ancillary thereto, (b) engage in any business other than
business incidental to its ownership of Capital Stock in the Borrower or (c)
have any liabilities other than  liabilities incurred in the ordinary course of
business and pursuant to the Salary.com Acquisition.
 
6.17 No Misrepresentations or Material Nondisclosure.
 
Furnish the Administrative Agent or any Lender any certificate or other document
that will contain any untrue statement of a material fact or that will omit to
state a material fact necessary in order to make it not misleading in light of
the circumstances under which it was furnished.
 
6.18 Limitation on Assets of Certain Subsidiaries.
 
Permit, at any time (a) Kenexa SA PTE Ltd. (South Africa) and its Subsidiaries
to have assets with a fair market value, in the aggregate, in excess of
$100,000, (b) Salary.com Jamaica Limited and its Subsidiaries to have assets
with a fair market value, in the aggregate, in excess of $1,000, (c) SDC China
Ltd. and its Subsidiaries to have assets with a fair market value, in the
aggregate, in excess of $500,000 and (d) Salary.com Limited and its Subsidiaries
to have assets with a fair market value, in the aggregate, in excess of
$500,000.

 
 
82

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

 
 
SECTION 7.     EVENTS OF DEFAULT
 
7.1 Events of Default.
 
Each of the following shall constitute an event of default (an “Event of
Default”):
 
(a) The Borrower fails to pay on or before the date when due, whether on demand
or otherwise, any principal of the Notes or any Reimbursement Obligation, or
fails to pay within five (5) days after the date when due, any interest thereon
or any other Indebtedness (including fees and expenses) to the Administrative
Agent or the Lenders under this Agreement or the other Loan Documents.
 
(b) The Borrower fails to comply with or perform as and when required or to
observe any of the terms, conditions or covenants contained in Sections 5.1,
5.7, 5.11, 5.15, 5.17 or Section 6 of this Agreement.
 
(c) The Borrower or any other Loan Party fails to comply with or perform as and
when required any of the terms, covenants, or conditions of this Agreement or
any other Loan Document (other than as provided in subsections (a) and (b)
above) to be complied with, performed or observed by the Borrower or such other
Loan Party and such failure shall continue unremedied for a period of 30 days
after the earlier of (i) notice thereof from the Administrative Agent or any
Lender to the Borrower and (ii) any Responsible Officer of the Borrower becoming
aware thereof.
 
(d) Any financial statement or any representation or warranty of the Borrower or
any other Loan Party made herein or in any other Loan Document or in any report,
certificate or other document furnished under or in connection with this
Agreement proves to have been false or misleading in any material respect on or
as of the date made or deemed made.
 
(e) There occurs a default or event of default under (a) any of the other Loan
Documents or any other document or instrument delivered to the Administrative
Agent by the Borrower or any other Loan Party or (b) any Hedge Agreement entered
into with a Lender or Affiliate thereof, and such default or event of default
continues unremedied beyond the grace period, if any, provided therein.
 
(f) The Parent or any Subsidiary thereof shall (i) default in the payment of any
principal of or interest on or any other amount payable on any Indebtedness
beyond the period of grace (not to exceed 30 days), if any, provided in the
instrument or agreement under which such Indebtedness was created and the
aggregate amount of such Indebtedness in respect of which such default or
defaults shall have occurred is at least $500,000; or (ii) default in the
observance or performance of any other agreement or condition relating to any
such Indebtedness in excess of $500,000 contained in any instrument or agreement
evidencing, securing or relating thereto, or any other event shall occur or
condition exist, the effect of which default or other event or condition is to
cause, or to permit the holder or holders of such Indebtedness (or a trustee or
agent on behalf of such holder or holders) to cause, with the giving of notice
if required, such Indebtedness to become due and payable prior to its stated
maturity.
 

 
83

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

 
 
(g) (i) The Parent or any Subsidiary thereof makes an assignment for the benefit
of its creditors or a composition with its creditors, or is unable or admits in
writing its inability to pay its debts as they mature, or files a petition in
bankruptcy, or commences a federal bankruptcy proceeding in which an order for
relief or such other court order or statutory provision which authorizes the
case to proceed is entered against it, or is adjudicated insolvent or bankrupt,
or petitions or applies to any tribunal for the appointment of any custodian,
receiver, liquidator or trustee of or for it or any substantial part of its
properties or assets, or commences any proceeding relating to it under any
bankruptcy, reorganization, arrangement, readjustment of debt, receivership,
dissolution or liquidation law or statute of any jurisdiction, whether now or
hereafter in effect; or there is commenced against the Parent or any Subsidiary
thereof any such proceeding which shall remain undismissed for a period of 60
days, or an order for relief, order, judgment or decree approving the petition
in any such proceeding is entered; (ii) or the Parent or any Subsidiary thereof
by any act or failure to act indicates its consent to, approval of or
acquiescence in any such proceeding or in the appointment of any custodian,
receiver, liquidator or trustee of or for it or any substantial part of its
properties or assets, or suffers any such appointment to continue undischarged
or unstayed for a period of 60 days; (iii) or the Parent or any Subsidiary
thereof takes any action for the purpose of effecting any of the foregoing.
 
(h) One or more judgments or decrees shall be entered against the Parent or any
Subsidiary thereof involving in the aggregate a liability (to the extent not
covered by insurance as to which the insurer does not dispute coverage thereof)
of $500,000 or more and all such judgments or decrees shall not have been
vacated, discharged, settled, satisfied or paid, or stayed or bonded pending
appeal, within 30 days from the entry thereof.
 
(i) Any of the Loan Documents shall cease to be legal, valid and binding
agreements enforceable against a Loan Party executing the same in accordance
with the respective terms thereof or shall in any way be terminated (except in
accordance with its terms) or become or be declared ineffective or inoperative
or shall in any way be challenged and thereby deprive or deny the Lenders and
the Administrative Agent of the intended benefits thereof or they shall thereby
cease substantially to have the rights, titles, interests, remedies, powers or
privileges intended to be created thereby.
 
(j) Any attachment or execution process is issued against 10% or more of the
assets of the Parent or any Subsidiary thereof; or any material uninsured damage
to, or loss, theft or destruction of, any of the collateral subject to the
Security Documents occurs which would reasonably be expected to result in a
Material Adverse Effect.
 

 
84

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

 

(k) The suspension by the Parent or any other Loan Party of all or any
significant part of its business operations or the loss, suspension, revocation
or failure of the Parent or any other Loan Party to renew any license or permit
now held or hereafter acquired by the Parent or any other Loan Party, which
loss, suspension, revocation or failure to file would reasonably be expected to
have a Material Adverse Effect.
 
(l) (A) (i)  Any Employee Pension Plan is terminated within the meaning of Title
IV of ERISA, or (ii) a trustee is appointed by the appropriate United States
District Court to administer any Employee Pension Plan, or (iii) PBGC institutes
proceedings to terminate any Employee Pension Plan or to appoint a trustee to
administer any Employee Pension Plan, or (iv) any Reportable Event occurs which
the Required Lenders determine in good faith indicates a substantial likelihood
that an event described in (i), (ii) or (iii) above will occur, or (v) the
Adjusted Funding Target Attainment Percentage for any Employee Pension Plan is
less than, or is presumed under Section 436 of the Code to be less than, sixty
percent (60%) or (vi) the Parent, any Subsidiary thereof or any Commonly
Controlled Entity incurs any Withdrawal Liability with respect to any
Multiemployer Plan, or (vii) any Multiemployer Plan enters Reorganization, and
(B) with respect to events described in (i)-(iv) above, only if, (1) the benefit
liabilities (within the meaning of Section 4001(a)(16) of ERISA) exceed the
market value of the assets in the fund under the Employee Pension Plan by 5% or
more of the Parent’s, any Subsidiary’s or any Commonly Controlled Entity’s
tangible net worth or (2) the Adjusted Funding Target Attainment Percentage for
the Employee Pension Plan is less than, or is presumed under Section 436 of the
Code to be less than, 80% or (3) there occurs an Accumulated Funding Deficiency
or Unpaid Minimum Required Contribution in excess of $250,000 with respect to
any Employee Pension Plan or (4) there occurs any Accumulated Funding Deficiency
or Unpaid Minimum Required Contribution with respect to any Employee Pension
Plan and the Parent, any Subsidiary thereof or any Commonly Controlled Entity
fails to correct such Accumulated Funding Deficiency or Unpaid Minimum Required
Contribution prior to the end of the correction period within the meaning of
Section 4971(c) of the Code, or (5) there arises a Lien under Section 303(k) of
ERISA or 430(k) of the Code in favor of any Employee Pension Plan.
 
(m) Any Change of Control shall occur.
 
7.2 Remedies.
 
If an Event of Default specified in subsection 7.1(g) with respect to the
Borrower shall occur and be continuing, the Revolving Credit Commitments
(including the Swing Line Sublimit and the obligation of the Issuing Bank to
issue Letters of Credit) shall automatically and immediately terminate, and the
Loans hereunder (with accrued interest thereon) and all other amounts owing
under this Agreement, the Notes and the other Loan Documents shall automatically
and immediately become due and payable (including, without limitation, all
Letter of Credit Obligations, whether or not the beneficiaries of the then
outstanding Letters of Credit shall have presented the documents required
thereunder).  If any other Event of Default shall occur and be continuing, with
the consent of the Required Lenders, the Administrative Agent may, or upon the
written request of the Required Lenders, the Administrative Agent shall (a) by
notice to the Borrower declare the Revolving Credit Commitments (including the
Swing Line Sublimit) to be terminated forthwith, whereupon such Revolving Credit
Commitments and the obligations of the applicable Lenders to make Revolving
Credit Loans and the obligation of the Issuing Bank to issue Letters of Credit,
shall immediately terminate; (b) by notice of default to the Borrower, declare
the Loans hereunder (with accrued interest thereon) and all other amounts owing
under this Agreement, the Notes and the other Loan Documents to be due and
payable forthwith, whereupon the same shall immediately become due and payable
(including, without limitation, all Letter of Credit Obligations, whether or not
the beneficiaries of the then outstanding Letters of Credit shall have presented
the documents required thereunder); (c) exercise such remedies as may be
available to the Administrative Agent and the Lenders hereunder or under the
Security Documents, the other Loan Documents or otherwise at law or equity;
and/or (d) by notice to the Borrower require the Borrower to, and the Borrower
shall thereupon, deposit in a non-interest bearing account with the
Administrative Agent, as cash collateral for its obligations under this
Agreement, the Notes and the Applications, an amount equal to the aggregate
Letter of Credit Coverage Requirement, and the Borrower hereby pledges to the
Administrative Agent and the Lenders, and grants to the Administrative Agent and
the Lenders a security interest in, all such cash as security for such
obligations.  Amounts held in such cash collateral account shall be applied by
the Administrative Agent to the payment of drafts drawn under the Letters of
Credit or, with the consent of the Issuing Bank, to other Obligations, and the
unused portion thereof after all the Letters of Credit shall have expired or
been fully drawn upon, if any, shall be applied to repay the other
Obligations.  After all the Letters of Credit shall have expired or been fully
drawn upon, all Reimbursement Obligations shall have been satisfied and all
other Obligations shall have been paid in full, the balance, if any, in such
cash collateral account shall be returned to the Borrower (or such other Person
or Persons as may be lawfully entitled thereto).  The Borrower shall execute and
deliver to the Administrative Agent, for the account of the Issuing Bank and the
Letter of Credit Participants, such further documents and instruments as the
Administrative Agent may request to evidence the creation and perfection of the
within security interest in such cash collateral account.  Except as expressly
provided above in this Section, presentment, demand, protest and all other
notices of any kind are hereby expressly waived.
 

 
85

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

 
 
SECTION 8.  THE ADMINISTRATIVE AGENT
 
8.1 Appointment.
 
Each Lender hereby irrevocably designates and appoints PNC as administrative
agent of such Lender, in each case under this Agreement and the other Loan
Documents, and each such Lender irrevocably authorizes PNC, in such capacity to
take such action on its behalf under the provisions of this Agreement and the
other Loan Documents and to exercise such powers and perform such duties as are
expressly delegated to the Administrative Agent by the terms of this Agreement
and the other Loan Documents, together with such other powers as are reasonably
incidental thereto.  Notwithstanding any provision to the contrary elsewhere in
this Agreement and the other Loan Documents, the Administrative Agent shall not
have any duties or responsibilities, except those expressly set forth herein or
therein, or any fiduciary relationship with any Lender, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall
be read into this Agreement and the other Loan Documents or otherwise exist
against the Administrative Agent.  PNC agrees to act as the Administrative Agent
on behalf of the Lenders to the extent provided in this Agreement and the other
Loan Documents.
 
8.2 Delegation of Duties.
 
The Administrative Agent may execute any of its duties under this Agreement and
the other Loan Documents by or through agents or attorneys-in-fact and shall be
entitled to engage and pay for the advice and services of counsel concerning all
matters pertaining to such duties.  The Administrative Agent shall not be
responsible to the Lenders for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care.
 

                                 8.3 Exculpatory Provisions.
 
The Lenders hereby agree that neither the Administrative Agent, any other Agent
nor any of their officers, directors, employees, agents, attorneys-in-fact or
Affiliates shall be (a) liable for any action lawfully taken or omitted to be
taken by it or such Person under or in connection with this Agreement or the
other Loan Documents (except for its or such Person’s own gross negligence or
willful misconduct) or (b) responsible in any manner to any of the Lenders for
any recitals, statements, representations or warranties made by the Borrower,
any other party or any officer thereof contained in this Agreement, the other
Loan Documents or in any certificate, report, statement or other document
referred to or provided for in, or received by the Administrative Agent or any
other Agent under or in connection with, this Agreement or the other Loan
Documents or for the value, validity, effectiveness, genuineness, enforceability
or sufficiency of this Agreement, the Notes or the other Loan Documents or for
any failure of the Borrower or any other party to perform its or their
obligations hereunder or thereunder.  The Administrative Agent shall not be
under any obligation to any Lender to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions
of, this Agreement or the other Loan Documents, or to inspect the properties,
books or records of the other parties to the Loan Documents (or any of them).
 
8.4 Reliance by Administrative Agent.
 
The Administrative Agent shall be entitled to rely, and shall be fully protected
in relying, upon any Note, writing, resolution, notice, consent, certificate,
affidavit, letter, cablegram, telegram, telecopy, e-mail, telex or teletype
message, statement, order or other document or conversation (including any
electronic message Internet or intranet website posting or other distribution)
believed by it to be genuine and correct and to have been signed, sent or made
by the proper Person or Persons and upon advice and statements of legal counsel
(including, without limitation, counsel to the Borrower or any other party to a
Loan Document), independent accountants and experts selected by the
Administrative Agent.  The Administrative Agent may deem and treat the payee of
any Note as the owner thereof for all purposes unless a written notice of
assignment, negotiation or transfer thereof shall have been filed with the
Administrative Agent.  The Administrative Agent shall be fully justified in
failing or refusing to take any action under this Agreement or the other Loan
Documents unless it shall first receive such advice or concurrence of the
Required Lenders (or such other percentage of the Lenders as shall be required
hereunder) as it deems appropriate and it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action;
provided that, the Administrative Agent shall not be required to take any action
that, in its opinion or the opinion of its counsel, may expose the
Administrative Agent to liability or that is contrary to any Loan Document or
applicable law.  The Lenders hereby agree that the Administrative Agent shall in
all cases be fully protected in acting, or in refraining from acting, under this
Agreement, the Notes or the other Loan Documents in accordance with a request of
the Required Lenders (or such other percentage of Lenders as shall be required
hereunder), and such request and any action taken or failure to act pursuant
thereto shall be binding upon all the Lenders and all future holders of the
Notes.
 

 
86

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

 

8.5 Notice of Default.
 
The Administrative Agent shall not be deemed to have knowledge or notice of the
occurrence of any Default or Event of Default hereunder unless it has received
notice from a Lender, the Borrower or any other Loan Party referring to this
Agreement, describing such Default or Event of Default and stating that such
notice is a “notice of default”.  In the event that the Administrative Agent
receives such a notice, the Administrative Agent shall promptly give notice
thereof to the Lenders.  The Administrative Agent shall take such action with
respect to such Default or Event of Default as shall be reasonably directed by
the Required Lenders (or such other percentage of the Lenders as shall be
required hereunder); provided that unless and until the Administrative Agent
shall have received such directions, the Administrative Agent may (but shall not
be obligated to) take such action, or refrain from taking such action, with
respect to such Default or Event of Default as it shall deem advisable in the
best interests of the Lenders.
 
8.6 Non-Reliance on Administrative Agent and Other Lenders.
 
Each Lender expressly acknowledges that neither the Administrative Agent, any
other Agent nor any of its or their officers, directors, employees, agents,
attorneys-in-fact or Affiliates has made any representations or warranties to it
and that no act by the Administrative Agent or any other Agent hereinafter
taken, including any review of the affairs of the Borrower and/or any other
party to the Loan Documents, shall be deemed to constitute any representation or
warranty by the Administrative Agent to any Lender.  Each Lender represents to
the Administrative Agent that it has, independently and without reliance upon
the Administrative Agent, any other Agent or any other Lender, and based on such
documents and information as it has deemed appropriate, made its own appraisal
of and investigation into the business, operations, property, financial and
other condition and creditworthiness of the Borrower and the other parties to
the Loan Documents and made its own decision to make its Loans hereunder, issue
and/or participate in Swing Line Loans and Letters of Credit and enter into this
Agreement and each other Loan Document to which it is a party.  Each Lender also
represents that it will, independently and without reliance upon the
Administrative Agent, any other Agent or any other Lender, and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit analysis, appraisals and decisions in taking or not taking
action under this Agreement and the other Loan Documents, and to make such
investigation as it deems necessary to inform itself as to the business,
operations, property, financial and other condition and creditworthiness of the
Borrower and the other Loan Parties.  Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall not have any duty
or responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition (financial or
otherwise), prospects or creditworthiness of the Borrower or any other party to
the Loan Documents which may come into the possession of the Administrative
Agent or its officers, directors, employees, agents, attorneys-in-fact or
Affiliates.
 
8.7 Indemnification.
 
The Lenders agree to indemnify the Administrative Agent and the Lead Arranger in
each of their agent capacities hereunder and under the other Loan Documents (to
the extent not reimbursed by the Borrower and without limiting the obligation,
if any, of the Borrower to do so) ratably in accordance with each Lender’s
respective Total Percentage, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind whatsoever which may at any time
(including, without limitation, at any time following the payment of the Notes)
be imposed on, incurred by or asserted against the Administrative Agent or such
other Agent in any way relating to or arising out of this Agreement, the other
Loan Documents, or any documents contemplated by or referred to herein or
therein or the transactions contemplated hereby or thereby or any action taken
or omitted by the Administrative Agent or such other Agent under or in
connection with any of the foregoing; provided that no Lender shall be liable
for the payment of any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting solely from the Administrative Agent’s or such other Agent’s gross
negligence or willful misconduct.  The agreements in this Section 8.7 shall
survive the payment of the Notes and all other amounts payable hereunder.
 

 
87

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

 
 
8.8 Agents in Their Individual Capacity.
 
Each of the Agents and their Affiliates may make loans to, accept deposits from
and generally engage in any kind of business with the Borrower or any other
party to the Loan Documents as though the Administrative Agent were not an agent
hereunder.  With respect to its Loans made or renewed by the Administrative
Agent and any Notes issued to the Administrative Agent and the Letter of Credit
Obligations, the Administrative Agent shall have the same rights and powers
under this Agreement and the other Loan Documents as any Lender and may exercise
the same as though it were not the administrative agent hereunder and under the
other Loan Documents, and the terms “Lender” and “Lenders” shall include the
Administrative Agent in its individual capacity.
 
8.9 Release of Liens.
 
Upon the sale or other transfer of any assets of the Borrower or any other Loan
Party in compliance with Section 6.5, and so long as it is not aware that any
Default or Event of Default shall exist, the Administrative Agent will take such
action as may be necessary to evidence the release of the Administrative Agent’s
Lien on such assets, including delivering to the Borrower or such other Loan
Party, at the cost of the Borrower, appropriate collateral releases.
 
8.10 Successor Administrative Agent.
 
The Administrative Agent may resign as administrative agent hereunder and under
the other Loan Documents upon 30 days’ notice to the Lenders and the
Borrower.  If the Administrative Agent shall resign, then the Required Lenders
shall appoint from among the Lenders a successor administrative agent for the
Lenders, which appointment shall be subject to (unless a Default or Event of
Default shall exist) the approval of the Borrower (which approval shall not be
unreasonably withheld or delayed).  If no successor shall have been so appointed
by the Required Lenders and shall have accepted such appointment within 30 days
after the retiring Administrative Agent gives notice of its resignation, then
the retiring Administrative Agent may, on behalf of the Lenders and the Issuing
Bank, appoint a successor Administrative Agent; provided that if Administrative
Agent shall notify the Borrower and the Lenders that no Person has accepted such
appointment, then such resignation shall nonetheless become effective in
accordance with such notice and (a) the retiring Administrative Agent shall be
discharged from its duties and obligations hereunder and under the other Loan
Documents (except that in the case of any collateral security held by the
Administrative Agent on behalf of the Lenders or the Issuing Bank under any of
the Loan Documents, the retiring Administrative Agent shall continue to hold
such collateral security until such time as a successor Administrative Agent is
appointed) and (b) all payments, communications and determinations provided to
be made by, to or through the Administrative Agent shall instead be made by or
to each Lender and Issuing Bank directly, until such time as Required Lenders
appoint a successor Administrative Agent as provided for above in this
Section.  Upon the acceptance of a successor’s appointment as Administrative
Agent hereunder, such successor administrative agent shall succeed to the
rights, powers and duties of the Administrative Agent and the term
“Administrative Agent” shall mean such successor administrative agent effective
upon its appointment and the former Administrative Agent’s rights, powers and
duties shall be terminated, without any other or further act or deed on the part
of such former Administrative Agent or any of the other parties to this
Agreement or the other Loan Documents or any holders of the Notes.  After any
retiring Administrative Agent’s resignation, the provisions of this Article 8
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was an Administrative Agent under this Agreement and the other Loan
Documents.  If the Lead Arranger shall resign, it shall not be replaced.
 

 
88

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

 
           
                                8.11 USA Patriot Act.
 
Each Lender or assignee or participant of a Lender that is not incorporated
under the Laws of the United States of America or a state thereof (and is not
excepted from the certification requirement contained in Section 313 of the USA
Patriot Act and the applicable regulations because it is both (a) an Affiliate
of a depository institution or foreign bank that maintains a physical presence
in the United States or foreign country, and (b) subject to supervision by a
banking authority regulating such affiliated depository institution or foreign
bank) shall deliver to the Administrative Agent the certification, or, if
applicable, recertification, certifying that such Lender is not a “shell” and
certifying to other matters as required by Section 313 of the USA Patriot Act
and the applicable regulations:  (i) within 10 days after the Closing Date, and
(ii) at such other times as are required under the USA Patriot Act.
 
8.12 Beneficiaries.
 
Except as expressly provided herein, the provisions of this Section 8 are solely
for the benefit of the Agents and the Lenders, and the Borrower and the other
Loan Parties shall not have any right to rely on or enforce any of the
provisions hereof.  In performing its functions and duties under this Agreement
and the other Loan Documents, the Administrative Agent shall act solely as
administrative agent of the Lenders and does not assume and shall not be deemed
to have assumed any obligation toward or relationship of agency or trust with or
for the Borrower or any of the other Loan Parties.
 
8.13 Lead Arranger.
 
The Lead Arranger, in its capacity as Lead Arranger, shall have no duties or
responsibilities under this Agreement or any other Loan Document.
 
 
 
 

 
89

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

 
SECTION 9.    MISCELLANEOUS
 
9.1 Amendments and Waivers
 
                                 (a) Subject to the remaining provisions of this
Section 9.1, the Required Lenders, or the Administrative Agent with the consent
of the Required Lenders, and the Borrower (or, in the case of the other Loan
Documents, the relevant parties thereto) may from time to time enter into
amendments, extensions, supplements and replacements to and of this Agreement
and the other Loan Documents to which they are parties, and the Required Lenders
may from time to time waive compliance with a provision of any of the Loan
Documents.  Subject to the remaining provisions of this Section 9.1, no
amendment, extension, supplement, replacement or waiver shall be effective
unless it is in writing and is signed by the Required Lenders or the
Administrative Agent with the consent of the Required Lenders, and the Borrower
(or, in the case of the other Loan Documents, the relevant parties
thereto).  Each waiver shall be effective only for the specific instance and for
the specific purpose for which it is given.

 
                                 (b) The foregoing notwithstanding, no such
amendment, extension, supplement, replacement or waiver shall, directly or
indirectly, without the consent of all the Lenders:
 
(i) change the Revolving Credit Commitments (except as expressly provided in
Section 2.10) or the principal amount of the Loans which may be outstanding
hereunder;
 
(ii) reduce any interest rate hereunder (other than to waive the Default Rate)
or any of the fees due hereunder or under any of the other Loan Documents (other
than fees to the Administrative Agent, which shall require the consent of the
Borrower and the Administrative Agent to change);
 
(iii) postpone any scheduled payment date of principal, interest or fees
hereunder or under any of the other Loan Documents (excluding mandatory
principal prepayment of the Loans);
 
(iv) release all or substantially all of the Lenders’ security interest in the
Collateral securing the Obligations;
 
(v) change the definition of “Required Lenders”;
 
(vi) release or discharge, or consent to any release or discharge of (A) the
Borrower as borrower under the Loan Documents or (B) a Guarantor as guarantor
(other than in connection with a sale of such Guarantor in a transaction
permitted hereunder); or permit the Borrower or any Affiliate to assign to
another Person any of its obligations under the Loan Documents;
 
(vii) amend this Section 9.1; or
 
(viii) change Section 2.16 in a manner that would alter the pro rata sharing
provisions required thereby.
 
(c) The foregoing notwithstanding, no such amendment, extension, supplement, or
replacement shall amend, modify or otherwise affect the rights or duties of the
Administrative Agent, the Swing Line Lender or the Issuing Bank hereunder or
under any other Loan Document without the prior written consent of the
Administrative Agent, the Swing Line Lender or the Issuing Bank, as the case may
be.
 
(d) Any waiver or amendment, supplement or modification permitted hereunder
shall apply equally to each of the Lenders and shall be binding upon the
Borrower, the Lenders, the Administrative Agent and all future holders of the
Notes.  In the case of any waiver, the Borrower, the Lenders and the
Administrative Agent shall be restored to their former position and rights
hereunder and under the other Loan Documents, and any Default or Event of
Default waived shall be deemed to be cured and not continuing; but no such
waiver shall extend to any subsequent or other Default or Event of Default, or
impair any right consequent thereon.
 

 
90

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

 
                                 9.2 Notices.
 
(a) Except in the case of notices and other communications expressly permitted
to be given by telephone (and except as provided in clause (b) below), all
notices, requests and demands to or upon the respective parties hereto to be
effective shall be in writing, and, unless otherwise expressly provided herein,
shall be deemed to have been duly given or made when delivered by hand, or three
days after being deposited in the mail, postage prepaid, or the next Business
Day if sent by reputable overnight courier, postage prepaid, for delivery on the
next Business Day, or, in the case of telecopy notice, when received during
normal business hours addressed as follows in the case of the Borrower, PNC, the
Administrative Agent and the Issuing Bank, and, in the case of any other Lender,
to its address set forth in its administrative questionnaire, or to such other
address as may be hereafter notified by the respective parties hereto and any
future holders of the Notes:
 
If to the Borrower:
Kenexa Technology, Inc.
650 East Swedesford Road
Wayne, PA  19087
Attention:  Don Volk, Chief Financial Officer
Telecopy:  (610) 971-2576
and
Attention:  Cynthia Pyle Dixon, Esq.
Telecopy:  (610) 971-2576
     
with a copy to:
     
Pepper Hamilton LLP
3000 Logan Square
18th and Arch Streets
Philadelphia, PA  19103
Attention:  Barry M. Abelson, Esq.
Telecopy:  (215) 981-4750
   
provided that failure to send a copy of such notice to Pepper Hamilton LLP shall
in no way affect, limit or invalidate any notice sent to the Borrower or the
exercise of any of the Administrative Agent’s, the Swing Line Lender’s, the
Issuing Bank’s or the Lenders’ rights or remedies pursuant to a notice sent to
the Borrower;
 
If to PNC, the Administrative Agent, Swing Line Lender or the Issuing Bank:
PNC Bank, National Association
1000 Westlakes Drive, Suite 200
Berwyn, PA  19312
Attention:  Daniel C. Takoushian
Telecopy:  (610) 725-5799
     
and
     
PNC Bank, National Association
Agency Services
PNC Firstside Center
500 First Avenue, 4th Floor
Pittsburgh, PA  15219
Attention:  Lisa Pierce
Telecopy:  (412) 762-8672
   

provided (i) any notice, request or demand to or upon the Administrative Agent,
the Issuing Bank or the Lenders pursuant to Sections 2.3, 2.4, 2.5, 2.10 and
2.11 shall not be effective until received and (ii) any notice of a Default or
Event of Default hereunder shall be sent by telecopy or reputable overnight
courier.
 
 
91

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

 
 
(a) Notices and other communications to the Lenders and the Issuing Bank
hereunder may be delivered or furnished by electronic communication (including
e-mail and Internet or intranet websites) pursuant to procedures approved by the
Administrative Agent; provided that the foregoing shall not apply to notices to
any Lender or the Issuing Bank if such Lender or the Issuing Bank, as
applicable, has notified the Administrative Agent that it is incapable of
receiving notices under such Article by electronic communication.  The
Administrative Agent or the Borrower may, in its discretion, agree to accept
notices and other communications to it hereunder by electronic communications
pursuant to procedures approved by it; provided that approval of such procedures
may be limited to particular notices or communications.  Unless the
Administrative Agent otherwise prescribes, (i) notices and other communications
sent to an e-mail address shall be deemed received upon the sender’s receipt of
an acknowledgement from the intended recipient (such as by the “return receipt
requested” function, as available, return e-mail or other written
acknowledgement); provided that if such notice or other communication is not
sent during the normal business hours of the recipient, such notice or
communication shall be deemed to have been sent at the opening of business on
the next Business Day for the recipient, and (ii) notices or communications
posted to an Internet or intranet website shall be deemed received upon the
deemed receipt by the intended recipient at its e-mail address as described in
the foregoing clause (i) of notification that such notice or communication is
available and identifying the website address therefor.
 
9.3 No Waiver; Cumulative Remedies.
 
No failure to exercise and no delay in exercising, on the part of the
Administrative Agent, the Issuing Bank or any Lender, any right, remedy, power
or privilege hereunder shall operate as a waiver thereof; nor shall any single
or partial exercise of any right, remedy, power or privilege hereunder preclude
any other or further exercise thereof or the exercise of any other right,
remedy, power or privilege.  The rights, remedies, powers and privileges herein
provided are cumulative and not exclusive of any rights, remedies, powers and
privileges provided by law.
 
9.4 Survival of Representations and Warranties.
 
All representations and warranties made hereunder and in any document,
certificate or statement delivered pursuant hereto or in connection herewith
shall survive the execution and delivery of this Agreement, the Notes and the
other Loan Documents.
 

 
92

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

 

9.5 Payment of Expenses and Taxes.
 
The Borrower agrees (a) to pay or reimburse the Administrative Agent for all of
its reasonable out-of-pocket costs and expenses incurred in connection with the
development, preparation and execution of, and the syndication and
administration of, this Agreement, the Notes, the other Loan Documents and any
other documents executed and delivered in connection herewith or therewith, and
the consummation of the transactions contemplated hereby and thereby, including,
without limitation, the reasonable fees and disbursements of counsel, (b) to pay
or reimburse the Administrative Agent for all of its reasonable out-of-pocket
costs and expenses incurred in connection with the performance of or any
amendment, supplement or modification or proposed amendment, supplement or
modification to this Agreement, the Notes and the other Loan Documents and any
other documents executed and delivered in connection therewith, including
without limitation, the reasonable fees and disbursements of counsel, (c) pay or
reimburse each Lender and each Agent for all its reasonable costs and expenses
incurred in connection with the enforcement, preservation or protection of any
rights under this Agreement, the Notes, the other Loan Documents and any such
other documents, including its rights under this Section, or in connection with
the Loans made or Letters of Credit issued hereunder (including all such
out-of-pocket expenses incurred during any actual or attempted workout,
restructuring or negotiations in respect of such Loans) including, without
limitation, reasonable fees and disbursements of counsel, (d) to pay, indemnify,
and hold each Lender, the Swing Line Lender, the Issuing Bank, each Agent and
each of their respective Affiliates and the partners, directors, officers,
employees, agents and advisors of such Persons and of such Person’s Affiliates
(collectively, the “Indemnified Parties”) harmless from, any and all recording
and filing fees and any and all liabilities with respect to, or resulting from
any delay in paying, stamp, excise and other similar taxes, if any, which may be
payable or determined to be payable in connection with the execution and
delivery of, or consummation of any of the transactions contemplated by, or any
amendment, supplement or modification of, or any waiver or consent under or in
respect of, this Agreement, the Notes, the other Loan Documents and any such
other documents, and (e) to pay, indemnify, and hold each Indemnified Party
harmless from and against any and all other liabilities, obligations, losses,
damages, penalties, actions (whether sounding in contract, in tort or on any
other ground), judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever with respect to the execution, delivery, enforcement,
performance and administration of or in any other way arising out of or relating
to, this Agreement, the Notes, the other Loan Documents, or any such other
documents contemplated by or referred to herein or therein or any action taken
by any Lender or any Agent with respect to the foregoing (all the foregoing,
collectively, the “indemnified liabilities”), provided, that the Borrower shall
have no obligation hereunder to any Indemnified Party with respect to
indemnified liabilities arising from the gross negligence or willful misconduct
of such Indemnified Party.  To the fullest extent permitted by applicable law,
the Borrower shall not assert, and the Borrower hereby waives, any claim against
any indemnified person, on any theory of liability, for special, indirect,
consequential or punitive damages (as opposed to direct or actual damages)
arising out of, in connection with, or as a result of, this Agreement, any other
Loan Document or any agreement or instrument contemplated hereby, the
transactions contemplated hereby or thereby, any Loan or Letter of Credit or the
use of the proceeds thereof.  No Indemnified Party shall be liable for any
damages arising from the use by unintended recipients of any information or
other materials distributed by it through telecommunications, electronic or
other information transmission systems in connection with this Agreement or the
other Loan Documents or the transactions contemplated hereby or thereby.
 

 
93

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

 

The agreements in this subsection shall survive repayment of the Notes and all
other amounts payable hereunder.
 
9.6 Successors and Assigns.
 
                                 (a) Whenever in this Agreement any of the
parties hereto is referred to, such reference shall be deemed to include the
successors and permitted assigns of such party; and all covenants, promises and
agreements by or on behalf of the Borrower, the Administrative Agent or the
Lenders that are contained in this Agreement shall bind and inure to the benefit
of its respective successors and assigns.  The Borrower may not assign or
transfer any of its rights or obligations under this Agreement or the other Loan
Documents without the prior written consent of each Lender.
 
(b) Each Lender may, in accordance with applicable law, sell to any Lender or
Affiliate thereof and, with the consent of the Borrower (except when any Event
of Default exists or if the sale is to a Lender or an Affiliate of a Lender),
the Administrative Agent and (with respect to an assignment of Revolving Credit
Loans or Revolving Credit Commitments) the Issuing Bank (which consents shall
not be unreasonably withheld or delayed and provided that the Borrower shall be
deemed to have consented if it does not object to the assignment within five (5)
Business Days after having received notice thereof), to one or more other banks
or financial institutions (each, a “Purchasing Lender”) all or a part of its
interests, rights and obligations under this Agreement, the Notes and the other
Loan Documents (including all or a portion of its Revolving Credit Commitment
and the Loans at the time owing to it and the Notes held by it); provided,
however, that (i) so long as no Event of Default shall exist and be continuing,
such assignment shall be in an amount not less than $2,000,000 (or such lesser
amount as the Borrower (unless an Event of Default shall exist) and the
Administrative Agent shall agree in their sole discretion), unless the sum of
such assigning Lender’s Total Exposure plus Unused Revolving Credit Commitment
is less than $2,000,000 in which case such assigning Lender may transfer all,
but not less than all, of its interests hereunder and (ii) the parties to each
such assignment shall execute and deliver to the Administrative Agent and the
Borrower for its acceptance (to the extent required) and recording in the
Register an Assignment and Assumption, together with the Note(s) subject to such
assignment and, except for assignments by a Lender to one of its Affiliates, a
processing and recordation fee of $3,500 and (iii) the Swing Line Sublimit and
all outstanding Swing Line Loans may only be assigned in their entirety by a
Lender then having a Revolving Credit Commitment.  Upon acceptance and recording
pursuant to paragraph (e) of this Section 9.6, from and after the effective date
specified in the applicable Assignment and Assumption, which effective date
shall be at least five Business Days after the receipt thereof by the
Administrative Agent and the Borrower (unless otherwise agreed by the
Administrative Agent), (A) such Purchasing Lender shall be a party hereto and,
to the extent of the interest assigned by such Assignment and Assumption, have
the rights and obligations of a Lender under this Agreement and (B) the
assigning Lender thereunder shall, to the extent of the interest assigned by
such Assignment and Assumption, be released from its obligations under this
Agreement (and, in the case of an Assignment and Assumption covering all or the
remaining portion of an assigning Lender’s rights and obligations under this
Agreement and the other Loan Documents, such Lender shall cease to be a party
hereto but shall continue to be entitled to the benefits of subsections 2.12,
2.13, 2.14, 5.14(c) and 9.5 (to the extent that such Lender’s entitlement to
such benefits arose out of such Lender’s position as a Lender prior to the
applicable assignment).  Such Assignment and Assumption shall be deemed to amend
this Agreement to the extent, and only to the extent, necessary to reflect the
addition of such Purchasing Lender and the resulting amounts and percentages
held by the Lenders arising from the purchase by such Purchasing Lender of all
or a portion of the rights and obligations of such assigning Lender under this
Agreement, the Notes and the other Loan Documents.
 

 
94

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

 
 
(c) By executing and delivering an Assignment and Assumption, the assigning
Lender thereunder and the Purchasing Lender thereunder shall be deemed to
confirm to and agree with each other and the other parties hereto as
follows:  (i) such assigning Lender warrants that it is the legal and beneficial
owner of the interest being assigned thereby, free and clear of any adverse
claim and that its commitment, and the outstanding balances of its Loans,
without giving effect to assignments thereof which have not become effective,
are as set forth in such Assignment and Assumption, (ii) except as set forth in
(i) above, such assigning Lender makes no representation or warranty and assumes
no responsibility with respect to any statements, warranties or representations
made in or in connection with this Agreement or the other Loan Documents, or the
execution, legality, validity, enforceability, genuineness, sufficiency or value
of this Agreement, the other Loan Documents or any other instrument or document
furnished pursuant hereto or thereto, or the financial condition of the
Borrower, the Parent, any other party, or any Subsidiary thereof or the
performance or observance by the Borrower, any other Loan Party or any other
party of any of its obligations under this Agreement or the other Loan Documents
or any other instrument or document furnished pursuant hereto or thereto; (iii)
such Purchasing Lender represents and warrants that it is legally authorized to
enter into such Assignment and Assumption; (iv) such Purchasing Lender confirms
that it has received a copy of this Agreement, together with copies of the most
recent financial statements delivered pursuant to Section 5.1 and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment and Assumption; (v) such
Purchasing Lender will independently and without reliance upon the
Administrative Agent, such assigning Lender or any other Lender and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement and the other Loan Documents; (vi) such Purchasing Lender
appoints and authorizes the Administrative Agent to take such action as
administrative agent on its behalf and to exercise such powers under this
Agreement and the other Loan Documents as are delegated to the Administrative
Agent by the terms hereof or thereof, together with such powers as are
reasonably incidental thereto; and (vii) such Purchasing Lender agrees that it
will perform in accordance with their terms all the obligations which by the
terms of this Agreement and the other Loan Documents are required to be
performed by it as a Lender including, if it is organized under the laws of a
jurisdiction outside the United States, its obligation pursuant to Section 2.14
to deliver the forms prescribed by the Internal Revenue Service of the United
States certifying as to the Purchasing Lender’s exemption from United States
withholding taxes with respect to all payments to be made to the Purchasing
Lender under this Agreement.
 
(d) The Administrative Agent shall maintain at its offices a copy of each
Assignment and Assumption and the names and addresses of the Lenders, and the
commitments of, and principal amount of the Loans owing to, each Lender pursuant
to the terms hereof from time to time (the “Register”).  The entries in the
Register shall be conclusive in the absence of manifest error and the Borrower,
the Administrative Agent and the Lenders may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Agreement.  The Register shall be available for inspection
by the Borrower and any Lender at any reasonable time and from time to time upon
reasonable prior notice.
 

 
95

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

 
 
(e) Upon its receipt of a duly completed Assignment and Assumption executed by
an assigning Lender and a Purchasing Lender (and in the case of a Purchasing
Lender that is not then a Lender or an Affiliate thereof, by the Borrower
(unless an Event of Default shall then exist) and the Administrative Agent)
together with the Note or Notes subject to such assignment and the processing
and recordation fee referred to in paragraph (b) above, the Administrative Agent
shall promptly (i) accept such Assignment and Assumption, (ii) record the
information contained therein in the Register and (iii) give notice thereof to
the Lenders.  Within five Business Days after receipt of notice, the Borrower,
at its own expense, shall execute and deliver to the Administrative Agent, in
exchange for the surrender of the original Note or Notes (A) a new Revolving
Credit Note, Term Note and/or Swing Line Note, to the order of such Purchasing
Lender in the appropriate amounts assumed and (B) if the assigning Lender has
retained an interest hereunder, the applicable Note or Notes in the appropriate
amount(s).  Such new Note(s) shall be dated the date of the surrendered Note(s)
which such new Note(s) replace and shall otherwise be in substantially the form
of Exhibit A-1, A-2 and A-3, respectively.  Canceled Notes shall be returned to
the Borrower.
 
(f) As provided in subsection 2.10(c) hereof, a New Lender shall, at least five
(5) Business Days (or such shorter periods as shall be agreed to by the
Administrative Agent in its sole discretion) before the proposed effective date
of such Proposed New Lender’s joinder hereto (or such shorter period as shall be
agreed to by the Administrative Agent), complete, execute and deliver to the
Administrative Agent a New Lender Joinder.  Such New Lender Joinder shall
include, among other things, a joinder to this Agreement and otherwise be in
form and substance acceptable to the Administrative Agent and the
Borrower.  Upon the effective date of such joinder and the obtaining of the
Administrative Agent’s and the Swing Line Lender’s consent, such Proposed New
Lender shall become a party hereto (hereinafter referred to as a “New Lender”)
and shall be one of the Lenders hereunder for all purposes.  Simultaneously with
the execution and delivery of a New Lender Joinder or an Increased Commitment
and Acceptance, the Borrower shall execute and deliver new Revolving Credit
Notes for such New Lender and/or existing Lender.
 
(g) Each Lender may, in accordance with applicable law,  sell participations to
any Lender or Affiliate thereof and to one or more banks or other Persons (each
a “Participant”), in each case in any Loan owing to such Lender, any Note held
by such Lender, any commitment of such Lender, or any other interest of such
Lender hereunder and under the other Loan Documents, provided, however, that
(i) such Lender’s obligations under this Agreement to the other parties to this
Agreement shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations,
(iii) such Lender shall remain the holder of any such Note for all purposes
under this Agreement and the other Loan Documents, (iv) the Borrower, the
Lenders and the Administrative Agent shall continue to deal solely and directly
with such Lender in connection with such Lender’s rights and obligations under
this Agreement and the other Loan Documents, (v) in any proceeding under the
Bankruptcy Code, such Lender shall be, to the extent permitted by law, the sole
representative with respect to the obligations held in the name of such Lender,
whether for its own account or for the account of any Participant and (vi) such
Lender shall retain the sole right to approve, without the consent of any
Participant, any amendment, modification or waiver of any provision of this
Agreement or the Notes held by such Lender or any other Loan Document, other
than with respect to the matters described in clauses (i) through (viii) of
subsection 9.1(b).
 

 
96

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

 
 
(h) If amounts outstanding under this Agreement and the Notes are due or unpaid,
or shall have been declared or shall have become due and payable upon the
occurrence of an Event of Default, each Participant shall be deemed to have the
right of set-off in respect of its participating interest in amounts owing under
this Agreement and any Note to the same extent as if the amount of its
participating interest were owing directly to it as a Lender under this
Agreement or any Note, provided that in purchasing such participation such
Participant shall be deemed to have agreed to share with the Lenders the
proceeds thereof as provided in Section 9.7  The Borrower also agrees that each
Participant shall be entitled to the benefits of subsections 2.12, 2.13, 2.14,
5.14(c) and 9.5 with respect to its participation in the commitments and the
Loans outstanding from time to time; provided, that no Participant shall be
entitled to receive any greater amount pursuant to such subsections than the
assigning Lender would have been entitled to receive in respect of the amount of
the participation transferred by such assigning Lender to such Participant had
no such transfer occurred.
 
(i) If any Participant of a Lender is organized under the laws of any
jurisdiction other than the United States or any state thereof, the assigning
Lender, concurrently with the sale of a participating interest to such
Participant, shall cause such Participant (i) to represent to the assigning
Lender (for the benefit of the assigning Lender and the other Lenders), the
Administrative Agent and the Borrower that under applicable law and treaties no
taxes will be required to be withheld by the Administrative Agent, the Borrower
or the assigning Lender with respect to any payments to be made to such
Participant in respect of its participation in the Loans and Letters of Credit
in amounts in excess of any amounts required to be withheld from payments to
such assigning Lender and (ii) to agree (for the benefit of the assigning
Lender, the other Lenders, the Administrative Agent and the Borrower) that it
will deliver the tax forms and other documents required to be delivered pursuant
to subsection 2.14(b) and comply from time to time with all applicable U.S. laws
and regulations with respect to withholding tax exemptions.
 
(j) Notwithstanding any other provision contained in this Agreement or any other
Loan Document to the contrary, any Lender may, without obtaining any consents
from any of the parties hereto, at any time (i) assign all or any portion of the
Loans or Notes held by it to any Federal Reserve Bank or the United States
Treasury as collateral security pursuant to Regulation A of the Board of
Governors of the Federal Reserve System and any Operating Circular issued by
such Federal Reserve Bank and (ii) in the case of a Lender that is or owns,
controls or serves as originator for a fund, trust or similar entity, assign or
pledge all or any portion of the Loans or Notes held by it to a trustee under
any indenture to which such Lender is a party or to the lenders to such Lender
for collateral security purposes, provided that any payment in respect of such
assigned Loans or Notes made by the Borrower to or for the account of the
assigning or pledging Lender in accordance with the terms of this Agreement
shall satisfy the Borrower’s obligations hereunder in respect to such assigned
Loans or Notes to the extent of such payment.  No such assignment shall release
the assigning Lender from its obligations hereunder.
 

 
97

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

 

9.7 Adjustments; Set-off.
 
                                 (a)  Except as otherwise expressly provided
herein, if any Lender (a “benefited Lender”) shall at any time receive any
payment of all or part of its Loans or the Reimbursement Obligations owing to
it, or interest thereon, or receive any collateral in respect thereof (whether
voluntarily or involuntarily, by set-off, pursuant to events or proceedings of
the nature referred to in subsection 7.1(g), or otherwise), in a greater
proportion than any such payment to or collateral received by any other Lender,
if any, in respect of such other Lender’s Loans or the Reimbursement Obligations
owing to it, or interest thereon, such benefited Lender shall purchase for cash
from the other Lenders such portion of each such other Lender’s Loans or the
Reimbursement Obligations owing to it, or shall provide such other Lenders with
the benefits of any such collateral, or the proceeds thereof, as shall be
necessary to cause such benefited Lender to share the excess payment or benefits
of such collateral or proceeds ratably with each of the Lenders; provided,
however, that if all or any portion of such excess payment or benefits is
thereafter recovered from such benefited Lender, such purchase shall be
rescinded, and the purchase price and benefits returned, to the extent of such
recovery, but without interest.  The Borrower agrees that each Lender so
purchasing a portion of another Lender’s Loans may exercise all rights of
payment (including, without limitation, rights of set-off) with respect to such
portion as fully as if such Lender were the direct holder of such portion.
 
(b) In addition to any rights and remedies of the Lenders provided by law, upon
the occurrence and during the continuance of an Event of Default, each Lender
shall have the right, without prior notice to the Borrower, any such notice
being expressly waived by the Borrower to the extent permitted by applicable
law, upon any amount becoming due and payable by the Borrower hereunder or under
the Notes or the other Loan Document (whether at the stated maturity, by
acceleration or otherwise) to set-off and appropriate and apply against such
amount any and all deposits (general or special, time or demand, provisional or
final), in any currency, and any other credits, indebtedness or claims, in any
currency, in each case whether direct or indirect, absolute or contingent,
matured or unmatured, at any time held or owing by such Lender to or for the
credit or the account of the Borrower.  Each Lender agrees promptly to notify
the Borrower and the Administrative Agent after any such set-off and application
made by such Lender, provided that the failure to give such notice shall not
affect the validity of such set-off and application.
 
9.8 Counterparts.
 
This Agreement may be executed by one or more of the parties to this Agreement
on any number of separate counterparts, and all of said counterparts taken
together shall be deemed to constitute one and the same instrument.  A set of
the copies of this Agreement signed by all the parties shall be lodged with the
Borrower and the Administrative Agent.
 
9.9 Severability.
 
Any provision of this Agreement which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
 

 
98

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

 

9.10 Integration.
 
This Agreement and the other Loan Documents represent the agreement of the
parties hereto with respect to the subject matter hereof, and there are no
promises, undertakings, representations or warranties by the Administrative
Agent or any Lender relative to the subject matter hereof not expressly set
forth or referred to herein or in the other Loan Documents.
 
9.11 GOVERNING LAW.
 
THIS AGREEMENT AND THE NOTES, AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
UNDER THIS AGREEMENT AND THE NOTES, SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE COMMONWEALTH OF PENNSYLVANIA.
 
9.12 Confidentiality.
 
Each of the Lenders severally agrees that it will use reasonable precautions to
keep confidential, in accordance with its customary procedures for handling
confidential information of the same nature any non-public information supplied
to it by the Borrower or any other Loan Party pursuant to the Loan Documents;
provided that nothing herein shall prevent any Lender from disclosing any such
information (a) to the Administrative Agent, any other Lender or any Proposed
New Lender (or prospective Proposed New Lender), (b) to any prospective or
actual assignee or participant in connection with any assignment or
participation (or proposed assignment or participation) of Loans or commitments
permitted by this Agreement so long as such assignee or participant is notified
as to the confidential nature of such information and agrees to keep such
information confidential, (c) to its employees, directors, agents, attorneys,
accountants and other professional advisors, rating agencies, and funding
sources, (d) upon the request or demand of any Governmental Authority having
jurisdiction over such Lender, (e) in response to any order of any court or
other Governmental Authority or as may otherwise be required pursuant to any
Requirement of Law, (f) which has been publicly disclosed other than in breach
of this Agreement, (g) in connection with the exercise of any remedy hereunder
or under the Notes or other Loan Documents or (h) to its Affiliates and to its
and its Affiliates’ respective partners, directors, officers, employees, agents,
advisors and other representatives (it being understood that the Persons to whom
such disclosure is made will be informed of the confidential nature of such
information and instructed to keep such information confidential).
 
9.13 Submission To Jurisdiction; Waivers.
 
The Borrower hereby irrevocably and unconditionally:
 
(a) submits for itself and its property in any legal action or proceeding
relating to this Agreement, the Notes or the other Loan Documents, or for
recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the courts of the Commonwealth of
Pennsylvania, the courts of the United States of America for the Eastern
District of Pennsylvania, and appellate courts from any thereof;
 
(b) consents that any such action or proceeding may be brought in such courts
and waives any objection that it may now or hereafter have to the venue of any
such action or proceeding in any such court or that such action or proceeding
was brought in an inconvenient court and agrees not to plead or claim the same;
 

 
99

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

 

(c) waives and hereby acknowledges that it is estopped from raising any
objection based on forum non conveniens, any claim that any of the
above-referenced courts lack proper venue or any objection that any of such
courts lack personal jurisdiction over it so as to prohibit such courts from
adjudicating any issues raised in a complaint filed with such courts against the
Borrower concerning this Agreement or the other Loan Documents;
 
(d) acknowledges and agrees that the choice of forum contained in this Section
9.13 shall not be deemed to preclude the enforcement of any judgment obtained in
any forum or the taking of any action under the Loan Documents to enforce the
same in any appropriate jurisdiction;
 
(e) agrees that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to the Borrower at its
address set forth in Section 9.2 or at such other address of which the
Administrative Agent shall have been notified pursuant thereto;
 
(f) agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to sue in
any other jurisdiction; and
 
(g) without limiting the provisions of Section 9.5 hereof, waives, to the
maximum extent not prohibited by law, any right it may have to claim or recover
in any legal action or proceeding referred to in this subsection any special,
exemplary or punitive or consequential damages.
 
9.14 Acknowledgments.
 
The Borrower hereby acknowledges that:
 
(a) it has been advised by counsel in the negotiation, execution and delivery of
this Agreement, the Notes and the other Loan Documents;
 
(b) neither the Administrative Agent nor any Lender has any fiduciary
relationship to the Borrower or any other party to the Loan Documents (or any of
them) and the relationship hereunder between the Administrative Agent and
Lenders, on the one hand, and the Borrower and its Affiliates parties to the
Loan Documents, on the other hand, is solely that of debtor and creditor; and
 
(c) no joint venture exists among the Borrower and its Affiliates parties to the
Loan Documents (or any of them) and the Lenders or the Agents.
 
9.15 USA PATRIOT ACT.
 
Each Lender that is subject to the requirements of the USA Patriot Act hereby
notifies the Borrower and the other Loan Parties that pursuant to the
requirements of the USA Patriot Act, it is required to obtain, verify and record
information that identifies the Borrower and such other Loan Parties, which
information includes the name and address of the Borrower and such other Loan
Parties and other information that will allow such Lender to identify the
Borrower and such other Loan Parties in accordance with the USA Patriot Act.
 
                                 9.16 WAIVERS OF JURY TRIAL.
 
THE BORROWER, THE ADMINISTRATIVE AGENT AND EACH LENDER HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING
TO THIS AGREEMENT, THE NOTES OR ANY OTHER LOAN DOCUMENT AND FOR ANY MANDATORY
COUNTERCLAIM THEREIN.
 

 
[Signature Pages to Follow]
 

 
100

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

 

                 IN WITNESS WHEREOF, the parties hereto, by their officers
thereunto duly authorized, have executed this Agreement as of the day and year
first above written.
 

KENEXA TECHNOLOGY, INC.

By: /s/ Donald F.
Volk                                                              
Name:  Donald F. Volk
Title:  Chief Financial Officer

PNC BANK, NATIONAL ASSOCIATION, as Administrative Agent, Issuing Bank and a
Lender

By: /s/ Daniel
Takoushian                                                              
Name: Daniel Takoushian
Title: Senior Vice President

 
101

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

 

FIRST NIAGARA BANK, N.A., as a Lender

By: /s/ Carl Goelz                                                      
Name: Carl Goelz
Title: First Vice President

 
102

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

 

JPMORGAN CHASE BANK, N.A., as a Lender

By: /s/ Anna
Biancardi                                                                
Name: Anna Biancardi
Title: Vice President Credit Executive

 
103

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

 

TD BANK, N.A., as a Lender

By: /s/ Thomas M.
McGrory                                                                
Name: Thomas M. McGrory
Title: Vice President

 
104

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

 

TRISTATE CAPITAL BANK, as a Lender

By: /s/ Timothy A. Merriman 
Name: Timothy A. Merriman
Title: Senior Vice President

 
105

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

 

Schedule I
 
Lenders and Commitments
 
 
Lenders and Notice
Information
Revolving Credit
Commitment
 
Swing Line Sublimit*
Term Loan Commitment
Total Commitment
         
PNC Bank, National Association
$11,666,666.66
$2,500,000
$8,333,333.34
$20,000,000.00
 First Niagara Bank, N.A.  $6,416,666.67    $4,583,333.33   $11,000,000.00
 JPMorgan Chase Bank, N.A.  $6,416,666.67    $4,583,333.33   $11,000,000.00  TD
Bank, N.A.  $6,416,666.67    $4,583,333.33   $11,000,000.00  TriState Capital
Bank  $4,083,333.33    $2,916,666.67   $7,000,000.00  Total $35,000,000 
 $2,500,000 $25,000,000  $60,000,000 

                         *  The Swing Line is a sublimit of the Revolving Credit
Commitment.

 

 
106

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

 

Schedule II
 
Existing Letters of Credit
 
                                                 None.
 

 
107

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

 

Schedule III
 
Existing Permitted Investments
 
See Attached.

 
108

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

 

Schedule 2.1(b)
 
Term Loan Amortization Schedule *
 

 
 
Payment Date
 
Total Loan
Payment Amount
         
January 1, 2011
  $ 1,250,000  
April 1, 2011
  $ 1,250,000  
July 1, 2011
  $ 1,250,000  
October 1, 2011
  $ 1,250,000  
January 1, 2012
  $ 1,250,000  
April 1, 2012
  $ 1,250,000  
July 1, 2012
  $ 1,250,000  
October 1, 2012
  $ 1,250,000  
January 1, 2013
  $ 1,250,000  
April 1, 2013
  $ 1,250,000  
July 1, 2013
  $ 1,250,000  
October 1, 2013
  $ 1,250,000  
Term Loan Maturity Date
  $ 10,000,000