Exhibit 10.1

FINANCING AGREEMENT

Financing Agreement, dated as of July 3, 2007, by and among METALICO, INC., a
Delaware corporation (the “Borrower”), each subsidiary of the Borrower listed as
a “Guarantor” on the signature pages hereto (each a “Guarantor” and
collectively, jointly and severally, the “Guarantors”), the lenders from time to
time party hereto (each a “Lender” and collectively, the “Lenders”), ABLECO
FINANCE LLC, a Delaware limited liability company (“Ableco”), as collateral
agent for the Lenders (in such capacity, together with any successor collateral
agent, the “Collateral Agent”), and Ableco, as administrative agent for the
Lenders (in such capacity, together with any successor administrative agent,
the “Administrative Agent” and together with the Collateral Agent, each an
“Agent” and collectively, the “Agents”).

RECITALS

The Borrower has asked the Lenders to extend a credit facility of $50,000,000
(the “Maximum Credit Facility Amount”) to the Borrower consisting of (a) a term
loan in the aggregate principal amount of $32,000,000, and (b) a term loan in an
aggregate principal amount of $18,000,000. The proceeds of the term loans shall
be used to pay a portion of the cash Purchase Price for the Acquisitions (as
defined below) by the Borrower and its Subsidiaries, for general working capital
purposes of the Borrower and its Subsidiaries, and to pay fees and expenses
related to this Agreement. The Lenders are severally, and not jointly, willing
to extend such credit to the Borrower subject to the terms and conditions
hereinafter set forth.

In consideration of the premises and the covenants and agreements contained
herein, the parties hereto agree as follows:

ARTICLE I

DEFINITIONS; CERTAIN TERMS

Section 1.01 Definitions. As used in this Agreement, the following terms shall
have the respective meanings indicated below, such meanings to be applicable
equally to both the singular and plural forms of such terms:

“Ableco” has the meaning specified therefor in the preamble hereto.

“Account Debtor” means any Person who is or who may become obligated under, with
respect to, or on account of, an Account Receivable, chattel paper, or a general
intangible.

“Account Receivable” means, with respect to any Person, all of such Person’s now
owned or hereafter acquired right, title, and interest with respect to
“accounts” (as that term is defined in Article 9 of the Code), and any and all
“supporting obligations” (as that term is defined in the Code) in respect
thereof.

“Acquisitions” means, collectively, the Annaco Acquisition and the Totalcat
Acquistion.

“Action” has the meaning specified therefor in Section 12.12.

“additional amount” has the meaning specified therefor in Section 2.08(a)

“Administrative Agent” has the meaning specified therefor in the preamble
hereto.

“Administrative Agent’s Account” means an account at a bank designated by the
Administrative Agent from time to time as the account into which the Borrower
shall make all payments to the Administrative Agent for the benefit of the
Agents and the Lenders under this Agreement and the other Loan Documents.

“Affiliate” means, with respect to any Person, any other Person that directly,
or indirectly through one or more intermediaries, controls, is controlled by, or
is under common control with, such Person. For purposes of this definition,
“control” of a Person means the power, directly or indirectly, either to
(i) vote 10% or more of the Capital Stock having ordinary voting power for the
election of directors of such Person or (ii) direct or cause the direction of
the management and policies of such Person whether by contract or otherwise.
Notwithstanding anything herein to the contrary, in no event shall any Agent or
any Lender be considered an “Affiliate” of any Loan Party.

“After Acquired Property” means any interest in real property acquired by the
Borrower or any of its Subsidiaries after the date hereof with a Current Value
in excess of $500,000 in the case of a fee interest or requiring the payment of
annual rent exceeding in the aggregate $50,000 in the case of a leasehold
interest.

“Agent” and “Agents” have the respective meanings specified therefor in the
preamble hereto.

“Agreement” means this Financing Agreement, including all amendments,
modifications and supplements and any exhibits or schedules to any of the
foregoing, and shall refer to the Agreement as the same may be in effect at the
time such reference becomes operative.

“Annaco” means, individually and collectively, Annaco, Inc., an Ohio
corporation, 943 Hazel LLC, an Ohio limited liability company, and Ocanna Plant
II LLC, an Ohio limited liability company.

“Annaco Acquisition” means the acquisition by Metalico Akron of substantially
all of the assets of Annaco, Inc., an Ohio corporation, and the acquisition by
Metalico Akron Realty of all of the Capital Stock of Elizabeth Hazel LLC, an
Ohio limited liability company, a wholly-owned Subsidiary of 943 Hazel LLC, an
Ohio limited liability company, and Melinda Hazel LLC, an Ohio limited liability
company, a wholly-owned Subsidiary of Ocanna Plant II LLC, an Ohio limited
liability company, all in accordance with the terms of the Annaco Acquisition
Agreement.

“Annaco Acquisition Agreement” means that certain Agreement for Purchase of
Assets, dated as of June 29, 2007, by and among Annaco, Metalico Akron and
Metalico Akron Realty.

“Annaco Acquisition Documents” means, collectively, the Annaco Acquisition
Agreement and all other instruments and agreements executed and delivered in
connection therewith.

“Annaco Earn-Out Arrangements” means the Borrower’s obligations to make payments
in connection with the Annaco Acquisition based on the performance of the entity
acquired (or allocated to the assets acquired) in connection therewith and so
long as such obligations are unsecured.

“Assignment and Acceptance” means an assignment and acceptance entered into by
an assigning Lender and an assignee, and accepted by the Collateral Agent, in
accordance with Section 12.07 hereof and substantially in the form of
Exhibit A-1 hereto or such other form acceptable to the Collateral Agent.

“Authorized Officer” means, with respect to any Person, the chief executive
officer, chief financial officer, president, executive vice president, or senior
vice president of such Person.

“Availability” has the meaning ascribed thereto in the Foothill Loan Agreement
as in effect on the Effective Date.

“Bankruptcy Code” means the United States Bankruptcy Code (11 U.S.C. § 101, et
seq.), as amended, and any successor statute.

“Base LIBOR Rate” means the greater of (a) 4.5 percent per annum, and (b) the
rate per annum, determined by Administrative Agent in accordance with its
customary procedures, and utilizing such electronic or other quotation sources
as are customarily utilized by lenders in loan transactions of this type, on the
basis of the rates at which Dollar deposits are offered to major banks in the
London interbank market on or about 11:00 a.m. (New York time) 2 Business Days
prior to the commencement of the applicable Interest Period, for a term and in
amounts comparable to the Interest Period and amount of the LIBOR Rate Loan
requested by the Borrower in accordance with this Agreement, which determination
shall be conclusive in the absence of manifest error.

“Beacon” means Beacon Energy Corp. (formerly known as AgriFuel Co.), a Delaware
corporation.

“Beacon Investment” means an investment or series of investments, after the
Effective Date, in the common Capital Stock of Beacon for cash consideration not
exceeding in the aggregate $2,000,000.

“Board” means the Board of Governors of the Federal Reserve System of the United
States.

"Board of Directors” means the board of directors (or comparable managers) of
Borrower or any committee thereof duly authorized to act on behalf thereof.

“Borrower” has the meaning specified therefor in the preamble hereto.

“Business Day” means any day that is not a Saturday, Sunday, or other day on
which banks are authorized or required to close in the State of New York, except
that, if a determination of a Business Day shall relate to a LIBOR Rate Loan,
the term “Business Day” also shall exclude any day on which banks are closed for
dealings in U.S. Dollar deposits in the London interbank market.

“Capital Expenditures” means, with respect to any Person for any period, the sum
of (i) the aggregate of all expenditures by such Person and its Subsidiaries
during such period that in accordance with GAAP are or should be included in
“property, plant and equipment” or in a similar fixed asset account on its
balance sheet, whether such expenditures are paid in cash or financed and
including all Capitalized Lease Obligations paid or payable during such period,
and (ii) to the extent not covered by clause (i) above, (A) the aggregate of all
expenditures by such Person and its Subsidiaries during such period to acquire
by purchase or otherwise the business or fixed assets of, or the Capital Stock
of, any other Person, and (B) the aggregate of all capitalized software costs.

“Capitalized Lease” means, with respect to any Person, any lease of real or
personal property by such Person as lessee which is (i) required under GAAP to
be capitalized on the balance sheet of such Person or (ii) a transaction of a
type commonly known as a “synthetic lease” (i.e. a lease transaction that is
treated as an operating lease for accounting purposes but with respect to which
payments of rent are intended to be treated as payments of principal and
interest on a loan for Federal income tax purposes).

“Capitalized Lease Obligations” means, with respect to any Person, obligations
of such Person and its Subsidiaries under Capitalized Leases, and, for purposes
hereof, the amount of any such obligation shall be the capitalized amount
thereof determined in accordance with GAAP.

“Capital Stock” means (i) with respect to any Person that is a corporation, any
and all shares, interests, participations or other equivalents (however
designated and whether or not voting) of corporate stock, and (ii) with respect
to any Person that is not a corporation, any and all partnership, membership or
other equity interests of such Person.

“Carry-Over Amount” has the meaning specified therefor in Section 7.03(e).

“Cash and Cash Equivalents” means all cash, deposit or securities account
balances, certificates of deposit or other financial instruments properly
classified as cash or cash equivalents under GAAP.

“CFC” means a controlled foreign corporation (as that term is defined in the
IRC).

"Change in Law” has the meaning specified therefor in Section 4.05(a).

“Change of Control” means each occurrence of any of the following:

(a) any “person” or “group” (within the meaning of Sections 13(d) and 14(d) of
the Exchange Act) becomes the beneficial owner (as defined in Rule 13d-3 under
the Exchange Act), directly or indirectly, of 25%, or more, of the Capital Stock
of the Borrower having the right to vote for the election of members of the
Board of Directors,

(b) a majority of the members of the Board of Directors do not constitute
Continuing Directors,

(c) (i) the Borrower ceases to directly own and control 100% of the outstanding
Capital Stock of each of its Subsidiaries (other than Beacon) extant as of the
Effective Date, unless otherwise permitted hereunder, or (ii) the Borrower
ceases to own and control at least 50% of the outstanding Capital Stock of
Beacon, unless otherwise permitted hereunder, or (iii) from and after the Term
Loan B Funding Date, the Borrower ceases to directly or indirectly own and
control at least 82.5% of the outstanding Capital Stock of Totalcat and its
Subsidiaries (such percentage to be increased to the extent that the Borrower
acquires any additional Capital Stock of Totalcat after the Term Loan B Funding
Date), unless otherwise permitted hereunder,

(d) (i) the Borrower consolidates with or merges into another entity or conveys,
transfers or leases all or substantially all of its property and assets to any
Person, or (ii) any entity consolidates with or merges into the Borrower, which
in either event (i) or (ii) is pursuant to a transaction in which the
outstanding voting Capital Stock of the Borrower is reclassified or changed into
or exchanged for cash, securities or other property, or

(e) the occurrence of a “Change of Control” (as that term is defined in the
Foothill Loan Agreement).

“Code” means the New York Uniform Commercial Code, as in effect from time to
time; provided, however, that in the event that, by reason of mandatory
provisions of law, any or all of the attachment, perfection, priority, or
remedies with respect to Collateral Agent’s Liens on any Collateral is governed
by the Uniform Commercial Code as enacted and in effect in a jurisdiction other
than the State of New York, the term “Code” shall mean the Uniform Commercial
Code as enacted and in effect in such other jurisdiction solely for purposes of
the provisions thereof relating to such attachment, perfection, priority, or
remedies.

“Collateral” means all of the property and assets and all interests therein and
proceeds thereof now owned or hereafter acquired by any Person upon which a Lien
is granted or purported to be granted by such Person as security for all or any
part of the Obligations.

“Collateral Agent” has the meaning specified therefor in the preamble hereto.

“Collateral Agent Advances” has the meaning specified therefor in Section
10.08(a).

“Collection Account” and “Collection Accounts” have the meanings specified
therefor in Section 8.01(a).

“Commitments” means, with respect to each Lender, such Lender’s Term Loan A
Commitment and Term Loan B Commitment.

“Compass/150 Lee Notes” means, collectively, (i) that certain promissory note,
dated April 30, 2007, by Metalico Transfer in favor of Compass Environmental
Haulers, Inc., in the original principal amount of $455,000, and (ii) that
certain promissory note, dated April 30, 2007, by Metalico Transfer Realty in
favor of 150 Lee, LLC, in the original principal amount of $500,000.

“Compass Non-Compete Agreement” means that certain Non-Competition Agreement
dated April 30, 2007, by and between Metalico Transfer and Gary D’Amico.

“Compass Subordination Agreement, means a subordination agreement, in form and
substance reasonably satisfactory to the Collateral Agent, by and among the
Collateral Agent, Foothill, the holders of the Compass/150 Lee Notes and Gary
D’Amico.

“Consolidated EBITDA” means, with respect to any Person for any period, the
Consolidated Net Income of such Person and its Subsidiaries for such period,
plus (i) without duplication, the sum of the following amounts of such Person
and its Subsidiaries for such period and to the extent deducted in determining
Consolidated Net Income of such Person and its Subsidiaries for such period:
(A) Consolidated Net Interest Expense, (B) net income tax expense,
(C) depreciation expense, (D) amortization expense, (E) non-cash compensation
charges, (F) non-cash expenses relating to the Borrower’s ownership of the
Capital Stock of Beacon, and (G) to the extent actually paid during such period,
fees and expenses related to the consummation of the transactions contemplated
to be closed on the Effective Date under this Agreement and the transactions
contemplated by the Annaco Acquisition Agreement, minus non-cash gains relating
to the Borrower’s ownership of the Capital Stock of Beacon; provided that
Consolidated EBITDA of the Borrower and its Subsidiaries for each fiscal month
during the period from July 1, 2006 to June 30, 2007 shall be as mutually agreed
to by the Borrower and the Agent.

“Consolidated Funded Indebtedness” means, with respect to any Person at any
date, all Indebtedness for borrowed money or letters of credit of such Person,
determined on a consolidated basis in accordance with GAAP, which by its terms
matures more than one year after the date of calculation, and any such
Indebtedness maturing within one year from such date which is renewable or
extendable at the option of such Person to a date more than one year from such
date, including, in any event, but without duplication, with respect to the
Borrower and its Subsidiaries, the Term Loan A, the Term Loan B, and the amount
of their Capitalized Lease Obligations.

“Consolidated Net Income” means, with respect to any Person for any period, the
net income (loss) of such Person and its Subsidiaries for such period,
determined on a consolidated basis and in accordance with GAAP, but excluding
from the determination of Consolidated Net Income (without duplication) (a) any
non-cash extraordinary or non-recurring gains or losses or non-cash gains or
losses from Dispositions, (b) restructuring charges, (c) effects of discontinued
operations, (d) interest that is paid-in-kind, (e) interest income, and (f) any
tax refunds, net operating losses or other net tax benefits received during such
period on account of any prior period.

“Consolidated Net Interest Expense” means, with respect to any Person for any
period, gross cash interest expense of such Person and its Subsidiaries for such
period determined on a consolidated basis and in accordance with GAAP (including
interest expense paid to Affiliates of such Person), less (i) the sum of
(A) interest income for such period and (B) gains for such period on Hedging
Agreements (to the extent not included in interest income above and to the
extent not deducted in the calculation of gross interest expense), plus (ii) the
sum of (A) losses for such period on Hedging Agreements (to the extent not
included in such gross interest expense) and (B) the upfront costs or fees for
such period associated with Hedging Agreements (to the extent not included in
such gross interest expense), in each case, determined on a consolidated basis
and in accordance with GAAP.

“Contingent Obligation” means, with respect to any Person, any obligation of
such Person guaranteeing or intended to guarantee any Indebtedness, leases,
dividends or other obligations (“primary obligations”) of any other Person
(the “primary obligor”) in any manner, whether directly or indirectly, including
(i) the direct or indirect guaranty, endorsement (other than for collection or
deposit in the ordinary course of business), co-making, discounting with
recourse or sale with recourse by such Person of the obligation of a primary
obligor, (ii) the obligation to make take-or-pay or similar payments, if
required, regardless of nonperformance by any other party or parties to an
agreement, (iii) any obligation of such Person, whether or not contingent,
(A) to purchase any such primary obligation or any property constituting direct
or indirect security therefor, (B) to advance or supply funds (1) for the
purchase or payment of any such primary obligation or (2) to maintain working
capital or equity capital of the primary obligor or otherwise to maintain the
net worth or solvency of the primary obligor, (C) to purchase property, assets,
securities or services primarily for the purpose of assuring the owner of any
such primary obligation of the ability of the primary obligor to make payment of
such primary obligation or (D) otherwise to assure or hold harmless the holder
of such primary obligation against loss in respect thereof; provided, however,
that the term “Contingent Obligation” shall not include any product warranties
extended in the ordinary course of business. The amount of any Contingent
Obligation shall be deemed to be an amount equal to the stated or determinable
amount of the primary obligation with respect to which such Contingent
Obligation is made (or, if less, the maximum amount of such primary obligation
for which such Person may be liable pursuant to the terms of the instrument
evidencing such Contingent Obligation) or, if not stated or determinable, the
maximum reasonably anticipated liability with respect thereto (assuming such
Person is required to perform thereunder), as determined by such Person in good
faith.

“Continuing Director” means (a) any member of the Board of Directors who was a
director (or comparable manager) of the Borrower on the Effective Date, and
(b) any individual who becomes a member of the Board of Directors after the
Effective Date if such individual was appointed or nominated for election to the
Board of Directors by a majority of the Continuing Directors, but excluding any
such individual originally proposed for election in opposition to the Board of
Directors in office at the Effective Date in an actual or threatened election
contest relating to the election of the directors (or comparable managers) of
the Borrower (as such terms are used in Rule 14a-11 under the Exchange Act) and
whose initial assumption of office resulted from such contest or the settlement
thereof.

“Current Value” has the meaning specified therefor in Section 7.01(o).

“Default” means an event which, with the giving of notice or the lapse of time
or both, would constitute an Event of Default.

“Disposition” means any transaction, or series of related transactions, pursuant
to which any Person or any of its Subsidiaries sells, assigns, transfers or
otherwise disposes of any property or assets (whether now owned or hereafter
acquired) to any other Person, in each case, whether or not the consideration
therefor consists of cash, securities or other assets owned by the acquiring
Person.

“Dollar,” “Dollars” and the symbol “$” each means lawful money of the United
States of America.

“Domestic Subsidiary” means any Subsidiary of any Person that is not a CFC.

“Effective Date” means the date, on or after July 3, 2007, on which all of the
conditions precedent set forth in Section 5.01 are first satisfied or waived.

“Employee Plan” means an employee benefit plan (other than a Multiemployer Plan)
covered by Title IV of ERISA and maintained (or that was maintained at any time
during the six (6) calendar years preceding the date of any borrowing hereunder)
for employees of any Loan Party or any of its ERISA Affiliates.

“Environmental Actions” means any complaint, summons, citation, notice,
directive, order, claim, litigation, investigation, judicial or administrative
proceeding, judgment, letter or other communication from any Governmental
Authority involving violations of Environmental Laws or Releases of Hazardous
Materials (i) from any assets, properties or businesses of any Loan Party or any
of its Subsidiaries or acquired from any predecessor in interest; (ii) from
adjoining properties or businesses; or (iii) onto any facilities which received
Hazardous Materials generated by any Loan Party or any of its Subsidiaries or
generated by any predecessor in interest from which any Loan Party or any of its
Subsidiaries acquired any such facility.

“Environmental Laws” means the Comprehensive Environmental Response,
Compensation and Liability Act (42 U.S.C. § 9601, et seq.), the Hazardous
Materials Transportation Act (49 U.S.C. § 1801, et seq.), the Resource
Conservation and Recovery Act (42 U.S.C. § 6901, et seq.), the Federal Clean
Water Act (33 U.S.C. § 1251 et seq.), the Clean Air Act (42 U.S.C. § 7401 et
seq.), the Toxic Substances Control Act (15 U.S.C. § 2601 et seq.) and the
Occupational Safety and Health Act (29 U.S.C. § 651 et seq.), as such laws may
be amended or otherwise modified from time to time, and any other present or
future federal, state, local or foreign statute, ordinance, rule, regulation,
order, judgment, decree, permit, license or other binding determination of any
Governmental Authority imposing liability or establishing standards of conduct
for protection of the environment or other government restrictions relating to
the protection of the environment or the release, emission, deposit, discharge,
leaching, migration or spill of any Hazardous Materials into the environment.

“Environmental Liabilities and Costs” means all liabilities, monetary
obligations, Remedial Actions, losses, damages, punitive damages, consequential
damages, treble damages, costs and expenses (including all reasonable fees,
disbursements and expenses of counsel, experts and consultants and costs of
investigations and feasibility studies), fines, penalties, sanctions and
interest incurred as a result of any claim or demand by any Governmental
Authority or any third party, and which relate to the liability or potential
liability of any Loan Party with respect to any environmental condition or a
Release of Hazardous Materials from or onto (i) any property currently or
formerly owned by any Loan Party or any of its Subsidiaries or (ii) any Real
Property which received Hazardous Materials generated by any Loan Party or any
of its Subsidiaries.

“Environmental Lien” means any Lien in favor of any Governmental Authority for
Environmental Liabilities and Costs.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended,
and any successor statute of similar import, and regulations thereunder, in each
case, as in effect from time to time. References to sections of ERISA shall be
construed also to refer to any successor sections.

“ERISA Affiliate” means, with respect to any Person, any trade or business
(whether or not incorporated) which is a member of a group of which such Person
is a member and which would be deemed to be a “controlled group” within the
meaning of Sections 414(b), (c), (m) and (o) of the IRC.

“Event of Default” means any of the events set forth in Section 9.01.

“Excess Amount” has the meaning specified therefor in Section 7.03(e).

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Extraordinary Receipts” means any cash or other payments received by the
Borrower or any of its Subsidiaries not in the ordinary course of business (and
not consisting of proceeds of Dispositions or Indebtedness), including
(i) foreign, United States, state or local tax refunds, (ii) pension plan
reversions, (iii) proceeds of insurance, (iv) judgments, proceeds of settlements
or other consideration of any kind in connection with any cause of action,
(v) condemnation awards (and payments in lieu thereof), (vi) indemnity payments
and (vii) any purchase price adjustment received in connection with any purchase
agreement and any amounts received from escrow arrangements in connection with
any purchase agreement; provided, however, that “Extraordinary Receipts” shall
not include amounts received by Gulf Coast Recycling, Inc. in the nature of
contribution, indemnification, or reimbursement in respect of environmental
remediation costs and liabilities expended in relation to Florida sites on or
prior to the Effective Date, so long as each of the following are satisfied at
the time of the receipt of such amounts: (a) no Event of Default has occurred
and is continuing, (b) the Qualified Issuance has occurred, (c) such amounts are
received within three (3) years of the Effective Date, and (d) an amount, to be
mutually agreed upon by Collateral Agent, Foothill, and the Borrower as a
reasonable estimation of the liability of Borrower and its Subsidiaries for
future environmental remediation costs at such site, has been deposited in a
deposit account that is subject to a perfected security interest in favor of
Foothill and the Collateral Agent.

“Facility” means each of the parcels of real property identified on Schedule F-1
attached hereto, including all buildings and other improvements thereon, all
fixtures located at or used in connection with such facility, all whether now or
hereafter existing.

“Federal Funds Rate” means, for any period, a fluctuating interest rate per
annum equal to, for each day during such period, the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day which is a Business Day, the average of the
quotations for such day on such transactions received by the Administrative
Agent from three Federal funds brokers of recognized standing selected by it.

“Filing Authorization Letter” means a letter duly executed by each Loan Party
authorizing the Collateral Agent to file financing statements in such office or
offices as may be necessary or, in the opinion of the Collateral Agent,
desirable to perfect the security interests purported to be created by each
Security Agreement.

“Final Maturity Date” means June 30, 2013, or such earlier date on which all or
any portion of the Obligations shall become due and payable pursuant to the
terms of Section 9.01.

“Financial Statements” means (i) the audited consolidated balance sheet of the
Borrower and its Subsidiaries for the Fiscal Year ended December 31, 2006, and
the related consolidated statement of operations, shareholders’ equity and cash
flows for the Fiscal Year then ended, and (ii) the unaudited consolidated
balance sheet of the Borrower and its Subsidiaries for the 3 months ended
March 31, 2007, and the related consolidated statement of operations,
shareholder’s equity and cash flows for the 3 months then ended.

“Fiscal Year” means the fiscal year of the Borrower and its Subsidiaries ending
on December 31st of each year.

“Fixed Charge Coverage Ratio” means, with respect to any Person for any period,
the ratio of (i) the Consolidated EBITDA of such Person and its Subsidiaries for
such period, minus Capital Expenditures (exclusive of financed Capital
Expenditures) made by such Person and its Subsidiaries during such period, to
(ii) the sum of (A) all principal of Indebtedness of such Person and its
Subsidiaries scheduled to be paid or prepaid during such period, plus
(B) Consolidated Net Interest Expense (exclusive of the amortization of fees
associated with the consummation of the financing under this Agreement and the
Foothill Agreement) of such Person and its Subsidiaries for such period, plus
(C) all income tax liabilities of such Person and its Subsidiaries that accrued
during such period, to the extent that the amount of such liabilities is greater
than zero, plus (D) cash dividends or distributions paid by such Person and its
Subsidiaries (other than, in the case of the Borrower, dividends or
distributions paid to the Borrower or its wholly-owned Subsidiaries) during such
period. In determining the Fixed Charge Coverage Ratio for a particular period,
the calculation of the income tax liabilities of such Person and its
Subsidiaries described in clause (ii)(C) of the immediately preceding sentence
shall be made without giving effect to any tax refunds, tax receivables, net
operating losses or other net tax benefits that were received or receivable
during such period on account of any prior periods.

“Foothill” means Wells Fargo Foothill, Inc., a California corporation.

“Foothill Indebtedness” means Indebtedness of the Loan Parties owing under the
Foothill Loan Agreement.

“Foothill Loan Agreement” means that certain Amended and Restated Loan and
Security Agreement, dated as of July 3, 2007, between Borrower, the Guarantors,
and Foothill, as the same is amended or modified from time to time.

“Frank Non-Competition Agreement” means that certain Non-Competition Agreement,
dated as of November 18, 2004, by and between Metalico Rochester and Robert
Frank.

“Funding Losses” has the meaning specified therefor in Section 2.04(d)(ii)(B).

“GAAP” means generally accepted accounting principles in effect from time to
time in the United States, applied on a consistent basis, provided that for the
purpose of Section 7.03 hereof and the definitions used therein, “GAAP” shall
mean generally accepted accounting principles in effect on the date hereof and
consistent with those used in the preparation of the Financial Statements,
provided, further, that if there occurs after the date of this Agreement any
change in GAAP that affects in any respect the calculation of any covenant
contained in Section 7.03 hereof, the Collateral Agent and the Borrower shall
negotiate in good faith amendments to the provisions of this Agreement that
relate to the calculation of such covenant with the intent of having the
respective positions of the Lenders and the Borrower after such change in GAAP
conform as nearly as possible to their respective positions as of the date of
this Agreement and, until any such amendments have been agreed upon, the
covenants in Section 7.03 hereof shall be calculated as if no such change in
GAAP has occurred.

“Governmental Authority” means any nation or government, any Federal, state,
city, town, municipality, county, local or other political subdivision thereof
or thereto and any department, commission, board, bureau, instrumentality,
agency or other entity exercising executive, legislative, judicial, taxing,
regulatory or administrative powers or functions of or pertaining to government.

“Guaranteed Obligations” has the meaning specified therefor in Section 11.01.

“Guarantor” and “Guarantors” (i) have the meanings specified therefor in the
preamble to this Agreement, and (ii) include each other Person which guarantees,
pursuant to Section 7.01(b) or otherwise, all or any part of the Obligations.

“Guaranty” means (i) the guaranty of each Guarantor party hereto contained in
Article XI hereof, and (ii) each other guaranty made by any other Guarantor in
favor of the Collateral Agent for the benefit of the Agents and the Lenders
pursuant to the requirements of Section 7.01(b) or otherwise.

“Hazardous Materials” means (a) any element, compound or chemical that is
defined, listed or otherwise classified as a contaminant, pollutant, toxic
pollutant, toxic or hazardous substance, extremely hazardous substance or
chemical, hazardous waste, special waste, or solid waste under Environmental
Laws or that is likely to cause immediately, or at some future time, harm to or
have an adverse effect on, the environment or risk to human health or safety,
including any pollutant, contaminant, waste, hazardous waste, toxic substance or
dangerous good which is defined or identified in any Environmental Law and which
is present in the environment in such quantity or state that it contravenes any
Environmental Law; (b) petroleum and its refined products; (c) polychlorinated
biphenyls; (d) any substance exhibiting a hazardous waste characteristic,
including corrosivity, ignitability, toxicity or reactivity as well as any
radioactive or explosive materials; and (e) any raw materials, building
components (including asbestos-containing materials) and manufactured products
containing hazardous substances listed or classified as such under Environmental
Laws.

“Hedging Agreement” means any interest rate, foreign currency, commodity or
equity swap, collar, cap, floor or forward rate agreement, or other agreement or
arrangement designed to protect against fluctuations in interest rates or
currency, commodity or equity values (including any option with respect to any
of the foregoing and any combination of the foregoing agreements or
arrangements), and any confirmation executed in connection with any such
agreement or arrangement.

“Highest Lawful Rate” means, with respect to any Agent or any Lender, the
maximum non-usurious interest rate, if any, that at any time or from time to
time may be contracted for, taken, reserved, charged or received on the
Obligations under laws applicable to such Agent or such Lender which are
currently in effect or, to the extent allowed by law, under such applicable laws
which may hereafter be in effect and which allow a higher maximum non-usurious
interest rate than applicable laws now allow.

“HSR” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976 as in
effect as of the Effective Date.

“Indebtedness” means, with respect to any Person, without duplication, (i) all
indebtedness of such Person for borrowed money; (ii) all obligations of such
Person for the deferred purchase price of property or services (other than trade
payables or other accounts payable incurred in the ordinary course of such
Person’s business and not outstanding for more than 90 days after the date such
payable was created); (iii) all obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments or upon which interest payments
are customarily made; (iv) all reimbursement, payment or other obligations and
liabilities of such Person created or arising under any conditional sales or
other title retention agreement with respect to property used or acquired by
such Person, even though the rights and remedies of the lessor, seller or lender
thereunder may be limited to repossession or sale of such property; (v) all
Capitalized Lease Obligations of such Person; (vi) all obligations and
liabilities, contingent or otherwise, of such Person, in respect of letters of
credit, acceptances and similar facilities; (vii) all obligations and
liabilities, calculated on a basis satisfactory to the Collateral Agent and in
accordance with accepted practice, of such Person under Hedging Agreements;
(viii) all Contingent Obligations; (ix) liabilities incurred under Title IV of
ERISA with respect to any plan (other than a Multiemployer Plan) covered by
Title IV of ERISA and maintained for employees of such Person or any of its
ERISA Affiliates; (x) withdrawal liability incurred under ERISA by such Person
or any of its ERISA Affiliates with respect to any Multiemployer Plan; (xi) all
monetary obligations under any receivables factoring, receivable sales or
similar transactions and all monetary obligations under any synthetic lease, tax
ownership/operating lease, off-balance sheet financing or similar financing; and
(xii) all obligations referred to in clauses (i) through (xi) of this definition
of another Person secured by (or for which the holder of such Indebtedness has
an existing right, contingent or otherwise, to be secured by) a Lien upon
property owned by such Person, even though such Person has not assumed or become
liable for the payment of such Indebtedness. The Indebtedness of any Person
shall include the Indebtedness of any partnership or joint venture in which such
Person is a general partner or a joint venturer.

“Indemnified Matters” has the meaning specified therefor in Section 12.15.

“Indemnitees” has the meaning specified therefor in Section 12.15.

“Insolvency Proceeding” means any proceeding commenced by or against any Person
under any provision of the Bankruptcy Code or under any other bankruptcy or
insolvency law, assignments for the benefit of creditors, formal or informal
moratoria, compositions, or extensions generally with creditors, or proceedings
seeking reorganization, arrangement, or other similar relief.

“Intercompany Subordination Agreement” means the Intercompany Subordination
Agreement, dated as of the Effective Date, duly executed by each of the Loan
Parties, substantially in the form of Exhibit I-1.

“Intercreditor Agreement” means an Intercreditor Agreement, dated as of even
date herewith, substantially in the form of Exhibit I-2, by and between the
Collateral Agent and Foothill.

“Interest Period” means, with respect to each LIBOR Rate Loan, a period
commencing on the date of the making of such LIBOR Rate Loan and ending 1, 2, 3
or 6 months thereafter; provided, however, that (a) if any Interest Period would
end on a day that is not a Business Day, such Interest Period shall be extended
(subject to clauses (c)-(e) below) to the next succeeding Business Day,
(b) interest shall accrue at the applicable rate based upon the LIBOR Rate from
and including the first day of each Interest Period to, but excluding, the day
on which any Interest Period expires, (c) any Interest Period that would end on
a day that is not a Business Day shall be extended to the next succeeding
Business Day unless such Business Day falls in another calendar month, in which
case such Interest Period shall end on the next preceding Business Day, (d) with
respect to an Interest Period that begins on the last Business Day of a calendar
month (or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period), the Interest Period shall
end on the last Business Day of the calendar month that is 1, 2, 3 or 6 months
after the date on which the Interest Period began, as applicable, and
(e) Borrower may not elect an Interest Period which will end after the Final
Maturity Date.

“Inventory” means all of each of the Loan Parties’ now owned or hereafter
acquired right, title, and interest with respect to inventory as defined in the
Code.

“IRC” means the Internal Revenue Code of 1986, as amended (or any successor
statute thereto) and the regulations thereunder.

“Jewish Philanthropies Modification Agreement” means that certain Modification
Agreement, dated as of December 18, 1998, by and between the Borrower and the
Foundation for Jewish Philanthropies, Inc., as amended by that certain Amendment
to the Modification Agreement dated June 6, 2002.

“Krieger Mortgage Seller Subordinated Note” means a promissory note, dated
October 31, 2003, in the original principal amount of $400,000 (with an
outstanding principal balance of $400,000 as of May 31, 2007), made by Metalico
Rochester to the order of Diversified Scrap Metals, Inc.

“Krieger Security Seller Subordinated Note” means a promissory note, dated
October 31, 2003, in the original principal amount of $756,708 (with an
outstanding principal balance of $204,821 as of May 31, 2007), made by Metalico
Rochester to the order of Diversified Scrap Metals, Inc.

“Krieger Subordination Agreement” means a subordination agreement, in form and
substance reasonably satisfactory to the Collateral Agent, by and among the
Collateral Agent, Foothill, and the holders of the Krieger Mortgage Seller
Subordinated Note and the Krieger Security Seller Subordinated Note.

“Lease” means any lease of real property to which any Loan Party or any of its
Subsidiaries is a party as lessor or lessee.

“Lender” and “Lenders” have the meanings specified therefor in the preamble
hereto.

“Liabilities” has the meaning specified therefor in Section 2.07.

“LIBOR Deadline” has the meaning set forth in Section 2.04(g)(ii)(A).

“LIBOR Notice” means a written notice in the form of Exhibit L-1.

“LIBOR Option” has the meaning specified therefor in Section 2.04(g)(i).

“LIBOR Rate” means, for each Interest Period for each LIBOR Rate Loan, the rate
per annum determined by Administrative Agent by dividing (a) the Base LIBOR Rate
for such Interest Period, by (b) 100% minus the Reserve Percentage. The LIBOR
Rate shall be adjusted on and as of the effective day of any change in the
Reserve Percentage.

“LIBOR Rate Loan” means each portion of a Loan that bears interest at a rate
determined by reference to the LIBOR Rate.

“Lien” means any mortgage, deed of trust, pledge, lien (statutory or otherwise),
security interest, charge or other encumbrance or security or preferential
arrangement of any nature, including any conditional sale or title retention
arrangement, any Capitalized Lease and any assignment, deposit arrangement or
financing lease intended as, or having the effect of, security.

“Loan” means the Term Loan A or the Term Loan B.

“Loan Account” means an account maintained hereunder by the Administrative Agent
on its books of account at the Payment Office, and with respect to the Borrower,
in which the Borrower will be charged with all Loans made to, and all other
Obligations incurred by, the Borrower.

“Loan Document” means this Agreement, the Term Loan A Funds Flow Agreement, the
Term Loan B Funds Flow Agreement, the Intercompany Subordination Agreement, any
Guaranty, any Security Agreement, any Mortgage, any Filing Authorization Letter,
the Intercreditor Agreement, the Niagara Subordination Agreement, and any other
agreement, instrument, and other document executed and delivered pursuant hereto
or thereto or otherwise evidencing or securing any Loan or any other Obligation.

“Loan Party” means the Borrower or any Guarantor.

“Loan Servicing Fee” has the meaning specified therefor in Section 2.06(b).

“Lockbox Bank” has the meaning specified therefor in Section 8.01(a).

“Lockboxes” has the meaning specified therefor in Section 8.01(a).

“Material Adverse Effect” means a material adverse effect on any of (i) the
operations, business, assets, properties, condition (financial or otherwise) or
prospects of any Loan Party or the Loan Parties taken as a whole, (ii)  the
ability of any Loan Party to perform any of its obligations under any Loan
Document to which it is a party, (iii) the legality, validity or enforceability
of this Agreement or any other Loan Document, (iv) the rights and remedies of
any Agent or any Lender under any Loan Document, or (v) the validity, perfection
or priority of a Lien in favor of the Collateral Agent for the benefit of the
Agents and the Lenders on any of the Collateral (other than any item or items of
Collateral having an aggregate fair market value of less than $100,000).

“Material Contract” means, with respect to any Person, (i) each contract or
agreement to which such Person or any of its Subsidiaries is a party involving
aggregate consideration payable to or by such Person or such Subsidiary of
$100,000 or more (other than purchase orders in the ordinary course of the
business of such Person or such Subsidiary and other than contracts that by
their terms may be terminated by such Person or Subsidiary in the ordinary
course of its business upon less than 60 days notice without penalty or premium)
and (ii) all other contracts or agreements material to the business, operations,
condition (financial or otherwise), performance, prospects or properties of such
Person or such Subsidiary.

“Maximum Credit Facility Amount” has the meaning specified therefor in the
recitals hereto.

“Maximum Priority First Lien Loan Amount” has the meaning ascribed thereto in
the Intercreditor Agreement as in effect on the date hereof.

“Metalico Akron” means Metalico Akron, Inc., an Ohio corporation.

“Metalico Akron Realty” means Metalico Akron Realty, Inc., an Ohio corporation.

“Metalico Buffalo” means Metalico Buffalo, Inc., a New York corporation.

“Metalico Niagara” means Metalico Niagara, Inc., a New York corporation.

“Metalico Rochester” means Metalico Rochester, Inc., a New York corporation.

“Metalico Transfer” means Metalico Transfer, Inc., a New York corporation.

“Metalico Transfer Realty” means Metalico Transfer Realty, Inc., a New York
corporation.

“Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.

“Mortgage” means a mortgage, deed of trust or deed to secure debt, in form and
substance reasonably satisfactory to the Collateral Agent, made by a Loan Party
in favor of the Collateral Agent for the benefit of the Agents and the Lenders,
securing the Obligations and delivered to the Collateral Agent pursuant to the
provisions hereof or otherwise.

“Multiemployer Plan” means a “multiemployer plan” as defined in
Section 4001(a)(3) of ERISA to which any Loan Party or any of its ERISA
Affiliates has contributed to, or has been obligated to contribute, at any time
during the preceding six (6) years.

“Net Cash Proceeds” means, (i) with respect to any Disposition by any Person or
any of its Subsidiaries, the amount of cash received (directly or indirectly)
from time to time (whether as initial consideration or through the payment or
disposition of deferred consideration) by or on behalf of such Person or such
Subsidiary, in connection therewith after deducting therefrom only (A) the
amount of any Indebtedness secured by any Permitted Lien on any asset (other
than Indebtedness assumed by the purchaser of such asset) which is required to
be, and is, repaid in connection with such Disposition (other than Indebtedness
under this Agreement), (B) reasonable expenses related thereto incurred by such
Person or such Subsidiary in connection therewith, (C) transfer taxes paid to
any taxing authorities by such Person or such Subsidiary in connection
therewith, and (D) net income taxes to be paid in connection with such
Disposition (after taking into account any tax credits or deductions and any tax
sharing arrangements) and (ii) with respect to the issuance or incurrence of any
Indebtedness by any Person or any of its Subsidiaries, or the sale or issuance
by any Person or any of its Subsidiaries of any shares of its Capital Stock, the
aggregate amount of cash received (directly or indirectly) from time to time
(whether as initial consideration or through the payment or disposition of
deferred consideration) by or on behalf of such Person or such Subsidiary in
connection therewith, after deducting therefrom only (A) reasonable expenses
related thereto incurred by such Person or such Subsidiary in connection
therewith, (B) transfer taxes paid by such Person or such Subsidiary in
connection therewith and (C) net income taxes to be paid in connection therewith
(after taking into account any tax credits or deductions and any tax sharing
arrangements); in each case of clause (i) and (ii) to the extent, but only to
the extent, that the amounts so deducted are (x) actually paid to a Person that,
except in the case of reasonable out-of-pocket expenses, is not an Affiliate of
such Person or any of its Subsidiaries and (y) properly attributable to such
transaction or to the asset that is the subject thereof.

“New Lending Office” has the meaning specified therefor in Section 2.08(d).

“New Subsidiary” has the meaning specified therefor in Section 7.02(b).

“Niagara Seller Subordinated Note” means a promissory note, dated October 31,
2005, in the original principal amount of $1,000,000 (with an outstanding
principal balance of approximately $625,000 as of May 31, 2007), made by
Metalico Niagara to the order of Ange’s Scrap Iron and Metal, Inc.

“Niagara Subordination Agreement” means a Subordination Agreement, substantially
in the form of Exhibit S-1, by and among the Collateral Agent, Foothill, and the
holder of the Niagara Seller Subordinated Note.

“Non-U.S. Lender” has the meaning specified therefor in Section 2.08(d).

“Notice of Borrowing” has the meaning specified therefor in Section 2.02(a).

“Obligations” means all present and future indebtedness, obligations, and
liabilities of each Loan Party to the Agents and the Lenders, or any of them,
under the Loan Documents, whether or not the right of payment in respect of such
claim is reduced to judgment, liquidated, unliquidated, fixed, contingent,
matured, disputed, undisputed, legal, equitable, secured, unsecured, and whether
or not such claim is discharged, stayed or otherwise affected by any proceeding
referred to in Section 9.01. Without limiting the generality of the foregoing,
the Obligations of each Loan Party under the Loan Documents include (a) the
obligation (irrespective of whether a claim therefor is allowed in any
Insolvency Proceeding) to pay principal, interest, charges, expenses, fees,
attorneys’ fees and disbursements, indemnities and other amounts payable by such
Person under the Loan Documents, and (b) the obligation of such Person to
reimburse any amount in respect of any of the foregoing that any Agent or any
Lender (in its sole discretion) may elect to pay or advance on behalf of such
Person.

“Operating Lease Obligations” means all obligations for the payment of rent for
any real or personal property under leases or agreements to lease, other than
Capitalized Lease Obligations.

“Other Taxes” has the meaning specified therefor in Section 2.08(b).

“Participant Register” has the meaning specified therefor in Section 12.07(g).

“Payment Office” means the Administrative Agent’s office located at 299 Park
Avenue, 23rd Floor, New York, New York or at such other office or offices of the
Administrative Agent as may be designated in writing from time to time by the
Administrative Agent to the Collateral Agent and the Borrower.

“PBGC” means the Pension Benefit Guaranty Corporation or any successor thereto.

“Permitted Dispositions” means (a) sales or other dispositions of Inventory to
buyers in the ordinary course of business, (b) sales or other dispositions of
obsolete or worn-out equipment in the ordinary course of business, (c) the use
or transfer of Cash and Cash Equivalents by the Borrower and its Subsidiaries in
a manner that is not prohibited by the terms of this Agreement or the other Loan
Documents, (d) the licensing by the Borrower and its Subsidiaries, on a
non-exclusive basis, of patents, trademarks, copyrights, and other intellectual
property rights in the ordinary course of business, and (e) the granting of
leases or subleases to other Persons not materially interfering with the conduct
of business of any of the Loan Parties, and (f) the sale, distribution, transfer
or other disposition of any of the Capital Stock of Beacon owned by the
Borrower.

“Permitted Indebtedness” means:

(a) any Indebtedness owing to any Agent and any Lender under this Agreement and
the other Loan Documents;

(b) Indebtedness listed on Schedule 7.02(b), and the extension of maturity,
refinancing or modification of the terms thereof; provided, however, that
(i) such extension, refinancing or modification is pursuant to terms that are
not less favorable to the Loan Parties and the Lenders than the terms of the
Indebtedness being extended, refinanced or modified and (ii) after giving effect
to such extension, refinancing or modification, the amount of such Indebtedness
is not greater than the amount of Indebtedness outstanding immediately prior to
such extension, refinancing or modification plus accrued interest thereon and
the fees incurred in connection with the extension, refinancing, or
modification;

(c) Indebtedness evidenced by Capitalized Lease Obligations entered into in
order to finance Capital Expenditures made by the Loan Parties in accordance
with the provisions of Section 7.02(f), which Indebtedness, when aggregated with
the principal amount of all Indebtedness incurred under this clause (c) and
clause (d) of this definition, does not exceed $10,000,000 at any time
outstanding;

(d) purchase money Indebtedness incurred to enable a Loan Party to acquire
equipment in the ordinary course of its business, which Indebtedness, when
aggregated with the principal amount of all Indebtedness incurred under this
clause (d) and clause (c) of this definition, does not exceed $10,000,000 at any
time outstanding;

(e) Indebtedness permitted under Section 7.02(e);

(f) Indebtedness of the Borrower or any of its Subsidiaries under any Hedging
Agreement so long as such Hedging Agreements are used solely as a part of its
normal business operations as a risk management strategy or hedge against
changes resulting from market operations and not as a means to speculate for
investment purposes on trends and shifts in financial or commodities markets;

(g) Indebtedness owed by one Loan Party to another Loan Party so long as the
making of the investment by the Loan Party that is acting as the lender is
permitted hereunder;

(h) Foothill Indebtedness in an aggregate principal amount not in excess of
$93,500,000 at any time outstanding;

(i) Indebtedness evidenced by the Krieger Mortgage Seller Subordinated Note in
an aggregate principal amount not in excess of $400,000 at any time outstanding;

(j) Indebtedness evidenced by the Krieger Security Seller Subordinated Note in
an aggregate principal amount not in excess of $204,821 at any time outstanding;

(k) Indebtedness evidenced by the Niagara Seller Subordinated Note in an
aggregate principal amount not in excess of $625,000 at any time outstanding;

(l) Indebtedness evidenced by the United Alloys Seller Note in an aggregate
principal amount not in excess of $157,562.08 at any time outstanding;

(m) Indebtedness evidenced by the United Alloys Non-Competition Agreement in an
aggregate principal amount not in excess of $157,561.08 at any time outstanding;

(n) Indebtedness evidenced by the Jewish Philanthropies Modification Agreement
in an aggregate principal amount not in excess of $260,000 at any time
outstanding;

(o) Indebtedness evidenced by the Frank Non-Competition Agreement in an
aggregate principal amount not in excess of $437,500 at any time outstanding;

(p) Indebtedness evidenced by the Compass/150 Lee Notes in the aggregate
principal amount not in excess of $915,209 at any time outstanding;

(q) Indebtedness evidenced by the Compass Non-Compete Agreement in an aggregate
principal amount not in excess of $115,000 at any time outstanding;

(r) Indebtedness evidenced by the Tranzact Notes in the aggregate principal
amount not in excess of $2,112,576 at any time outstanding;

(s) Contingent Obligations represented by any guaranties by Borrower or any of
its Subsidiaries of Permitted Indebtedness outstanding under the Compass/150
Notes or the Tranzact Notes;

(t) the Annaco Earn-Out Arrangements; and

(u) Subordinated Debt.

“Permitted Investments” means (i) marketable direct obligations issued or
unconditionally guaranteed by the United States Government or issued by any
agency or instrumentality thereof and backed by the full faith and credit of the
United States, in each case, maturing within six months from the date of
acquisition thereof; (ii) commercial paper, maturing not more than 270 days
after the date of issue rated P-1 by Moody’s or A-1 by Standard & Poor’s;
(iii) certificates of deposit maturing not more than 270 days after the date of
issue, issued by commercial banking institutions and money market or demand
deposit accounts maintained at commercial banking institutions, each of which is
a member of the Federal Reserve System and has a combined capital and surplus
and undivided profits of not less than $500,000,000; (iv) repurchase agreements
having maturities of not more than 90 days from the date of acquisition which
are entered into with banks included in the commercial banking institutions
described in clause (iii) above and which are secured by readily marketable
direct obligations of the United States Government or any agency thereof,
(v) money market accounts maintained with mutual funds having assets in excess
of $2,500,000,000; and (vi) tax exempt securities rated A or better by Moody’s
or A+ or better by Standard & Poor’s.

“Permitted Liens” means:

(a) Liens securing the Obligations;

(b) Liens for taxes, assessments, levies, and governmental charges the payment
of which is not required under Section 7.01(c);

(c) Liens imposed by law, such as carriers’, warehousemen’s, mechanics’,
materialmen’s and other similar Liens arising in the ordinary course of business
and securing obligations (other than Indebtedness for borrowed money) that are
not overdue by more than 30 days or are being contested in good faith and by
appropriate proceedings promptly initiated and diligently conducted, and a
reserve or other appropriate provision, if any, as shall be required by GAAP
shall have been made therefor;

(d) Liens described on Schedule 7.02(a), but not the extension of coverage
thereof to other property or assets;

(e) Liens arising under Capitalized Leases or securing purchase money
Indebtedness permitted under the definition of Permitted Indebtedness; provided,
however, that (A) no such Lien shall extend to or cover any other property of
any Loan Party or any of its Subsidiaries, and (B) the principal amount of the
Indebtedness secured by any such Lien shall not exceed the lesser of 80% of the
fair market value or the cost of the property so held or acquired;

(f) deposits and pledges of cash securing (i) obligations incurred in respect of
workers’ compensation, unemployment insurance or other forms of governmental
insurance or benefits, (ii) the performance of bids, tenders, leases, contracts
(other than for the payment of money) and statutory obligations or
(iii) obligations on surety or appeal bonds, but only to the extent such
deposits or pledges are made or otherwise arise in the ordinary course of
business and secure obligations not past due;

(g) easements, zoning restrictions and similar encumbrances on real property and
minor irregularities in the title thereto that do not (i) secure obligations for
the payment of money or (ii) materially impair the value of such property or its
use by any Loan Party or any of its Subsidiaries in the normal conduct of such
Person’s business;

(h) leases or subleases granted to other Persons not materially interfering with
the conduct of the business of the Borrower or any of its Subsidiaries;

(i) precautionary financing statement filings regarding operating leases;

(j) Liens arising out of the existence of judgments or awards not giving rise to
an Event of Default;

(k) statutory and common law landlords’ liens under leases to which the Borrower
or any of its Subsidiaries is a party;

(l) Liens securing the Foothill Indebtedness permitted under clause (h) of the
definition of Permitted Indebtedness; and

(m) Liens securing refinancing Indebtedness permitted to be incurred hereunder;
provided, that such Liens do not extend to any property or assets other than the
property or assets that served as collateral for the refinanced Indebtedness.

“Permitted Preferred Stock” means and refers to any Preferred Stock issued by
the Borrower (and not by one or more of its Subsidiaries) that is not Prohibited
Preferred Stock.

“Person” means an individual, corporation, limited liability company,
partnership, association, joint-stock company, trust, unincorporated
organization, joint venture or other enterprise or entity or Governmental
Authority.

“Post-Default Rate” means a rate of interest per annum equal to the rate of
interest otherwise in effect from time to time pursuant to the terms of this
Agreement plus 2.0 percentage points, or, if a rate of interest is not otherwise
in effect, interest at the highest rate specified herein for any Loan prior to
the Event of Default plus 2.0 percentage points.

“Preferred Stock” means, as applied to the Capital Stock of any Person, the
Capital Stock of any class or classes (however designated) that is preferred
with respect to the payment of dividends, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution of such Person,
over shares of Capital Stock of any other class of such Person.

“Prepayment Premium” means, as of any date of determination, an amount equal to
(a) during the period from and after the Effective Date up to the date that is
the first anniversary of the Effective Date, 2% times the portion of Term Loans
being prepaid, (b) during the period from and including the date that is the
first anniversary of the Effective Date up to the date that is the second
anniversary of the Effective Date, 1% times the portion of Term Loans being
prepaid, and (c) during the period from and including the date that is the
second anniversary of the Effective Date up to the Final Maturity Date, zero.

“Prohibited Preferred Stock” means any Preferred Stock that by its terms is
mandatorily redeemable or subject to any other payment obligation (including any
obligation to pay dividends, other than dividends of shares of Preferred Stock
of the same class and series payable in kind or dividends of shares of common
stock) on or before a date that is less than 2 years after the Final Maturity
Date, or, on or before the date that is less than 2 years after the Final
Maturity Date, is redeemable at the option of the holder thereof for cash or
assets or securities (other than distributions in kind of shares of Preferred
Stock of the same class and series or of shares of common stock).

“property” means any right or interest in or to property of any kind whatsoever,
whether real, personal or mixed and whether tangible or intangible.

“Pro Rata Share” means:

(a) with respect to a Lender’s obligation to make the Term Loan A and right to
receive payments of interest, fees, and principal with respect thereto, the
percentage obtained by dividing (i) such Lender’s Term Loan A Commitment, by
(ii) the Total Term Loan A Commitment, provided that if the Total Term Loan A
Commitment has been reduced to zero, the numerator shall be the aggregate unpaid
principal amount of such Lender’s portion of the Term Loan A and the denominator
shall be the aggregate unpaid principal amount of the Term Loan A,

(b) with respect to a Lender’s obligation to make the Term Loan B and right to
receive payments of interest, fees, and principal with respect thereto, the
percentage obtained by dividing (i) such Lender’s Term Loan B Commitment, by
(ii) the Total Term Loan B Commitment, provided that if the Total Term Loan B
Commitment has been reduced to zero, the numerator shall be the aggregate unpaid
principal amount of such Lender’s portion of the Term Loan B and the denominator
shall be the aggregate unpaid principal amount of the Term Loan B, and

(c) with respect to all other matters (including the indemnification obligations
arising under Section 10.05) regarding a Lender, the percentage obtained by
dividing (i) the sum of the unpaid principal amount of such Lender’s Term Loan A
and the unpaid principal amount of such Lender’s portion of the Term Loan B, by
(ii) the sum of the aggregate unpaid principal amount of the Term Loans.

“Purchase Price” means, with respect to either Acquisition, an amount equal to
the sum of (i) the aggregate consideration, whether cash, property or securities
(including the fair market value of any Capital Stock of any Loan Party issued
in connection with such Acquisition), paid or delivered by a Loan Party in
connection with such Acquisition, plus (ii) the aggregate amount of liabilities
of the acquired business (net of current assets of the acquired business) that
would be reflected on a balance sheet (if such were to be prepared) of the
Borrower and its Subsidiaries after giving effect to such Acquisition.

“Qualified Cash” means, as of any date of determination, the amount of
unrestricted Cash and Cash Equivalents of the Borrower and its Subsidiaries that
is subject to a control agreement in favor of Collateral Agent and that is on
deposit with banks, or in securities accounts with securities intermediaries, or
any combination thereof.

“Qualified Issuance” means a private placement of the Borrower’s common Capital
Stock consummated on or before the Term Loan B Funding Date which raises Net
Cash Proceeds of not less than $30,000,000.

“Rating Agencies” has the meaning specified therefor in Section 2.07.

“Reference Bank” means JPMorgan Chase Bank, N.A., its successors or any other
commercial bank designated by the Administrative Agent to the Borrower from time
to time.

“Reference Rate” means the greater of (a) 7.5 percent per annum, and (b) the
rate of interest publicly announced by the Reference Bank in New York, New York
from time to time as its reference rate, base rate or prime rate. The reference
rate, base rate or prime rate is determined from time to time by the Reference
Bank as a means of pricing some loans to its borrowers and neither is tied to
any external rate of interest or index nor necessarily reflects the lowest rate
of interest actually charged by the Reference Bank to any particular class or
category of customers. Each change in the Reference Rate shall be effective from
and including the date such change is publicly announced as being effective.

“Register” has the meaning specified therefor in Section 12.07(d).

“Registered Loan” has the meaning specified therefor in Section 12.07(d).

“Regulation T”, “Regulation U” and “Regulation X” mean, respectively,
Regulations T, U and X of the Board or any successor, as the same may be amended
or supplemented from time to time.

“Reinvestment Eligible Funds” means (a) Net Cash Proceeds which, but for the
application of Section 2.05(d)(ii), would be required to be used to prepay the
Loans pursuant to Section 2.05(c)(v) or (b) Extraordinary Receipts consisting of
insurance or condemnation proceeds paid as the result of loss, destruction,
casualty, condemnation or expropriation which, but for the application of
Section 2.05(d)(ii), would be required to be used to prepay the Loans pursuant
to Section 2.05(c)(vi).

“Reinvestment Notice” has the meaning specified therefor in Section 2.05(d).

“Related Fund” means a fund, money market account, investment account or other
account managed by a Lender or an Affiliate of such Lender or its investment
manager.

“Related Party Assignment” has the meaning specified therefor in Section
12.07(b).

“Related Party Register” has the meaning specified therefor in Section 12.07(d).

“Release” means any spilling, leaking, pumping, pouring, emitting, emptying,
discharging, injecting, escaping, leaching, seeping, migrating, dumping or
disposing of any Hazardous Material (including the abandonment or discarding of
barrels, containers and other closed receptacles containing any Hazardous
Material) into the indoor or outdoor environment, including the movement of
Hazardous Materials through or in the ambient air, soil, surface or ground
water, or property.

“Remedial Action” means all actions taken to (i) clean up, remove, remediate,
contain, treat, monitor, assess, evaluate or in any other way address Hazardous
Materials in the indoor or outdoor environment; (ii) prevent or minimize a
Release or threatened Release of Hazardous Materials so they do not migrate or
endanger or threaten to endanger public health or welfare or the indoor or
outdoor environment; (iii) perform pre-remedial studies and investigations and
post-remedial operation and maintenance activities; or (iv) any other actions
authorized by 42 U.S.C. § 9601.

“Reportable Event” means an event described in Section 4043 of ERISA (other than
an event not subject to the provision for 30-day notice to the PBGC under the
regulations promulgated under such Section).

“Required Lenders” means Lenders whose Pro Rata Shares (calculated under clause
(c) of the definition thereof) aggregate more than 50%.

“Reserve Percentage” means, on any day, for any Lender, the maximum percentage
prescribed by the Board (or any successor Governmental Authority) for
determining the reserve requirements (including any basic, supplemental,
marginal, or emergency reserves) that are in effect on such date with respect to
eurocurrency funding (currently referred to as “eurocurrency liabilities”) of
that Lender, but so long as such Lender is not required or directed under
applicable regulations to maintain such reserves, the Reserve Percentage shall
be zero.

“SEC” means the Securities and Exchange Commission or any other similar or
successor agency of the Federal government administering the Securities Act.

“Securities Act” means the Securities Act of 1933, as amended, or any similar
Federal statute, and the rules and regulations of the SEC thereunder, all as the
same shall be in effect from time to time.

“Securitization” has the meaning specified therefor in Section 2.07.

“Securitization Parties” has the meaning specified therefor in Section 2.07.

“Security Agreement” means a Security Agreement, in form and substance
reasonably satisfactory to Collateral Agent, made by a Loan Party in favor of
the Collateral Agent for the benefit of the Agents and the Lenders, securing the
Obligations and delivered to the Collateral Agent.

“Settlement Period” has the meaning specified therefor in Section 2.02(d)(i)
hereof.

“Solvent” means, with respect to any Person on a particular date, that on such
date (i) the fair value of the property of such Person is not less than the
total amount of the liabilities of such Person, (ii) the present fair salable
value of the assets of such Person is not less than the amount that will be
required to pay the probable liability of such Person on its existing debts as
they become absolute and matured, (iii) such Person is able to realize upon its
assets and pay its debts and other liabilities, contingent obligations and other
commitments as they mature in the normal course of business, (iv) such Person
does not intend to, and does not believe that it will, incur debts or
liabilities beyond such Person’s ability to pay as such debts and liabilities
mature, and (v) such Person is not engaged in business or a transaction, and is
not about to engage in business or a transaction, for which such Person’s
property would constitute unreasonably small capital.

“Standard & Poor’s” means Standard & Poor’s Ratings Services, a division of
The McGraw-Hill Companies, Inc. and any successor thereto.

“Subordinated Debt” means Indebtedness of the Borrower that is on terms and
conditions (including payment terms, interest rates, covenants, remedies,
defaults and other material terms) reasonably satisfactory to the Collateral
Agent and the Required Lenders and which has been expressly subordinated in
right of payment to all Indebtedness of the Borrower under the Loan Documents by
the execution and delivery of a subordination agreement, in form and substance
reasonably satisfactory to the Collateral Agent.

“Subsidiary” means, with respect to any Person at any date, any corporation,
limited or general partnership, limited liability company, trust, estate,
association, joint venture or other business entity (i) the accounts of which
would be consolidated with those of such Person in such Person’s consolidated
financial statements if such financial statements were prepared in accordance
with GAAP or (ii) of which more than 50% of (A) the outstanding Capital Stock
having (in the absence of contingencies) ordinary voting power to elect a
majority of the board of directors or other managing body of such Person, (B) in
the case of a partnership or limited liability company, the interest in the
capital or profits of such partnership or limited liability company or (C) in
the case of a trust, estate, association, joint venture or other entity, the
beneficial interest in such trust, estate, association or other entity business
is, at the time of determination, owned or controlled directly or indirectly
through one or more intermediaries, by such Person; provided, however, that on
and prior to the Effective Date and prior to the consummation of the Annaco
Acquisition, all references herein or in any other Loan Document to the Borrower
and its Subsidiaries shall be determined as if the assets of Annaco have been
acquired pursuant to the Annaco Acquisition; provided further, however, that on
the date on which Totalcat Acquisition is to be consummated, but immediately
prior to the consummation thereof, all references herein or in any other Loan
Document to the Borrower and its Subsidiaries shall be determined as if the
Capital Stock of Totalcat has been acquired pursuant to the Totalcat
Acquisition; provided further, however, that so long as Beacon is not a
Guarantor under this Agreement, it shall not be deemed to be a Subsidiary of the
Borrower for any purpose under this Agreement.

“Succeeding Fiscal Year” has the meaning specified therefor in Section 7.03(e).

“Taxes” has the meaning specified therefor in Section 2.08(a).

“Term Loans” means the Term Loan A and the Term Loan B.

“Term Loan A” has the meaning specified therefor in Section 2.01(a)(i).

“Term Loan A Closing Fee” has the meaning specified therefor in Section
2.06(a)(i).

“Term Loan A Commitment” means, with respect to each Lender, the commitment of
such Lender to make its portion of the Term Loan A to the Borrower in the amount
set forth in Schedule C-1 hereto, as the same may be terminated or reduced from
time to time in accordance with the terms of this Agreement.

“Term Loan A Funds Flow Agreement” means that certain Term Loan A Funds Flow
Agreement, dated of even date herewith, by and among Administrative Agent, the
Lenders and each Loan Party.

“Term Loan A Lender” means a Lender with a Term Loan A Commitment or a portion
of the Term Loan A.

“Term Loan A Obligations” means any Obligations with respect to the Term Loan A
(including the principal thereof, the interest thereon, and the fees and
expenses specifically related thereto).

“Term Loan B” has the meaning specified therefor in Section 2.01(a)(ii).

“Term Loan B Closing Fee” has the meaning specified therefor in Section
2.06(a)(ii).

“Term Loan B Commitment” means, with respect to each Lender, the commitment of
such Lender to make its portion of the Term Loan B to the Borrower in the amount
set forth in Schedule C-1 hereto, as the same may be terminated or reduced from
time to time in accordance with the terms of this Agreement.

“Term Loan B Funding Date” means the date on which all of the conditions
precedent set forth in Section 5.02 are first satisfied or waived and the
borrowing of the Term Loan B shall have occurred.

“Term Loan B Funding Period” means the period from and including the Effective
Date to the date that is six months from the Effective Date.

“Term Loan B Funds Flow Agreement” means that certain Term Loan B Funds Flow
Agreement, dated of the Term Loan B Funding Date, by and among Administrative
Agent, the Lenders and each Loan Party.

“Term Loan B Lender” means a Lender with a Term Loan B Commitment or a portion
of the Term Loan B.

“Term Loan B Obligations” means any Obligations with respect to the Term Loan B
(including the principal thereof, the interest thereon, and the fees and
expenses specifically related thereto).

“Termination Event” means (i) a Reportable Event with respect to any Employee
Plan, (ii) any event that causes any Loan Party or any of its ERISA Affiliates
to incur liability under Section 409, 502(i), 502(l), 515, 4062, 4063, 4064,
4069, 4201, 4204 or 4212 of ERISA or Section 4971 or 4975 of the IRC, (iii) the
filing of a notice of intent to terminate an Employee Plan or the treatment of
an Employee Plan amendment as a termination under Section 4041 of ERISA,
(iv) the institution of proceedings by the PBGC to terminate an Employee Plan,
or (v) any other event or condition which might constitute grounds under
Section 4042 of ERISA for the termination of, or the appointment of a trustee to
administer, any Employee Plan.

“Title Insurance Policy” means a mortgagee’s loan policy, in form and substance
satisfactory to the Collateral Agent, together with all endorsements made from
time to time thereto, issued by or on behalf of a title insurance company
satisfactory to the Collateral Agent, insuring the Lien created by a Mortgage in
an amount and on terms satisfactory to the Collateral Agent, delivered to the
Collateral Agent.

“Totalcat” means Totalcat Group, Inc., a Delaware corporation.

“Totalcat Acquisition” means the acquisition by the Borrower of 82.5% of the
issued and outstanding Capital Stock of Totalcat, together with an option to
purchase the remaining Capital Stock of Totalcat, all in accordance with the
terms of the Totalcat Acquisition Agreement.

“Totalcat Acquisition Agreement” means that certain Stock Purchase Agreement,
dated as of June 25, 2007, by and among each of the stockholders of Totalcat
signatory thereto and the Borrower.

“Totalcat Acquisition Documents” means, collectively, the Totalcat Acquisition
Agreement and all other documents and agreements executed and delivered in
connection therewith.

“Total Commitment” means the sum of the Total Term Loan A Commitment and the
Total Term Loan B Commitment.

“Total Term Loan A Commitment” means the sum of the amounts of the Lenders’ Term
Loan A Commitments, which amount is $32,000,000 as of the Effective Date.

“Total Term Loan B Commitment” means the sum of the amounts of the Lenders’ Term
Loan B Commitments, which amount is $18,000,000 as of the Term Loan B Funding
Date.

"Transferee” has the meaning specified therefor in Section 2.08(a).

“Tranzact” means Tranzact Corporation, a Delaware corporation.

“Tranzact Notes” means, collectively, (i) that certain promissory note, dated
May 31, 2007, by the Borrower in favor of William F. Zimmerman in the original
principal amount of $624,155.92, and (ii) that certain promissory note, dated
May 31, 2007, by Tranzact in favor or William F. Zimmerman in the original
principal amount of $1,479,350.85.

“TTM EBITDA” means, as of any date of determination and with respect to a
Person, the Consolidated EBITDA of such Person and its Subsidiaries for the
period of 12 consecutive months most recently ended.

“United Alloys Non-Competition Agreement” means that certain Non-Competition
Agreement dated as of October 10, 2002, by and among Metalico Buffalo and each
of United Alloys & Steel Corporation, Peter A Linder and Edward Linder.

“United Alloys Seller Note” means a promissory note, dated October 1, 2002, in
the original principal amount of $451,678 (with an outstanding principal balance
of $315,123 as of May 31, 2007), made by Metalico Buffalo to the order of United
Alloys & Steel Corporation.

“WARN” has the meaning specified therefor in Section 6.01(z).

Section 1.02 Terms Generally. The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words “include,” “includes” and “including” shall
be deemed to be followed by the phrase “without limitation,” whether or not so
expressly stated in each such instance and the term “or” has, except where
otherwise indicated, the inclusive meaning represented by the phrase “and/or.”
The word “will” shall be construed to have the same meaning and effect as the
word “shall.” Unless the context requires otherwise, (a) any definition of or
reference to any agreement, instrument or other document herein shall be
construed as referring to such agreement, instrument or other document as from
time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein),
(b) any reference herein to any Person shall be construed to include such
Person’s successors and assigns, (c) the words “herein”, “hereof” and
“hereunder”, and words of similar import, shall be construed to refer to this
Agreement in its entirety and not to any particular provision hereof, (d) all
references herein to Articles, Sections, Exhibits and Schedules shall be
construed to refer to Articles and Sections of, and Exhibits and Schedules to,
this Agreement and (e) the words “asset” and “property” shall be construed to
have the same meaning and effect and to refer to any and all tangible and
intangible assets and properties, including cash, securities, accounts and
contract rights. References in this Agreement to “determination” by any Agent
include estimates honestly made by such Agent (in the case of quantitative
determinations) and beliefs honestly held by such Agent (in the case of
qualitative determinations).

Section 1.03 Accounting and Other Terms. Unless otherwise expressly provided
herein, each accounting term used herein shall have the meaning given it under
GAAP. All terms used in this Agreement which are defined in Article 8 or
Article 9 of the Code and which are not otherwise defined herein shall have the
same meanings herein as set forth therein.

Section 1.04 Time References. Unless otherwise indicated herein, all references
to time of day refer to Eastern Standard Time or Eastern daylight saving time,
as in effect in New York City on such day. For purposes of the computation of a
period of time from a specified date to a later specified date, the word “from”
means “from and including” and the words “to” and “until” each means “to but
excluding”; provided, however, that with respect to a computation of fees or
interest payable to any Agent or any Lender , such period shall in any event
consist of at least one full day.

ARTICLE II

THE LOANS

Section 2.01 Commitments. (a) Subject to the terms and conditions and relying
upon the representations and warranties herein set forth:

(i) each Term Loan A Lender severally agrees to make a term loan (collectively,
the “Term Loan A”) to the Borrower on the Effective Date, in an aggregate
principal amount equal to the amount of such Lender’s Term Loan A Commitment.

(ii) during the Term Loan B Funding Period, each Term Loan B Lender severally
agrees to make a term loan (collectively, the “Term Loan B”) to the Borrower on
the Term Loan B Funding Date, in an aggregate principal amount equal to the
amount of such Lender’s Term Loan Commitment.

(b) Notwithstanding the foregoing:

(i) The aggregate principal amount of the Term Loan A made on the Effective Date
shall not exceed the Total Term Loan A Commitment. Any principal amount of the
Term Loan A that is repaid or prepaid may not be reborrowed.

(ii) The aggregate principal amount of the Term Loan B made on the Term Loan B
Funding Date shall not exceed the Total Term Loan B Commitment. Any principal
amount of the Term Loan B that is repaid or prepaid may not be reborrowed.

Section 2.02 Making the Loans. (a) The Borrower shall give the Administrative
Agent prior telephonic notice (immediately confirmed in writing, in
substantially the form of Exhibit 2.01(b)(ii) hereto (a “Notice of Borrowing”)),
not later than 12:00 noon (New York City time) on the date which is 3 Business
Days prior to the date of the proposed Loan (or such shorter period as the
Administrative Agent is willing, in its sole discretion, to accommodate from
time to time). Such Notice of Borrowing shall be irrevocable and shall specify
(i) the principal amount of the proposed Loan, (ii) the proposed borrowing date,
which must be a Business Day, and must be (x) with respect to Term Loan A, the
Effective Date, and (y) with respect to Term Loan B, the Term Loan B Funding
Date, (iii) whether the proposed Loan is to be a Reference Rate Loan or a LIBOR
Rate Loan, and (iv) in the case of a LIBOR Rate Loan, the initial Interest
Period to be applicable thereto, which shall be a period contemplated by the
definition of the term “Interest Period”. If no election as to the type of Loan
is specified, then the requested Loan shall be a Reference Rate Loan. If no
Interest Period is specified with respect to any requested LIBOR Rate Loan, then
the Borrower shall be deemed to have selected an Interest Period of one month’s
duration. The Administrative Agent and the Lenders may act without liability
upon the basis of written, telecopied or telephonic notice believed by the
Administrative Agent in good faith to be from the Borrower (or from any
Authorized Officer thereof designated in writing purportedly from the Borrower
to the Administrative Agent). The Borrower hereby waives the right to dispute
the Administrative Agent’s record of the terms of any such telephonic Notice of
Borrowing. The Administrative Agent and each Lender shall be entitled to rely
conclusively on any Authorized Officer’s authority to request a Loan on behalf
of the Borrower until the Administrative Agent receives written notice to the
contrary. The Administrative Agent and the Lenders shall have no duty to verify
the authenticity of the signature appearing on any written Notice of Borrowing.

(b) Each Notice of Borrowing pursuant to this Section 2.02 shall be irrevocable
and the Borrower shall be bound to make a borrowing in accordance therewith.

(c) All Loans under this Agreement shall be made by the Lenders simultaneously
on the funding date applicable thereto and proportionately to their Pro Rata
Shares of the Total Term Loan A Commitment and the Total Term Loan B Commitment,
as the case may be, it being understood that no Lender shall be responsible for
any default by any other Lender in that other Lender’s obligations to make a
Loan requested hereunder, nor shall the Commitment of any Lender be increased or
decreased as a result of the default by any other Lender in that other Lender’s
obligation to make a Loan requested hereunder, and each Lender shall be
obligated to make the Loans required to be made by it by the terms of this
Agreement regardless of the failure by any other Lender.

Section 2.03 Repayment of Loans; Evidence of Debt.

(a) The outstanding principal amount of Term Loan A and Term Loan B shall be due
and payable on the Final Maturity Date.

(b) Each Lender shall maintain in accordance with its usual practice an account
or accounts evidencing the Indebtedness of the Borrower to such Lender resulting
from each Loan made by such Lender, including the amounts of principal and
interest payable and paid to such Lender from time to time hereunder.

(c) The Administrative Agent shall maintain accounts in which it shall record
(i) the amount of each Loan made hereunder, (ii) the amount of any principal or
interest due and payable or to become due and payable from the Borrower to each
Lender hereunder and (iii) the amount of any sum received by the Administrative
Agent hereunder for the account of the Lenders and each Lender’s share thereof.

(d) The entries made in the accounts maintained pursuant to paragraphs (b) or
(c) of this Section 2.03 shall be prima facie evidence of the existence and
amounts of the obligations recorded therein; provided that the failure of any
Lender or the Administrative Agent to maintain such accounts or any error
therein shall not in any manner affect the obligation of the Borrower to repay
the Loans in accordance with the terms of this Agreement.

(e) Any Lender may request that Loans made by it be evidenced by a promissory
note. In such event, the Borrower shall execute and deliver to such Lender a
promissory note payable to the order of such Lender (or, if requested by such
Lender, to such Lender and its registered assigns) in a form furnished by the
Collateral Agent and reasonably satisfactory to the Borrower. Thereafter, the
Loans evidenced by such promissory note and interest thereon shall at all times
(including after assignment pursuant to Section 12.07) be represented by one or
more promissory notes in such form payable to the order of the payee named
therein (or, if such promissory note is a registered note, to such payee and its
registered assigns).

Section 2.04 Interest.

(a) Term Loan A. The Term Loan A shall bear interest on the principal amount
thereof from time to time outstanding, from the date of the making of the Term
Loan A until such principal amount is repaid, as follows: (i) if the relevant
portion of the Term Loan A is a LIBOR Rate Loan, at a rate per annum equal to
the LIBOR Rate plus 6.5 percentage points, and (ii) otherwise, at a rate per
annum equal to the Reference Rate plus 3.5 percentage points.

(b) Term Loan B. The Term Loan B shall bear interest on the principal amount
thereof from time to time outstanding, from the date of the making of the Term
Loan B until such principal amount is repaid, as follows: (i) if the relevant
portion of the Term Loan B is a LIBOR Rate Loan, at a rate per annum equal to
the LIBOR Rate plus 6.5 percentage points, and (ii) otherwise, at a rate per
annum equal to the Reference Rate plus 3.5 percentage points.

(c) Default Interest. To the extent permitted by law, upon the occurrence and
during the continuance of an Event of Default, the principal of, and all accrued
and unpaid interest on, all Loans, fees, indemnities, or any other Obligations
of the Loan Parties under this Agreement and the other Loan Documents, shall
bear interest, from the date such Event of Default occurred until the date such
Event of Default is cured or waived in writing in accordance herewith, at a rate
per annum equal at all times to the Post-Default Rate. All interest at the
Post-Default Rate shall be payable on demand.

(d) LIBOR Option.

(i) Interest and Interest Payment Dates. In lieu of having interest charged at
the rate based upon the Reference Rate, the Borrower shall have the option (the
“LIBOR Option”) to have interest on all or a portion of the Loans be charged at
a rate of interest based upon the LIBOR Rate. Interest on LIBOR Rate Loans shall
be payable on the earliest of (A) the last day the Interest Period applicable
thereto; provided, however, that, subject to the following clauses (B) and (C),
in the case of any Interest Period greater than 1 month in duration, interest
shall be payable at 1 month intervals after the commencement of the applicable
Interest Period and on the last day of such Interest Period, (B) the occurrence
of an Event of Default in consequence of which the Required Lenders or
Collateral Agent on behalf thereof elect to accelerate the maturity of all or
any portion of the Obligations, or (C) termination of this Agreement pursuant to
the terms hereof. On the last day of each applicable Interest Period, unless the
Borrower properly has exercised the LIBOR Option with respect thereto, the
interest rate applicable to such LIBOR Rate Loan automatically shall convert to
the rate of interest then applicable to Reference Rate Loans of the same type
hereunder. At any time that an Event of Default has occurred and is continuing,
the Borrower no longer shall have the option to request that Loans bear interest
at the LIBOR Rate and Administrative Agent shall have the right to convert the
interest rate on all outstanding LIBOR Rate Loans to the rate then applicable to
Reference Rate Loans hereunder.

(ii) LIBOR Election.

(A) The Borrower may, at any time and from time to time, so long as no Event of
Default has occurred and is continuing, elect to exercise the LIBOR Option by
notifying Administrative Agent prior to 11:00 a.m. (New York time) at least 3
Business Days prior to the commencement of the proposed Interest Period (the
“LIBOR Deadline”). Notice of the Borrower’s election of the LIBOR Option for a
permitted portion of the Loans and an Interest Period pursuant to this Section
shall be made by delivery to Administrative Agent of a LIBOR Notice received by
Administrative Agent before the LIBOR Deadline. Promptly upon its receipt of
each such LIBOR Notice, Administrative Agent shall provide a copy thereof to
each of the Lenders having a Commitment of the type to which such LIBOR Notice
relates.

(B) Each LIBOR Notice shall be irrevocable and binding on the Borrower. In
connection with each LIBOR Rate Loan, the Borrower shall indemnify, defend, and
hold Administrative Agent and the Lenders harmless against any loss, cost, or
expense incurred by Administrative Agent or any Lender as a result of (1) the
payment of any principal of any LIBOR Rate Loan other than on the last day of an
Interest Period applicable thereto (including as a result of an Event of
Default), (2) the conversion of any LIBOR Rate Loan other than on the last day
of the Interest Period applicable thereto, or (3) the failure to borrow,
convert, continue or prepay any LIBOR Rate Loan on the date specified in any
LIBOR Notice delivered pursuant hereto (such losses, costs, and expenses,
collectively, “Funding Losses”). Funding Losses shall, with respect to
Administrative Agent or any Lender, be deemed to equal the amount determined by
Administrative Agent or such Lender to be the excess, if any, of (x) the amount
of interest that would have accrued on the principal amount of such LIBOR Rate
Loan had such event not occurred, at the LIBOR Rate that would have been
applicable thereto, for the period from the date of such event to the last day
of the then current Interest Period therefor (or, in the case of a failure to
borrow, convert or continue, for the period that would have been the Interest
Period therefor), minus (y) the amount of interest that would accrue on such
principal amount for such period at the interest rate which Administrative Agent
or such Lender would be offered were it to be offered, at the commencement of
such period, on Dollar deposits of a comparable amount and period in the London
interbank market. A certificate of Administrative Agent or a Lender delivered to
the Borrower setting forth any amount or amounts that Administrative Agent or
such Lender is entitled to receive pursuant to this Section shall be conclusive
absent manifest error.

(C) The Borrower shall have not more than 5 LIBOR Rate Loans in effect at any
given time. The Borrower only may exercise the LIBOR Option for LIBOR Rate Loans
of at least $1,000,000 and integral multiples of $100,000 in excess thereof.

(iii) Conversion. The Borrower may convert LIBOR Rate Loans to Reference Rate
Loans at any time; provided, however, that in the event that LIBOR Rate Loans
are converted or prepaid on any date that is not the last day of the Interest
Period applicable thereto, including as a result of any automatic prepayment
through the required application by Administrative Agent of proceeds of
Collateral in accordance with Section 4.04 or for any other reason, including
early termination of the term of this Agreement or acceleration of all or any
portion of the Obligations pursuant to the terms hereof, the Borrower shall
indemnify, defend, and hold Administrative Agent and the Lenders and their
participants harmless against any and all Funding Losses in accordance with
subsection (ii) above.

(iv) Special Provisions Applicable to LIBOR Rate.

(A) The LIBOR Rate may be adjusted by Administrative Agent with respect to any
Lender on a prospective basis to take into account any additional or increased
costs to such Lender of maintaining or obtaining any eurodollar deposits or
increased costs due to changes in applicable law occurring subsequent to the
commencement of the then applicable Interest Period, including changes in tax
laws (except changes of general applicability in corporate income tax laws) and
changes in the reserve requirements imposed by the Board of Governors of the
Federal Reserve System (or any successor), excluding the Reserve Percentage,
which additional or increased costs would increase the cost of funding loans
bearing interest at the LIBOR Rate. In any such event, the affected Lender shall
give the Borrower and Administrative Agent notice of such a determination and
adjustment and Administrative Agent promptly shall transmit the notice to each
other Lender and, upon its receipt of the notice from the affected Lender, the
Borrower may, by notice to such affected Lender (1) require such Lender to
furnish to the Borrower a statement setting forth the basis for adjusting such
LIBOR Rate and the method for determining the amount of such adjustment, or
(2) repay the LIBOR Rate Loans with respect to which such adjustment is made
(together with any amounts due under subsection (ii)(B) above).

(B) In the event that any change in market conditions or any law, regulation,
treaty, or directive, or any change therein or in the interpretation of
application thereof, shall at any time after the date hereof, in the reasonable
opinion of any Lender, make it unlawful or impractical for such Lender to fund
or maintain LIBOR Rate Loans or to continue such funding or maintaining, or to
determine or charge interest rates at the LIBOR Rate, such Lender shall give
notice of such changed circumstances to Administrative Agent and the Borrower
and Administrative Agent promptly shall transmit the notice to each other Lender
and (1) in the case of any LIBOR Rate Loans of such Lender that are outstanding,
the date specified in such Lender’s notice shall be deemed to be the last day of
the Interest Period of such LIBOR Rate Loans, and interest upon the LIBOR Rate
Loans of such Lender thereafter shall accrue interest at the rate then
applicable to Reference Rate Loans, and (2) the Borrower shall not be entitled
to elect the LIBOR Option until such Lender determines that it would no longer
be unlawful or impractical to do so.

(v) No Requirement of Matched Funding. Anything to the contrary contained herein
notwithstanding, neither Administrative Agent, nor any Lender, nor any of their
participants, is required actually to acquire eurodollar deposits to fund or
otherwise match fund any Obligation as to which interest accrues at the LIBOR
Rate. The provisions of this Section shall apply as if each Lender or its
participants had match funded any Obligation as to which interest is accruing at
the LIBOR Rate by acquiring eurodollar deposits for each Interest Period in the
amount of the LIBOR Rate Loans.

(e) Interest Payment in respect of Reference Rate Loans. Interest on each
Reference Rate Loan shall be payable monthly, in arrears, on the first day of
each month, commencing on the first day of the month following the month in
which such Loan is made and at maturity (whether upon demand, by acceleration or
otherwise). The Borrower hereby authorizes the Administrative Agent to, and the
Administrative Agent may, from time to time, charge the Loan Account pursuant to
Section 4.02 with the amount of any interest payment due hereunder.

(f) General. All interest shall be computed on the basis of a year of 360 days
for the actual number of days, including the first day but excluding the last
day, elapsed.

Section 2.05 Reduction of Commitments; Prepayment of Loans.

(a) Reduction of Commitments.

(i) Term Loan A. The Total Term Loan A Commitment shall terminate upon the
making of the Term Loan A on the Effective Date.

(ii) Term Loan B. The Total Term Loan B Commitment shall terminate upon the
earlier of (a) the making of the Term Loan B on the Term Loan B Funding Date and
(b) the expiration of the Term Loan B Funding Period.

(b) Optional Prepayment.

(i) Term Loan A. The Borrower may, upon at least 3 Business Days’ prior written
notice to the Administrative Agent, prepay the principal of the Term Loan A, in
whole or in part. Each prepayment made pursuant to this Section 2.05(b)(i) shall
be accompanied by (A) the payment of accrued interest to the date of such
payment on the amount prepaid and (B) the Prepayment Premium applicable to the
amount prepaid.

(ii) Term Loan B. The Borrower may, upon at least 3 Business Days’ prior written
notice to the Administrative Agent, prepay the principal of the Term Loan B, in
whole or in part. Each prepayment made pursuant to this Section 2.05(b)(ii)
shall be accompanied by (A) the payment of accrued interest to the date of such
payment on the amount prepaid and (B) the Prepayment Premium applicable to the
amount prepaid.

(iii) Prepayment In Full. The Borrower may, upon at least 10 days prior written
notice to the Agents, terminate this Agreement by paying to the Administrative
Agent, in cash or other immediately available funds, the Obligations in full
(other than unasserted contingent indemnification obligations) and executing and
delivering a general release in connection with such payoff. If the Borrower has
sent a notice of termination pursuant to this clause (iii), then the Lenders’
obligations to extend credit hereunder shall terminate and the Borrower shall be
obligated to repay the Obligations in full (other than unasserted contingent
indemnification obligations) and execute and deliver a general release, on the
date set forth as the date of termination of this Agreement in such notice.

(c) Mandatory Prepayment.

(i) [intentionally omitted].

(ii) The Borrower will immediately prepay the outstanding principal amount of
the Term Loans in the event that the Foothill Loan Agreement is terminated for
any reason; provided, however, that if the Indebtedness under the Foothill Loan
Agreement is refinanced by another lender or lenders, this clause (ii) shall not
require the immediate prepayment of the outstanding amount of the Term Loans so
long as (i) such refinancing is pursuant to terms and conditions that are
satisfactory to the Agents, such determination of satisfaction not to be
unreasonably withheld or delayed, (ii) such refinancing is pursuant to terms
that are not less favorable to the Loan Parties and the Lenders than the terms
of the Indebtedness owed to Foothill, (iii) such lender or lenders providing
such refinancing Indebtedness (or an agent on behalf thereof) enters into an
intercreditor agreement with Collateral Agent substantially in the form of
Exhibit I-2, (iv) after giving effect to such refinancing, the amount of such
refinancing Indebtedness is not greater than the Maximum Priority First Lien
Loan Amount, and (v) concurrent with the execution and delivery of the loan
documents relative to such refinancing, the Loan Parties execute and deliver an
acknowledgement that this clause (ii) shall thereafter be applicable with
respect to the refinancing Indebtedness.

(iii) [intentionally omitted].

(iv) [intentionally omitted].

(v) Immediately upon receipt of any proceeds of any Disposition by any Loan
Party or its Subsidiaries (other than a Permitted Disposition of the type
described in clauses (a), (d), (e) and (f) of the definition of Permitted
Dispositions), the Borrower shall prepay the outstanding principal amount of the
Loans in an amount equal to (a) 100% of the Net Cash Proceeds received by such
Person in connection with such Disposition to the extent that the aggregate
amount of Net Cash Proceeds received by all Loan Parties and their Subsidiaries
(and not paid to the Administrative Agent as a prepayment of the Loans) shall
exceed $500,000 for all such Dispositions in any Fiscal Year, minus (b) the
amount of such Net Cash Proceeds applied to the repayment of the Foothill
Indebtedness (such repayment to effect a permanent repayment of such
Indebtedness (with a commensurate and permanent reduction of the commitments
thereunder), except in any case where the prepayment results from the sale or
other disposition of a Loan Party or a division of a Loan Party and such sale
includes Accounts or Inventory of such Loan Party, in which case a portion of
the prepaid amount equal to the book value of the Accounts and Inventory
included in such sale or other disposition shall be paid against the revolving
credit facilities included in the Foothill Loan Agreement (without effecting a
permanent repayment thereof and without effecting a reduction in the commitments
thereunder) with the balance of the amount prepaid effecting a permanent
repayment of the Foothill Indebtedness (with a commensurate and permanent
reduction of the commitments thereunder). Nothing contained in this clause
(v) shall permit any Loan Party or any of its Subsidiaries to make a Disposition
of any property other than a Permitted Disposition.

(vi) Upon the issuance or incurrence by any Loan Party or any of its
Subsidiaries of any Indebtedness (other than Indebtedness referred to in
clauses (a) — (s) of the definition of Permitted Indebtedness) or the sale or
issuance by any Loan Party or any of its Subsidiaries of any shares of its
Capital Stock (exclusive of the Qualified Issuance and exclusive of amounts
received by the Loan Parties pursuant to the exercise of stock options issued to
employees of the Loan Parties pursuant to a stock option plan approved by the
Board of Directors of the Borrower and only to the extent that the Net Cash
Proceeds received therefrom do not exceed $2,000,000 during any 12 month
period), the Borrower shall prepay the Loans in an amount equal to (a) 100% of
the Net Cash Proceeds received by such Person in connection therewith, minus
(b) the amount of such Net Cash Proceeds applied to the permanent repayment of
the Foothill Indebtedness (including, in the case of amounts applied to
revolving credit facilities, a permanent reduction in the commitments
thereunder). The provisions of this subsection (vi) shall not be deemed to be
implied consent to any such issuance, incurrence or sale otherwise prohibited by
the terms and conditions of this Agreement.

(vii) Upon the receipt by any Loan Party or any of its Subsidiaries of any
Extraordinary Receipts, the Borrower shall prepay the outstanding principal of
the Loans in an amount equal to (a) 100% of such Extraordinary Receipts, net of
any reasonable expenses incurred in collecting such Extraordinary Receipts,
minus (b) the amount of such Net Cash Proceeds applied to the permanent
repayment of the Foothill Indebtedness (including, in the case of amounts
applied to revolving credit facilities, a permanent reduction in the commitments
thereunder).

(d) Application of Payments.

(i) Each prepayment made pursuant to subsections (c)(v), (c)(vi), and (c)(vii)
above shall be applied, on a pro-rata basis, to the Term Loan B and to the Term
Loan A.

(ii) The foregoing to the contrary notwithstanding, Borrower shall not be
required to make a prepayment otherwise required pursuant to Section 2.05(c)(v)
or Section 2.05(c)(vi) with Reinvestment Eligible Funds so long as: (A) no
Default or Event of Default has occurred and is continuing on the date such
Person receives such Reinvestment Eligible Funds or on the date such amounts are
to be released to Borrower pursuant to this Section 2.05(d)(ii), (B) the
Borrower delivers a notice (a “Reinvestment Notice”) on or prior to the date
that the applicable Person receives the monies constituting such Reinvestment
Eligible Funds notifying the Agents of the intent of the applicable Person to
use such Reinvestment Eligible Funds (1) to repair, restore, or replace the
assets that were the subject of the Disposition, casualty or condemnation giving
rise to such amounts with assets of equal or greater fair market value which
will be useful in the conduct of their business in accordance with past
practice, (2) within the period specified in such notice, which period shall not
exceed the earlier of (x) 180 days after the receipt of such Reinvestment
Eligible Funds by the applicable Loan Party or its Subsidiary and (y) the Final
Maturity Date, and (C) pending the reinvestment described in clause (B)(1)
above, such Reinvestment Eligible Amounts are deposited in a cash collateral
account over which Collateral Agent (on behalf of the Lenders) has a perfected
second (junior only to Foothill) priority Lien. If all or any portion of such
Reinvestment Eligible Funds are not used in accordance with the preceding
sentence within the period specified in the Reinvestment Notice, the remaining
portion shall be applied to the Loans in accordance with Section 2.05(d) on the
last day of such specified period.

(e) Interest and Fees. Any prepayment made pursuant to this Section 2.05 shall
be accompanied by the payment of accrued interest on the principal amount being
prepaid to the date of prepayment, and if such prepayment would reduce the
amount of the outstanding Loans to zero, such prepayment shall be accompanied by
the payment of all fees accrued to such date pursuant to Section 2.06.

(f) Cumulative Prepayments. Except as otherwise expressly provided in this
Section 2.05, payments with respect to any subsection of this Section 2.05 are
in addition to payments made or required to be made under any other subsection
of this Section 2.05.

Section 2.06 Fees.

(a) Closing Fees.

(i) On the Effective Date, the Borrower shall pay to the Administrative Agent
for the account of the Lenders, in accordance with their Pro Rata Shares, a
non-refundable closing fee with respect to the Term Loan A (the “Term Loan A
Closing Fee”) in an amount equal to $640,000.

(ii) On the Term Loan B Funding Date, the Borrower shall pay to the
Administrative Agent for the account of the Lenders, in accordance with their
Pro Rata Shares, a non-refundable closing fee with respect to the Term Loan B
(the “Term Loan B Closing Fee”) in an amount equal to $360,000.

(b) Loan Servicing Fee. From and after the Effective Date and until the later of
(i) the Final Maturity Date and (ii) the date on which all Obligations are paid
in full, the Borrower shall pay to the Administrative Agent for the account of
the Collateral Agent, a non-refundable loan servicing fee (the “Loan Servicing
Fee”) equal to $4,200 each month, which shall be payable on the Effective Date
(payable ratably based on the number of days remaining in the calendar month in
which the Effective Date occurs) and monthly in advance thereafter on the first
day of each calendar month commencing on August 1, 2007.

Section 2.07 Securitization. The Borrower hereby acknowledges that the Lenders
and their Affiliates may sell or securitize the Loans (a “Securitization”)
through the pledge of the Loans as collateral security for loans to the Lenders
or their Affiliates or through the sale of the Loans or the issuance of direct
or indirect interests in the Loans, which loans to the Lenders or their
Affiliates or direct or indirect interests will be rated by Moody’s, Standard &
Poor’s or one or more other rating agencies (the “Rating Agencies”). The
Borrower shall cooperate with the Lenders and their Affiliates to effect the
Securitization including by (a) amending this Agreement and the other Loan
Documents, and executing such additional documents, as reasonably requested by
the Lenders in connection with the Securitization, provided that (i) any such
amendment or additional documentation does not impose material additional costs
on the Borrower and (ii) any such amendment or additional documentation does not
materially adversely affect the rights, or materially increase the obligations,
of the Borrower under the Loan Documents or change or affect in a manner adverse
to the Borrower the financial terms of the Loans, (b) providing such information
as may be reasonably requested by the Lenders in connection with the rating of
the Loans or the Securitization, and (c) providing in connection with any rating
of the Loans a certificate (i) agreeing to indemnify the Lenders and their
Affiliates, any of the Rating Agencies, or any party providing credit support or
otherwise participating in the Securitization (collectively, the “Securitization
Parties”) for any losses, claims, damages or liabilities (the “Liabilities”) to
which the Lenders, their Affiliates or such Securitization Parties may become
subject insofar as the Liabilities arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in any Loan
Document or in any writing delivered by or on behalf of any Loan Party to any
Agent or Lender in connection with any Loan Document or arise out of or are
based upon the omission or alleged omission to state therein a material fact
required to be stated therein, or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading, and such indemnity shall survive any transfer by the Lenders or
their successors or assigns of the Loans and (ii) agreeing to reimburse the
Agents, the Lenders and their Affiliates for any legal or other expenses
reasonably incurred by such Persons in connection with defending the
Liabilities.

Section 2.08 Taxes.  

(a) Any and all payments by any Loan Party hereunder or under any other Loan
Document shall be made free and clear of and without deduction for any and all
present or future taxes, levies, imposts, deductions, charges or withholdings,
and all liabilities with respect thereto, excluding taxes imposed on the net
income of any Agent or any Lender (or any transferee or assignee thereof,
including a participation holder (any such entity, a “Transferee”)) by the
jurisdiction in which such Person is organized or has its principal lending
office (all such nonexcluded taxes, levies, imposts, deductions, charges
withholdings and liabilities, collectively or individually, “Taxes”). If any
Loan Party shall be required to deduct any Taxes from or in respect of any sum
payable hereunder to any Agent or any Lender (or any Transferee), (i) the sum
payable shall be increased by the amount (an “additional amount”) necessary so
that after making all required deductions (including deductions applicable to
additional sums payable under this Section 2.08) such Agent or such Lender (or
such Transferee) shall receive an amount equal to the sum it would have received
had no such deductions been made, (ii) such Loan Party shall make such
deductions and (iii) such Loan Party shall pay the full amount deducted to the
relevant Governmental Authority in accordance with applicable law.

(b) In addition, each Loan Party agrees to pay to the relevant Governmental
Authority in accordance with applicable law any present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies that arise from any payment made hereunder or from the execution,
delivery or registration of, or otherwise with respect to, this Agreement or any
other Loan Document (“Other Taxes”). Each Loan Party shall deliver to each Agent
and each Lender official receipts in respect of any Taxes or Other Taxes payable
hereunder promptly after payment of such Taxes or Other Taxes.

(c) The Loan Parties hereby jointly and severally indemnify and agree to hold
each Agent and each Lender harmless from and against Taxes and Other Taxes
(including, Taxes and Other Taxes imposed on any amounts payable under this
Section 2.08) paid by such Person, whether or not such Taxes or Other Taxes were
correctly or legally asserted. Such indemnification shall be paid within 10 days
from the date on which any such Person makes written demand therefore specifying
in reasonable detail the nature and amount of such Taxes or Other Taxes.

(d) Each Lender that is organized under the laws of a jurisdiction outside the
United States (a “Non-U.S. Lender”) agrees that it shall, no later than the
Effective Date (or, in the case of a Lender which becomes a party hereto
pursuant to Section 12.07 after the Effective Date, promptly after the date upon
which such Lender becomes a party hereto) deliver to the Agents (or, in the case
of a participant, to the Lender granting the participation only) a properly
completed and duly executed copy of either U.S. Internal Revenue Service Form
W-8BEN, W-8ECI or W-8IMY or any subsequent versions thereof or successors
thereto, in each case claiming complete exemption from, or reduced rate of, U.S.
Federal withholding tax and payments of interest hereunder. In addition, in the
case of a Non-U.S. Lender claiming exemption from U.S. Federal withholding tax
under Section 871(h) or 881(c) of the Internal Revenue Code, such Non-U.S.
Lender hereby represents to the Agents and the Borrower that such Non-U.S.
Lender is not a bank for purposes of Section 881(c) of the Internal Revenue
Code, is not a 10-percent shareholder (within the meaning of
Section 871(h)(3)(B) of the Internal Revenue Code) of the Borrower and is not a
controlled foreign corporation related to the Borrower (within the meaning of
Section 864(d)(4) of the Internal Revenue Code), and such Non-U.S. Lender agrees
that it shall promptly notify the Agents in the event any such representation is
no longer accurate. Such forms shall be delivered by each Non-U.S. Lender on or
before the date it becomes a party to this Agreement and on or before the date,
if any, such Non-U.S. Lender changes its applicable lending office by
designating a different lending office (a “New Lending Office”). In addition,
such Non-U.S. Lender shall deliver such forms within 20 days after receipt of a
written request therefor from any Agent, the assigning Lender or the Lender
granting a participation, as applicable. Notwithstanding any other provision of
this Section 2.08, a Non-U.S. Lender shall not be required to deliver any form
pursuant to this Section 2.08(d) that such Non-U.S. Lender is not legally able
to deliver.

(e) The Loan Parties shall not be required to indemnify any Non-U.S. Lender, or
pay any additional amounts to any Non-U.S. Lender, in respect of United States
Federal withholding tax pursuant to this Section 2.08 to the extent that (i) the
obligation to withhold amounts with respect to United States Federal withholding
tax existed on the date such Non-U.S. Lender became a party to this Agreement
(or, in the case of a Transferee that is a participation holder, on the date
such participation holder became a Transferee hereunder) or, with respect to
payments to a New Lending Office, the date such Non-U.S. Lender designated such
New Lending Office with respect to a Loan; provided, however, that this clause
(i) shall not apply to the extent the indemnity payment or additional amounts
any Transferee, or Lender (or Transferee) through a New Lending Office, would be
entitled to receive (without regard to this clause (i)) do not exceed the
indemnity payment or additional amounts that the Person making the assignment,
participation or transfer to such Transferee, or Lender (or Transferee) making
the designation of such New Lending Office, would have been entitled to receive
in the absence of such assignment, participation, transfer or designation, or
(ii) the obligation to pay such additional amounts would not have arisen but for
a failure by such Non-U.S. Lender to comply with the provisions of clause
(d) above.

(f) The obligations of the Loan Parties under this Section 2.08 shall survive
the termination of this Agreement and the payment of the Loans and all other
amounts payable hereunder.

ARTICLE III

[INTENTIONALLY OMITTED]

ARTICLE IV

FEES, PAYMENTS AND OTHER COMPENSATION

Section 4.01 Audit and Collateral Monitoring Fees. The Borrower acknowledges
that pursuant to Section 7.01(f), representatives of the Agents may visit any
Loan Party or conduct audits, inspections or field examinations of any Loan
Party and valuations or appraisals of any or all of the Collateral or business
or enterprise valuations of the Loan Parties at any time and from time to time
in a manner so as to not unduly disrupt the business of such Loan Party. The
Borrower agrees to pay (i) $1,000 per day per examiner plus the examiner’s
out-of-pocket costs and reasonable expenses incurred in connection with all such
visits, audits, inspections, valuations, and field examinations and (ii) the
cost of all audits, appraisals and business valuations (including enterprise
valuation appraisals) conducted by third party auditors or appraisers on behalf
of the Agents.

Section 4.02 Payments; Computations and Statements.

(a) The Borrower will make each payment under this Agreement not later than
12:00 noon (New York City time) on the day when due, in lawful money of the
United States of America and in immediately available funds, to the
Administrative Agent’s Account. All payments received by the Administrative
Agent after 12:00 noon (New York City time) on any Business Day will be credited
to the Loan Account on the next succeeding Business Day. All payments shall be
made by the Borrower without set-off, counterclaim, deduction or other defense
to the Agents and the Lenders. Except as provided in Section 2.02, after
receipt, the Administrative Agent will promptly thereafter cause to be
distributed like funds relating to the payment of principal ratably to the
Lenders in accordance with their Pro Rata Shares and like funds relating to the
payment of any other amount payable to any Lender to such Lender, in each case
to be applied in accordance with the terms of this Agreement, provided that the
Administrative Agent will cause to be distributed all interest and fees received
from or for the account of the Borrower not less than once each month and in any
event promptly after receipt thereof. The Lenders and the Borrower hereby
authorize the Administrative Agent to, and the Administrative Agent shall, from
time to time, charge the Loan Account of the Borrower with any amount due and
payable by the Borrower under any Loan Document. Each of the Lenders and the
Borrower agrees that the Administrative Agent shall have the right to make such
charges whether or not any Default or Event of Default shall have occurred and
be continuing or whether any of the conditions precedent in Section 5.02 have
been satisfied. Any amount charged to the Loan Account of the Borrower shall be
deemed a Loan hereunder funded by the Administrative Agent on behalf of the
Lenders and subject to Section 2.02 of this Agreement. The Lenders and the
Borrowers confirm that any charges which the Administrative Agent may so make to
the Loan Account of the Borrowers as herein provided will be made as an
accommodation to the Borrowers and solely at the Administrative Agent’s
discretion, provided that the Administrative Agent shall from time to time upon
the request of the Collateral Agent, charge the Loan Account of the Borrowers
with any amount due and payable under any Loan Document. Whenever any payment to
be made under any such Loan Document 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 interest or fees, as the case may be. All computations of fees shall be made
by the Administrative Agent on the basis of a year of 360 days for the actual
number of days (including the first day but excluding the last day) occurring in
the period for which such fees are payable. Each determination by the
Administrative Agent of an interest rate or fees hereunder shall be conclusive
and binding for all purposes in the absence of manifest error.

(b) The Administrative Agent shall provide the Borrower, promptly after the end
of each calendar month, a summary statement (in the form from time to time used
by the Administrative Agent) of the opening and closing daily balances in the
Loan Account of the Borrower during such month, the amounts and dates of all
Loans made to the Borrower during such month, the amounts and dates of all
payments on account of the Loans to the Borrower during such month and the Loans
to which such payments were applied, the amount of interest accrued on the Loans
to the Borrower during such month, the amount of charges to the Loan Account,
and the amount and nature of any charges to the Loan Account made during such
month on account of fees, commissions, expenses and other Obligations. All
entries on any such statement shall be presumed to be correct and, 30 days after
the same is sent, shall be final and conclusive absent manifest error.

Section 4.03 Sharing of Payments, Etc. Except as provided in Section 2.02
hereof, if any Lender shall obtain any payment (whether voluntary, involuntary,
through the exercise of any right of set-off, or otherwise) on account of any
Obligation in excess of its ratable share of payments on account of similar
obligations obtained by all the Lenders, such Lender shall forthwith purchase
from the other Lenders such participations in such similar obligations held by
them as shall be necessary to cause such purchasing Lender to share the excess
payment ratably with each of them; provided, however, that if all or any portion
of such excess payment is thereafter recovered from such purchasing Lender, such
purchase from each Lender shall be rescinded and such Lender shall repay to the
purchasing Lender the purchase price to the extent of such recovery together
with an amount equal to such Lender’s ratable share (according to the proportion
of (i) the amount of such Lender’s required repayment to (ii) the total amount
so recovered from the purchasing Lender of any interest or other amount paid by
the purchasing Lender in respect of the total amount so recovered). The Borrower
agrees that any Lender so purchasing a participation from another Lender
pursuant to this Section 4.03 may, to the fullest extent permitted by law,
exercise all of its rights (including the Lender’s right of set-off) with
respect to such participation as fully as if such Lender were the direct
creditor of the Borrower in the amount of such participation.

Section 4.04 Apportionment of Payments.  Subject to Section 2.02 hereof and to
any written agreement among the Agents or the Lenders:

(a) all payments of principal and interest in respect of outstanding Loans, all
payments of fees (other than the audit and collateral monitoring fees provided
for in Section 4.01) and all other payments in respect of any other Obligations,
shall be allocated by the Administrative Agent among such of the Lenders as are
entitled thereto, in proportion to their respective Pro Rata Shares or otherwise
as provided herein or, in respect of payments not made on account of Loans as
designated by the Person making payment when the payment is made.

(b) After the occurrence and during the continuance of an Event of Default, the
Administrative Agent may, and upon the direction of the Required Lenders shall,
apply all payments in respect of any Obligations and all proceeds of the
Collateral, subject to the provisions of this Agreement, (i) first, ratably to
pay the Obligations in respect of any fees, expense reimbursements, indemnities
and other amounts then due to the Agents until paid in full; (ii) second,
ratably to pay interest due in respect of the Collateral Agent Advances until
paid in full; (iii) third, ratably to pay principal of the Collateral Agent
Advances until paid in full; (iv) fourth, ratably to pay any fees and
indemnities then due to the Term Loan Lenders until paid in full; (v) fifth,
ratably to pay interest due in respect of the Term Loans until paid in full;
(vi) sixth, ratably to pay principal of the Term Loans until paid in full, and
(vii) seventh, to the ratable payment of all other Obligations then due and
payable until paid in full.

(c) In each instance, so long as no Event of Default has occurred and is
continuing, Section 4.04(b) shall not be deemed to apply to any payment by the
Borrower specified by the Borrower to the Administrative Agent to be for the
payment of Term Loan A Obligations or Term Loan B Obligations, as applicable,
then due and payable under any provision of this Agreement or the prepayment of
all or part of the principal of the Term Loans in accordance with the terms and
conditions of Section 2.05.

(d) For purposes of Section 4.04(b), (other than clause (vii) thereof) “paid in
full” means with respect to any Obligations, payment of all amounts owing under
the Loan Documents in respect of such Obligations, including fees, interest,
default interest, interest on interest, expense reimbursements and indemnities,
specifically including in each case any of the foregoing which would accrue
after the commencement of any Insolvency Proceeding irrespective of whether a
claim is allowable in such Insolvency Proceeding, except to the extent that
default or overdue interest (but not any other interest) and fees, each arising
from or related to a default, are disallowed in any Insolvency Proceeding;
provided, however, that for purposes of such clause (vii), “paid in full” means
with respect to any Obligations, payment of all amounts owing under the Loan
Documents in respect of such Obligations, including fees, interest, default
interest, interest on interest, expense reimbursements and indemnities,
specifically including in each case any of the foregoing which would accrue
after the commencement of any Insolvency Proceeding irrespective of whether a
claim is allowable in such Insolvency Proceeding.

(e) In the event of a direct conflict between the priority provisions of this
Section 4.04 and other provisions contained in any other Loan Document, it is
the intention of the parties hereto that both such priority provisions in such
documents shall be read together and construed, to the fullest extent possible,
to be in concert with each other. In the event of any actual, irreconcilable
conflict that cannot be resolved as aforesaid, the terms and provisions of this
Section 4.04 shall control and govern.

Section 4.05 Increased Costs and Reduced Return.  (a)  If any Lender or any
Agent shall have determined that the adoption or implementation of, or any
change in, any law, rule, treaty or regulation, or any policy, guideline or
directive of, or any change in, the interpretation or administration thereof by,
any court, central bank or other administrative or Governmental Authority, or
compliance by any Lender or any Agent or any Person controlling any such Lender
or any such Agent with any directive of, or guideline from, any central bank or
other Governmental Authority or the introduction of, or change in, any
accounting principles applicable to any Lender, any Agent or any Person
controlling any such Lender, any such Agent (in each case, whether or not having
the force of law) (each, a “Change in Law”), shall (i) subject any Lender, any
Agent or any Person controlling any such Lender or any such Agent to any tax,
duty or other charge with respect to this Agreement or any Loan made by such
Lender or such Agent or change the basis of taxation of payments to any Lender,
any Agent or any Person controlling any such Lender or any such Agent of any
amounts payable hereunder (except for taxes on the overall net income of any
Lender, any Agent or any Person controlling any such Lender or any such Agent),
(ii) impose, modify or deem applicable any reserve, special deposit or similar
requirement against any Loan, or against assets of or held by, or deposits with
or for the account of, or credit extended by, any Lender, any Agent or any
Person controlling any such Lender or any such Agent or (iii) impose on any
Lender, any Agent or any Person controlling any such Lender or any such Agent
any other condition regarding this Agreement or any Loan, and the result of any
event referred to in clauses (i), (ii) or (iii) above shall be to increase the
cost to any Lender or any Agent of making any Loan, or agreeing to make any Loan
or to reduce any amount received or receivable by any Lender or any Agent
hereunder, then, upon demand by any such Lender or any such Agent, the Borrower
shall pay to such Lender or such Agent such additional amounts as will
compensate such Lender, or such Agent for such increased costs or reductions in
amount.

(b) If any Lender or any Agent shall have determined that any Change in Law
either (i) affects or would affect the amount of capital required or expected to
be maintained by any Lender, any Agent or any Person controlling such Lender or
such Agent and any Lender or any Agent determines that the amount of such
capital is increased as a direct or indirect consequence of any Loans made or
maintained, any Lender’s, any Agent’s or any such other controlling Person’s
other obligations hereunder, or (ii) has or would have the effect of reducing
the rate of return on any Lender’s or any Agent’s any such other controlling
Person’s capital to a level below that which such Lender, such Agent or such
controlling Person could have achieved but for such circumstances as a
consequence of any Loans made or maintained, or any agreement to make Loans, or
such Lender’s, such Agent’s or such other controlling Person’s other obligations
hereunder (in each case, taking into consideration, such Lender’s, or such
Agent’s or such other controlling Person’s policies with respect to capital
adequacy), then, upon demand by any Lender or any Agent, the Borrower shall pay
to such Lender or such Agent from time to time such additional amounts as will
compensate such Lender or such Agent for such cost of maintaining such increased
capital or such reduction in the rate of return on such Lender’s or such Agent’s
or such other controlling Person’s capital.

(c) All amounts payable under this Section 4.05 shall bear interest from the
date that is ten (10) days after the date of demand by any Lender or any Agent
until payment in full to such Lender or such Agent at the Reference Rate. A
certificate of such Lender or such Agent claiming compensation under this
Section 4.05, specifying the event herein above described and the nature of such
event shall be submitted by such Lender or such Agent to the Borrower, setting
forth the additional amount due and an explanation of the calculation thereof,
and such Lender’s or such Agent’s reasons for invoking the provisions of this
Section 4.05, and shall be final and conclusive absent manifest error.

ARTICLE V

CONDITIONS TO LOANS

Section 5.01 Conditions Precedent. The obligation of any Lender to make the Term
Loan A (or any other Person to otherwise extend any credit provided for
hereunder), is subject to the fulfillment, to the satisfaction of each Lender
(the making of the Term Loan A by any Lender being conclusively deemed to be its
satisfaction or waiver of the following), of each of the conditions precedent
set forth below:

(a) Payment of Fees, Etc. The Borrower shall have paid all fees, costs, expenses
and taxes then payable pursuant to Sections 2.06 or 12.04.

(b) Representations and Warranties; No Event of Default. The following
statements shall be true and correct: (i) the representations and warranties
contained in Article VI and in each other Loan Document, certificate or other
writing delivered to any Agent or any Lender pursuant hereto or thereto on or
prior to the Effective Date are true and correct in all material respects
(except that such materiality qualifier shall not be applicable to any
representations and warranties that already are qualified or modified by
materiality in the text thereof) on and as of the Effective Date as though made
on and as of such date (it being understood and agreed that any representation
or warranty which by its terms is made as of a specified date shall be required
to be true and correct in all material respects only as of such specified date)
and (ii) no Default or Event of Default shall have occurred and be continuing on
the Effective Date or would result from this Agreement or the other Loan
Documents becoming effective in accordance with its or their respective terms.

(c) Legality. The making of the Term Loan A shall not contravene any law, rule
or regulation applicable to any Agent or any Lender.

(d) Delivery of Documents. The Collateral Agent shall have received on or before
the Effective Date the following, each in form and substance satisfactory to the
Collateral Agent and, unless indicated otherwise, dated the Effective Date:

(i) a Security Agreement, duly executed by each Loan Party, together with the
original stock certificates representing all of the Capital Stock owned by each
Loan Party and all promissory notes of each Loan Party, accompanied by undated
stock powers executed in blank and other proper instruments of transfer
(provided that this clause (i) may be satisfied by delivering such certificates,
notes, powers and other instruments to Foothill, so long as the Collateral Agent
shall have received undated original stock powers executed in blank, in form and
substance reasonably satisfactory to the Collateral Agent, for all such stock
certificates that have been delivered to Foothill);

(ii) the Term Loan A Funds Flow Agreement, duly executed by each Loan Party,

(iii) the Intercompany Subordination Agreement, duly executed by each Loan
Party;

(iv) the Intercreditor Agreement, duly executed by each of the parties thereto;

(v) the Niagara Subordination Agreement, duly executed by each of the parties
thereto;

(vi) a Filing Authorization Letter, duly executed by each Loan Party, together
with appropriate financing statements duly filed in such office or offices as
may be necessary or, in the opinion of the Collateral Agent, desirable to
perfect the security interests purported to be created by each Security
Agreement;

(vii) certified copies of all effective financing statements which name as
debtor any Loan Party and which are filed in the offices referred to in
clause (vii) above, together with copies of such financing statements, none of
which, except as otherwise agreed in writing by the Collateral Agent, shall
cover any of the Collateral and the results of searches for any tax Lien and
judgment Lien filed against such Person or its property, which results, except
as otherwise agreed to in writing by the Collateral Agent, shall not show any
such Liens;

(viii) a copy of the resolutions of each Loan Party, certified as of the
Effective Date by an Authorized Officer thereof, authorizing (A) the
transactions contemplated by the Loan Documents to which such Loan Party is or
will be a party, and (B) the execution, delivery and performance by such Loan
Party of each Loan Document to which such Loan Party is or will be a party and
the execution and delivery of the other documents to be delivered by such Person
in connection herewith and therewith;

(ix) a certificate of an Authorized Officer of each Loan Party, certifying the
names and true signatures of the representatives of such Loan Party authorized
to sign each Loan Document to which such Loan Party is or will be a party and
the other documents to be executed and delivered by such Loan Party in
connection herewith and therewith, together with evidence of the incumbency of
such authorized officers;

(x) a certificate of the appropriate official(s) of the state of organization
and each state of foreign qualification of each Loan Party certifying as to the
subsistence in good standing of, and the payment of taxes by, such Loan Party in
such states;

(xi) a true and complete copy of the charter, certificate of formation,
certificate of limited partnership or other publicly filed organizational
document of each Loan Party certified as of a recent date not more than 45 days
prior to the Effective Date by an appropriate official of the state of
organization of such Loan Party which shall set forth the same complete name of
such Loan Party as is set forth herein and the organizational number of such
Loan Party, if an organized number is issued in such jurisdiction;

(xii) a copy of the charter and by-laws, limited liability company agreement,
operating agreement, agreement of limited partnership or other organizational
document of each Loan Party, together with all amendments thereto, certified as
of the Effective Date by an Authorized Officer of such Loan Party;

(xiii) an opinion of Lowenstein Sandler, PC, counsel to the Loan Parties, and of
local counsel to the Loan Parties in such jurisdictions as the Collateral Agent
may reasonably request, each in form and substance reasonably satisfactory to
the Collateral Agent;

(xiv) a certificate of an Authorized Officer of each Loan Party, certifying as
to the matters set forth in Section 5.01(b);

(xv) a copy of the Financial Statements, together with a certificate of an
Authorized Officer of the Borrower setting forth all existing Indebtedness,
pending or threatened litigation or claims and other contingent liabilities of
the Borrower and its Subsidiaries;

(xvi) a copy of the financial projections described in Section 6.01(g)(ii)
hereof, which projections shall be satisfactory in form and substance to the
Agents;

(xvii) a certificate of the chief financial officer of the Borrower, setting
forth in reasonable detail the calculations required to establish compliance, on
a pro forma basis after giving effect to the consummation of the Annaco
Acquisition, with each of the financial covenants contained in Section 7.03;

(xviii) a certificate of the chief financial officer of the Borrower, certifying
as to the solvency of each Loan Party, which certificate shall be satisfactory
in form and substance to the Collateral Agent;

(xix) evidence of the insurance coverage required by Section 7.01 and the terms
of each Security Agreement and such other insurance coverage with respect to the
business and operations of the Loan Parties as the Collateral Agent may
reasonably request, in each case, where requested by the Collateral Agent, with
such endorsements as to the named insureds or loss payees thereunder as the
Collateral Agent may request and providing that such policy may be terminated or
canceled (by the insurer or the insured thereunder) only upon 30 days prior
written notice (or, in the case of termination or cancellation for non-payment
of premium, 10 days prior written notice) to the Collateral Agent and each such
named insured or loss payee;

(xx) a certificate of an Authorized Officer of the Borrower, certifying the
names and true signatures of the persons that are authorized to provide Notices
of Borrowing and all other notices under this Agreement and the other Loan
Documents;

(xxi) a landlord waiver, in form and substance satisfactory to the Collateral
Agent and which may be included as a provision contained in the relevant Lease,
executed by each landlord with respect to each of the locations identified as
leased locations on Schedule 6.01(o) (except as contemplated under
Section 5.03(c) below);

(xxii) a collateral access agreement, in form and substance satisfactory to the
Collateral Agent, executed by each Person who possesses Inventory of any Loan
Party;

(xxiii) environmental reviews of each Facility, in form and substance, and by an
independent firm, satisfactory to the Collateral Agent in its sole discretion;

(xxiv) copies of (a) the Annaco Acquisition Documents, and (b) the other
Material Contracts as in effect on the Effective Date, certified as true and
correct copies thereof by an Authorized Officer of the Borrower, together with a
certificate of an Authorized Officer of the Borrower stating that such
agreements remain in full force and effect and that none of the Loan Parties has
breached or defaulted in any of its obligations under such agreements;

(xxv) the Borrower shall have received all material licenses, approvals or
evidence of other actions required by any Governmental Authority (including
under HSR if applicable) in connection with the execution and delivery by the
Borrower of the Annaco Acquisition Documents and with the consummation of the
transactions contemplated thereby; and

(xxvi) such other agreements, instruments, approvals, opinions and other
documents, each satisfactory to the Collateral Agent in form and substance, as
the Collateral Agent may reasonably request.

(e) Material Adverse Effect. The Collateral Agent shall have determined, in its
sole judgment, that no event or development shall have occurred since
December 31, 2006, which could reasonably be expected to result in a Material
Adverse Effect.

(f) Consummation of Annaco Acquisition. Concurrently with the making of the Term
Loan A, (i) the Borrower shall have purchased, pursuant to the Annaco
Acquisition Agreement (no provision of which shall have been amended or
otherwise modified or waived without the prior written consent of the Agents),
and shall have become the owner, free and clear of all Liens other than
Permitted Liens, of substantially all of the assets of Annaco for a Purchase
Price not in excess of $35,600,000 in cash or other immediately available funds
(subject to a working capital adjustment) and the Annaco Earn-Out Arrangements,
(ii) the proceeds of the Term Loan A shall have been applied (together with
other funds of the Borrower and its Subsidiaries) to pay the Purchase Price
payable pursuant to the Annaco Acquisition Agreement for substantially all of
the assets of Annaco and the closing and other costs relating thereto.

(g) Proceedings; Receipt of Documents. All proceedings in connection with the
making of the Term Loan A and the other transactions contemplated by this
Agreement and the other Loan Documents, and all documents incidental hereto and
thereto, shall be satisfactory to the Collateral Agent and its counsel, and the
Collateral Agent and such counsel shall have received all such information and
such counterpart originals or certified or other copies of such documents as the
Collateral Agent or such counsel may reasonably request.

(h) Management Reference Checks. The Collateral Agent shall have received
satisfactory reference checks for key management of each Loan Party.

(i) Due Diligence. The Agents shall have completed their business and legal due
diligence with respect to each Loan Party and the results thereof shall be
acceptable to the Agents, in their sole and absolute discretion.

(j) Availability. After giving effect to Term Loan A to be made on the Effective
Date and the consummation of the Annaco Acquisition, the sum of Availability
plus Qualified Cash shall not be less than $5,000,000. The Borrower shall
deliver to the Collateral Agent a certificate of the chief financial officer of
the Borrower certifying as to the calculation of Availability.

(k) Loans on Effective Date. The aggregate amount of the Term Loan A to be made
on the Effective Date shall not exceed 2.1 times TTM EBITDA for the most
recently completed 12 month period set forth in the Financial Statements after
giving pro forma effect to the Annaco Acquisition.

(l) Notices. The Administrative Agent shall have received a Notice of Borrowing
pursuant to Section 2.02 hereof.

Section 5.02 Conditions Precedent to Term Loan B Funding Date. The obligation of
any Lender to make the Term Loan B on the Term Loan B Funding Date is subject to
the fulfillment, to the satisfaction of each Lender (the making of the Term Loan
B by any Lender being conclusively deemed to be satisfaction or waiver of the
following), of each of the conditions precedent set forth below:

(a) Payment of Fees, Etc. The Borrower shall have paid all fees, costs, expenses
and taxes then payable by the Borrower pursuant to this Agreement and the other
Loan Documents, including Sections 2.06 and 12.04 hereof.

(b) Representations and Warranties; No Event of Default. The following
statements shall be true and correct: (i) the representations and warranties
contained in Article VI and in each other Loan Document, certificate or other
writing delivered to any Agent or any Lender pursuant hereto or thereto on or
prior to the Term Loan B Funding Date are true and correct in all material
respects (except that such materiality qualifier shall not be applicable to any
representations and warranties that already are qualified or modified by
materiality in the text thereof) on and as of the Term Loan B Funding Date as
though made on and as of such date (it being understood and agreed that any
representation or warranty which by its terms is made as of a specified date
shall be required to be true and correct in all material respects only as of
such specified date) and (ii) no Default or Event of Default has occurred and is
continuing on the Term Loan B Funding Date or would result from the making of
the Term Loan B in accordance with the terms hereof.

(c) Legality. The making of the Term Loan B shall not contravene any law, rule
or regulation applicable to any Agent or any Lender.

(d) Delivery of Documents. The Collateral Agent shall have received on or before
the Term Loan B Funding Date the following, each in form and substance
satisfactory to the Collateral Agent and, unless indicated otherwise, dated the
Term Loan B Funding Date:

(i) the Term Loan B Funds Flow Agreement, duly executed by each Loan Party;

(ii) a certificate of an Authorized Officer of each Loan Party, certifying as to
the matters set forth in Section 5.02(b);

(iii) copies of the Totalcat Acquisition Documents, in form and substance
satisfactory to the Agents;

(iv) an opinion of Lowenstein Sandler PC, counsel to the Loan Parties in
connection with the Totalcat Acquisition, and of local counsel to the Loan
Parties in such jurisdictions as the Collateral Agent may reasonably request, in
each case as to such matters as the Collateral Agent may reasonably request;

(v) a certificate of the chief financial officer of the Borrower, setting forth
updated pro forma projections for the Borrower and its Subsidiaries
demonstrating compliance on a pro forma basis with Section 7.03 for the period
from the Term Loan B Funding Date through December 31, 2007, in form and content
reasonably acceptable to the Agents;

(vi) a certificate of the chief financial officer of the Borrower, certifying as
to the solvency of each Loan Party, which certificate shall be satisfactory in
form and substance to the Collateral Agent;

(vii) a landlord waiver, in form and substance satisfactory to the Collateral
Agent and which may be included as a provision contained in the relevant Lease,
executed by each landlord with respect to each of the leased locations acquired
in connection with the Totalcat Acquisition;

(viii) a collateral access agreement, in form and substance satisfactory to the
Collateral Agent, executed by each Person who possesses Inventory of any Loan
Party;

(ix) a certificate of an Authorized Officer of the Borrower certifying that the
subject Capital Stock in the Totalcat Acquisition is being acquired directly by
a Loan Party or by a wholly-owned direct Subsidiary of Borrower and that each
entity being acquired in connection with the Totalcat Acquisition is organized
and located within the United States;

(x) written confirmation supported by reasonably detailed calculations, that
(1) the operations conducted by Totalcat had positive Consolidated EBITDA for
the most recently completed 12 month period for which financial statements are
available, and (2) on a pro forma basis, created by adding the historical
combined financial statements of the Borrower to the historical consolidated
financial statements of the operations conducted by Totalcat, the Borrower would
have been in compliance with the financial covenants in Section 7.03 for the
12 months ending as of the month ended immediately prior to the proposed date of
consummation of the Totalcat Acquisition for which there are available financial
statements;

(xi) (A) a pledge agreement respecting the Capital Stock of any wholly-owned
Subsidiary that is formed to participate in the Totalcat Acquisition or that is
acquired in connection with the Totalcat Acquisition, (B) possession of the
original stock certificates respecting all of the issued and outstanding shares
of Capital Stock of each such Person, together with stock powers with respect
thereto endorsed in blank (provided that this clause may be satisfied by
delivering such documents to Foothill for so long as the Foothill Loan Agreement
is in existence, so long as the Collateral Agent shall have received undated
original stock powers executed in blank, in form and substance reasonably
satisfactory to the Collateral Agent, for all such stock certificates that have
been delivered to Foothill), (C) a joinder agreement executed by each such
Subsidiary and each of its Subsidiaries pursuant to which each such Subsidiary
and each of its Subsidiaries joins this Agreement as a Guarantor, and (iv) such
other Loan Documents as are necessary to obtain an enforceable and perfected
second priority (subject to Permitted Liens) Lien upon all or substantially all
of the property and assets of each such Subsidiary and each of its Subsidiaries;

(xii) (A) a quality of earnings report from a third party reasonably acceptable
to the Agents, (B) an environmental report from a third party reasonably
acceptable to the Agents, and (C) legal diligence items (including copies of
material contracts, UCC, tax lien, and litigation searches) relative to the
Capital Stock being acquired in connection with the Totalcat Acquisition, each
of which shall be in form and substance reasonably acceptable to the Agents;

(xiii) a certificate from the chief financial officer of the Borrower certifying
that the sum of Availability and Qualified Cash shall equal or exceed $5,000,000
immediately after giving effect to the Totalcat Acquisition; and

(xiv) such other agreements, instruments, approvals, opinions and other
documents, each satisfactory to the Collateral Agent, in form and substance, as
the Collateral Agent may reasonably request.

(e) Consummation of Totalcat Acquisition. Concurrently with the making of the
Term Loan B, (i) the Borrower shall have purchased pursuant to the Totalcat
Acquisition Agreement (no provision of which shall have been amended or
otherwise modified or waived without the prior written consent of the Agents),
and shall have become the owner, free and clear of all Liens other than
Permitted Liens, of 82.5% of the issued and outstanding Capital Stock of
Totalcat for a Purchase Price not in excess of $35,700,000 in cash or other
immediately available funds (subject to a working capital adjustment), (ii) the
proceeds of the Term Loan B shall have been applied (together with a portion of
the proceeds of the Qualified Issuance and other funds of the Borrower and its
Subsidiaries) to pay the Purchase Price payable pursuant to the Totalcat
Acquisition Agreement for 82.5% of the issued and outstanding Capital Stock of
Totalcat and the closing and other costs relating thereto.

(f) Loans on Term Loan B Funding Date. The aggregate amount of the Term Loans
outstanding as of the Term Loan B Funding Date shall not exceed 2.25 times TTM
EBITDA for the most recently completed 12 month period set forth in the
Financial Statements referenced in Section 5.01(l) after giving pro forma effect
to the Totalcat Acquisition.

(g) Qualified Issuance. The Collateral Agent shall have received evidence
satisfactory to it that the Qualified Issuance shall have occurred on or prior
to the Term Loan B Funding Date.

(h) Foothill Loan Agreement. The Agents shall have received evidence
satisfactory to each of them that the Foothill Loan Agreement shall have been
amended on or prior to the Term Loan B Funding Date to increase the aggregate
commitments available thereunder to $85,000,000.

(i) Notices. The Administrative Agent shall have received a Notice of Borrowing
with respect to the Term Loan B pursuant to Section 2.02 hereof.

Section 5.03 Conditions Subsequent to All Loans. The Loan Parties agree to
fulfill, on or before the date applicable thereto, each of the following
conditions subsequent (the failure by the Loan Parties to so perform or cause to
be performed any of the following to constitute an immediate Event of Default
hereunder):

(a) on or before the date that is 30 days after the Effective Date, the Agents
shall have received such depository account, blocked account, lockbox account
and similar agreements and other documents, each in form and substance
reasonably satisfactory to the Agents, as the Agents may request with respect to
the Borrower’s cash management system;

(b) on or before the date that is 30 days after the Effective Date, the
Collateral Agent shall have received additional insured and loss payable
endorsements required by Section 7.01, in form and substance satisfactory to the
Collateral Agent;

(c) on or before the date that is 30 days after the Effective Date, a landlord
waiver, in form and substance satisfactory to the Collateral Agent and which may
be included as a provision contained in the relevant Lease, executed by each
landlord with respect to each of the following locations: 186 North Avenue East,
Cranford, New Jersey, and 3949 Guasti Road, Ontario, California (provided that
if the Borrower shall have used its commercially reasonable efforts to obtain
the landlord waiver with respect to the location at 186 North Avenue East,
Cranford, New Jersey, within such time period no Event of Default shall be
deemed to have occurred);

(d) on or before the date that is 30 days after the Effective Date, the
Collateral Agent shall have received a Mortgage, duly executed by the applicable
Loan Party with respect to each Facility;

(e) on or before the date that is 30 days after the Effective Date, the
Collateral Agent shall have received evidence that the Mortgages described in
the foregoing clause (c) have been submitted for recording in such office or
offices as may be necessary or, in the opinion of the Collateral Agent,
desirable to perfect the Lien purported to be created thereby or to otherwise
protect the rights of the Collateral Agent and the Lenders thereunder, together
with a Title Insurance Policy with respect to the Mortgages;

(f) on or before July 6, 2007, the Collateral Agent shall have received evidence
satisfactory to it that any Liens held by Fulton Bank on the assets of Tranzact
Corporation shall have been terminated of record; and

(g) prior to 5:00 p.m. (New York City time), the Collateral Agent shall have
received an opinion of Illinois local counsel to the Loan Parties, in form and
substance reasonably satisfactory to the Collateral Agent.

ARTICLE VI

REPRESENTATIONS AND WARRANTIES

Section 6.01 Representations and Warranties. Each Loan Party hereby represents
and warrants to the Agents and the Lenders as follows:

(a) Organization, Good Standing, Etc. Each Loan Party (i) is a corporation,
limited liability company or limited partnership duly organized, validly
existing and in good standing under the laws of the state or jurisdiction of its
organization, (ii) has all requisite power and authority to conduct its business
as now conducted and as currently contemplated and, in the case of the Borrower,
to make the borrowings hereunder, and to execute and deliver each Loan Document
to which it is a party, and to consummate the transactions contemplated thereby,
and (iii) is duly qualified to do business and is in good standing in each
jurisdiction in which the character of the properties owned or leased by it or
in which the transaction of its business makes such qualification necessary.

(b) Authorization, Etc. The execution, delivery and performance by each Loan
Party of each Loan Document to which it is or will be a party, (i) have been
duly authorized by all necessary action, (ii) do not and will not contravene its
charter or by-laws, its limited liability company or operating agreement or its
certificate of partnership or partnership agreement, as applicable, or any
applicable law or any contractual restriction binding on or otherwise affecting
it or any of its properties, (iii) do not and will not result in or require the
creation of any Lien (other than pursuant to any Loan Document) upon or with
respect to any of its properties, and (iv) do not and will not result in any
default, noncompliance, suspension, revocation, impairment, forfeiture or
nonrenewal of any permit, license, authorization or approval applicable to its
operations or any of its properties.

(c) Governmental Approvals. No authorization or approval or other action by, and
no notice to or filing with, any Governmental Authority is required in
connection with the due execution, delivery and performance by any Loan Party of
any Loan Document to which it is or will be a party.

(d) Enforceability of Loan Documents. This Agreement is, and each other Loan
Document to which any Loan Party is or will be a party, when delivered
hereunder, will be, a legal, valid and binding obligation of such Person,
enforceable against such Person in accordance with its terms, except as may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws.

(e) Subsidiaries. Schedule 6.01(e) is a complete and correct description of the
name, jurisdiction of incorporation and ownership of the outstanding Capital
Stock of each Subsidiary of the Borrower. All of the issued and outstanding
shares of Capital Stock of such Subsidiaries have been validly issued and are
fully paid and non-assessable, and the holders thereof are not entitled to any
preemptive, first refusal or other similar rights. Except as indicated on such
Schedule, all such Capital Stock is owned by the Borrower or one or more of its
wholly-owned Subsidiaries, free and clear of all Liens (other than Permitted
Liens). There are no outstanding debt or equity securities of the Borrower or
any of its Subsidiaries and no outstanding obligations of the Borrower or any of
its Subsidiaries convertible into or exchangeable for, or warrants, options or
other rights for the purchase or acquisition from the Borrower or any of its
Subsidiaries, or other obligations of any Subsidiary to issue, directly or
indirectly, any shares of Capital Stock of any Subsidiary of the Borrower.

(f) Litigation; Commercial Tort Claims. Except as set forth in Schedule 6.01(f),
(i) there is no pending or, to the knowledge of any Loan Party, threatened
action, suit or proceeding affecting any Loan Party before any court or other
Governmental Authority or any arbitrator that (A) if adversely determined, could
reasonably be expected to result in a Material Adverse Effect or (B) relates to
this Agreement or any other Loan Document or any transaction contemplated hereby
or thereby and (ii) as of the Effective Date, none of the Loan Parties holds any
commercial tort claims in respect of which a claim has been filed in a court of
law or a written notice by an attorney has been given to a potential defendant.

(g) Financial Condition.

(i) The Financial Statements, copies of which have been delivered to each Agent
and each Lender, fairly present, in all material respects, the consolidated
financial condition of the Borrower and its Subsidiaries as at the respective
dates thereof and the consolidated results of operations of the Borrower and its
Subsidiaries for the fiscal periods ended on such respective dates, all in
accordance with GAAP, and since December 31, 2006, no event or development has
occurred that has had or could reasonably be expected to result in a Material
Adverse Effect.

(ii) The Borrower has heretofore furnished to each Agent and each Lender
(A) projected monthly income statements of the Borrower and its Subsidiaries for
the period from July 1, 2007 through December 31, 2007, and (B) projected
monthly balance sheets and statements of cash flows of the Borrower and its
Subsidiaries for the period from July 1, 2007 through December 31, 2007, which
projected financial statements shall be updated from time to time pursuant to
Section 7.01(a)(vii). Such projections, as so updated, are believed by the
Borrower at the time furnished to be reasonable, have been prepared on a
reasonable basis and in good faith by the Borrower, and have been based on
assumptions believed by the Borrower to be reasonable at the time made and upon
the best information then reasonably available to the Borrower, and the Borrower
is not aware of any facts or information that would lead it to believe that such
projections, as so updated, are incorrect or misleading in any material respect.

(h) Compliance with Law, Etc. No Loan Party is in violation of its
organizational documents, any law, rule, regulation, judgment or order of any
Governmental Authority applicable to it or any of its property or assets (which
violation could reasonably be expected to result in a Material Adverse Effect),
or any material term of any agreement or instrument (including any Material
Contract) binding on or otherwise affecting it or any of its properties, and no
Default or Event of Default has occurred and is continuing.

(i) ERISA. Except as set forth on Schedule 6.01(i), (i) each Employee Plan is in
substantial compliance with ERISA and the IRC, (ii) no Termination Event has
occurred nor is reasonably expected to occur with respect to any Employee Plan,
(iii) the most recent annual report (Form 5500 Series) with respect to each
Employee Plan, including any required Schedule B (Actuarial Information)
thereto, copies of which have been filed with the Internal Revenue Service and
delivered to the Agents, is complete and correct and fairly presents the funding
status of such Employee Plan, and since the date of such report there has been
no material adverse change in such funding status, (iv) copies of each agreement
entered into with the PBGC, the U.S. Department of Labor or the Internal Revenue
Service with respect to any Employee Plan have been delivered to the Agents,
(v) no Employee Plan had an accumulated or waived funding deficiency or
permitted decrease which would create a deficiency in its funding standard
account or has applied for an extension of any amortization period within the
meaning of Section 412 of the IRC at any time during the previous 60 months, and
(vi) no Lien imposed under the IRC or ERISA exists or is likely to arise on
account of any Employee Plan within the meaning of Section 412 of the IRC.
Except as set forth on Schedule 6.01(i), no Loan Party or any of its ERISA
Affiliates has incurred any withdrawal liability under ERISA with respect to any
Multiemployer Plan, or is aware of any facts indicating that it or any of its
ERISA Affiliates may in the future incur any such withdrawal liability. No Loan
Party or any of its ERISA Affiliates nor any fiduciary of any Employee Plan has
(A) engaged in a nonexempt prohibited transaction described in Sections 406 of
ERISA or 4975 of the IRC, (B) failed to pay any required installment or other
payment required under Section 412 of the IRC on or before the due date for such
required installment or payment, (C) engaged in a transaction within the meaning
of Section 4069 of ERISA or (D) incurred any liability to the PBGC which remains
outstanding other than the payment of premiums, and there are no premium
payments which have become due which are unpaid. There are no pending or, to the
knowledge of any Loan Party, threatened claims, actions, proceedings or lawsuits
(other than claims for benefits in the normal course) asserted or instituted
against (1) any Employee Plan or its assets, (2) any fiduciary with respect to
any Employee Plan, or (3) any Loan Party or any of its ERISA Affiliates with
respect to any Employee Plan. Except as required by Section 4980B of the
Internal Revenue Code, no Loan Party or any of its ERISA Affiliates maintains an
employee welfare benefit plan (as defined in Section 3(1) of ERISA) which
provides health or welfare benefits (through the purchase of insurance or
otherwise) for any retired or former employee of any Loan Party or any of its
ERISA Affiliates or coverage after a participant’s termination of employment.

(j) Taxes, Etc. All Federal, state and local tax returns and other reports
required by applicable law to be filed by any Loan Party have been filed, or
extensions have been obtained, and all taxes, assessments and other governmental
charges imposed upon any Loan Party or any property of any Loan Party and which
have become due and payable have been paid, except to the extent contested in
good faith by proper proceedings which stay the imposition of any penalty, fine
or Lien resulting from the non-payment thereof and with respect to which
adequate reserves have been set aside for the payment thereof in accordance with
GAAP.

(k) Regulations T, U and X. No Loan Party is or will be engaged in the business
of extending credit for the purpose of purchasing or carrying margin stock
(within the meaning of Regulation T, U or X), and no proceeds of any Loan will
be used to purchase or carry any margin stock or to extend credit to others for
the purpose of purchasing or carrying any margin stock.

(l) Nature of Business. No Loan Party is engaged in any business other than as
set forth on Schedule 6.01(l).

(m) Adverse Agreements, Etc. No Loan Party is a party to any agreement or
instrument, or subject to any charter, limited liability company agreement,
partnership agreement or other corporate, partnership or limited liability
company restriction or any judgment, order, regulation, ruling or other
requirement of a court or other Governmental Authority, which has, or could
reasonably be expected to result in, a Material Adverse Effect.

(n) Permits, Etc. Each Loan Party has, and is in compliance with, all permits,
licenses, authorizations, approvals, entitlements and accreditations required
for such Person lawfully to own, lease, manage or operate, or to acquire, each
business currently owned, leased, managed or operated, or to be acquired, by
such Person except for such licenses, permits and approvals as to which a Loan
Party’s failure to maintain or comply with could not reasonably be expected to
result in a Material Adverse Effect. To the best knowledge of each Loan Party,
no condition exists or event has occurred which, in itself or with the giving of
notice or lapse of time or both, would result in the suspension, revocation,
impairment, forfeiture or non-renewal of any such permit, license,
authorization, approval, entitlement or accreditation, and there is no claim
that any thereof is not in full force and effect.

(o) Properties.  (i)  Each Loan Party has good and marketable title to, valid
leasehold interests in, or valid licenses to use, all property and assets
material to its business, free and clear of all Liens, except Permitted Liens.
All such properties and assets are in good working order and condition, ordinary
wear and tear excepted.

(ii) Schedule 6.01(o) sets forth a complete and accurate list, as of the
Effective Date, of the location, by state and street address, of all real
property owned or leased by each Loan Party. As of the Effective Date, each Loan
Party has valid leasehold interests in the Leases described on Schedule 6.01(o)
to which it is a party. Schedule 6.01(o) sets forth with respect to each such
Lease, the commencement date, termination date, renewal options (if any) and
annual base rents. Each such Lease is valid and enforceable in accordance with
its terms in all material respects and is in full force and effect. No consent
or approval of any landlord or other third party in connection with any such
Lease is necessary for any Loan Party to enter into and execute the Loan
Documents to which it is a party, except as set forth on Schedule 6.01(o). To
the knowledge of any Loan Party, no other party to any such Lease is in default
of its obligations thereunder, and no Loan Party (or any other party to any such
Lease) has at any time delivered or received any notice of default which remains
uncured under any such Lease and, as of the Effective Date, no event has
occurred which, with the giving of notice or the passage of time or both, would
constitute a default under any such Lease.

(p) Full Disclosure. Each Loan Party has disclosed to the Agents all material
agreements, instruments and corporate or other restrictions to which it is
subject, and all other matters known to it, that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect.
None of the other reports, financial statements, certificates or other
information furnished by or on behalf of any Loan Party to the Agents in
connection with the negotiation of this Agreement or delivered hereunder (as
modified or supplemented by other information so furnished) contains any
material misstatement of fact or omits to state any material fact necessary to
make the statements therein, in the light of the circumstances under which it
was made, not misleading; provided that, with respect to projected financial
information, each Loan Party represents only that such information was prepared
in good faith based upon assumptions believed to be reasonable at the time.
There is no contingent liability or fact that could reasonably be expected to
result in a Material Adverse Effect which has not been set forth in a footnote
included in the Financial Statements or a Schedule hereto.

(q) Operating Lease Obligations. On the Effective Date, none of the Loan Parties
has any Operating Lease Obligations other than the Operating Lease Obligations
set forth on Schedule 6.01(q).

(r) Environmental Matters. Except as set forth on Schedule 6.01(r), (i) the
operations of each Loan Party are in compliance with all Environmental Laws;
(ii) to the best knowledge of each Loan Party, there has been no Release at any
of the properties owned or operated by any Loan Party or a predecessor in
interest, or at any disposal or treatment facility which received Hazardous
Materials generated by any Loan Party or any predecessor in interest which could
reasonably be expected to result in a Material Adverse Effect; (iii) no
Environmental Action has been asserted against any Loan Party or any predecessor
in interest nor does any Loan Party have knowledge or notice of any threatened
or pending Environmental Action against any Loan Party or any predecessor in
interest which could reasonably be expected to result in a Material Adverse
Effect; (iv) no Environmental Actions have been asserted against any facilities
that may have received Hazardous Materials generated by any Loan Party or any
predecessor in interest which could reasonably be expected to result in a
Material Adverse Effect; (v) to the best knowledge of each Loan Party, no
property now or formerly owned or occupied by a Loan Party has been used as a
treatment or disposal site for any Hazardous Material; (vi) no Loan Party has
failed to report to the proper Governmental Authority the occurrence of any
Release which is required to be so reported by any Environmental Laws which
could reasonably be expected to result in a Material Adverse Effect; (vii) each
Loan Party holds all licenses, permits and approvals required under any
Environmental Laws in connection with the operation of the business carried on
by it, except for such licenses, permits and approvals as to which a Loan
Party’s failure to maintain or comply with could not reasonably be expected to
result in a Material Adverse Effect; (viii) no Loan Party has received any
notification pursuant to any Environmental Laws that (A) any work, repairs,
construction or Capital Expenditures are required to be made in respect of any
of its properties as a condition of continued compliance with any Environmental
Laws, or any license, permit or approval issued pursuant thereto or (B) any
license, permit or approval referred to above is about to be reviewed, made
subject to limitations or conditions, revoked, withdrawn or terminated, in each
case, except as could not reasonably be expected to result in a Material Adverse
Effect, and (ix) all Environmental Liabilities and Costs of each Loan Party have
been satisfied or reserved for on the Books of such Loan Party in accordance
with GAAP.

(s) Insurance. Each Loan Party keeps its property adequately insured and
maintains (i) insurance to such extent and against such risks, including fire,
as is customary with companies in the same or similar businesses, (ii) worker’s
compensation insurance in the amount required by applicable law, (iii) public
liability insurance, which shall include product liability insurance, in the
amount customary with companies in the same or similar business against claims
for personal injury or death on properties owned, occupied or controlled by it,
and (iv) such other insurance as may be required by law or as may be reasonably
required by the Collateral Agent (including against larceny, embezzlement or
other criminal misappropriation). Schedule 6.01(s) sets forth a list of all
insurance maintained by each Loan Party on the Effective Date.

(t) Use of Proceeds. The proceeds of the Term Loans shall be used to (a) finance
the payment of a portion of the consideration payable to complete the
Acquisitions, (b) pay fees and expenses in connection with the transactions
contemplated hereby, and (c) fund working capital of the Borrower and the
Guarantors.

(u) Solvency. After giving effect to the transactions contemplated by this
Agreement and before and after giving effect to each Loan, each Loan Party is,
and the Loan Parties on a consolidated basis are, Solvent.

(v) Location of Bank Accounts. Schedule 6.01(v) sets forth a complete and
accurate list as of the Effective Date of all deposit, checking and other bank
accounts, all securities and other accounts maintained with any broker dealer
and all other similar accounts maintained by each Loan Party, together with a
description thereof (i.e., the bank or broker dealer at which such deposit or
other account is maintained and the account number and the purpose thereof).

(w) Intellectual Property. Except as set forth on Schedule 6.01(w), each Loan
Party owns or licenses or otherwise has the right to use all licenses, permits,
patents, patent applications, trademarks, trademark applications, service marks,
tradenames, copyrights, copyright applications, franchises, authorizations,
non-governmental licenses and permits and other intellectual property rights
that are necessary for the operation of its business, without infringement upon
or conflict with the rights of any other Person with respect thereto, except for
such infringements and conflicts which, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Effect. Set forth on
Schedule 6.01(w) is a complete and accurate list as of the Effective Date of all
such material licenses, permits, patents, patent applications, trademarks,
trademark applications, service marks, tradenames, copyrights, copyright
applications, franchises, authorizations, non-governmental licenses and permits
and other intellectual property rights of each Loan Party. No slogan or other
advertising device, product, process, method, substance, part or other material
now employed, or now contemplated to be employed, by any Loan Party infringes
upon or conflicts with any rights owned by any other Person, and no claim or
litigation regarding any of the foregoing is pending or threatened, except for
such infringements and conflicts which could not reasonably be expected to
result in, individually or in the aggregate, a Material Adverse Effect. To the
knowledge of each Loan Party, no patent, invention, device, application,
principle or any statute, law, rule, regulation, standard or code is pending or
proposed, which, individually or in the aggregate, could reasonably be expected
to result in a Material Adverse Effect.

(x) Material Contracts. Set forth on Schedule 6.01(x) is a complete and accurate
list as of the Effective Date of all Material Contracts of each Loan Party,
showing the parties and subject matter thereof and amendments and modifications
thereto. Each such Material Contract (i) is in full force and effect and is
binding upon and enforceable against each Loan Party that is a party thereto
and, to the knowledge of such Loan Party, all other parties thereto in
accordance with its terms, (ii) has not been otherwise amended or modified, and
(iii) is not in default due to the action of any Loan Party or, to the knowledge
of any Loan Party, any other party thereto.

(y) Investment Company Act. None of the Loan Parties is an “investment company”
or an “affiliated person” or “promoter” of, or “principal underwriter” of or
for, an “investment company”, as such terms are defined in the Investment
Company Act of 1940, as amended.

(z) Employee and Labor Matters. There is (i) no unfair labor practice complaint
pending or, to the knowledge of any Loan Party, threatened against any Loan
Party before any Governmental Authority and no grievance or arbitration
proceeding pending or threatened against any Loan Party which arises out of or
under any collective bargaining agreement, (ii) no strike, labor dispute,
slowdown, stoppage or similar action or grievance pending or threatened against
any Loan Party or (iii) to the knowledge of any Loan Party, no union
representation question existing with respect to the employees of any Loan Party
and no union organizing activity taking place with respect to any of the
employees of any Loan Party. No Loan Party or any of its ERISA Affiliates has
incurred any liability or obligation under the Worker Adjustment and Retraining
Notification Act (“WARN”) or similar state law, which remains unpaid or
unsatisfied. The hours worked and payments made to employees of any Loan Party
have not been in violation of the Fair Labor Standards Act or any other
applicable legal requirements, except to the extent such violations could not,
individually or in the aggregate, reasonably be expected to result in a Material
Adverse Effect. All material payments due from any Loan Party on account of
wages and employee health and welfare insurance and other benefits have been
paid or accrued as a liability on the books of such Loan Party, except where the
failure to do so could not, individually or in the aggregate, reasonably be
expected to result in a Material Adverse Effect.

(aa) Customers and Suppliers. There exists no actual or threatened termination,
cancellation or limitation of, or modification to or change in, the business
relationship between (i) any Loan Party, on the one hand, and any customer or
any group thereof, on the other hand, whose agreements with any Loan Party are
individually or in the aggregate material to the business or operations of such
Loan Party, or (ii) any Loan Party, on the one hand, and any material supplier
thereof, on the other hand.

(bb) No Bankruptcy Filing. No Loan Party is contemplating either the filing of a
petition by it under any state, federal or foreign bankruptcy or insolvency laws
or the liquidation of all or a major portion of such Loan Party’s assets or
property, and no Loan Party has any knowledge of any Person contemplating the
filing of any such petition against it.

(cc) Separate Existence.

(i) All customary formalities regarding the separate existence of each Loan
Party have been at all times since its formation observed.

(ii) Each Loan Party has at all times since its formation accurately maintained
its financial statements, accounting records and other organizational documents
separate from those of any Affiliate of such Loan Party and any other Person
(except that the Loan Parties report publicly on a consolidated basis). No Loan
Party has at any time since its formation commingled its assets with those of
any of its Affiliates or any other Person. Each Loan Party has at all times
since its formation accurately maintained its own bank accounts and separate
books of account.

(iii) Each Loan Party has at all times since its formation identified itself in
all dealings with the public, under its own name and as a separate and distinct
Person. No Loan Party has at any time since its formation identified itself as
being a division or a part of any other Person.

(dd) Name; Jurisdiction of Organization; Organizational ID Number; Chief Place
of Business; Chief Executive Office; FEIN. Schedule 6.01(dd) sets forth a
complete and accurate list as of the date hereof of (i) the exact legal name of
each Loan Party, (ii) the jurisdiction of organization of each Loan Party,
(iii) the organizational identification number of each Loan Party (or indicates
that such Loan Party has no organizational identification number), (iv) each
place of business of each Loan Party, (v) the chief executive office of each
Loan Party and (vi) the federal employer identification number of each Loan
Party.

(ee) Tradenames. Schedule 6.01(ee) hereto sets forth a complete and accurate
list as of the Effective Date of all tradenames used by each Loan Party.

(ff) Locations of Collateral. There is no location at which any Loan Party has
any Collateral (except for Inventory in transit) other than (i) those locations
listed on Schedule 6.01(ff) and (ii) any other locations approved in writing by
the Collateral Agent from time to time. Schedule 6.01(ff) hereto contains a
true, correct and complete list, as of the Effective Date, of the legal names
and addresses of each warehouse at which Collateral of each Loan Party is
stored. None of the receipts received by any Loan Party from any warehouse
states that the goods covered thereby are to be delivered to bearer or to the
order of a named Person or to a named Person and such named Person’s assigns.

(gg) Security Interests. Each Security Agreement creates in favor of the
Collateral Agent, for the benefit of the Agents and the Lenders, a legal, valid
and enforceable security interest in the Collateral covered thereby. Upon the
filing of the financing statements described in Section 5.01(d)(iv), such
security interests in and Liens on the Collateral granted thereby in which a
security interest is perfected by filing of a financing statement under the Code
shall be perfected, second priority security interests (subject to Permitted
Liens), and no further recordings or filings are or will be required in
connection with the creation, perfection or enforcement of such security
interests and Liens.

(hh) Schedules. All of the information which is required to be scheduled to this
Agreement is set forth on the Schedules attached hereto, is correct and accurate
and does not omit to state any information material thereto.

(ii) Representations and Warranties in Documents; No Default. All
representations and warranties set forth in this Agreement and the other Loan
Documents are true and correct in all respects at the time as of which such
representations were made and on the Effective Date. No Event of Default has
occurred and is continuing and no condition exists which constitutes a Default
or an Event of Default.

(jj) Acquisition Documents.

(i) As of the Effective Date, the Borrower has delivered to the Agents complete
and correct copies of the material Annaco Acquisition Documents (including all
schedules, exhibits, amendments, supplements, modifications, and assignments).
No Loan Party that is a party to the Annaco Acquisition Documents is in default
in the performance or compliance with any provisions thereof. The Annaco
Acquisition Documents comply in all material respects with, and the Annaco
Acquisition has been, as of the Effective Date, consummated in accordance with,
in all material respects, all applicable laws (including HSR). The Annaco
Acquisition Documents are in full force and effect as of the Effective Date and
have not been terminated, rescinded or withdrawn as of such date. The execution,
delivery and performance of the Annaco Acquisition Documents do not and will not
require any registration with, consent, or approval of, or notice to, or other
action with or by, any Governmental Authority, other than consents or approvals
that have been obtained and that are still in full force and effect. To the best
of the Loan Parties’ knowledge, none of the representations or warranties of any
other Person in any of the Annaco Acquisition Documents contains any untrue
statement of a material fact or omits any fact necessary to make the statements
therein not misleading.

(ii) As of the Term Loan B Funding Date, the Borrower has delivered to the
Agents complete and correct copies of the material Totalcat Acquisition
Documents (including all schedules, exhibits, amendments, supplements,
modifications, and assignments). No Loan Party that is a party to the Totalcat
Acquisition Documents is in default in the performance or compliance with any
provisions thereof. The Totalcat Acquisition Documents comply in all material
respects with, and the Totalcat Acquisition has been, as of the Term Loan B
Funding Date, consummated in accordance with, in all material respects, all
applicable laws (including HSR). The Totalcat Acquisition Documents are in full
force and effect as of the Term Loan B Funding Date and have not been
terminated, rescinded or withdrawn as of such date. The execution, delivery and
performance of the Totalcat Acquisition Documents do not and will not require
any registration with, consent, or approval of, or notice to, or other action
with or by, any Governmental Authority, other than consents or approvals that
have been obtained and that are still in full force and effect. To the best of
the Loan Parties’ knowledge, none of the representations or warranties of any
other Person in any of the Totalcat Acquisition Documents contains any untrue
statement of a material fact or omits any fact necessary to make the statements
therein not misleading.

ARTICLE VII

COVENANTS OF THE LOAN PARTIES

Section 7.01 Affirmative Covenants. So long as any principal of or interest on
any Loan, or any other Obligation (other than unasserted contingent
indemnification Obligations) shall remain unpaid or any Lender shall have any
Commitment hereunder, each Loan Party will and will cause each of its
Subsidiaries to:

(a) Reporting Requirements. Furnish to each Agent and each Lender:

(i) as soon as available and in any event within 45 days after the end of each
fiscal quarter of the Borrower, consolidated and consolidating balance sheets,
consolidated and consolidating statements of operations and retained earnings
and consolidated and consolidating statements of cash flows of the Borrower and
its Subsidiaries as at the end of such quarter, and for the period commencing at
the end of the immediately preceding Fiscal Year and ending with the end of such
quarter, setting forth in each case in comparative form the figures for the
corresponding date or period of the immediately preceding Fiscal Year, all in
reasonable detail and certified by an Authorized Officer of the Borrower as
fairly presenting, in all material respects, the financial position of the
Borrower and its Subsidiaries as of the end of such quarter and the results of
operations and cash flows of the Borrower and its Subsidiaries for such quarter,
in accordance with GAAP applied in a manner consistent with that of the most
recent audited financial statements of the Borrower and its Subsidiaries
furnished to the Agents and the Lenders, subject to normal year-end audit
adjustments and the absence of footnotes;

(ii) as soon as available, and in any event within 90 days after the end of each
Fiscal Year of the Borrower and its Subsidiaries, consolidated and consolidating
balance sheets, consolidated and consolidating statements of operations and
retained earnings and consolidated and consolidating statements of cash flows of
the Borrower and its Subsidiaries as at the end of such Fiscal Year, setting
forth in each case in comparative form the corresponding figures for the
immediately preceding Fiscal Year, all in reasonable detail and prepared in
accordance with GAAP, and accompanied by a report and an unqualified opinion,
prepared in accordance with generally accepted auditing standards, of
independent certified public accountants of recognized standing selected by the
Borrower and satisfactory to the Agents (which opinion shall be without (A) a
“going concern” or like qualification or exception, (B) any qualification or
exception as to the scope of such audit, or (C) any qualification which relates
to the treatment or classification of any item and which, as a condition to the
removal of such qualification, would require an adjustment to such item, the
effect of which would be to cause any noncompliance with the provisions of
Section 7.03, together with a written statement of such accountants (1) to the
effect that, in making the examination necessary for their audit of such
financial statements, they have not obtained any knowledge of the existence of
an Event of Default or a Default under Section 7.03 and (2) if such accountants
shall have obtained any knowledge of the existence of an Event of Default or
such Default under Section 7.03, describing the nature thereof;

(iii) as soon as available, and in any event within 30 days after the end of
each fiscal month of the Borrower and its Subsidiaries, internally prepared
consolidated and consolidating balance sheets, consolidated and consolidating
statements of operations and retained earnings and consolidated and
consolidating statements of cash flows as at the end of such fiscal month, and
for the period commencing at the end of the immediately preceding Fiscal Year
and ending with the end of such fiscal month, in each case, all in reasonable
detail and certified by an Authorized Officer of the Borrower as fairly
presenting, in all material respects, the financial position of the Borrower and
its Subsidiaries as at the end of such fiscal month and the results of
operations, retained earnings and cash flows of the Borrower and its
Subsidiaries for such fiscal month, in accordance with GAAP applied in a manner
consistent with that of the most recent audited financial statements furnished
to the Agents and the Lenders, subject to normal year-end audit adjustments and
the absence of footnotes;

(iv) simultaneously with the delivery of the financial statements of the
Borrower and its Subsidiaries required by clauses (i), (ii) and (iii) of this
Section 7.01(a), a certificate of an Authorized Officer of the Borrower
(A) stating that such Authorized Officer has reviewed the provisions of this
Agreement and the other Loan Documents and has made or caused to be made under
his or her supervision a review of the condition and operations of the Borrower
and its Subsidiaries during the period covered by such financial statements with
a view to determining whether the Borrower and its Subsidiaries were in
compliance with all of the provisions of this Agreement and such Loan Documents
at the times such compliance is required hereby and thereby, and that such
review has not disclosed, and such Authorized Officer has no knowledge of, the
existence during such period of an Event of Default or Default or, if an Event
of Default or Default existed, describing the nature and period of existence
thereof and the action which the Borrower and its Subsidiaries propose to take
or have taken with respect thereto and (B) attaching a schedule showing the
calculation of the financial covenants specified in Section 7.03;

(v) [intentionally omitted];

(vi) [intentionally omitted].

(vii) no later than 30 days preceding each Fiscal Year, financial projections,
supplementing and superseding the financial projections for the period referred
to in Section 6.01(g)(ii)(A) (but in any event including balance sheets, income
statements, and statements of cash flows), displayed on a month by month basis
and otherwise in form and substance reasonably satisfactory to the Agents for
such Fiscal Year for the Borrower and its Subsidiaries, all such financial
projections to be prepared on a reasonable basis and in good faith, and to be
based on assumptions believed by the Borrower to be reasonable at the time made
and from the best information then available to the Borrower;

(viii) promptly after submission to any Governmental Authority, all documents
and information furnished to such Governmental Authority in connection with any
investigation of any Loan Party other than routine inquiries by such
Governmental Authority;

(ix) as soon as possible, and in any event within 3 Business Days of an
Authorized Officer’s knowledge of an Event of Default or Default or the
occurrence of any event or development that could reasonably be expected to
result in a Material Adverse Effect, the written statement of an Authorized
Officer of the Borrower setting forth the details of such Event of Default or
Default or other event or development having a Material Adverse Effect and the
action which the affected Loan Party proposes to take with respect thereto;

(x) (A) as soon as possible and in any event within 10 days after any Loan Party
or any ERISA Affiliate thereof knows or has reason to know that (1) any
Reportable Event with respect to any Employee Plan has occurred, (2) any other
Termination Event with respect to any Employee Plan has occurred, or (3) an
accumulated funding deficiency has been incurred or an application has been made
to the Secretary of the Treasury for a waiver or modification of the minimum
funding standard (including installment payments) or an extension of any
amortization period under Section 412 of the IRC with respect to an Employee
Plan, a statement of an Authorized Officer of the Borrower setting forth the
details of such occurrence and the action, if any, which such Loan Party or such
ERISA Affiliate proposes to take with respect thereto, (B) promptly and in any
event within 3 days after receipt thereof by any Loan Party or any ERISA
Affiliate thereof from the PBGC, copies of each notice received by any Loan
Party or any ERISA Affiliate thereof of the PBGC’s intention to terminate any
Plan or to have a trustee appointed to administer any Plan, (C) promptly and in
any event within 10 days after the filing thereof with the Internal Revenue
Service if requested by any Agent, copies of each Schedule B (Actuarial
Information) to the annual report (Form 5500 Series) with respect to each
Employee Plan and Multiemployer Plan, (D) promptly and in any event within 10
days after any Loan Party or any ERISA Affiliate thereof knows or has reason to
know that a required installment within the meaning of Section 412 of the IRC
has not been made when due with respect to an Employee Plan, (E) promptly and in
any event within 3 days after receipt thereof by any Loan Party or any ERISA
Affiliate thereof from a sponsor of a Multiemployer Plan or from the PBGC, a
copy of each notice received by any Loan Party or any ERISA Affiliate thereof
concerning the imposition or amount of withdrawal liability under Section 4202
of ERISA or indicating that such Multiemployer Plan may enter reorganization
status under Section 4241 of ERISA, and (F) promptly and in any event within
10 days after any Loan Party or any ERISA Affiliate thereof sends notice of a
plant closing or mass layoff (as defined in WARN) to employees, copies of each
such notice sent by such Loan Party or such ERISA Affiliate thereof;

(xi) promptly after the commencement thereof but in any event not later than 5
Business Days after service of process with respect thereto on, or the obtaining
of knowledge thereof by, any Loan Party, notice of each action, suit or
proceeding before any court or other Governmental Authority or other regulatory
body or any arbitrator which, if adversely determined, could reasonably be
expected to result in a Material Adverse Effect;

(xii) as soon as possible and in any event within 5 Business Days after
execution, receipt or delivery thereof, copies of any material notices that any
Loan Party executes or receives in connection with any Material Contract;

(xiii) promptly after the sending or filing thereof, copies of all statements,
reports and other information any Loan Party sends to any holders of its
Indebtedness or its securities or files with the SEC or any national (domestic
or foreign) securities exchange;

(xiv) promptly upon receipt thereof, copies of all financial reports (including
management letters), if any, submitted to any Loan Party by its auditors in
connection with any annual or interim audit of the books thereof;

(xv) to the extent not already provided to the Agents, copies of any notices,
reports, certificates or other documentation as to the assets, financial
condition or affairs of the Borrower and its Subsidiaries (including any
financial projections) that are required to be delivered to Foothill
(collectively, the “Foothill Reports”), in each case on or before the date when
such Foothill Reports are required to be delivered to Foothill pursuant to the
Foothill Loan Agreement, as in effect on the date hereof;

(xvi) promptly after the date on which a Loan Party has actual knowledge of the
existence thereof, a description of any commercial tort claim that such Loan
Party obtains after the Effective Date; and

(xvii) promptly upon request, such other information concerning the condition or
operations, financial or otherwise, of any Loan Party as any Agent may from time
to time may reasonably request.

(b) Additional Guaranties and Collateral Security. Cause:

(i) each Subsidiary of any Loan Party created or acquired after the Effective
Date (the “New Subsidiary”) to execute and deliver to the Collateral Agent
promptly and in any event within 5 Business Days after the formation or
acquisition thereof (A) a Guaranty guaranteeing the Obligations, (B) a Security
Agreement, together with (x) if such New Subsidiary has any Domestic
Subsidiaries, (I) certificates (if any) evidencing all of the Capital Stock of
such Subsidiary owned by such New Subsidiary (provided that this clause may be
satisfied by delivering such certificates to Foothill for so long as the
Foothill Loan Agreement is in existence), (II) undated stock powers executed in
blank (provided that this clause may be satisfied by delivering such documents
to Foothill for so long as the Foothill Loan Agreement is in existence), and
(III) such opinions of counsel and such approving certificate of such Subsidiary
as either Agent may reasonably request in respect of complying with any legend
on any such certificate or any other matter relating to such shares, and (y) if
such New Subsidiary has any first-tier Subsidiaries that are CFCs,
(I) certificates (if any) evidencing all (or, 65% of the outstanding voting
Capital Stock of such Subsidiary if pledging or hypothecating more than 65% of
the total outstanding voting Capital Stock of such Subsidiary reasonably could
be expected to result in material adverse tax consequences to the Loan Parties)
of the outstanding voting Capital Stock of such Subsidiary (provided that this
clause may be satisfied by delivering such certificates to Foothill for so long
as the Foothill Loan Agreement is in existence), (II) undated stock powers
executed in blank with signature guaranteed (provided that this clause may be
satisfied by delivering such documents to Foothill for so long as the Foothill
Loan Agreement is in existence), and (III) such opinions of counsel and such
approving certificate of such Subsidiary as either Agent may reasonably request
in respect of complying with any legend on any such certificate or any other
matter relating to such shares, (C) if such New Subsidiary has a fee interest in
any real property that would constitute After Acquired Property if it were
acquired by a Loan Party, one or more Mortgages creating on such real property a
perfected, second priority (subject to Permitted Liens) Lien on such real
property, a Title Insurance Policy covering such real property, a current ALTA
survey of such real property and a surveyor’s certificate, a Phase I
Environmental Site Assessment with respect to such real property, certified to
the Collateral Agent by a company reasonably satisfactory to the Collateral
Agent, each in form and substance reasonably satisfactory to the Agents,
together with such other agreements, instruments and documents as either Agent
may reasonably require whether comparable to the documents required under
Section 7.01(o) or otherwise, and (D) such other agreements, instruments,
approvals, legal opinions, or other documents reasonably requested by either
Agent in order to create, perfect, establish the second priority (subject to
Permitted Liens) of or otherwise protect any Lien purported to be covered by any
such Security Agreement or Mortgage, or otherwise to effect the intent that such
New Subsidiary shall become bound by all of the terms, covenants and agreements
contained in the Loan Documents and that all property and assets of such New
Subsidiary shall become Collateral for the Obligations; provided that the
foregoing Guaranty, Security Agreement and Mortgage shall not be required to be
provided to the Collateral Agent with respect to any New Subsidiary of a Loan
Party that is a CFC if providing such documents would result in material adverse
tax consequences to the Loan Parties; and

(ii) each Loan Party that is the owner of the Capital Stock of such New
Subsidiary to execute and deliver promptly and in any event within 5 Business
Days after the formation or acquisition of such New Subsidiary a joinder to the
Security Agreement (if it is not already a party thereto), together with (A) if
such New Subsidiary is not a CFC or is a CFC and the pledge of 100% of the
voting Capital Stock of such CFC would not result in material adverse tax
consequences to the Loan Parties, (w) certificates (if any) evidencing all of
the Capital Stock of such New Subsidiary owned by such Loan Party (provided that
this clause may be satisfied by delivering such certificates to Foothill for so
long as the Foothill Loan Agreement is in existence), (x) undated stock powers
or other appropriate instruments or assignment executed in blank with signature
guaranteed (provided that this clause may be satisfied by delivering such
documents to Foothill for so long as the Foothill Loan Agreement is in
existence), (y) such opinions of counsel and such approving certificate of such
New Subsidiary as the Agents may reasonably request in respect of complying with
any legend on any such certificate or any other matter relating to such shares,
and (z) such other agreements, instruments, approvals, legal opinions, or other
documents, or (B) if such New Subsidiary is a CFC and the granting of a pledge
of more than 65% of the voting Capital Stock of such CFC would result in
material adverse tax consequences to the Loan Parties, (w) certificates (if any)
evidencing 65% of the outstanding voting Capital Stock of such New Subsidiary
(provided that this clause may be satisfied by delivering such certificates to
Foothill for so long as the Foothill Loan Agreement is in existence),
(x) undated stock powers or other appropriate instruments or assignment executed
in blank with signature guarantee (provided that this clause may be satisfied by
delivering such documents to Foothill for so long as the Foothill Loan Agreement
is in existence), (y) such opinions of counsel and such approving certificate of
such New Subsidiary as the Agents may reasonably request in respect of complying
with any legend on any such certificate or any other matter relating to such
shares, and (z) such other agreements, instruments, approvals, legal opinions,
or other documents reasonably requested by either Agent.

(c) Compliance with Laws, Etc. Comply, and cause each of its Subsidiaries to
comply, in all material respects with all applicable laws, rules, regulations,
orders (including, without limitation, all Environmental Laws), judgments and
awards (including any settlement of any claim that, if breached, could give rise
to any of the foregoing), such compliance to include (i) paying before the same
become delinquent all taxes, assessments and governmental charges or levies
imposed upon it or upon its income or profits or upon any of its properties, and
(ii) paying all other lawful claims which if unpaid might become a Lien or
charge upon any of its properties, except, in each case, to the extent contested
in good faith by proper proceedings which stay the imposition of any penalty,
fine or Lien resulting from the non-payment thereof and with respect to which
adequate reserves have been set aside for the payment thereof in accordance with
GAAP.

(d) Preservation of Existence, Etc. Maintain and preserve, and cause each of its
Subsidiaries to maintain and preserve, its existence, rights and privileges, and
become or remain, and cause each of its Subsidiaries to become or remain, duly
qualified and in good standing in each jurisdiction in which the character of
the properties owned or leased by it or in which the transaction of its business
makes such qualification necessary.

(e) Keeping of Records and Books of Account. Keep, and cause each of its
Subsidiaries to keep, adequate records and books of account, with complete
entries made to permit the preparation of financial statements in accordance
with GAAP.

(f) Inspection Rights. Permit, and cause each of its Subsidiaries to permit, the
agents and representatives of any Agent at any time and from time to time during
normal business hours, upon reasonable advance notice (so long as no Default or
Event of Default has occurred and is continuing) at the expense of the Borrower,
to examine and make copies of and abstracts from its records and books of
account, to visit and inspect its properties, to verify leases, notes, accounts
receivable, deposit accounts and its other assets, to conduct audits, physical
counts, valuations, appraisals, Phase I Environmental Site Assessments (and, if
requested by the Collateral Agent based upon the results of any such Phase I
Environmental Site Assessment, a Phase II Environmental Site Assessment) or
examinations and to discuss its affairs, finances and accounts with any of its
directors, officers, managerial employees, independent accountants or any of its
other representatives; provided that so long as no Default or Event of Default
shall have occurred and be continuing, (i) the Borrower shall not be obligated
to pay for more than 1 such audit and more than 1 such valuation in any Fiscal
Year, and (ii) the Borrower shall not be obligated to pay for any appraisals,
Phase I Environmental Site Assessments, or Phase II Environmental Site
Assessments unless an event occurs or a fact comes to light after the Effective
Date that establishes the need for such appraisal or assessment, as determined
by Agents in their sole discretion.

(g) Maintenance of Properties, Etc. Maintain and preserve, and cause each of its
Subsidiaries to maintain and preserve, all of its properties which are necessary
or useful in the proper conduct of its business in good working order and
condition, ordinary wear and tear excepted, and comply, and cause each of its
Subsidiaries to comply, at all times with the provisions of all leases to which
it is a party as lessee or under which it occupies property, so as to prevent
any loss or forfeiture thereof or thereunder.

(h) Maintenance of Insurance. Maintain, and cause each of its Subsidiaries to
maintain, insurance with responsible and reputable insurance companies or
associations (including comprehensive general liability, hazard, rent and
business interruption insurance) with respect to its properties (including all
real properties leased or owned by it) and business, in such amounts and
covering such risks as is required by any Governmental Authority having
jurisdiction with respect thereto or as is carried generally in accordance with
sound business practice by companies in similar businesses similarly situated
and in any event in amount, adequacy and scope reasonably satisfactory to the
Collateral Agent. All policies covering the Collateral are to be made payable to
the Collateral Agent for the benefit of the Agents and the Lenders, as its
interests may appear, in case of loss, under a standard non-contributory
“lender” or “secured party” clause and are to contain such other provisions as
the Collateral Agent may require to fully protect the Lenders’ interest in the
Collateral and to any payments to be made under such policies. All certificates
of insurance are to be delivered to the Collateral Agent and the policies are to
be premium prepaid, with the loss payable and additional insured endorsement in
favor of the Collateral Agent and such other Persons as the Collateral Agent may
designate from time to time, and shall provide for not less than 30 days prior
written notice to the Collateral Agent of the exercise of any right of
cancellation (or, in the case of cancellation for non-payment of premium,
10 days prior written notice to the Collateral Agent). If any Loan Party or any
of its Subsidiaries fails to maintain such insurance, the Collateral Agent may
arrange for such insurance, but at the Borrower’s expense and without any
responsibility on the Collateral Agent’s part for obtaining the insurance, the
solvency of the insurance companies, the adequacy of the coverage, or the
collection of claims. Upon the occurrence and during the continuance of an Event
of Default, the Collateral Agent shall have the sole right, in the name of the
Lenders, any Loan Party and its Subsidiaries, to file claims under any insurance
policies, to receive, receipt and give acquittance for any payments that may be
payable thereunder, and to execute any and all endorsements, receipts, releases,
assignments, reassignments or other documents that may be necessary to effect
the collection, compromise or settlement of any claims under any such insurance
policies.

(i) Obtaining of Permits, Etc. Obtain, maintain and preserve, and cause each of
its Subsidiaries to obtain, maintain and preserve, and take all necessary action
to timely renew, all permits, licenses, authorizations, approvals, entitlements
and accreditations which are necessary or useful in the proper conduct of its
business.

(j) Environmental. (i)  Keep any property either owned or operated by it or any
of its Subsidiaries free of any Environmental Liens; (ii) comply, and cause each
of its Subsidiaries to comply, in all material respects with Environmental Laws
and provide to the Collateral Agent any documentation of such compliance which
the Collateral Agent may reasonably request; (iii) provide the Agents written
notice within 5 days of any Release of a Hazardous Material in excess of any
reportable quantity from or onto property owned or operated by it or any of its
Subsidiaries and take any Remedial Actions required to abate said Release;
(iv) maintain a reserve on its Books in such amount as is required under GAAP
with respect to all Environmental Liabilities and Costs; (v) promptly provide
the Agents with written notice within 10 days of the receipt of any of the
following: (A) notice that an Environmental Lien has been filed against any
property of any Loan Party or any of its Subsidiaries; (B) commencement of any
Environmental Action or notice that an Environmental Action will be filed
against any Loan Party or any of its Subsidiaries; and (C) notice of a
violation, citation or other administrative order which could reasonably be
expected to result in a Material Adverse Effect; and (vi) defend, indemnify and
hold harmless the Agents and the Lenders and their transferees, and their
respective employees, agents, officers and directors, from and against any
claims, demands, penalties, fines, liabilities, settlements, damages, costs or
expenses (including attorney and consultant fees, investigation and laboratory
fees, court costs and litigation expenses) arising out of (A) the presence,
disposal, release or threatened release of any Hazardous Materials on any
property at any time owned or occupied by any Loan Party or any of its
Subsidiaries (or its predecessors in interest or title), (B) any personal injury
(including wrongful death) or property damage (real or personal) arising out of
or related to such Hazardous Materials, (C) any investigation, lawsuit brought
or threatened, settlement reached or government order relating to such Hazardous
Materials, (D) any violation of any Environmental Law arising in connection with
any property at any time owned or occupied by any Loan Party or any of its
Subsidiaries (or its predecessors in interest or title) or (E) any Environmental
Action filed against any Agent or any Lender arising in connection with any
property at any time owned or occupied by any Loan Party or any of its
Subsidiaries (or its predecessors in interest or title).

(k) Further Assurances. Take such action and execute, acknowledge and deliver,
and cause each of its Subsidiaries to take such action and execute, acknowledge
and deliver, at its sole cost and expense, such agreements, instruments or other
documents as any Agent may require from time to time in order (i) to carry out
more effectively the purposes of this Agreement and the other Loan Documents,
(ii) to subject to valid and perfected second priority Liens (subject to
Permitted Liens) any of the Collateral or any other property (including
commercial tort claims, deposit accounts, securities accounts and commodities
accounts) of any Loan Party and its Subsidiaries, (iii) to establish and
maintain the validity and effectiveness of any of the Loan Documents and the
validity, perfection and priority of the Liens intended to be created thereby,
and (iv) to better assure, convey, grant, assign, transfer and confirm unto each
Agent and each Lender the rights now or hereafter intended to be granted to it
under this Agreement or any other Loan Document. In furtherance of the
foregoing, to the maximum extent permitted by applicable law, each Loan Party
(A) if a Loan Party has failed to comply with its undertakings in this Section
promptly after a written request therefor, authorizes each Agent to execute any
such agreements, instruments or other documents in such Loan Party’s name and to
file such agreements, instruments or other documents in any appropriate filing
office, (B) authorizes each Agent to file any financing statement required
hereunder or under any other Loan Document, and any continuation statement or
amendment with respect thereto, in any appropriate filing office without the
signature of such Loan Party, and (C) ratifies the filing of any financing
statement, and any continuation statement or amendment with respect thereto,
filed without the signature of such Loan Party prior to the date hereof.

(l) Change in Collateral; Collateral Records. (i) Give the Collateral Agent not
less than 30 days prior written notice of any change in the location of any
Collateral, other than to (or in-transit between) locations set forth on
Schedule 6.01(ff) and with respect to which the Collateral Agent has filed
financing statements and otherwise fully perfected its Liens thereon,
(ii) advise the Collateral Agent promptly, in sufficient detail, of any material
adverse change relating to the type, quantity or quality of the Collateral or
the Lien granted thereon and (iii) execute and deliver, and cause each of its
Subsidiaries to execute and deliver, to the Collateral Agent for the benefit of
the Agents and the Lenders from time to time, solely for the Collateral Agent’s
convenience in maintaining a record of Collateral, such written statements and
schedules as the Collateral Agent may reasonably require, designating,
identifying or describing the Collateral.

(m) Landlord Waivers; Collateral Access Agreements.

(i) At any time any Collateral with a book value in excess of $500,000 is
located on any real property of the Borrower or any other Loan Party (whether
such real property is now existing or acquired after the Effective Date) which
is not owned by the Borrower or any other Loan Party, use commercially
reasonable efforts to obtain written subordinations or waivers, in form and
substance satisfactory to the Collateral Agent, of all present and future Liens
to which the owner or lessor of such premises may be entitled to assert against
the Collateral; and

(ii) Use commercially reasonable efforts to obtain written access agreements, in
form and substance satisfactory to the Collateral Agent, providing access to
Collateral located on any premises not owned by the Borrower or any other Loan
Party in order to remove such Collateral from such premises during an Event of
Default.

(n) Subordination. Cause all Indebtedness and other obligations now or hereafter
owed by it to any of its Affiliates, to be subordinated in right of payment and
security to the Indebtedness and other Obligations owing to the Agents and the
Lenders in accordance with a subordination agreement in form and substance
satisfactory to the Agents.

(o) After Acquired Property. Upon the acquisition by it or any of its
Subsidiaries of any After Acquired Property, promptly so notify the Collateral
Agent, setting forth with specificity a description of the interest acquired,
the location of the real property, any structures or improvements thereon and
either an appraisal or such Loan Party’s good-faith estimate of the current
value of such real property (for purposes of this Section, the “Current Value”).
The Collateral Agent shall notify such Loan Party whether it intends to require
a Mortgage and the other documents referred to below or in the case of
leasehold, a leasehold Mortgage or landlord’s waiver (pursuant to
Section 7.01(m) hereof). Upon receipt of such notice requesting a Mortgage, the
Person which has acquired such After Acquired Property shall promptly furnish to
the Collateral Agent the following, each in form and substance satisfactory to
the Collateral Agent: (i) a Mortgage with respect to such real property and
related assets located at the After Acquired Property, each duly executed by
such Person and in recordable form; (ii) evidence of the recording of the
Mortgage referred to in clause (i) above in such office or offices as may be
necessary or, in the opinion of the Collateral Agent, desirable to create and
perfect a valid and enforceable second priority (subject to Permitted Liens)
lien on the property purported to be covered thereby or to otherwise protect the
rights of the Agents and the Lenders thereunder, (iii) a Title Insurance Policy,
(iv) a survey of such real property, certified to the Collateral Agent and to
the issuer of the Title Insurance Policy by a licensed professional surveyor
reasonably satisfactory to the Collateral Agent, (v) Phase I Environmental Site
Assessments with respect to such real property, certified to the Collateral
Agent by a company reasonably satisfactory to the Collateral Agent, (vi) in the
case of a leasehold interest, a certified copy of the lease between the landlord
and such Person with respect to such real property in which such Person has a
leasehold interest, and the certificate of occupancy with respect thereto,
(vii) in the case of a leasehold interest, an attornment and nondisturbance
agreement between the landlord (and any fee mortgagee) with respect to such real
property and the Collateral Agent, and (viii) such other documents or
instruments (including guarantees and opinions of counsel) as the Collateral
Agent may reasonably require. The Borrower shall pay all fees and expenses,
including reasonable attorneys’ fees and expenses, and all title insurance
charges and premiums, in connection with each Loan Party’s obligations under
this Section 7.01(o).

(p) Fiscal Year. Cause the Fiscal Year of the Borrower and its Subsidiaries to
end on December 31st of each calendar year unless the Agents consent to a change
in such fiscal year of Borrower and its Subsidiaries (and appropriate related
changes to this Agreement).

Section 7.02 Negative Covenants. So long as any principal of or interest on any
Loan, or any other Obligation (other than unasserted contingent indemnification
Obligations) shall remain unpaid or any Lender shall have any Commitment
hereunder, each Loan Party shall not and shall not permit any of its
Subsidiaries to:

(a) Liens, Etc. Create, incur, assume or suffer to exist, or permit any of its
Subsidiaries to create, incur, assume or suffer to exist, any Lien upon or with
respect to any of its properties, whether now owned or hereafter acquired; file
or suffer to exist under the Uniform Commercial Code or any similar law or
statute of any jurisdiction, a financing statement (or the equivalent thereof)
that names it or any of its Subsidiaries as debtor; sign or suffer to exist any
security agreement authorizing any secured party thereunder to file such
financing statement (or the equivalent thereof); sell any of its property or
assets subject to an understanding or agreement, contingent or otherwise, to
repurchase such property or assets (including sales of accounts receivable) with
recourse to it or any of its Subsidiaries or assign or otherwise transfer, or
permit any of its Subsidiaries to assign or otherwise transfer, any account or
other right to receive income; other than, as to all of the above, Permitted
Liens.

(b) Indebtedness. Create, incur, assume, guarantee or suffer to exist, or
otherwise become or remain liable with respect to, or permit any of its
Subsidiaries to create, incur, assume, guarantee or suffer to exist or otherwise
become or remain liable with respect to, any Indebtedness other than Permitted
Indebtedness.

(c) Fundamental Changes; Dispositions. Wind-up, liquidate or dissolve, or merge,
consolidate or amalgamate with any Person, or convey, sell, lease or sublease,
transfer or otherwise dispose of, whether in one transaction or a series of
related transactions, all or any part of its business, property or assets,
whether now owned or hereafter acquired (or agree to do any of the foregoing),
or purchase or otherwise acquire, whether in one transaction or a series of
related transactions, all or substantially all of the assets of any Person (or
any division thereof) (or agree to do any of the foregoing), or permit any of
its Subsidiaries to do any of the foregoing; provided, however, that

(i) any wholly-owned Subsidiary of any Loan Party (other than the Borrower) may
be merged into such Loan Party or another wholly-owned Subsidiary of such Loan
Party, or may consolidate with another wholly-owned Subsidiary of such Loan
Party, so long as (A) no other provision of this Agreement would be violated
thereby, (B) such Loan Party gives the Agents at least 10 Business Days prior
written notice of such merger or consolidation, (C) no Default or Event of
Default shall have occurred and be continuing either before or after giving
effect to such transaction, (D) the Lenders’ rights in any Collateral, including
the existence, perfection and priority of any Lien thereon, are not adversely
affected by such merger or consolidation and (E) the surviving Subsidiary, if
any, is joined as a Loan Party hereunder and is a party to a Guaranty and a
Security Agreement and the Capital Stock of which Subsidiary is the subject of a
Security Agreement, in each case, which is in full force and effect on the date
of and immediately after giving effect to such merger or consolidation;

(ii) the Borrower may dissolve or liquidate any or all of its interest in Gulf
Coast Recycling, Inc., so long as (A) no other provision of this Agreement would
be violated thereby, (B) the Borrower gives the Agents at least 30 days prior
written notice of such dissolution or liquidation, (C) no Default or Event of
Default shall have occurred and be continuing either before or immediately after
giving effect to such transaction, (D) the rights of the Agents and the Lenders
in any Collateral, including the existence, perfection and priority of any Lien
thereon, are not adversely affected by such dissolution or liquidation, and
(E) at the effective time of such dissolution or liquidation, Gulf Coast
Recycling, Inc. shall have no assets having any significant value;

(iii) any Loan Party and its Subsidiaries may make Permitted Dispositions; and

(iv) the Borrower may consummate the Acquisitions.

(d) Change in Nature of Business; Change in Independent Certified Public
Accountant. Make, or permit any of its Subsidiaries to make, any change in the
nature of its business as described in Section 6.01(l) or acquire any properties
or assets that are not reasonably related to the conduct of such business
activities. Make any change in its independent certified public accountant
without the prior written consent of the Agents, which consent shall not be
unreasonably withheld or delayed.

(e) Loans, Advances, Investments, Etc. Make or commit or agree to make any loan,
advance guarantee of obligations, other extension of credit or capital
contributions to, or hold or invest in or commit or agree to hold or invest in,
or purchase or otherwise acquire or commit or agree to purchase or otherwise
acquire any shares of the Capital Stock, bonds, notes, debentures or other
securities of, or make or commit or agree to make any other investment in, any
other Person, or purchase or own any futures contract or otherwise become liable
for the purchase or sale of currency or other commodities at a future date in
the nature of a futures contract, or purchase all or substantially all of the
assets of any other Person, or permit any of its Subsidiaries to do any of the
foregoing, except for: (i) investments existing on the date hereof, as set forth
on Schedule 7.02(e) hereto, but not any increase in the amount thereof as set
forth in such Schedule or any other modification of the terms thereof,
(ii) temporary loans and advances by a Loan Party to another Loan Party, made in
the ordinary course of business, (iii) Permitted Investments, provided that the
Borrower and its Subsidiaries shall not have Permitted Investments in excess of
$500,000 outstanding at any one time unless the Borrower or the applicable
Subsidiary and the applicable securities intermediary or bank have entered into
control agreements or similar arrangements governing such Permitted Investments,
as the Collateral Agent shall determine in its reasonable discretion, to perfect
(and further establish) the the Collateral Agent’s Liens in such Permitted
Investments, (iv) purchases of metals by a Loan Party or one of its Subsidiaries
other than if such purchase is not for ordinary course business operations, but
instead is to speculate on trends and shifts in commodities markets,
(v) purchases of options or future contracts for metals by a Loan Party or one
of its Subsidiaries to be used to hedge against fluctuations in the prices of
Inventory so long as (A) no Default or Event of Default shall have occurred and
be continuing, (B) such purchases are made as a part of such Person’s normal
business operations and consistent with past practices, and (C) such purchases
are not made as a means to speculate for investment purposes on trends and
shifts in commodities markets, (vi) the purchase by the Borrower of 82.5% of the
Capital Stock in connection with the Totalcat Acquisition, (v) the purchase by
the Borrower of the Capital Stock of Totalcat not acquired on the Term Loan B
Funding Date in accordance with the terms of the Totalcat Acquisition Documents
(whether by means of a put or a call) prior to the date that is 60 days after
the second anniversary of the Term Loan B Funding Date], so long as (A) no
Default or Event of Default shall have occurred and be continuing, and (B) after
giving effect to such purchase, the sum of Availability plus Qualified Cash
shall not be less than $5,000,000, and (vi) the Beacon Investment, so long as
(A) no Default or Event of Default shall have occurred and be continuing, and
(B) after giving effect to such investment, the sum of Availability plus
Qualified Cash shall not be less than $2,000,000.

(f) Lease Obligations. Create, incur or suffer to exist, or permit any of its
Subsidiaries to create, incur or suffer to exist, any obligations as lessee
(i) for the payment of rent for any real or personal property in connection with
any sale and leaseback transaction, or (ii) for the payment of rent for any real
or personal property under leases or agreements to lease other than
(A) Capitalized Lease Obligations which would not cause the aggregate amount of
all obligations under Capitalized Leases entered into after the Effective Date
owing by all Loan Parties and their Subsidiaries in any Fiscal Year to exceed
the amounts set forth in Section 7.03(e), and (B) Operating Lease Obligations.

(g) [intentionally omitted].

(h) Restricted Payments.  (i)  Declare or pay any dividend or other
distribution, direct or indirect, on account of any Capital Stock of any Loan
Party or any of its Subsidiaries, now or hereafter outstanding, (ii) make any
repurchase, redemption, retirement, defeasance, sinking fund or similar payment,
purchase or other acquisition for value, direct or indirect, of any Capital
Stock of any Loan Party or any direct or indirect parent of any Loan Party, now
or hereafter outstanding; (iii) make any payment to retire, or to obtain the
surrender of, any outstanding warrants, options or other rights for the purchase
or acquisition of shares of any class of Capital Stock of any Loan Party, now or
hereafter outstanding, or (iv) pay any management fees or any other fees or
expenses (including the reimbursement thereof by any Loan Party or any of its
Subsidiaries) pursuant to any management, consulting or other services agreement
to any of the shareholders or other equityholders of any Loan Party or any of
its Subsidiaries or other Affiliates, or to any other Subsidiaries or Affiliates
of any Loan Party; provided, however, that so long as no Default or Event of
Default has occurred and is continuing, (A) any Subsidiary of the Borrower may
pay dividends to the Borrower, and (B) the Borrower may pay dividends in the
form of common Capital Stock (including common Capital Stock of Beacon in
connection with the consummation of a Permitted Disposition with respect to the
Capital Stock of Beacon).

(i) Federal Reserve Regulations. Permit any Loan or the proceeds of any Loan
under this Agreement to be used for any purpose that would cause such Loan to be
a margin loan under the provisions of Regulation T, U or X of the Board.

(j) Transactions with Affiliates. Enter into, renew, extend or be a party to, or
permit any of its Subsidiaries to enter into, renew, extend or be a party to,
any transaction or series of related transactions (including the purchase, sale,
lease, transfer or exchange of property or assets of any kind or the rendering
of services of any kind) with any Affiliate, except (i) in the ordinary course
of business in a manner and to an extent consistent with past practice and
necessary or desirable for the prudent operation of its business, for fair
consideration and on terms no less favorable to it or its Subsidiaries than
would be obtainable in a comparable arm’s length transaction with a Person that
is not an Affiliate thereof, (ii) transactions with another Loan Party and
(iii) transactions permitted by Section 7.02(e) or (h).

(k) Limitations on Dividends and Other Payment Restrictions Affecting
Subsidiaries. Create or otherwise cause, incur, assume, suffer or permit to
exist or become effective any consensual encumbrance or restriction of any kind
on the ability of any Subsidiary of any Loan Party (i) to pay dividends or to
make any other distribution on any shares of Capital Stock of such Subsidiary
owned by any Loan Party or any of its Subsidiaries, (ii) to pay or prepay or to
subordinate any Indebtedness owed to any Loan Party or any of its Subsidiaries,
(iii) to make loans or advances to any Loan Party or any of its Subsidiaries or
(iv) to transfer any of its property or assets to any Loan Party or any of its
Subsidiaries, or permit any of its Subsidiaries to do any of the foregoing;
provided, however, that nothing in any of clauses (i) through (iv) of this
Section 7.02(k) shall prohibit or restrict compliance with:

(A) this Agreement and the other Loan Documents;

(B) any agreements in effect on the date of this Agreement and described on
Schedule 7.02(k);

(C) any applicable law, rule or regulation (including applicable currency
control laws and applicable state corporate statutes restricting the payment of
dividends in certain circumstances);

(D) in the case of clause (iv), any agreement setting forth customary
restrictions on the subletting, assignment or transfer of any property or asset
that is leased or licensed; or

(E) in the case of clause (iv), any agreement, instrument or other document
evidencing a Permitted Lien that restricts, on customary terms, the transfer of
any property or assets subject thereto.

(l) Limitation on Issuance of Capital Stock. Except for the issuance or sale of
common stock or Permitted Preferred Stock by the Borrower, issue or sell or
enter into any agreement or arrangement for the issuance and sale of, or permit
any of its Subsidiaries to issue or sell or enter into any agreement or
arrangement for the issuance and sale of, any shares of its Capital Stock, any
securities convertible into or exchangeable for its Capital Stock or any
warrants.

(m) Modifications of Indebtedness, Organizational Documents and Certain Other
Agreements; Etc. (i) Except for the Foothill Indebtedness, amend, modify or
otherwise change (or permit the amendment, modification or other change in any
manner of) any of the provisions of any of its or its Subsidiaries’ Indebtedness
or of any instrument or agreement (including any purchase agreement, indenture,
loan agreement or security agreement) relating to any such Indebtedness if such
amendment, modification or change would shorten the final maturity or average
life to maturity of, or require any payment to be made earlier than the date
originally scheduled on, such Indebtedness, would increase the interest rate
applicable to such Indebtedness, would change the subordination provisions, if
any, of such Indebtedness, or would otherwise be adverse to the Lenders or the
issuer of such Indebtedness in any respect, (ii) with respect to the Foothill
Indebtedness, amend, modify or otherwise change (or permit the amendment,
modification or other change in any manner of) any of the provisions of such
Indebtedness or of any instrument or agreement (including any purchase
agreement, indenture, loan agreement or security agreement) relating to any such
Indebtedness if such amendment, modification or change would contravene the
provisions of the Intercreditor Agreement, (iii) except for the Obligations and
the Foothill Indebtedness, make any voluntary or optional payment, prepayment,
redemption, defeasance, sinking fund payment or other acquisition for value of
any of its or its Subsidiaries’ Indebtedness (including by way of depositing
money or securities with the trustee therefor before the date required for the
purpose of paying any portion of such Indebtedness when due), or refund,
refinance, replace or exchange any other Indebtedness for any such Indebtedness
(except to the extent such Indebtedness is otherwise expressly permitted by the
definition of “Permitted Indebtedness”), or make any payment, prepayment,
redemption, defeasance, sinking fund payment or repurchase of any outstanding
Indebtedness as a result of any asset sale, change of control, issuance and sale
of debt or equity securities or similar event, or give any notice with respect
to any of the foregoing, (iv) except as permitted by Section 7.02(c), amend,
modify or otherwise change its name, jurisdiction of organization,
organizational identification number or FEIN, or (v) amend, modify or otherwise
change its certificate of incorporation or bylaws (or other similar
organizational documents), including by the filing or modification of any
certificate of designation, or any agreement or arrangement entered into by it,
with respect to any of its Capital Stock (including any shareholders’
agreement), or enter into any new agreement with respect to any of its Capital
Stock, except any such amendments, modifications or changes or any such new
agreements or arrangements pursuant to this clause (v) that either individually
or in the aggregate, could not reasonably be expected to result in a Material
Adverse Effect.

(n) Investment Company Act of 1940. Engage in any business, enter into any
transaction, use any securities or take any other action or permit any of its
Subsidiaries to do any of the foregoing, that would cause it or any of its
Subsidiaries to become subject to the registration requirements of the
Investment Company Act of 1940, as amended, by virtue of being an “investment
company” or a company “controlled” by an “investment company” not entitled to an
exemption within the meaning of such Act.

(o) [intentionally omitted].

(p) ERISA. (i) Engage, or permit any ERISA Affiliate to engage, in any
transaction described in Section 4069 of ERISA; (ii) engage, or permit any ERISA
Affiliate to engage, in any prohibited transaction described in Section 406 of
ERISA or 4975 of the IRC for which a statutory or class exemption is not
available or a private exemption has not previously been obtained from the U.S.
Department of Labor; (iii) adopt or permit any ERISA Affiliate to adopt any
employee welfare benefit plan within the meaning of Section 3(1) of ERISA which
provides benefits to employees after termination of employment other than as
required by Section 601 of ERISA or applicable law; (iv) fail to make any
contribution or payment to any Multiemployer Plan which it or any ERISA
Affiliate may be required to make under any agreement relating to such
Multiemployer Plan, or any law pertaining thereto; or (v) fail, or permit any
ERISA Affiliate to fail, to pay any required installment or any other payment
required under Section 412 of the IRC on or before the due date for such
installment or other payment.

(q) Environmental. Permit the use, handling, generation, storage, treatment,
release or disposal of Hazardous Materials at any property owned or leased by it
or any of its Subsidiaries, except in compliance with Environmental Laws in a
manner that such handling, generation, storage, treatment, release or disposal
of Hazardous Materials could not reasonably be expected to result in a Material
Adverse Effect.

(r) Certain Agreements. Agree to any material amendment or other material change
to or material waiver of any of its rights under any Material Contract.

Section 7.03 Financial Covenants. So long as any principal of or interest on any
Loan, or any other Obligation (other than unasserted contingent indemnification
Obligations) shall remain unpaid or any Lender shall have any Commitment
hereunder, each Loan Party shall not:

(a) Leverage Ratio.

(i) During the period from the Effective Date to but not including the Term Loan
B Funding Date, permit the ratio of Consolidated Funded Indebtedness of Borrower
and its Subsidiaries as of the last day of each fiscal quarter set forth below
to TTM EBITDA of the Borrower and its Subsidiaries for the period ended as of
the last day of such fiscal quarter to be greater than the applicable ratio set
forth below:

     
Fiscal Quarter End
  Leverage Ratio
September 30, 2006
  2.50:1.00
December 31, 2006
  2.50:1.00
March 31, 2008
  2.50:1.00
June 30, 2008
  2.25:1.00
September 30, 2008
  2.25:1.00
December 31, 2008
  2.25:1.00
March 31, 2009
  2.25:1.00
June 30, 2009
  2.25:1.00
September 30, 2009
  2.25:1.00
December 31, 2009
  2.25:1.00
March 31, 2010
  2.25:1.00
June 30, 2010
  2.25:1.00
September 30, 2010
  2.25:1.00
December 31, 2010
  2.25:1.00
March 31, 2011
  2.25:1.00
June 30, 2011
  2.25:1.00
September 30, 2011
  2.25:1.00
December 31, 2011
  2.25:1.00
March 31, 2012
  2.25:1.00
June 30, 2012
  2.25:1.00
September 30, 2012
  2.25:1.00
December 31, 2012
  2.25:1.00
March 31, 2013
  2.25:1.00
June 30, 2013
  2.25:1.00

(ii) During the period from and after the Term Loan B Funding Date, permit the
ratio of Consolidated Funding Indebtedness of the Borrower and its Subsidiaries
as of the last day of each fiscal quarter set forth below to TTM EBITDA of the
Borrower and its Subsidiaries for the period ended as of the last day of such
fiscal quarter to be greater than the applicable ratio set forth below:

     
Fiscal Quarter End
  Leverage Ratio
September 30, 2007
  2.75:1.00
December 31, 2007
  2.75:1.00
March 31, 2008
  2.75:1.00
June 30, 2008
  2.75:1.00
September 30, 2008
  2.75:1.00
December 31, 2008
  2.75:1.00
March 31, 2009
  2.50:1.00
June 30, 2009
  2.50:1.00
September 30, 2009
  2.50:1.00
December 31, 2009
  2.50:1.00
March 31, 2010
  2.50:1.00
June 30, 2010
  2.50:1.00
September 30, 2010
  2.50:1.00
December 31, 2010
  2.50:1.00
March 31, 2011
  2.50:1.00
June 30, 2011
  2.50:1.00
September 30, 2011
  2.50:1.00
December 31, 2011
  2.50:1.00
March 31, 2012
  2.50:1.00
June 30, 2012
  2.50:1.00
September 30, 2012
  2.50:1.00
December 31, 2012
  2.50:1.00
March 31, 2013
  2.50:1.00
June 30, 2013
  2.50:1.00

(b) [Intentionally omitted.]

(c) Fixed Charge Coverage Ratio. Permit the Fixed Charge Coverage Ratio of the
Borrower and its Subsidiaries for the period of 4 consecutive fiscal quarters
ended as of the last day of each fiscal quarter set forth below to be less than
the applicable ratio set forth opposite such date:

     
Fiscal Quarter End
  Fixed Charge Coverage Ratio
September 30, 2007
  1.25:1.00
December 31, 2007
  1.25:1.00
March 31, 2008
  1.25:1.00
June 30, 2008
  1.25:1.00
September 30, 2008
  1.25:1.00
December 31, 2008
  1.25:1.00
March 31, 2009
  1.25:1.00
June 30, 2009
  1.25:1.00
September 30, 2009
  1.25:1.00
December 31, 2009
  1.25:1.00
March 31, 2010
  1.25:1.00
June 30, 2010
  1.25:1.00
September 30, 2010
  1.25:1.00
December 31, 2010
  1.25:1.00
March 31, 2011
  1.25:1.00
June 30, 2011
  1.25:1.00
September 30, 2011
  1.25:1.00
December 31, 2011
  1.25:1.00
March 31, 2012
  1.25:1.00
June 30, 2012
  1.25:1.00
September 30, 2012
  1.25:1.00
December 31, 20012
  1.25:1.00
March 31, 2013
  1.25:1.00
June 30, 2013
  1.25:1.00

(d) TTM EBITDA.

(i) During the period from the Effective Date to but not including the Term Loan
B Funding Date, permit TTM EBITDA of the Borrower and its Subsidiaries for the
period ended as of the last day of each fiscal quarter set forth below to be
less than the applicable amount set forth opposite such date:

         
Fiscal Quarter End
  TTM EBITDA
June 30, 2007
  $ 31,000,000  
September 30, 2007
  $ 34,000,000  
December 31, 2007
  $ 34,000,000  
March 31, 2008
  $ 34,000,000  
June 30, 2008
  $ 34,000,000  
September 30, 2008
  $ 34,000,000  
December 31, 2008
  $ 34,000,000  
March 31, 2009
  $ 34,000,000  
June 30, 2009
  $ 34,000,000  
September 30, 2009
  $ 34,000,000  
December 31, 2009
  $ 34,000,000  
March 31, 2010
  $ 34,000,000  
June 30, 2010
  $ 34,000,000  
September 30, 2010
  $ 34,000,000  
December 31, 2010
  $ 34,000,000  
March 31, 2011
  $ 34,000,000  
June 30, 2011
  $ 34,000,000  
September 30, 2011
  $ 34,000,000  
December 31, 2011
  $ 34,000,000  
March 31, 2012
  $ 34,000,000  
June 30, 2012
  $ 34,000,000  
September 30, 2012
  $ 34,000,000  
December 31, 2012
  $ 34,000,000  
March 31, 2013
  $ 34,000,000  
June 30, 2013
  $ 34,000,000  

(ii) During the period from and after the Term Loan B Funding Date, permit TTM
EBITDA of the Borrower and its Subsidiaries for the period ended as of the last
day of each fiscal quarter set forth below to be less than the applicable amount
set forth opposite such date:

         
Fiscal Quarter End
  TTM EBITDA
June 30, 2007
  $ 33,000,000  
September 30, 2007
  $ 36,000,000  
December 31, 2007
  $ 36,000,000  
March 31, 2008
  $ 36,000,000  
June 30, 2008
  $ 36,000,000  
September 30, 2008
  $ 36,000,000  
December 31, 2008
  $ 36,000,000  
March 31, 2009
  $ 37,000,000  
June 30, 2009
  $ 37,000,000  
September 30, 2009
  $ 37,000,000  
December 31, 2009
  $ 37,000,000  
March 31, 2010
  $ 38,000,000  
June 30, 2010
  $ 38,000,000  
September 30, 2010
  $ 38,000,000  
December 31, 2010
  $ 38,000,000  
March 31, 2011
  $ 39,000,000  
June 30, 2011
  $ 39,000,000  
September 30, 2011
  $ 39,000,000  
December 31, 2011
  $ 39,000,000  
March 31, 2012
  $ 40,000,000  
June 30, 2012
  $ 40,000,000  
September 30, 2012
  $ 40,000,000  
December 31, 2012
  $ 40,000,000  
March 31, 2013
  $ 41,000,000  
June 30, 2013
  $ 41,000,000  

(e) Capital Expenditures. Make Capital Expenditures in any Fiscal Year in excess
of the amount set forth in the following table for the applicable period:

         
Fiscal Year 2007
  $ 12,000,000  
 
       
Fiscal Year 2008
  $ 12,000,000  
 
       
Fiscal Year 2009
  $ 9,000,000  
 
       
Fiscal Year 2010
  $ 9,000,000  
 
       
Fiscal Year 2011
  $ 9,000,000  
 
       
Fiscal Year 2012
  $ 9,000,000  
 
       
Fiscal Year 2013
  $ 9,000,000  
 
       

provided that if the amount of the Capital Expenditures permitted to be made in
any Fiscal Year as set forth in the above table is greater than the actual
amount of the Capital Expenditures actually made in such Fiscal Year (such
amount, the “Excess Amount”), then the lesser of (i) such Excess Amount and
(ii) 50% of the amount set forth in the above table for the succeeding Fiscal
Year (such lesser amount referred to as the “Carry-Over Amount”) may be carried
forward to the next succeeding Fiscal Year (the “Succeeding Fiscal Year”);
provided further that the Carry-Over Amount applicable to a particular
Succeeding Fiscal Year may not be used in that Fiscal Year until the amount
permitted above to be expended in such Fiscal Year has first been used in full
and the Carry-Over Amount applicable to a particular Succeeding Fiscal Year may
not be carried forward to another Fiscal Year.

ARTICLE VIII

MANAGEMENT, COLLECTION AND STATUS OF

ACCOUNTS RECEIVABLE AND OTHER COLLATERAL

Section 8.01 Collection of Accounts Receivable; Management of Collateral.  

(a) On or prior to the Effective Date, the Borrower shall assist the
Administrative Agent in (i) establishing, and, during the term of this
Agreement, maintaining one or more lockboxes in the name of Foothill (or, if the
Foothill Indebtedness under the Foothill Loan Agreement has been repaid in full
and the Foothill Loan Agreement has been terminated, in the name of the
Administrative Agent) and identified on Schedule 8.01 hereto (collectively, the
“Lockboxes”) with the financial institutions set forth on Schedule 8.01 hereto
or such other financial institutions selected by the Borrower and acceptable to
the Administrative Agent in its sole discretion (each being referred to as a
“Lockbox Bank”), and (ii) establishing, and during the term of this Agreement,
maintaining an account (a “Collection Account” and, collectively, the
“Collection Accounts”) in the name of Foothill (or, if the Foothill Indebtedness
under the Foothill Loan Agreement has been repaid in full and the Foothill Loan
Agreement has been terminated, in the name of the Administrative Agent) with
each Lockbox Bank. The Borrower shall irrevocably instruct its Account Debtors,
with respect to Accounts Receivable of the Borrower, to remit all payments to be
made by checks or other drafts to the Lockboxes and to remit all payments to be
made by wire transfer or by Automated Clearing House, Inc. payment as directed
by Foothill (or, if the Foothill Indebtedness under the Foothill Loan Agreement
has been repaid in full and the Foothill Loan Agreement has been terminated, by
the Administrative Agent) and shall instruct each Lockbox Bank to deposit all
amounts received in its Lockbox to the Collection Account at such Lockbox Bank
on the day received or, if such day is not a Business Day, on the next
succeeding Business Day. All checks, drafts, notes, money orders, acceptances,
cash and other evidences of Indebtedness received directly by the Borrower from
any Account Debtor, as proceeds from Accounts Receivable of the Borrower, or as
proceeds of any other Collateral, shall be held by the Borrower in trust for the
Agents and the Lenders and upon receipt be deposited by the Borrower in original
form and no later than the next Business Day after receipt thereof into a
Collection Account. The Borrower shall not commingle such collections with the
Borrower’s own funds or the funds of any Subsidiary or Affiliate of the Borrower
or with the proceeds of any assets not included in the Collateral. No checks,
drafts or other instruments received by the Administrative Agent shall
constitute final payment to the Administrative Agent unless and until such
checks, drafts or instruments have actually been collected.

(b) After the occurrence and during the continuance of an Event of Default, but
subject to the terms and conditions of the Intercreditor Agreement, the
Collateral Agent may send a notice of assignment or notice of the Lenders’
security interest to any and all Account Debtors and, thereafter, the Collateral
Agent shall have the sole right to collect the Accounts Receivable and payment
intangibles of the Borrower and its Subsidiaries or take possession of the
Collateral and the books and records relating thereto. After the occurrence and
during the continuation of an Event of Default, the Borrower and its
Subsidiaries shall not, without prior written consent of the Collateral Agent,
grant any extension of time of payment of any Account Receivable or payment
intangible, compromise or settle any Account Receivable or payment intangible
for less than the full amount thereof, release, in whole or in part, any Person
or property liable for the payment thereof, or allow any credit or discount
whatsoever thereon.

(c) The Borrower hereby appoints each Agent or its designee on behalf of such
Agent as the Borrower’s attorney-in-fact with power exercisable during the
continuance of an Event of Default to (i) endorse the Borrower’s name upon any
notes, acceptances, checks, drafts, money orders or other evidences of payment
relating to the Accounts Receivable or payment intangibles of the Borrower,
(ii) sign the Borrower’s name on any invoice or bill of lading relating to any
of the Accounts Receivable or payment intangibles of the Borrower, drafts
against Account Debtors with respect to Accounts Receivable or payment
intangibles of the Borrower, assignments and verifications of Accounts
Receivable or payment intangibles and notices to Account Debtors with respect to
Accounts Receivable or payment intangibles of the Borrower, (iii) send
verification of Accounts Receivable of the Borrower, and (iv) notify the Postal
Service authorities to change the address for delivery of mail addressed to the
Borrower to such address as such Agent may designate and to do all other acts
and things necessary to carry out this Agreement. All acts of said attorney or
designee are hereby ratified and approved, and said attorney or designee shall
not be liable for any acts of omission or commission (other than acts of
omission or commission constituting gross negligence or willful misconduct as
determined by a final judgment of a court of competent jurisdiction), or for any
error of judgment or mistake of fact or law; this power being coupled with an
interest is irrevocable until all of the Loans and other Obligations under the
Loan Documents are paid in full and all of the Commitments are terminated.

(d) Nothing herein contained shall be construed to constitute any Agent as agent
of the Borrower for any purpose whatsoever, and the Agents shall not be
responsible or liable for any shortage, discrepancy, damage, loss or destruction
of any part of the Collateral wherever the same may be located and regardless of
the cause thereof (other than from acts of omission or commission constituting
gross negligence or willful misconduct as determined by a final judgment of a
court of competent jurisdiction). The Agents shall not, under any circumstance
or in any event whatsoever, have any liability for any error or omission or
delay of any kind occurring in the settlement, collection or payment of any of
the Accounts Receivable of the Borrower or any instrument received in payment
thereof or for any damage resulting therefrom (other than acts of omission or
commission constituting gross negligence or willful misconduct as determined by
a final judgment of a court of competent jurisdiction). The Agents, by anything
herein or in any assignment or otherwise, do not assume any of the obligations
under any contract or agreement assigned to any Agent and shall not be
responsible in any way for the performance by the Borrower of any of the terms
and conditions thereof.

(e) If any Account Receivable of the Borrower includes a charge for any tax
payable to any Governmental Authority, each Agent is hereby authorized (but in
no event obligated) in its discretion to pay the amount thereof to the proper
taxing authority for the Borrower’s account and to charge the Borrower therefor.
The Borrower shall notify the Agents if any Account Receivable of the Borrower
includes any taxes due to any such Governmental Authority and, in the absence of
such notice, the Agents shall have the right to retain the full proceeds of such
Account Receivable and shall not be liable for any taxes that may be due by
reason of the sale and delivery creating such Account Receivable.

(f) Notwithstanding any other terms set forth in the Loan Documents, the rights
and remedies of the Agents and the Lenders herein provided, and the obligations
of the Loan Parties set forth herein, are cumulative of, may be exercised singly
or concurrently with, and are not exclusive of, any other rights, remedies or
obligations set forth in any other Loan Document or as provided by law.

Section 8.02 [intentionally omitted].

Section 8.03 Status of Accounts Receivable and Other Collateral. With respect to
Collateral of any Loan Party at the time the Collateral becomes subject to the
Collateral Agent’s Lien, each Loan Party covenants, represents and warrants:
(a) such Loan Party shall be the sole owner, free and clear of all Liens (except
for the Liens granted in the favor of the Collateral Agent for the benefit of
the Agents and the Lenders and Permitted Liens), and shall be fully authorized
to sell, transfer, pledge or grant a security interest in each and every item of
said Collateral; (b) intentionally omitted; (c) intentionally omitted;
(d) intentionally omitted; (e) intentionally omitted; (f) intentionally omitted;
(g) intentionally omitted; (h) such Loan Party shall maintain books and records
pertaining to said Collateral in such detail, form and scope as the Agents shall
reasonably require; (i) intentionally omitted; (j) such Loan Party will,
immediately upon learning thereof, report to the Agents any material loss or
destruction of, or substantial damage to, any material item or portion of the
Collateral, and any other matters affecting the value, enforceability or
collectability of any of the Collateral; (k) intentionally omitted; (l) such
Loan Party shall not re-date any invoice or sale or make sales on extended
dating beyond that which is customary in the ordinary course of its business and
in the industry; (m) such Loan Party shall conduct a physical count of its
Inventory at such intervals as any Agent may reasonably request and such Loan
Party shall promptly supply the Agents with a copy of such count accompanied by
a report of the value (based on the lower of cost (on a first in first out
basis) and market value) of such Inventory; and (n) such Loan Party is not and
shall not be entitled to pledge any Agent’s or any Lender’s credit on any
purchases or for any purpose whatsoever.

Section 8.04 Collateral Custodian. Upon the occurrence and during the
continuance of any Event of Default, the Collateral Agent may at any time and
from time to time employ and maintain on the premises of any Loan Party a
custodian selected by the Collateral Agent who shall have full authority to do
all acts necessary to protect the Agents’ and the Lenders’ interests. Each Loan
Party hereby agrees to, and to cause its Subsidiaries to, cooperate with any
such custodian and to do whatever the Collateral Agent may reasonably request to
preserve the Collateral. All costs and expenses incurred by the Collateral Agent
by reason of the employment of the custodian shall be the responsibility of the
Borrower and charged to the Loan Account.

ARTICLE IX

EVENTS OF DEFAULT

Section 9.01 Events of Default. If any of the following events shall occur:

(a) the Borrower shall fail to pay any principal of or interest on any Loan, any
Collateral Agent Advance, or any fee, indemnity or other amount payable under
this Agreement or any other Loan Document when due (whether by scheduled
maturity, required prepayment, acceleration, demand or otherwise);

(b) any representation or warranty made or deemed made by or on behalf of any
Loan Party or by any officer of the foregoing under or in connection with any
Loan Document or under or in connection with any report, certificate, or other
document delivered to any Agent, any Lender pursuant to any Loan Document shall
have been incorrect in any material respect when made or deemed made;

(c) any Loan Party shall fail to perform or comply with any covenant or
agreement contained in (i) clauses (b), (c), (d), (f), or (n) of Section 7.01,
Section 7.02, Section 7.03, or Article VIII, or any Loan Party shall fail to
perform or comply with any covenant or agreement contained in any Security
Agreement to which it is a party or any Mortgage to which it is a party, or
(ii) clauses (a), (e), (g), (h), (i), (j), (k), (l), (o), or (p) of Section 7.01
and (in circumstances described in this clause (ii)) such failure, if capable of
being remedied, shall remain unremedied for 10 Business Days, after the earlier
of the date a senior officer of any Loan Party shall have become aware of such
failure or the date written notice of such default shall have been given by any
Agent or Lender to such Loan Party;

(d) any Loan Party shall fail to perform or comply with any other term, covenant
or agreement contained in any Loan Document to be performed or observed by it
and, except as set forth in subsections (a), (b) and (c) of this Section 9.01,
such failure, if capable of being remedied, shall remain unremedied for 15
Business Days after the earlier of the date a senior officer of any Loan Party
becomes aware of such failure and the date written notice of such default shall
have been given by any Agent to such Loan Party;

(e) the Borrower or any of its Subsidiaries shall fail to pay any principal of
or interest or premium on any of its Indebtedness (excluding the Obligations) to
the extent that the aggregate principal amount of all such Indebtedness exceeds
$250,000 when due (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise) and such failure shall continue after the
applicable grace period, if any, specified in the agreement or instrument
relating to such Indebtedness (except, with respect to any Permitted
Indebtedness of the type described in clauses (l), (m), (n), (o) and (q) of the
definition thereof, so long as the obligation of the Borrower or any such
Subsidiary is being contested in good faith and the aggregate principal amount
thereof does not exceed $500,000), or any other default under any agreement or
instrument relating to any such Indebtedness, or any other event, shall occur
and shall continue after the applicable grace period, if any, specified in such
agreement or instrument, if the effect of such default or event is to
accelerate, or to permit the acceleration of, the maturity of such Indebtedness;
or any such Indebtedness shall be declared to be due and payable, or required to
be prepaid (other than by a regularly scheduled required prepayment), redeemed,
purchased or defeased or an offer to prepay, redeem, purchase or defease such
Indebtedness shall be required to be made, in each case, prior to the stated
maturity thereof;

(f) the Borrower or any of its Subsidiaries (i) shall institute any proceeding
or voluntary case seeking to adjudicate it a bankrupt or insolvent, or seeking
dissolution, liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief or composition of it or its debts under any law relating to
bankruptcy, insolvency, reorganization or relief of debtors, or seeking the
entry of an order for relief or the appointment of a receiver, trustee,
custodian or other similar official for any such Person or for any substantial
part of its property, (ii) shall be generally not paying its debts as such debts
become due or shall admit in writing its inability to pay its debts generally,
(iii) shall make a general assignment for the benefit of creditors, or
(iv) shall take any action to authorize or effect any of the actions set forth
above in this subsection (f);

(g) any proceeding shall be instituted against the Borrower or any of its
Subsidiaries seeking to adjudicate it a bankrupt or insolvent, or seeking
dissolution, liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief of debtors, or seeking the entry of an order for relief or
the appointment of a receiver, trustee, custodian or other similar official for
any such Person or for any substantial part of its property, and either such
proceeding shall remain undismissed or unstayed for a period of 60 days or any
of the actions sought in such proceeding (including the entry of an order for
relief against any such Person or the appointment of a receiver, trustee,
custodian or other similar official for it or for any substantial part of its
property) shall occur;

(h) any material provision of any Loan Document shall at any time for any reason
(other than pursuant to the express terms thereof) cease to be valid and binding
on or enforceable against any Loan Party intended to be a party thereto, or the
validity or enforceability thereof shall be contested by any party thereto, or a
proceeding shall be commenced by any Loan Party or any Governmental Authority
having jurisdiction over any of them, seeking to establish the invalidity or
unenforceability thereof, or any Loan Party shall deny in writing that it has
any liability or obligation purported to be created under any Loan Document;

(i) any Security Agreement, any Mortgage or any other security document, after
delivery thereof pursuant hereto, shall for any reason fail or cease to create a
valid and perfected and, except to the extent permitted by the terms hereof or
thereof, second priority Lien (subject to Permitted Liens) in favor of the
Collateral Agent for the benefit of the Agents and the Lenders on any material
item of Collateral or any material portion of the Collateral purported to be
covered thereby;

(j) any bank at which any deposit account, blocked account, or lockbox account
of any Loan Party is maintained shall fail to comply with any of the terms of
any deposit account, blocked account, lockbox account or similar agreement to
which such bank is a party after notice thereof from an Agent to the Borrower or
any securities intermediary, commodity intermediary or other financial
institution at any time in custody, control or possession of any investment
property of any Loan Party shall fail to comply with any of the terms of any
investment property control agreement to which such Person is a party after
notice thereof from an Agent to the Borrower;

(k) one or more judgments, awards, or orders (or any settlement of any claim
that, if breached, could result in a judgment, order, or award) for the payment
of money exceeding $500,000 in the aggregate shall be rendered against Borrower
or any of its Subsidiaries and remain unsatisfied, or the Borrower or any of its
Subsidiaries shall agree to the settlement of any one or more pending or
threatened actions, suits, or proceedings affecting any Loan Party before any
court or other Governmental Authority or any arbitrator or mediator, providing
for the payment of money exceeding $500,000 in the aggregate, and in the case of
any such judgment or order either (i) enforcement proceedings shall have been
commenced by any creditor upon any such judgment, order, award or settlement, or
(ii) there shall be a period of 10 consecutive days after entry thereof during
which a stay of enforcement of any such judgment, order, award or settlement, by
reason of a pending appeal or otherwise, shall not be in effect; provided,
however, that any such judgment, order, award or settlement shall not give rise
to an Event of Default under this subsection if and for so long as (A) the
amount of such judgment, order, award or settlement is covered by a valid and
binding policy of insurance between the defendant and the insurer covering full
payment thereof and (B) such insurer has been notified, and has not disputed the
claim made for payment, of the amount of such judgment, order, award or
settlement;

(l) the Borrower or any of its Subsidiaries is enjoined, restrained or in any
way prevented by the order of any court or any Governmental Authority from
conducting all or any material part of its business for more than 15 days;

(m) any material damage to, or loss, theft or destruction of, any Collateral,
whether or not insured, or any strike, lockout, labor dispute, embargo,
condemnation, act of God or public enemy, or other casualty which causes, for
more than 15 days, the cessation or substantial curtailment of revenue producing
activities at any facility of any Loan Party, if any such event or circumstance
could reasonably be expected to result in a Material Adverse Effect;

(n) any cessation of a substantial part of the business of any Loan Party for a
period which materially and adversely affects the ability of such Loan Party to
continue its business on a profitable basis;

(o) the loss, suspension or revocation of, or failure to renew, any license or
permit now held or hereafter acquired by the Borrower or any of its
Subsidiaries, if such loss, suspension, revocation or failure to renew could
reasonably be expected to result in a Material Adverse Effect;

(p) the indictment, or the threatened indictment of the Borrower or any of its
Subsidiaries under any criminal statute, or commencement or threatened
commencement of criminal or civil proceedings against any Loan Party, pursuant
to which statute or proceedings the penalties or remedies sought or available
include forfeiture to any Governmental Authority of any material portion of the
property of such Person;

(q) any Loan Party or any of its ERISA Affiliates shall have made a complete or
partial withdrawal from a Multiemployer Plan, and, as a result of such complete
or partial withdrawal, any Loan Party or any of its ERISA Affiliates incurs a
withdrawal liability in an annual amount exceeding $250,000; or a Multiemployer
Plan enters reorganization status under Section 4241 of ERISA, and, as a result
thereof any Loan Party’s or any of its ERISA Affiliates’ annual contribution
requirements with respect to such Multiemployer Plan increases in an annual
amount exceeding $250,000;

(r) any Termination Event with respect to any Employee Plan shall have occurred,
and, 30 days after notice thereof shall have been given to any Loan Party by any
Agent, (i) such Termination Event (if correctable) shall not have been
corrected, and (ii) the then current value of such Employee Plan’s vested
benefits exceeds the then current value of assets allocable to such benefits in
such Employee Plan by more than $100,000 (or, in the case of a Termination Event
involving liability under Section 409, 502(i), 502(l), 515, 4062, 4063, 4064,
4069, 4201, 4204 or 4212 of ERISA or Section 4971 or 4975 of the IRC, the
liability is in excess of such amount);

(s) the Borrower or any of its Subsidiaries shall be liable for any
Environmental Liabilities and Costs the payment of which could reasonably be
expected to result in a Material Adverse Effect;

(t) a Change of Control shall have occurred; or

(u) an event or development occurs which could reasonably be expected to result
in a Material Adverse Effect;

then, and in any such event, the Collateral Agent may, and shall at the request
of the Required Lenders, by notice to the Borrower, (i) terminate all
Commitments, whereupon all Commitments shall immediately be so terminated,
(ii) declare all or any portion of the Loans then outstanding to be due and
payable, whereupon all or such portion of the aggregate principal of all Loans,
all accrued and unpaid interest thereon, all fees and all other amounts payable
under this Agreement and the other Loan Documents shall become due and payable
immediately, without presentment, demand, protest or further notice of any kind,
all of which are hereby expressly waived by each Loan Party and (iii) exercise
any and all of its other rights and remedies under applicable law, hereunder and
under the other Loan Documents; provided, however, that upon the occurrence of
any Event of Default described in subsection (f) or (g) of this Section 9.01,
without any notice to any Loan Party or any other Person or any act by any Agent
or any Lender, all Commitments shall automatically terminate and all Loans then
outstanding, together with all accrued and unpaid interest thereon, all fees and
all other amounts due under this Agreement and the other Loan Documents shall
become due and payable automatically and immediately, without presentment,
demand, protest or notice of any kind, all of which are expressly waived by each
Loan Party.

ARTICLE X

AGENTS

Section 10.01 Appointment. Each Lender (and each subsequent maker of any Loan by
its making thereof) hereby irrevocably appoints and authorizes the
Administrative Agent and the Collateral Agent to perform the duties of each such
Agent as set forth in this Agreement including: (i) to receive on behalf of each
Lender any payment of principal of or interest on the Loans outstanding
hereunder and all other amounts accrued hereunder for the account of the Lenders
and paid to such Agent, and, subject to Section 2.02 of this Agreement, to
distribute promptly to each Lender its Pro Rata Share of all payments so
received; (ii) to distribute to each Lender copies of all material notices and
agreements received by such Agent and not required to be delivered to each
Lender pursuant to the terms of this Agreement, provided that the Agents shall
not have any liability to the Lenders for any Agent’s inadvertent failure to
distribute any such notices or agreements to the Lenders; (iii) to maintain, in
accordance with its customary business practices, ledgers and records reflecting
the status of the Obligations, the Loans, and related matters and to maintain,
in accordance with its customary business practices, ledgers and records
reflecting the status of the Collateral and related matters; (iv) to execute or
file any and all financing or similar statements or notices, amendments,
renewals, supplements, documents, instruments, proofs of claim, notices and
other written agreements with respect to this Agreement or any other Loan
Document; (v) to make the Loans and Collateral Agent Advances, for such Agent or
on behalf of the applicable Lenders as provided in this Agreement or any other
Loan Document; (vi) to perform, exercise, and enforce any and all other rights
and remedies of the Lenders with respect to the Loan Parties, the Obligations,
or otherwise related to any of same to the extent reasonably incidental to the
exercise by such Agent of the rights and remedies specifically authorized to be
exercised by such Agent by the terms of this Agreement or any other Loan
Document; (vii)  to incur and pay such fees necessary or appropriate for the
performance and fulfillment of its functions and powers pursuant to this
Agreement or any other Loan Document; and (viii) subject to Section 10.03 of
this Agreement, to take such action as such Agent deems appropriate on its
behalf to administer the Loans and the Loan Documents and to exercise such other
powers delegated to such Agent by the terms hereof or the other Loan Documents
(including the power to give or to refuse to give notices, waivers, consents,
approvals and instructions and the power to make or to refuse to make
determinations and calculations) together with such powers as are reasonably
incidental thereto to carry out the purposes hereof and thereof. As to any
matters not expressly provided for by this Agreement and the other Loan
Documents (including enforcement or collection of the Loans), the Agents shall
not be required to exercise any discretion or take any action, but shall be
required to act or to refrain from acting (and shall be fully protected in so
acting or refraining from acting) upon the instructions of the Required Lenders,
and such instructions of the Required Lenders shall be binding upon all Lenders
and all makers of Loans.

Section 10.02 Nature of Duties. The Agents shall have no duties or
responsibilities except those expressly set forth in this Agreement or in the
other Loan Documents. The duties of the Agents shall be mechanical and
administrative in nature. The Agents shall not have by reason of this Agreement
or any other Loan Document a fiduciary relationship in respect of any Lender.
Nothing in this Agreement or any other Loan Document, express or implied, is
intended to or shall be construed to impose upon the Agents any obligations in
respect of this Agreement or any other Loan Document except as expressly set
forth herein or therein. Each Lender shall make its own independent
investigation of the financial condition and affairs of the Loan Parties in
connection with the making and the continuance of the Loans hereunder and shall
make its own appraisal of the creditworthiness of the Loan Parties and the value
of the Collateral, and the Agents shall have no duty or responsibility, either
initially or on a continuing basis, to provide any Lender with any credit or
other information with respect thereto, whether coming into their possession
before the initial Loan hereunder or at any time or times thereafter, provided
that, upon the reasonable request of a Lender, each Agent shall provide to such
Lender any documents or reports delivered to such Agent by the Loan Parties
pursuant to the terms of this Agreement or any other Loan Document. If any Agent
seeks the consent or approval of the Required Lenders to the taking or
refraining from taking any action hereunder, such Agent shall send notice
thereof to each Lender. Each Agent shall promptly notify each Lender any time
that the Required Lenders have instructed such Agent to act or refrain from
acting pursuant hereto.

Section 10.03 Rights, Exculpation, Etc. The Agents and their directors,
officers, agents or employees shall not be liable for any action taken or
omitted to be taken by them under or in connection with this Agreement or the
other Loan Documents, except for their own gross negligence or willful
misconduct as determined by a final judgment of a court of competent
jurisdiction. Without limiting the generality of the foregoing, the Agents
(i) may treat the payee of any Loan as the owner thereof until the Collateral
Agent receives written notice of the assignment or transfer thereof, pursuant to
Section 12.07 hereof, signed by such payee and in form satisfactory to the
Collateral Agent; (ii) may consult with legal counsel (including counsel to any
Agent or counsel to the Loan Parties), independent public accountants, and other
experts selected by any of them and shall not be liable for any action taken or
omitted to be taken in good faith by any of them in accordance with the advice
of such counsel or experts; (iii) make no warranty or representation to any
Lender and shall not be responsible to any Lender for any statements,
certificates, warranties or representations made in or in connection with this
Agreement or the other Loan Documents; (iv) shall not have any duty to ascertain
or to inquire as to the performance or observance of any of the terms, covenants
or conditions of this Agreement or the other Loan Documents on the part of any
Person, the existence or possible existence of any Default or Event of Default,
or to inspect the Collateral or other property (including the books and records)
of any Person; (v) shall not be responsible to any Lender for the due execution,
legality, validity, enforceability, genuineness, sufficiency or value of this
Agreement or the other Loan Documents or any other instrument or document
furnished pursuant hereto or thereto; and (vi) shall not be deemed to have made
any representation or warranty regarding the existence, value or collectability
of the Collateral, the existence, priority or perfection of the Collateral
Agent’s Lien thereon, or any certificate prepared by any Loan Party in
connection therewith, nor shall the Agents be responsible or liable to the
Lenders for any failure to monitor or maintain any portion of the Collateral.
The provisions of this Section 10.03 are subject to, and shall not limit in any
respect, the provisions of Section 12.07. The Agents shall not be liable for any
apportionment or distribution of payments made in good faith pursuant to
Section 4.04, and if any such apportionment or distribution is subsequently
determined to have been made in error the sole recourse of any Lender to whom
payment was due but not made, shall be to recover from other Lenders any payment
in excess of the amount which they are determined to be entitled. The Agents may
at any time request instructions from the Lenders with respect to any actions or
approvals which by the terms of this Agreement or of any of the other Loan
Documents the Agents are permitted or required to take or to grant, and if such
instructions are promptly requested, the Agents shall be absolutely entitled to
refrain from taking any action or to withhold any approval under any of the Loan
Documents until they shall have received such instructions from the Required
Lenders. Without limiting the foregoing, no Lender shall have any right of
action whatsoever against any Agent as a result of such Agent acting or
refraining from acting under this Agreement or any of the other Loan Documents
in accordance with the instructions of the Required Lenders.

Section 10.04 Reliance. Each Agent shall be entitled to rely upon any written
notices, statements, certificates, orders or other documents or any telephone
message believed by it in good faith to be genuine and correct and to have been
signed, sent or made by the proper Person, and with respect to all matters
pertaining to this Agreement or any of the other Loan Documents and its duties
hereunder or thereunder, upon advice of counsel selected by it.

Section 10.05 Indemnification. To the extent that any Agent is not reimbursed
and indemnified by any Loan Party, the Lenders will reimburse and indemnify such
Agent from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses, advances or disbursements
of any kind or nature whatsoever which may be imposed on, incurred by, or
asserted against such Agent in any way relating to or arising out of this
Agreement or any of the other Loan Documents or any action taken or omitted by
such Agent under this Agreement or any of the other Loan Documents, in
proportion to each Lender’s Pro Rata Share, including advances and disbursements
made pursuant to Section 10.08; provided, however, that no Lender shall be
liable for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses, advances or disbursements
for which there has been a final judicial determination that such liability
resulted from such Agent’s gross negligence or willful misconduct. The
obligations of the Lenders under this Section 10.05 shall survive the payment in
full of the Loans and the termination of this Agreement.

Section 10.06 Agents Individually. With respect to its Pro Rata Share of the
Total Commitment hereunder and the Loans made by it, each Agent shall have and
may exercise the same rights and powers hereunder and is subject to the same
obligations and liabilities as and to the extent set forth herein for any other
Lender or maker of a Loan. The terms “Lenders” or “Required Lenders” or any
similar terms shall, unless the context clearly otherwise indicates, include
each Agent in its individual capacity as a Lender or one of the Required
Lenders. Each Agent and its Affiliates may accept deposits from, lend money to,
and generally engage in any kind of banking, trust or other business with the
Borrower as if it were not acting as an Agent pursuant hereto without any duty
to account to the other Lenders.

Section 10.07 Successor Agent. (a)  Each Agent may resign from the performance
of all its functions and duties hereunder and under the other Loan Documents at
any time by giving at least 30 Business Days prior written notice to the
Borrower and each Lender. Such resignation shall take effect upon the acceptance
by a successor Agent of appointment pursuant to clauses (b) and (c) below or as
otherwise provided below.

(b) Upon any such notice of resignation, the Required Lenders may appoint a
successor Agent. Upon the acceptance of any appointment as Agent hereunder by a
successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations under
this Agreement and the other Loan Documents. After any Agent’s resignation
hereunder as an Agent, the provisions of this Article X shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was an
Agent under this Agreement and the other Loan Documents.

(c) If a successor Agent shall not have been so appointed within said thirty
(30) Business Day period, the retiring Agent, with the consent of the other
Agent shall then appoint a successor Agent who shall serve as an Agent until
such time, if any, as the Required Lenders, with the consent of the other Agent,
appoint a successor Agent as provided above.

Section 10.08 Collateral Matters.

(a) The Collateral Agent may (but shall not be obligated) from time to time make
such disbursements and advances (“Collateral Agent Advances”) which the
Collateral Agent, in its sole discretion, deems necessary or desirable to
preserve, protect, prepare for sale or lease or dispose of the Collateral or any
portion thereof, to enhance the likelihood or maximize the amount of repayment
by the Borrower of the Loans, and other Obligations or to pay any other amount
chargeable to the Borrower pursuant to the terms of this Agreement, including
costs, fees and expenses as described in Section 12.04. The Collateral Agent
Advances shall be repayable on demand and be secured by the Collateral. The
Collateral Agent Advances shall constitute Obligations hereunder which may be
charged to the Loan Account in accordance with Section 4.02. The Collateral
Agent shall notify each Lender and the Borrower in writing of each such
Collateral Agent Advance, which notice shall include a description of the
purpose of such Collateral Agent Advance. Without limitation to its obligations
pursuant to Section 10.05, each Lender agrees that it shall make available to
the Collateral Agent, upon the Collateral Agent’s demand, in Dollars in
immediately available funds, the amount equal to such Lender’s Pro Rata Share of
each such Collateral Agent Advance. If such funds are not made available to the
Collateral Agent by such Lender, the Collateral Agent shall be entitled to
recover such funds on demand from such Lender, together with interest thereon
for each day from the date such payment was due until the date such amount is
paid to the Collateral Agent, at the Federal Funds Rate for 3 Business Days and
thereafter at the Reference Rate.

(b) The Lenders hereby irrevocably authorize the Collateral Agent, at its option
and in its discretion, to release any Lien granted to or held by the Collateral
Agent upon any Collateral upon termination of the Total Commitment and payment
in full in cash of all Obligations (other than unasserted contingent
indemnification Obligations); or constituting property being sold or disposed of
in compliance with the terms of this Agreement and the other Loan Documents; or
constituting property in which the Loan Parties owned no interest at the time
the Lien was granted or at any time thereafter; or if approved, authorized or
ratified in writing by the Lenders. Upon request by the Collateral Agent at any
time, the Lenders will confirm in writing the Collateral Agent’s authority to
release particular types or items of Collateral pursuant to this
Section 10.08(b).

(c) Without in any manner limiting the Collateral Agent’s authority to act
without any specific or further authorization or consent by the Lenders (as set
forth in Section 10.08(b)), each Lender agrees to confirm in writing, upon
request by the Collateral Agent, the authority to release Collateral conferred
upon the Collateral Agent under Section 10.08(b). Upon receipt by the Collateral
Agent of confirmation from the Lenders of its authority to release any
particular item or types of Collateral, and upon prior written request by any
Loan Party, the Collateral Agent shall (and is hereby irrevocably authorized by
the Lenders to) execute such documents as may be necessary to evidence the
release of the Liens granted to the Collateral Agent for the benefit of the
Agents and the Lenders upon such Collateral; provided, however, that (i) the
Collateral Agent shall not be required to execute any such document on terms
which, in the Collateral Agent’s opinion, would expose the Collateral Agent to
liability or create any obligations or entail any consequence other than the
release of such Liens without recourse or warranty, and (ii) such release shall
not in any manner discharge, affect or impair the Obligations or any Lien upon
(or obligations of any Loan Party in respect of) all interests in the Collateral
retained by any Loan Party.

(d) The Collateral Agent shall have no obligation whatsoever to any Lender to
assure that the Collateral exists or is owned by the Loan Parties or is cared
for, protected or insured or has been encumbered or that the Lien granted to the
Collateral Agent pursuant to this Agreement or any other Loan Document has been
properly or sufficiently or lawfully created, perfected, protected or enforced
or is entitled to any particular priority, or to exercise at all or in any
particular manner or under any duty of care, disclosure or fidelity, or to
continue exercising, any of the rights, authorities and powers granted or
available to the Collateral Agent in this Section 10.08 or in any other Loan
Document, it being understood and agreed that in respect of the Collateral, or
any act, omission or event related thereto, the Collateral Agent may act in any
manner it may deem appropriate, in its sole discretion, given the Collateral
Agent’s own interest in the Collateral as one of the Lenders and that the
Collateral Agent shall have no duty or liability whatsoever to any other Lender,
except as otherwise provided herein.

Section 10.09 Agency for Perfection. Each Lender hereby appoints each Agent and
each other Lender as agent and bailee for the purpose of perfecting the security
interests in and liens upon the Collateral in assets which, in accordance with
Article 9 of the Code, can be perfected only by possession or control (or where
the security interest of a secured party with possession or control has priority
over the security interest of another secured party) and each Agent and each
Lender hereby acknowledges that it holds possession or control of any such
Collateral for the benefit of the Collateral Agent as secured party. Should any
Lender obtain possession or control of any such Collateral, such Lender shall
notify the Collateral Agent thereof, and, promptly upon the Collateral Agent’s
request therefor shall deliver possession or control of such Collateral to the
Collateral Agent or in accordance with the Collateral Agent’s instructions. Each
Loan Party by its execution and delivery of this Agreement hereby consents to
the foregoing.

ARTICLE XI

GUARANTY

Section 11.01 Guaranty. Each Guarantor hereby jointly and severally
unconditionally and irrevocably guarantees the punctual payment when due,
whether at stated maturity, by acceleration or otherwise, of all Obligations of
the Borrower now or hereafter existing under any Loan Document, whether for
principal, interest (including all interest that accrues after the commencement
of any Insolvency Proceeding irrespective of whether a claim therefor is allowed
in such case or proceeding), fees, expenses or otherwise (such obligations, to
the extent not paid by the Borrower, being the “Guaranteed Obligations”), and
agrees to pay any and all expenses (including reasonable counsel fees and
expenses) incurred by the Agents or the Lenders (or any of them) in enforcing
any rights under the guaranty set forth in this Article. Without limiting the
generality of the foregoing, each Guarantor’s liability shall extend to all
amounts that constitute part of the Guaranteed Obligations and would be owed by
the Borrower to the Agents or the Lenders under any Loan Document but for the
fact that they are unenforceable or not allowable due to the existence of a
bankruptcy, reorganization or similar proceeding involving any Loan Party.

Section 11.02 Guaranty Absolute. Each Guarantor jointly and severally guarantees
that the Guaranteed Obligations will be paid strictly in accordance with the
terms of the Loan Documents, regardless of any law, regulation or order now or
hereafter in effect in any jurisdiction affecting any of such terms or the
rights of the Agents, the Lenders with respect thereto. Each Guarantor agrees
that this Article constitutes a guaranty of payment when due and not of
collection and waives any right to require that any resort be made by any Agent
or any Lender to any Collateral. The obligations of each Guarantor under this
Article are independent of the Guaranteed Obligations, and a separate action or
actions may be brought and prosecuted against each Guarantor to enforce such
obligations, irrespective of whether any action is brought against any Loan
Party or whether any Loan Party is joined in any such action or actions. The
liability of each Guarantor under this Article shall be irrevocable, absolute
and unconditional irrespective of, and each Guarantor hereby irrevocably waives
any defenses it may now or hereafter have in any way relating to, any or all of
the following:

(a) any lack of validity or enforceability of any Loan Document or any agreement
or instrument relating thereto;

(b) any change in the time, manner or place of payment of, or in any other term
of, all or any of the Guaranteed Obligations, or any other amendment or waiver
of or any consent to departure from any Loan Document, including any increase in
the Guaranteed Obligations resulting from the extension of additional credit to
any Loan Party or otherwise;

(c) any taking, exchange, release or non-perfection of any Collateral, or any
taking, release or amendment or waiver of or consent to departure from any other
guaranty, for all or any of the Guaranteed Obligations;

(d) the existence of any claim, set-off, defense or other right that any
Guarantor may have at any time against any Person, including, without
limitation, any Agent or any Lender;

(e) any change, restructuring or termination of the corporate, limited liability
company or partnership structure or existence of any Loan Party; or

(f) any other circumstance (including any statute of limitations) or any
existence of or reliance on any representation by the Agents, the Lenders that
might otherwise constitute a defense available to, or a discharge of, any Loan
Party or any other guarantor or surety.

This Article shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Guaranteed Obligations is rescinded
or must otherwise be returned by the Agents, the Lenders, or any other Person
upon the insolvency, bankruptcy or reorganization of the Borrower or otherwise,
all as though such payment had not been made.

Section 11.03 Waiver. Each Guarantor hereby waives (i) promptness and diligence,
(ii) notice of acceptance and any other notice with respect to any of the
Guaranteed Obligations and this Article and any requirement that the Agents or
the Lenders exhaust any right or take any action against any Loan Party or any
other Person or any Collateral, (iii) any right to compel or direct any Agent or
any Lender to seek payment or recovery of any amounts owed under this Article
from any one particular fund or source or to exhaust any right or take any
action against any other Loan Party, any other Person or any Collateral,
(iv) any requirement that any Agent or any Lender protect, secure, perfect or
insure any security interest or Lien on any property subject thereto or exhaust
any right to take any action against any Loan Party, any other Person or any
Collateral, and (v) any other defense available to any Guarantor. Each Guarantor
agrees that the Agents and the Lenders shall have no obligation to marshal any
assets in favor of any Guarantor or against, or in payment of, any or all of the
Obligations. Each Guarantor acknowledges that it will receive direct and
indirect benefits from the financing arrangements contemplated herein and that
the waiver set forth in this Section 11.03 is knowingly made in contemplation of
such benefits. Each Guarantor hereby waives any right to revoke this Article,
and acknowledges that this Article is continuing in nature and applies to all
Guaranteed Obligations, whether existing now or in the future.

Section 11.04 Continuing Guaranty; Assignments. This Article is a continuing
guaranty and shall (a) remain in full force and effect until the later of
(i) the cash payment in full of the Guaranteed Obligations (other than
indemnification obligations as to which no claim has been made) and all other
amounts payable under this Article and (ii) the Final Maturity Date, (b) be
binding upon each Guarantor, its successors and assigns and (c) inure to the
benefit of and be enforceable by the Agents and the Lenders and their
successors, pledgees, transferees and assigns. Without limiting the generality
of the foregoing clause (c), any Lender may pledge, assign or otherwise transfer
all or any portion of its rights and obligations under this Agreement (including
all or any portion of its Commitments or its Loans) to any other Person, and
such other Person shall thereupon become vested with all the benefits in respect
thereof granted such Lender herein or otherwise, in each case as provided in
Section 12.07.

Section 11.05 Subrogation. No Guarantor will exercise any rights that it may now
or hereafter acquire against any Loan Party or any other guarantor that arise
from the existence, payment, performance or enforcement of such Guarantor’s
obligations under this Article, including any right of subrogation,
reimbursement, exoneration, contribution or indemnification and any right to
participate in any claim or remedy of the Agents and the Lenders against any
Loan Party or any other guarantor or any Collateral, whether or not such claim,
remedy or right arises in equity or under contract, statute or common law,
including the right to take or receive from any Loan Party or any other
guarantor, directly or indirectly, in cash or other property or by set-off or in
any other manner, payment or security solely on account of such claim, remedy or
right, unless and until all of the Guaranteed Obligations and all other amounts
payable under this Article shall have been paid in full in cash and all of the
Commitments have been terminated. If any amount shall be paid to any Guarantor
in violation of the immediately preceding sentence, such amount shall be held in
trust for the benefit of the Agents and the Lenders and shall forthwith be paid
to the Agents and the Lenders to be credited and applied to the Guaranteed
Obligations and all other amounts payable under this Article, whether matured or
unmatured, in accordance with the terms of this Agreement, or to be held as
Collateral for any Guaranteed Obligations or other amounts payable under this
Article thereafter arising. If (i) any Guarantor shall make payment to the
Agents and the Lenders of all or any part of the Guaranteed Obligations,
(ii) all of the Guaranteed Obligations and all other amounts payable under this
Article shall be paid in full in cash and (iii) all Commitments have been
terminated, the Agents and the Lenders will, at such Guarantor’s request and
expense, execute and deliver to such Guarantor appropriate documents, without
recourse and without representation or warranty, necessary to evidence the
transfer by subrogation to such Guarantor of an interest in the Guaranteed
Obligations resulting from such payment by such Guarantor.

ARTICLE XII

MISCELLANEOUS

Section 12.01 Notices, Etc. All notices and other communications provided for
hereunder shall be in writing and shall be mailed, telecopied or delivered, if
to any Loan Party, at the following address:

c/o METALICO, INC.

186 North Avenue East

Cranford, New Jersey 07016

Attention: Chief Financial Officer

Telephone: 908-497-9610

Telecopier: 908-497-1097

with a copy to:

METALICO, INC.

186 North Avenue East

Cranford, New Jersey 07016

Attention: General Counsel

Telephone: 908-497-9610

Telecopier: 908-497-1097

and to:

LOWENSTEIN SANDLER PC

65 Livingston Avenue

Roseland, New Jersey 07068

Attention: Steven M. Skolnick, Esq.

Telephone: 973-597-2500

Telecopier: 973-597-2400

if to the Administrative Agent, to it at the following address:

ABLECO FINANCE LLC

299 Park Avenue, 24th Floor

New York, New York 10171

Attention: Daniel Wolf

Telephone: 212-891-2121

Telecopier: 212-891-1541

with a copy to:

CERBERUS CALIFORNIA, INC.

11812 San Vicente Boulevard, Suite 300

Los Angeles, California 90049

Attention: Michael B. Grenier; Christopher R. Hebble

Telephone: (310) 903-5010

Telecopier: (310) 826-9203

with an additional copy to:

PAUL, HASTINGS, JANOFSKY & WALKER LLP

515 South Flower Street

Los Angeles, CA 90071

Attention: John Francis Hilson, Esq.

Telephone: 213-683-6300

Telecopier: 213-996-3300

if to the Collateral Agent, to it at the following address:

ABLECO FINANCE LLC

299 Park Avenue, 24th Floor

New York, New York 10171

Attention: Daniel Wolf

Telephone: 212-891-2121

Telecopier: 212-891-1541

with a copy to:

CERBERUS CALIFORNIA, INC.

11812 San Vicente Boulevard, Suite 300

Los Angeles, California 90049

Attention: Michael B. Grenier; Christopher R. Hebble

Telephone: (310) 903-5010

Telecopier: (310) 826-9203

with an additional copy to:

PAUL, HASTINGS, JANOFSKY & WALKER LLP

515 South Flower Street

Los Angeles, CA 90071

Attention: John Francis Hilson, Esq.

Telephone: 213-683-6300

Telecopier: 213-996-3300

or, as to each party, at such other address as shall be designated by such party
in a written notice to the other parties complying as to delivery with the terms
of this Section 12.01. All such notices and other communications shall be
effective, (i) if mailed, when received or 3 days after deposited in the mails,
whichever occurs first, (ii) if telecopied, when transmitted and confirmation
received, or (iii) if delivered, upon delivery, except that notices to any Agent
pursuant to Articles II and III shall not be effective until received by such
Agent , as the case may be.

Section 12.02 Amendments, Etc. No amendment or waiver of any provision of this
Agreement or any other Loan Document, and no consent to any departure by any
Loan Party therefrom, shall in any event be effective unless the same shall be
in writing and signed by the Required Lenders or by the Collateral Agent with
the consent of the Required Lenders, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given, provided, however, that no amendment, waiver or consent shall
(i) increase the Commitment of any Lender, reduce the principal of, or interest
on, the Loans payable to any Lender, reduce the amount of any fee payable for
the account of any Lender, or postpone or extend any date fixed for any payment
of principal of, or interest or fees on, the Loans payable to any Lender, in
each case without the written consent of any Lender affected thereby,
(ii) increase the Total Commitment without the written consent of each Lender,
(iii) change the percentage of the Commitments or of the aggregate unpaid
principal amount of the Loans that is required for the Lenders or any of them to
take any action hereunder, (iv) amend the definition of “Required Lenders” or
“Pro Rata Share”, (v) release all or a substantial portion of the Collateral
(except as otherwise provided in this Agreement and the other Loan Documents),
subordinate any Lien granted in favor of the Collateral Agent for the benefit of
the Agents and the Lenders, or release the Borrower or any Guarantor, or
(vi) amend, modify or waive Section 4.04 or this Section 12.02 of this
Agreement, in each case, without the written consent of each Lender.
Notwithstanding the foregoing, no amendment, waiver or consent shall, unless in
writing and signed by an Agent, affect the rights or duties of such Agent (but
not in its capacity as a Lender) under this Agreement or the other Loan
Documents.

Section 12.03 No Waiver; Remedies, Etc. No failure on the part of any Agent or
any Lender to exercise, and no delay in exercising, any right hereunder or under
any other Loan Document shall operate as a waiver thereof; nor shall any single
or partial exercise of any right under any Loan Document preclude any other or
further exercise thereof or the exercise of any other right. The rights and
remedies of the Agents and the Lenders provided herein and in the other Loan
Documents are cumulative and are in addition to, and not exclusive of, any
rights or remedies provided by law. The rights of the Agents and the Lenders
under any Loan Document against any party thereto are not conditional or
contingent on any attempt by the Agents and the Lenders to exercise any of their
rights under any other Loan Document against such party or against any other
Person.

Section 12.04 Expenses; Taxes; Attorneys’ Fees. The Borrower will pay on demand,
all costs and expenses incurred by or on behalf of each Agent (and, in the case
of clauses (b) through (m) below, each Lender), regardless of whether the
transactions contemplated hereby are consummated, including reasonable fees,
costs, client charges and expenses of counsel for each Agent (and, in the case
of clauses (c) through (m) below, each Lender), accounting, due diligence,
periodic field audits, physical counts, valuations, investigations, searches and
filings, monitoring of assets, appraisals of Collateral, title searches and
reviewing environmental assessments, miscellaneous disbursements, examination,
travel, lodging and meals, arising from or relating to: (a) the negotiation,
preparation, execution, delivery, performance and administration of this
Agreement and the other Loan Documents (including the preparation of any
additional Loan Documents pursuant to Section 7.01(b) or the review of any of
the agreements, instruments and documents referred to in Section 7.01(f)),
(b) any syndication of the Loans or the Commitments, (c) any requested
amendments, waivers or consents to this Agreement or the other Loan Documents
whether or not such documents become effective or are given, (d) the
preservation and protection of any of the Lenders’ rights under this Agreement
or the other Loan Documents, (e) the defense of any claim or action asserted or
brought against any Agent or any Lender by any Person that arises from or
relates to this Agreement, any other Loan Document, the Agents’ or the Lenders’
claims against any Loan Party, or any and all matters in connection therewith,
(f) the commencement or defense of, or intervention in, any court proceeding
arising from or related to this Agreement or any other Loan Document, (g) the
filing of any petition, complaint, answer, motion or other pleading by any Agent
or any Lender, or the taking of any action in respect of the Collateral or other
security, in connection with this Agreement or any other Loan Document, (h) the
protection, collection, lease, sale, taking possession of or liquidation of, any
Collateral or other security in connection with this Agreement or any other Loan
Document, (i) any attempt to enforce any Lien or security interest in any
Collateral or other security in connection with this Agreement or any other Loan
Document, (j) any attempt to collect from any Loan Party, (k) all liabilities
and costs arising from or in connection with the past, present or future
operations of any Loan Party involving any damage to real or personal property
or natural resources alleged to have resulted from any Release of Hazardous
Materials or any harm or injury alleged to have resulted from any Release of
Hazardous Materials on, upon or into such property, (l) any Environmental
Liabilities and Costs incurred in connection with the investigation, removal,
cleanup or remediation of any Hazardous Materials present or arising out of the
operations of any facility owned or operated by any Loan Party, (m) any
Environmental Liabilities and Costs incurred in connection with any
Environmental Lien upon any property owned or operated by any Loan Party, or
(n) the receipt by any Agent or any Lender of any advice from professionals with
respect to any of the foregoing. Without limitation of the foregoing or any
other provision of any Loan Document: (x) the Borrower agrees to pay all stamp,
document, transfer, recording or filing taxes or fees and similar impositions
now or hereafter determined by any Agent or any Lender to be payable in
connection with this Agreement or any other Loan Document, and the Borrower
agrees to save each Agent and each Lender harmless from and against any and all
present or future claims, liabilities or losses with respect to or resulting
from any omission to pay or delay in paying any such taxes, fees or impositions,
(y) the Borrower agrees to pay all broker fees that may become due in connection
with the transactions contemplated by this Agreement and the other Loan
Documents, and (z) if the Borrower fails to perform any covenant or agreement
contained herein or in any other Loan Document, any Agent may itself perform or
cause performance of such covenant or agreement, and the expenses of such Agent
incurred in connection therewith shall be reimbursed on demand by the Borrower.

Section 12.05 Right of Set-off.

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

(b) If, at any time or times any Lender shall receive (i) by payment,
foreclosure, setoff, or otherwise, any proceeds of Collateral or any payments
with respect to the Obligations, except for any such proceeds or payments
received by such Lender from Administrative Agent pursuant to the terms of this
Agreement, or (ii) payments from Administrative Agent in excess of such Lender’s
ratable portion of all such distributions by Administrative Agent, such Lender
promptly shall (1) turn the same over to Administrative Agent, in kind, and with
such endorsements as may be required to negotiate the same to Administrative
Agent, or in immediately available funds, as applicable, for the account of all
of the Lenders and for application to the Obligations in accordance with the
applicable provisions of this Agreement, or (2) purchase, without recourse or
warranty, an undivided interest and participation in the Obligations owed to the
other Lenders so that such excess payment received shall be applied ratably as
among the Lenders in accordance with their Pro Rata Shares; provided, however,
that to the extent that such excess payment received by the purchasing party is
thereafter recovered from it, those purchases of participations shall be
rescinded in whole or in part, as applicable, and the applicable portion of the
purchase price paid therefor shall be returned to such purchasing party, but
without interest except to the extent that such purchasing party is required to
pay interest in connection with the recovery of the excess payment.

Section 12.06 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 portions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction.

Section 12.07 Assignments and Participations.

(a) This Agreement and the other Loan Documents shall be binding upon and inure
to the benefit of each Loan Party and each Agent and each Lender and their
respective successors and assigns; provided, however, that none of the Loan
Parties may assign or transfer any of its rights hereunder or under the other
Loan Documents without the prior written consent of each Lender and any such
assignment without the Lenders’ prior written consent shall be null and void.

(b) Each Lender may with the written consent of the Collateral Agent, assign to
one or more other lenders or other entities all or a portion of its rights and
obligations under this Agreement with respect to all or a portion of its
Commitment and Loans made by it; provided, however, that (i) such assignment is
in an amount which is at least $5,000,000 or a multiple of $1,000,000 in excess
thereof (or the remainder of such Lender’s Commitment) (except such minimum
amount shall not apply to an assignment by a Lender to (x) a Lender, an
Affiliate of such Lender or a Related Fund of such Lender or (y) a group of new
Lenders, each of whom is an Affiliate or Related Fund of each other to the
extent the aggregate amount to be assigned to all such new Lenders is at least
$5,000,000 or a multiple of $1,000,000 in excess thereof), and (ii) the parties
to each such assignment shall execute and deliver to the Collateral Agent, for
its acceptance, an Assignment and Acceptance, together with any promissory note
subject to such assignment and such parties shall deliver to the Collateral
Agent, for the benefit of the Collateral Agent, a processing and recordation fee
of $5,000 (except the payment of such fee shall not be required (y) in
connection with an assignment by a Lender to a Lender, an Affiliate of such
Lender or to a Related Fund of such Lender or (z) if Collateral Agent, in its
sole discretion, waives payment of such fee). Upon such execution, delivery and
acceptance, from and after the effective date specified in each Assignment and
Acceptance, which effective date shall be at least 3 Business Days after the
delivery thereof to the Collateral Agent (or such shorter period as shall be
agreed to by the Collateral Agent and the parties to such assignment), (A) the
assignee thereunder shall become a “Lender” hereunder and, in addition to the
rights and obligations hereunder held by it immediately prior to such effective
date, have the rights and obligations hereunder that have been assigned to it
pursuant to such Assignment and Acceptance and (B) the assigning Lender
thereunder shall, to the extent that rights and obligations hereunder have been
assigned by it pursuant to such Assignment and Acceptance, relinquish its rights
and be released from its obligations under this Agreement (and, in the case of
an Assignment and Acceptance covering all or the remaining portion of an
assigning Lender’s rights and obligations under this Agreement, such Lender
shall cease to be a party hereto).

(c) By executing and delivering an Assignment and Acceptance, the assigning
Lender and the assignee thereunder confirm to and agree with each other and the
other parties hereto as follows: (i) other than as provided in such Assignment
and Acceptance, the 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 any other Loan
Document or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement or any other Loan Document furnished
pursuant hereto; (ii) the assigning Lender makes no representation or warranty
and assumes no responsibility with respect to the financial condition of any
Loan Party or any of its Subsidiaries or the performance or observance by any
Loan Party of any of its obligations under this Agreement or any other Loan
Document furnished pursuant hereto; (iii) such assignee confirms that it has
received a copy of this Agreement and the other Loan Documents, together with
such other documents and information it has deemed appropriate to make its own
credit analysis and decision to enter into such Assignment and Acceptance;
(iv) such assignee will, independently and without reliance upon the assigning
Lender, any Agent or any 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; (v) such assignee appoints and authorizes the Agents to take such
action as agents on its behalf and to exercise such powers under this Agreement
and the other Loan Documents as are delegated to the Agents by the terms hereof
and thereof, together with such powers as are reasonably incidental hereto and
thereto; and (vi) such assignee agrees that it will perform in accordance with
their terms all of the obligations which by the terms of this Agreement and the
other Loan Documents are required to be performed by it as a Lender.

(d) The Collateral Agent shall, acting solely for this purpose as a
non-fiduciary agent of the Borrower, maintain, or cause to be maintained at the
Payment Office, a copy of each Assignment and Acceptance delivered to and
accepted by it and a register (the “Register”) for the recordation of the names
and addresses of the Lenders and the Commitments of, and the principal amount of
the Loans (and stated interest thereon) (the “Registered Loans”). The entries in
the Register shall be conclusive and binding for all purposes, absent manifest
error, and the Borrower, the Agents and the Lenders may treat each Person whose
name is recorded in the Register 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.

(e) Upon receipt by the Collateral Agent of an Assignment and Acceptance, and
subject to any consent required from the Collateral Agent pursuant to
Section 12.07(b) (which consent of the Collateral Agent must be evidenced by the
Collateral Agent’s execution of an acceptance to such Assignment and
Acceptance), the Collateral Agent shall accept the Assignment and Acceptance and
record the information contained therein in the Register.

(f) A Registered Loan (and the registered note, if any, evidencing the same) may
be assigned or sold in whole or in part only by registration of such assignment
or sale on the Register (and each registered note shall expressly so provide).
Any assignment or sale of all or part of such Registered Loan (and the
registered note, if any, evidencing the same) may be effected only by
registration of such assignment or sale on the Register, together with the
surrender of the registered note, if any, evidencing the same duly endorsed by
(or accompanied by a written instrument of assignment or sale duly executed by)
the holder of such registered note, whereupon, at the request of the designated
assignee(s) or transferee(s), one or more new registered notes in the same
aggregate principal amount shall be issued to the designated assignee(s) or
transferee(s). Prior to the registration of assignment or sale of any Registered
Loan (and the registered note, if any, evidencing the same), the Agents shall
treat the Person in whose name such Registered Loan (and the registered note, if
any, evidencing the same) is registered as the owner thereof for the purpose of
receiving all payments thereon, notwithstanding notice to the contrary.

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

(h) Any Non-U.S. Lender who is assigned an interest in any portion of such
Registered Loan pursuant to an Assignment and Acceptance shall comply with
Section 2.08(d).

(i) Each Lender may sell participations to one or more banks or other entities
in or to all or a portion of its rights and obligations under this Agreement and
the other Loan Documents (including, all or a portion of its Commitments or the
Loans made by it); provided, that (i) such Lender’s obligations under this
Agreement (including without limitation, its Commitments hereunder) and the
other Loan Documents shall remain unchanged; (ii) such Lender shall remain
solely responsible to the other parties hereto for the performance of such
obligations, and the Borrower, the Agents and the other Lenders 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; and
(iii) a participant shall not be entitled to require such Lender to take or omit
to take any action hereunder except (A) action directly effecting an extension
of the maturity dates or decrease in the principal amount of the Loans,
(B) action directly effecting an extension of the due dates or a decrease in the
rate of interest payable on the Loans or the fees payable under this Agreement,
or (C) actions directly effecting a release of all or a substantial portion of
the Collateral or any Loan Party (except as set forth in Section 10.08 of this
Agreement or any other Loan Document). The Loan Parties agree that each
participant shall be entitled to the benefits of Section 2.08 and Section 4.05
of this Agreement with respect to its participation in any portion of the
Commitments and the Loans as if it was a Lender.

Section 12.08 Counterparts. This Agreement may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which shall be deemed to be an original, but all of which taken together shall
constitute one and the same agreement. Delivery of an executed counterpart of
this Agreement by telefacsimile shall be equally as effective as delivery of an
original executed counterpart of this Agreement. Any party delivering an
executed counterpart of this Agreement by telefacsimile also shall deliver an
original executed counterpart of this Agreement but the failure to deliver an
original executed counterpart shall not affect the validity, enforceability, and
binding effect of this Agreement. The foregoing shall apply to each other Loan
Document mutatis mutandis.

Section 12.09 GOVERNING LAW. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS (UNLESS
EXPRESSLY PROVIDED TO THE CONTRARY IN ANOTHER LOAN DOCUMENT IN RESPECT OF SUCH
OTHER LOAN DOCUMENT) SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAW OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED IN
THE STATE OF NEW YORK.

Section 12.10 CONSENT TO JURISDICTION; SERVICE OF PROCESS AND VENUE. EACH OF THE
PARTIES HERETO AGREE THAT ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT SHALL BE BROUGHT IN THE COURTS OF THE STATE
OF NEW YORK IN THE COUNTY OF NEW YORK OR OF THE UNITED STATES DISTRICT COURT FOR
THE SOUTHERN DISTRICT OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS
AGREEMENT, EACH LOAN PARTY HEREBY IRREVOCABLY ACCEPTS IN RESPECT OF ITS
PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID
COURTS; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY
COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT COLLATERAL AGENT’S OPTION, IN
THE COURTS OF ANY JURISDICTION WHERE COLLATERAL AGENT ELECTS TO BRING SUCH
ACTION OR WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND. EACH LOAN PARTY
HEREBY IRREVOCABLY CONSENTS TO THE SERVICE OF ANY AND ALL LEGAL PROCESS,
SUMMONS, NOTICES, AND DOCUMENTS IN ANY SUIT, ACTION, OR PROCEEDING BROUGHT IN
THE UNITED STATES OF AMERICA ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT
OR ANY OF THE OTHER LOAN DOCUMENTS BY THE MAILING (BY REGISTERED MAIL OR
CERTIFIED MAIL, POSTAGE PREPAID) OR DELIVERING OF A COPY OF SUCH PROCESS TO SUCH
LOAN PARTY, C/O THE BORROWER, AT THE BORROWER’S ADDRESS FOR NOTICES AS SET FORTH
IN SECTION 12.01. THE LOAN PARTIES AGREE THAT A FINAL JUDGMENT IN ANY SUCH
ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER
JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.
NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE AGENTS AND THE LENDERS TO SERVE
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW. EACH LOAN PARTY HEREBY EXPRESSLY
AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION
WHICH IT MAY NOW OR HEREAFTER HAVE TO THE JURISDICTION OR LAYING OF VENUE OF ANY
SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT
ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT
THAT ANY LOAN PARTY HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION
OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE,
ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH
RESPECT TO ITSELF OR ITS PROPERTY, EACH LOAN PARTY HEREBY IRREVOCABLY WAIVES
SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS AGREEMENT AND THE OTHER
LOAN DOCUMENTS.

Section 12.11 WAIVER OF JURY TRIAL, ETC. EACH LOAN PARTY, EACH AGENT AND EACH
LENDER HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM CONCERNING ANY RIGHTS UNDER THIS AGREEMENT OR THE OTHER LOAN
DOCUMENTS, OR UNDER ANY AMENDMENT, WAIVER, CONSENT, INSTRUMENT, DOCUMENT OR
OTHER AGREEMENT DELIVERED OR WHICH IN THE FUTURE MAY BE DELIVERED IN CONNECTION
THEREWITH, OR ARISING FROM ANY FINANCING RELATIONSHIP EXISTING IN CONNECTION
WITH THIS AGREEMENT, AND AGREES THAT ANY SUCH ACTION, PROCEEDINGS OR
COUNTERCLAIM SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY. EACH LOAN
PARTY CERTIFIES THAT NO OFFICER, REPRESENTATIVE, AGENT OR ATTORNEY OF ANY AGENT
OR ANY LENDER HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT ANY AGENT OR ANY
LENDER WOULD NOT, IN THE EVENT OF ANY ACTION, PROCEEDING OR COUNTERCLAIM, SEEK
TO ENFORCE THE FOREGOING WAIVERS. EACH LOAN PARTY HEREBY ACKNOWLEDGES THAT THIS
PROVISION IS A MATERIAL INDUCEMENT FOR THE AGENTS AND THE LENDERS ENTERING INTO
THIS AGREEMENT.

Section 12.12 Consent by the Agents and Lenders. Except as otherwise expressly
set forth herein to the contrary, if the consent, approval, satisfaction,
determination, judgment, acceptance or similar action (an “Action”) of any Agent
or any Lender shall be permitted or required pursuant to any provision hereof or
any provision of any other agreement to which any Loan Party is a party and to
which any Agent or any Lender has succeeded thereto, such Action shall be
required to be in writing and may be withheld or denied by such Agent or such
Lender, in its sole discretion, with or without any reason, and without being
subject to question or challenge on the grounds that such Action was not taken
in good faith.

Section 12.13 No Party Deemed Drafter. Each of the parties hereto agrees that no
party hereto shall be deemed to be the drafter of this Agreement.

Section 12.14 Reinstatement; Certain Payments. If any claim is ever made upon
any Agent or any Lender for repayment or recovery of any amount or amounts
received by such Agent or such Lender in payment or on account of any of the
Obligations, such Agent or such Lender shall give prompt notice of such claim to
each other Agent and Lender and the Borrower, and if such Agent or such Lender
repays all or part of such amount by reason of (i) any judgment, decree or order
of any court or administrative body having jurisdiction over such Agent or such
Lender or any of its property, or (ii) any good faith settlement or compromise
of any such claim effected by such Agent, such Lender with any such claimant,
then and in such event each Loan Party agrees that (A) any such judgment,
decree, order, settlement or compromise shall be binding upon it notwithstanding
the cancellation of any Indebtedness hereunder or under the other Loan Documents
or the termination of this Agreement or the other Loan Documents, and (B) it
shall be and remain liable to such Agent or such Lender hereunder for the amount
so repaid or recovered to the same extent as if such amount had never originally
been received by such Agent or such Lender. The provisions of this Section shall
survive the repayment of the Obligations and release of the Liens granted under
the Loan Documents.

Section 12.15 Indemnification. In addition to each Loan Party’s other
Obligations under this Agreement, each Loan Party agrees to, jointly and
severally, defend, protect, indemnify and hold harmless each Agent, each Lender
and all of their respective officers, directors, employees, attorneys,
consultants and agents (collectively called the “Indemnitees”) from and against
any and all losses, damages, liabilities, obligations, penalties, fees,
reasonable costs and expenses (including reasonable attorneys’ fees, costs and
expenses) incurred by such Indemnitees, whether prior to or from and after the
Effective Date, whether direct, indirect or consequential, as a result of or
arising from or relating to or in connection with any of the following: (i) the
negotiation, preparation, execution or performance or enforcement of this
Agreement, any other Loan Document or of any other document executed in
connection with the transactions contemplated by this Agreement, (ii) any
Agent’s or any Lender’s furnishing of funds to the Borrower under this Agreement
or the other Loan Documents, including the management of any such Loans,
(iii) any matter relating to the financing transactions contemplated by this
Agreement or the other Loan Documents or by any document executed in connection
with the transactions contemplated by this Agreement or the other Loan
Documents, or (iv) any claim, litigation, investigation or proceeding relating
to any of the foregoing, whether or not any Indemnitee is a party thereto
(collectively, the “Indemnified Matters”); provided, however, that the Loan
Parties shall not have any obligation to any Indemnitee under this Section 12.15
for any Indemnified Matter caused by the gross negligence or willful misconduct
of such Indemnitee, as determined by a final judgment of a court of competent
jurisdiction. Such indemnification for all of the foregoing losses, damages,
fees, costs and expenses of the Indemnitees are chargeable against the Loan
Account. To the extent that the undertaking to indemnify, pay and hold harmless
set forth in this Section 12.15 may be unenforceable because it is violative of
any law or public policy, each Loan Party shall, jointly and severally,
contribute the maximum portion which it is permitted to pay and satisfy under
applicable law, to the payment and satisfaction of all Indemnified Matters
incurred by the Indemnitees. This Indemnity shall survive the repayment of the
Obligations and the discharge of the Liens granted under the Loan Documents.

Section 12.16 Records. The unpaid principal of and interest on the Loans, the
interest rate or rates applicable to such unpaid principal and interest, the
duration of such applicability, the Commitments, and the accrued and unpaid fees
payable pursuant to Section 2.06 hereof, including the Term Loan A Closing Fee,
the Term Loan B Closing Fee and the Loan Servicing Fee, shall at all times be
ascertained from the records of the Agents, which shall be conclusive and
binding absent manifest error.

Section 12.17 Binding Effect. This Agreement shall become effective when it
shall have been executed by each Loan Party, each Agent and each Lender and
thereafter shall be binding upon and inure to the benefit of each Loan Party,
each Agent and each Lender, and their respective successors and assigns, except
that the Loan Parties shall not have the right to assign their rights hereunder
or any interest herein without the prior written consent of each Lender, and any
assignment by any Lender shall be governed by Section 12.07 hereof.

Section 12.18 Interest. It is the intention of the parties hereto that each
Agent and each Lender shall conform strictly to usury laws applicable to it.
Accordingly, if the transactions contemplated hereby or by any other Loan
Document would be usurious as to any Agent or any Lender under laws applicable
to it (including the laws of the United States of America and the State of New
York or any other jurisdiction whose laws may be mandatorily applicable to such
Agent or such Lender notwithstanding the other provisions of this Agreement),
then, in that event, notwithstanding anything to the contrary in this Agreement
or any other Loan Document or any agreement entered into in connection with or
as security for the Obligations, it is agreed as follows: (i) the aggregate of
all consideration which constitutes interest under law applicable to any Agent
or any Lender that is contracted for, taken, reserved, charged or received by
such Agent or such Lender under this Agreement or any other Loan Document or
agreements or otherwise in connection with the Obligations shall under no
circumstances exceed the maximum amount allowed by such applicable law, any
excess shall be canceled automatically and if theretofore paid shall be credited
by such Agent or such Lender on the principal amount of the Obligations (or, to
the extent that the principal amount of the Obligations shall have been or would
thereby be paid in full, refunded by such Agent or such Lender, as applicable,
to the Borrower); and (ii) in the event that the maturity of the Obligations is
accelerated by reason of any Event of Default under this Agreement or otherwise,
or in the event of any required or permitted prepayment, then such consideration
that constitutes interest under law applicable to any Agent or any Lender may
never include more than the maximum amount allowed by such applicable law, and
excess interest, if any, provided for in this Agreement or otherwise shall be
canceled automatically by such Agent or such Lender, as applicable, as of the
date of such acceleration or prepayment and, if theretofore paid, shall be
credited by such Agent or such Lender, as applicable, on the principal amount of
the Obligations (or, to the extent that the principal amount of the Obligations
shall have been or would thereby be paid in full, refunded by such Agent or such
Lender to the Borrower). All sums paid or agreed to be paid to any Agent or any
Lender for the use, forbearance or detention of sums due hereunder shall, to the
extent permitted by law applicable to such Agent or such Lender, be amortized,
prorated, allocated and spread throughout the full term of the Loans until
payment in full so that the rate or amount of interest on account of any Loans
hereunder does not exceed the maximum amount allowed by such applicable law. If
at any time and from time to time (i) the amount of interest payable to any
Agent or any Lender on any date shall be computed at the Highest Lawful Rate
applicable to such Agent or such Lender pursuant to this Section 12.18 and
(ii) in respect of any subsequent interest computation period the amount of
interest otherwise payable to such Agent or such Lender would be less than the
amount of interest payable to such Agent or such Lender computed at the Highest
Lawful Rate applicable to such Agent or such Lender, then the amount of interest
payable to such Agent or such Lender in respect of such subsequent interest
computation period shall continue to be computed at the Highest Lawful Rate
applicable to such Agent or such Lender until the total amount of interest
payable to such Agent or such Lender shall equal the total amount of interest
which would have been payable to such Agent or such Lender if the total amount
of interest had been computed without giving effect to this Section 12.18.

For purposes of this Section 12.18, the term “applicable law” shall mean that
law in effect from time to time and applicable to the loan transaction between
the Borrower, on the one hand, and the Agents and the Lenders, on the other,
that lawfully permits the charging and collection of the highest permissible,
lawful non-usurious rate of interest on such loan transaction and this
Agreement, including laws of the State of New York and, to the extent
controlling, laws of the United States of America.

The right to accelerate the maturity of the Obligations does not include the
right to accelerate any interest that has not accrued as of the date of
acceleration.

Section 12.19 Confidentiality. Each Agent and each Lender agrees (on behalf of
itself and each of its affiliates, directors, officers, employees and
representatives) to use reasonable precautions to keep confidential, in
accordance with its customary procedures for handling confidential information
of this nature and in accordance with safe and sound practices of comparable
companies, any material non-public information supplied to it by the Loan
Parties pursuant to this Agreement or the other Loan Documents (and which at the
time is not, and does not thereafter become, publicly available or available to
such Person from another source not known to be subject to a confidentiality
obligation to such Person not to disclose such information), provided that
nothing herein shall limit the disclosure of any such information (i) to the
extent required by statute, rule, regulation or judicial process, (ii) to
counsel for any Agent or any Lender, (iii) to examiners, auditors, accountants
or Securitization Parties, (iv) in connection with any litigation to which any
Agent or any Lender is a party or (v) to any assignee or participant (or
prospective assignee or participant) so long as such assignee or participant (or
prospective assignee or participant) first agrees, in writing, to be bound by
confidentiality provisions similar in substance to this Section 12.19. Each
Agent and each Lender agrees that, upon receipt of a request or identification
of the requirement for disclosure pursuant to clause (iv) hereof, it will make
reasonable efforts to keep the Loan Parties informed of such request or
identification; provided that each Loan Party acknowledges that each Agent and
each Lender may make disclosure as required or requested by any Governmental
Authority or representative thereof and that each Agent and each Lender may be
subject to review by Securitization Parties or other regulatory agencies and may
be required to provide to, or otherwise make available for review by, the
representatives of such parties or agencies any such non-public information.

Section 12.20 Debtor-Creditor Relationship. The relationship between the Lenders
and Agents, on the one hand, and the Loan Parties, on the other hand, is solely
that of creditor and debtor. Neither any Lender or any Agent has (or shall be
deemed to have) any fiduciary relationship or duty to any Loan Party arising out
of or in connection with, and there is no agency or joint venture relationship
between the Agents and the Lenders, on the one hand, and the Loan Parties, on
the other hand, by virtue of any Loan Document or any transaction contemplated
therein.

Section 12.21 Section Headings. Headings and numbers have been set forth herein
for convenience only. Unless the contrary is compelled by the context,
everything contained in each Section applies equally to this entire Agreement.

Section 12.22 Integration. This Agreement, together with the other Loan
Documents, reflects the entire understanding of the parties with respect to the
transactions contemplated hereby and shall not be contradicted or qualified by
any other agreement, oral or written, before the date hereof.

1

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective officers thereunto duly authorized, as of the date first
above written.

BORROWER:

METALICO, INC., a Delaware corporation

By:
Name:
Title:

GUARANTOR:

METALICO-COLLEGE GROVE, INC., a Tennessee corporation

By:
Name:
Title:

TRANZACT CORPORATION, a Delaware corporation

By:
Name:
Title:

METALICO-GRANITE CITY, INC., an Illinois corporation

By:
Name:
Title:

WEST COAST SHOT, INC., a Nevada corporation

By:
Name:
Title:

METALICO ROCHESTER, INC., a New York corporation

By:
Name:
Title:

METALICO BUFFALO, INC., a New York corporation

By:
Name:
Title:

SANTA ROSA LEAD PRODUCTS, INC., a California

corporation

By:
Name:
Title:

GULF COAST RECYCLING, INC., a Florida corporation

By:
Name:
Title:

METALICO ALUMINUM RECOVERY, INC., a New York

corporation

By:
Name:
Title:

METALICO TRANSFER, INC., a New York corporation

By:
Name:
Title:

METALICO TRANSFER REALTY, INC., a New York

corporation

By:
Name:
Title:

METALICO TRANSPORT, INC., a New York corporation

By:
Name:
Title:

MAYCO INDUSTRIES, INC., an Alabama corporation

By:
Name:
Title:

METALICO NILES, INC., an Ohio corporation

By:
Name:
Title:

METALICO NIAGARA, INC., a New York corporation

By:
Name:
Title:

METALICO AKRON INC., an Ohio corporation

By:
Name:
Title:

METALICO AKRON REALTY, INC., an Ohio corporation

By:
Name:
Title:

METALICO SYRACUSE, INC., a New York corporation

By:
Name:
Title:

GENERAL SMELTING & REFINING, INC., a Tennessee

corporation

By:
Name:
Title:

METALICO ALABAMA REALTY, INC., an Alabama corporation

By:
Name:
Title:

METALICO SYRACUSE REALTY, INC., a New York

corporation

By:
Name:
Title:

RIVER HILLS BY THE RIVER, INC., a Florida corporation

By:
Name:
Title:

COLLATERAL AGENT AND LENDER:

ABLECO FINANCE LLC

By:
Name:
Title:

ADMINISTRATIVE AGENT AND LENDER:

ABLECO FINANCE LLC

By:
Name:
Title:

2

FINANCING AGREEMENT

Dated as of July 3, 2007

by and among

METALICO, INC. and various of its Subsidiaries

THE LENDERS FROM TIME TO TIME PARTY HERETO,

ABLECO FINANCE LLC,

as Collateral Agent,

and

ABLECO FINANCE LLC,

as Administrative Agent

                          ARTICLE IDEFINITIONS; CERTAIN TERMS 2
               
Section 1.01
  Definitions     2          
Section 1.02
  Terms Generally     26          
Section 1.03
  Accounting and Other Terms     26          
Section 1.04
  Time References     26          
ARTICLE IITHE LOANS
            27          
Section 2.01
  Commitments     27          
Section 2.02
  Making the Loans     27          
Section 2.03
  Repayment of Loans; Evidence of Debt     30          
Section 2.04
  Interest     31          
Section 2.05
  Reduction of Commitment; Prepayment of Loans     32          
Section 2.06
  Fees     34          
Section 2.07
  Securitization     35          
Section 2.08
  Taxes.     36           ARTICLE IVFEES, PAYMENTS AND OTHER COMPENSATION
    41          
Section 4.01
  Audit and Collateral Monitoring Fees     41          
Section 4.02
  Payments; Computations and Statements     41          
Section 4.03
  Sharing of Payments, Etc     42          
Section 4.04
  Apportionment of Payments.     43          
Section 4.05
  Increased Costs and Reduced Return.     44          
ARTICLE VCONDITIONS TO LOANS
            45          
Section 5.01
  Conditions Precedent     45          
Section 5.02
  Conditions Precedent to All Loans     50           ARTICLE VIREPRESENTATIONS
AND WARRANTIES
    51          
Section 6.01
  Representations and Warranties     51           ARTICLE VIICOVENANTS OF THE
LOAN PARTIES
    59          
Section 7.01
  Affirmative Covenants     59          
Section 7.02
  Negative Covenants     67          
Section 7.03
  Financial Covenants     72           ARTICLE VIIIMANAGEMENT, COLLECTION AND
STATUS OF ACCOUNTS RECEIVABLE AND OTHER COLLATERAL
            73  
Section 8.01
  Collection of Accounts Receivable; Management of Collateral.     73          
Section 8.02
  Accounts Receivable Documentation     76          
Section 8.03
  Status of Accounts Receivable and Other Collateral     76          
Section 8.04
  Collateral Custodian     77          
ARTICLE IXEVENTS OF DEFAULT
            77          
Section 9.01
  Events of Default     77          
ARTICLE XAGENTS
            81          
Section 10.01
  Appointment     81          
Section 10.02
  Nature of Duties     82          
Section 10.03
  Rights, Exculpation, Etc     82          
Section 10.04
  Reliance     83          
Section 10.05
  Indemnification     83          
Section 10.06
  Agents Individually     84          
Section 10.07
  Successor Agent     84          
Section 10.08
  Collateral Matters     84          
Section 10.09
  Agency for Perfection     86          
ARTICLE XIGUARANTY
            86          
Section 11.01
  Guaranty     86          
Section 11.02
  Guaranty Absolute     87          
Section 11.03
  Waiver     87          
Section 11.04
  Continuing Guaranty; Assignments     88          
Section 11.05
  Subrogation     88          
ARTICLE XIIMISCELLANEOUS
            89          
Section 12.01
  Notices, Etc     89          
Section 12.02
  Amendments, Etc     90          
Section 12.03
  No Waiver; Remedies, Etc     91          
Section 12.04
  Expenses; Taxes; Attorneys’ Fees     91          
Section 12.05
  Right of Set-off     92          
Section 12.06
  Severability     92          
Section 12.07
  Assignments and Participations.     92          
Section 12.08
  Counterparts     95          
Section 12.09
  GOVERNING LAW     95          
Section 12.10
  CONSENT TO JURISDICTION; SERVICE OF PROCESS AND VENUE     95          
Section 12.11
  WAIVER OF JURY TRIAL, ETC     96          
Section 12.12
  Consent by the Agents and Lenders     96          
Section 12.13
  No Party Deemed Drafter     97          
Section 12.14
  Reinstatement; Certain Payments     97          
Section 12.15
  Indemnification     97          
Section 12.16
  Records     98          
Section 12.17
  Binding Effect     98          
Section 12.18
  Interest     98          
Section 12.19
  Confidentiality     99          
Section 12.20
  Integration     100          

3

SCHEDULE AND EXHIBITS

     
Schedule C-1
Schedule F-1
Schedule 6.01(e)
Schedule 6.01(f)
Schedule 6.01(i)
Schedule 6.01(l)
Schedule 6.01(o)
Schedule 6.01(q)
Schedule 6.01(r)
Schedule 6.01(s)
Schedule 6.01(v)
Schedule 6.01(w)Intellectual Property
Schedule 6.01(x)
  Lenders and Lenders’ Commitments
Facilities
Subsidiaries
Litigation; Commercial Tort Claims
ERISA
Nature of Business
Real Property
Operating Leases
Environmental Matters
Insurance
Bank Accounts

Material Contracts Schedule 6.01(dd)Name; Jurisdiction of Organization;
Organizational ID Number;

Schedule 6.01(ee)Tradenames
Schedule 6.01(ff)Collateral Locations
Schedule 7.02(a)
Schedule 7.02(b)
Schedule 7.02(e)
Schedule 7.02(k)
Schedule 8.01
  Chief Place of Business; Chief Executive Office; FEIN

Existing Liens
Existing Indebtedness
Existing Investments
Limitations on Dividends and Other Payment Restrictions
Lockbox Banks and Lockbox Accounts

     
Exhibit A-1
Exhibit I-1
Exhibit I-2
Exhibit L-1
Exhibit S-1
Exhibit 2.01(b)(ii)
  Form of Assignment and Acceptance
Form of Intercompany Subordination Agreement
Form of Intercreditor Agreement
Form of LIBOR Notice
Form of Niagara Subordination Agreement
Form of Notice of Borrowing

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