Exhibit 10.28
SIXTH AMENDMENT TO LOAN AND SECURITY AGREEMENT
     This Sixth Amendment to Loan and Security Agreement (the “Sixth Amendment”)
is made as of this 27th day of February, 2007 by and among
     Fleet Retail Group, LLC, f/k/a Fleet Retail Group, Inc., f/k/a Fleet Retail
Finance Inc. (the “Agent”), a Delaware limited liability company with its
principal executive offices at 40 Broad Street, Boston, Massachusetts, for the
Revolving Credit Lenders party to the Agreement (defined below), and
     The Revolving Credit Lenders party to the Agreement, and
     Hastings Entertainment, Inc. (the “Borrower”), a Texas corporation with its
principal executive offices at 3601 Plains Boulevard, Amarillo, Texas 79102;
     in consideration of the mutual covenants herein contained and benefits to
be derived here from.
WITNESSETH:
     WHEREAS, on August 29, 2000, the Agent, the Revolving Credit Lenders and
the Borrower, among others, entered in a certain Loan and Security Agreement (as
amended and in effect, the “Agreement”); and
     WHEREAS, contemporaneously herewith, The CIT Group/Business Credit, Inc. is
assigning 100% of its interest in the Revolving Credit to Fleet Retail Group,
LLC pursuant to that certain Assignment and Acceptance by and between The CIT
Group/Business Credit, Inc. and Fleet Retail Group, LLC dated as of even date
herewith; and
     WHEREAS, the Agent, the Revolving Credit Lenders and the Borrower desire to
modify certain provisions of the Agreement as set forth herein.
     NOW, THEREFORE, it is hereby agreed among the Agent, the Revolving Credit
Lenders and the Borrower as follows:

1.   Capitalized Terms. All capitalized terms used herein and not otherwise
defined shall have the same meaning herein as in the Agreement.

2.   Amendments to Article 1. The provisions of Article 1 of the Agreement are
hereby amended as follows:

  a.   The definition of “Base Margin” is hereby amended by inserting the
following provisions at the end thereof:

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“Notwithstanding the foregoing provisions, commencing on the first day of the
first Fiscal quarter immediately following the effective date of the Sixth
Amendment, the Base Margin shall be the following percentages based upon the
following criteria:

              Level   Average Availability.   Base Margin
I
  Greater than $35,000,000     0.00 %
II
  Greater than $30,000,000 but less than or equal to $35,000,000     0.00 %
III
  Greater than $20,000,000 but less than or equal to $30,000,000     0.00 %
IV
  Less than or equal to $20,000,000     0.00 %

On the first day of each fiscal quarter, the Base Margin shall be adjusted based
upon the Borrower’s aggregate daily Average Availability for the immediately
preceding Fiscal quarter divided by the total number of days in such immediately
preceding Fiscal quarter. Provided, however, upon the occurrence of an Event of
Default, interest shall be determined in the manner set forth in
Section 2-11(f).”

b.   The definition of “Libor Margin” is hereby amended by inserting the
following provisions at the end thereof:

“Notwithstanding the foregoing provisions, commencing on the first day of the
first Fiscal quarter immediately following the effective date of the Sixth
Amendment, the Libor Margin shall be the following percentages based upon the
following criteria:

              Level   Average Availability   Libor Margia
I
  Greater than $35,000,000     1.00 %
II
  Greater than $30,000,000 but less than or equal to $35,000,000     1.25 %
III
  Greater than $20,000,000 but less than or equal to $30,000,000     1.50 %
IV
  less than $20,000,000     1.75 %

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On the first day of each Fiscal quarter, the Libor Margin shall be adjusted
based upon the Borrower’s aggregate daily Average Availability for the
immediately preceding fiscal quarter divided by the total number of days in such
immediately preceding Fiscal quarter. Provided, however, upon the occurrence of
an Event of Default, the Libor Margin shall be immediately increased to the
percentage set forth in Level IV above (even if the Average Availability
requirements for another Level have been met), and interest shall be determined
in the manner set forth in Section 2-11(f).”

  c.   The following new definition is hereby added to the Agreement:

“Sixth Amendment” Shall mean that certain Sixth Amendment to Loan and Security
Agreement dated February 27, 2007 by and among the Borrower, the Agent and the
Revolving Credit Lenders.

3.   Amendment to Article 4. Section 4-19 of the Agreement is hereby amended by
adding the words “following the effective date of the Sixth Amendment” after the
words “$15 Million” in the second line thereof.

4.   Amendments to Exhibits.

  a.   Exhibit 2:2-22 is hereby deleted in its entirety, and is replaced by
Exhibit 2:2-22 annexed hereto and incorporated herein by reference.     b.   The
remaining Exhibits to the Agreement are true and accurate in all respects and
there have been no changes thereto from the date on which such Exhibits were
delivered to the Agent.

5.   Ratification of Loan Documents. Except as provided herein, all terms and
conditions of the Agreement and the other Loan Documents remain in full force
and effect. The Borrower hereby ratifies, confirms, and reaffirms all
representations, warranties, and covenants contained therein and hereby
represents that no Events of Default exist under the Loan Documents. The
Borrower further ratifies and confirms that any and all Collateral previously
granted to the Agent for the ratable benefit of the Revolving Credit Lenders
continues to secure the existing Liabilities as well as the Liabilities as
amended hereby, and any future Liabilities.

6.   Conditions to Effectiveness. This Sixth Amendment shall be become effective
upon the satisfaction of the following conditions precedent:

  a.   This Sixth Amendment shall have been duly executed and delivered by each
of the Borrower, the Revolving Credit Lenders and the Agent and shall be in full
force and effect.

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  b.   The Borrower shall have delivered to the Agent its Secretary’s
Certificate with certified copies of (i) Incumbency Certificate; (ii) Specimen
Signatures; and (iii) Resolutions.     c.   All proceedings in connection with
the transactions contemplated by this Sixth Amendment and all documents incident
thereto shall be reasonably satisfactory in substance and form to the Agent, and
the Agent shall have received all information and such counterpart originals or
certified or other copies of such documents as the Agent may reasonably request.
Further, the Borrower shall have delivered to the Agent such additional
documents which the Agent may reasonably request, including, without limitation,
an amended and restated Revolving Credit Note in favor of Fleet Retail Group,
LLC and a ratification by each guarantor of their respective guaranties.     d.
  The Agent shall have received the Assignment and Acceptance between The CIT
Group/Business Credit, Inc. and Fleet Retail Group, LLC.     e.   The Borrower
shall have paid all reasonable costs and expenses of the Agent including,
without limitation, all attorneys’ fees and expenses incurred by the Agent in
connection with the Agreement, the Loan Documents, and the preparation,
negotiation and execution of this Sixth Amendment.

7.   Miscellaneous.

  a.   This Sixth Amendment may be executed in several counterparts and by each
party on a separate counterpart, each of which when so executed and delivered
shall be an original, and all of which together shall constitute one instrument.
    b.   This Sixth Amendment expresses the entire understanding of the parties
with respect to the transactions contemplated hereby. No prior negotiations or
discussions shall limit, modify, or otherwise affect the provisions hereof.    
c.   Any determination that any provision of this Sixth Amendment or any
application hereof is invalid, illegal or unenforceable in any respect and in
any instance shall not effect the validity, legality, or enforceability of such
provision in any other instance, or the validity, legality or enforceability of
any other provisions of this Sixth Amendment.     d.   The Borrower shall pay on
demand all costs and expenses of the Agent, including, without limitation,
reasonable attorneys’ fees in connection with the preparation, negotiation,
execution and delivery of this Sixth Amendment.     e.   The Borrower warrants
and represents that the Borrower has consulted with independent legal counsel of
the Borrower’s selection in connection with this Sixth Amendment and is not
relying on any representations or warranties of any

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      Revolving Credit Lender or the Agent or their respective counsel in
entering into this Sixth Amendment.     f.   The Borrower acknowledges and
agrees that the Borrower does not have any claims, counterclaims, offsets, or
defenses against any Revolving Credit Lender or the Agent directly or indirectly
relating to the Borrower’s relationship with, and/or the Borrower’s Liabilities,
and to the extent that the Borrower has or ever had any such claims,
counterclaims, offsets, or defenses against any of the Revolving Credit Lenders
or the Agent, the Borrower affirmatively WAIVES the same. The Borrower, and for
its representatives, successors and assigns, hereby RELEASES, and forever
discharges the Revolving Credit Lenders and the Agent and their respective
officers, directors, agents, servants, attorneys, and employees, and their
respective representatives, successors and assigns, of, to, and from all known
debts, demands, actions, suits, accounts, covenants, contracts, agreements,
damages, and any and all claims, demands, or liabilities whatsoever, of every
name and nature, both at law and in equity through the date hereof.

[remainder of page left intentionally blank]

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     IN WITNESS WHEREOF, the parties have hereunto caused this Sixth Amendment
to be executed and their seals to be hereto affixed as of the date first above
written.

     
 
  HASTINGS ENTERTAINMENT, INC.
(“Borrower”)
 
   
 
  By: [ILLEGIBLE]
 
  Name: DAN CROW
 
  Title: CFO
 
   
 
  FLEET RETAIL GROUP, LLC
(“Agent”)
 
   
 
  By: [ILLEGIBLE]
 
  Name: MARK D. TWONEY
 
  Title: U. P.

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EXHIBIT 2:2-22
REVOLVING CREDIT LENDERS’ COMMITMENTS

                      Revolving Credit     Revolving Credit   Revolving Credit
Lender   Dollar Commitment     Commitment Percentage  
Fleet Retail Group, LLC
    $100,000,000.00       100 %
 
               
Totals
  $ 100,000,000.00       100 %

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February 27, 2007
Fleet Retail Group, LLC, As Agent
40 Broad Street
Boston, Massachusetts 02108
     Re: Amendment to Loan Arrangement with Hastings Entertainment, Inc.
Gentlemen:
     Reference is made to a certain loan arrangement originally dated as of
August 29, 2000 (the “Loan Arrangement”) entered into by and among Hastings
Entertainment, Inc., a Texas corporation (the “Borrower”) and Fleet Retail
Finance Inc., n/k/a Fleet Retail Group, LLC, as Agent (the “Agent”) and The CIT
Group/Business Credit, Inc. (the “Co-Agent”) for a syndicate of Revolving Credit
Lenders, and such Revolving Credit Lenders, pursuant to which such Revolving
Credit Lenders established a revolving line of credit in the Borrower’s favor in
accordance with the terms of a Loan and Security Agreement dated August 29, 2000
(as amended and in effect, the “Loan Agreement”). Unless otherwise defined
herein, all capitalized terms used herein shall have the meaning set forth in
the Loan Agreement.
     The undersigned have each guarantied the Liabilities of the Borrower
pursuant to their respective Guaranties dated August 29, 2000 (singly, a
“Guaranty” and collectively, the “Guaranties”).
     The Borrower, the Agent and the Revolving Credit Lenders desire to modify
and amend the terms of the Loan Agreement pursuant the terms and conditions of a
certain Sixth Amendment to Loan and Security Agreement of even date (the
“Amendment”). The Agent and the Revolving Credit Lenders have indicated that
they will not enter into such Amendment unless, among other things, the
undersigned execute and deliver this letter. Therefore, to induce the Agent and
the Revolving Credit Lenders to enter into the Amendment, the undersigned each
hereby:

  (a)   ratifies, confirms and reaffirms, all and singular, the terms and
conditions of, and all warranties and representations set forth in, their
respective Guaranties.     (b)   acknowledges, confirms and agrees that their
respective Guaranties remain in full force and effect and shall in no way be
limited or affected by the Amendment.     (c)   acknowledges and agrees that
such Person has no offsets, defenses, or counterclaims against the Agent, or any
Revolving Credit Lender with respect to such Person’s Guaranty or otherwise, and
to the extent that any of the undersigned has any such offsets, defenses, or
counterclaims, then such Person hereby WAIVES and RELEASES the same.

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     This letter shall take effect as a sealed instrument as of the date first
written above.

     
 
  Very truly yours,
 
   
 
  HASTINGS COLLEGE STORES, INC.
 
   
Witness:
   
Stephanie Eslep
  By: [ILLEGIBLE]
 
  Name: DAN CROW
 
  Title: CFO
 
   
 
  HASTINGS INTERNET, INC.
 
   
Witness:
   
Stephanie Eslep
  By: [ILLEGIBLE]
 
  Name: DAN CROW
 
  Title: CFO
 
   
Witness:
   
Stephanie Eslep
  HASTINGS PROPERTIES, INC.
 
   
 
  By: [ILLEGIBLE]
 
  Name: DAN CROW
 
  Title: CFO

Acknowledged and Agreed to:
Fleet Retail Group, LLC, as Agent
and Revolving Credit Lender

         
By:
  /s/ Mark D. Tworey    
 
 
 
   
Name:
       
 
 
 
   
Title:
 
 
   
 
 
 
   

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ASSIGNMENT AND ACCEPTANCE
Effective Date: February 27, 2007
     Re: Loan and Security Agreement dated August 29, 2000 (as amended and in
effect, the “Loan Agreement”) between Fleet Retail Group, LLC (f/k/a Fleet
Retail Finance Inc.), as agent for a syndicate of revolving credit lenders (the
“Revolving Credit Lenders” referenced therein and the Revolving Credit Lenders,
on the one hand, and Hastings Entertainment, Inc., on the other (Terms used
herein which are defined in the Loan Agreement have the same meaning herein as
in the Loan Agreement).
     Agreement By and Between:
     THE CIT GROUP/BUSINESS CREDIT, INC. (The “Assignor”) and
     FLEET RETAIL GROUP, LLC (The “Assignee”)

1.   Assignment and Assumption: The Assignor hereby sells and assigns to the
Assignee, and the Assignee hereby purchases and assumes from the Assignor, as of
the Effective Date, 100% of the Assignor’s interest in the Revolving Credit.  
2.   Representations By Assignor: The Assignor represents that the Assignor is
the legal and beneficial owner of the interest being assigned hereby free and
clear of any adverse claims.   3.   Exclusion of Warranties by Assignor: The
Assignor:

  a.   Makes no representation or warranty and assumes no responsibility with
respect to any statements, warranties or representations made in or in
connection with this any Loan Document or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of any Loan Document or any
other instrument or document furnished pursuant hereto.     b.   Makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Borrower or any other Person primarily or secondarily
liable in respect of any of the Liabilities, or the performance or observance by
the Borrower or any other Person primarily or secondarily liable in respect of
any of the Liabilities of any of their obligations under any Loan Documents or
any other instrument or document furnished pursuant hereto or thereto.     c.  
Attaches the Revolving Credit Note of which the Assignor is the holder and
requests that the Agent cause the Borrower’s exchange of such Note for new

 

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      Revolving Credit Notes payable to the Assignor and the Assignee reflecting
the assignment referenced above.

4.   Assignee’s Representations Warranties and Agreements: The Assignee:

  a.   Confirms that it has received a copy of the Loan Agreement (and any
amendment thereto), the most recent financial statements then to have been
delivered pursuant to the Loan Agreement, and such other documents and
information as the Assignee has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment and Acceptance.     b.  
Confirms and represents that, independently and without reliance upon the
Assignor, the Agent, or any other Revolving Credit Lender and based on such
documents and information as the Assignee deems appropriate, has made such
Person’s own credit decision to join in the credit facility contemplated by the
Loan Documents and to become a “Revolving Credit Lender”.     c.   Confirms and
represents that the Assignee will continue to make such Person’s own credit
decisions in taking or not taking action under the Loan Agreement and other Loan
Documents independently and without reliance upon the Assignor, the Agent or any
other Revolving Credit Lender and based on such documents and information as the
Assignee shall deem appropriate at the time.     d.   Appoints and authorizes
the Agent to take such action on behalf of the Assignee and to exercise such
powers under the Loan Documents as are delegated to the Agent by the terms
hereof or thereof, together with such powers as are reasonably incidental
thereto.     e.   Agrees that the Assignee will perform, in accordance with
their terms, all of the obligations which, by the terms of the Loan Agreement
and all other Loan Documents are required to be performed by it as a “Revolving
Credit Lender” as if the Assignee had been a signatory thereto and to any
amendments thereof.     f.   Represents and warrants that it is legally
authorized to enter into this Assignment and Acceptance and to perform its
obligations hereunder, under the Loan Agreement and under the Loan Documents.

5.   Effect of Assignment and Assumption: Following delivery, acceptance and
recording by the Agent of this Assignment and Acceptance, from and after the
Effective Date:

  a.   The Assignee be a party to the Loan Agreement and the other Loan
Documents (and any amendments thereto) and to the extent of the commitment
assigned by this Assignment and Acceptance, have the rights and obligations of a
Revolving Credit Lender thereunder.

 

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  b.   The Assignor shall be released from the Assignor’s obligations under the
Loan Agreement and the other Loan Documents to the extent of the commitment
assigned by this Assignment and Acceptance.     c.   The Agent shall make all
payments in respect of the interest in the Revolving Credit Loans assigned
hereby (including payments of principal, interest, and applicable fees) to the
Assignee.     d.   The Assignor and Assignee shall make all appropriate
adjustments in payments for periods prior to the Effective Date by the Agent or
with respect to the making of this assignment directly between themselves.

6.   Massachusetts Law: This Assignment and Acceptance shall be governed by, and
construed in accordance with, the laws of The Commonwealth of Massachusetts.

 

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     IN WITNESS WHEREOF, intending to be legally bound, each of the undersigned
has caused this Assignment and Acceptance to be executed on its behalf by its
officer thereunto duly authorized, as of the date first above written.

                      ASSIGNOR:    
 
                    THE CIT GROUP/BUSINESS CREDIT, INC.    
 
                    By:   /s/ Adrian Avalos                  
 
      Name:   Adrian Avalos    
 
      Title:   Vice President    
 
                    ASSIGNEE:    
 
                    FLEET RETAIL GROUP, LLC    
 
                    By:   /s/ Mark D. Twoncy                  
 
      Name:   Mark D. Twoncy    
 
      Title:   VP    

 

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      REVOLVING CREDIT NOTE   Fleet Retail Group, LLC     Agent       Boston,
Massachusetts   February 28, 2006 $40,000,000.00   Payee: The CIT Group /
Business Credit, Inc.

     FOR VALUE RECEIVED, the undersigned, Hastings Entertainment, Inc., a Texas
corporation with its principal executive offices at 3601 Plains Boulevard,
Amarillo, Texas 79102 (the “Borrower”) promises to pay to the order of The CIT
Group / Business Credit, Inc., a New York corporation with offices at 5420 LBJ
Freeway (Suite 200), Dallas, Texas 75240 (with any subsequent holder, a
“Revolving Credit Lender”) that amount which the Revolving Credit Lender has
advanced towards the aggregate unpaid principal balance of Revolving Credit
Loans made to or for the account of the Borrower pursuant to the Loan and
Security Agreement dated August 29, 2000 as amended from time to time, including
pursuant to that certain Fifth Amendment to Loan and Security Agreement of even
date herewith (as such may be amended hereafter, the “Loan Agreement”) between
Fleet Retail Group, LLC, f/k/a Fleet Retail Finance Inc., a Delaware limited
liability company with its offices at 40 Broad Street Boston, Massachusetts
02109 (in Such capacity, the “Agent”), as agent for the ratable benefit of the
“Revolving: Credit Lenders”, on the one hand, and the Borrower, on the other,
with interest at the rate and payable in the manner stated therein. Capitalized
terms used but not otherwise defined herein shall have the meanings assigned
thereto in the Loan Agreement.
     This is a “Revolving Credit Note” (this “Note”) to which reference is made
in the Loan Agreement and is subject to all terms and provisions thereof. The
principal of, and interest on, this. Note shall be payable as provided in the
Loan Agreement and shall be subject to Acceleration as provided therein.
     In the absence of manifest error, the Agent’s books and records concerning
Revolving Credit Loans, the accrual of interest thereon, and the repayment of
such Revolving Credit Loans, shall be prima facie evidence of the Indebtedness
hereunder.
     No delay or omission by the Agent or any Revolving Credit Lender in
exercising or enforcing any of the Agent’s or such Revolving Credit Lender’s
powers, rights, privileges, remedies, or discretions hereunder shall operate as
a waiver thereof on that occasion nor on any other occasion. No waiver of any
Event of Default with respect hereto hereunder shall operate as a waiver of any
other Event of Default hereunder, nor as a continuing waiver.

1

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     The Borrower, and each endorser and guarantor of this Note, respectively
waives presentment, demand, notice, and protest, and also waives any delay on
the part of the holder hereof. Each of the Borrower and any endorser or
guarantor hereof assents to any extension or other indulgence (including,
without limitation, the release or substitution of Collateral) permitted by the
Agent with respect to this Note and/or any Collateral given to secure this Note.
     This Note shall be binding upon the Borrower, and each endorser and
guarantor hereof, and upon their respective heirs, successors, assigns, and
representatives, and shall inure to the benefit of the Lender and its
successors, endorsees, and assigns.
     The Liabilities of the Borrower, and of any endorser or guarantor of this
Note, are joint and several, provided, however, the release by the Agent or the
Revolving Credit Lender of any one or more of the Borrower or endorsers or
guarantors shall not release any other Person obligated on account of this Note.
Each reference in this Note to the Borrower, any endorser, and any guarantor, is
to such Person individually and also to all such Persons jointly. No Person
obligated on account of this Note may seek contribution from any other Person
also obligated unless and until all Liabilities to the Revolving Credit Lender
of the Person from whom contribution is sought have been satisfied in full.
     This Note is delivered at the offices of the Agent in Boston, Massachusetts
and shall be governed by the laws of The Commonwealth of Massachusetts, and
shall take effect as a sealed instrument.
     This Revolving Credit Note hereby amends and restates in full that certain
Revolving Credit Note dated August 29, 2000 from Borrower to Revolving Credit
Lender.
     The Borrower makes the following waiver knowingly, voluntarily, and
intentionally, and understands that the Agent and the Revolving Credit Lender in
the establishment and maintenance of their respective relationship with the
Borrower contemplated by this Note, is relying thereon: THE BORROWER, AND EACH
ENDORSER AND GUARANTOR OF THIS NOTE TO THE EXTENT ENTITLED THERETO, RESPECTIVELY
WAIVES ANY PRESENT OR FUTURE RIGHT IT MAY HAVE ON ACCOUNT OF OR IN RESPECT TO
THE LIABILITIES, TO A TRIAL BY JURY IN ANY CASE OR CONTROVERSY IN WHICH THE
AGENT AND/OR ANY REVOLVING CREDIT LENDER IS OR BECOMES A PARTY (WHETHER SUCH
CASE OR CONTROVERSY IS INITIATED BY OR AGAINST THE AGENT AND/OR ANY

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     REVOLVING CREDIT LENDER OR IN WHICH THE AGENT AND/OR ANY REVOLVING CREDIT
LENDER IS JOINED AS A PARTY LITIGANT), THAT ARISES OUT OF, OR IS IN RESPECT TO,
THIS NOTE, THE LOAN AGREEMENT OR ANY OTHER LOAN DOCUMENTS.

             
 
  HASTINGS ENTERTAINMENT, INC.

The (“Borrower”)
   

             
 
  By:   /s/ Daniel Crow    
 
     
 
Daniel Crow    
 
      Senior Vice President    

 

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(LOGO) [d45730d4573002.gif]
  Marjorie B. Crider
mcrider@riemerlaw.com
(617) 880-3423 direct
(617)692-3423 direct fax

March 16, 2007
VIA FEDERAL EXPRESS
Dan Crow
V.P. Finance and Chief Financial Officer
Hastings Entertainment, Inc.
3601 Plains Blvd.
Amarillo, Texas 79102
     Re: Sixth Amendment to Loan and Security Agreement with Fleet Retail Group,
LLC Dear Dan:
     Enclosed herewith please find the following original documents for your
files in connection with the above matter:

  1.   Sixth Amendment to Loan and Security Agreement;     2.   Confirmation of
Guaranty;     3.   Assignment and Acceptance Agreement between The CIT
Group/Business Credit, Inc. and Fleet Retail Group, LLC; and     4.   Revolving
Credit Note dated February 28, 2006 payable to The CIT Group/Business Credit,
Inc. (this Note is no longer in effect and may be destroyed or filed at your
option).

     Please feel free to contact me with any questions regarding the above
materials.

     
 
  Very truly yours,
 
   
 
  -S- Marjorie B. Crider [d45730d4573003.gif]
 
  Marjorie B. Crider

MBC
Enclosures

     
cc:
  Mr. Mark Twomey (via email, w/out enclosures)
Jeff Shrader, Esq. (via email, w/out enclosures)
1001545.1

Riemer & Braunstein LLP
Three Center Plaza · Boston, MA 02108-2003
 

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