Unassociated Document


    FOURTH FORBEARANCE
AGREEMENT

    AND AMENDMENT NO. 1 TO
CREDIT AGREEMENT

    


    FOURTH FORBEARANCE AGREEMENT AND AMENDMENT NO.
1 TO CREDIT AGREEMENT, dated as of May 7, 2009 (this “Agreement”), by and
among Haights Cross Operating Company (the “Borrower”), the
entities listed as “Guarantors” on the signature pages hereto (the “Guarantors”), the
entities listed as “Lenders” on the signature pages hereto (the “Lenders”), and DDJ
Capital Management, LLC, as administrative agent and collateral agent for the
Lenders (the “Agent”).

    


    RECITALS

    


    A.           The
Borrower, the Guarantors, the Lenders and the Agent are parties to that certain
Credit Agreement dated as of August 15, 2008 (as amended, and as the same may be
further amended, modified, supplemented, extended, renewed, restated or
replaced, the “Credit
Agreement”), pursuant to which the Lenders made certain loans to the
Borrower.

    


    B.           The
Borrower has advised the Agent that the Borrowers and the Guarantors (i) are not
able to timely deliver the financial statements and/or other deliverables
required to be delivered to the Agent and Lenders pursuant to Sections 6.1(a)
and 6.1(d) of the Credit Agreement for the fiscal year ended December 31,
2008 and the fiscal quarter ended March 31, 2009 and/or deliver other materials
in compliance with the provisions of Section 6.1(a) of the Credit Agreement for
such periods (the “Specified Financial
Information”), (ii) are not able to timely file with the SEC and/or
timely deliver to certain other Persons, in each case, in accordance with the
Senior Note Documents and the Discount Note Documents, the following reports (x)
report on 10-K required to be filed with the SEC and otherwise delivered for the
Borrower’s fiscal year ended December 31, 2008, (y) any current reports on
8-K required to be filed with the SEC and otherwise delivered after such 10-K is
required to be filed with respect to the Borrower’s fiscal year ended December
31, 2008 and (z) report on 10-Q required to be filed with the SEC and otherwise
delivered for the Borrower’s fiscal quarter ended March 31, 2009 (collectively,
the “Indenture
Financial Reports”), and (iii) believe that they are in compliance with
the financial covenants in Section 7.10 of the Credit Agreements as of the test
dates of September 30, 2008, December 31, 2008 and March 31, 2009 as set
forth in the Compliance Certificates that the Borrower delivered to the Agent in
accordance with the Credit Agreement for such periods (collectively, the “Specified Financial
Covenants”), but understand that the Agent and the Lenders, upon further
review and consideration, may decide that the Borrowers and Guarantors
inappropriately calculated certain of the Specified Financial Covenants, and
have requested that the Agent and the Lenders refrain from declaring a Default
or Event of Default, if any is determined to exist, with respect to the
Specified Financial Covenants solely during the Forbearance Period (any such
Default or Event of Default that may be determined to exist as a result of the
calculation of the Specified Financial Covenants, the “Specified Financial Covenant
Defaults”).

    


    C.           The
failure of the Borrower and the Guarantors to timely deliver the Specified
Financial Information to the Agent and the Lenders pursuant to Section 6.1(a) of
the Credit Agreement constitutes an Event of Default under Section 8.1(c) of the
Credit Agreement (such Event of Default being referred to herein as the “Specified Financial
Information Defaults”), and the failure of the Borrowers and the
Guarantors to timely file and/or deliver the Indenture Financial Reports
constitutes an Event of Default under Section 8.1(f) of the Credit Agreement
(together with the Specified Financial Information Defaults, the “Financial Reporting
Defaults”, and collectively with the Specified Financial Covenant
Defaults, the “Specified Forbearance
Items”).

    


    D.           The
Borrower previously requested that the Agent and the Lenders temporarily forbear
from exercising their rights and remedies solely as a result of the Financial
Reporting Defaults to enable the Borrower and the Guarantors to develop and
present a proposed plan for restructuring certain of the obligations of Borrower
and one or more of the Guarantors, including, the Obligations, and the Agent,
the Lenders, the Borrower and the Guarantors entered into (i) a Forbearance
Agreement dated April 15, 2009 (the “Initial Forbearance
Agreement”), pursuant to which the Agent and the Lenders agreed, subject
to the terms and conditions set forth in the Initial Forbearance Agreement, to
temporarily forbear from exercising their rights and remedies solely as a result
of the Financial Reporting Defaults until April 24, 2009, (ii) a Second
Forbearance Agreement dated April 23, 2009 (the “Second Forbearance
Agreement”), pursuant to which the Agent and the Lenders agreed, subject
to the terms and conditions set forth in the Second Forbearance Agreement, to
temporarily forbear from exercising their rights and remedies solely as a result
of the Financial Reporting Defaults until May 1, 2009 and (iii) a Third
Forbearance Agreement dated May 1, 2009, as amended (the “Third Forbearance
Agreement” and, together with the Initial Forbearance Agreement and the
Second Forbearance Agreement, the “Prior Forbearance
Agreements”) pursuant to which the Agent and the Required Lenders agreed,
subject to the terms and conditions set forth in the Third Forbearance
Agreement, to temporarily forbear from exercising their rights and remedies
solely as a result of the Financial Reporting Defaults until May 7,
2009.

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    E.           The
Borrower has now requested that the Agent and the Lenders continue to
temporarily forbear from exercising their rights and remedies solely as a result
of the Financial Reporting Defaults and the Specified Financial Covenant
Defaults to enable the Borrower and the Guarantors additional time to develop
and present a proposed restructuring plan.

    


    F.           The
Agent and the Lenders are willing to continue to temporarily forbear from
exercising their rights and remedies (other than as expressly set forth in this
Agreement) solely as a result of the Financial Reporting Defaults and the
Specified Financial Covenant Defaults for the period and on the terms and
conditions specified in this Agreement.

    


    G.           In
consideration of the temporary forbearance by the Agent and the Lenders
described in this Agreement, the Credit Parties have agreed with the Agent and
the Lenders to amend the Credit Agreement to, among other things, increase the
rate of interest payable thereunder and modify the dates on which accrued
interest shall be due and payable thereunder, all as more particularly described
in this Agreement.

    


    NOW, THEREFORE, in consideration of the
foregoing, and the respective agreements, warranties and covenants contained
herein, the parties hereto agree, covenant and warrant as follows:

    


    SECTION
1.                                INTERPRETATION;
PRIOR FORBEARANCE AGREEMENTS

    


    1.1           Defined Terms.  All
capitalized terms used herein (including the recitals hereto) shall have the
respective meanings assigned thereto in the Credit Agreement unless otherwise
defined herein.

    


    1.2           Prior Forbearance
Agreements.  Upon the execution and delivery of the Second
Forbearance Agreement, the Second Forbearance Agreement superseded
the Initial Forbearance Agreement and the Initial Forbearance Agreement was
deemed terminated, null and void and upon the execution and delivery of the
Third Forbearance Agreement, the Third Forbearance Agreement superseded the
Second Forbearance Agreement and the Second Forbearance Agreement was
deemed terminated, null and void.  It is the intent of the parties
hereto that upon execution and delivery of this Agreement, this Agreement shall
supersede the Third Forbearance Agreement and the Third Forbearance Agreement
shall be deemed terminated, null and void.

    


    
      
        
        

      

      
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    SECTION
2.                                ACKNOWLEDGEMENTS

    


    2.1           Acknowledgement of
Obligations.  The Borrower hereby acknowledges, confirms and
agrees that as of the close of business on May 6, 2009, the Borrower is indebted
to the Lenders in respect of the Loans in the principal amount of
$108,200,000.  The Borrower and the Guarantors hereby jointly and
severally acknowledge, confirm and agree that the Loans, together with all
interest accrued and accruing thereon, and fees, costs, expenses and other
charges now or hereafter payable by the Borrower to the Agent and the Lenders
pursuant to the terms and provisions of the Loan Documents, are unconditionally
owing by the Borrower, without offset, defense or counterclaim of any kind,
nature or description whatsoever.

    


    2.2           Acknowledgement of Security
Interests.  The Borrower and the Guarantors hereby jointly and
severally acknowledge, confirm and agree that the Agent, for the benefit of the
itself and the Lenders, holds and shall continue to hold valid, enforceable and
perfected first-priority Liens upon and security interests and mortgages, as
applicable, in the Collateral heretofore granted to the Agent pursuant to the
Loan Documents (subject to Permitted Liens).

    


    2.3           Binding Effect of Loan
Documents.  The Borrower and the Guarantors hereby jointly and
severally acknowledge, confirm and agree that:  (a) each of the Loan
Documents to which the Borrower or any Guarantor is a party has been duly
executed and delivered by the Borrower or such Guarantor, as applicable, and
each is in full force and effect as of the date hereof, (b) the agreements
and obligations of the Borrower and the Guarantors contained in the Loan
Documents and in this Agreement constitute the legal, valid and binding
Obligations of the Borrower and the Guarantors, enforceable against the Borrower
and the Guarantors in accordance with their respective terms, and neither the
Borrower nor the Guarantors has any valid defense to the enforcement of such
Obligations, in each case, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other laws affecting creditors’ rights generally
and subject to general principles of equity, regardless of whether considered in
a proceeding in equity or law, and (c) subject to Section 3.2 hereof, the Agent
and the Lenders are and shall be entitled to the rights, remedies and benefits
provided for in the Loan Documents and applicable law.

    


    SECTION
3.                                FORBEARANCE
IN RESPECT OF EVENTS OF DEFAULT

    


    3.1           Acknowledgement of Events of
Default.  The Borrower and the Guarantors hereby jointly and
severally acknowledge and agree that (a) the Financial Reporting Defaults
constitute “Events of Default” under the Credit Agreement, (b) the Specified
Financial Information Default is not subject to cure, and (c) subject to Section
3.2 hereof, the Financial Reporting Defaults entitle the Agent and the Lenders
to exercise their rights and remedies under the Loan Documents and applicable
law.  The Borrower and the Guarantors hereby jointly and severally
further represent and warrant that as of the date hereof no other Defaults or
Events of Default exist under the Loan Documents.  The Borrower and
the Guarantors hereby jointly and severally acknowledge and agree that, subject
to Section 3.2 hereof, the Agent and the Lenders have the present right to
exercise all remedies available under the Loan Documents and applicable
law.

    


    3.2           Forbearance.

    


    (a)           In
reliance upon the representations, warranties and covenants of the Borrower and
the Guarantors contained in this Agreement, and subject to the terms and
conditions of this Agreement and any documents or instruments executed in
connection herewith, the Agent and the Lenders hereby agree to forbear from
exercising, or causing the exercise of, their rights and remedies under the Loan
Documents or applicable law solely in respect of or arising out of the Specified
Forbearance Items (other than the right to charge interest at the then
applicable Post-Default Rate for the period described in the first sentence of
Section 5.5 of this Agreement) for the period (the “Forbearance Period”)
commencing on April 15, 2009 and ending on the earliest to occur of: (i) 6:00
p.m. (Boston, Massachusetts time) on June 5, 2009, (ii) the
occurrence or existence of any Event of Default, other than (x) the Financial
Reporting Defaults and/or (y) the Specified Financial Covenant Defaults or any
breach of the second sentence of Section 3.1 of this Agreement as a result
thereof, and (iii) the occurrence or existence of any “Event of Default”
(including, without limitation, any “Event of Default” arising out of, or
related to, the failure of the Borrower and the Guarantors to timely file and/or
deliver the Indenture Financial Reports) under and as such term is defined in
the Senior Note Indenture and/or the Discount Note Indenture.

    


    
      
        
        

      

      
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    (b)           Upon
the termination of the Forbearance Period, the agreement of the Agent and the
Lenders to forbear from exercising their rights and remedies with respect to the
Financial Reporting Defaults and any Specified Financial Covenant Defaults shall
automatically and without further action terminate and be of no force and
effect, it being expressly agreed that the effect of such termination will be to
permit the Agent and the Lenders to exercise, or cause the exercise of, such
rights and remedies immediately, without any further notice, passage of time or
forbearance of any kind.

    


    3.3           No
Waivers; Reservation of Rights.

    


    (a)           The
Agent and the Lenders have not waived, and are not by the execution of this
Agreement waiving, any Events of Default (including any of the Specified
Forbearance Items) which may be continuing on the date hereof or any Events of
Default which may hereafter occur (whether such Events of Default are the same
as or similar to any of the Specified Forbearance Items or otherwise), and
neither the Agent nor the Lenders have agreed to forbear with respect to any of
their rights or remedies concerning any Events of Default (other than, during
the Forbearance Period, solely with respect to the Specified Forbearance Items
to the extent expressly set forth herein), which may have occurred or are
continuing as of the date hereof or which may occur after the date
hereof.

    


    (b)           Subject
to Section 3.2 above (solely with respect to the Specified Forbearance Items),
the Agent and the Lenders reserve the right, in their discretion, to exercise,
or cause the exercise of, any or all of their rights and remedies under the
Credit Agreement, the other Loan Documents and applicable law as a result of any
Events of Default which may be continuing on the date hereof or any Event of
Default which may hereafter occur.

    


    (c)           Without
limiting the generality of the foregoing, the Borrower and the Guarantors will
not claim that any prior action or course of conduct by the Agent or the
Lenders, including, without limitation the execution and delivery of this
Agreement or any Prior Forbearance Agreement, constitutes an agreement or
obligation to continue such action or course of conduct in the
future.  Each of the Borrower and the Guarantors acknowledges that the
Agent and the Lenders have not made any commitment as to how or whether the
Financial Reporting Defaults will be resolved upon termination or expiration of
the Forbearance Period.

    


    (d)           Except
as set forth in Section 4 of this Agreement, nothing in this Agreement shall be
construed as an amendment to the Credit Agreement or any other Loan
Document.  The Credit Agreement and the other Loan Documents are in
full force and effect, and shall remain in full force and effect unless and
until an agreement modifying the Credit Agreement or another Loan Document is
executed and delivered by the applicable parties, and then only to the extent
such agreement actually modifies such documents.

    


    
      
        
        

      

      
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    3.4           Restructuring Transactions;
Indicative Term Sheet.  The Agent, the Lenders and the Credit
Parties have been discussing the terms of a proposed plan for restructuring
certain of the obligations of the Credit Parties, including the Obligations, and
the Agent has distributed to the Borrower and the Lenders a draft Restructuring
Transaction Term Sheet dated May 7, 2009 (the “Restructuring Term
Sheet”), which Restructuring Term Sheet reflects a summary of the
preliminary indicative terms and conditions that the Agent, the Lenders and the
Credit Parties are considering in connection with the possible restructuring of
certain Indebtedness of the Credit Parties (the “Restructuring
Transactions”).  The parties to this Agreement acknowledge and
agree that the Restructuring Term Sheet is for discussion purposes only and does
not constitute a commitment by the Credit Parties, the Agent or any Lender to
enter into the Restructuring Transactions or to consent or agree to any
restructuring of the Term Loans.  Without limiting the generality of
the foregoing:  (i) the Restructuring Term Sheet does not constitute a
commitment by the Agent or any Lender to make additional Loans or enter into any
other transaction;  and (ii) if the Agent and the Lenders agree, in
their sole discretion, to issue any commitment with respect to the Restructuring
Transactions, the issuance of such commitment shall be subject to the
satisfaction of certain conditions, which conditions shall include, without
limitation:

    


    (a)           receipt
by the Agent and the Lenders of a quality of earnings analysis (the “Quality of Earnings
Report”) prepared by CTS Capital Advisors, or such other advisor
reasonably satisfactory to the Required Lenders (the “Quality of Earnings Report
Preparer”);

    


    (b)           receipt
by the Agent and the Lenders of evidence reasonably satisfactory to the Agent
and the Lenders that (i) the Indenture Financial Reports have been filed with
the SEC and (ii) any defaults under the Senior Note Documents and the Discount
Note Documents arising from the failure by the Credit Parties to file the
Indenture Financial Reports have been cured; and

    


    (c)           receipt
by the Agent and the Lenders of weekly updates (which updates may be made by
telephonic meeting) with respect to the status of the Restructuring
Transactions, including, without limitation, the status of the Credit Parties’
discussions with holders of the Senior Discount Notes.

    


    It is understood
that the foregoing list of conditions and the terms and conditions set forth in
the Restructuring Term Sheet are neither intended to constitute all of the
conditions applicable to any issuance of a commitment with respect to the
Restructuring Transactions, nor intended to constitute all of the terms and
conditions applicable to the Restructuring Transactions.

    


    SECTION
4.                                AMENDMENTS
TO CREDIT AGREEMENT

    


    Effective as of the date of this Agreement, the
Credit Agreement is hereby amended as follows:

    


    4.1           Amendments to Section 1.1 of Credit
Agreement.  Section 1.1 of the Credit Agreement is hereby
amended by (a) deleting the defined term “Applicable Margin”
and replacing such defined term with the following new defined term “Applicable
Margin” and (b) inserting the following new defined term “First Amendment Effective
Date” in the appropriate alphabetical order:

    


    “Applicable Margin”
means (a) for Base Rate Loans, 11.00% per annum and (b) for LIBOR Loans, 12.25%
per annum.

    


    “First Amendment Effective
Date” means May 7, 2009, the effective date of that certain Fourth
Forbearance Agreement and Amendment No. 1 to Credit Agreement, amending this
Agreement.

    


    
      
        
        

      

      
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    4.2           Amendment to Section 2.1(b) of Credit
Agreement.  Section 2.1(b) of the Credit Agreement is hereby
amended and restated in its entirety, as follows:

    


    (b)           Interest on the Term
Loans.

    


    (i)           Subject
to Section 2.2 hereof, the outstanding principal amount of the Term Loans shall
bear interest at a rate per annum equal to either (x) the Adjusted Base Rate
plus the Applicable Margin or (y) the Three Month LIBOR Rate plus the Applicable
Margin, as the Borrower may elect in accordance with Section
2.2(a).  Notwithstanding the foregoing, (i) any portion of the Term
Loans which is not paid when due or within any applicable grace or cure period
shall automatically bear interest until paid in full at the Post-Default Rate,
(ii) during the period when any Event of Default of the type described in
clauses (g), (h) or (i) of Section 8.1 shall have occurred and be
continuing, the outstanding principal balance of the Term Loans shall
automatically bear interest, after as well as before judgment, at the
Post-Default Rate, (iii) if there shall occur and be continuing any Event
of Default (other than an Event of Default of the type described in
clauses (g), (h) or (i) of Section 8.1), following written notice delivered
to the Borrower from the Agent at the request of the Required Lenders, the
outstanding principal balance of the Term Loans shall bear interest, after as
well as before judgment, at the Post-Default Rate during the period beginning on
the date such Event of Default first occurred, and ending on the date such Event
of Default is cured or waived.  Except as otherwise expresssly
permitted under clause (ii) of this Section 2.1(b), accrued interest on the
outstanding principal balance of the Term Loans, whether constituting Base Rate
Loans or LIBOR Loans, shall be payable in cash in arrears on the last Business
Day of each month; provided that interest
accrued at the Post-Default Rate shall be payable on demand, and all accrued
interest on a Term Loan shall be payable on each date that any portion of the
principal of such Term Loan shall be payable hereunder and on the Term Loan
Maturity Date.  All interest hereunder shall be computed on the basis
of a year of 360 days, and in each case shall be payable for the actual number
of days elapsed (including the first day but excluding the last
day).  The applicable Adjusted Base Rate and the Three Month LIBOR
Rate shall be determined by the Agent, and such determination shall be
conclusive absent manifest error.

    


    (ii)           Notwithstanding
anything to the contrary set forth herein, at any time after the First Amendment
Effective Date until the occurrence of any Event of Default (other than the
Financial Reporting Defaults and any Specified Financial Covenant Defaults (as
such terms are defined in the Fourth Forbearance Agreement and Amendment No. 1
to Credit Agreement, dated as of May 7, 2009)), in lieu of making cash payments
for the entire amount of interest accrued and owing on the last Business Day of
any month in respect of the outstanding Term Loans, the Borrower may make an
election (a “PIK
Election”) to cause a portion not in excess of 2.00% per annum of the
accrued interest required to be paid in respect of the Term Loans as of the last
Business Day of such month to be “paid-in-kind” (a “PIK Payment”), provided, that in no
event shall the Borrower make a PIK Election with respect to accrued interest in
respect of the Term Loans in excess of 2.00% per annum.  In the event
the Borrower makes any PIK Election, the PIK Payment applicable to such PIK
Election shall be added to the outstanding principal amount of the Term Loans on
the first Quarterly Date to occur after the date of such PIK Election, and,
thereafter, the outstanding principal amount of the Term Loans, as increased by
the amount of all PIK Payments added to the principal amount of the Term Loans
on or prior to such Quarterly Date, shall continue to bear interest from and
after such Quarterly Date as provided in this Section 2.1(b) until the entire
principal amount of the Term Loans shall have been paid in
full.  Unless the context otherwise requires, for all purposes of this
Agreement and the other Loan Documents, references to the “principal amount” of
the Term Loans shall be deemed, as of any date of determination, to refer to the
outstanding principal amount of the Term Loans after giving effect to the
addition of all PIK Payments through such date of determination.  If
the Borrower desires to make a PIK Election, the Borrower shall provide the
Administrative Agent with notice, in writing, not less than three (3) Business
Days prior to the last Business Day of the applicable month for which the
Borrower desires to make a PIK Payment, which notice shall specify the amount of
the PIK Payment that will be added to the principal amount of the Term Loans on
the next Quarterly Date and the amount of the accrued interest in respect of the
Term Loans that the Borrower shall pay in cash on the last Business Day of the
month in which such PIK Election is made. Notwithstanding anything to the
contrary set forth in this Section 2.1(b)(ii), if, during the Forbearance Period
(as defined in the Fourth Forbearance Agreement and Amendment No. 1 to Credit
Agreement, dated as of May 7, 2009), the Borrower makes any PIK Election, the
PIK Payment applicable to such PIK Election shall be added to the outstanding
principal amount of the Term Loans on the last Business Day of the month in
which such PIK Election is made, and the outstanding principal amount of the
Term Loans after giving effect to such PIK Payment shall continue to bear
interest from and after such Business Day as provided in this Section 2.1(b)
until the entire principal amount of the Term Loans shall have been paid in
full.

    


    
      
        
        

      

      
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    SECTION
5.                                REPRESENTATIONS,
WARRANTIES AND COVENANTS

    


    The Borrower and the Guarantors hereby
represent, warrant and covenant with and to the Agent and each Lender as
follows:

    


    5.1           Representations in Loan
Documents.  Each of the representations and warranties made by
or on behalf of the Borrower or the Guarantors to the Agent and the Lenders in
any of the Loan Documents was true and correct when made.  Except as
otherwise described in the updated disclosure Schedules attached to this
Agreement (the “Updated Disclosure
Schedules”) and except (a) that the references to specific financial
statements in Sections 4.4(a) and 4.4(c) of the Credit Agreement shall be deemed
to refer to the financial statements listed in part (a) of Updated Disclosure
Schedule 4.4 attached to this Agreement, (b) in lieu of making the
representation and warranty set forth in Section 4.4(b) of the Credit Agreement,
the Credit Parties represent and warrant to the Agent and the Lenders that
except as disclosed in part (b) of Updated Disclosure Schedule 4.4 attached to
this Agreement, since December 31, 2008 there has been no material adverse
change in the business, assets, operations or condition, financial or otherwise,
or prospects of Holdings and its Subsidiaries from that set forth in the
consolidated balance sheets and statement of operations, shareholders’ equity
and cash flows of Holdings and its Subsidiaries as of and for the fiscal year
ended December 31, 2008, (c) that the representations and warranties of the
Credit Parties set forth in Section 4.11 of the Credit Agreement are qualified
by the disclosure items set forth on Updated Disclosure Schedule 4.11 attached
to this Agreement, and (d) that the representations and warranties set forth in
Section 4.16 of the Credit Agreement are not being updated or made by the Credit
Parties in connection with this Agreement, each of the representations and
warranties made by or on behalf of the Borrower or the Guarantors to the Agent
and the Lender in each of the Loan Documents is true and correct in all material
respects as of the date of this Agreement with the same full force and effect as
if each such representation and warranty had been made by the Borrower or the
Guarantors, as appropriate, in this Agreement on the date hereof, provided that
(i) any representation or warranty that is qualified as to “materiality” or
“Material Adverse Effect” shall be true and correct in all respects, subject to
the materiality qualification contained therein, and (ii) any representation or
warranty made by the Credit Parties in any Loan Agreement regarding the absence
of any Defaults shall not be deemed to be false or inaccurate solely with
respect to the Specified Forbearance Items.

    


    
      
        
        

      

      
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    5.2           Binding Effect of
Documents.  This Agreement and the other Loan Documents have
been duly executed by the Borrower and the Guarantors, as applicable, and
delivered to the Agent and the Lenders and are in full force and effect, subject
to the terms and conditions of this Agreement.

    


    5.3           No Conflict,
Etc.  The execution and delivery and performance of this
Agreement by the Borrower and the Guarantors do not and will not violate any
requirement of law or contractual obligation of the Borrower or the Guarantors,
and do not and will not result in, or require, the creation or imposition of any
Lien on any of their respective properties or revenues.

    


    5.4           Additional Events of
Default.  The parties hereto acknowledge, confirm and agree
that any misrepresentation by the Borrower or the Guarantors, or any failure of
the Borrower or the Guarantors to comply with the covenants, conditions and
agreements contained in this Agreement shall constitute an Event of Default
under the Credit Agreement and the other Loan Documents.

    


    5.5           Interest.  In
accordance with the terms of the Initial Forbearance Agreement, the Second
Forbearance Agreement and the Third Forbearance Agreement, the Term Loans
accrued interest from April 15, 2009 through and including May 6, 2009 at the
then applicable Post-Default Rate (determined without giving effect to the
amendment to the definition of the “Applicable Margin” made pursuant to this
Agreement).  From and after the First Amendment Effective Date, the
Term Loans shall cease to accrue interest at the Post-Default Rate and shall
accrue interest in accordance with the terms of Section 2.1(b) of the Credit
Agreement (as amended by this Agreement).  Notwithstanding anything to
the contrary set forth in any Loan Document, the Agent and the Lenders agree
that they shall not elect to charge interest at the Post-Default Rate at any
time during the period from the First Amendment Effective Date through the later
to occur of (a) June 6, 2009 and (b) the termination of the Forbearance Period
(as now defined in Section 3.2(a) of this Agreement or as the same may be
hereafter extended by written agreement of the Agent and the Required Lenders);
provided that nothing herein shall limit the right of the Agent and the Lenders
following the later to occur of (x) June 6, 2009 and (y) the termination of the
Forbearance Period (as now defined in Section 3.2(a) of this Agreement or as the
same may be hereafter extended by written agreement of the Agent and the
Required Lenders) to charge interest at the Post-Default Rate in accordance with
the terms of Section 2.1(b) of the Credit Agreement (as amended by this
Agreement) upon written notice to the Borrower in accordance with Section 2.1(b)
of the Credit Agreement.

    


    5.6           Quality of Earnings
Report.  The Credit Parties shall fully cooperate with the
Quality of Earnings Report Preparer, shall provide the Quality of Earnings
Report Preparer with such information as the Quality of Earnings Report Preparer
shall reasonably request from time to time, and shall make available, at
reasonable times and upon reasonable prior notice give to the President and
Chief Executive Officer of the Borrower, to the Quality of Earnings Report
Preparer any and all management personnel reasonably requested from time to time
by the Quality of Earnings Report Preparer, in each case, in connection with the
preparation of the Quality of Earnings Report.  The Agent and Lenders
shall direct the Quality of Earnings Report Preparer to provide the Borrower
with a copy of the Quality of Earnings Report after such report has been
reviewed by the Agent and the Lenders.  Failure of the Credit Parties
to comply with this Section 5.6 shall constitute an Event of Default, if such
failure remains unremedied for a period of two (2) Business Days following
notice of such failure given by the Agent to the Borrower.

    


    5.7            Minimum Unrestricted
Cash.  The Credit Parties covenant and agree that the Credit
Parties shall at all times during the Forbearance Period maintain an aggregate
amount of cash in deposit accounts and securities accounts, in each case,
subject to Control Agreements, equal to or in excess of
$30,000,000.

    


    
      
        
        

      

      
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    SECTION
6.                                PROVISIONS
OF GENERAL APPLICATION

    


    6.1           Effectiveness of this
Agreement.  The effectiveness of this Agreement shall be
conditioned upon the satisfaction of the following conditions
precedent:

    


    (a)           the
Agent shall have received counterpart signature pages to this Agreement duly
executed and delivered by the Borrower, each Guarantor and each
Lender;

    


    (b)           the
Agent shall have received a copy of the presentation to the Borrower’s board of
directors prepared by Tim Bernlohr, managing member of TJB Management
Consultant, LLC, regarding certain potential cost savings;

    


    (c)           the
Agent shall have received an electronic copy (in the form of an Excel
spreadsheet) of the most recent financial model prepared by the Credit Parties;
and

    


    (d)           the
Agent shall have received a copy of the presentation made by the Borrower to
Ernst & Young LLP; and

    


    (e)           the
Credit Parties shall have paid all fees, charges and disbursements of counsel
for the Agent and counsel for any Lender, in each case, for which an invoice has
been delivered to the Borrower prior to the date hereof.

    


    6.2           Effect of this
Agreement.  Except as modified hereby during the Forbearance
Period and, except as set forth in Section 4 of this Agreement, no other changes
or modifications to the Credit Agreement or the other Loan Documents are
intended or implied and in all other respects the Credit Agreement and the other
Loan Documents are hereby specifically ratified, restated and confirmed by all
parties hereto as of the effective date hereof.  To the extent of
conflict between the terms of this Agreement and the terms of the Credit
Agreement and the other Loan Documents, the terms of this Agreement shall
control.

    


    6.3           Costs and
Expenses.  The Borrower and the Guarantors jointly and
severally, absolutely and unconditionally, agree to pay to the Agent, on demand
by the Agent at any time and as often as the occasion may require, whether or
not all or any of the transactions contemplated by this Agreement are
consummated, all reasonable and documented out-of-pocket expenses incurred by
the Agent, any Lender or any of their respective Affiliates, including all fees
and expenses of the Quality of Earnings Report Preparer in connection with the
Quality of Earnings Report and including the reasonable and documented fees,
charges and disbursements of any counsel for the Agent, any Lender or any of
their respective Affiliates, as a consequence of or in any way in connection
with the preparation, negotiation, execution, or delivery of this Agreement and
the enforcement, attempted enforcement or preservation of any rights or remedies
under this Agreement and any agreements prepared, negotiated, executed or
delivered in connection with the transactions contemplated
hereby.  The foregoing fees, costs and expenses shall be in addition
to (but without duplication of) all fees, costs, disbursements and expenses
payable by the Borrower and the Guarantors pursuant to the terms of the Credit
Agreement.

    


    6.4           Indemnification. The
Borrower and the Guarantors jointly and severally agree to indemnify and hold
the Agent and the Lenders and each of their respective directors, officers,
employees, agents (each, an “Indemnified Person”)
harmless from and against any and all claims, losses, damages, obligations,
liabilities, penalties, reasonable costs and expenses (including, without
limitation, reasonable attorneys' fees and expenses) of any kind or nature
whatsoever, whether direct, indirect or consequential (collectively, “Indemnified Costs”),
that may at any time be imposed on, incurred by or asserted against any such
Indemnified Person as a result of, arising from or in any way relating to the
preparation, execution, performance or enforcement of this Agreement, any
agreements prepared, negotiated, executed or delivered in connection with the
transactions contemplated hereby or any action, suit or proceeding (including
any inquiry or investigation) by any Person, whether threatened or initiated,
related to any of the foregoing, and in any case whether or not such Indemnified
Person is a party to any such action, proceeding or suit or a subject of any
such inquiry or investigation and whether based on
contract, tort or any other theory; provided that such indemnity shall not, as
to any Indemnified Person, be available to the extent that such Indemnified
Costs are determined by a court of competent jurisdiction by final and
nonappealable judgment to have resulted from the gross negligence or willful
misconduct of such Indemnified Person.  All of the foregoing
Indemnified Costs of any Indemnified Person shall be paid or reimbursed by the
Borrower and the Guarantors, as and when incurred and upon demand.

    


    
      
        
        

      

      
        - 9 -

        
          

        

      

      
        
        

      

    

    6.5           Further
Assurances.  The Borrower and the Guarantors shall execute and
deliver such additional documents and take such additional actions as may be
necessary or desirable to effectuate the provisions and purposes of this
Agreement.

    


    6.6           Survival of Representations and
Warranties.  All representations and warranties made in this
Agreement or any other document furnished in connection with this Agreement
shall survive the execution and delivery of this Agreement and the other
documents, and no investigation by the Agent or the Lenders or any closing of
any transaction shall affect the representations and warranties or the right of
Agent or the Lenders to rely upon them.

    


    6.7           Release.

    


    (a)           In
consideration of the agreements of the Agent and the Lenders contained herein
and for other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the Borrower, on behalf of itself and its
successors, assigns, and other legal representatives and each Guarantor, on
behalf of itself and its successors, assigns, and other legal representatives,
hereby absolutely, unconditionally and irrevocably release, remise and forever
discharge the Agent, each Lender and their respective successors and assigns,
and their affiliates, subsidiaries, predecessors, directors, officers,
attorneys, employees, agents and other representatives (the Agent, each Lender
and all such other Persons being hereinafter referred to collectively as the
“Releasees”,
and individually as a “Releasee”), of and
from all demands, actions, causes of action, suits, controversies, sums of
money, accounts, bills, reckonings, damages and any and all other claims,
counterclaims, defenses, rights of set-off, demands and liabilities whatsoever
(individually, a “Claim”, and
collectively, “Claims”) of every
name and nature, known or unknown, suspected or unsuspected, both at law and in
equity, which Borrower or any of its successors, assigns, or other legal
representatives or any Guarantor, or any of her, his or its respective heirs,
administrators, successors, assigns, and other legal representatives, may now or
hereafter own, hold, have or claim to have against the Releasees or any of them
for, upon, or by reason of any circumstance, action, cause or thing whatsoever
which arises at any time on or prior to the day and date of this Agreement for
or on account of, or in relation to, or in any way in connection with any of the
Credit Agreement, the other Loan Documents or this Agreement or transactions
thereunder or related thereto.

    


    (b)           The
Borrower and the Guarantors understand, acknowledge and agree that the release
set forth above may be pleaded as a full and complete defense and may be used as
a basis for an injunction against any action, suit or other proceeding which may
be instituted, prosecuted or attempted in breach of the provisions of such
release.

    


    
      
        
        

      

      
        - 10 -

        
          

        

      

      
        
        

      

    

    (c)           The
Borrower and the Guarantors agree that no fact, event, circumstance, evidence or
transaction which could now be asserted or which may hereafter be discovered
shall affect in any manner the final, absolute and unconditional nature of the
release set forth above.

    


    6.8           Covenant Not to
Sue.  The Borrower, on behalf of itself and its successors,
assigns, and other legal representatives, and each Guarantor, on behalf of
itself and its successors, assigns, and other legal representatives, hereby
absolutely, unconditionally and irrevocably, covenant and agree with and in
favor of each Releasee that the Borrower and such Guarantor will not sue (at
law, in equity, in any regulatory proceeding or otherwise) any Releasee on the
basis of any Claim released, remised and discharged by the Borrower or the
Guarantors pursuant to Section 6.7 above.  If the Borrower or any of
its successors, assigns or other legal representatives or any Guarantor, or its
successors, assigns or other legal representatives, violates the foregoing
covenant, the Borrower, for itself and its successors, assigns and legal
representatives, and each Guarantor, for itself and its successors, assigns and
legal representatives, agrees to pay, in addition to such other damages as any
Releasee may sustain as a result of such violation, all attorneys' fees and
costs incurred by any Releasee as a result of such violation.

    


    6.9           Reaffirmation of
Guaranties.  Each Guarantor absolutely, unconditionally and
irrevocably reaffirms and ratifies its respective obligations under the Credit
Agreement and each other Loan Document to which such Guarantor is a party,
consents to the execution and delivery of this Agreement, and agrees and
acknowledges that its liability as a Guarantor shall not be affected in any way
by the execution and delivery of this Agreement or by the consummation of any of
the transactions contemplated herein.  Each Guarantor warrants and
represents that it has no defenses, setoffs, claims, counterclaims or causes of
action of any kind or nature whatsoever with respect to the Credit Agreement,
the other Loan Documents or this Agreement.

    


    6.10           Severability.  Any
provision of this Agreement held by a court of competent jurisdiction to be
invalid or unenforceable shall not impair or invalidate the remainder of this
Agreement.

    


    6.11           Reviewed by
Attorneys.  The Borrower and the Guarantors represent and
warrant to the Agent and Lenders that they (a) understand fully the terms of
this Agreement and the consequences of the execution and delivery of this
Agreement, (b) have been afforded an opportunity to have this Agreement reviewed
by, and to discuss this Agreement with, such attorneys and other persons as the
Borrower and the Guarantors may wish, and (c) have entered into this Agreement
of their own free will and accord and without threat, duress or other coercion
of any kind by any Person.  The parties hereto acknowledge and agree
that neither this Agreement nor the other documents executed pursuant hereto
shall be construed more favorably in favor of one than the other based upon
which party drafted the same, it being acknowledged that all parties hereto
contributed substantially to the negotiation and preparation of this Agreement
and the other documents executed pursuant hereto or in connection
herewith.

    


    6.12           Governing Law; Submission to
Jurisdiction.  THIS AGREEMENT AND THE OBLIGATIONS ARISING
HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH,
THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS APPLICABLE TO CONTRACTS MADE AND
PERFORMED IN SUCH JURISDICTION, WITHOUT REGARD TO THE PRINCIPLES THEREOF
REGARDING CONFLICTS OF LAWS, AND ANY APPLICABLE LAWS OF THE UNITED STATES OF
AMERICA.  THE BORROWER AND EACH GUARANTOR EXECUTING THIS AGREEMENT
HEREBY CONSENT AND AGREE THAT THE STATE OR FEDERAL COURTS LOCATED IN BOSTON,
MASSACHUSETTS SHALL HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS
OR DISPUTES BETWEEN THE BORROWER AND THE GUARANTORS, ON THE ONE HAND, AND THE
AGENT AND THE LENDERS, ON THE OTHER HAND, PERTAINING TO THIS AGREEMENT, THE
CREDIT AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR TO ANY MATTER ARISING OUT
OF OR RELATED TO THIS AGREEMENT, THE CREDIT AGREEMENT OR ANY OF THE OTHER LOAN
DOCUMENTS; PROVIDED, THAT THE
AGENT, THE LENDER, THE BORROWER AND THE GUARANTORS ACKNOWLEDGE THAT ANY APPEALS
FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE OF BOSTON,
MASSACHUSETTS; AND FURTHER PROVIDED, THAT
NOTHING IN THIS AGREEMENT SHALL BE DEEMED OR OPERATE TO PRECLUDE THE AGENT OR
THE LENDERS FROM BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER
JURISDICTION HAVING JURISDICTION OVER THE BORROWER, ANY GUARANTOR OR THE
COLLATERAL TO COLLECT THE OBLIGATIONS, TO REALIZE ON THE COLLATERAL OR ANY OTHER
SECURITY FOR THE OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN
FAVOR OF THE AGENT OR THE LENDERS.  THE BORROWER AND THE GUARANTORS BY
EXECUTING THIS AGREEMENT EXPRESSLY SUBMIT AND CONSENT IN ADVANCE TO SUCH
JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND THE BORROWER
AND THE GUARANTORS HEREBY WAIVE ANY OBJECTION WHICH THEY MAY HAVE BASED UPON
LACK OF PERSONAL JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS.  THE
BORROWER AND THE GUARANTORS BY EXECUTING THIS AGREEMENT HEREBY WAIVE PERSONAL
SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH ACTION OR
SUIT AND AGREE THAT SERVICE OF SUCH SUMMONS, COMPLAINTS AND OTHER PROCESS MAY BE
MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO THE BORROWER OR ANY GUARANTOR
AT THE ADDRESSES SET FORTH IN THE CREDIT AGREEMENT AND THAT SERVICE SO MADE
SHALL BE DEEMED COMPLETED UPON THE EARLIER OF BORROWER'S OR SUCH GUARANTOR'S
ACTUAL RECEIPT THEREOF OR THREE (3) DAYS AFTER DEPOSIT IN THE U.S. MAILS, PROPER
POSTAGE PREPAID.

    


    
      
        
        

      

      
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    6.13           Waiver of Jury
Trial.  THE PARTIES DESIRE THAT THEIR DISPUTES BE RESOLVED BY A
JUDGE APPLYING SUCH APPLICABLE LAWS.  THEREFORE, TO ACHIEVE THE BEST
COMBINATION OF THE BENEFITS OF THE JUDICIAL SYSTEM AND OF ARBITRATION, TO THE
EXTENT PERMITTED BY LAW, THE PARTIES HERETO WAIVE ALL RIGHTS TO TRIAL BY JURY IN
ANY ACTION, SUIT, OR PROCEEDING BROUGHT TO RESOLVE ANY DISPUTE, WHETHER ARISING
IN CONTRACT, TORT, OR OTHERWISE BETWEEN THE AGENT AND THE LENDERS, ON THE ONE
HAND, AND THE BORROWER AND THE GUARANTORS, ON THE OTHER HAND, ARISING OUT OF,
CONNECTED WITH, RELATED OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN
THEM IN CONNECTION WITH THIS AGREEMENT, THE CREDIT AGREEMENT OR ANY OF THE OTHER
LOAN DOCUMENTS OR THE TRANSACTIONS RELATED THERETO.

    


    6.14           Counterparts.  This
Agreement may be executed in any number of counterparts, but all of such
counterparts shall together constitute but one and the same
agreement.  Delivery of an executed counterpart of a signature page of
this Agreement by telecopy or electronic mail shall be effective as delivery of
a manually executed counterpart of this Agreement.

    


    6.15           Notices.  All
notices required to be made under this Agreement, the Credit Agreement or the
other Loan Documents to the Borrower or any Guarantor shall be made in the
manner and to the addresses noted in Section 10.1 of the Credit
Agreement.  All notices required to be made under this Agreement or
the other Loan Documents to the Agent and the Lenders shall be made in the
manner noted in Section 10.1 of the Credit Agreement. The refusal of any party
to accept delivery or the inability to deliver because of changed address of
which no notice was given shall be deemed the equivalent of
receipt.

    


    
      
        
        

      

      
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    6.16           Successors and
Assigns.  This Agreement shall be binding on and inure to the
benefit of the parties and their heirs, beneficiaries, successors and
assigns.

    


    6.17           Amendments.  No
change, addition to, amendment or modification of the terms of this Agreement
shall be effective unless such amendment or modification is consummated in
accordance with the terms of the Credit Agreement.

    


    6.18           Entire
Agreement.  This Agreement is the entire agreement, and
supersedes any prior agreements and contemporaneous oral agreements, of the
parties concerning its subject matter.

    


    


    [SIGNATURE PAGE
FOLLOWS]

    


    
      
        
        

      

      
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    IN
WITNESS WHEREOF, this Agreement is executed and delivered as of the day and year
first above written.

     

    BORROWER

    


    Haights
Cross Operating Company

    


    


    By: /s/ Paul J.
Crecca

    Name: Paul J.
Crecca

    Title: President
and Chief Executive Officer

    


    GUARANTORS

    


    Haights
Cross Communications, Inc.

    


    


    By: /s/ Paul J.
Crecca

    Name: Paul J.
Crecca

    Title: President
and Chief Executive Officer

    


    


    Sundance/NewBridge


    Educational
Publishing, LLC

    


    


    By: /s/ Paul J.
Crecca

    Name: Paul J.
Crecca

    Title:
Chairman

    


    


    Triumph
Learning, LLC

    


    


    By: /s/ Paul J.
Crecca

    Name: Paul J.
Crecca

    Title:
Chairman

     

    


    Recorded
Books, LLC

    


    


    By: /s/ Paul J.
Crecca

    Name: Paul J.
Crecca

    Title:
Chairman

    


    


    WF
Howes Limited

    


    


    By: /s/ Paul J.
Crecca

    Name: Paul J.
Crecca

    Title:
Chairman

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    AGENT

    


    DDJ Capital Management,
LLC,

    as
Administrative Agent 

    and Collateral
Agent

    


    


    By: /s/ Anthony M.
Ranaldi_______

    Name: Anthony M.
Ranaldi

    Title:  Authorized
Signatory

    


    By: /s/ Joshua L.
McCarthy_______

    Name: Joshua L.
McCarthy

    Title:  Authorized
Signatory

    


    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


    LENDERS

    


    Crystal
Capital Onshore 

    Warehouse
LLC

    


    As
duly authorized: Crystal Capital Fund Management, L.P. as designated
manager

    


    By: Crystal Capital
Fund Management GP, LLC, its General Partner

    


    


    By:_/s/ Steven A. Migliero,
Jr.__________

    Name: Steven A.
Migliero, Jr.

    Title: Managing
Director

    


    


    Crystal
Capital Fund, L.P.

    


    By: Crystal Capital
GP, LLC, 

    its General
Partner

    


    


    By:_/s/ Steven A. Migliero,
Jr.__________

    Name: Steven A.
Migliero, Jr.

    Title: Managing
Director

    


    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


    LENDERS

    


    Regiment Capital Special


    Situations Fund IV, L.P.
(“Fund”)

    


    By:   Regiment
Capital IV GP, L.P.

     (“GPLP”),
the
Fund’s General Partner

    


    By:  Regiment
Capital IV GP, LLC,

    General Partner of
GPLP

    


    


    By:_/s/ Richard T.
Miller__________

    Name: Richard T.
Miller

    Title: Authorized
Signatory

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    LENDERS

    


    GMAM
Investment Funds Trust II,

    for
the account
of the 

    Promark
Alternative High

    Yield
Bond Fund (Account No. 7M2E)

    


    By:  DDJ
Capital Management, LLC, 

    on
behalf of GMAM Investment


    Funds Trust II, for
the

    account of the


    Promark Alternative
High Yield

    Bond Fund, in its
capacity as 

    investment
manager

    


    


    By: /s/ Anthony M.
Ranaldi_______

    Name: Anthony M.
Ranaldi

    Title:  Authorized
Signatory

    


    By: /s/ Joshua L.
McCarthy_______

    Name: Joshua L.
McCarthy

    Title:  Authorized
Signatory

    


    


    GMAM
Investment Funds Trust

    


    By: DDJ Capital
Management, LLC,

    on
behalf of 

    GMAM Investment
Funds Trust,

    in
its capacity as investment manager

    


    


    By: /s/ Anthony M.
Ranaldi_______

    Name: Anthony M.
Ranaldi

    Title:  Authorized
Signatory

    


    By: /s/ Joshua L.
McCarthy_______

    Name: Joshua L.
McCarthy

    Title:  Authorized
Signatory

    


    


    DDJ
Capital Management Group Trust

    


    By:  DDJ
Capital Management, LLC, 

    as
attorney-in-fact

    


    


    By: /s/ Anthony M.
Ranaldi_______

    Name: Anthony M.
Ranaldi

    Title:  Authorized
Signatory

    


    By: /s/ Joshua L.
McCarthy_______

    Name: Joshua L.
McCarthy

    Title:  Authorized
Signatory

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


    LENDERS

    


    Stichting
Pensioenfonds Hoogovens

    


    


    By:  DDJ
Capital Management, LLC, 

    on
behalf
of Stichting
Pensioenfonds Hoogovens,

    in
its capacity as Manager

    


    


    By: /s/ Anthony M.
Ranaldi_______

    Name: Anthony M.
Ranaldi

    Title:  Authorized
Signatory

    


    By: /s/ Joshua L.
McCarthy_______

    Name: Joshua L.
McCarthy

    Title:  Authorized
Signatory

    


    


    DDJ
High Yield Fund

    


    By:   
DDJ Capital Management, LLC,

    its
attorney-in-fact

    


    


    By: /s/ Anthony M.
Ranaldi_______

    Name: Anthony M.
Ranaldi

    Title:  Authorized
Signatory

    


    By: /s/ Joshua L.
McCarthy_______

    Name: Joshua L.
McCarthy

    Title:  Authorized
Signatory

    


    


    Caterpillar
Inc. Master 

    Retirement
Trust

    


    By:  DDJ
Capital Management, LLC,

    on
behalfof Caterpillar Inc.


    Master Retirement
Trust, in

    its capacity as
investment manager

    


    


    By: /s/ Anthony M.
Ranaldi_______

    Name: Anthony M.
Ranaldi

    Title:  Authorized
Signatory

    


    By: /s/ Joshua L.
McCarthy_______

    Name: Joshua L.
McCarthy

    Title:  Authorized
Signatory

    


    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    LENDERS

    


    J.C.
Penney Corporation, Inc. Pension Plan Trust

    


    By:  DDJ
Capital Management, LLC,

    on
behalf of J.C. Penney
Corporation, Inc.

    Pension Plan
Trust,
in its capacity 

    as
investment manager

    


    


    By: /s/ Anthony M.
Ranaldi_______

    Name: Anthony M.
Ranaldi

    Title:  Authorized
Signatory

    


    By: /s/ Joshua L.
McCarthy_______

    Name: Joshua L.
McCarthy

    Title:  Authorized
Signatory

    


    


    Stichting
Bewaarder Interpolis Pensioenen Global High Yield Pool

    


    By:  Syntrus
Achmea Asset Management,

     as asset
manager

    


    By:  DDJ
Capital Management, LLC,

     as
subadviser

    


    


    By: /s/ Anthony M.
Ranaldi_______

    Name: Anthony M.
Ranaldi

    Title:  Authorized
Signatory

    


    By: /s/ Joshua L.
McCarthy_______

    Name: Joshua L.
McCarthy

    Title:  Authorized
Signatory

    


    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Stichting
Pensioenfonds 

    Metaal
en Techniek

    


    By:  DDJ
Capital Management, LLC, 

    in
its capacity as Manager

    


    


    By: /s/ Anthony M.
Ranaldi_______

    Name: Anthony M.
Ranaldi

    Title:  Authorized
Signatory

    


    By: /s/ Joshua L.
McCarthy_______

    Name: Joshua L.
McCarthy

    Title:  Authorized
Signatory

    


    LENDERS

    


    DDJ
Total Return Loan Fund, L.P.

    


    By:  GP
Total Return, LP, 

    its General
Partner

    By:  GP
Total Return, LLC, 

    its General
Partner

    By:  DDJ
Capital Management, LLC,

    Manager

    


    


    By: /s/ Anthony M.
Ranaldi_______

    Name: Anthony M.
Ranaldi

    Title:  Authorized
Signatory

    


    By: /s/ Joshua L.
McCarthy_______

    Name: Joshua L.
McCarthy

    Title:  Authorized
Signatory

    


    


    General
Motors Welfare 

    Benefit
Trust (VEBA)

    


    State Street Bank
and Trust Company, solely in its capacity as Trustee for General Motors Welfare
Benefit Trust (VEBA) as directed by DDJ Capital Management, LLC, and not in its
individual capacity

    


    


    By:  _/s/ Aaron J.
Poulin__________

    Name: Aaron J.
Poulin

    Title:  Vice
President