(c) Supplementing the Fiscal Quarter end test periods and Tangible Net Worthrequirements set forth in sub-clause (a) of Paragraph 7.10 of Section 7 of the Financing Agreement,an additional test period and Tangible Net Worth requirement is also to be included in suchsub-clause, by adding the following provision immediately at the end of such sub-clause: “Withoutlimiting the foregoing, the Company shall also maintain as of its financial statement date ofFebruary 28, 2009, a Tangible Net Worth of not less than $4,667,000 (the “Month End February, 2009Tangible Net Worth Covenant”). In this regard, the Company will furnish to the Agent and eachLender a consolidated financial statements, by no later than April 10, 2009, certified by anauthorized financial or accounting officer of the Borrowing Agent, accompanied by an officer’scompliance certificate, signed by the President, Vice President, Controller, Chief FinancialOfficer or Treasurer, pursuant to which any one such officer must certify whether or not thecalculations based upon the above referenced financial statements demonstrate compliance with theMonth End February, 2009 Tangible Net Worth Covenant.”          (d) Supplementing the Fiscal Quarter end test periods and minimum EBITDArequirements set forth in sub-clause (b) of Paragraph 7.10 of Section 7 of the Financing Agreement,an additional test period and minimum EBITDA requirement is also to be included in such sub-clause,by adding the following provision immediately at the end of such sub-clause: “Without limiting theforegoing, the Company shall also maintain for the eight month period ending February 28, 2009, aminimum EBITDA of not less than a negative $674,000 (the “Month End February, 2009 Minimum EBITDACovenant”). In this regard, the Company will furnish to the Agent and each Lender consolidatedfinancial statements, by no later than April 10, 2009, certified by an authorized financial oraccounting officer of the Borrowing Agent, accompanied by an officer’s compliance certificate,signed by the President, Vice President, Controller,Chief Financial Officer or Treasurer, pursuant to which any one such officer must certify whetheror not the calculations based upon the above referenced financial statements demonstrate compliancewith the Month End February, 2009 Minimum EBITDA Covenant.”          (e) Supplementing the Fiscal Quarter end test periods and Leverage Ratiorequirements set forth in sub-clause (c) of Paragraph 7.10 of Section 7 of the Financing Agreement,an additional test period and Leverage Ratio requirement is also to be included in such sub-clause,by adding the following provision immediately at the end of such sub-clause: “Without limiting theforegoing, the Company shall also maintain as of its financial statement date of February 28, 2009,a maximum Leverage Ratio of not more than 5.60 to 1.00 (the “Month End February, 2009 MaximumLeverage Ratio Covenant”). In this regard, the Company will furnish to the Agent and each
 

 
Lender consolidated financial statements, by no later than April 10, 2009, certified by anauthorized financial or accounting officer of the Borrowing Agent, accompanied by an officer’scompliance certificate, signed by the President, Vice President, Controller, Chief FinancialOfficer or Treasurer, pursuant to which any one such officer must certify whether or not thecalculations based upon the above referenced financial statements demonstrate compliance with theMonth End February, 2009 Maximum Leverage Ratio Covenant.”     3.Waivers of Existing Events of Default. The Agent and the Lenders each hereby waivecompliance by the Company with the covenants set forth in sub-clauses (a) referring to Tangible NetWorth, (b) referring to Minimum EBITDA, and (c) referring to Leverage Ratio, of Paragraph 7.10 ofSection 7 of the Financing Agreement, as in effect prior hereto, solely with respect to the FiscalQuarter test period ended on December 31, 2008, in relation to each of such covenants ended on suchdate (the “Current Defaults”). The Agent and the Lenders each further agree that the CurrentDefaults shall not constitute Defaults and/or Events of Default under the Financing Agreement andthat the Agent and the Lenders each hereby waive any and all rights it may have to accelerate anyof the Obligations and exercise any other remedies against the Company or the Collateral as aresult thereof. Except to the extent set forth herein, no other waiver of, or change in any of theterms, provisions or conditions of the Financing Agreement is intended or implied. Except to theextent set forth herein, this Amendment shall not constitute a waiver of any other existingDefaults or Events of Default under the Financing Agreement (whether or not the Agent or any Lenderhas knowledge thereof), and shall not constitute a waiver of any future Defaults or Events ofDefault whatsoever. This Amendment is without prejudice to, and specifically reserves, all of therights and remedies of the Agent and each Lender against the Company under the Financing Agreement,all of which are hereby ratified and remain in full force and effect. The Company shall comply withall covenants set forth in the Financing Agreement, as amended herein, after the date of thisAmendment.     4.Conditions of Effectiveness. This Amendment shall become effective as of the date hereof uponsatisfaction of the following conditions:a. Agent’s receipt of four (4) copies of thisAmendment No. 1 duly executed by the Company andthe Guarantors; b. Agent’s receipt, for its own benefit and the ratable benefit of the Lenders, of payment of anamendment and waiver fee of $25,000.00, which fee shall be due and payable concurrently with theexecution of this Amendment and which shall be charged to the Company’s account with Agent; and c. Agent shall have received such other certificates, instruments, documents and agreements asmay reasonably be required by Agent or its counsel, each of which shall be in form and substancereasonably satisfactory to Agent and its counsel.
 

 
5.Representations and Warranties. Company hereby represents and warrants’ as follows:          (a) This Amendment and the Financing Agreement, as modified hereby, constitute legal, validand binding obligations of Company and are enforceable against Company in accordance with theirrespective terms.          (b) Company hereby reaffirms all covenants, representations and warranties made in theFinancing Agreement as amended herein are true and correct in all material respects and agrees thatall such covenants, representations and warranties, as applicable, shall be deemed to have beenremade as of the effective date of this Amendment (except to the extent of changes resulting fromtransactions contemplated or permitted by the Financing Agreement and the other Loan Documents andexcept to the extent that such representations and warranties relate expressly to an earlier date).          (c) NoEvent of Default or Default has occurred and is continuing or would exist after givingeffect to this Amendment.          (d) As of the date hereof, Company has no defense, counterclaim or offset with respect to theFinancing Agreement.     6.Governing Law. This Amendment shall be binding upon and inure to the benefit of the partieshereto and their respective successors and assigns and shall be governed by and construed inaccordance with the laws of the State of New York without regard to any conflicts of lawsprinciples thereto that would call for the application of the laws ofany other jurisdiction.     7.Headings. Section headings in this Amendment are included herein for convenience ofreference only and shall not constitute a part of this Amendment for any other purpose.     8.Counterparts. Facsimile Signatures. This Amendment may be executed by the parties heretoin one or more counterparts, each of which shall be deemed an original and all of which takentogether shall be deemed to constitute one and the same agreement. Any signature delivered by aparty by facsimile or electronic transmission shall be deemed to be an original signature hereto.     9.Effect on the Financing Agreement.     (a) Upon the effectiveness of this Amendment, each reference in the Financing Agreement to“this Agreement,” “hereunder,” “hereof,” “herein” or words of like import shall mean and be areference to the Financing Agreement as modified hereby.     (b) Except as specifically modified hereby, the Financing Agreement, and all other documents,instruments and agreements executed and/or delivered in connection therewith, shall remain in fullforce and effect, and are hereby ratified and confirmed.     (c) The security interests and liens and rights securing payment of the Obligations arehereby ratified and confirmed by the Company in all respects.IN WITNESS WHEREOF, this Amendment has been duly executed as of the day and year first writtenabove.
 

 
      CYNTHIA STEFFE ACQUISITION, LLC