**Exhibit 10(h)(2)**

**THIRD AMENDED AND RESTATED CREDIT AGREEMENT**

**between**

**CYBEX INTERNATIONAL, INC., as Borrower**

**and**

**GMAC COMMERCIAL FINANCE LLC, as Lender**

**Dated as of December, 2006**

THIS THIRD AMENDED AND RESTATED CREDIT AGREEMENT(the “Agreement”) is made as of December     , 2006, by and between CYBEX INTERNATIONAL, INC., a New York corporation (the “Borrower”), having its chief executive office at 10 Trotter Drive, Medway,Massachusetts 11779 and GMAC COMMERCIAL FINANCE LLC (the “Lender”), having an office at 600 Galleria Parkway, 15th Floor, Atlanta, Georgia 30339. 

**RECITALS:**

WHEREAS, Borrower and Lender are parties to a Credit Agreement dated as of July 13, 2004, as amended and restated by that certain Amended andRestated Credit Agreement dated as of February 1, 2005, and as further amended and restated by that certain Second Amended and Restated Credit Agreement dated as of January 31, 2006 (collectively, the “Original CreditAgreement”). 

WHEREAS, Borrower and Lender have agreed to amend and restate the Original Credit Agreement in the manner set forthherein. Borrower and Lender intend that this Agreement not effect a novation of obligations of the Borrower under the Original Credit Agreement, but merely constitute a restatement of, and where applicable, an amendment to, the terms governing suchobligations. 

NOW, THEREFORE, IT IS AGREED, in consideration of the above recitals and for other good and valuable consideration, thereceipt and adequacy of which are hereby acknowledged, Borrower and Lender agree that the Original Credit Agreement shall be amended and restated in its entirety to read, and the Borrower hereby agrees with the Lender, as follows: 

**SECTION I**

**DEFINITIONS**

1.1 Definitions. All capitalized terms used in this Agreement shall have the meanings assigned to them below: 

Acquisition. Any transaction pursuant to which the Borrower or any of its Subsidiaries (a) acquires any equity securities (or warrants,options or other rights to acquire such securities) of any Entity other than the Borrower or any Entity which is not then a Subsidiary of the Borrower, pursuant to a solicitation of tenders therefor, or in one or more negotiated block, market orother transactions not involving a tender offer, or a combination of any of the foregoing, or (b) makes any Entity a Subsidiary of the Borrower, or causes any such Entity to be merged into the Borrower or any of its Subsidiaries, in any casepursuant to a merger, purchase of assets or any reorganization providing for the delivery or issuance to the holders of such Entity’s then outstanding securities, in exchange for such securities, cash or securities of the Borrower or any of itsSubsidiaries, or a combination thereof, or (c) purchases all or substantially all of the business or assets of any Entity. 

Affiliate. With respect to any Person, any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For purposes of this definition, “control”when used with respect to any specified Person means the power to direct the management and policies of such Person, directly or indirectly, whether through 

the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative tothe foregoing. 

Agreement. This Agreement, as the same may be supplemented or amended from time to time. 

Amended and Restated Note. As defined in Section 2.1(c). 

Beneficial Ownership. Beneficial ownership as determined in accordance with Rule 13d-3 of the Securities and Exchange Commission under the Exchange Act, as in effect on the date hereof. 

Borrower. See Preamble. 

BusinessDay. As defined in the Amended and Restated Note. 

Capital Expenditures. For any period the aggregate of all expenditures of theBorrower during such period that, in conformity with GAAP, are required to be included in or reflected by the property, plant or equipment or similar fixed asset account reflected in the balance sheet of the Borrower. 

Capital Stock. Any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any andall equivalent ownership interests in an Entity (other than a corporation) and any and all warrants, rights or options to purchase any of the foregoing. 

Capitalized Leases. Leases under which the Borrower or any of its Subsidiaries is the lessee or obligor, the discounted future rental payment obligations under which are required to be capitalized on thebalance sheet of the lessee or obligor in accordance with GAAP. 

Change of Control. The occurrence of any of the following:

(a) any Person or two or more Persons acting in concert shall have acquired Beneficial Ownership, directly or indirectly, through apurchase, merger or other transaction or series of transactions or otherwise, of a number of shares of (i) common stock of the Borrower or (ii) Voting Stock of the Borrower, which in either case exceeds the number of such shares thenbeneficially owned by UM Holdings, Ltd. and its Affiliates; or 

(b) during any period of twelve (12) consecutive calendar months,individuals who were either (i) directors of the Borrower on the first day of such period, or (ii) appointed or nominated for election to the board of directors by a majority of the individuals who were members of the board of directors onthe first day of such period, shall cease to constitute a majority of the board of directors. 

Code. The Internal Revenue Code of1986 and the rules and regulations thereunder, collectively, as the same may from time to time be supplemented or amended and remain in effect. 

Collateral. All property, real or personal, in which Lender is granted a lien, or security interest, or in which title or security title is granted to or for the benefit of the Lender as security for the Obligations pursuant to theSecurity Agreement, including, without limitation, any Credit Line Asset. 

 

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Consolidated or consolidated. With reference to any term defined herein, shall mean that term asapplied to the accounts of the Borrower and its Subsidiaries, consolidated in accordance with GAAP. 

Controlled Group. All trades orbusinesses (whether or not incorporated) under common control that, together with the Borrower, are treated as a single employer under Section 414(b) or 414(c) of the Code or Section 4001 of ERISA. 

Credit Line Advance. See Section 2.2. 

Credit Line Advance Account. A deposit account designated by the Borrower by written notice to the Lender and approved by Lender. 

Credit Line Advance Rate. 100%. 

Credit Line Advance Request Deadline. See Section 2.2(c)(A). 

Credit Line Asset. New equipment and/or machinery acquired or to be acquired by Borrower with the proceeds of a Credit Line Advance. 

Credit Line Asset Purchase Price. With respect to any Credit Line Asset, the lesser of (i) the actual price paid or to be paid by theBorrower with respect to acquiring such Credit Line Asset and (ii) Lender’s determination of value (made in its sole discretion) of such Credit Line Asset based solely upon Lender’s review of such Credit Line Asset. 

Credit Line Availability. The willingness of the Lender from time to time to make Credit Line Advances to the Borrower, in Lender’s sole andabsolute discretion pursuant to this Agreement with the aggregate Credit Line Principal Amount of such Credit Line Advances never exceeding the Credit Line Maximum Availability. 

Credit Line Availability Period. The period from and including the date hereof through and including August 31, 2007. 

Credit Line Maximum Availability. $7,000,000.00. 

Credit Line Note. As defined in Section 2.1(b). 

Credit Line Principal Amount. Theoutstanding principal balance of the Amended and Restated Note as of the date of determination. 

Default. An Event of Default orevent or condition that, but for the requirement that time elapse or notice be given, or both, would constitute an Event of Default. 

EBITDA. In any period, all earnings of the Borrower for said period before all interest and tax obligations of the Borrower for said period and all depreciation and amortization expense for said period, determined in accordance withGAAP on a consistent basis 

 

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with the latest audited financial statements of the Borrower, but excluding the effect of extraordinary or non-reoccurring gains or losses for such period.

Encumbrances. See Section 6.1. 

Entity. Any corporation, limited liability company, partnership, limited liability partnership, trust, other unincorporated association, business, or other legal entity, and any Governmental Authority.

Equipment. All present and hereafter acquired equipment (as defined in the UCC) including, without limitation, all machinery,equipment, furnishings and fixtures, and all additions, substitutions and replacements thereof, wherever located, together with all attachments, components, parts, equipment and accessories installed thereon or affixed thereto and all proceedsthereof of whatever sort. 

ERISA. The Employee Retirement Income Security Act of 1974 and the rules and regulations thereunder,collectively, as the same may from time to time be supplemented or amended and remain in effect. 

Event of Default. Any eventdescribed in Section 7.1. 

Financial Covenants. The covenants set forth in Sections 5.9, and 5.10 herein. 

Fixed Charge Coverage Ratio. For any Reference Period, the ratio of the following for the Borrower and its Subsidiaries on a consolidated basisdetermined in accordance with GAAP: (a) EBITDA less non-financed Capital Expenditure for such period, less, without duplication, losses incurred in respect of Support Obligations during such period, to (b) Fixed Charges for such period.

Fixed Charges. For any applicable twelve-month period of computation, the sum of (a) interest expense paid or accrued inrespect of any Indebtedness during such period, without duplication, plus (b) taxes to the extent paid during or with respect to such period plus (c) regularly scheduled payments of principal paid on Indebtedness (excludingthe Revolving Facility) during such period. 

Funded Debt. As of any date, the Indebtedness of the Borrower and its Subsidiaries formoney borrowed from financial institutions. 

GAAP. Those generally accepted accounting principles and practices which are recognizedas such by the American Institute of Certified Public Accountants acting through its Accounting Principles Board or by the Financial Accounting Standards Board or through other appropriate boards or committees thereof, as in effect on the datehereof. 

Governmental Authority. Any foreign, federal, state, regional, local, municipal or other government, or any department,commission, board, bureau, agency, public authority or instrumentality thereof, or any court or arbitrator. 

 

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Government Lists. (i) the Specially Designated Nationals and Blocked Persons Lists maintained byOFAC, (ii) any other list of terrorists, terrorist organizations or narcotics traffickers maintained pursuant to any of the Rules and Regulations of OFAC, or (iii) any similar lists maintained by the United States Department of State, theUnited States Department of Commerce or any other governmental authority or pursuant to any Executive Order of the President of the United States of America. 

Guarantees. As applied to the Borrower and its Subsidiaries, all guarantees, endorsements or other contingent or surety obligations with respect to obligations of others whether or not reflected on theconsolidated balance sheet of the Borrower and its Subsidiaries, including any obligation to furnish funds, directly or indirectly (whether by virtue of partnership arrangements, by agreement to keep-well or otherwise), through the purchase ofgoods, supplies or services, or by way of stock purchase, capital contribution, advance or loan, or to enter into a contract for any of the foregoing, for the purpose of payment of obligations of any other person or entity. 

Indebtedness. As applied to the Borrower and its Subsidiaries, (i) all obligations for borrowed money or other extensions of credit whetheror not secured or unsecured, absolute or contingent, including, without limitation, unmatured reimbursement obligations with respect to letters of credit or guarantees issued for the account of or on behalf of the Borrower and its Subsidiaries andall obligations representing the deferred purchase price of property, other than accounts payable arising in the ordinary course of business, (ii) all obligations evidenced by bonds, notes, debentures or other similar instruments,(iii) all obligations secured by any mortgage, pledge, security interest or other lien on property owned or acquired by the Borrower or any of its Subsidiaries whether or not the obligations secured thereby shall have been assumed,(iv) that portion of all obligations arising under Capitalized Leases that is required to be capitalized on the consolidated balance sheet of the Borrower and its Subsidiaries, (v) all Guarantees, and (vi) all obligations that areimmediately due and payable out of the proceeds of or production from property now or hereafter owned or acquired by the Borrower or any of its Subsidiaries. 

Lender. See Preamble. 

Leverage Ratio. For any Reference Period, the ratio of Funded Debt toEBITDA. 

Loan Documents. This Agreement, the Amended and Restated Note, the Security Agreement, and each other document executed anddelivered by Borrower to Lender in connection with the Loan. 

Loan. The loan described in Section 2.2. 

Obligations. Any and all obligations of the Borrower to the Lender of every kind and description, direct or indirect, absolute or contingent,primary or secondary, due or to become due, now existing or hereafter arising, regardless of how they arise or by what agreement or instrument, if any, and including obligations to perform acts and refrain from taking action as well as obligationsto pay money. 

OFAC. The United States Office of Foreign Assets Control. 

 

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Original Credit Agreement. As defined in the recitals. 

Patriot Act. The Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT ACT)Act of 2001, as the same may be amended from time to time, and corresponding provisions of future laws. 

Patriot Act Offense. Anyviolation of the criminal laws of the United States of America or of any of the several states, or that would be a criminal violation if committed within the jurisdiction of the United States of America or any of the several states, relating toterrorism or the laundering of monetary instruments, including any offense under (a) the criminal laws against terrorism; (b) the criminal laws against money laundering, (c) the Bank Secrecy Act, as amended, (d) the MoneyLaundering Control Act of 1986, as amended, or (e) the Patriot Act. “Patriot Act Offense” also includes the crimes of conspiracy to commit, or aiding and abetting another to commit, a Patriot Act Offense. 

PBGC. The Pension Benefit Guaranty Corporation or any entity succeeding to any or all of its functions under ERISA. 

Permitted Exceptions. (a) Purchase Money Liens; (b) statutory liens of landlords and liens of carriers, warehousemen, mechanics,materialmen and other like liens imposed by law, created in the ordinary course of business and for amounts not yet due (or which are being contested in good faith, by appropriate proceedings or other appropriate actions which are sufficient toprevent imminent foreclosure of such liens) and with respect to which adequate reserves or other appropriate provisions are being maintained by the Borrower in accordance with GAAP; (c) liens granted to Lender by the Borrower; (d) taxliens which are not yet due and payable or which are being diligently contested in good faith by the Borrower by appropriate proceedings, and which liens are not (A) filed on any public records, (B) senior to the liens of Lender, or(C) for Taxes due the United States of America or any state thereof having similar priority statutes; and (e) liens securing Capitalized Leases, provided that (1) each lien securing such Capitalized Leases shall attach only tothe property being leased, (2) a description of the assets being leased is furnished to Lender, and (3) the debt incurred in connection with such Capitalized Leases shall not exceed, in the aggregate, $1,500,000.00 in any calendar year.

Person. Any individual or Entity. 

Plan. At any time, an employee pension or other benefit plan that is subject to Title IV of ERISA or subject to the minimum funding standards under Section 412 of the Code and is either (i) maintainedby the Borrower or any member of the Controlled Group for employees of the Borrower or any member of the Controlled Group or (ii) if such Plan is established, maintained pursuant to a collective bargaining agreement or any other arrangementunder which more than one employer makes contributions and to which the Borrower or any member of the Controlled Group is then making or accruing an obligation to make contributions or has within the preceding five Plan years made contributions.

Proposed Credit Line Advance Notice. See Section 2.2(c)(A). 

 

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Purchase Money Liens. Liens on any item of Equipment acquired after the date of this Agreementprovided that (a) each such lien shall attach only to the property to be acquired, (b) a description of the Equipment so acquired is furnished to Lender, and (c) the debt incurred in connection with such acquisitions shall not exceed,in the aggregate, $300,000.00 in any calendar year. 

Reference Period. As of any date of determination, the period of four(4) consecutive fiscal quarters of the Borrower and its Subsidiaries ending on such date, or if such date is not a fiscal quarter end date, the period of four (4) consecutive fiscal quarters most recently ended (in each case treated as asingle accounting period). 

Request for Advance. See Section 2.2(c)(A). 

Revolving Facility. The loan facility established pursuant to that certain Financing Agreement dated as of July 16, 2003 by and between TheCIT Group/Business Credit, Inc., and Borrower, and any modification, extension, refinancing or replacement of said loan facility. 

Security Agreement. The Security Agreement dated as of the date hereof made by Borrower in favor of Lender. 

Subsidiary. Any Entity of which 50% or more of the ordinary Voting Power for the election of a majority of the members of the board of directors or other governing body of such Entity is held or controlled by the Borrower or aSubsidiary of the Borrower; or any other such Entity the management of which is directly or indirectly controlled by the Borrower or a Subsidiary of the Borrower through the exercise of Voting Power or otherwise; or any joint venture, whetherincorporated or not, in which the Borrower has a 50% ownership interest. 

Support Obligations. All recourse Indebtedness withrespect to leases and third party financing arrangements pertaining to the Borrower’s products and related matters. 

Taxes. Allfederal, state, municipal and other governmental taxes, levies, charges, claims and assessments which are or may be due by the Borrower with respect to its business, operations, Collateral or otherwise. 

Term Loan. As defined in Section 2.1(a). 

UCC. The Uniform Commercial Code as in effect from time to time in the state of New York. 

VotingPower. means, with respect to any Voting Stock of any Entity at any time, the number of votes entitled to vote generally in the election of directors of such Entity that are attributable to such Voting Stock at such time divided by the number ofvotes entitled to vote generally in the election of directors of such Entity that are attributable to all shares of Capital Stock of such Entity (including such Voting Stock) at such time. 

Voting Stock. Capital Stock issued by a corporation, or equivalent interests in any other Entity, the holders of which are ordinarily, in theabsence of contingencies, entitled to vote for the election of directors (or persons performing similar functions) of such Entity, even if the right so to vote has been suspended by the happening of such a contingency. 

 

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1.2 Accounting Terms. All terms of an accounting character shall have the meanings assignedthereto by GAAP applied on a basis consistent with the financial statements referred to in Section 4.6 of this Agreement, modified to the extent, but only to the extent, that such meanings are specifically modified herein. 

**SECTION II**

**DESCRIPTION OF CREDIT**

2.1 The Term Loan and Credit Line Note.

(a) Term Loan. Lender made a term loan to Borrower in the original principal amount of $11,000,000.00 on July 13, 2004 (the “Term Loan”) subject to the terms of the Original Credit Agreement. TheTerm Loan has been paid in full and the indebtedness evidenced thereby is fully satisfied. 

(b) Credit Line Note. Lender made acredit line available to Borrower in the original principal amount of $3,000,000.00 on February 1, 2005 subject to the terms of the Original Credit Agreement. The credit line availability period expired on September 30, 2005 in accordancewith the terms of the Original Credit Agreement. Such credit line loan is evidenced by and is payable in accordance with the terms and provisions of the Credit Line Note dated as of February 1, 2005 (the “Credit Line Note”). Theoutstanding principal balance of the Credit Line Note as of December 1, 2006 is $100.00, plus accrued and unpaid interest. 

(c)Amended and Restated Note. As of the date hereof, Borrower has executed and delivered, or will execute and deliver, to Lender, an amended and restated Credit Line Note in the form of Exhibit A annexed hereto, which shall be dated as of thedate of this Agreement, in the principal amount of $7,000,000.00 (the “Amended and Restated Note”). The Amended and Restated Note shall constitute a restatement of and, where applicable, an amended to the Credit Line Note. The Amended andRestated Note shall mature and the entire unpaid balance due thereunder shall be payable as described therein. 

2.2 The Credit LineLoan. 

(a) Credit Line Availability. Subject to and upon the terms and conditions set forth herein, Lender may, in its sole andabsolute discretion, at any time and from time to time during the Credit Line Availability Period (or such earlier date as the Credit Line Availability shall have been terminated pursuant to the terms hereof), make an advance or advances (each a“Credit Line Advance” and, collectively, the “Credit Line Advances”) to Borrower, which Credit Line Advance: (a) shall be made in Lender’s sole and absolute discretion at any time and from time to time; (b) ifmade, shall constitute purchase money financing; (c) if made, shall bear interest and shall be payable in accordance with the terms and provisions of the Amended and Restated Note; and (d), if made, shall be secured by the Collateral, provided,however, that the sum of (i) the Credit Line Principal Amount plus (ii) the amount requested in the Request for Advance (and any outstanding but unfunded Requests for Advance) shall not exceed the Credit Line Maximum Availability. Any andall Credit Line Advances made pursuant to this Section 2.2 shall also be referred to as the “Loan”. 

 

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(b) Minimum Borrowing Amount. The principal amount of each Credit Line Advance shall not be lessthan $500,000.00. 

(c) Maximum Number of Credit Line Advances.Notwithstanding anything to the contrary herein, during the Credit Line Availability Period (or such earlier date as the Credit Line Availability shall have been terminated pursuant to the terms hereof), Lender shall make no more than seven(7) Credit Line Advances to Borrower; even if after the seventh (7th) Credit Line Advance (a) theCredit Line Availability Period has not yet expired, and (b) the total of all funds advanced is less than the Credit Line Maximum Availability. 

(d) Requests for Advance. 

(A)Whenever Borrower desires to incur a Credit Line Advance hereunder, it shall first provide Lender with sufficient notice (a “Proposed Credit Line Advance Notice”) and time to conduct and/or require, at Borrower’s expense, duediligence of any kind as Lender reasonably requires on any Credit Line Asset which Borrower contemplates including in a Request for Advance as a Credit Line Asset to be financed by a Credit Line Advance and in which a lien will be granted to Lenderas collateral for the Loan. Upon completion (or earlier if agreed to by Lender in its sole discretion) of any and all due diligence and Lender’s agreement to finance a Credit Line Asset subject to the due diligence review, Borrower shall thendeliver to the Lender (i) a Request for Advance substantially in the form of Exhibit E (the “Request for Advance”) and (ii) any other information requested by Lender not later than 10:00 a.m. (New York City time) on the third(3rd) Business Day prior to the proposed date of such Credit Line Advance (the “Credit Line AdvanceRequest Deadline”). Each Request for Advance: (A) shall be appropriately completed to specify the aggregate principal amount of the Credit Line Advance to be made and the proposed date of such Credit Line Advance (which shall be a BusinessDay); and (B) the calculation for determining the amount requested in such Request for Advance, including the Credit Line Asset Purchase Price for each Credit Line Asset, as applicable and the Credit Line Advance Rate and verification thatamount of the requested Credit Line Advance plus the Credit Line Principal Amount does not violate this Section 2.2. The Borrower may withdraw any Proposed Credit Line Advance Notice or Request for Advance at any time prior to the Credit LineAdvance being made. 

(B) In no event shall Lender make any Credit Line Advance unless (i) Lender shall have receivedprior to the applicable Credit Line Advance Request Deadline evidence reasonably satisfactory to Lender in all respects that it shall have a first priority lien on the Credit Line Asset to be financed by a Credit Line Advance upon the funding of theCredit Line Advance, (ii) Lender shall have completed its due diligence and be reasonably satisfied with the results thereof, (iii) all conditions set forth in Section III have been and continue to be satisfied in all material respects,and (iv) all representations and warranties set forth in Section IV are true, accurate and complete in all material respects. 

 

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(C) Notwithstanding anything contained herein to the contrary, but subject to theprovisions of this Section II, the amount requested in each Request for Advance shall not exceed, unless waived by the Lender in its sole discretion, the product of the (i) the Credit Line Advance Rate multiplied by (ii) the Credit LineAsset Purchase Price for the Credit Line Asset included in such applicable Request for Advance. 

(e) Disbursement of Funds. On thedate specified in the Request for Advance with respect to any requested Credit Line Advance, the Lender may make available to the Borrower the requested amount of such Credit Line Advance in Dollars by wire transfer of funds to the Borrower’sCredit Line Advance Account unless, the Lender, in its sole discretion, determines that such funds are to be wire transferred to Persons selling such Credit Line Asset in which case the funds shall be transferred as provided in any instructionalletters or documents received from such Persons; such letters being in form and substance satisfactory to Lender. 

**SECTION III**

**CONDITIONS PRECEDENT TO EACH CREDIT LINE ADVANCE**

3.1 Conditions Precedent to Each Credit Line Advance. The obligation of the Lender to make any Credit Line Advance is subject to the condition precedent that the Lender shall have received, in form andsubstance satisfactory to the Lender and its counsel, the following: 

(a) this Agreement, the Amended and Restated Note, the SecurityAgreement and the other Loan Documents, duly executed by the Borrower; 

(b) a certificate of the Secretary or an Assistant Secretary (orequivalent officer) of the Borrower with respect to resolutions of the Board of Directors (or equivalent governing body) authorizing the execution and delivery of this Agreement, the Amended and Restated Note, the Security Agreement and the otherLoan Documents and identifying the officer(s) authorized to execute, deliver and take all other actions required under this Agreement, and providing specimen signatures of such officers; 

(c) the certificate of incorporation, articles of organization, or other substantially similar formative documents of the Borrower and all amendments andsupplements thereto, filed in the office of the Secretary of State of New York, each certified by said Secretary of State as being a true and correct copy thereof (receipt of which is acknowledged by Lender); 

(d) the bylaws, operating agreement, or other substantially similar governance document of the Borrower and all amendments and supplements thereto,certified by the Secretary or an Assistant Secretary (or equivalent officer) as being a true and correct copy thereof (receipt of which is acknowledged by Lender); 

(e) a certificate of the Secretary of State of New York, as to the Borrower’s legal existence and good standing in such state and listing all documents on file in the office of said Secretary of State and acertificate of the Secretary of State of each of Massachusetts and Minnesota, and any State other than New York, Massachusetts and Minnesota in which any of the Collateral is located, with respect to the qualification and good standing of Borroweras a foreign corporation in such state (receipt of which is acknowledged by Lender); 

 

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(f) documentary evidence acceptable to Lender as to the tax good standing of Borrower as a corporation inNew York and as a foreign corporation in each of Massachusetts and Minnesota (receipt of which is acknowledged by Lender); 

(g)Intentionally deleted; 

(h) Intentionally deleted; 

(i) Intentionally deleted; 

(j) documentary evidence of the insurance coverage required pursuant to theLoan Documents; 

(k) lien searches deemed appropriate by Lender’s counsel; 

(l) evidence of no material adverse change in the condition (financial, business or otherwise) of Borrower; 

(m) a Collateral inspection report or appraisal of the Collateral, including without limitation all Credit Line Assets in a form and substancesatisfactory to Lender; 

(n) such other documents, and completion of such other matters, as counsel for the Lender may reasonably deemnecessary or appropriate; and 

(o) payment of all expenses incurred by Lender in connection with the closing of the Credit Line Advance.

**SECTION IV**

**REPRESENTATIONS AND WARRANTIES**

In order to induce the Lender to enter into this Agreement and to make Loan hereunder, theBorrower represents and warrants to the Lender that: 

4.1 Organization and Qualification. Each of the Borrower and its Subsidiaries(a) is duly organized, validly existing and in good standing under the laws of its jurisdiction of organization, (b) has all requisite power to own its property and conduct its business as now conducted and as presently contemplated and(c) is duly qualified and in good standing and is duly authorized to do business in each jurisdiction where the nature of its properties or business requires such qualification, except where the failure to be so qualified does not have amaterial adverse effect on the properties or business of the Borrower and its Subsidiaries taken as a whole. 

4.2 Authority. Theexecution, delivery and performance of this Agreement, the Amended and Restated Note, the Security Agreement, and the other Loan Documents and the transactions contemplated hereby are within the power and authority of the Borrower and have beenauthorized by all necessary corporate proceedings, and do not and will not (a) require any consent or approval of the stockholders, members, or other holders of Capital Stock of the Borrower, (b) contravene any provision of the charterdocuments or by-laws of the Borrower or any law, rule or regulation applicable to the Borrower, (c) contravene any provision of, or 

 

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constitute an event of default or event that, but for the requirement that time elapse or notice be given, or both, would constitute an event of defaultunder, any other agreement, instrument, order or undertaking binding on the Borrower, or (d) result in or require the imposition of any Encumbrance on any of the properties, assets or rights of the Borrower except for the Encumbrances in favorof Lender created by the Security Agreement. 

4.3 Valid Obligations. This Agreement, the Amended and Restated Note, the SecurityAgreement, and the other Loan Documents and all of their respective terms and provisions are the legal, valid and binding obligations of the Borrower, enforceable in accordance with their respective terms except as limited by bankruptcy, insolvency,reorganization, moratorium or other laws affecting the enforcement of creditors’ rights generally, and except as the remedy of specific performance or of injunctive relief is subject to the discretion of the court before which any proceedingtherefor may be brought. 

4.4 Consents or Approvals. The execution, delivery and performance of this Agreement, the Amended andRestated Note, the Security Agreement, and the other Loan Documents and the transactions contemplated herein do not require any approval or consent of, or filing or registration with, any governmental or other agency or authority, or any other party(except for the filing of UCC-1 financing statements and the recording of the Security Agreement). 

4.5 Title to Properties; Absence ofEncumbrances. Each of the Borrower and its Subsidiaries has good and marketable title to all of the properties, assets and rights of every name and nature now purported to be owned by it, including, without limitation, such properties, assetsand rights as are reflected in the financial statements referred to in Section 4.6 (except such properties, assets or rights as have been disposed of in the ordinary course of business since the date thereof), free from all defects of titlethat might materially adversely affect such properties, assets or rights, taken as a whole. The Collateral is free from all Encumbrances other than Permitted Exceptions. 

4.6 Financial Statements. The Borrower has also furnished the Lender its consolidated balance sheet as of September 30, 2006 and its consolidated statement of operations for the fiscal period then ended,certified by the principal financial officer of the Borrower but subject, however, to normal, recurring year-end adjustments that shall not in the aggregate be material in amount. All such financial statements were prepared in accordance with GAAPapplied on a consistent basis throughout the periods specified and present fairly in all material respects the financial position of the Borrower and its Subsidiaries as of such dates and the results of the operations of the Borrower and itsSubsidiaries for such periods. Except as otherwise disclosed to Lender in writing, there are no liabilities, contingent or otherwise, not disclosed in such financial statements or the notes thereto that involve a material amount. 

4.7 Changes. Since the date of the most recent financial statements referred to in Section 4.6, there have been no changes in the assets,liabilities, financial condition, business or prospects of the Borrower or any of its Subsidiaries other than changes in the ordinary course of business, the effect of which has not, in the aggregate, been materially adverse. 

 

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4.8 Defaults. As of the date of this Agreement, no Default or Event of Default exists. 

4.9 Taxes. The Borrower and each Subsidiary have filed all federal, state and other tax returns required to be filed, and all taxes,assessments and other governmental charges due from the Borrower and each Subsidiary have been fully paid. The Borrower and each Subsidiary have established on their books reserves adequate for the payment of all federal, state and other taxliabilities. 

4.10 Litigation. Except as set forth on Exhibit B hereto, there is no litigation, arbitration, proceeding orinvestigation pending, or, to the knowledge of the Borrower’s or any Subsidiary’s officers, threatened, against the Borrower or any Subsidiary that, if adversely determined, could result in a material judgment not fully covered byinsurance, could result in a forfeiture of all or any substantial part of the property of the Borrower or its Subsidiaries, or could otherwise have a material adverse effect on the assets, business or prospects of the Borrower or any Subsidiary.

4.11 Use of Proceeds. No portion of the Loan is to be used for the “purpose of purchasing or carrying” any “marginstock” as such terms are used in Regulations U and X of the Board of Governors of the Federal Reserve System, 12 C.F.R. 221 and 224, as amended. The proceeds of the Loan shall be used solely for the legal purposes set forth in Borrower’sapplication to Lender for the Loan. 

4.12 Subsidiaries. As of the date of this Agreement, all the Subsidiaries of the Borrower arelisted on Exhibit C hereto. The Borrower or a Subsidiary of the Borrower is the owner, free and clear of all liens and encumbrances, of all of the issued and outstanding Capital Stock of each Subsidiary. All shares of such Capital Stock have beenvalidly issued and are fully paid and nonassessable, and no rights to subscribe to any additional shares have been granted, and no options, warrants or similar rights are outstanding. 

4.13 Investment Company Act. Neither the Borrower nor any of its Subsidiaries is subject to regulation under the Investment Company Act of 1940,as amended. 

4.14 Compliance with ERISA. The Borrower and each member of the Controlled Group have fulfilled their obligations underthe minimum funding standards of ERISA and the Code with respect to each Plan and are in compliance in all material respects with the applicable provisions of ERISA and the Code, and have not incurred any liability to the PBGC or a Plan under TitleIV of ERISA; and no “prohibited transaction” or “reportable event” (as such terms are defined in ERISA) has occurred with respect to any Plan. 

4.15 Burdensome Obligations. Neither the Borrower nor any of its Subsidiaries is a party to or bound by any franchise, agreement, deed, lease or other instrument, or subject to any charter, by-law or otherrestriction which is so unusual or burdensome that it may materially and adversely affect or impair the business or condition, financial or otherwise, of the Borrower and its Subsidiaries taken as a whole. The Borrower does not presently anticipatethat future expenditures needed to meet the provisions of federal or state statutes, orders, rules or regulations will be so burdensome as to affect or impair in a materially adverse manner the business or condition, financial or otherwise of theBorrower and its Subsidiaries taken as a whole. Neither the Borrower nor any of 

 

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its Subsidiaries has any obligation of any kind (whether fixed, accrued, contingent, unmatured or otherwise) which may have a material adverse effect on thebusiness or condition, financial or otherwise, of the Borrower and its Subsidiaries taken as a whole. 

4.16 Labor Matters. Neitherthe Borrower nor any of its Subsidiaries has experienced any strike, labor dispute, slowdown or work stoppage due to labor disagreements which would have a materially adverse effect on the Borrower’s and its Subsidiary’s business orcondition taken as a whole, financial or otherwise, and, to the best knowledge of the Borrower, there is no such strike, dispute, slowdown or work stoppage threatened against the Borrower or any of its Subsidiaries. 

4.17 Intellectual Property. Borrower has sufficient rights to, and does not infringe upon the rights of any other Person with respect to,sufficient patents, copyrights, trademarks, and licenses for such intellectual property as is necessary to carry on its business operations and own, lease and use its assets. 

4.18 Solvency. Borrower is and shall at closing be solvent and able to pay its debts as they become due and possesses and shall possess sufficientcapital to operate its business and own its assets. Borrower shall not be rendered insolvent by the execution, delivery and performance of its obligations under this Agreement and the other Loan Documents nor by the completion of the transactionscontemplated thereby. 

4.19 Security Interest. Upon the proper filing of the financing statements in the appropriate secretary ofstates’ offices (which proper filing shall include, without limitation, the payment of all required filing fees and recording taxes), the security interest created in favor of the Lender under the Security Agreement shall constitute a firstpriority perfected security interest in the Collateral referred to therein subject to no other security interest of any other Person except for Permitted Exceptions. 

4.20 Perfection Certificate. All information set forth on the certificate entitled “Perfection Certificate” (the “Perfection Certificate”), if such certificate has been requested by theLender, pertaining to the Borrower is accurate and complete, and there has been no change in any of such information since the date on which the Perfection Certificate was signed by the Borrower. 

4.21 Patriot Act Representations. Neither the Borrower nor any Affiliates of the Borrower (a) is listed on any Government Lists, (b) isa person who has been determined by competent authority to be subject to the prohibitions contained in Presidential Executive Order No. 13224 (Sept. 23, 2001) or any other similar prohibitions contained in the rules and regulations of OFAC orin any enabling legislation or other Presidential Executive Orders in respect thereof, (c) has been previously indicted for or convicted of any felony involving a crime or crimes of moral turpitude or for any Patriot Act Offense, or (d) isnot currently under investigation by any governmental authority for alleged criminal activity. 

 

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**SECTION V**

**AFFIRMATIVE COVENANTS**

So long as the Loan or other Obligation remains outstanding, the Borrowercovenants as follows: 

5.1 Financial Statements and other Reporting Requirements. The Borrower shall furnish to the Lender:

(a) as soon as practicable, but in any event not later than one hundred five (105) days after the end of each fiscal year of theBorrower (provided, however, that if such document is required to be delivered to the Securities and Exchange Commission prior to such date such document shall be provided to Lender promptly after delivery thereof to the Securities and ExchangeCommission), the consolidated balance sheet of the Borrowers and their Subsidiaries, and the consolidating balance sheet of the Borrowers and their Subsidiaries each as at the end of such year, and the related consolidated statement of income andconsolidated statement of cash flow and, upon the Lender’s request, the consolidating statement of income and consolidating statement of cash flow for such year, each setting forth in comparative form the figures for the previous fiscal year,and all such consolidated and consolidating statements to be in reasonable detail, prepared in accordance with GAAP, and certified (with respect to the consolidated financial statements only) without qualification and without an expression ofuncertainty as to the ability of each of the Borrowers or any of their Subsidiaries to continue as going concerns, by independent certified public accountants satisfactory to the Lender (it being understood that to the extent the Borrowers’Form 10-K filed with the Securities and Exchange Commission within such 105 day period contains all of the foregoing information, the Borrowers’ providing a copy of such Form 10-K and any document incorporated therein by reference to the Lendershall be sufficient); 

(b) as soon as practicable, but in any event not later than sixty (60) days after the end of each of the fiscalquarters of the Borrower (provided, however, that if such document is required to be delivered to the Securities and Exchange Commission prior to such date, such document shall be provided to Lender promptly after delivery thereof to the Securitiesand Exchange Commission), copies of the unaudited consolidated balance sheet of the Borrowers and their Subsidiaries and, upon Lender’s request, the unaudited consolidating balance sheet of the Borrowers and their Subsidiaries, each as at theend of such quarter, and the related consolidated statement of income and consolidated statement of cash flow and, upon the Lender’s request, consolidating statement of income and cash flow for the portion of the Borrowers’ fiscal yearthen elapsed, and including a comparison to the projections of the annual operating budget of the Borrowers and their Subsidiaries all in reasonable detail and prepared in accordance with GAAP (it being understood that to the extent theBorrowers’ Form 10-Q filed with the Securities and Exchange Commission within such 60 day period contains all of the foregoing information, the Borrowers’ providing a copy of such form 10-Q to the Lender shall be sufficient); 

(c) concurrently with the delivery of each financial statement pursuant to subsections (a) and (b) of this Section 5.1, a report insubstantially the form of Exhibit D hereto signed on behalf of the Borrower by its chief operating officer; 

(d) Intentionally deleted;

(e) promptly after the same are available, copies of all proxy statements, financial statements and reports as the Borrower shall send toits stockholders or as the Borrower may file with the Securities and Exchange Commission or any governmental authority at any time having jurisdiction over the Borrower or its Subsidiaries; 

 

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(f) if and when the Borrower gives or is required to give notice to the PBGC of any “ReportableEvent” (as defined in Section 4043 of ERISA) with respect to any Plan that might constitute grounds for a termination of such Plan under Title IV of ERISA, or knows that any member of the Controlled Group or the plan administrator of anyPlan has given or is required to give notice of any such Reportable Event, a copy of the notice of such Reportable Event given or required to be given to the PBGC; 

(g) immediately upon becoming aware of the existence of any condition or event that constitutes a Default, written notice thereof specifying the nature and duration thereof and the action being or proposed to be takenwith respect thereto; 

(h) promptly upon becoming aware of any litigation or of any investigative proceedings by a Governmental Authoritycommenced or threatened against the Borrower or any of its Subsidiaries of which it has notice, the outcome of which would or might have a materially adverse effect on the assets, business or prospects of the Borrower or the Borrower and itsSubsidiaries on a consolidated basis, written notice thereof and the action being or proposed to be taken with respect thereto; 

(i) fromtime to time, such other financial data and information about the Borrower or its Subsidiaries as the Lender may reasonably request. 

5.2Conduct of Business. Each of the Borrower and its Subsidiaries shall: 

(a) duly observe and comply in all material respects with allapplicable laws and valid requirements of any Governmental Authorities relative to its existence, rights and franchises, to the conduct of its business (including, without limitation, all applicable provisions of the federal Fair Labor StandardsAct, as amended) and to its property and assets (including without limitation all environmental laws and ERISA), and shall maintain and keep in full force and effect all licenses and permits necessary in any material respect to the proper conduct ofits business, and preserve, protect, maintain and defend all material trademarks, trade names, copyrights, patents, licenses, and rights in any thereof, in each case free of any claims or infringements; 

(b) maintain its existence; and 

(c) remainengaged substantially in the business in which it is presently engaged. 

5.3 Maintenance and Insurance. Each of the Borrower and itsSubsidiaries shall maintain the Collateral and its other properties in good repair, working order and condition as required for the normal conduct of its business. Each of the Borrower and its Subsidiaries shall at all times maintain liability andcasualty insurance as required in accordance with the terms of the Security Agreement. 

5.4 Taxes. The Borrower shall pay or causeto be paid all taxes, assessments or governmental charges on or against it or any of its Subsidiaries or its or their properties on or prior to the time when they become due; provided that this covenant shall not apply to 

 

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any tax, assessment or charge that is being contested in good faith by appropriate proceedings and with respect to which adequate reserves have beenestablished and are being maintained in accordance with generally accepted accounting principles if no lien shall have been filed to secure such tax, assessment or charges. 

5.5 Inspection by the Lender. The Borrower shall permit the Lender or its designees, at any reasonable time, and upon reasonable notice (or if aDefault shall have occurred and is continuing, at any time and without prior notice), to (i) visit and inspect the properties of the Borrower and its Subsidiaries, (ii) examine and make copies of and take abstracts from the books andrecords of the Borrower and its Subsidiaries, and (iii) discuss the affairs, finances and accounts of the Borrower and its Subsidiaries with their appropriate officers, employees and accountants. In handling such information the Lender shallexercise the same degree of care that it exercises with respect to its own proprietary information of the same types to maintain the confidentiality of any non-public information thereby received or received pursuant to subsections 5.1(a), (b), or(c) except that disclosure of such information may be made (i) to the Subsidiaries or Affiliates of the Lender in connection with their present or prospective business relations with the Borrower, (ii) to prospective transferees orpurchasers of an interest in the Loan, (iii) as required by law, regulation, rule or order, subpoena, judicial order or similar order and (iv) as may be required in connection with the examination, audit or similar investigation of theLender. 

5.6 Maintenance of Books and Records. Borrower shall keep adequate books and records of account, in which true and completeentries will be made reflecting in all material respects all of its business and financial transactions, and such entries will be made in accordance with GAAP consistently applied and applicable law. Borrower shall maintain duplicate copies of allsuch books and records (i) on-site at all times, and (ii) off-site updated on a monthly basis. 

5.7 Further Assurances. Atany time and from time to time the Borrower shall, and shall cause each of its Subsidiaries to, execute and deliver such further instruments and take such further action as may reasonably be requested by the Lender to effect the purposes of thisAgreement and the Amended and Restated Note. 

5.8 Patriot Act Compliance. Borrower will use its good faith and commerciallyreasonable efforts to comply with the Patriot Act and all applicable requirements of governmental authorities having jurisdiction of the Borrower and the Collateral, including those relating to money laundering and terrorism. The Lender shall havethe right to audit the Borrower’s compliance with the Patriot Act and all applicable requirements of governmental authorities having jurisdiction of the Borrower and the Collateral, including those relating to money laundering and terrorism. Inthe event that the Borrower fails to comply with the Patriot Act or any such requirements of governmental authorities, then the Lender may, at its option, cause the Borrower to comply therewith and any and all reasonable costs and expenses incurredby the Lender in connection therewith shall be secured by the Security Agreement and the other Loan Documents and shall be immediately due and payable. 

5.9 Fixed Charge Coverage Ratio. The Borrower will not permit the Fixed Charge Coverage Ratio as determined for any Reference Period to be less than 1.2 to 1.0. 

 

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5.10 Leverage Ratio. The Borrower will not permit the Leverage Ratio as determined for anyReference Period, to be greater than 5.00 to 1.00. 

**SECTION VI**

**NEGATIVE COVENANTS**

So long as the Loan or other Obligation remainsoutstanding, the Borrower covenants as follows: 

6.1 Encumbrances. Neither the Borrower nor any of its Subsidiaries shall create,incur, assume or suffer to exist any mortgage, pledge, security interest, lien or other charge or encumbrance, including the lien or retained security title of a conditional vendor (“Encumbrances”), upon or with respect to any Collateralexcept for Permitted Exceptions. 

6.2 Name; Type of Organization; Merger; Consolidation; Acquisitions; Sale or Lease of Assets. TheBorrower shall not, without providing at least thirty (30) days prior written notice to the Lender, change its name or place of business. The Borrower shall not change its type of organization, jurisdiction of organization or other legalstructure. Neither the Borrower nor any of its Subsidiaries shall sell, lease or otherwise dispose of any material portion of their consolidated assets or properties other than in the ordinary course of business, or liquidate, merge or consolidateinto or with any other Person, or make any Acquisition, unless (i) Borrower shall have provided Lender with prior written notice and details concerning each such action, and (ii) no material adverse change in the financial condition ofBorrower would result from such action; provided that any Subsidiary of the Borrower may merge or consolidate into or with (x) the Borrower if no Default has occurred and is continuing or would result from such merger and if the Borrower is thesurviving company, or (y) any other wholly-owned Subsidiary of the Borrower; and, provided further, that the Borrower and its Subsidiaries may make Acquisitions so long as the aggregate consideration paid does not exceed $1,000,000.00 in anyfiscal year. Borrower shall not sell, lease or otherwise dispose of any Collateral, except as expressly permitted by the Security Agreement. 

6.3 ERISA. Neither the Borrower nor any member of the Controlled Group shall permit any Plan maintained by it to (i) engage in any “prohibited transaction” (as defined in Section 4975 of the Code, (ii) incurany “accumulated funding deficiency” (as defined in Section 302 of ERISA) whether or not waived, or (iii) terminate any Plan in a manner that could result in the imposition of a lien or encumbrance on the assets of the Borroweror any of its Subsidiaries pursuant to Section 4068 of ERISA. 

**SECTION VII**

**DEFAULTS**

7.1 Events ofDefault. There shall be an Event of Default hereunder if any of the following events occurs: 

(a) the Borrower shall fail to pay on or prior to the fifth (5th) day followingthe date when due (i) any amount of principal of the Loan, or (ii) any amount of interest thereon or any fees or expenses payable hereunder, under the Amended and Restated Note, the Security Agreement, or under any of the other LoanDocuments; or 

 

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(b) The Borrower shall fail to perform any term, covenant or agreement contained in Section 5.1 orany Financial Covenant; or 

(c) the Borrower shall fail to perform any covenant contained in Section 5.2, and such failure shallcontinue for ten 10 days; or 

(d) the Borrower shall fail to perform any term, covenant or agreement (other than in respect of subsections7.1(a) through (c) hereof) contained in this Agreement and such default shall continue for 30 days after notice thereof has been sent to the Borrower by the Lender; or 

(e) any representation or warranty of the Borrower made in this Agreement, the Amended and Restated Note, the Security Agreement or any other LoanDocuments or in any certificate delivered hereunder shall prove to have been false in any material respect upon the date when made or deemed to have been made; or 

(f) Intentionally deleted; or 

(g) the Borrower or any of its Subsidiaries shall fail to pay at maturity,or within any applicable period of grace, any obligations in excess of $250,000.00 in the aggregate for borrowed monies or advances, or for the use of real or personal property, or fail to observe or perform any term, covenant or agreementevidencing or securing such obligations for borrowed monies or advances, or relating to such use of real or personal property, the result of which failure is to permit the holder or holders of such Indebtedness to cause such Indebtedness to becomedue prior to its stated maturity upon delivery of required notice, if any; or 

(h) the Borrower or any of its Subsidiaries shall(i) apply for or consent to the appointment of, or the taking of possession by, a receiver, custodian, trustee, liquidator or similar official of itself or of all or a substantial part of its property, (ii) be generally not paying itsdebts as such debts become due, (iii) make a general assignment for the benefit of its creditors, (iv) commence a voluntary case under any law relating to bankruptcy, (v) take any action or commence any case or proceeding under anylaw relating to bankruptcy, insolvency, reorganization, winding-up or composition or adjustment of debts, or any other law providing for the relief of debtors, (vi) fail to contest in a timely or appropriate manner, or acquiesce in writing to,any petition filed against it in an involuntary case under any laws relating to bankruptcy, (vii) take any action under the laws of its jurisdiction of incorporation or organization similar to any of the foregoing, or (viii) take anyaction for the purpose of effecting any of the foregoing; or 

(i) a proceeding or case shall be commenced, without the application orconsent of the Borrower or any of its Subsidiaries in any court of competent jurisdiction, seeking (i) the liquidation, reorganization, dissolution, winding up, or composition or readjustment of its debts, (ii) the appointment of atrustee, receiver, custodian, liquidator or the like of it or of all or any substantial part of its assets, or (iii) similar relief in respect of it, under any law relating to bankruptcy, insolvency, reorganization, winding-up or composition oradjustment of debts or any other law providing for the relief of debtors, and such proceeding or case shall continue undismissed, or 

 

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unstayed and in effect, for a period of thirty (30) days; or an order for relief shall be entered in an involuntary case under any law relating tobankruptcy, against the Borrower or such Subsidiary; or action under the laws of the jurisdiction of incorporation or organization of the Borrower or any of its Subsidiaries similar to any of the foregoing shall be taken with respect to the Borroweror such Subsidiary and shall continue unstayed and in effect for any period of thirty (30) days; or 

(j) there shall remain in force,undischarged and unsatisfied for more than sixty (60) days, whether or not consecutive, without a stay of execution, any judgment against any Borrower or any of its Subsidiaries that, with other outstanding final judgments, undischarged,against any Borrower or any of their Subsidiaries exceeds in the aggregate $250,000.00; or 

(k) the Borrower or any member of theControlled Group shall fail to pay when due an amount or amounts aggregating in excess of $250,000.00 that it shall have become liable to pay to the PBGC or to a Plan under Title IV of ERISA; or notice of intent to terminate a Plan or Plans shall befiled under Title IV of ERISA by the Borrower, any member of the Controlled Group, any plan administrator or any combination of the foregoing; or the PBGC shall institute proceedings under Title IV of ERISA to terminate or to cause a trustee to beappointed to administer any such Plan or Plans or a proceeding shall be instituted by a fiduciary of any such Plan or Plans against the Borrower and such proceedings shall not have been dismissed within thirty (30) days thereafter; or acondition shall exist by reason of which the PBGC would be entitled to obtain a decree adjudicating that any such Plan or Plans must be terminated; or 

(l) if any Loan Document is invalidated or declared null and void or otherwise ceases to be in full force and effect; or 

(m) if the proceeds of the Loan are used other than in accordance with the representations and covenants set forth in Section 4.11; or 

(n) if at any time the Lender’s security interest in the Collateral is impaired or invalidated or does not constitute a first priority perfectedsecurity interest, except for Permitted Exceptions; or 

(o) if any license, permit or qualification material to the business of theBorrower and its Subsidiaries, on a consolidated basis, is terminated, cancelled or invalidated; or 

(p) if the validity or enforceabilityof any Loan Document is contested by Borrower or if the Borrower denies liability thereunder; or 

(q) if the Borrower shall default in theobservance or performance of any other obligation owed to the Lender, other than the Obligations, and such default shall continue beyond the expiration of any applicable grace period therefore; or 

(r) any Change of Control shall have occurred; or 

(s) any “Event of Default”, as such term is defined in the Security Agreement, shall occur; or 

 

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(t) any “Event of Default”, as such term is defined under the documents governing the RevolvingFacility, shall occur. 

7.2 Remedies. Upon the occurrence of an Event of Default described in subsections 7.1(h) or (i), immediatelyand automatically, and upon the occurrence of any other Event of Default, at any time thereafter while such Event of Default is continuing, at the Lender’s option and upon the Lender’s declaration: 

(a) the unpaid principal amount of the Loan together with accrued interest and all other Obligations shall become immediately due and payable withoutpresentment, demand, protest or further notice of any kind, all of which are hereby expressly waived; and 

(b) the Lender may exercise anyand all rights it has under this Agreement, the Amended and Restated Note, the Security Agreement or any other documents or agreements executed in connection herewith, or at law or in equity, and proceed to protect and enforce the Lender’srights by any action at law, in equity or other appropriate proceeding. 

**SECTION VIII**

**MISCELLANEOUS**

8.1 Notices. Allnotices or other written communications hereunder shall be deemed to have been properly given (i) upon delivery, if delivered in person or by facsimile transmission with receipt acknowledged by the recipient thereof and confirmed by telephoneby sender, (ii) one (1) Business Day after having been deposited for overnight delivery with any reputable overnight courier service, or (iii) three (3) Business Days after having been deposited in any post office or maildepository regularly maintained by the U.S. Postal Service and sent by registered or certified mail, postage prepaid, return receipt requested, addressed as follows: 

 
If to Borrower:  Cybex International, Inc.  10 Trotter Drive  Medway, Massachusetts 11779  Attention: Chief Operating Officer  Facsimile No.: 507-455-8552With a copy to:  Archer & Greiner  One Centennial Square  Haddonfield, New Jersey  Attention: James H. Carll, Esq.  Facsimile No.: 856-519-0574If to Lender:  GMAC Commercial Finance LLC  600 Galleria Parkway, 15th Floor  Atlanta, Georgia 30339  Attention: Divisional Counsel  Facsimile No.: 678-324-2180
 

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With a copy to:  Thacher Proffitt & Wood LLP  50 Main Street, Suite 525  White Plains, New York 10606  Attention: Thomas J. Infurna, Esq.  Facsimile No.: 914-421-4150
or addressed as such party may from time to time designate by written notice to the other parties. 

Any party by notice to the others may designate additional or different addresses for subsequent notices or communications. 

8.2 Expenses. (a) The Borrower will pay on demand all expenses of the Lender in connection with the preparation, waiver or amendment of thisAgreement, the Amended and Restated Note, the Security Agreement, or other documents executed in connection therewith, or the administration, default or collection of the Loan or other Obligations or administration, default, collection in connectionwith the Lender’s exercise, preservation or enforcement of any of its rights, remedies or options thereunder, including, without limitation, fees of outside legal counsel or the allocated costs of in-house legal counsel, accounting, consulting,brokerage or other similar professional fees or expenses, and any fees or expenses associated with any travel or other costs relating to any appraisals or examinations conducted in connection with the Obligations or any collateral therefor, and theamount of all such expenses shall, until paid, bear interest at the rate applicable to principal under the Amended and Restated Note (including any default rate). 

(b) The Borrower has heretofore paid to the Lender an earnest money deposit of $70,000.00 (the “Deposit”). Such Deposit shall be applied to pay, or reimburse Lender for, Lender’s Expenses in connectionwith the transactions contemplated by this Agreement and the Loan Documents. At the expiration of the Credit Line Availability Period, an amount of the Deposit shall be returned to borrower determined in accordance with the following calculation:$70,000.00 minus the Expenses, multiplied by a fraction, the numerator of which shall equal the amount of all Credit Line Advances and the denominator of which shall equal $6,000,000.00. Notwithstanding the foregoing, if the total of all Credit LineAdvances borrowed shall exceed $6,000,000.00 as of the end of the Credit Line Availability Period, the entire remaining Deposit shall be promptly refunded to Borrower upon written request to Lender. 

8.3 Set-Off. Regardless of the adequacy of any collateral or other means of obtaining repayment of the Obligations, any deposits, balances orother sums credited by or due from the head office of the Lender or any of its branch offices to the Borrower may, at any time and from time to time after the occurrence of an Event of Default hereunder, without notice to the Borrower or compliancewith any other condition precedent now or hereafter imposed by statute, rule of law, or otherwise (all of which are hereby expressly waived) be set off, appropriated, and applied by the Lender against any and all obligations of the Borrower to theLender or any of its Affiliates in such manner as the head office of the Lender or any of its branch offices in their sole discretion may determine, and the Borrower hereby grants the Lender a continuing security interest in such deposits, balancesor other sums for the payment and performance of all such obligations. 

8.4 Term of Agreement. This Agreement shall continue in fullforce and effect so long the Loan or any Obligation shall be outstanding. 

 

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8.5 No Waivers. No failure or delay by the Lender in exercising any right, power or privilegehereunder or under the Amended and Restated Note, the Security Agreement and the other Loan Documents or under any other documents or agreements executed in connection herewith shall operate as a waiver thereof; nor shall any single or partialexercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein, in the Amended and Restated Note, the Security Agreement and the other Loan Documents providedare cumulative and not exclusive of any rights or remedies otherwise provided by agreement or law. 

8.6 **Governing Law; Consent toJurisdiction. THIS AGREEMENT AND, EXCEPT TO THE EXTENT PROVIDED THEREIN, THE OTHER LOAN DOCUMENTS, SHALL BE GOVERNED AND CONTROLLED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO ANY CONFLICTS OF LAWS PROVISIONSCONTAINED THEREIN) AS TO INTERPRETATION, ENFORCEMENT, VALIDITY, CONSTRUCTION, EFFECT, AND IN ALL OTHER RESPECTS. TO INDUCE LENDER TO ENTER INTO THIS AGREEMENT, BORROWER IRREVOCABLY AGREES THAT, AT LENDER’S SOLE AND ABSOLUTE ELECTION, ALL LEGALAND OTHER PROCEEDINGS OF ANY KIND ARISING OUT OF OR RELATED TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE LITIGATED IN COURTS HAVING SITUS IN THE CITY OF NEW YORK, IN THE STATE OF NEW YORK. BORROWER HEREBY CONSENTS AND SUBMITS TO THEJURISDICTION OF ANY LOCAL, STATE OR FEDERAL COURTS LOCATED WITHIN SAID CITY AND STATE. BORROWER HEREBY WAIVES ANY RIGHT IT MAY HAVE TO TRANSFER OR CHANGE THE VENUE OF ANY LEGAL OR OTHER PROCEEDING BROUGHT AGAINST SUCH PERSON BY LENDER IN ACCORDANCEWITH THIS SECTION.**

8.7 Indemnity. The Borrower will (i) indemnify and hold harmless the Lender and each of its officers,directors, employees, Affiliates, agents and controlling persons (each an “Indemnified Party”) from and against any and all losses, claims, damages and liabilities to which any such Indemnified Party may become subject arising out of or inconnection with any claim, litigation, investigation or proceeding relating to the Loan (including the use of the proceeds thereof), the Loan Documents, or any related transaction, whether or not any Indemnified Party is a party thereto, and(ii) reimburse each Indemnified Party upon demand for all legal and other expenses incurred in connection with investigating or defending any of the foregoing, except, in each case, losses, claims, damages, liabilities or related expenses tothe extent arising from the willful misconduct or gross negligence or the applicable Indemnified Party. 

8.8 Amendments. Neitherthis Agreement, the Amended and Restated Note, the Security Agreement, any other Loan Documents, nor any provision hereof or thereof may be amended, waived, discharged or terminated except by a written instrument signed by the Lender and, in thecase of amendments, by the Borrower. 

8.9 Binding Effect of Agreement. This Agreement shall be binding upon and inure to the benefitof the Borrower and the Lender and their respective successors and assigns; provided that the Borrower may not assign or transfer its rights or obligations hereunder. The Lender may sell, transfer or grant participations in this Agreement, theAmended and Restated Note, the Security Agreement and the other Loan Documents without the prior written consent of the Borrower. 

 

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8.10 Counterparts. This Agreement may be signed in any number of counterparts with the same effectas if the signatures hereto and thereto were upon the same instrument. 

8.11 Partial Invalidity. The invalidity or unenforceabilityof any one or more phrases, clauses or sections of this Agreement shall not affect the validity or enforceability of the remaining portions of it. 

8.12 Captions. The captions and headings of the various sections and subsections of this Agreement are provided for convenience only and shall not be construed to modify the meaning of such sections or subsections. 

8.13 **WAIVER OF JURY TRIAL. THE LENDER AND THE BORROWER AGREE THAT NEITHER OF THEM NOR ANY ASSIGNEE OR SUCCESSOR SHALL (A) SEEK A JURYTRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM OR ANY OTHER ACTION BASED UPON, OR ARISING OUT OF, THIS AGREEMENT, ANY RELATED INSTRUMENTS, ANY COLLATERAL OR THE DEALINGS OR THE RELATIONSHIP BETWEEN OR AMONG ANY OF THEM, OR (B) SEEK TOCONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY DISCUSSED BY THE LENDER AND THE BORROWER, AND THESE PROVISIONS SHALL BE SUBJECT TO NOEXCEPTIONS. NEITHER THE LENDER NOR THE BORROWER HAS AGREED WITH OR REPRESENTED TO THE OTHER THAT THE PROVISIONS OF THIS PARAGRAPH WILL NOT BE FULLY ENFORCED IN ALL INSTANCES.**

8.14 Waiver of Counterclaim. Borrower hereby waives the right to assert a counterclaim, other than a mandatory or compulsory counterclaim, in anyaction or proceeding brought against it by Lender arising out of or in any way connected with this Agreement, the Amended and Restated Note, the Security Agreement, any other Loan Documents or the Obligations. 

8.15 Entire Agreement. This Agreement, the Amended and Restated Note, the Security Agreement, and the other Loan Documents constitute the finalagreement of the parties hereto and supersede any prior agreement or understanding, written or oral, with respect to the matters contained herein and therein. 

8.16 Liability. If Borrower consists of more than one person, the obligations and liabilities of each such person hereunder shall be joint and several. 

8.17 Amendment and Restatement. Borrower and Lender each expressly acknowledge and agree that this Agreement amends, restates, replaces andsupersedes the Original Credit Agreement in its entirety as of the Date hereof. To the extent terms and provisions of this Agreement conflict with the terms and provisions of the Original Credit Agreement, the terms and provisions of this Agreementshall control. 

 

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**[SIGNATURE PAGE FOLLOWS]**

 

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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their duly authorizedofficers as of the day and year first above written. 

 

CYBEX INTERNATIONAL, INC.
By: 
/s/ Arthur W. Hicks, Jr.
Name: Arthur W. Hicks, Jr.Title: Vice President, Chief Operating Officer
**[SIGNATURE PAGE CONTINUES]**

GMAC COMMERCIAL FINANCE LLCBy: 
/s/ David W. Berry
Name: David W. BerryTitle: Vice President