EXHIBIT
10.1

     

    AMENDED AND RESTATED CREDIT
FACILITY AGREEMENT

     

    This
AMENDED AND RESTATED CREDIT FACILITY AGREEMENT (“Agreement”) is made as of
December 16, 2009 by and among IEC ELECTRONICS CORP., a corporation formed under
the laws of the State of Delaware (“Borrower”) and MANUFACTURERS
AND TRADERS TRUST COMPANY (“Lender”), a New York banking
corporation, with offices at 255 East Avenue, Rochester, New York
14604.  This Agreement evidences in part obligations evidenced by, and
amends and restates in its entirety, the Credit Facility Agreement dated May 30,
2008, as amended, made between the Borrower and Lender (“Prior
Agreement”).  All references to the Prior Agreement in any Loan
Document made or delivered in connection with the Prior Agreement shall be
deemed to be references to the Prior Agreement as amended and restated by this
Agreement.

     

    ARTICLE 1
- DEFINITIONS

     

    1.1           Definitions.  The
following terms shall have the following meanings unless otherwise expressly
stated herein:

     

    “2008 Term Loan” means the
$1,700,000 aggregate original outstanding principal balance term loan described
in Article 3 hereof.

     

    “2008 Term Loan Maturity Date”
means May 30, 2013.

     

    “2008 Term Loan Note” means
the Amended and Restated Term Loan Note described in Section 3.2.

     

    “Affiliate” means any Person
which directly or indirectly, or through one or more intermediaries, Controls or
is Controlled By or is Under Common Control with Borrower; provided, however,
that the neither Lender, nor any its Affiliate, shall be considered an Affiliate
of any Credit Party.

     

    “Agreement” means this Amended
and Restated Credit Facility Agreement.

     

    “Applicable Margin” means,
with respect to the applicable facility, the per annum percentage points shown
in the applicable column of the table below based on the applicable Debt to
EBITDARS Ratio, calculated for Borrower on a consolidated basis and without
duplication in accordance with GAAP:

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    	
                                            Level

                                          	 	
                                            Debt to EBITDARS

                                          	 	
                                            Revolving Line

                                            Facility*

                                          	 	
                                            Other Facilities

                                          
	 	 	 	 	 	 	 
	
                                            I

                                          	 	
                                            ≥
      3.25 to 1

                                          	 	
                                            3.50%

                                          	 	
                                            3.75%

                                          
	 	 	 	 	 	 	 
	
                                            II

                                          	 	
                                            ≥
      2.75 to 1 and < 3.25 to 1

                                          	 	
                                            3.25%

                                          	 	
                                            3.50%

                                          
	 	 	 	 	 	 	 
	
                                            III

                                          	 	
                                            ≥
      2.25 to 1 and < 2.75 to 1

                                          	 	
                                            3.00%

                                          	 	
                                            3.25%

                                          
	 	 	 	 	 	 	 
	
                                            IV

                                          	 	
                                            ≥
      1.75 to 1 and < 2.25 to 1

                                          	 	
                                            2.75%

                                          	 	
                                            3.00%

                                          
	 	 	 	 	 	 	 
	
                                            V

                                          	 	
                                            <
      1.75 to 1

                                          	 	
                                            2.25%

                                          	 	
                                            2.50%

                                          


                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

    
       

      
        	
              	
                *

              	
                For
      amounts outstanding as an Overline Advance, the Applicable Margin will be
      the applicable level shown in the above table plus
  0.50%.

              


      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

     

    The
Applicable Margin shall be fixed at Level III on the date of this
Agreement.  Effective on the tenth (10th) day following the date on
which the Borrower’s QCC Sheet is required to be delivered to the Lender
pursuant to Section 13.5 for the period ended June 30, 2010, the Applicable
Margin will be adjusted based upon the Debt to EBITDARS ratio shown
therein.  Thereafter, changes, if any, in the Level applicable to
Loans will be effective on the tenth (10th) day following each date on which the
Borrower’s QCC Sheet is required to be delivered to the Lender pursuant to
Section 13.5, based upon the Debt to EBITDARS ratio shown therein.  In
the event that any QCC Sheet is not delivered by the date required, pricing will
revert to Level I until the tenth (10th) day following the date of delivery of
the delayed QCC Sheet, on which tenth day pricing will be adjusted to the
applicable level shown by the QCC Sheet.  Upon the occurrence of a
Default or Event of Default, the Applicable Margin shall immediately be adjusted
to Level I and no reduction shall occur thereafter unless the Default or Event
of Default is waived in writing by the Lender.

     

    “Applicable Unused Fee” means
the per annum rate (calculated based upon days elapsed over a 360 day year)
shown in the table below based on the applicable Debt to EBITDARS Ratio,
calculated for Borrower on a consolidated basis and without duplication in
accordance with GAAP:

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              	
                                      Level

                                    	 	
                                      Debt to EBITDARS

                                    	 	
                                      Unused Fee

                                    
	 	 	 	 	 
	
                                      I

                                    	 	
                                      ≥
      3.25 to 1

                                    	 	
                                      0.500%

                                    
	 	 	 	 	 
	
                                      II

                                    	 	
                                      ≥
      2.75 to 1 and < 3.25 to 1

                                    	 	
                                      0.375%

                                    
	 	 	 	 	 
	
                                      III

                                    	 	
                                      ≥
      2.25 to 1 and < 2.75 to 1

                                    	 	
                                      0.250%

                                    
	 	 	 	 	 
	
                                      IV

                                    	 	
                                      ≥
      1.75 to 1 and < 2.25 to 1

                                    	 	
                                      0.250%

                                    
	 	 	 	 	 
	
                                      V

                                    	 	
                                      <
      1.75 to 1

                                    	 	
                                      0.125%

                                    


                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    The
Applicable Unused Fee shall be fixed at Level III on the date of this
Agreement.  Effective on the tenth (10th) day following the date on
which the Borrower’s QCC Sheet is required to be delivered to the Lender
pursuant to Section 13.5 for the period ended June 30, 2010, the Unused Fee will
be adjusted based upon the Debt to EBITDARS ratio shown
therein.  Thereafter, changes, if any, in the Level applicable will be
effective on the tenth (10th) day following each date on which the Borrower’s
QCC Sheet is required to be delivered to the Lender pursuant to Section 13.5,
based upon the Debt to EBITDARS ratio shown therein.  In the event
that any QCC Sheet is not delivered by the date required, the unused fee will
revert to Level I until the tenth (10th) day following the date of delivery of
the delayed QCC Sheet, on which tenth day the unused fee will be adjusted to the
applicable level shown by the QCC Sheet.  Upon the occurrence of a
Default or Event of Default, the unused fee shall immediately be adjusted to
Level I and no reduction shall occur thereafter unless the Default or Event of
Default is waived in writing by the Lender.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    “Asset Disposition” means any
sale, assignment, transfer, lease, or other disposition by a Person to any other
Person, whether in one transaction or in a series of related transactions, of
any of its assets, business units or other properties (including (i) any
interest in property, whether tangible or intangible, (ii) Capital Securities of
Subsidiaries, and (iii) any sale-leaseback transaction), provided, however, that
“Asset Disposition” shall not include (a) the sale of inventory in the ordinary
course of business, and (b) the disposition of any obsolete or retired property
not used or useful in the business of any of the Credit Parties in return for a
fair market value.

     

    “Automatic Adjustment Rate
Determination Date” means, with respect to LIBOR Loans other than Daily
LIBOR Loans, two (2) LIBOR Business Days before the first day of the applicable
Interest Period.

     

    “Automatic Continuation
Option” shall, with respect to any LIBOR Loan, mean the option to have
the then-current Interest Period duration, as previously selected by Borrower,
remain the same for the succeeding Interest Period.

     

    “Base Rate” means the higher
of (i) the Prime Rate, and (ii) the Federal Funds Rate plus one-half percentage
point (.5%), but in no case less than a floor Base Rate of one and one-fourth
percent (1.25%), plus the Applicable Margin.

     

    “Base Rate Loan” means any
Loan when and to the extent that the interest rate for such Loan is determined
by reference to the Base Rate.

     

    “BOA Mortgage” means the
Mortgage made by GTC in favor of NationsBank, N.A. dated March 1, 1999 and
recorded April 1, 1999 in Book 9905, Page 3972, records of Bernalillo County,
New Mexico (the “BOA
Mortgage”).

     

    “Borrower” means IEC
Electronics Corp. and its successors, legal representatives and
assigns.

     

    “Borrowing Base” means the sum
of the following:

     

    (a)           85%
of the Eligible Accounts of the Credit Parties; plus

     

    (b)           35%
of the Eligible Inventories of the Credit Parties up to a maximum of $3,000,000,
or if the Inventory Overline Advance Rate has been elected pursuant to Section
2.2, 70% of the Borrower’s Eligible Inventories up to a maximum of
$4,000,000.

     

    “Borrowing Base Report” means
a report described in Section 11.1 of this Agreement.

     

    “Breakage Costs” means amounts
covered by Section 8.7.

     

    
      
        
        

      

      
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    “Business Day” means any day
other than a Saturday, Sunday, or other day on which commercial banking
institutions in New York, New York are authorized or required by law or other
governmental action to remain closed for business.

     

    “Capital Security” means, (a)
with respect to any Person that is a corporation, any and all shares, interests
or equivalents in capital stock (without limitation whether voting or nonvoting,
and whether common or preferred) of such corporation, and (b) with respect to
any Person that is not a corporation, any and all partnership, membership,
limited liability company or other equity interests of such Person; and (c) in
each case, any and all warrants, rights or options to purchase any of the
foregoing with respect to any Person, any security convertible into any of the
foregoing, participations, and any other equity interests or equity equivalents,
including stock appreciation rights or phantom stock, with respect to such
Person.

     

    “Casualty Event” means, with
respect to any property (including any interest in property) of any Credit
Party, any loss of, theft of, damage to, or condemnation or other taking of,
such property for which any of the Credit Parties receives insurance proceeds,
proceeds of a condemnation award, or other compensation, which proceeds are not
used to replace or restore such property.

     

    “Change in Control” means the
acquisition of ownership, directly or indirectly, beneficially or of record, by
any person or group (within the meaning of Section 13(d)(3) of the Securities
Exchange Act of 1934 and the rules of the Securities and Exchange Commission
thereunder as in effect on the date hereof), of shares representing more than
twenty-five percent (25%) of the aggregate ordinary voting power in the election
of Borrower’s directors represented by the issued and outstanding capital stock
of Borrower.

     

    “Closing Date” means the date
of this Agreement.

     

    “Commitment” means the
Revolving Line Commitment and the Equipment Line Commitment.

     

    “Continuation Date” means the
date that Borrower’s election to continue a LIBOR Loan for another Interest
Period becomes effective in accordance with this Agreement.

     

    “Controls” (including the
terms “Controlled By”
or “Under Common
Control”) means, but not be limited to, the ownership of ten percent
(10%) or more of the outstanding shares of capital stock of any corporation
having voting power for the election of directors, whether or not at the same
time stock of any other class or classes has or might have voting power by
reason of the happening of any contingency, or ownership of ten percent (10%) or
more of any interest in any Person or any other interest by reason of which a
controlling influence over the affairs of the Person may be
exercised.

     

    “Copyright Security
Agreements” means the Copyright Security Agreement listed on Schedule 1.1(A), and any similar
document delivered by any Credit Party, and, as amended, modified or restated
from time to time.

     

    “Credit Party(ies)” means the
Borrower and each Guarantor.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    “Current Assets” means as of
the date of measurement current assets of the applicable Person on a
consolidated basis determined in accordance with GAAP.

     

    “Current Liabilities” means
all liabilities of the applicable Person treated as current liabilities in
accordance with GAAP, including all obligations payable on demand or within one
year after the applicable measurement date as well as installment,
reimbursement, or sinking fund payments payable within one year after the
applicable measurement date.  Current Liabilities shall include
outstanding principal amounts under the Revolving Credit Facility.

     

    “Daily LIBOR Loan” means a
LIBOR Loan with respect to which the rate is adjusted and determined
daily.

     

    “Debt” means, as of the
measurement date, without duplication, on a consolidated basis, Borrower’s and
its Subsidiaries’:

     

    (a)           indebtedness
or liability for borrowed money, including without limitation Obligations under
the Loan Documents, IECW&C Subordinated Debt, the M&T Sale-Leaseback,
synthetic leases and any other off-balance sheet financing (but except for the
M&T Sale-Leaseback not including true operating leases);

     

    (b)           obligations
evidenced by bonds, debentures, notes, or other similar
instruments;

     

    (c)           obligations
for the deferred purchase price of property or services (excluding current
accounts payable incurred in the ordinary course of business);

     

    (d)           obligations
as lessee under capital leases;

     

    (e)           current
liabilities in respect of unfunded vested benefits under Plans covered by
ERISA;

     

    (f)       
    obligations as an account party under letters of credit
and letters of guaranty;

     

    (g)           obligations
under acceptance facilities;

     

    (h)           all
guaranties, endorsements (other than for collection or deposit in the ordinary
course of business), and other contingent obligations to purchase, to provide
funds for payment, to supply funds to invest in any Person, or otherwise to
assure a creditor against loss, including Debt of any other Person (including
any partnership in which such Person is a general partner) to the extent such
person is liable therefor as a result of such Person’s ownership interest in or
other relationship with such Person;

     

    (i)      
     obligations secured by (or for which the holder of
the obligations has an existing right, contingent or otherwise to be secured by)
any Liens on property owned or acquired, whether or not the obligations secured
thereby have been assumed;

     

    
      
        
        

      

      
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    (j)       
    all purchase money mortgages, and obligations under
asset securitization vehicles, conditional sales contracts and similar title
retention debt instruments; and

     

    (k)           obligations
of a Person to purchase securities or other property that arise out of or in
connection with the sale of the same or substantially similar securities or
property, such as Capital Securities that are subject to mandatory redemption
requirements.

     

    “Debt to EBITDARS Ratio” means
as of the applicable measurement date, the Debt as of such date divided by
EBITDARS for the twelve (12) Fiscal Month period ended as of such
date.

     

    “Default” means any event,
action, inaction, occurrence or condition that with notice or passage of time,
or both, would constitute an Event of Default.

     

    “Default Rate” means, (i) in
the case of LIBOR Loans and Base Rate Loans, three (3) percentage points above
the LIBOR Rate or the Base Rate, respectively, and (ii) with respect to other
Obligations, three (3) percentage points above the interest rate otherwise in
effect.

     

    “Distributions” means (i)
dividends, payments, or distributions of any kind (including without limitation
cash or property or the setting aside for payment of either) in respect of
Capital Securities of the applicable Person except distributions in the form of
such Capital Securities, and (ii) repurchases, redemptions, or acquisitions of
Capital Securities.

     

    “Draw Date” means in relation
to each Loan, the date that such Loan is made or deemed to be made to Borrower
pursuant to this Agreement.

     

    “EBITDA” means, for the
applicable period, Net Income plus interest expense, cash Taxes paid,
depreciation and amortization of intangible assets, all on a consolidated basis
and determined in accordance with GAAP on a consistent basis.

     

    “EBITDARS” means, for the
applicable period, EBITDA, plus payments due under the M&T Sale-Leaseback
and non-cash stock option expense, all on a consolidated basis and determined in
accordance with GAAP on a consistent basis.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    “Eligible Accounts” means and
includes only accounts receivable of a Credit Party (“Accounts”), the records and
accounts of which are located in all places at which Borrower maintains, or will
maintain, records relating to the Accounts, are acceptable to Lender in Lender’s
reasonable discretion, arise out of sales in the ordinary course of the business
of a Credit Party made by a Credit Party to a Person which is not an Affiliate
nor an employee of a Credit Party nor controlled by an Affiliate, which are not
in dispute and which do not then violate any warranty with respect to Accounts
set forth in any security agreement made by any Credit Party in favor of Lender
(“Lender Security
Agreement”).  No Account shall be an Eligible Receivable if
more than 90 days have passed since the original invoice date and the inventory
covered by such Account was shipped to the customer on or prior to the invoice
date, or the services described in such invoice were provided on or prior to the
invoice date.  Accounts must not be owing by an Account debtor or a
group of affiliated Account debtors whose then existing Accounts owing to the
Credit Parties individually exceed in aggregate face amount twenty percent
(20)%) of the Credit Parties’ total Eligible Receivables and are not owing by an
Account debtor or a group of affiliated Account debtors whose then existing
Accounts to any or all of the Credit Parties collectively exceed in aggregate
face amount twenty percent (20%) of the total Eligible Receivables of all the
Credit Parties; provided that the Lender may from time to time, in the exercise
of its sole and absolute discretion, consent to a higher concentration limit and
provided further that any such Account shall be a non-Eligible Receivable only
to the extent of such excess.  Lender may treat any Account as
ineligible if: (a) any warranty contained in this Agreement or in any Lender
Security Agreement with respect to Accounts has been breached; or (b) the
Account debtor or any affiliate of the Account debtor has disputed the
liability, or made any claim with respect to such Account or with respect to any
other Account due from such customer or account debtor to any Credit Party;
provided, however, only such portion of the Account which is disputed or subject
to a claim shall be treated as ineligible unless Lender reasonably determines in
its discretion that there is a material risk of nonpayment (or Lender is unable
to assess the risk of nonpayment) of the entire Account or any other Account
pending resolution of such dispute or claim, in which case Lender may treat the
entire Account or such other Account as ineligible; or (c) the Account debtor or
an affiliate of the Account debtor has filed a case for bankruptcy or
reorganization under the Bankruptcy Code, or if any case under the Bankruptcy
Code has been filed against the Account debtor or any affiliate of the Account
debtor, or if the Account debtor or any Affiliate of the account debtor has
assigned for the benefit of creditors, or if the Account debtor or any affiliate
of the Account debtor has failed, suspended business operations, become
insolvent, or had or suffered a receiver or a trustee to be appointed for all or
a significant portion of its assets or affairs; or (d) if the Account debtor is
also a supplier to or creditor of a Credit Party or if the Account debtor has or
asserts any right of offset with respect to any Account or asserts any claim or
counterclaim against any Credit Party with respect to any Account or otherwise
(the Accounts due from the Account debtor will only be reduced to the extent of
the claim or counter claim); or (e) the sale is to an Account debtor outside the
United States or Canada, unless the sale is on letter of credit, acceptance or
other terms acceptable to Lender; or (f) 50% or more of the Accounts of any
Account debtor and its affiliates is ineligible, then all the Accounts of such
Account debtor and its affiliates may be deemed ineligible by Lender; (g) it
relates to a sale of goods or services to the United States, or any agency or
department thereof, unless the applicable Credit Party assigns its right to
payment of such Account to Lender in form and substance satisfactory to Lender,
so as to comply with the Assignment of Claims Act of 1940, as amended; or (h) it
relates to sale of goods or services to a state or local governmental authority
or an agency or department thereof; or (i) it relates to intercompany sales,
employee sales or is due from an Affiliate; or (j) it consists of a sale to an
Account debtor on consignment, bill and hold, guaranteed sale, sale or return,
sale on approval, payment plan, scheduled installment plan, extended payment
terms or any other repurchase or return basis; or (k) the Account debtor is
located in a state in which the applicable Credit Party is deemed to be doing
business under the laws of such state and which denies creditors access to its
courts in the absence of qualification to transact business in such state or of
the filing of any reports with such state, unless the applicable Credit Party
has qualified as a foreign corporation authorized to do business in such state
or has filed all required reports; or (l) the Account is evidenced by chattel
paper or an instrument of any kind, or has been reduced to judgment; or (m) the
Account arises from a sale of goods or services to an individual who is
purchasing such goods primarily for personal, family or household purposes; or
(n) if Lender believes, in its reasonable discretion, that collection of such
Account is insecure or that such Account may not be paid by reason of the
Account debtor’s financial inability to pay (should availability under the
Revolving Line Facility be an issue, the Lender will allow the Borrower thirty
(30) days prior to the removal from the Borrowing Base, provided that the
Accounts from such Account debtor do not collectively exceed ten percent (10%)
of the total Eligible Receivables).

     

    
      
        
        

      

      
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    “Eligible Inventories” means
inventory owned by a Credit Party (“Inventory”) which has been
identified and described to the Lender’s reasonable satisfaction, and is
represented by the Borrower as meeting all of the following criteria on the date
any Revolving Credit Loan based thereon is outstanding:  (a) a Credit
Party is the sole owner of the Inventory, none of the Inventory is being held or
shipped by such Credit Party on a consignment or approval basis, such Credit
Party has not sold, assigned or otherwise transferred all or any portion
thereof, and none of the Inventory is subject to any claim, lien, or security
interest other than in favor of Lender; (b) if any of the Inventory is
represented or covered by any document of title, instrument or chattel paper, a
Credit Party is the sole owner of all such documents, instruments, and chattel
paper, all of which are in the possession of such Credit Party, none thereof has
been sold, assigned, or otherwise transferred, and none thereof is subject to
any claim, lien or security interest other than in favor of Lender; and (c) the
Inventory consists of saleable non-obsolete, commodity type raw materials that
are earmarked for specific orders and is not excess as shown on the Borrower’s
Excess Stock Report or determined by the Lender’s collateral audits, and
finished goods manufactured or acquired by a Credit Party in the ordinary course
of such Credit Party’s business, as conducted on the date hereof, subject to its
contract or sole possession and located in places where Credit Parties maintain,
or will maintain, Inventory, and at locations for which landlord or bailee
waivers in form and substance acceptable to Lender have been executed and
delivered by such landlord or bailee to Lender; and any Inventory which the
Lender in the good faith exercise of its sole discretion from time to time has
deemed to be ineligible because the Lender otherwise considers the collateral
value to the Lender to be impaired or its ability to realize such value to be
insecure.

     

    “Energy Loan” means the term
loan made by the Lender to fund energy-related expenditures, referenced in
Article 4 hereof.

     

    “Energy Loan Maturity Date”
means April 2, 2013.

     

    “Energy Loan Note” means the
Energy Loan Note evidencing the Energy Loan, as such note may be amended,
modified or restated from time to time.

     

    “Environment” means any water,
including, but not limited to, surface water and ground water or water vapor:
any land, including land surface or subsurface; stream sediments; air; fish;
wildlife; plants; and all other natural resources or environmental
media.

     

    “Environmental Laws” means all
present and future federal, state and local environmental, land use, zoning,
health, chemical use, safety and sanitation laws, statutes, ordinances,
regulations, codes and rules relating to the protection of the Environment
and/or governing the use, storage, treatment, generation, transportation,
processing, handling, production or disposal of Hazardous Substances and the
regulations, rules, ordinances, bylaws, policies, guidelines, procedures,
interpretations, decisions, orders and directives of federal, state and local
governmental agencies and authorities with respect thereto.

     

    
      
        
        

      

      
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    “Environmental Permits” means
all licenses, permits, approvals, authorizations, consents or registrations
required by any applicable Environmental Laws and all applicable judicial and
administrative orders in connection with ownership, lease, purchase, transfer,
closure, use and/or operation of the Improvements and/or as may be required for
the storage, treatment, generation, transportation, processing, handling,
production or disposal of Hazardous Substances.

     

    “Environmental Report” means
written reports, if any, prepared for the Lender by an environmental consulting
or environmental engineering firm.

     

    “Equipment Line Commitment”
means the discretionary commitment related to the Equipment Line described in
Section 5.1.

     

    “Equipment Line Facility”
means the equipment line facility established pursuant to Section 5.1 of this
Agreement.

     

    “Equipment Line Loan(s)” means
a loan or loans made by the Lender to Borrower under the Equipment Line
Facility.

     

    “Equipment Line Maturity Date”
means December 16, 2010, or such later date as may be agreed by the Bank in its
sole discretion in writing.

     

    “Equipment Line Notes” means
the Equipment Line Notes made from time to time by Borrower in favor of Lender
pursuant to Section 5.4 of this Agreement, as such notes may be amended,
modified or restated from time to time.

     

    “ERISA” means the Employee
Retirement Income Security Act of 1974, as amended.

     

    “ERISA Affiliate” means any
trade or business (whether incorporated or unincorporated) which together with
the Borrower is treated as a single employer under Section 414(b), (c), (m) or
(o) of the Internal Revenue Code.

     

    “Event of Default” means the
occurrence of any event described in Section 15.1.

     

    “Excess Cash Flow” means, for
the applicable period, the sum of:

     

    (a)           EBITDA,
minus

     

    (b)           Taxes
based upon income to the extent that such Taxes are paid in cash, minus

     

    (c)           Interest
Expense to the extent such Interest Expense is paid in cash during such period
or within fifteen (15) days after the end of such period, minus

     

    (d)           all
principal payments (whether scheduled, voluntary prepayments, or mandatory
prepayments) of Debt other than Revolving Credit Loans, minus

     

    (e)           all
Unfinanced Capital Expenditures, minus

     

    
      
        
        

      

      
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    (f)           any
losses or expenses (or gains or income) which are cash items and were added back
for the purpose of determining EBITDA, minus (or
plus)

     

    (h)           plus
non-cash stock compensation expense.

     

    “Federal Funds Rate” means,
for any period, a fluctuating interest rate per annum equal for each day during
such period determined by the Lender to equal the weighted average of the rates
on overnight federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers, as published for such day (or if such
day is not a Business Day, for the next preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day which
is a Business Day, the average of the quotations at approximately 10:00 a.m. for
such day on such transactions received by the Lender from three Federal funds
brokers of recognized standing selected by it.

     

    “Financial Statements” means
Borrower’s audited consolidated financial statements described in Section
9.6.

     

    “Fiscal Month” means a period
that constitutes Borrower’s monthly accounting period.

     

    “Fiscal Quarter” means any of
the quarterly accounting periods of Borrower ending on December 31, March 31,
June 30, and September 30 of any Fiscal Year.

     

    “Fiscal Year” means the annual
accounting period of Borrower ending on September 30 of each year.

     

    “Fixed Charge Coverage Ratio”
means, as of the applicable measurement date, the ratio of (i) EBITDA, plus
non-cash stock option expense, minus Unfinanced Capital Expenditures, minus cash
Taxes paid for the four Fiscal Quarters just ended, to (ii) the sum of Interest
Expense, plus principal payments due or paid with respect to Debt, plus
Distributions during the four Fiscal Quarters just ended.

     

    “Fixed Rate” means, with
respect to any particular Loan, the Cost of Funds for five years, or such
shorter period matching any shorter original length to maturity of any loan made
under the Equipment Line Facility (the “Base Term”), plus three
percentage points (3%), but not less than a floor Fixed Rate of six percent (6%)
per annum.  “Cost of
Funds’ means the most recent yield on United States Treasury Obligations
adjusted to a constant maturity to match the Base Term in effect two (2)
Business Days prior to the date on which the Fixed Rate will first be applicable
to the respective Loan, as published by the Board of Governors of the Federal
Reserve System in the Federal Reserve Statistical Release H.15(519), or by such
other quoting service, index, or commonly available source utilized by the
Lender, plus the “ask” side of the like term swap spread.

     

    “Fixed Rate Loan” means any
Loan when and to the extent that the interest rate for such Loan is determined
by reference to a Fixed Rate.

     

    “Fixed Rate Period” means the
period selected by the Borrower during which a particular Fixed Rate shall be
applicable.

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    “Forfeiture Action” means any
action, including investigations, hearings, and other legal proceedings, before
any court, tribunal, commission, or governmental authority, agency, or
instrumentality, whether domestic or foreign, that may result in seizure of any
property or asset.

     

    “GAAP” and “Generally Accepted Accounting
Principles” means generally accepted accounting principles set forth in
the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as may be approved by a significant segment of
the accounting profession in the United States of America, which are applicable
to the circumstances as of the date of determination.

     

    “GTC” means General Technology
Corporation.

     

    “GTC Term Loan” means the
$5,000,000 aggregate original outstanding principal balance term loan described
in Article 6 hereof.

     

    “GTC Term Loan Maturity Date”
means December 16, 2014.

     

    “GTC Term Loan Note” means the
Term Loan Note evidencing the GTC Term Loan

     

    “GTC Transaction” means the
acquisition by Borrower of the Capital Securities of GTC pursuant to the Stock
Purchase Agreement, dated as of December 16, 2009, made among Borrower, Crane
International Holdings, Inc., and GTC.

     

    “Guarantor(s)” means
IECW&C, GTC, and each Subsidiary which becomes a Guarantor pursuant to
Section 11.12.

     

    “Guaranties” means,
collectively, the continuing guaranties executed and delivered to Lender by each
Guarantor which guaranty payment of the Obligations, as amended, modified or
restated from time to time, and “Guaranty” means any of the
Guaranties.

     

    “Hazardous Substances” means,
without limitation, any explosives, radon, radioactive materials, asbestos, urea
formaldehyde foam insulation, polychlorinated biphenyls, petroleum and petroleum
products, methane, hazardous materials, hazardous wastes, hazardous or toxic
substances and any other material defined as a hazardous substance in any
Environmental Laws, including the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended, 42 U.S.C. Sections 9601, et.
seq.; the Hazardous Materials Transportation Act, as amended, 49 U.S.C. Sections
1801, et. seq.; the Resource Conservation and Recovery Act, as amended, 42
U.S.C. Sections 6901, et. seq.; Articles 15 and 27 of the New York State
Environmental Conservation Law or any other federal, state, or local law,
regulation, rule, ordinance, by-law, policy, guideline, procedure,
interpretation, decision, order, or directive, whether existing as of the date
hereof, previously enforced or subsequently enacted.

     

    “IECW&C” means IEC
Electronics Wire and Cable, Inc., formerly known as Val-U-Tech,
Inc.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    “IECW&C Subordinated Debt”
means Debt incurred to the Shareholder of IECW&C in connection with the
closing of the acquisition by the Borrower of the stock of Val-U-Tech Corp.
pursuant to the Agreement and Plan of Merger among Borrower, VUT Merger Corp.,
Val-U-Tech, Inc. and the Shareholders of Val-U-Tech, Inc. dated May 23,
2008.

     

    “Improvements” means any and
all real property and improvements owned or used by any of the Credit
Parties.

     

    “Intellectual Property” means
the property described in Section 9.13.

     

    “Interest Expense” means, for
the applicable period, all interest paid, capitalized, or accrued, and
amortization of debt discount with respect to all Debt determined after giving
effect to the net cost associated with Rate Management
Transactions.

     

    “Interest Period” means, (i)
with respect to any LIBOR Loan other than a Daily LIBOR Loan, the period
commencing on the Draw Date or Continuation Date for such LIBOR Loan and ending
on the date that shall be the numerically corresponding day (or, if there is no
numerically corresponding day, on the last day) of the calendar month that is
one (1), two (2), three (3) or six (6) months after the commencement of such
period, in accordance with Borrower’s election made pursuant to the terms of
this Agreement; provided, however, that if an Interest Period would end on a day
that is not a LIBOR Business Day, such Interest Period shall be extended to the
next succeeding LIBOR Business Day, unless such next succeeding LIBOR Business
Day would fall in the next calendar month, in which case such Interest Period
shall end on the immediately preceding LIBOR Business Day, and (ii) with respect
to a Daily LIBOR Loan, one day, provided, however, that if an Interest Period
would end on a day that is not a LIBOR Business Day, such Interest Period shall
be extended to the next succeeding LIBOR Business Day.

     

    “Inventory Overline Advance
Rate” means 70% of Borrower’s Eligible Inventory.

     

    “Investment” of any Person
means (a) acquisition of any Capital Security, evidence of Debt or other
security or instrument issued by any other Person, (b) any loan, advance or
extension of credit to (including guaranties of liabilities of), or any
contribution to the capital of, any other Person, (c) any acquisition of assets
(other than inventory or Capital Expenditures in the ordinary course of
business) or business from or Capital Security of any other Person, (d)
acquisition of a futures contract, or becoming liable for the purchase or sale
of currency or other commodities at a future date in the nature of a futures
contract, and (e) any other investment in any other Person.  An
Investment shall be deemed to be “outstanding”, except to the extent that it has
been paid or otherwise satisfied in cash or the Person making such Investment
has received cash in consideration for the sale thereof, notwithstanding the
fact that such Investment may otherwise have been forgiven, released, canceled
or otherwise nullified.

     

    “Lender” means Manufacturers
and Traders Trust Company, and its successors, legal representatives, and
assigns

     

    
      
        
        

      

      
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    “LIBOR” means, the rate per
annum (rounded upward, if necessary, to the nearest 1/16th of 1%) obtained by
dividing (i) the London Interbank Offered Rate, as applicable in accordance with
the LIBOR Rate selected by Borrower for each Loan, or in the case of Daily LIBOR
each day (or if such day is not a LIBOR Business Day, as fixed in the same
manner on the immediately preceding LIBOR Business Day, which day’s rate shall,
unless otherwise provided for, apply to the immediately succeeding non-LIBOR
Business Days), fixed by the British Bankers Association for United States
dollar deposits in the London interbank market at approximately 11:00 a.m.
London, England time (or as soon thereafter as practicable) as determined by the
Lender from any broker, quoting service or commonly available source utilized by
the Lender by (ii) a percentage equal to 100% minus the stated maximum rate of
all reserves required to be maintained against “Eurocurrency Liabilities” as
specified in Regulation D (or against any other category of liabilities which
includes deposits by reference to which the interest rate on LIBOR Loans is
determined or any category of extensions of credit or other assets which
includes loans by a non-United States’ office of a bank to United States
residents) on such date to any member bank of the Federal Reserve
System.  Notwithstanding any provision above, the practice of rounding
to determine LIBOR may be discontinued at any time in the Lender’s sole
discretion.

     

    “LIBOR Business Day” means any
day on which dealings in United States dollar deposits are carried on by banking
institutions in London that is also a Business Day.

     

    “LIBOR Loan” means any Loan
when and to the extent that the interest rate for such Loan is determined by
reference to LIBOR.

     

    “LIBOR Rate” means, as
selected by the Borrower for the respective LIBOR Loan, the one-month,
two-month, three-month, or six-month LIBOR, each with an Interest Period of
equal duration, or for Daily LIBOR Loans, one-month LIBOR, adjusting daily, but
in no case less than a floor LIBOR rate of one and one-fourth percent (1.25%),
and then in each case plus the Applicable Margin.

     

    “Lien” means any mortgage,
pledge, security interest, encumbrance, lien, assignment or charge of any kind
or description and shall include, without limitation, any agreement to give any
of the foregoing, any conditional sale or other title retention agreement, any
lease in the nature thereof including any lease or similar arrangement with a
public authority executed in connection with the issuance of industrial
development revenue bonds or pollution control revenue bonds, and the filing of
or agreement to give any financing statement under the Uniform Commercial Code
(or comparable law) of any jurisdiction naming the owner of the asset to which
such lien applies as a debtor (other than a filing which does not evidence an
outstanding secured obligation, or a commitment to make advances or to incur any
other obligation of any kind).

     

    “Linked Deposit Program” shall
mean the Empire State Development Linked Deposit Program, in which the Lender
is, as of the date hereof, a participant.

     

    “Loan(s)” means, (without
duplication) any amount disbursed by Lender to or on behalf of the Borrower
under the Loan Documents, whether such amount constitutes an original
disbursement of funds, or the continuation of any amount outstanding, under the
Revolving Credit Facility, the 2008 Term Loan Facility, the Energy Loan Note,
the GTC Term Loan Facility, the Mortgage Secured Term Loan Facility, or the
Equipment Line Facility.

     

    
      
        
        

      

      
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    “Loan Documents” means the
Agreement, the Notes, the Security Documents, all documents and agreements
related to the M&T Sale-Leaseback, and all other agreements, documents and
certificates executed with or in favor of the Lender in connection with the
Agreement or any amendment to the Agreement or to any other Loan
Document.

     

    “M&T Sale-Leaseback” means
the sale-leaseback arrangement between the Lender and the Borrower evidenced in
part by the Master Equipment Lease dated May 30, 2008.

     

    “Mandatory Prepayment” means a
prepayment required by Section 8.13(d) or 8.13(e).

     

    “Material Adverse Effect”
means (i) a material adverse effect on the financial condition, performance,
business, operations or prospects of the Credit Parties, taken as a whole, (ii)
material impairment of the legal ability of any of the Credit Parties to perform
their obligations under this Agreement or any of the Loan Documents in any
material respect, (iii) any material adverse effect on the binding nature,
validity or enforceability of any Loan Document as an obligation of any Credit
Party that is a party thereto, and (iv) material impairment of the rights and
remedies of the Lender under this Agreement or any of the Loan Documents,
including without limitation impairment or unenforceability of the perfection or
priority of any Lien held by the Lender.

     

    “Minimum Loan Amount” shall
mean (i) for any Daily LIBOR Loan, any whole dollar increment, (ii) for
Equipment Line Loans, $100,000, with minimum increments thereafter of $100,000,
and (iii) for other LIBOR Loans, $1,000,000, with minimum increments thereafter
of $500,000.

     

    “Money Market Investments”
means (a) any security issued or directly and fully guaranteed or insured by the
United States government or any agency or instrumentality thereof or having a
remaining maturity of not more than 270 days, (b) any certificate of deposit,
eurodollar time deposit and banker’s acceptance with remaining maturity of not
more than 270 days, any overnight bank deposit, any demand deposit account, in
each case with Lender or with any United States commercial bank having capital
and surplus in excess of $500,000,000 and rated B or better by Thomson Bankwatch
Inc., (c) any repurchase obligation with a term of not more than seven days for
underlying securities of the types described in clauses (a) and (b) above
entered into with any financial institution meeting the qualifications specified
in clause (b) above, and (d) any commercial paper issued by Lender and any other
commercial paper rated A-1 by Standard & Poor’s Rating Group of Prime-1 by
Moody’s Investors Service, Inc. and in any case having a remaining maturity of
not more than 270 days.

     

    “Mortgage” means the mortgage
in favor of the Lender made by GTC covering its interest in property and
improvements located at premises commonly known as 1450 Mission Avenue NE,
Albuquerque, New Mexico held pursuant to a Lease Agreement between the City of
Albuquerque, New Mexico and GTC dated as of March 1, 1999.

     

    “Mortgage Secured Term Loan”
means the $4,000,000 aggregate original outstanding principal balance term loan
described in Article 7 hereof.

     

    “Mortgage Secured Term Loan Maturity
Date” means December 16, 2014.

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    “Mortgage Secured Term Loan
Note” means the Term Loan Note evidencing the Mortgage Secured Term
Loan.

     

    “Mortgaged Property” means the
property and improvements covered by the Mortgage.

     

    “Multiemployer Plan” means a
“multiemployer plan” as defined in Section 4001(a)(3) of ERISA as to which any
of the Credit Parties or any ERISA Affiliate is obligated to make, has made, or
will be obligated to make contributions on behalf of participants who are or
were employed by any of them.

     

    “Net Cash Proceeds” shall mean
(a) in the case of any Casualty Event, the aggregate cash proceeds of insurance,
condemnation awards and other compensation received by any Person in respect of
such Casualty Event less (i) reasonable fees and expenses incurred by such
Person in connection therewith, and (ii) contractually required payments of Debt
to the extent secured by Liens on the property subject to such Casualty Event
and any income or transfer Taxes paid or reasonably estimated by such Person to
be payable by such Person as a result of such Casualty Event, and (b) in the
case of any Asset Disposition, the aggregate amount of all cash payments and
proceeds (including any cash payments made from time to time in respect to the
principal amount of any note or similar instrument or agreement providing for or
evidencing debt as the deferred purchase price owing from the purchaser of such
asset to the applicable Person) received by any Person in connection therewith
less (i) reasonable fees and expenses incurred by such Person in connection
therewith, (ii) Debt to the extent the amount thereof is secured by a Lien on
the property that is the subject of such Asset Disposition and the transferee
(or holder of the Lien on) such property requires that such Debt be repaid as a
condition of such Asset Disposition, and (iii) any income or transfer Taxes paid
or reasonably estimated by the Person to be payable by such Person as a result
of such Asset Disposition.

     

    “Net Income” means for the
applicable period, the net earnings of the Borrower on a consolidated basis,
determined in accordance with GAAP on a consistent basis, but
excluding:

     

    (a)           any
gain or loss arising from the sale of capital assets;

     

    (b)           any
non-cash gain or non-cash loss arising from any write-up of assets;

     

    (c)           net
earnings or losses of any Subsidiary of Borrower accrued prior to the date it
became a Subsidiary;

     

    (d)           net
earnings or losses of any Person, substantially all the assets of which have
been acquired in any manner by Borrower, realized by such Person prior to the
date of such acquisition;

     

    (e)           net
earnings or losses of any Person in which Borrower has an ownership interest,
except any such net earnings which have actually been received by Borrower in
the form of cash distributions and except the net earnings or losses of any
Guarantor;

     

    (f)       
    any portion of the net earnings of any Subsidiary of
Borrower which for any reason is unavailable for payment of dividends to
Borrower;

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    (g)           the
net earnings or losses of any Person to which any assets of Borrower shall have
been sold, transferred or disposed of after the date of such
transaction,

     

    (h)           the
net earnings or losses of any Person into which Borrower shall have merged, or
been a party to any consolidation or other form of reorganization, prior to the
date of such transaction;

     

    (i)      
     any gain arising from the acquisition of any
securities of Borrower; and

     

    (j)        
   any gain or loss arising from extraordinary
items.

     

    “Note(s)” means the Revolving
Credit Note, the 2008 Term Loan Note, the Energy Loan Note, the GTC Term Loan
Note, the Mortgage Secured Term Loan Note, and the Equipment Line Notes, and
“Note” means any of the
Notes.

     

    “Obligations” means and shall
include all of the Credit Parties’ obligations to the Lender and/or to any of
Lender’s affiliates of any kind or nature, arising now or in the future under or
related to this Agreement and/or the Loan Documents including obligations
related to the Notes, the M&T Sale-Leaseback, overdrafts, obligations
related to Rate Management Transactions, credit card transactions, automated
transfer transactions, electronic funds transfers, other transactions related to
the Credit Parties’ dealings with the Lender, interest accruing after the filing
of any petition or assignment in bankruptcy or for reorganization by or against
the Credit Parties (whether or not such a claim for such post-petition interest
is allowed in the proceedings), fees, charges, expenses, and amount payable with
respect to guaranties.

     

    “Organizational Documents”
means, as applicable to the particular Person, the certificate or articles of
incorporation or formation, bylaws, operating agreement, certificate of
partnership, partnership agreement, and other similar documents and agreements
related to formation and governance.

     

    “Overline Advance” means any
portion of a Loan under the Revolving Line Facility that is available under the
Borrowing Base only if the Inventory Overline Advance Rate is in
effect.

     

    “PBGC” means the Pension
Benefit Guarantee Corporation and any successor thereto.

     

    “Permitted Debt” means Debt
described in Section 12.1.

     

    “Permitted Liens” means the
following Liens:

     

    (a)           liens
imposed by any governmental authority for Taxes or charges not yet due or which
are being contested in good faith and by appropriate proceedings if adequate
reserves with respect thereto are maintained on the books of the Borrower
subject to such lien in accordance with GAAP on a consistent basis, provided no
tax lien filing, levy, or execution exists in connection therewith;

     

    (b)           carriers’,
warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like liens
arising in the ordinary course of business which are not overdue for a period of
more than thirty (30) days, or which are being contested in good faith and by
appropriate proceedings;

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

    (c)           pledges
or deposits under workers’ compensation, unemployment insurance and other social
security legislation;

     

    (d)           deposits
to secure the performance of bids, trade contracts (other than borrowed money),
leases, statutory obligations, surety and appeal bonds, performance bonds and
other obligations of a like nature incurred in the ordinary course of business;
and

     

    (e)           Liens
in favor of Lender.

     

    “Person” means any individual,
sole proprietorship, or other entity of any kind or nature including any
corporation, partnership, trust, unincorporated organization, limited liability
company, unlimited liability company, mutual company, joint stock company,
estate, union, employee organization, government or any agency or political
subdivision thereof.

     

    “Plan” means any employee
benefit plan, program, arrangement, practice or contract, maintained by or on
behalf of a Borrower or an ERISA Affiliate, which provides benefits or
compensation to or on behalf of employees or former employees, whether formal or
informal, whether or not written, including but not limited to the following
types of plans:

     

    (a)           Executive
Arrangements - any bonus, incentive compensation, stock option, deferred
compensation, commission, severance, “golden parachute”, “rabbi trust”, or other
executive compensation plan, program, contract, arrangement or
practice;

     

    (b)           ERISA
Plans - any “employee benefit plan” as defined in ERISA, including, but not
limited to, any defined benefit pension plan, profit sharing plan, money
purchase pension plan, savings or thrift plan, stock bonus plan, employee stock
ownership plan, Multiemployer Plan, or any plan, fund, program, arrangement or
practice providing for medical (including post-retirement medical),
hospitalization, accident, sickness, disability, or life insurance benefits;
and

     

    (c)           Other
Employee Fringe Benefits - any stock purchase, vacation, scholarship, day care,
prepaid legal services, severance pay or other fringe benefit plan, program,
arrangement, contract or practice.

     

    “Prepayment Premium” means a
payment by the Borrower with respect to any prepayment in whole or in part of
any Fixed Rate Loan equal to the greater of (a) one percent (1%) of the
principal sum prepaid, or (b) an amount equal to the present value of the
difference between (i) the amount of interest that would have accrued on the
principal sum prepaid from the date of the prepayment to the end of the
applicable Fixed Rate Period, at the interest rate applicable to the Note in
effect on the date of prepayment and (ii) the amount of interest that would have
accrued on the principal sum prepaid from the date of the prepayment to the end
of the applicable Fixed Rate Period of the applicable Note at the Current Market
Rate.  “Current
Market Rate” shall mean the most recent yield on United States Treasury
Obligations adjusted to a constant maturity having a term most nearly
corresponding to Fixed Rate Period remaining from the date of prepayment to the
last day of the applicable Fixed Rate Period, in effect two (2) Business Days
prior to the prepayment date as published by the Board of Governors of the
Federal Reserve System in the Federal reserve Statistical Release H.15 (519), or
by such other quoting service, index, or commonly available source utilized by
the Lender.  The “present value” calculation shall use the Current
Market Rate as the discount rate and shall be calculated as if each installment
of the principal sum had been made when due during the remainder of the
applicable Fixed Rate Period.

     

    
      
        
        

      

      
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    “Prime Rate” means the rate of
interest announced by the Lender from time to time at its Principal Office as
its prime commercial lending rate, which rate is not intended to be the lowest
rate of interest charged by Lender to its borrowers.

     

    “Principal Office” means the
Lender’s office at 255 East Avenue, Rochester, New York 14604.

     

    “Quarterly Covenant Compliance
Sheet” or “QCC
Sheet” means the covenant compliance sheet delivered on a quarterly basis
by Borrower to Lender, in substantially the form of Exhibit A attached
hereto, including a certificate of the Chief Financial Officer of Borrower
certifying that no Event of Default or Default has occurred and certifying to
the accuracy of an attached schedule showing computation of financial covenants
contained in Article 13 hereof.

     

    “Rate Management Transaction”
means any transaction (including an agreement with respect thereto) now existing
or hereafter entered into by any Credit Party which is a rate swap, basis swap,
forward rate transaction, commodity swap, commodity option, equity or equity
index swap, equity or equity index option, bond option, interest rate option,
foreign exchange transaction, cap transaction, floor transaction, collar
transaction, forward transaction, currency swap transaction, cross-currency rate
swap transaction, currency option or any other similar transaction (including
any option with respect to any of these transactions) or any combination
thereof, whether linked to one or more interest rates, foreign currencies,
commodity prices, equity prices or other financial measures.

     

    “Release” has the same meaning
as given to that term in Section 101(22) of the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. Section
9601(22), and the regulations promulgated thereunder.

     

    “Revolving Credit Commitment”
means the Revolving Credit Commitment described in Section 2.1.

     

    “Revolving Credit Facility”
means the revolving credit facility established pursuant to Section 2.1 of this
Agreement.

     

    “Revolving Credit Loan(s)”
means a Loan or Loans made by the Lender to Borrower under the Revolving Credit
Facility.

     

    “Revolving Credit Note” means
the Amended and Restated Revolving Credit Note described in Section
2.4.

     

    “Revolving Credit Termination
Date” means December 16, 2012.

     

    
      
        
        

      

      
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    “Security Agreement” means the
General Security Agreement made by each Credit Party in favor of
Lender.

     

    “Security Documents” means
those documents set forth on Schedule 1.1(A).

     

    “Subsidiary” means any Person,
the accounts of which would be consolidated with those of the parent in the
parent’s consolidated financial statements in accordance with GAAP (including
among others consolidated subsidiaries of consolidated
subsidiaries).

     

    “Tax” means any federal,
state, provincial, or foreign tax (including withholding tax), assessment, or
other governmental charge (including penalties and interest) upon a Person or
upon its assets, revenues, income, or profits.

     

    “Trademark Security
Agreements” means the Trademark Collateral Security and Pledge Agreement
listed on Schedule
1.1(A), and any similar
document delivered by any Credit Party, and, as amended, modified or restated
from time to time.

     

    “Unfinanced Capital
Expenditures” means all capital expenditures other than (i) capital
expenditures financed by the Lender (but excluding for this definition any
capital expenditures financed with the proceeds of a Revolving Credit Loan), and
(ii) capital expenditures financed with Debt (other than the Loans) permitted
under this Agreement or Debt to which the Lender consents in
writing.

     

    1.2         Interpretation.  This
Agreement has been prepared in cooperation of counsel for each of the parties,
and shall not be construed as against any particular party as
drafter.  Unless otherwise expressly provided in this Agreement, the
following interpretations shall apply:

     

    (a)           references
in this Agreement to statutes shall include any amendments of the same and any
rules and regulations promulgated thereunder,

     

    (b)           references
to Persons include their permitted successors and assigns, and in the case of
any governmental authority, any Person succeeding to its functions and
capacities,

     

    (c)           references
to agreements (including exhibits and schedules thereto) include amendments,
assignments, and restatements provided that such amendments, assignments, and
restatements are not prohibited by the Loan Documents,

     

    (d)           references
to specific sections, articles, annexes, schedules, and exhibits are to this
Agreement,

     

    (e)           words
importing gender include the other gender,

     

    (f)           the
singular includes the plural and the plural includes the singular,

     

    (g)           the
words, “including”, “include”, and “includes” shall be deemed to be followed by
the words “without limitation”,

     

    
      
        
        

      

      
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    (h)           each
authorization herein shall be deemed irrevocable and coupled with an
interest,

     

    (i)         
  obligations or liabilities of the Credit Parties, or any of them, to
which this Agreement makes reference shall be joint and several,

     

    (j)        
   accounting terms shall be interpreted, and all determinations
relating thereto shall be made, in accordance with GAAP, and

     

    (k)           captions
and headings are for ease of reference only and shall not affect the
construction hereof.

     

    ARTICLE 2
- REVOLVING CREDIT FACILITY

     

    2.1         Revolving Credit
Commitment.  The Lender agrees, subject to Section 2.2 and the
other terms and conditions hereinafter set forth, to make Revolving Credit Loans
to the Borrower from time to time during the period from the Closing Date up to
but not including the Revolving Credit Termination Date in an aggregate
principal amount not to exceed at any time outstanding the amount of $15,000,000
(the “Revolving Credit
Commitment”).  During the period from the Closing Date to the
Revolving Credit Termination Date, within the limits of the Revolving Credit
Commitment and subject to Section 2.2, the Borrower may borrow, prepay pursuant
to Section 2.5, and reborrow under this Section 2.1.  Except as
otherwise provided in this Agreement, the Revolving Credit Loans will be
outstanding as LIBOR Loans.

     

    2.2         Borrowing Base; Overline
Advances.  Notwithstanding the provisions of Section 2.1, the
aggregate principal amount of all outstanding Revolving Credit Loans shall not
exceed the lesser of the Borrowing Base and the Revolving Credit
Commitment.

     

    Upon
Borrower’s request the Inventory Overline Advance Rate shall apply and the
Lender will make Overline Advances from time to time; provided, however no new
Overline Advance shall be available unless no Overline Advances have been
outstanding in the immediately prior thirty (30) consecutive days and no Default
then exists.

     

    At any
time that the aggregate principal amount of all outstanding Revolving Credit
Loans exceeds the lesser of the Borrowing Base and the Revolving Credit
Commitment, the Borrower shall immediate prepay a portion of the Revolving
Credit Loans that is at least the amount of such excess pursuant to Section 2.5
hereof.

     

    2.3         Interest.

     

    (a)           Interest
shall accrue each day on each LIBOR Loan from and including the first day of
each Interest Period applicable thereto until, but not including, the last day
of each such Interest Period or the day the LIBOR Loan is paid in full (if
sooner) at a rate per annum equal to the LIBOR Rate, as determined using LIBOR
in effect on the following dates, as applicable:

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    (i)           for
LIBOR Loans other than Daily LIBOR Loans, (A) for new LIBOR Loans, two (2) LIBOR
Business Days before the Draw Date; (B) for continuations of and conversions to
LIBOR Loans, the LIBOR Business Day the Lender receives (or is deemed to
receive) the required Notice in accordance with the terms of this Agreement; (C)
for LIBOR Loans where the Automatic Continuation Option is in effect, the
applicable Automatic Adjustment Rate Determination Date for such LIBOR Loan,
and

     

    (ii)          for
Daily LIBOR Loans, at a rate per annum equal to the LIBOR Rate in effect each
day (or if such day is not a LIBOR Business Day, as fixed in the same manner on
the immediately preceding LIBOR Business Day, which day’s rate shall, unless
otherwise provided for, apply to the immediately succeeding non-LIBOR Business
Days).

     

    (b)           After
any conversion to a Base Rate Loan, interest shall accrue on the Base Rate Loan
from and including the first date a Loan becomes a Base Rate Loan to, but not
including, the day such Base Rate Loan is paid in full or converted back to a
LIBOR Loan, at the rate per annum equal to the Base Rate.  Any change
in the Base Rate shall be effective on the date of such change.

     

    2.4         Revolving Credit
Note.  Borrower’s obligation to repay the Revolving Credit
Loans shall be evidenced by a Revolving Credit Note in substantially the form of
Exhibit B to
this Agreement, in favor of Lender in the aggregate principal amount of Lender’s
Revolving Credit Commitment.

     

    2.5         Payments.

     

    (a)           Interest
shall be paid, in the case of LIBOR Loans other than Daily LIBOR Loans on the
last day of the applicable Interest Period, but no less often than every three
months, and in the case of Daily LIBOR Loans and Base Rate Loans on the first
day of every month.  Interest on any Base Rate Loans shall be paid on
the first day of each month.  All accrued and unpaid interest shall be
due and payable on the Termination Date.

     

    (b)           Each
Overline Advance shall be repaid in full no later than the sixtieth (60th) day
after the making of such Overline Advance.

     

    (c)           All
Revolving Credit Loans shall be repaid in full on the Revolving Credit
Termination Date.

     

    (d)           At
any time that the Borrower becomes aware or receives notice (oral or written)
that the outstanding principal amount of all Revolving Credit Loans exceeds the
Borrowing Base, Borrower shall immediately prepay that portion of the Revolving
Credit Loans that is necessary to comply with the provisions of Section
2.2.

     

    2.6         Unused Commitment
Fee.  Borrower agrees to pay to the Lender the Applicable
Unused Fee on the average amount of the Revolving Credit Commitment unused
during each Fiscal Quarter.  Such fee shall be payable quarterly and
the Lender is hereby authorized to charge Borrower’s account with Lender for the
amount of such fee.  The Lender will send Borrower an invoice setting
forth the amount of such fee and the basis upon which it was calculated, and
will send such invoice within two (2) Business Days after such fee is so
charged.

     

    
      
        
        

      

      
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    2.7         Use of
Proceeds.  Proceeds of the Revolving Credit Loans shall be used
for the Borrower’s general corporate purposes including purchase of the stock of
GTC.

     

    ARTICLE 3
– 2008 TERM LOAN FACILITY

     

    3.1         2008 Term
Loan.  Lender previously made, and shall continue, a term loan
(the “2008 Term Loan”)
in the original principal amount of $1,700,000 and a principal balance on the
Closing Date of $$689,988, for the benefit of Borrower on the terms and
conditions hereinafter set forth.

     

    3.2         2008 Term Loan
Note.  Borrower’s obligation to repay the 2008 Term Loan shall
be evidenced by its promissory note in substantially the form of Exhibit C to this
Agreement, with blanks appropriately completed.

     

    3.3         Principal Payments on 2008
Term Loan.  Borrower agrees to pay the principal amount of the
2008 Term Loan in consecutive installments on the first day of each month in the
amount of $28,334 each.  The entire unpaid principal amount of the
2008 Term Loan shall be due and payable on the 2008 Term Loan Maturity
Date.

     

    3.4         Interest.

     

    (a)           Borrower
shall pay interest on the outstanding principal amount of the 2008 Term Loan at
the Fixed Rate of six and seven-tenths percent (6.7%) per
annum.  Interest on the 2008 Term Loan shall be calculated on the
basis of a year of 360 days for the actual number of days elapsed.

     

    (b)           Interest
on the 2008 Term Loan shall be paid in immediately available funds to the Lender
on the first day of each month.  All remaining accrued interest shall
be due and payable on the 2008 Term Loan Maturity Date.

     

    ARTICLE 4
- ENERGY LOAN

     

    4.1         Energy Loan
Note.  Borrower’s obligation to repay the Energy Loan is
evidenced by its promissory note with attached rider in substantially the form
of Exhibit D to
this Agreement.

     

    4.2         Energy Loan
Payments.  Borrower shall make payments of principal and
interest as provided in the Energy Loan Note.  All remaining unpaid
principal and accrued interest on the Energy Loan shall be due and payable in
full on the Energy Loan Maturity Date.

     

    4.3         Interest.  Borrower
shall pay interest on the outstanding principal amount of the Energy Loan as
provided in the Energy Loan Note.

     

    4.4         Energy Loan
Documents.  The provisions of this Agreement supersede and
replace the Agreement (Affirmative Agreements) containing financial covenants
executed by and between the Borrower and Lender in connection with closing of
the Energy Loan.

     

    
      
        
        

      

      
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    ARTICLE 5
- EQUIPMENT LINE OF CREDIT FACILITY

     

    5.1         Equipment Line of
Credit.  Subject to Section 5.2 and the other terms and
conditions hereinafter set forth, the Lender has established the Equipment Line
Facility, available in the discretion of the Lender to the Borrower from time to
time during the period from the Closing Date up to but not including the
Equipment Line Maturity Date, in an aggregate principal amount of $1,500,000,
less the amount of Equipment Line Loans made under the Prior Agreement (the
“Equipment Line
Commitment”).  No reborrowing is available under the Equipment
Line Facility.  The Lender will consider Borrower’s requests for
Equipment Line Loans, but shall have the sole and absolute discretion whether to
make any Loan (or any portion of any Loan) requested by Borrower, regardless of
any general availability under the Equipment Line Facility.

     

    5.2         Notice and Manner of
Borrowing.  Borrower may make requests for Equipment Line
Loans, in minimum amounts of $100,000, to the Lender specifying: (a) the date of
each such Loan; (b) the amount of such Loan; (c) whether such Loan will be a
Fixed Rate Loan or LIBOR Loan; (d) in the case of a LIBOR Loan, the duration of
the Interest Period applicable thereto, and (e) the purpose of the Loan
including copies of invoices for equipment being purchased and other supporting
documentation reasonably requested by Lender.  Subject to the terms of
this Agreement including Section 5.1, and upon fulfillment of the applicable
conditions set forth in Article 10, the Lender shall credit the amount of such
Equipment Line Loan, in immediately available funds, to the account of the
Borrower maintained with the Lender for that purpose.

     

    5.3         Interest.

     

    (a)           The
Equipment Line Loans may be outstanding as LIBOR Loans or Fixed Rate Loans (in
which case the rate shall be fixed for the duration of the term of the Equipment
Line Loan), as elected with respect to each Equipment Line Loan at least three
(3) Business Days before the date on which such Equipment Line Loan is
made.  Borrower shall pay interest to the Lender on the outstanding
and unpaid principal amount of the each Equipment Line Loan at the LIBOR Rate or
the Fixed Rate, whichever may have been elected by the Borrower.  Each
LIBOR Rate shall be effective for the applicable Interest
Period.  Interest on each Equipment Line Loan shall be calculated on
the basis of a year of 360 days for the actual number of days
elapsed.

     

    (b)           Provided
that the Lender remains a participant in the Linked Deposit Program and approval
is received from New York Empire State Development for Borrower’s participation
in such program at the level provided herein, the Lender will provide the
Borrower with the interest rate benefit under the Linked Deposit Program for up
to an aggregate of $1,000,000 in Equipment Line Loans.  Borrower must
elect a Fixed Rate for any Equipment Line Loan for the period in which Linked
Deposit Program benefits are received, which period may not exceed forty-eight
months, and the other terms and conditions of general application to the Linked
Deposit Program must be satisfied.

     

    (c)           Interest
shall accrue each day on each LIBOR Loan from and including the first day of
each Interest Period applicable thereto until, but not including, the last day
of each such Interest Period or the day the LIBOR Loan is paid in full (if
sooner) at a rate per annum equal to the LIBOR Rate, as determined using LIBOR
in effect on the following dates, as applicable:

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

     

     
(i)           for LIBOR
Loans other than Daily LIBOR Loans, (A) for new LIBOR Loans, two (2) LIBOR
Business Days before the Draw Date; (B) for continuations of and conversions to
LIBOR Loans, the LIBOR Business Day the Lender receives (or is deemed to
receive) the required Notice in accordance with the terms of this Agreement; (C)
for LIBOR Loans where the Automatic Continuation Option is in effect, the
applicable Automatic Adjustment Rate Determination Date for such LIBOR Loan,
and

     

     
(ii)          for Daily LIBOR
Loans, at a rate per annum equal to the LIBOR Rate in effect each day (or if
such day is not a LIBOR Business Day, as fixed in the same manner on the
immediately preceding LIBOR Business Day, which day’s rate shall, unless
otherwise provided for, apply to the immediately succeeding non-LIBOR Business
Days).

     

    (d)           After
any conversion to a Base Rate Loan, interest shall accrue on the Base Rate Loan
from and including the first date a Loan becomes a Base Rate Loan to, but not
including, the day such Base Rate Loan is paid in full or converted back to a
LIBOR Loan, at the rate per annum equal to the Base Rate.  Any change
in the Base Rate shall be effective on the date of such change.

     

    5.4         Equipment Line
Notes.  Borrower’s obligation to repay each Equipment Line Loan
shall be evidenced by an Equipment Line Note in substantially the form of Exhibit E to this
Agreement, with blanks appropriately completed, in favor of Lender in the
principal amount of such Equipment Line Loan.  In addition, for any
Equipment Line Note to which the Linked Deposit Program will apply, the Borrower
will execute and deliver to Lender a Linked Deposit Program Equipment Line Note
Rider in substantially the form of Exhibit F to this
Agreement, with blanks appropriately completed.

     

    5.5         Payments.

     

    (a)           Interest
on outstanding Equipment Line Loans shall be paid in immediately available funds
to the Lender, in the case of LIBOR Loans on the last day of the applicable
Interest Period but no less often than every three months, and in the case of
Base Rate Loans or Fixed Rate Loans, on the first day of each
month.  All accrued and unpaid interest shall be due and payable on
the Revolving Credit Termination Date.

     

    (b)           The
principal of each Equipment Line Loan shall be repaid in consecutive monthly
installments on the first day of each month, each equal to one-sixtieth of the
original principal amount of the particular Equipment Line Loan.  All
Equipment Line Loans shall be repaid in full on the Revolving Credit Termination
Date.

     

    5.6         Use of
Proceeds.  Proceeds of the Equipment Line Loans shall be used
to finance the purchase price of capital equipment.

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

     

    ARTICLE 6
– GTC TERM LOAN FACILITY

     

    6.1         GTC Term
Loan.  Lender agrees, on the Closing Date, on the terms and
conditions hereinafter set forth, to make a term loan (the “GTC Term Loan”) to Borrower
in the principal amount of Five Million Dollars ($5,000,000).

     

    6.2         Interest.

     

    (a)           The
GTC Term Loan shall be outstanding and bear interest as a LIBOR Loan, initially
as a Daily Rate LIBOR Loan.  Each LIBOR Rate shall be effective for
the applicable Interest Period.  Interest on the GTC Term Loan shall
be calculated on the basis of a year of 360 days for the actual number of days
elapsed.

     

    (b)           Interest
shall accrue each day on each LIBOR Loan from and including the first day of
each Interest Period applicable thereto until, but not including, the last day
of each such Interest Period or the day the LIBOR Loan is paid in full (if
sooner) at a rate per annum equal to the LIBOR Rate, as determined using LIBOR
in effect on the following dates, as applicable:

     

     
(i)           for LIBOR
Loans other than Daily LIBOR Loans, (A) for new LIBOR Loans, two (2) LIBOR
Business Days before the Draw Date; (B) for continuations of and conversions to
LIBOR Loans, the LIBOR Business Day the Lender receives (or is deemed to
receive) the required Notice in accordance with the terms of this Agreement; (C)
for LIBOR Loans where the Automatic Continuation Option is in effect, the
applicable Automatic Adjustment Rate Determination Date for such LIBOR Loan,
and

     

     
(ii)          for Daily LIBOR
Loans, at a rate per annum equal to the LIBOR Rate in effect each day (or if
such day is not a LIBOR Business Day, as fixed in the same manner on the
immediately preceding LIBOR Business Day, which day’s rate shall, unless
otherwise provided for, apply to the immediately succeeding non-LIBOR Business
Days).

     

    (c)           After
any conversion to a Base Rate Loan, interest shall accrue on the Base Rate Loan
from and including the first date a Loan becomes a Base Rate Loan to, but not
including, the day such Base Rate Loan is paid in full or converted back to a
LIBOR Loan, at the rate per annum equal to the Base Rate.  Any change
in the Base Rate shall be effective on the date of such change.

     

    6.3         Payments on GTC Term
Loan.

     

    (a)           The
Borrower shall repay the principal amount of the GTC Term Loan in consecutive
monthly principal installments of $83,333 each.

     

    (b)           Interest
on the GTC Term Loan shall be paid to the Lender, in the case of LIBOR Loans on
the last day of the applicable Interest Period but no less often than every
three months, and in the case of Base Rate Loans on the first day of each
month.

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

     

    (c)           The
entire remaining unpaid principal amount of the GTC Term Loan and all accrued
interest thereon shall be due and payable on the GTC Term Loan Maturity Date, or
sooner as otherwise provided in this Agreement.

     

    6.4         GTC Term Loan
Note.  Borrower’s obligation to repay the GTC Tem Loan shall be
evidenced by the GTC Term Loan Note in substantially the form of Exhibit G to this
Agreement, with blanks appropriately completed.

     

    6.5         Use of
Proceeds.  The proceeds of the GTC Term Loan shall be used by
Borrower for the GTC Transaction.

     

    ARTICLE 7
– MORTGAGE SECURED TERM LOAN FACILITY

     

    7.1         Mortgage Secured Term
Loan.  Lender agrees, on the Closing Date, on the terms and
conditions hereinafter set forth, to make a term loan (the “Mortgage Secured Term Loan”)
to Borrower in the principal amount of Four Million Dollars
($4,000,000).

     

    7.2         Interest.

     

    (a)           The
Mortgage Secured Term Loan shall be outstanding and bear interest as a LIBOR
Loan, initially as a Daily Rate LIBOR Loan.  Each LIBOR Rate shall be
effective for the applicable Interest Period.  Interest on the
Mortgage Secured Term Loan shall be calculated on the basis of a year of 360
days for the actual number of days elapsed.

     

    (b)           Interest
shall accrue each day on each LIBOR Loan from and including the first day of
each Interest Period applicable thereto until, but not including, the last day
of each such Interest Period or the day the LIBOR Loan is paid in full (if
sooner) at a rate per annum equal to the LIBOR Rate, as determined using LIBOR
in effect on the following dates, as applicable:

     

     
(i)           for LIBOR
Loans other than Daily LIBOR Loans, (A) for new LIBOR Loans, two (2) LIBOR
Business Days before the Draw Date; (B) for continuations of and conversions to
LIBOR Loans, the LIBOR Business Day the Lender receives (or is deemed to
receive) the required Notice in accordance with the terms of this Agreement; (C)
for LIBOR Loans where the Automatic Continuation Option is in effect, the
applicable Automatic Adjustment Rate Determination Date for such LIBOR Loan,
and

     

     
(ii)          for Daily LIBOR
Loans, at a rate per annum equal to the LIBOR Rate in effect each day (or if
such day is not a LIBOR Business Day, as fixed in the same manner on the
immediately preceding LIBOR Business Day, which day’s rate shall, unless
otherwise provided for, apply to the immediately succeeding non-LIBOR Business
Days).

     

    (c)           After
any conversion to a Base Rate Loan, interest shall accrue on the Base Rate Loan
from and including the first date a Loan becomes a Base Rate Loan to, but not
including, the day such Base Rate Loan is paid in full or converted back to a
LIBOR Loan, at the rate per annum equal to the Base Rate.  Any change
in the Base Rate shall be effective on the date of such change.


    
      
         


      

      
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      7.3          Payments on Mortgage Secured
Term Loan.

       

      (a)           The
Borrower shall repay the principal amount of the Mortgage Secured Term Loan in
consecutive monthly principal installments of $22,222 each.

       

      (b)           Interest
on the Mortgage Secured Term Loan shall be paid to the Lender, in the case of
LIBOR Loans on the last day of the applicable Interest Period but no less often
than every three months, and in the case of Base Rate Loans on the first day of
each month.

       

      (c)           The
entire remaining unpaid principal amount of the Mortgage Secured Term Loan and
all accrued interest thereon shall be due and payable on the Mortgage Secured
Term Loan Maturity Date, or sooner as otherwise provided in this
Agreement.

       

      7.4          Mortgage Secured Term Loan
Note.  Borrower’s obligation to repay the Mortgage Secured Tem
Loan shall be evidenced by the Mortgage Secured Term Loan Note in substantially
the form of Exhibit
H to this Agreement, with blanks appropriately completed.

       

      7.5          Use of
Proceeds.  The proceeds of the Mortgage Secured Term Loan shall
be used by Borrower for the GTC Transaction.

       

      ARTICLE 8
- CERTAIN GENERAL PROVISIONS

       

      8.1          Notice and Manner of
Borrowing; Continuations, Conversions and; Funding.

       

      (a)          General
Requirements.

       

      (i)           Each
Revolving Credit Loan advanced hereunder shall be in the form of a LIBOR Loan,
and as elected by the Borrower each Equipment Line Loan may be in the form of
LIBOR Loans.  The GTC Term Loan and the Mortgage Secured Term Loan
shall be in the form of LIBOR Loans.

       

      (ii)          The
Lender may make any Revolving Credit Loan in reliance upon any oral, telephonic,
written, teletransmitted or other request (the “Request(s)”) that the Lender
in good faith believes to be valid and to have been made by Borrower or on
behalf of Borrower by an authorized person.  The Lender may act on the
Request of any authorized person until the Lender shall have received from
Borrower, and had a reasonable time to act on, written notice revoking the
authority of such authorized person.  The Lender shall incur no
liability to Borrower or to any other person as a direct or indirect result of
making any Revolving Credit Loan pursuant to this subsection.

       

      (iii)         No
more than five (5) LIBOR Rate tranches, not including Daily LIBOR Rate Loans,
may be outstanding at any one time.

       

      (b)          Requests for LIBOR
Loans.  Borrower shall give the Lender its irrevocable Request
for each LIBOR Loan specifying:


      
        
           


        

        
          27

          
            

          

        

        
           


        

      

       

      (i)           the
Draw Date for the LIBOR Loan, which may be the same day for Daily LIBOR Loans
and which must be at least two (2) LIBOR Business Days following the date of the
Request for other LIBOR Loans;

       

      (ii)          the
aggregate amount of such LIBOR Loan, which amount shall not be less than the
Minimum Borrowing Amount;

       

      (iii)         the
applicable LIBOR Rate selection and corresponding Interest Period duration
unless the Request is for a Daily LIBOR Loan; and

       

      (iv)         whether
the Automatic Continuation Option will be in effect for such LIBOR Loan unless
the Request is for a Daily LIBOR Loan.  The Automatic Continuation
Option shall be in effect for each Daily LIBOR Loan and for each other LIBOR
Loan unless otherwise specified by Borrower in writing.

       

      (c)          Delivery of Requests and
Notices.  Delivery of a Notice or Request for a LIBOR Loan
shall be made to the Lender at the address for notices in Section 16.4, or such
other address designated by the Lender from time to time.

       

      (d)          Continuation
Elections.  An authorized Person may, upon irrevocable Request
to the Lender in accordance with Section 8.1(e) below, elect to continue, as of
the last day of the applicable Interest Period, any or a portion (subject to the
Minimum Borrowing Amount limitation) of any LIBOR Loan with the same or a
different Interest Period, provided no partial continuation of a LIBOR Loan with
a different Interest Period shall reduce the outstanding principal amount of the
remaining LIBOR Loan with the same Interest Period to less than the Minimum
Borrowing Amount.

       

      (e)          Notice of
Continuation.

       

      (i)          For
an election under Section 8.1(d) above, an authorized person must deliver to the
Lender, by 2:00 p.m. (New York time) on a Business Day, a written notice for an
election under Section 8.1(d) (a “Notice”),
specifying:

       

      (A)          the
aggregate amount of each LIBOR Loan to be continued;

       

      (B)           the
applicable LIBOR Rate selection and corresponding Interest Period duration for
each LIBOR Loan to be continued; and

       

      (C)           whether
the Automatic Continuation Option will be in effect for each such LIBOR
Loan.  The Automatic Continuation Option shall be in effect for each
LIBOR Loan, unless otherwise specified by Borrower in writing.

       

      (ii)         For
any election in accordance with Section 5.1(d) above, the Continuation Date
shall be the later of (A) the last day of the applicable Interest Period, or (B)
two (2) LIBOR Business Days following the date the Lender receives the Notice of
Continuation, except as otherwise determined by the Lender in its sole
discretion.  If a Notice is received after 2:00 p.m. (New York time)
on any Business Day, such Notice will be deemed to have been received on the
next Business Day.  Accordingly, as an example, if Borrower has a
LIBOR Loan with a one-month Interest Period ending on June 15 and wants to
continue the LIBOR Loan with a two- month Interest Period, Borrower must deliver
to the Lender an appropriate Notice of Continuation by no later than 2:00 p.m.
(New York time) on June 13 (assuming that June 13 is a Business Day and June 14
and 15 are LIBOR Business Days).


      
        
           


        

        
          28

          
            

          

        

        
           


        

      


      (iii)        For
LIBOR Loans with the Automatic Continuation Option in effect, the Lender shall,
at the end of each Interest Period, automatically continue such LIBOR Loan with
the same Interest Period unless a contrary Notice has been
received.

       

      (iv)        The
Lender may take action on any Notice in reliance upon any oral, telephonic,
written or teletransmitted Notice that the Lender in good faith believes to be
valid and to have been made by Borrower or on behalf of Borrower by an
authorized person.  No Notice may be delivered by
e-mail.  The Lender may act on the Notice from any authorized person
until the Lender shall have received from Borrower, and had a reasonable time to
act on, written notice revoking the authority of such authorized
person.  The Lender shall incur no liability to Borrower or to any
other person as a direct or indirect result of acting on any Notice under this
Agreement.  The Lender, in its sole discretion, may reject any Notice
that is incomplete.

       

      (f)          Expiration of Interest
Period.  With respect to any LIBOR Loan for which an Automatic
Continuation Option is not in effect, if Borrower does not deliver to the Lender
an appropriate Notice of Continuation (in accordance with the terms hereof) at
least two (2) LIBOR Business Days before the end of an Interest Period, the
Lender shall have the right (but not the obligation) to immediately, and without
notice, convert such LIBOR Loan into a Daily LIBOR Loan and such Loan shall
continue as a Daily LIBOR Loan until two (2) LIBOR Business Days after the
Lender receives an appropriate Notice under Section 8.1(e) electing a different
Interest Period.  A Notice of Continuation received one (1) LIBOR
Business Day before the end of an Interest Period may not effectuate a
continuation of such Loan as a LIBOR Loan as of the last day of the Interest
Period.  Rather, such LIBOR Loan may be converted (in the manner
described above) to a Daily LIBOR Loan on the last day of the Interest
Period.  Such Notice of Continuation, however, will be deemed to be a
Notice that will be effective two (2) LIBOR Business Days from the date it is
received (or deemed to be received) by the Lender.

       

      (g)          Conversion upon
Default.  Unless the Lender shall otherwise consent in writing,
if (i) Borrower fails to pay when due, in whole or in part, the Obligations, or
(ii) there exists any Default, no conversion or continuation elections by the
Borrower shall be permitted, and the Lender, in its sole discretion, may (i)
permit any outstanding LIBOR Loan to continue until the last day of the
applicable Interest Period at which time such Loan shall automatically be
converted into a Base Rate Loan or (ii) convert any outstanding LIBOR Loan into
a Base Rate Loan before the end of the applicable Interest Period applicable to
such LIBOR Loan.  Nothing herein shall be construed to be a waiver by
the Lender to have any Loan accrue interest at the Default Rate or the right of
the Lender to charge and collect a Breakage Fee.

       

      8.2          Method of
Payment.  Borrower shall make each payment under this Agreement
and the Notes not later than 12:00 noon (New York time) on the date when due in
lawful money of the United States to the Lender at its Principal Office in
immediately available funds.  Borrower hereby authorizes the Lender,
if and to the extent payment is not made when due under this Agreement and the
Notes, to charge from time to time against any account of Borrower with the
Lender any amount as due.


      
        
           


        

        
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      8.3          Illegality.  Notwithstanding
any other provision in this Agreement, if any applicable law, rule, or
regulation, or any change therein, or any change in the interpretation or
administration thereof by any governmental authority, central bank, or
comparable agency charged with the interpretation or administration thereof, or
compliance by the Lender with any request or directive (whether or not having
the force of law) of any such authority, central bank, or comparable agency
shall make it unlawful or impossible, or impractical as a result of a
contingency occurring after the date of this Agreement that materially affects
the interbank market for the Lender to maintain or fund LIBOR Loans, then upon
notice to the Borrower, the outstanding principal amount of all LIBOR Loans,
together with interest accrued thereon, and any other amounts payable to the
Lender under this Agreement shall (a) at the election of Borrower, be Converted
into Base Rate Loans of the same principal amount or, if no such election is
made, be repaid (b) immediately upon demand of the Lender if such change or
compliance with such request, in the judgment of the Lender, requires immediate
repayment, or (c) at the expiration of the last Interest Period to expire before
the effective date of any such change or request.

       

      8.4          Disaster.  Notwithstanding
anything to the contrary herein, if the Lender determines (which determination
shall be conclusive) that:

       

      (a)           quotations
of interest rates for the relevant deposits referred to in the definition of
LIBOR Rate are not being provided in the relevant amounts or for the relative
maturities for purposes of determining the rate of interest on a LIBOR Loan as
provided in this Agreement; or

       

      (b)           the
relevant rates of interest referred to in the definition of LIBOR Rate upon the
basis of which the rate for any such type of Loan is to be determined do not
accurately cover the cost to the Lender of making or maintaining LIBOR
Loans;

       

      then the
Lender shall forthwith give notice thereof to the Borrower, whereupon (i) the
obligation of the Lender to make LIBOR Loans shall be suspended until the Lender
notifies the Borrower that the circumstances giving rise to such suspension no
longer exist, and (ii) at the election of Borrower, the LIBOR Loans shall be
Converted into Base Rate Loans of the same principal amount or, if no such
election is made, the Borrower shall repay in full the then outstanding
principal amount of each LIBOR Loan together with accrued interest thereon, on
the last day of the then current Interest Period applicable to such
Loan.


      
        
           


        

        
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      8.5          Increased
Cost.  From time to time upon notice to the Borrower from the
Lender, the Borrower shall pay to the Lender such amounts as the Lender may
determine to be necessary to compensate the Lender for any costs incurred by the
Lender which the Lender determines are attributable to its making or maintaining
any LIBOR Loans hereunder or its obligation to make any such Loans hereunder, or
any reduction in any amount receivable by the Lender under this Agreement or the
Notes in respect of any such Loans or such obligation (such increases in costs
and reductions in amounts receivable being herein called “Additional Costs”), resulting
from any change after the date of this Agreement in U.S. federal, state,
municipal, or foreign laws or regulations (including Regulation D), or the
adoption or making after such date of any interpretations, directives, or
requirements applying to a class of banks including the Lender of or under U.S.
federal, state, municipal, or foreign laws or regulations (whether or not having
the force of law) by any court or governmental or monetary authority charged
with the interpretation or administration thereof (“Regulatory Change”), which:
(a) changes the basis of taxation of any amounts payable to the Lender under
this Agreement or the Notes in respect of any such Loans (other than Taxes
imposed on the overall net income of the Lender for any of such Loans by the
jurisdiction where the Lender Principal Office is located); or (b) imposes or
modifies any reserve, special deposit, compulsory loan, or similar requirements
relating to any extensions or credit or other assets of, or any deposits with or
other liabilities of, the Lender (including any of such Loans or any deposits
referred to in the definition of LIBOR); or (c) imposes any other condition
affecting this Agreement or the Notes (or any such extensions of credit or
liabilities).  The Lender will notify the Borrower of any event
occurring after the date of this Agreement which will entitle the Lender to
compensation pursuant to this Section 8.5 as promptly as practicable after it
obtains knowledge thereof and determines to request such compensation, but in no
event will Borrower be liable for Additional Costs arising from any Regulatory
Change which occurred more than six (6) months before the date of such
notice.

       

      Determinations
by the Lender for purposes of this Section 8.5 of the effect of any Regulatory
Change on its costs of making or maintaining Loans or on amounts receivable by
it in respect of Loans, and of the additional amounts required compensate any
the Lender in respect of any Additional Costs, shall be conclusive, provided
that such determinations are made on a reasonable basis.

       

      8.6          Risk-Based
Capital.  In the event that the Lender determines that with
respect to any LIBOR Loans hereunder (a) compliance with any judicial,
administrative, or other governmental interpretation of any law or regulation or
(b) compliance by the Lender or any corporation that Controls Lender with any
guideline or request from any central bank or other governmental authority
(whether or not having the force of law) has the effect of requiring an increase
in the amount of capital required or expected to be maintained by the Lender or
any corporation that Controls the Lender, and the Lender determines that such
increase is based upon its obligations hereunder, and other similar obligations,
the Borrower shall pay to the Lender, such additional amount as shall be
certified by the Lender to be the amount allocable to the Lender’s obligations
to the Borrower hereunder.  The Lender will notify the Borrower of any
event occurring after the date of this Agreement that will entitle the Lender to
compensation pursuant to this Section 8.6 as promptly as practicable after it
obtains knowledge thereof and determines to request such compensation, but in no
event will the Borrower be liable for any compensation hereunder based on any
event which occurred more than six (6) months before the date of such
notice.

       

      Determinations
by the Lender for purposes of this Section 8.6 of the effect of any increase in
the amount of capital required to be maintained by the Lender and of the amount
allocable to the Lender’s obligations to the Borrower hereunder shall be
determined by the Lender acting reasonably and in good faith using averaging and
attribution methods that are reasonable, provided, however, absent manifest
error, the Lender’s computation shall be final, conclusive, and
binding.


      
        
           


        

        
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      8.7          Funding Loss
Indemnification.  Upon notice to Borrower from the Lender,
Borrower shall pay to the Lender such amount or amounts as shall be sufficient
(in the reasonable opinion of the Lender) to compensate it for any loss, cost,
liability, funding loss, or expense (in each case whether by reason of any
reduction in yield, the liquidation or reemployment of any deposit or other
funds acquired by the Lender, the fixing of any interest rate payable on LIBOR
Loans, or otherwise) (“Breakage Costs”) incurred
directly or indirectly as a result of:

       

      (a)           any
payment of a LIBOR Loan on a date other than the last day of the Interest Period
for such Loan including, but not limited to acceleration of the Loans;
or

       

      (b)           any
failure by Borrower to borrow or convert a LIBOR Loan on the date for borrowing
or conversion specified in the relevant notice under Section 8.1,
or

       

      (c)           any
failure by Borrower to pay a LIBOR Loan on any date for payment specified in
Borrower’s written notice of intention to pay such LIBOR Loan, or

       

      (d)           other
event pursuant to which a LIBOR Loan is converted to a Base Rate
Loan.

       

      8.8          Administrative
Expenses.  Borrower shall pay any reasonable fees, expenses and
disbursements, including reasonable legal fees, of the Lender related to this
Agreement, the Obligations, the perfection and protection of any collateral
security required hereunder, the transactions contemplated by this Agreement,
and the administration of this Agreement and the Obligations.  Such
payments shall be due on the Closing Date and thereafter as incurred by the
Lender.

       

      8.9          Collection
Costs.  At the request of the Lender, Borrower shall promptly
pay any reasonable fees, expenses and disbursements, including reasonable legal
fees, of the Lender in connection with collection of any of the Obligations or
enforcement of any of the Lender’s rights hereunder or under the Loan
Documents.  This obligation shall survive the payment of any Notes
executed hereunder.  The Lender may apply any payments of any nature
received by it first to the payment of Obligations under this Section 8.9,
notwithstanding any conflicting provision contained in this Agreement or any
other agreement with the Borrower.

       

      8.10        Default Interest
Rate.  Upon the occurrence of an Event of Default,
notwithstanding anything else herein, the rate of interest on each of the
Obligations shall be automatically increased to a rate at all times equal to
three percentage points (3%) above the rate of interest otherwise in effect,
such increased rate and fees to remain in effect through and including the
satisfaction and payment in full of all of the Obligations and the termination
of the Commitment, or written waiver of such Event of Default by the
Lender.

       

      8.11        Late Payment
Fees.  Payments of principal and/or interest not made in full
before the date five (5) Business Days after the date due shall be subject to a
processing charge of five percent (5%) of the payment due.


      
        
           


        

        
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      8.12        Payment of
Fees.  Borrower hereby authorizes the Lender to withdraw an
amount equal to the fees which are due and payable hereunder from any of its
accounts with the Lender if not paid on the due date for such
fees.  The Lender shall advise the Borrower of any such withdrawals,
provided, however, that failure by the Lender to give the Borrower such advice
shall not prevent the Lender from making any such withdrawals under this Section
8.12.

       

      8.13        Prepayments.

       

      (a)           LIBOR
Loans are prepayable only at the end of the respective applicable Interest
Periods, and Breakage Costs will apply to any payment of principal for any
reason during an applicable Interest Period, including without limitation by
reason of acceleration.  Prepayments of Fixed Rate Loans are subject
to payment of the Prepayment Premium.  Prepayments of Base Rate Loans
may be made without premium or penalty.

       

      (b)           The
Lender reserves the right to require advance notice for all prepayments of
Loans.

       

      (c)           Voluntary
principal prepayments of the 2008 Term Loan, GTC Term Loan, and Mortgage Secured
Term Loan, respectively, must be in minimum amounts of $500,000
each.

       

      (d)           Mandatory
principal prepayments of first the 2008 Term Loan, then the GTC Term Loan, then
the Mortgage Secured Term Loan, and then any Equipment Line Loans shall be made
within five Business Days after the date received by any Credit Party of and in
an amount equal to (i) one hundred percent (100%) of Net Cash Proceeds of any
Asset Disposition outside of the ordinary course of business if the aggregate
Net Cash Proceeds exceed $100,000 (cumulatively and in the aggregate), and (ii)
one hundred percent (100%) of the Net Cash Proceeds from any Casualty
Event.  In the event of a mandatory prepayment, the Lender will waive
any Prepayment Premium related to such prepayment of any Fixed Rate
Loan.

       

      (e)           Mandatory
principal prepayments, each equal to fifty percent (50%) of Excess Cash Flow for
the Fiscal Year last ended, shall be made within ninety (90) days after the end
of each Fiscal Year, and shall be applied first to the GTC Term Loan, and then
to the Mortgage Secured Term Loan.

       

      (f)           Prepayments
of the 2008 Term Loan, GTC Term Loan, Mortgage Secured Term Loan and Equipment
Line Notes shall be applied to the principal installments in the inverse order
of their maturities.

       

      (g)           If
by reason of an Event of Default the Lender elects to declare the Obligations to
be immediately due and payable and/or to reduce or terminate the Commitment,
then any Breakage Costs and the Prepayment Premium shall become due and payable
in the same manner as though the Borrower had voluntarily prepaid the
Notes.

       

      8.14        Obligations Related to Rate
Management Transactions.  In the event that the Borrower enters
into any Rate Management Transaction with the Lender, any costs incurred by the
Lender or its affiliates in connection therewith, including any interest,
expenses, fees, premiums, penalties or other charges associated with any
obligations undertaken by the Lender or its Affiliates to hedge or offset the
Lender’s or its affiliates obligations pursuant to such agreement, or the
termination of any such obligations, shall be deemed additional interest and/or
a related expense (to be determined in the sole discretion of the Lender) and
due as part of the Obligations and secured by all collateral for and covered by
all guarantees of the Obligations to the full extent thereof, and included in
any judgment in any proceeding instituted by the Lender.


      
        
           


        

        
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      8.15        Payments Due on Non-Business
Days.  Whenever any payment to be made under this Agreement or
under the Notes shall be stated to be due on a day other than a Business Day,
such payments shall be made on the next succeeding Business Day, and such
extension of time shall be included in the computation of the payment of
interest and the commitment fee, as the case may be, except, in the case of a
LIBOR Loan, if the result of such extension would be to extend such payment into
another calendar month, such payment shall be made on the immediately preceding
LIBOR Business Day.

       

      ARTICLE 9
- REPRESENTATIONS OF BORROWER

       

      The
Borrower represents and warrants to the Lender as follows:

       

      9.1          Organization and
Power.

       

      (a)           Each
of the Credit Parties is duly organized, validly existing and in good standing
under the laws of its state of incorporation and is duly qualified to transact
business and in good standing in all other states and jurisdictions in which it
is required to qualify or in which failure to qualify could have a Material
Adverse Effect.  The jurisdictions of formation and qualification for
each of the Credit Parties are described in Schedule
9.1.

       

      (b)           Each
of the Credit Parties has full power and authority to own its properties, to
carry on its business as now being conducted, to execute, deliver and perform
the Agreement and all related documents and instruments, and to consummate the
transactions contemplated hereby.

       

      9.2          Proceedings of
Borrower.

       

      (a)           All
necessary action on the part of the Credit Parties relating to authorization of
the execution and delivery of this Agreement and all related documents and
instruments, and the performance of the Obligations of the Credit Parties,
hereunder and thereunder has been taken.  This Agreement and all
related documents and instruments constitute legal, valid and binding
obligations of the Credit Parties, as applicable, enforceable in accordance with
their respective terms.

       

      (b)           The
execution and delivery by the Borrower of this Agreement and all related
documents and agreements, and the performance by each of the Credit Parties of
their respective obligations under this Agreement, the Security Documents and
all related documents and agreements will not violate any provision of law or
their respective Organization Documents.  The execution, delivery and
performance of this Agreement, the Security Documents and all related documents
and agreements, and the consummation of the transactions contemplated hereby
will not violate, be in conflict with, result in a breach of, or constitute a
default under any agreement to which any of the Credit Parties is a party or by
which any of its properties is bound, or any order, writ, injunction, or decree
of any court or governmental instrumentality, and will not result in the
creation or imposition of any lien, charge or encumbrance upon any of its
properties, and do not require the consent or approval of any governmental
authority.


      
        
           


        

        
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      9.3          Approvals.  No
order, consent, approval, license, authorization or validation of, or filing,
recording or registration with (except for those that have otherwise been
obtained or made on or prior to the date of this Agreement or as otherwise
required hereby and which remain in full force and effect on the date of this
Agreement), or exemption by, any Governmental Authority, is required to be
obtained or made by, or on behalf of, any Credit Party to authorize, or is
required to be obtained or made by, or on behalf of, any Credit Party in
connection with, the execution, delivery and performance of any Loan Document or
the legality, validity, binding effect or enforceability of any such Loan
Document.

       

      9.4          Capitalization.  All
of the outstanding Capital Securities of Borrower are duly authorized, validly
issued and fully paid.  All of the Capital Securities of each of
Borrower’s Subsidiaries are owned by Borrower or a Subsidiary of
Borrower.

       

      9.5          Litigation.  Except
as set forth on Schedule 9.5, as of
the date hereof there is no action, suit or proceeding at law or in equity by or
before any court or any federal, state, municipal or other governmental
department, commission, board, bureau, instrumentality or other agency, domestic
or foreign, pending or, to the knowledge of the Credit Parties, threatened
against or affecting the Credit Parties that brings into question the legality,
validity or enforceability of this Agreement or the transactions contemplated
hereby or that, if adversely determined, is not adequately covered by insurance
and would have a Material Adverse Effect.

       

      9.6          Financial Statements and
Condition.

       

      (a)           The
audited consolidated balance sheets of Borrower as of the Fiscal Year ended
September 30, 2009, and the related statements of operation, stockholders equity
and cash flows (including supporting footnote disclosures) for the Fiscal Years
then ended, with the opinion of EFP Rotenberg, all heretofore furnished to the
Lender, have been prepared in accordance with GAAP consistently applied
throughout the periods indicated, are all true and correct in all material
respects and present fairly the financial condition of IEC and IECW&C at the
date of said financial statements and the results of operations for the Fiscal
Year then ended.  The internally prepared balance sheet of GTC for the
Fiscal Year-to-date and October, 2009 Fiscal Month end, and the related
statements of operation, stockholders equity and cash flows for the periods then
ended, all heretofore furnished to the Lender, have been prepared in accordance
with GAAP (absent footnote disclosures and customary year end adjustments)
consistently applied throughout the periods indicated, are all true and correct
in all material respects and present fairly the financial condition of GTC at
the date of said financial statements and the results of GTC operations for the
fiscal period then ending.  The internally prepared balance sheet for
the Credit Parties as of the October, 2009 Fiscal Month end is true and correct
in all material respects and fairly represents the information therein
applicable to the Closing Date Borrowing Base Certificate of the Credit
Parties.  The financial statements described in this Section 9.6 are
collectively called the “Financial
Statements”.  The Credit Parties as of such dates did not have
any significant liabilities, contingent or otherwise, including liabilities for
taxes or any unusual forward or long-term commitments which were not disclosed
by or reserved against in the Financial Statements, and at the present time
there are no material unrealized or anticipated losses from any unfavorable
commitments of the Credit Parties.


      
        
           


        

        
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      (b)           On
and as of the date of this Agreement, and after giving effect to all Debt
(including the Loans) and Liens created by the Credit Parties in connection
therewith and the GTC Transaction, (i) the sum of the assets, at a fair
valuation, of the Borrower (standing alone) and the Credit Parties (taken as a
whole) will exceed its and their debts, (ii) the Borrower (standing alone) and
the Credit Parties (taken as a whole) has and have not incurred and does or do
not intend to incur, and does or do not believe that it or they will incur,
debts beyond its or their ability to pay such debts as such debts mature, and
(iii) the Borrower (standing alone) and the Credit Parties (taken as a whole)
will have sufficient capital with which to conduct its and their respective
businesses.  For purposes of this Section 9.6(b), “debt” means any
liability on a claim, and “claim” means (i) right to payment, whether or not
such a right is reduced to judgment, liquidated, unliquidated, fixed,
contingent, matured, unmatured, legal, equitable, secured, or unsecured or (ii)
right to an equitable remedy for breach of performance if such breach gives rise
to a payment, whether or not such right to an equitable remedy is reduced to
judgment, fixed, contingent, matured, unmatured, secured or
unsecured.  The amount of contingent liabilities at any time shall be
computed as the amount that, in the light of all the facts and circumstances
existing at such time, represents the amount that can reasonably be expected to
become an actual or matured liability.

       

      9.7          Material Adverse
Changes.  As of the date of this Agreement, since the
respective dates of the Financial Statements there has been no Material Adverse
Effect, except for changes disclosed prior to the date of this Agreement by the
Borrower either (i) in writing to the Lender or (ii) in the Borrower’s filings
with the Securities and Exchange Commission.

       

      9.8          Taxes.  Each
of the Credit Parties have filed or caused to be filed when due all federal tax
returns or extensions and all state and local tax returns or extensions that are
required to be filed, and have paid or caused to be paid all Taxes as shown on
said returns or any assessment received.  The filed returns accurately
reflect in all material respects all liability for Taxes of the Credit Parties,
as applicable, for the periods covered thereby.  Each of the Credit
Parties has paid all material Taxes payable by it which have become due, other
than those that are being contested in good faith and adequately disclosed and
fully provided for on the consolidated financial statements of the Credit
Parties in accordance with GAAP.  None of the Credit Parties’ tax
returns are being audited on the date of this Agreement and none of the Credit
Parties have been notified of any intention by any taxing authority to conduct
such an audit.

       

      9.9          Properties;
Liens.  Except as would not have a Material Adverse Effect, (a)
the Credit Parties have good and marketable title to all of their properties and
assets, including without limitation, the properties and assets reflected in the
Financial Statements free and clear of all Liens, except for Permitted Liens,
and (b) the Credit Parties have a valid leasehold estate and undisturbed
peaceable possession under all leases under which they are operating, all of
which are in full force and effect and none of which contain unusual or
burdensome provisions that may materially adversely affect the operations of the
Credit Parties.

       

      9.10        Debt.  Except
for Permitted Debt, the Credit Parties have no outstanding
Debt.


      
        
           


        

        
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      9.11        Franchises;
Permits.  Each of the Credit Parties has obtained and is in
compliance with all licenses, permits, franchises, and governmental
authorizations necessary for the ownership of its properties and the conduct of
its business, for which failure to comply could reasonably be expected to have a
Material Adverse Effect.

       

      9.12        Compliance With
Law.

       

      (a)           None
of the Credit Parties is in violation of any laws, ordinances, governmental
rules, requirements, or regulations, or any order, writ, injunction or decree of
any court or federal, state, municipal or other governmental department,
commission, board, bureau, agency or instrumentality, domestic or foreign, to
which it is subject which violation could reasonably be expected to have a
Material Adverse Effect.

       

      (b)           To
the extent applicable, each of the Credit Parties is in compliance with the (i)
Trading with the Enemy Act, as amended, and each of the foreign assets control
regulations of the United States Treasury Department (31 CFR, Subtitle B,
Chapter V, as amended) and any other enabling legislation or executive order
relating thereto, and (ii) the Patriot Act, except in each case such
noncompliances as could not, either individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect.

       

      (c)           Neither
the Borrower nor any of the Credit Parties, nor, to the knowledge of the
Borrower, any director, officer, agent, employee (whether full time or
contract), representative or other person acting on behalf of the Credit Parties
has, in the course of its actions for, or on behalf of, the Credit Parties, (i)
used any corporate funds for any unlawful contribution, gift, entertainment or
other unlawful expenses relating to political activity, (ii) made any direct or
indirect unlawful payment to any foreign or domestic government Person or
employee (whether full time or contract) from corporate funds, (iii) violated or
is in violation of any provision of the U.S. Foreign Corrupt Practices Act of
1977, as amended, or (iv) made any unlawful bribe, rebate, payoff, influence
payment, kickback or other unlawful payment to any foreign or domestic
government Person or employee (whether full time or contract).

       

      9.13        Intellectual Property;
Authorizations.  The Credit Parties own, possess or have
licenses for all of the patents, trademarks, service marks, trade names,
copyrights, licenses, authorizations, trade secrets, proprietary information and
know-how, and all rights with respect to the foregoing (collectively, the “Intellectual Property”),
necessary to the conduct of their business as now conducted.  A
complete list of all such Intellectual Property with respect to which
registrations have been issued by the U.S. Patent and Trademark Office, the U.S.
Copyright Office, or any comparable foregoing governmental authority is set
forth on the Schedule
9.13.  Except as disclosed in Schedule 9.5, to the
knowledge of the Credit Parties, no product, process, method, substance, part or
other material presently contemplated to be sold by or employed by any of the
Credit Parties in connection with its business infringes or may infringe any
patent, trademark, service mark, trade name, copyright, license or other right
owned by any other person.  Except as disclosed in Schedule 9.5, there
is no pending or threatened claim or litigation against or affecting any of the
Credit Parties contesting its right to sell or use any such product, process,
method, substance, part or other material.  There is no pending or
proposed any patent, invention, device application or principle or any statute,
law, rule, regulation, standard or code which would prevent, inhibit or render
obsolete the production or sale of any products of, or substantially reduce the
projected revenues of or otherwise have a Material Adverse
Effect.


      
        
           


        

        
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      9.14        Contracts and
Agreements.  None of the Credit Parties is a party to any
contract or agreement that has or could reasonably be expected to have a
Material Adverse Effect, and each the Credit Parties is in compliance in all
material respects with all material contracts and agreements to which it is a
party.

       

      9.15        Subsidiaries and
Affiliates.  Except Affiliates and Subsidiaries listed on Schedule 9.15 and
Subsidiaries permitted by Section 12.10 below, Borrower has no Subsidiaries or
Affiliates.  The jurisdiction of formation and ownership of each of
the Subsidiaries listed on Schedule 9.15 is set
forth on such Schedule.

       

      9.16        Governmental
Contracts.

       

      (a)           None
of the Credit Parties has knowledge of (i) an existing Organizational Conflict
of Interest, as defined by the Federal Acquisition Regulation (“FAR”) 2.101, that has not
been resolved through an appropriate mitigation plan or (ii) circumstances that
could be reasonably likely to negatively affect in any material respects the
Credit Parties’ ability to be awarded government contracts similar to those
which the any of the Credit Parties is currently performing.

       

      (b)           None
of the Credit Parties has knowledge of any payment by any Credit Parties to any
Person in connection with any material government contract made in violation of
applicable procurement statutes, regulations or the provisions of any of the
Credit Parties’ material government contracts.

       

      (c)           With
respect to each government contract to which any of the Credit Parties is a
party or bound, (i) neither the United States Government nor any prime
contractor, subcontractor or other Person has notified any of the Credit
Parties, in writing or otherwise, that any of the Credit Parties has breached or
violated any requirement of law, or material certificate or representation, or
any clause which has resulted in a cure notice which in each case, either
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect and (ii) solely with respect to material government
contracts, no termination for default is currently in effect pertaining to any
such material government contract.

       

      (d)           (i)
Neither any of the Credit Parties or any of their respective directors or
officers is (or during the last five (5) years has been) under civil
investigation by the United States Department of Justice or a state attorney
general or under criminal investigation by any Governmental Authority, or is
under indictment by any Governmental Authority with respect to any irregularity,
misstatement or omission arising under or relating to any activities of the
Credit Parties under a government contract and (ii) during the last five (5)
years, none of the Credit Parties has made a voluntary disclosure to the United
States Government with respect to any irregularity, misstatement or omission
arising under or relating to a government contract, except, in each case, for
any such investigation, indictment, voluntary disclosure, irregularity,
misstatement or omission which, either individually or in the aggregate, could
not reasonably be expected to have a Material Adverse Effect.


      
        
           


        

        
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      (e)           There
exist (i) no outstanding material claims against the Credit Parties, either by
the United States Government or by any prime contractors, subcontractor, vendor
or other third party, arising under or relating to any government contract and
(ii) no disputes between the any of the Credit Parties and the United States
Government under the Contract Disputes Act or any other Federal statute or
between any of the Credit Parties and any prime contractor, subcontractor or
vendor arising under or relating to any government contract, which, either
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect.

       

      (f)           None
of the Credit Parties or any of their respective directors, officers, owners,
partners, or to the knowledge of the foregoing, employees, is (or during the
last five (5) years has been) suspended or debarred from doing business with the
United States Government or is (or during such period was) the subject of a
finding of non-responsibility or ineligibility for United States Government
contracting.

       

      (g)           No
notice of suspension, debarment, cure notice, show cause notice or notice of
termination for default is in effect which, either individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect
has been issued by the United States Government to any of the Credit Parties and
none of the Credit Parties is a party to any pending, or to the Borrower’s
knowledge threatened, suspension, debarment, termination for default issued by
the United States Government or other adverse United States Government action or
proceeding in connection with any contract with the United States Government
which, either individually or in the aggregate, could reasonably be expected to
result in a Material Adverse Effect.

       

      (h)           No
cost incurred pertaining to any government contract of any of the Credit Parties
has been disallowed by the United States Government or any of its agencies or,
to the knowledge of any of the Credit Parties, is the subject of any
investigation or which, either individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect.

       

      (i)           On
the date hereof the cost accounting systems and government property management
systems with respect to the material government contracts of the Credit Parties
comply in all material respects with the applicable cost accounting standards
set forth in FAR Sections 30 and 45 respectively.

       

      9.17        ERISA.  Except
as set forth on the Schedule 9.17:

       

      (a)           Identification of
Plans.  (i) Neither any Credit Party, nor any ERISA Affiliate,
maintains or contributes to, or has maintained or contributed to, any Plan that
is an ERISA Plan, and (ii) none of the Credit Parties and their ERISA Affiliates
maintains or contributes to, or have maintained or contributed to, any Plan that
is an Executive Arrangement.

       

      (b)           Compliance.  Each
Plan has at all times been maintained, by its terms and in operation, in
accordance with all applicable laws, except such noncompliance (when taken as a
whole) that will not have a Material Adverse Effect.


      
        
           


        

        
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      (c)           Liabilities.  Neither
any of the Credit Parties, nor any ERISA Affiliate, is currently, and has not
been obligated in the last six (6) years to make contributions (directly or
indirectly) to a Multiemployer Plan, and nor is currently subject to any
liability (including withdrawal liability), tax or penalty whatsoever to any
person whomsoever with respect to any Plan including, but not limited to, any
tax, penalty or liability arising under Title I or Title IV or ERISA or Chapter
43 of the Internal Revenue Code, except such liabilities (when taken as a whole)
as will not have a Material Adverse Effect.

       

      (d)           Funding.  Each
Credit Party and each ERISA Affiliate have made full and timely payment of all
amounts (i) required to be contributed under the terms of each Plan and
applicable law and (ii) required to be paid as expenses of each
Plan.  No Plan has an “amount of unfunded benefit liabilities” (as
defined in Section 4001(a)(18) of ERISA).

       

      9.18        Employment and Labor
Relations.  None of the Credit Parties is engaged in any unfair
labor practice that could reasonably be expected, either individually or in the
aggregate, to have a Material Adverse Effect.  There is (i) no unfair
labor practice complaint pending against and of the Credit Parties or, to the
knowledge of the Borrower, threatened against any of them, before the National
Labor Relations Board, and no grievance or arbitration proceeding arising out of
or under any collective bargaining agreement is so pending against any of the
Credit Parties or, to the knowledge of the Borrower, threatened against any of
them, (ii) no strike, labor dispute, slowdown or stoppage pending against any of
the Credit Parties or, to the knowledge of the Borrower, threatened against any
of the Credit Parties, (iii) no union representation question exists with
respect to the employees of any of the Credit Parties, (iv) no equal employment
opportunity charges or other claims of employment discrimination are pending or,
to the Borrower’s knowledge, threatened against any of the Credit Parties, (v)
no wage and hour department investigation has been made of any of the Credit
Parties, except (with respect to any matter specified in clauses (i) through (v)
above, either individually or in the aggregate) such as could not reasonably be
expected to have a Material Adverse Effect, and (vi) the Credit Parties have in
place all current affirmative action plans applicable to their respective
business operations and are in material compliance with all laws and regulations
governing such affirmative action plans, including, without limitation,
compliance with the terms set forth in such plans.

       

      9.19        Security
Documents.  The Security Documents are effective to create in
favor of the Lender legal, valid and enforceable (subject to bankruptcy and
creditors’ rights generally) security interests in all non-real estate property
and assets of the Credit Parties, all of which are part of the
Collateral.  When (i) financing statements in appropriate form are
filed in the applicable offices required by the Uniform Commercial Code and (ii)
upon the taking of possession or control by the Lender of any Collateral in
which a security interest may be perfected only by possession or control (which
possession or control shall be given to the Lender to the extent possession or
control by the Lender is required by the Security Documents), the Lender shall
have a fully perfected first priority Lien on, and security interest in, all
right, title and interest of the Credit Parties in the Collateral to the extent
such Lien and security interest can be perfected by the filing of a financing
statement pursuant to the UCC or by possession or control by the Lender, in each
case prior and superior in right to any other Person, other than any holder of
Permitted Liens.  Without limitation to the foregoing, no consent of
any Person including any other general or limited partner, any other member of a
limited liability company, any other shareholder or any other trust beneficiary
is necessary in connection with the creation, perfection or first priority
status of the security interest of the Lender in any equity interests pledged to
the Lender under the Security Documents or the exercise by the Lender of the
voting or other rights provided for in the Security Documents or the exercise of
remedies in respect thereof.

       

      
        
          
          

        

        
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      9.20        Disclosure.  Neither
this Agreement, any Loan Document nor any other document, certificate or
statement furnished to the Lender by or on behalf of any Credit Party in
connection herewith contains any untrue statement of a material fact or omits to
state a material fact necessary in order to make the statements contained herein
and therein not misleading, if, in either case, such fact is material to an
understanding of the financial condition, performance or prospects of the Credit
Parties, taken as a whole or their business or operations, taken as a whole, or
the ability of the Credit Parties to fulfill their obligations under this
Agreement or by any Loan Documents to which they are parties.

       

      ARTICLE
10 - CONDITIONS OF LENDING

       

      10.1        Loans.  The
following conditions must be satisfied before the Lender shall have any
obligation to make Loans on the Closing Date under this Agreement:

       

      (a)           Performance.  Borrower
shall have performed and complied with all agreements and conditions required to
be performed or complied with by it prior to or at the time each Loan is
made.

       

      (b)           Opinion of
Counsel.  As of the Closing Date, the Credit Parties shall have
delivered a favorable opinion of their counsel, in form and substance
satisfactory to the Lender.

       

      (c)           Documents to be
Delivered.  Borrower shall have executed and delivered or have
caused to be executed and delivered to the Lender all Loan Documents in form and
substance satisfactory to Lender, and all Loan Documents shall be in full force
and effect.

       

      (d)           Certified
Resolutions.  As of the Closing Date the Borrower and
Guarantors shall have delivered a certificate of their respective corporate
secretaries certifying (i) resolutions duly adopted by their respective Boards
of Directors authorizing the execution, delivery and performance of the Loan
Documents to which each is a party and the consummation of the transactions
contemplated hereby and thereby, as applicable, which resolutions shall remain
in full force and effect so long as any of the Obligations are outstanding or
the Commitment has not been terminated, (ii) true and complete copies of their
respective Certificates of Incorporation and By-Laws and (iii) the incumbency of
their respective officers authorized to execute, deliver and perform this
Agreement or the Loan Documents, as applicable.

       

      (e)           Fees and
Taxes.  Borrower shall have paid all filing fees, taxes, and
assessments related to the borrowings and the perfection of any interests in
collateral security required hereunder.

       

      (f)           Insurance.  Borrower
shall have delivered evidence satisfactory to the Lender of the existence of
insurance required hereby, including evidence of property and liability
insurance required for GTC.


      
        
           


        

        
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      (g)           Other Documents and
Agreements.  On or before the date of this Agreement, the
Borrower shall have executed and/or delivered such other documents, instruments,
and agreements as the Lender and its legal counsel may reasonably require in
connection with the transactions contemplated hereby.

       

      (h)           Certificates of Good
Standing; Searches.  As of the Closing Date, Borrower shall
have delivered to the Lender (a) certificates of good standing from appropriate
state officials to the effect that Borrower and each Guarantor is in good
standing in the respective states of their incorporation as well as in all other
states in which qualification is necessary to carry on their businesses as
presently conducted and (b) UCC, judgment, bankruptcy and tax searches covering
Borrower and each Guarantor in all jurisdictions deemed necessary by the Lender,
the results of all of which shall be satisfactory to the Lender in all
respects.

       

      (i)    
       Representations.  The
representations and warranties of the Credit Parties contained herein shall be
true and correct in all material respects.

       

      (j)       
    Consents and
Approvals.  The Lender shall have received evidence of receipt
of all governmental, shareholder and other, if any, consents and approvals
necessary in connection with the related financings and other transactions
contemplated under this Agreement, except where the failure to obtain such
consents or approvals would not, individually or in the aggregate, have a
Material Adverse Effect.

       

      (k)           Litigation.  The
Lender shall have been informed of any suit, investigation or proceeding pending
in any court or before any arbitrator or governmental authority that would
reasonably be expected either to have a Material Adverse Effect or to materially
adversely affect the ability of any of the Credit Parties to perform its
respective obligations under this Agreement, and no such suits, investigations,
or proceedings shall be pending.

       

      (l)    
       Patriot
Act.  To the extent applicable, each Credit Party is in
compliance, in all material respects, with the (i) Trading with the Enemy Act,
as amended, and each of the foreign assets control regulations of the United
States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) and any
other enabling legislation or executive order relating thereto, and (ii) Uniting
and Strengthening America by Providing Appropriate Tools Required to Intercept
and Obstruct Terrorism (USA Patriot Act of 2001).  To the knowledge of
the Borrower, no part of the proceeds of the Loans will be used, directly or
indirectly, for any payments to any governmental official or employee, political
party, official of a political party, candidate for political office, or anyone
else acting in an official capacity, in order to obtain, retain or direct
business or obtain any improper advantage, in violation of the United States
Foreign Corrupt Practices Act of 1977, as amended.

       

      (m)          Minimum Borrowing
Capacity.  The Lender shall have received evidence satisfactory
to it that Borrower has at least $2,000,000 of remaining availability under the
Borrowing Base after the Revolving Credit Loans to be made on the Closing
Date.

       

      (n)           Landlord
Waivers.  The Lender shall have received a waiver in form and
substance satisfactory to Lender from each landlord of premises on which the
Lender’s collateral is located and that is not owned by a Credit Party, except
that no waiver shall be required from the City of Albuquerque, New
Mexico.


      
        
           


        

        
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      (o)          GTC
Transactions.  On or before the Closing Date, the Lender shall
have reviewed and approved the final form, substance, terms, and conditions of
the GTC Transaction and the Stock Purchase Agreement related thereto, including
the Lender’s review and satisfaction with the proposed organizational and legal
structure, tax assumptions, final projections, purchase allocation, accounting,
due diligence, legal opinions, and other related matters.

       

      (p)          Field
Audit.  On or before the Closing Date, the Lender shall have
received the results of a field audit of GTC’s assets and operations performed
at Borrower’s expense, the results of which must be satisfactory to
Lender.

       

      (q)          Mortgage.  On
or before the Closing Date the Lender shall have received the following with
respect to the Mortgaged Property:

       

      (i)           the
Mortgage securing the face amount of $8,000,000, in form satisfactory to the
Lender, covering the leasehold interest of GTC in the Mortgaged
Property,

       

      (ii)          an
appraisal, in form satisfactory to the Lender showing a market value of the
Mortgaged Property of at least $5,333,333,

       

      (iii)         a
mortgagee title insurance policy covering the Mortgaged Property, in form and
substance satisfactory to Lender,

       

      (iv)      
  an Environmental Report prepared for Lender covering the Mortgaged
Property, with results satisfactory to Lender,

       

      (v)          evidence
satisfactory to Lender of payment of all taxes and assessments related to the
Mortgaged Property that are currently due,

       

      (vi)         a
certification that the Mortgaged Property is not located in a flood hazard area,
or if it is so located, flood hazard insurance covering the same,

       

      (vii)        arrangements
satisfactory to the Lender with the seller in the GTC Transaction related to
discharge or assignment of the BOA Mortgage as more specifically described in
Section 11.14(d), and

       

      (viii)       assurances
satisfactory to the Lender of matters related to New Mexico law from New Mexico
legal counsel.

       

      (r)           No Material Adverse
Effect.  There has been no Material Adverse Effect with respect
to the Credit Parties, including GTC.

       

      10.2        Subsequent Loans and Letters
of Credit.  The obligation of the Lender to make any Revolving
Credit Loans or Equipment Line Loans shall at all times be subject to the
following continuing conditions:


      
        
           


        

        
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      (a)           Representations and
Warranties.  The representations and warranties of the Credit
Parties contained herein shall be true and correct in all material respects as
of the date of making of each such advance (except those which are specific as
to a date certain), with the same effect as if made on and as of such
date.

       

      (b)           No Material Adverse
Effect.  Since the date of this Agreement, there has been no
Material Adverse Effect.

       

      (c)           No
Defaults.  There shall exist no Default or Event of Default at
the time each Loan is to be made.

       

      10.3        Notice of Borrowing
Representation.  Each Notice of Borrowing given by a Borrower
in accordance with Section 8.1 hereof and the acceptance by Borrower of the
proceeds of a Revolving Credit Loan and/or Equipment Line Loan shall constitute
a representation and warranty by the Borrower, made as of the time of the making
of such Loan, that the conditions specified in Sections 10.1 and 10.2 have been
fulfilled as of such time.

       

      ARTICLE
11 - AFFIRMATIVE COVENANTS OF BORROWER

       

      So long
as any Obligations shall be outstanding, the Commitment shall be in effect, or
this Agreement remains in effect, unless the Lender otherwise consents in
writing, the Credit Parties shall:

       

      11.1        Financial Statements; Other
Information.

       

      (a)           Furnish
to the Lender as soon as available, but in no event later than ninety (90) days
after the close of each Fiscal Year in which this Agreement remains in effect,
copies of annual consolidated financial statements of the Borrower in reasonable
detail satisfactory to the Lender prepared in accordance with GAAP on a
consistent basis audited by and with an unqualified opinion from an independent
certified public accountant satisfactory to the Lender.  Said
financial statements shall include at least a consolidated and consolidating
balance sheet and consolidated and consolidating statements of operations,
stockholder’s equity and cash flow, and shall be accompanied by a copy of any
management letter prepared by such accountants.  Such financial
statements shall be accompanied by a certificate of the Chief Financial Officer
of Borrower to the effect that no Event of Default or Default has
occurred.

       

      (b)           Furnish
to the Lender unaudited financial statements not more than forty-five (45) days
after the close of each Fiscal Quarter.  Said statements shall be in
reasonable detail satisfactory to the Lender, shall be prepared in accordance
with GAAP, shall include at least a consolidated and consolidating balance sheet
and a consolidated and consolidating statements of operations, stockholder’s
equity and cash flow.  Said financial statements shall be certified to
be true and correct to the best knowledge of the Chief Financial Officer of
Borrower.  Such financial statements shall be accompanied by a
certificate of the Chief Financial Officer of Borrower to the effect that no
Event of Default or Default has occurred.


      
        
           


        

        
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      (c)           Furnish
to the Lender unaudited financial statements not more than forty-five (45) days
after the close of each Fiscal Month.  Said statements shall be in
reasonable detail satisfactory to the Lender, shall be prepared in accordance
with GAAP, shall include at least a consolidated and consolidating balance sheet
and a consolidated and consolidating statements of operations, stockholder’s
equity and cash flow.  Said financial statements shall be certified to
be true and correct to the best knowledge of the Chief Financial Officer of
Borrower.  Such financial statements shall be accompanied by a
certificate of the Chief Financial Officer of Borrower to the effect that no
Event of Default or Default has occurred.

       

      (d)           Provide
to the Lender weekly borrowing base reports (“Borrowing Base Reports”), in
substantially the form of Exhibit G attached
hereto, each accompanied by an accounts receivable aging, accounts payable
aging, and inventory report.  After giving thirty (30) days prior
notice to Lender, Borrower may provide Borrowing Base Reports on a monthly
rather than weekly basis; provided, however, at any time the unused availability
under the Borrowing Base is less than $2,000,000, weekly Borrowing Base Reports
must be provided.

       

      (e)           Provide
to the Lender an annual operating budget for the Credit Parties, including a
balance sheet, statement of operations, and cash flow statement, with supporting
assumptions, in detail reasonably satisfactory to Lender, within thirty (30)
days after the end of each Fiscal Year of Borrower.

       

      (f)           Permit
the Lender to perform full field audits of the Credit Parties’ accounts
receivable and inventories at Borrower’s expense.

       

      (g)           Furnish
to the Lender such additional information, reports, or financial statements as
the Lender may, from time to time, reasonably request, including, without
limitation, lists of vendors and suppliers and information necessary to monitor
Revolving Loans.

       

      (h)           Permit
any Person designated by the Lender to inspect the property, assets and books of
the Credit Parties at reasonable times and, prior to an Event of Default, upon
reasonable notice, and shall discuss their affairs, finances and accounts at
reasonable times with the Lender from time to time as often as may be reasonably
requested.

       

      (i)           Notify
the Lender promptly upon addition of any new location at which it conducts
business or maintains assets, and of any new warehousing or distributorship
agreement.

       

      (j)           Report
immediately to the Lender in writing upon becoming aware of any noncompliance
with any covenant in this Agreement or any Default, including without limitation
becoming aware of any noncompliance with Article 13 in advance of the date on
which the corresponding quarterly financial statements are due to be delivered
to the Lender.

       

      11.2        SEC
Reports.  Furnish to the Lender, as applicable, copies of all
proxy statements, financial statements and reports which Borrower sends to its
stockholders, and copies of all regular, periodic and current reports, and all
comment letters and responses thereto, which Borrower files with the Securities
and Exchange Commission (“SEC”) or any governmental
authority which may be substituted therefore, or with any national securities
exchange; provided, however, in lieu of such copies Borrower may advise Lender
in writing (including by fax of email) that any such proxy statement, financial
statement and report, as the case may be, is available on the SEC’s Edgar
database.


      
        
           


        

        
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      11.3        Taxes.  Pay
and discharge all taxes, assessments, levies and governmental charges upon the
Credit Parties, their income and property, prior to the date on which penalties
are attached thereto; provided, however, that the Credit Parties may in good
faith contest any such taxes, assessments, levies or charges so long as such
contest is diligently pursued and no lien or execution exists or is levied
against any of the Credit Parties’ assets related to the contested
items.

       

      11.4        Insurance.  Maintain
or cause to be maintained insurance, of kinds and in amounts reasonably
satisfactory to the Lender, with responsible insurance companies on all of the
Credit Parties’ real and personal properties in such amounts and against such
risks as are prudent, including, but not limited to, full-risk extended coverage
hazard insurance to the full insurable value of real property (co-insurance not
being permitted without the prior written consent of the Lender), all-risk
coverage for personal property, business interruption or loss of rents coverage,
worker’s compensation insurance, and comprehensive general liability and
products liability insurance.  The Credit Parties also shall maintain
flood insurance covering any real properties located in flood
zones.  The Credit Parties shall provide to the Lender, no less often
than annually and upon its request, a detailed list and evidence satisfactory to
the Lender of their insurance carriers and coverage and shall obtain such
additional insurance as the Lender may reasonably request.  Insurance
policies shall name the Lender as additional insured, as its interests may
appear, and all policies shall provide for at least thirty (30) days prior
notice of cancellation to the Lender.

       

      11.5        Maintenance of Business
Assets.  At all times maintain, preserve, protect, and keep the
Credit Parties’ assets in good repair, working order, and condition and, from
time to time, make all needful and proper repairs, renewals, replacements,
betterments and improvements thereto, so that the business of the Credit Parties
may be properly and advantageously conducted at all times and the value of the
Lender’s collateral shall be preserved.

       

      11.6        Notification of Material
Changes, Judgments etc.  Notify the Lender promptly
of:

       

      (a)           any
material adverse change in the financial condition of any of the Credit Parties,
and of any event, circumstance, or condition that has had or could reasonably be
expected to have a Material Adverse Effect, including the filing of any suits,
judgments or liens which, if adversely determined, could reasonably be expected
to have a Material Adverse Effect,

       

      (b)           the
existence of any Default of which a Credit Party has actual knowledge,
and

       

      (c)           the
filing of any patent, trademark, or copyright registrations by any Credit
Party.

       

      11.7        ERISA
Compliance.  Comply in all material respects with the
provisions of ERISA and regulations and interpretations related thereto with
respect to all of the Credit Parties’ Plans.

       

      11.8        Franchises; Permits;
Laws.  Preserve and keep in full force and effect the existence
of the Credit Parties and all franchises, permits, licenses and other authority
as are necessary to enable them to conduct their businesses as being conducted
on the date of this Agreement, and comply in all material respects with all
laws, regulations and requirements now in effect or hereafter promulgated by any
properly constituted governmental authority having jurisdiction over
them.


      
        
           


        

        
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      11.9        Performance of
Obligations.  The Borrower will, and will cause each of the
Credit Parties to, perform all of its obligations under the terms of each
mortgage, indenture, security agreement, loan agreement or credit agreement and
each other agreement, contract or instrument by which it is bound (taking into
account any grace, notice, or cure periods applicable thereto), except in each
case such non-performances as could not, either individually or in the
aggregate, reasonably be expected to have a Material Adverse
Effect.

       

      11.10      Deposits; Bank
Services.  Maintain at the Lender all of the Credit Parties’
primary depository accounts, with exceptions permitted for accounts maintained
for convenience in other geographical locations for the temporary deposit of
receipts.

       

      11.11      Amendments.  Give
the Lender prompt written notice of an amendment or modification to any of the
Credit Parties’ Organizational Documents.

       

      11.12      Additional
Guarantors.  Notify the Lender of the acquisition or creation
of any new Subsidiary and cause each domestic Subsidiary created or acquired
after the Closing Date to execute and deliver to the Lender a continuing
guaranty, general security agreement, and other agreements in form and substance
satisfactory to Lender subjecting all of the assets of the Subsidiary to the
Lien held by the Lender, together with approvals and legal opinions in form and
substance satisfactory to the Lender opining to the authorization, validity and
enforceability of such Guaranty, and to such other matters at the Lender may
reasonably request.

       

      11.13      Further
Assurances.  Cooperate with the Lender and execute such further
instruments and documents as the Lender shall reasonably request to carry out
the transactions contemplated by this Agreement and the other Loan
Documents.

       

      11.14      Post-Closing
Deliveries.  Deliver to the Lender:

       

      (a)           on
or before January 29, 2010, (i) a consent to the Mortgage executed by the City
of Albuquerque, New Mexico (“City”) to the Mortgage, (ii)
a joinder agreement to the Mortgage, in form satisfactory to Lender, executed by
the City, subjecting the interest of the City in the Mortgaged Property, or
equivalent separate mortgage made by the City, (iii) a survey in form
satisfactory to the Lender certified to Lender and the title insurance company
covering the Mortgaged Property, sufficient that the title company will remove
any survey exception from the title insurance policy, (iv) evidence of recording
of a memorandum of lease covering the Lease Agreement between the City of
Albuquerque, New Mexico and GTC dated as of March 1, 1999, in form satisfactory
to the title insurance company, and (v) mortgagee title insurance policy, or
equivalent endorsement, in form satisfactory to the Lender covering the mortgage
made by the City of Albuquerque, New Mexico,

       

      (b)           on
or before January 29, 2010, a copy of the declaration page or endorsement to the
liability insurance policies of the Credit Parties showing the Lender has been
added as “Additional Insured” and showing 30 days notice of cancellation to the
Lender,


      
        
           


        

        
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      (c)           on
or before January 29, 2010 termination statements for all UCC financing
statements filed in New Mexico showing GTC as debtor, with the exception of
financing statements in favor of Lender as secured party, and

       

      (d)           on
or before January 29, 2010, evidence that either (i) the BOA Mortgage has been
discharged of record in the applicable records of Bernalillo County, New Mexico,
or (ii) evidence that an assignment of the Mortgage to the Crane Fund for Widows
and Children, holder of a $100,000 GTC bond, and a modification by the Crane
Fund for Widows and Children reducing the amount secured by the BOA Mortgage to
$100,000, have been recorded in the applicable records of Bernalillo County, New
Mexico.

       

      ARTICLE
12 - NEGATIVE COVENANTS OF BORROWER

       

      So long
as any Obligations shall be outstanding, the Commitment shall be in effect, or
this Agreement shall remain in effect, unless the Lender otherwise consents in
writing, none of the Credit Parties shall, directly or indirectly, jointly or
severally:

       

      12.1        Debt, Mortgages and
Liens.  Create, incur, assume or allow to exist, voluntarily or
involuntarily, any Debt or Liens, excluding only (a) Debt to and interests held
by the Lender under this Agreement, (b) Debt described in Schedule 12.1
attached hereto and made a part hereof, which Debt may not be renewed, extended,
amended or modified, (c) Permitted Liens, (d) Debt and interests to which the
Lender consents in writing, (e) Debt of Borrower to any Guarantor or of any
Guarantor to Borrower, and (f) debt to the sellers of IECW&C to Borrower,
covered by subordination agreements satisfactory to Lender.

       

      12.2        Loans and
Investments.  Make any Investment in any Person, or purchase or
own a futures contract or otherwise become liable for the purchase or sale of
currency or other commodities at a future date in the nature of a futures
contract, except for (i) Investments in any Person that is already a Credit
Party, (ii) Money Market Investments, and (iii) Investments received in
connection with the bankruptcy or reorganization of suppliers and customers and
in good faith settlement of delinquent obligations of, and other disputes with,
customers and suppliers arising in the ordinary course of business.

       

      12.3        Mergers, Dissolutions; Sales
and Acquisitions; Change in Ownership Interests.  Except for
the GTC Transaction, enter into any partnership, joint venture, merger or
consolidation, or wind up, liquidate, or dissolve its affairs, or enter into a
sale-leaseback except with Lender or its affiliates, or acquire all or
substantially all the Capital Securities or assets of any Person, or sell,
lease, transfer, or otherwise dispose of any its assets, except, for (a) (i)
dispositions of inventory in the ordinary course of business or (ii) the
disposition of any asset not material to the respective Credit Party or its
business and not exceeding $100,000 in value, and (b) the merger of Borrower
into any Guarantor or of any Guarantor into Borrower after giving written notice
to the Lender of the intended merger, so long as any security interests granted
to the Lender in the assets so transferred shall remain in full force and effect
and perfected (to at least the same extent as in effect immediately prior to
such transfer) and all actions required to maintain said perfected status have
been taken.


      
        
           


        

        
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      12.4        Amendments.  Allow
the amendment or modification of its Organizational Documents in any material
respect without the prior written consent of the Lender.

       

      12.5        Distributions.  Make
any Distributions, except Distributions from a Guarantor to Borrower, without
the prior consent of Lender.

       

      12.6        Material
Changes.  Permit any material change to be made in the
character of the business of any of the Credit Parties, or in the nature of
their operations as carried on at the date hereof.

       

      12.7        Compensation.  Compensate
any Person, including, without limitation, salaries, bonuses, consulting fees,
or otherwise, in excess of amounts reasonably related to services rendered to
the Credit Parties.

       

      12.8        Judgments.  Allow
to exist any judgment against any of the Credit Parties in excess of $250,000
which are not fully covered by insurance or for which an appeal or other
proceeding for the review thereof shall not have been taken and for which a stay
of execution pending such appeal shall not have been obtained.

       

      12.9        Margin
Securities.  Not, directly or indirectly, use any part of the
proceeds of the Obligations for the purpose of purchasing or carrying any margin
stock within the meaning of Regulation U of the Board of Governors of the
Federal Reserve System or to extend credit to any person for the purpose of
purchasing or carrying any such margin stock, or for any purpose which violates,
or is inconsistent with, Regulation X of such Board of Governors.

       

      12.10      Subsidiaries.

       

      (a)           Form,
or permit to be formed, any Subsidiary unless such Subsidiary guarantees all
Obligations to the Lender, which guarantee must be secured by all of its assets
pursuant to a guaranty and a security agreement in form and substance acceptable
to the Lender in its sole discretion.

       

      (b)           Directly
or indirectly, and will not permit any of its Subsidiaries to directly or
indirectly, create or otherwise cause or suffer to exist or become effective any
encumbrance or restriction on the ability of any such Subsidiary to (i) make
Distributions on its Capital Securities owned by the Borrower or any of its
Subsidiaries, or pay any Indebtedness owed to the Borrower or any of its
Subsidiaries, (ii) make loans or advances to the Borrower or any of its
Subsidiaries or (iii) transfer any of its properties or assets to the Borrower
or any of its Subsidiaries, except for such encumbrances or restrictions
existing under or by reason of (A) applicable law, (B) this Agreement and the
other Loan Documents, (C) customary provisions restricting subletting or
assignment of any lease governing any leasehold interest of the Borrower or any
of its Subsidiaries, (D) customary provisions restricting assignment of any
licensing agreement (in which the Borrower or any of its Subsidiaries is the
licensee) or other contract entered into by the Borrower or any of its
Subsidiaries in the ordinary course of business, and (E) restrictions on the
transfer of any asset pending the close of the sale of such
asset.


      
        
           


        

        
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      12.11      Transactions with Credit
Parties.  Not, and will not permit any of the Credit Parties
to, enter into any transaction or series of related transactions with any
Affiliate of any of the Credit Parties, other than in the ordinary course of
business and on terms and conditions substantially as favorable to the Credit
Party as would reasonably be obtained by the Credit Party at that time in a
comparable arm’s-length transaction with a Person other than an
Affiliate.

       

      ARTICLE
13 - FINANCIAL COVENANTS

       

      So long
as any Obligations shall be outstanding or this Agreement remains in effect,
unless the Lender otherwise consents in writing, the Borrower
shall:

       

      13.1        Debt to
EBITDARS.  Maintain at all times a Debt to EBITDARS Ratio, on a
consolidated basis, no greater than the following ratios for the following
periods, reported at the end of each Fiscal Quarter:

       

      
        
          
            
              
                	
                        Closing
      Date through and including 9/29/2010

                      	 	
                        <
      3.50 to 1.00

                      
	 
      	 	 
      
	
                        9/30/2010
      through and including 9/29/2011

                      	 	
                        <
      3.00 to 1.00

                      
	 
      	 	 
      
	
                        9/30/2011
      and thereafter

                      	 	
                        <2.50
      to 1.00

                      


              

            

          

        

      

       

      For
purposes of the Closing Date ratio, EBITDARS related to GTC shall be calculated
using year-to-date EBITDARS through October 31, 2009, annualized, but not to
exceed $3,480,000 (the pre-Closing Date pro forma estimated EBITDARS for GTC for
Fiscal Year 2009).

       

      13.2        Minimum Quarterly
EBITDARS.  Maintain at all times minimum EBITDARS for the
trailing three months, on a consolidated basis, equal to or greater than
$1,000,000, reported at each Fiscal Quarter end commencing with the Fiscal
Quarter ending March 31, 2010.

       

      13.3        Minimum Annual
EBITDARS.  Maintain minimum EBITDARS on a trailing
twelve-Fiscal Month basis, on a consolidated basis, equal to or greater than
$5,000,000, reported on at each Fiscal Year end commencing with the Fiscal year
ending December 31, 2010.

       

      13.4        Fixed Charge Coverage
Ratio.  Maintain at all times a Fixed Charge Coverage Ratio, on
a consolidated basis, equal to or greater than 1.25 to 1.00, reported at the
Closing Date and at each succeeding Fiscal Quarter end.

       

      13.5        Quarterly Covenant
Compliance Sheet.  Provide the Quarterly Covenant Compliance
Sheet to Lender within thirty (30) days after the close of each of its Fiscal
Quarters.

       

      ARTICLE
14 - ENVIRONMENTAL MATTERS; INDEMNIFICATION

       

      14.1        Environmental
Representations.  Borrower represents and warrants that, except
as disclosed in the Environmental Report delivered to Lender related to the
Mortgaged Property:

       

      (a)           Neither
the Improvements nor any property adjacent to the Improvements is being or has
been used for, and none of the Credit Parties are engaged in, the storage,
treatment, generation, transportation, processing, handling, production or
disposal of any Hazardous Substance or as a landfill or other waste disposal
site or for the storage of petroleum or petroleum based products except in
compliance with all Environmental Laws.


      
        
           


        

        
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      (b)           Underground
storage tanks are not and have not been located on the Improvements except in
compliance with all Environmental Laws

       

      (c)           The
soil, subsoil, bedrock, surface water and groundwater of the Improvements are
free of any Hazardous Substances, except as permitted by Environmental
Laws.

       

      (d)           There
has been no Release, nor is there the threat of a Release of any Hazardous
Substance on, at or from the Improvements or any property adjacent to or within
the immediate vicinity of the Improvements which through soil, subsoil, bedrock,
surface water or groundwater migration could come to be located on the
Improvements, and the Credit Parties have not received any form of notice or
inquiry from any federal, state or local governmental agency or authority, any
operator, tenant, subtenant, licensee or occupant of the Improvements or any
property adjacent to or within the immediate vicinity of the Improvements or any
other person with regard to a Release or the threat of a Release of any
Hazardous Substance on, at or from the Improvements or any property adjacent to
the Improvements.

       

      (e)           All
Environmental Permits relating to the Credit Parties and the Improvements have
been obtained and are in full force and effect.

       

      (f)           No
event has occurred with respect to the Improvements which, with the passage of
time or the giving of notice, or both, would constitute a violation of any
applicable Environmental Law or non-compliance with any Environmental
Permit.

       

      (g)           There
are no agreements, consent orders, decrees, judgments, license or permit
conditions or other orders or directives of any federal, state or local court,
governmental agency or authority relating to the past, present or future
ownership, use, operation, sale, transfer or conveyance of the Improvements
which require any change in the present condition of the Improvements or any
work, repairs, construction, containment, clean up, investigations, studies,
removal or other remedial action or capital expenditures with respect to the
Improvements.

       

      (h)           There
are no actions, suits, claims or proceedings, pending or threatened, which could
cause the incurrence of expenses or costs of any name or description or which
seek money damages, injunctive relief, remedial action or any other remedy that
arise out of, relate to or result from (i) a violation or alleged violation of
any applicable Environmental Law or noncompliance or alleged non-compliance with
any Environmental Permit, (ii) the presence of any Hazardous Substance or a
Release or the threat of a Release of any Hazardous Substance on, at or from the
Improvements or any property adjacent to or within the immediate vicinity of the
Improvements or (iii) human exposure to any Hazardous Substance, noises,
vibrations or nuisances of whatever kind to the extent the same arise from the
condition of the Improvements or the ownership, use, operation, sale, transfer
or conveyance thereof.

       

      14.2        Environmental
Covenants.  Borrower covenants and agrees with the Lender that,
until the Obligations have been fully satisfied and paid and the Commitment has
been terminated, the Borrower shall:

       

      (a)           Comply
with, and shall cause all operators, tenants, subtenants, licensees and
occupants of the Improvements to comply with all applicable Environmental Laws
and shall obtain and comply with, and shall cause all operators, tenants,
subtenants, licensees and occupants of the Improvements to obtain and comply
with, all Environmental Permits.


      
        
           


        

        
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      (b)           Not
cause or permit any change to be made in the present or intended use of the
Improvements which would (i) violate any applicable Environmental Law, (ii)
constitute non-compliance with any Environmental Permit or (iii) materially
increase the risk of a Release of any Hazardous Substance.

       

      (c)           Promptly
provide the Lender with a copy of all notifications which it gives or receives
with respect to any past or present Release or the threat of a Release of any
Hazardous Substance on, at or from the improvements or any property adjacent to
the Improvements.

       

      (d)           Undertake
and complete all investigations, studies, sampling and testing and all removal
and other remedial actions required by law to contain, remove and clean up all
Hazardous Substances that are determined to be present at the Improvements in
accordance with all applicable Environmental Laws and all Environmental
Permits.

       

      (e)           At
all times upon prior notice, allow the Lender and its officers, employees,
agents, representatives, contractors and subcontractors access to the
Improvements for the purposes of ascertaining site conditions, including, but
not limited to, subsurface conditions.

       

      (f)           Deliver
promptly to the Lender: (i) copies of any documents received from the United
States Environmental Protection Agency, or any state, county or municipal
environmental or health agency concerning a Credit Parties’ operations or the
Improvements; and (ii) copies of any documents submitted by any of the Credit
Parties to the United States Environmental Protection Agency or any state,
county or municipal environmental or health agency concerning its operations or
the Improvements.

       

      (g)           If
at any time the Lender obtains any reasonable evidence or information which
suggests that a material potential environmental problem may exist at the
improvements, the Lender may require that a kill or supplemental environmental
inspection and audit report with respect to the Improvements of a scope and
level of detail satisfactory to the Lender be prepared by an environmental
engineer or other qualified person acceptable to the Lender at the Borrower’s
expense.  Such audit may include a physical inspection of the
Improvements, a visual inspection of any property adjacent to or within the
immediate vicinity of the Improvements, personnel interviews and a review of all
Environmental Permits.  If the Lender requires, such inspection shall
also include a records search and/or subsurface testing for the presence of
Hazardous Substances in the soil, subsoil, bedrock, surface water and/or
groundwater.  If such audit report indicates the presence of any
Hazardous Substance or a Release or the threat of a Release of any Hazardous
Substance on, at or from the Improvements, the Credit Parties shall promptly
undertake and diligently pursue to completion all necessary, appropriate and
legally authorized investigative, containment, removal, clean up and other
remedial actions, using methods recommended by the engineer or other person who
prepared said audit report and acceptable to the appropriate federal, state and
local agencies or authorities.


      
        
           


        

        
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      14.3        Indemnity.  Borrower
agrees to indemnify, defend and hold harmless the Lender from and against any
and all liabilities, claims, damages, penalties, expenditures, losses or
charges, including, but not limited to, all costs of investigation, monitoring,
legal representation, remedial response, removal, restoration or permit
acquisition of any kind whatsoever, which may now or in the future be
undertaken, suffered, paid, awarded, assessed, or otherwise incurred by the
Lender (or any other Person affiliated with the Lender or representing or acting
for the Lender or at the Lender’s behest, or with a claim on the Lender or to
whom the Lender has liability or responsibility of any sort related to this
Section 14.3) relating to, resulting from or arising out of (a) the use of the
Improvements for the storage, treatment, generation, transportation, processing,
handling, production or disposal of any Hazardous Substance or as a landfill or
other waste disposal site, (b) the presence of any Hazardous Substance or a
Release or the threat of a Release of any Hazardous Substance on, at or from the
Improvements, (c) the failure to promptly undertake and diligently pursue to
completion all necessary, appropriate and legally authorized investigative,
containment, removal, clean up and other remedial actions with respect to a
Release or the threat of a Release of any Hazardous Substance on, at or from the
Improvements, (d) human exposure to any Hazardous Substance, noises, vibrations
or nuisances of whatever kind to the extent the same arise from the condition of
the Improvements or the ownership, use, operation, sale, transfer or conveyance
thereof, (e) a violation of any applicable Environmental Law, (f) non-compliance
with any Environmental Permit or (g) a material misrepresentation or inaccuracy
in any representation or warranty or a material breach of or failure to perform
any covenant made by Borrower in this Agreement.  Such costs or other
liabilities incurred by the Lender, or other Person described in this Section
14.3 shall be deemed to include, without limitation, any sums which the Lender
deems it necessary or desirable to expend to protect the Lender’s security
interests and liens.

       

      14.4        No
Limitation.  The liability of the Borrower under this Article
14 shall in no way be limited, abridged, impaired or otherwise affected by (a)
any amendment or modification of this Agreement or any other document relating
to the Obligations by or for the benefit of the Credit Parties or any subsequent
owner of the Improvements except for an amendment or modification which
expressly refers to this Article 14, (b) any extensions of time for payment or
performance required by this Agreement or any other document relating to the
Obligations, (c) the release of any of the Credit Parties or any other person
from the performance or observance of any of the agreements, covenants, terms or
conditions contained in this Agreement or any other document relating to the
Obligations by operation of law, or the Lender’s voluntary act or otherwise, (d)
the invalidity or unenforceability of any of the terms or provisions of this
Agreement or any other document relating to the Obligations, (e) any exculpatory
provision contained in this Agreement or any other document relating to the
Obligations limiting the Lender’s recourse, to property encumbered by any
mortgage or to any other security or limiting the Lender’s rights to a
deficiency judgment against the Borrower, (f) any applicable statute of
limitations, (g) any investigation or inquiry conducted by or on behalf of the
Lender or any information which the Lender may have or obtain with respect to
the environmental or ecological condition of the Improvements, (h) the sale,
assignment or foreclosure of any interest in collateral for the Obligations, (i)
the sale, transfer or conveyance of all or part of the Improvements, (j) the
dissolution and liquidation of Borrower, (k) the death or legal incapacity of
any individual, (l) the release or discharge, in whole or in part, of Borrower
in any bankruptcy, insolvency, reorganization, arrangement, readjustment,
composition, liquidation or similar proceeding, or (m) any other circumstances
which might otherwise constitute a legal or equitable release or discharge of
Borrower, in whole or in part.

       

      
        
          
          

        

        
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      14.5        Survival. Notwithstanding
anything to the contrary contained herein, the liability and obligations of the
Borrower under Section 14.3 shall survive the discharge, satisfaction or
assignment of this Agreement and the payment in full of all of the Obligations,
unless such liability and obligations are terminated with express reference to
this Section 14.5.

       

      14.6        Investigations. If
Borrower defaults on any of its Obligations pursuant to this Agreement or any
other Loan Document, the Lender or its designee shall have the right, upon
reasonable notice to the Borrower, to enter upon the Improvements and conduct
such tests, investigation and sampling, including, but not limited to,
installation of monitoring wells, as shall be reasonably necessary for the
Lender to determine whether any disposal of Hazardous Substances has occurred
on, at or near the Improvements.  The costs of all such tests,
investigations and samplings shall be considered as additional Debt secured by
all collateral for the Obligations and shall become immediately due and payable
without notice and with interest thereon at the highest rate then borne by any
of the Obligations.

       

      14.7        No Warranty Regarding
Information. Borrower agrees that the Lender shall not be liable in
any way for the completeness or accuracy of any Environmental Report or the
information contained therein.  The Borrower further agrees that the
Lender has no duty to warn any of the Credit Parties or any other Person about
any actual or potential environmental contamination or other problem that may
have become apparent or will become apparent to the Lender.

       

      ARTICLE
15 - DEFAULTS

       

      15.1        Defaults. The
following events (hereinafter called “Events of Default”) shall
constitute defaults under this Agreement:

       

      (a)        
 Nonpayment.  Failure
of Borrower to make any payment of any type under the terms of this Agreement,
any of the Notes, or of any of the Loan Documents, within ten (10) days after
the same becomes due and payable, except that there shall be no ten (10) day
grace period for the Borrower’s obligation to reduce the principal balance of
the Revolving Credit Facility if the outstanding principal balance of the
Revolving Credit Facility exceeds the Revolving Credit Commitment or the
Borrowing Base under Sections 2.1 and 2.2 of this Agreement.

       

      (b)         
Performance.  Failure
of any of the Credit Parties to observe or perform, as applicable,

       

      (i)           any
of the financial covenants in Article 13 of this Agreement,

       

      (ii)          Sections
11.1(a), 11.1(b), 11.1(c), 11.1(d), 11.4, and 11.14,

       

      (iii)         Sections
11.1(f), 11.1(j), 11.6, and 11.12 within ten days after the date on which
performance was required, or

       

      
        
          
          

        

        
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      (iv)         any
condition, covenant or term of this Agreement or any Loan Document not covered
by Section 15.1(a), Section 15.1(b)(i), Section 15.1(b)(ii), or Section
15.1(b)(iii) which is not cured within thirty (30) days after notice of such
failure is sent by the Lender, and provided that during such thirty (30) day
period the Credit Parties are diligently and in good faith curing such
failure.

       

      (c)          Other Obligations to
Lender.  Failure of any Credit Party to observe or perform any
condition or covenant of any other agreement or instrument with the Lender, or
any of its affiliates not covered by Section 15.1(a) or Section 15.1(b) after
any applicable cure or grace period related thereto.

       

      (d)          Obligations to Third
Parties.  Default by any Credit Party under:

       

      (i)           any
agreement or instrument involving Debt in excess of $100,000 (except as covered
by Section 15.1(a), Section 15.1(b), or Section 15.1(c)) unless and so long as
such default is being contested reasonably diligently and in good faith and no
judgment has been taken against the respective Credit Party or restraint, levy,
or similar action with respect to any assets of the Credit Party has occurred,
or

       

      (ii)          any
other agreement with any third Person, which is not terminable on thirty (30)
days or less notice, or provides for payment of consideration of more than
$100,000 by any party thereafter unless and so long as such default is being
contested reasonably diligently and in good faith.

       

      (e)          Representations.  Failure
of any representation or warranty made by any Credit Party in connection with
the execution and performance of any Loan Document or any certificate of
officers pursuant thereto, to be truthful, accurate or correct in all material
respects; provided such failure in the case of representations and warranties
specific as to a date certain must be as of such date certain.

       

      (f)          Financial
Difficulties.  Financial difficulties of any Credit Party as
evidenced by:

       

      (i)          any
admission in writing of inability to pay debts as they become due;
or

       

      (ii)          immediately
upon the filing of a voluntary, or sixty (60) days after a filing of an
involuntary, petition in bankruptcy, or under any chapters of the Bankruptcy
Code, or under any federal or state statute providing for the relief of debtors
unless, in the case of the filing of an involuntary petition, it is dismissed
within such sixty (60) day period; or

       

      (iii)         making
an assignment for the benefit of creditors; or

       

      (iv)   
     consenting to the appointment of a trustee or
receiver for all or a major part of any of its property; or

       

      (v)          the
entry of a court order appointing a receiver or a trustee for all or a major
part of its property which is not bonded, discharged or stayed within sixty (60)
days;

       

      
        
          
          

        

        
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      (vi)         the
occurrence of any event, action, or transaction that could give rise to a lien
or encumbrance on the assets of any Credit Party as a result of application of
relevant provisions of ERISA; or

       

      (vii)        the
occurrence of any Forfeiture Action.

       

      (g)          Change in
Control.  The occurrence of a Change in Control.

       

      (h)          Security
Documents.  Any Credit Party, as signatory under any of the
Security Documents, shall cause at any time or if for any reason the Security
Documents to: (i) cease to create a valid and perfected Lien in and to the
property purported to be subject to the same for any reason other than the
failure of the secured parties thereunder to continue any UCC financing
statement, or (ii) cease to be in full force and effect or shall be declared
null and void, or (iii) the validity or enforceability of any Security Document
shall be contested by any party thereto or any party thereto shall deny it has
any further liability or obligations to the secured parties
thereunder.

       

      (i)           ERISA.  Any
event occurs or condition exists which, with notice or lapse of time or both,
would make any Plan of any Credit Party subject to termination under subsections
(1), (2) and (3) of Section 4042(a) of ERISA, or any Credit Party or any of
their respective plan administrators shall have received notice from the PBGC
indicating that it has made a determination that any Plan of any Credit Party is
subject to termination under Section 4042(a)(4) of ERISA, or any Credit Party is
subject to employer’s liability under Section 4062, 4063, or 4064 of ERISA, in
each case under ERISA as now or hereafter amended.

       

      (j)           Government
Contracts.  Any notice of debarment, notice of suspension or
termination for default shall have been issued under any government contract, or
(ii) any of the Credit Parties is debarred or suspended from contracting with
any part of the United States Government or any state, local or foreign
government, or (iii) a United States Government or any state, local or foreign
government investigation shall have resulted in criminal or civil liability,
suspension, debarment or any other adverse administrative action arising by
reason of alleged fraud, willful misconduct, neglect, default or other
wrongdoing, or (iv) the actual termination of any government contract due to
alleged fraud, willful misconduct, neglect, default or any other wrongdoing and
the effect of any of the foregoing events, either individually or in the
aggregate, has had, or could reasonably be expected to have, a Material Adverse
Effect.

       

      15.2        Remedies.

       

      (a)           If
any one or more Events of Default listed in Section 15.1(d)(i)-(vi) occur, (a)
the Commitment and any further commitments or obligations of the Lender shall be
deemed to be automatically and without need for further action terminated, and
(b) all Obligations of the Borrower to the Lender, automatically and without
need for further action, shall become forthwith due and payable without
presentment, demand, protest, or other notice of any kind, all of which are
hereby expressly waived.  If any one or more Events of Default other
than those listed in Section 15.1(f)(i)-(vi) occur, the Lender may, at its
option, take either or both of the following actions at the same or different
times: (i) terminate the Commitment and any further commitments or obligations
of the Lender, and (ii) declare all Obligations of the Borrower to the Lender,
automatically and without need for further action, to be forthwith due and
payable without presentment, demand, protest, or other notice of any kind, all
of which are hereby expressly waived.

       

      
        
          
          

        

        
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      (b)           In
case any such Events of Default shall occur, the Lender shall be entitled to
recover judgment against the Borrower for all Obligations of the Borrower to the
Lender either before, or after, or during the pendency of any proceedings for
the enforcement, of any Security Document and, in the event of realization of
any funds from any security or guarantee and application thereof to the payment
of the Obligations due, the Lender shall be entitled to enforce payment of and
recover judgment for all amounts remaining due and unpaid on such
Obligations.

       

      (c)           The
Lender shall be entitled to exercise any other legal or equitable right which it
may have, and may proceed to protect and enforce its rights by any other
appropriate proceedings, including action for the specific performance of any
covenant or agreement contained in this Agreement and the Loan
Documents.

       

      (d)           In
the case of an Event of Default caused by a failure of compliance with Section
11.14, without limitation of any other right and remedy of the Lender, the
Borrower shall deliver to Lender a mortgage in form satisfactory to Lender
covering the premises located at 105 Norton Street, Newark, Wayne County, New
York, together with a mortgagee title insurance policy in form satisfactory to
the Lender insuring the same and a survey, environmental report, and appraisal
covering such property, all in form satisfactory to the Lender.

       

      ARTICLE
16 - MISCELLANEOUS

       

      16.1        Waiver. No delay
or failure of the Lender to exercise any right, remedy, power or privilege
hereunder shall impair the same or be construed to be a waiver of the same or of
any Event of Default or an acquiescence therein.  No single or partial
exercise of any right, remedy, power or privilege shall preclude other or
further exercise thereof by the Lender.  All rights, remedies, powers,
and privileges herein conferred upon the Lender shall be deemed cumulative and
not exclusive of any others available.

       

      16.2        Survival of
Representations. All representations and warranties contained herein
shall survive the execution and delivery of this Agreement and the execution and
delivery of other agreements hereunder.

       

      16.3        Additional Security;
Setoff. The Lender shall have a security interest in and right of
setoff with respect to all deposits or other sums credited by or due from the
Lender to Borrower and a security interest in all securities or other property
of Borrower in any of the Lender’s possession for safekeeping or
otherwise.  The Lender’s security interest shall secure payment of the
Obligations.  In the event of any Event of Default under this
Agreement, regardless of the adequacy of collateral, without any demand or
notice, except as required by applicable law, any Lender may apply or setoff
such deposits or other sums and may sell or dispose of any or all of such
securities or other property and may exercise any and all rights it may have
under the New York Uniform Commercial Code, as in effect from time to
time.  The rights of the Lender under this Agreement are in addition
to, and not exclusive of, any other rights it may have with respect to such
deposits, sums, securities, or other property under other agreements or
applicable principles of law.  The Lender shall have no duty to take
steps to preserve rights against prior parties as to such securities or other
property.

       

      
        
          
          

        

        
          57

          
            

          

        

        
          
          

        

      

       

      16.4        Notices. Any
notice or demand upon any party hereto shall be deemed to have been sufficiently
given or served for all purposes hereof when delivered in person, the Business
Day after delivery to a nationally recognized overnight courier marked for next
Business Day delivery, or three (3) Business Days after it is mailed certified
mail postage prepaid, return receipt requested, addressed as
follows:

       

      If to
Lender:

       

      Manufacturers
and Traders Trust Company

      East
Avenue

      Rochester,
New York 14604

      Attention:  J.
Theodore Smith/Brett Rawlings

      Facsimile:  (585)
325-5105

       

      with a
copy to:

       

      Harris
Beach PLLC

      Garnsey
Road

      Pittsford,
New York 14534

      Attention:  Beth
Ela Wilkens, Esq.

      Facsimile:  (585)
419-8818

       

      If to
Borrower:

       

      IEC
Electronics Corp.

      Norton
Street

      Newark,
New York 14513

      Attention:        
W. Barry Gilbert, CEO and

      Michael
Schlehr, CFO

       

      with a
copy to:

       

      Boylan
Brown Code Vigdor & Wilson

      Chase
Square

      Rochester,
New York 14604

      Attention:  Robert
F. Mechur, Esq.

      Facsimile:  (585)
232-3528

       

      Any party
may change, by notice in writing to the other parties, the address to which
notices to it shall be sent.

       

      16.5        Entire
Agreement. This Agreement and the Loan Documents embody the entire
agreement and understanding among the parties and supersede all prior agreements
and understandings relating to the subject mailer hereof.  This
Agreement shall not be changed or amended without the written agreement of all
parties hereto.  This Agreement embodies all commitments to lend
between the Lender and the Borrower and supersedes any prior
commitments.

       

      
        
          
          

        

        
          58

          
            

          

        

        
          
          

        

      

       

      16.6        Parties in
Interest.

       

      (a)           All
the terms and provisions of this Agreement shall inure to the benefit of and be
binding upon and be enforceable by the parties and their respective successors
and assigns and shall inure to the benefit of and be enforceable by any holder
of any of the Notes.  Upon any transfer of any Obligation or any
interest therein any Lender may deliver or otherwise transfer or assign to the
holder any collateral or guarantees for the Obligation, which holder shall
thereupon have all the rights of the Lender.

       

      (b)           The
rights, remedies, and benefits of and in favor of the Lender under this
Agreement shall inure to the benefit of, and be enforceable by, any or all of
the Lender and each of its affiliates.

       

      16.7        Indemnity.

       

      (a)           Nothing
in this Section 16.7 shall be deemed or shall be construed to relieve or release
the Lender from any liability for breach of contract arising from any failure by
the Lender to perform its contractual obligations hereunder.  The
Borrower shall indemnify and hold harmless the Lender and its affiliates,
directors, officers, employees, agents, and representatives from and against any
and all claims, damages, liabilities, and expenses that may be incurred by or
asserted against such indemnified party in connection with the Loan Documents
and the transactions contemplated thereby including in connection with the
investigation of, preparation for, or defense of any pending or threatened
claim, action, or proceeding; provided, however, that the Borrower shall not be
liable to any indemnified party for such claims, damages, liabilities, and
expenses resulting from such indemnified party’s own gross negligence or willful
misconduct.

       

      (b)           To
the extent, if at all, New Mexico NMSA 1978, Section 56-7-1, as amended, is
applicable to any Loan Document, any agreement to indemnify, hold harmless,
insure or defend another party contained therein shall not extend to liability,
claims, damages, losses or expenses, including attorneys’ fees, arising out of
bodily injury to persons or damage to property caused by or resulting from, in
whole or in part, the negligent act or omission of the indemnitee, its officers,
employees or agents.

       

      16.8        Usury. The Loan
Documents are hereby expressly limited so that in no contingency or event
whatsoever, whether by reason of acceleration or maturity of the indebtedness
evidenced hereby or otherwise, shall the amount paid or agreed to be paid to
Lender for the use or the forbearance of the indebtedness evidenced hereby
exceed the maximum permissible under applicable law.  As used in this
Section 16.8, the term “applicable law” shall mean
the law in effect as of the date hereof, provided, however that in the event
there is a change in the law which results in a higher permissible rate of
interest, then the Loan Documents shall be governed by such new law as of its
effective date.  If, under or from any circumstances whatsoever,
fulfillment of any provision hereof or of any of the Loan Documents at the time
performance of such provision shall be due, shall involve transcending the limit
of such validity prescribed by applicable law, then the obligation to be
fulfilled shall automatically be reduced to the limits of such validity, and if
under or from any circumstances whatsoever the Lender should ever receive as
interest an amount which would exceed the highest lawful rate, such amount which
would be excessive interest shall be applied to the reduction of the principal
balance evidenced hereby and not to the payment of interest.  This
provision shall control every other provision of all Loan
Documents.

       

      
        
          
          

        

        
          59

          
            

          

        

        
          
          

        

      

       

      16.9         Severability. In
the event that anyone or more of the provisions contained in this Agreement or
any other Loan Document shall, for any reason, be held invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision of this Agreement or such other Loan
Document.

       

      16.10       Governing
Law. This Agreement and the Loan Documents (except as otherwise
expressly provided therein), together with all of the rights and obligations of
the parties hereto, shall be construed, governed and enforced in accordance with
the laws of the State of New York, without giving effect to the principles of
conflict of laws thereof.

       

      16.11       Electronic
Communications. Borrowing base and compliance certificates submitted
to the Lender electronically by a representative of the Borrower shall be deemed
to have been submitted and signed by the representative sending the electronic
communication.

       

      16.12       Patriot Act. The
Lender hereby notifies the Credit Parties that pursuant to the requirements of
the USA Patriot Act (Title III of Pub. L. 107-56 signed into law October 26,
2001 and for purposes of this Section 16.12 called the “Act”), it is required to
obtain, verify, and record information that identifies the Credit Parties, which
information includes the name and address of the Credit Parties and other
information that will allow the Lender to identify the Credit Parties in
accordance with the Act.

       

      16.13       Counterparts. This
Agreement may be executed in any number of counterparts, all of which taken
together shall constitute one and the same agreement, and any party hereto may
execute this Agreement by signing any such counterpart.

       

      16.14       Survival. All
indemnities set forth herein shall survive the execution, delivery, and
termination of this Agreement and the Loan Documents and the making and
repayment of the Obligations.

       

      16.15       Jurisdiction. Borrower
hereby irrevocably and unconditionally consents to jurisdiction and service of
process, which may be effected by certified mail in accordance with the
certified mail provisions contained in Section 16.4, in the Supreme Court of the
State of New York sifting in Monroe County, or of the United States District
Court for the Western District of New York.  Borrower hereby
irrevocably and unconditionally waives any objection it may have to the laying
of venue of any such action, suit or proceeding in any such court referred to in
this Section 16.15.  Borrower hereby irrevocably waives the defense of
an inconvenient forum to the maintenance of any such action, suit or proceeding
in any such court.

       

      16.16       Waiver of Trial by
Jury. BORROWER WAIVES TRIAL BY JURY OF ANY CLAIMS OR PROCEEDINGS
WITH RESPECT TO THIS AGREEMENT, THE LOAN DOCUMENTS, THE OBLIGATIONS AND ALL
MATTERS RELATED HERETO TO THE FULLEST EXTENT ALLOWED BY LAW.

       

      
        
          
          

        

        
          60

          
            

          

        

        
          
          

        

      

       

      IN
WITNESS WHEREOF, the parties have caused this Agreement to be executed by their
duly authorized representatives by their signatures below.

       

      [Signature
Pages Follow]

       

      
        
          
          

        

        
          61

          
            

          

        

        
          
          

        

      

      
         

        MANUFACTURERS
AND TRADERS TRUST COMPANY,

         

        
          
            
              
                	
                        By:

                      	 
      	
                         

                      
	 
      	 
      	
                        Brett
      W. Rawlings

                      
	 
      	 
      	
                        Assistant
      Vice President

                      


              

            

          

        

         

        IEC
ELECTRONICS CORP.


         

        
          
            
              	
                      By:

                    	 
      	 
      
	 
      	 
      	
                      Barry Gilbert

                    
	 
      	 
      	
                      Chief
      Executive Officer

                    


            

          

        

      

       

      
        
          
          

        

        
          62

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
A

      FORM OF MONTHLY COVENANT
COMPLIANCE CERTIFICATE

       

      IEC
ELECTRONICS CORP.

      FINANCIAL
COVENANT CALCULATION

       

      As of
______________:

       

      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        	
                                                Credit

                                                Agreement

                                                Section

                                              	 	
                                                Covenant

                                              	 	
                                                Requirement

                                              	 	
                                                Calculation as of

                                                Above Date

                                              	 	
                                                Compliance

                                                (Yes/No)

                                              
	 	 	 	 	 	 	 	 	 
	
                                                Section
      13.1

                                              	 	
                                                Debt
      to EBITDARS

                                              	 	 
      	 	
                                                ____
      to 1.0

                                              	 	 
      
	 	 	 	 	 	 	 	 	 
	
                                                Section
      13.2

                                              	 	
                                                Minimum
      Quarterly EBITDARS

                                              	 	
                                                At
      least $1,000,000

                                              	 	
                                                $___________

                                              	 	 
      
	 	 	 	 	 	 	 	 	 
	
                                                Section
      13.3

                                              	 	
                                                Minimum
      Annual EBITDARS

                                              	 	
                                                At
      least $5,000,000

                                              	 	 
      	 	 
      
	 	 	 	 	 	 	 	 	 
	
                                                Section
      13.4

                                              	 	
                                                Fixed
      Charge Coverage Ratio

                                              	 	
                                                At
      least 1.25:1.00

                                              	 	
                                                ___
      to 1.0

                                              	 	 
      


                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

      


      The Debt
to EBITDARS Ratio is _____:1.00.  Based upon such ratio, the
Applicable Margin and Applicable Unused Fee will be set at Level
___.

       

      Definitions
used in this Certificate have the meanings given to them in the Credit Facility
Agreement dated December 16, 2009, if and as amended (the “Credit
Agreement”).

       

      I hereby
certify that (i) the above calculations are correct and accurately reflect the
consolidated financial condition of the Borrower as of the date shown above, and
(ii) No Default or Event of Default has occurred under the Credit
Agreement.

       

       

      
        

      

      As Chief
Financial Officer

      of IEC
ELECTRONICS CORP.

       

      
        
          
          

        

        
          63

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
B

      FORM OF REVOLVING CREDIT
NOTE

       

      AMENDED
AND RESTATED REVOLVING CREDIT NOTE

       

      
        	
                $15,000,000

              	
                December
      16, 2009

              


      

       

      IEC
ELECTRONICS CORP. (“Borrower”), a corporation
organized under the laws of Delaware, for value received, hereby promises to pay
to the order of MANUFACTURERS AND TRADERS TRUST COMPANY (“Lender”) the principal sum of
Fifteen Million Dollars ($15,000,000) or, if less, the amount of the Revolving
Credit Loans loaned by the Lender to Borrower pursuant to the Agreement referred
to below, in lawful money of the United States of America and in immediately
available funds on the date(s) and in the manner provided in said Agreement and
with a final payment on the Revolving Credit Termination
Date.  Borrower also promises to pay interest on the unpaid principal
balance hereof, for the period such balance is outstanding, in like money, at
the rates of interest as provided in the Agreement described below, on the
date(s) and in the manner provided in said Agreement.

       

      The date
and amount of each Revolving Credit Loan made by the Lender to the Borrower
under the Agreement referred to below, maturity date and each payment of
principal thereof, shall be recorded by the Lender on its books.  The
Lender’s records shall be presumed to be accurate absent manifest
error.

       

      This is
the Revolving Credit Note referred to in that certain Amended and Restated
Credit Facility Agreement (as amended, supplemented, or restated from time to
time, the “Agreement”)
dated as of December 16, 2009, made among Borrower and Lender, and evidences the
Revolving Credit Loans made thereunder.  All capitalized terms not
defined herein shall have the meanings given to them in the
Agreement.

       

      Borrower
waives presentment, notice of dishonor, protest and any other notice or
formality with respect to this Revolving Credit Note.

       

      This
Revolving Credit Note shall be governed by the laws of the State of New
York.

       

      This
Revolving Credit Note evidences in part the obligations evidenced by, and
amends, restates, and replaces in its entirety the Revolving Credit Note made by
the Borrower in favor of the Lender dated May 30, 2008.

       

      
        
          
            
              
                
                  
                    
                      	 
      	
                              IEC
      ELECTRONICS CORP.

                            
	 
      	 
      	 
      
	 
      	
                              By:

                            	
                               
      

                            
	 	 	 
	 
      	
                              Title:

                            	
                                
      

                            


                    

                  

                

              

            

          

        

      

       

      
        
          
          

        

        
          64

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
C

      FORM OF 2008 TERM LOAN
NOTE

       

      AMENDED
AND RESTATED 2008 TERM LOAN NOTE

       

      
        	
                Original
      Principal Amount  - $1,700,000

                Principal
      Amount As of Date of this Note - $718,322

              	
                December
      16, 2009

              


      

       

      IEC
ELECTRONICS CORP. (“Borrower”), a corporation
organized under the laws of Delaware, for value received, hereby promises to pay
to the order of MANUFACTURERS AND TRADERS TRUST COMPANY (“Lender”) the principal sum of
Six Hundred Eighty-Nine Thousand Nine Hundred Eighty-Eight Dollars ($689,988),
in lawful money of the United States of America and in immediately available
funds in consecutive installments of principal on the first day of each month in
the amount of $28,334 each.  The entire unpaid principal amount of
this Amended and Restated 2008 Term Loan Note (“2008 Term Loan Note”) shall
be due and payable on the 2008 Term Loan Maturity Date.  Borrower also
promises to pay interest on the unpaid principal balance hereof, for the period
such balance is outstanding, in like money, at the rates of interest as provided
in the Agreement described below, on the date(s) and in the manner provided in
said Agreement.

       

      This is
the 2008 Term Loan Note referred to in that certain Amended and Restated Credit
Facility Agreement (as amended, supplemented, and restated from time to time,
the “Agreement”) dated
as of December 16, 2009, made among Borrower and Lender, and evidences the 2008
Term Loan described therein.  All capitalized terms not defined herein
shall have the meanings given to them in the Agreement.

       

      Borrower
waives presentment, notice of dishonor, protest and any other notice or
formality with respect to this 2008 Term Loan Note.

       

      This 2008
Term Loan Note shall be governed by the laws of the State of New
York.

       

      This 2008
Term Loan Note evidences in part the obligations evidenced by, and amends,
restates, and replaces in its entirety the Term Loan Note made by the Borrower
in favor of the Lender dated May 30, 2008.

      
         

        
          
            
              
                
                  
                    
                      
                        	 
      	
                                IEC
      ELECTRONICS CORP.

                              
	 
      	 
      	 
      
	 
      	
                                By:

                              	
                                  
      

                              
	 	 	 
	 
      	
                                Title:

                              	
                                  
      

                              


                      

                    

                  

                

              

            

          

        

      

       

      
        
          
          

        

        
          65

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
D

      FORM OF ENERGY LOAN NOTE
WITH RIDER

       

      See
attached

       

      
        
          
          

        

        
          66

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
E

      FORM OF EQUIPMENT LINE
NOTE

       

      EQUIPMENT
LINE NOTE

       

      
        	
                $________________

              	
                _________________,
      20__

              


      

       

      IEC
ELECTRONICS CORP. (“Borrower”), a corporation
organized under the laws of Delaware, for value received, hereby promises to pay
to the order of MANUFACTURERS AND TRADERS TRUST COMPANY (“Lender”) the principal sum of
__________________ Dollars ($_____________), in lawful money of the United
States of America and in immediately available funds in consecutive installments
of principal on the first day of each month in the amount of $__________
each.  The entire unpaid principal amount of the Equipment Line Loan
evidenced hereby shall be due and payable on the Revolving Credit Line
Termination Date.  Borrower also promises to pay interest on the
unpaid principal balance hereof, for the period such balance is outstanding, in
like money, at the rates of interest as provided in the Agreement described
below, on the date(s) and in the manner provided in said
Agreement.  The initial interest rate hereunder shall be [the LIBOR
Rate for a LIBOR Interest Period of _______ months/the Fixed Rate of ________%
per annum.

       

      This is
an Equipment Line Note referred to in that certain Amended and Restated Credit
Facility Agreement (as amended from time to time, the “Agreement”) dated as of
December 16, 2009, made among Borrower and Lender, and evidences an Equipment
Line Loan made thereunder.  All capitalized terms not defined herein
shall have the meanings given to them in the Agreement.

       

      Borrower
waives presentment, notice of dishonor, protest and any other notice or
formality with respect to this Equipment Line Note.

       

      This
Equipment Line Note shall be governed by the laws of the State of New
York.

       

      [The
Linked Deposit Program Rider attached to this Equipment Line Note is
incorporated herein by reference.]

       

      
        
          
            	 
      	
                    IEC
      ELECTRONICS CORP.

                  
	 
      	 
      	 
      
	 
      	
                    By:

                  	
                      
      

                  
	 	 	 
	 
      	
                    Title:

                  	
                      
      

                  


          

        

      

       

      
        
          
          

        

        
          67

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
F

      FORM OF LINKED DEPOSIT
PROGRAM RIDER

       

      LINKED
DEPOSIT PROGRAM RIDER

       

      THIS
RIDER is made as _______________, 20___ by IEC ELECTRONICS CORP. (“Borrower”) in favor of
Manufacturers and Traders Trust Company (“Lender”) in connection with
and as an addendum to the Equipment Line Note dated on even date herewith in the
original principal amount of $_____________ (‘Note”).  Unless
otherwise defined herein, all capitalized terms used herein shall have the
meanings as set forth in the Note and the Agreement referenced
therein.  To the extent that the terms of this Rider are inconsistent
with other terms in the Note, the terms of this Rider shall
control.

       

      1.           Definitions.

       

      “Adjusted Rate” shall mean on
any given day the rate selected by the Borrower pursuant to Section 5.1 of the
Agreement as in effect on the Closing Date, or any successor section
thereto.

       

      “Program Rate” shall mean the
rate equal to _____ percentage points below the initial Fixed Rate applicable to
the Note.

       

      “Reset Date” shall
mean:

       

      
        	
              	
                o 

              	
                Not
      Applicable (the Note is to mature without a Reset
  Date.)

              


      

       

      
        	
                 
      

              	
                o

              	
                the
      date _____ months from the date of the Note (which under no circumstances
      shall be more than forty-eight (48) months from the date of this
      Note).

              


      

       

      2.           Interest.  The
unpaid principal of this Note shall earn interest from and including the date
the proceeds of this Note are disbursed, to, but not including, the earlier of
the Reset Date (if applicable) or the final maturity date of the Note, at a rate
per year (“Interest
Rate”) which shall on each day be the Program Rate; provided, however,
the applicable Interest Rate prior to the earlier of the Reset Date (if
applicable) or the final maturity date of the Note shall automatically and
immediately (without further notice to Borrower) be adjusted to the Adjusted
Rate if (i) the Lender terminates its participation in the Linked Deposit
Program, (ii) the Linked Deposit Program is canceled or otherwise terminated,
(iii) Borrower’s right to participate in the Linked Deposit Program is canceled,
revoked or is otherwise not authorized, or (iv) all requirements of the Linked
Deposit Program have not been satisfied (as determined by the Lender in its
discretion) with respect to the Loan evidenced by the Note.  Under any
of the above scenarios, the Lender reserves the right to charge Borrower for the
amount of any interest that would have accrued, or other amounts that would
otherwise have been due to the Lender, if the Adjusted Rate had been in effect
from the date the proceeds of the Note were disbursed, and the Lender will waive
any applicable Prepayment Premium.

       

      [From and
including the Reset Date (if applicable), to, but not including the date all
amounts hereunder are paid in full, the applicable Interest Rate shall be the
Adjusted Rate.]

       

      
        
          
          

        

        
          68

          
            

          

        

        
          
          

        

      

       

      3.           Recalculation of Principal
and Interest Installments.  To the extent (if at all) that the
Note contemplates repayment by Borrower in consecutive level installments of
principal and interest over the term of the Note until the Maturity Date, the
amount of each installment of principal and interest due and payable under the
Note may be adjusted by the Lender at any time to account for any change in the
applicable Interest Rate as described herein.  Absent manifest error,
the Lender’s calculation of the adjustment and determination of the ongoing
installment amounts shall be conclusive of the amounts due and payable by
Borrower.  Any such adjustment may affect the amount of the final
installment of principal due at the final maturity date of the
Note.

      
         

        
          
            
              	 
      	
                      IEC
      ELECTRONICS CORP.

                    
	 
      	 
      	 
      
	 
      	
                      By:

                    	
                        
      

                    
	 	 	 
	 
      	
                      Title:

                    	
                        
      

                    


            

          

        

         

        
          
            
            

          

          
            69

            
              

            

          

          
            
            

          

        

         

      

      EXHIBIT
G

      FORM OF GTC TERM LOAN
NOTE

       

      GTC TERM
LOAN NOTE

       

      
        	
                $5,000,000

              	
                December
      16, 2009

              


      

       

      IEC
ELECTRONICS CORP. (“Borrower”), a corporation
organized under the laws of Delaware, for value received, hereby promises to pay
to the order of MANUFACTURERS AND TRADERS TRUST COMPANY (“Lender”) the principal sum of
Five Million Dollars ($5,000,000), in lawful money of the United States of
America and in immediately available funds in consecutive installments of
principal on the first day of each month in the amount of $83,333
each.  The entire unpaid principal amount of this GTC Term Loan Note
(“GTC Term Loan Note”)
shall be due and payable on the GTC Term Loan Maturity Date.  Borrower
also promises to pay interest on the unpaid principal balance hereof, for the
period such balance is outstanding, in like money, at the rates of interest as
provided in the Agreement described below, on the date(s) and in the manner
provided in said Agreement.

       

      This is
the GTC Term Loan Note referred to in that certain Amended and Restated Credit
Facility Agreement (as amended, supplemented, and restated from time to time,
the “Agreement”) dated
as of December 16, 2009, made among Borrower and Lender, and evidences the GTC
Term Loan described therein.  All capitalized terms not defined herein
shall have the meanings given to them in the Agreement.

       

      Borrower
waives presentment, notice of dishonor, protest and any other notice or
formality with respect to this GTC Term Loan Note.

       

      This GTC
Term Loan Note shall be governed by the laws of the State of New
York.

      
         

        
          
            
              	 
      	
                      IEC
      ELECTRONICS CORP.

                    
	 
      	 
      	 
      
	 
      	
                      By:

                    	
                        
      

                    
	 	 	 
	 
      	
                      Title:

                    	
                        
      

                    


            

          

        

         

        
          
            
            

          

          
            70

            
              

            

          

          
            
            

          

        

         

      

      EXHIBIT
H

      FORM OF MORTGAGE SECURED
TERM LOAN NOTE

       

      MORTGAGE
SECURED TERM LOAN NOTE

       

      
        	
                $4,000,000

              	
                December
      16, 2009

              


      

       

      IEC
ELECTRONICS CORP. (“Borrower”), a corporation
organized under the laws of Delaware, for value received, hereby promises to pay
to the order of MANUFACTURERS AND TRADERS TRUST COMPANY (“Lender”) the principal sum of
Four Million Dollars ($4,000,000), in lawful money of the United States of
America and in immediately available funds in consecutive installments of
principal on the first day of each month in the amount of $22,222
each.  The entire unpaid principal amount of this Mortgage Secured
Term Loan Note (“Mortgage
Secured Term Loan Note”) shall be due and payable on the Mortgage Secured
Term Loan Maturity Date.  Borrower also promises to pay interest on
the unpaid principal balance hereof, for the period such balance is outstanding,
in like money, at the rates of interest as provided in the Agreement described
below, on the date(s) and in the manner provided in said Agreement.

       

      This is
the Mortgage Secured Term Loan Note referred to in that certain Amended and
Restated Credit Facility Agreement (as amended, supplemented, and restated from
time to time, the “Agreement”) dated as of
December 16, 2009, made among Borrower and Lender, and evidences the Mortgage
Secured Term Loan described therein.  All capitalized terms not
defined herein shall have the meanings given to them in the
Agreement.

       

      Borrower
waives presentment, notice of dishonor, protest and any other notice or
formality with respect to this Mortgage Secured Term Loan Note.

       

      This
Mortgage Secured Term Loan Note shall be governed by the laws of the State of
New York.

      
         

        
          
            
              	 
      	
                      IEC
      ELECTRONICS CORP.

                    
	 
      	 
      	 
      
	 
      	
                      By:

                    	
                        
      

                    
	 	 	 
	 
      	
                      Title:

                    	
                        
      

                    


            

          

        

         

        
          
            
            

          

          
            71

            
              

            

          

          
            
            

          

        

      

       

      EXHIBIT
G

      FORM OF BORROWING BASE
REPORT

       

      See
attached

       

      
        
          
          

        

        
          72

          
            

          

        

        
          
          

        

      

       

      SCHEDULE 1.1(A)

      SECURITY
DOCUMENTS

       

      Amended
and Restated General Security Agreement

       

      Negative
Pledge Agreement

       

      Amended
and Restated Pledge Agreement

       

      Trademark
Security Agreement

       

      Copyright
Security Agreement

       

      Mortgage

       

      Assignment
of Leases and Rents

       

      Environmental
Compliance and Indemnification Agreement

       

      
        
          
          

        

        
          73

          
            

          

        

        
          
          

        

      

       

      SCHEDULE 9.1

      CREDIT PARTIES;
JURISDICTIONS

       

      
        
          
            
              
                
                  
                    
                      	
                              Credit Party Name

                            	 	
                              Jurisdiction of Formation

                            	 	
                              Jurisdictions of
    Qualification

                            
	 	 	 	 	 
	
                              IEC
      Electronics Corp.

                            	 	
                              Delaware

                            	 	
                              New
      York

                            
	 	 	 	 	 
	
                              IEC
      Electronics Wire and Cable, Inc.

                            	 	
                              New
      York

                            	 	
                              None

                            
	 	 	 	 	 
	
                              General
      Technology Corporation

                            	 	
                              New
      Mexico

                            	 	
                              California

                            


                    

                  

                

              

            

          

        

      

      


      
        
          
          

        

        
          74

          
            

          

        

        
          
          

        

      

       

      SCHEDULE 9.5

      LITIGATION

       

      None

       

      
        
          
          

        

        
          75

          
            

          

        

        
          
          

        

      

       

      SCHEDULE 9.13

      INTELLECTUAL
PROPERTY

       

      Registered
Trademarks:

       

      1.           “IEC”

      Registration
Number:  1646272

       

      2.          
IEC Logo

      Registration
Number:  1650337

       

      Registered
Copyrights:

       

      1.          
Type of Work: Text

      Registration
Number:  TXu000800909

      Application
Title:  The IEC UCW Menu System.

       

      
        
          
          

        

        
          76

          
            

          

        

        
          
          

        

      

       

      SCHEDULE 9.15

      SUBSIDIARIES AND
AFFILIATES

       

      
        
          
            
              
                
                  
                    	
                            Subsidiary Name

                          	 	
                            Jurisdiction of Formation

                          	 	
                            Jurisdictions of
    Qualification

                          
	 	 	 	 	 
	
                            IEC
      Electronics Wire and Cable, Inc.

                          	 	
                            New
      York

                          	 	
                            None

                          
	 	 	 	 	 
	
                            General
      Technology Corporation

                          	 	
                            New
      Mexico

                          	 	
                            California

                          


                  

                

              

            

          

        

      

       

      
        
          
          

        

        
          77

          
            

          

        

        
          
          

        

      

       

      SCHEDULE 9.17

      ERISA
MATTERS

       

      IEC Electronics
Corp.:

       

      IEC
Electronics Corp. 401k Plan

       

      Employee
Profit Sharing Plan

       

      2001
Stock Option and Incentive Plan, which covers employees of the Company and the
Subsidiaries

       

      Management
Incentive Plan

       

      Cafeteria
Plan (Medical/Dental/Flex Spending)

       

      Long Term
Disability Plan

       

      Life
Insurance Plan

       

      IEC Electronics Wire and
Cable, Inc.:

       

      IEC
Electronics Wire and Cable, Inc. 401k Profit Sharing Plan and Trust

       

      IEC
Electronics Wire and Cable, Inc. Section 125 Plan (Health/Dental)

       

      IEC
Electronics Wire and Cable, Inc. Life Insurance Plan

       

      IEC
Electronics Wire and Cable, Inc. Management Incentive Plan

       

      
        
          
          

        

        
          78

          
            

          

        

        
          
          

        

      

       

      SCHEDULE 12.1

      DEBT

       

      $100,000
Bond held by Crane Fund for Widows and Children

       

      
        
          
          

        

        
          79