Unassociated Document


    SECOND
      AMENDMENT TO CREDIT AGREEMENT 


            SECOND
      AMENDMENT TO
      AMENDED AND RESTATED CREDIT AGREEMENT dated as of November 21, 2005, (the
“Second Amendment”) by and among NU HORIZONS ELECTRONICS CORP., a Delaware
      corporation having its executive offices at 70 Maxess Road, Melville, New York
      (the “Borrower”), each of the lenders that is a signatory thereto identified
      under the caption “Lenders” on the signature pages to the Credit
      Agreement (as defined below) (individually, a “Lender”, and collectively, the
“Lenders”), and CITIBANK, N.A., a national banking association as administrative
      agent for the Lenders (the “Administrative Agent”). 


    RECITALS



            The
      Borrower, certain of
      the Lenders and the Administrative Agent entered into an Amended and Restated
      Credit Agreement dated as of September 30, 2004, as amended by a First Amendment
      dated as of February 28, 2005 (collectively, the “Credit Agreement”), pursuant
      to which certain financial accommodations were made available to the Borrower.
      


            Immediately
      prior to
      entry into this Second Amendment, one of the original Lenders is withdrawing
      from the credit facility and assigning its interests to a new Lender, and,
      effective upon entry into this Second Amendment to Credit Agreement, such new
      Lender and certain of the original Lenders will adjust the amounts of their
      respective Revolving Credit Commitments. 


            The
      Borrower has
      requested that the Lenders and the Administrative Agent modify certain of the
      terms set forth in the Credit Agreement and the Lenders and the Administrative
      Agent are willing to comply with such request but only upon and subject to
      the
      following terms and conditions. 


            NOW
      THEREFORE, in consideration of the premises and mutual covenants and
      promises exchanged herein, the parties hereto mutually agree as follows:



            Section
      1.
Definitions. Except as otherwise defined in this Second Amendment, terms
      defined in the Credit Agreement are used herein as defined therein. 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


            Section
      2.
Amendments. Subject to the satisfaction of the conditions precedent
      specified in Section 3 below, the Credit Agreement shall be amended as follows:
      

    1. Section
      1.1 of
      the Credit Agreement is hereby amended by (a) deleting the definitions of
“Borrowing Base”, “Domestic Subsidiary”, “Foreign Subsidiary”, “Guarantee”,
“Guarantors”, “Loan Documents”, “Low Leverage Period”, “Margin”, “Modified Quick
      Ratio”, “Permitted Acquisition”, “Rolling Two Quarter EBIT” and substituting the
      following therefor: 


    
      	 
	““Borrowing
              Base” shall mean: the lesser of (i) the amount of the Total Revolving
              Credit Commitment or (ii) 80% of the Eligible Accounts plus the lesser
              of
              (a) 40% of the Eligible Inventory as reported on the most recent Borrowing
              Base Certificate delivered pursuant to Section 5.1 (12) hereof or (b)
              $50,000,000; provided, however, if such certificate has not been provided
              the Borrowing Base shall be deemed to be
              zero.”


    

     

    
      	 
	““Domestic
              Subsidiary” shall mean, as to any Person, any
              Subsidiary of such Person organized under the laws of the United States
              of
              America or any state thereof.”


    



    
      	 
	““Foreign
              Subsidiary” shall mean, as to any Person, any
              Subsidiary of such Person which is not organized under the laws of
              the
              United States of America or any state
              thereof.”


    



    
      	 
	““Guarantee”
              shall mean collectively the Guarantee and
              Reaffirmation and Acknowledgment of Guaranty in the forms prepared
              by
              counsel to the Administrative Agent to be executed and delivered by
              each
              Guarantor on the date of the Second Amendment and thereafter by any
              Domestic Subsidiaries of the Borrower required to deliver a Guarantee
              pursuant to Section 5.11 hereof, as the same may hereafter be amended,
              restated, supplemented or otherwise modified from time to
              time.”


    



    
      	 
	““Guarantors”
              shall mean collectively NIC Components Corp. a
              New York corporation, Nu Horizons International Corp. a New York
              corporation, NUV Inc. (formerly known as Nu Visions Manufacturing,
              Inc.) a
              Massachusetts corporation, Titan Supply Chain Services Corp. (formerly
              known as Titan Logistics Corp.) a New York corporation, Razor Electronics,
              Inc. (formerly known as Hunter Electronics, Inc.) a New York corporation,
              NuXChange B2B Services, Inc., a Delaware corporation and each other
              Domestic Subsidiary of the Borrower which, from time to time hereafter,
              is
              required to execute a Guarantee in accordance with Section 5.11 hereof.
              


    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    



    
      	 
	““Loan
              Documents” shall mean, collectively, this Agreement,
              the Revolving Credit Notes, documents executed in connection with a
              Letter
              of Credit, the Security Agreements and any reaffirmations thereof,
              the
              Guarantee and any reaffirmations thereof, the Pledge Agreement and
              any
              reaffirmations thereof, the Control Agreement, the Blocked Account
              Agreement and any other documents executed by the Borrower or the
              Guarantors in connection herewith including any and all amendments
              to such
              documents.”


    



    ““Low
      Leverage Period” [Reserved].”

    ““Margin”
      shall mean 1.75 percent per annum.”

    ““Modified
      Quick Ratio” [Reserved].”



    
      	 
	““Permitted
              Acquisition” shall mean an acquisition by the
              Borrower or any Subsidiary of the Borrower by merger, by consolidation
              or
              by purchase of a voting majority of the stock of another Person or
              the
              purchase of all or substantially all of the assets of another Person
              (or
              of a division or other operating component of another Person) (an
              “Acquisition”) if all of the following conditions are met:
              


    



    
      	
            	
                  (i)       
                The total consideration, including the cash purchase price for such
                Acquisition and any Funded Debt incurred or assumed in connection
                therewith, does not exceed $15,000,000 and the aggregate total
                consideration for all Acquisitions consummated during the Commitment
                Period does not exceed $25,000,000;


            


    



    
      	
            	
                  (ii)       
                The Acquisition is identified as a “Permitted Acquisition” by the Borrower
                in writing to the Administrative Agent provided that, prior to 11/30/04,
                any Acquisition otherwise qualifying as a Permitted Acquisition will
                require the affirmative consent of all the Lenders;
                

            


    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    



    
      	
                  (iii)       
                The Borrower and its Subsidiaries have not closed more than two (2)
                Acquisitions in any twelve (12) month period and four (4) Acquisitions
                during the Commitment Period; 

            


    



    
      	
            	
                  (iv)       
                No Acquisition shall be a Permitted Acquisition if the business which
                is
                the subject of such acquisition has a negative EBITDA for the most
                recently concluded four quarters;


            


    



    
      	
            	
                  (v)       
                Substantially all of the revenue of the Person or assets being acquired
                is
                derived from products and services substantially similar to those
                currently provided by the Borrower and/or its Subsidiaries;
                

            


    



    
      	
            	
                  (vi)       
                The Administrative Agent and the Lenders shall have received at least
                three (3) years of historical financial statements of such Person
                (or, if
                such Person has been in business for less than three (3) years, financial
                statements for such lesser number of years) and a set of projections
                setting forth in reasonable detail (with those stated assumptions
                set
                forth below) the pro forma effect of such Acquisition and showing
                compliance by the Borrower with all covenants set forth in this Agreement
                for the next succeeding four (4) fiscal quarters. The projections
                to be
                delivered hereunder shall include and specify the assumptions used
                to
                prepare such projections regarding growth of sales, margins on sales
                and
                cost savings resulting from such Acquisition;


            


    

     


    
      	
            	
                  (vii)       
                The Administrative Agent and the Lenders shall have received a certificate
                signed by the chief financial officer of the Borrower to the effect
                that
                (and including calculations indicating that) on a pro forma basis
                after
                giving effect to such Acquisition: (a) all representations and warranties
                contained in the Loan Documents will remain true and correct except
                those,
                if any, made as of a specific time which shall have been true and
                correct
                when made, (b) the Borrower will remain in compliance with all covenants
                contained in the Loan Documents, and (c) no Default or Event of Default
                has occurred and is continuing or will occur as a result of the
                consummation of such Acquisition; 

            


    

    
       

    

    
      	
            	
                  (viii)       
                With respect to such Person which is the subject of an Acquisition,
                such
                Acquisition has been (x) approved by the board of directors or other
                appropriate governing body of such Person or (y) recommended for
                approval
                by such board of directors or governing body to the shareholders,
                members,
                partners, or other owners of such Person, as required under applicable
                law
                or the certificate of incorporation and by-laws or other organizational
                documents of such Person and subsequently approved by the shareholders,
                members, partners or other owners if such approval is required under
                applicable law or by the certificate of incorporation and by-laws
                or other
                organizational documents of such Person or (z) otherwise agreed to
                by all
                shareholders, members, partners or owners of such Person;
                

            


    



    
      	
            	
                  (ix)       
                The Borrower has timely delivered the financial statements required
                pursuant to Section 5.1(1) and 5.1(2) hereof;


            


    



    
      	
            	
                  (x)       
                The Borrower and such other Person, if any, has complied with the
                provisions of Section 5.11 hereof; and


            


    



    
      	
            	
                  (xi)       
                The Acquisition constitutes a Domestic Acquisition, as herein after
                defined. Domestic Acquisition shall mean the acquisition by the Borrower
                or any Subsidiary of the Borrower of more than 50% of the capital
                stock,
                membership interests, partnership interests or other similar ownership
                interests of a Person organized under the laws of the United States
                or any
                state thereof or the purchase of all or substantially all of the
                assets
                owned by such Person substantially all of which assets are located
                in the
                United States.”

            


    

    ““Rolling
      Two Quarter EBIT” [Reserved].”


    and (b)
      adding new definitions of “Blocked Account”, “Blocked Account Agreement”,
“Control Agreement” and “Pledge Agreement” to read as follows: 

    ““Blocked
      Account”
      shall
      have the meaning ascribed thereto in the Blocked Account Agreement.@

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    
      
        	 
	       ““Blocked
                Account
                Agreement” shall mean, collectively, the blocked account agreement by
                and between the Borrower, NIC Components Corp., Nu Horizons International
                Corp., Titan Supply Chain Services Corp. and Razor Electronics, Inc.,
                as
                applicable, and the Administrative Agent in the form of Exhibit E
                hereto.”


      
        



    
      	 
	        ““Control
              Agreement” shall mean, collectively, the agreement(s) regarding the
              Mellon Bank, N.A. concentration deposit accounts of the Borrower, NIC
              Components Corp., Nu Horizons International Corp., Titan Supply Chain
              Services Corp. and Razor Electronics, Inc. (collectively, the “Control
              Agreement Guarantors”) by and among the Borrower, or the Control Agreement
              Guarantors, as applicable, Mellon Bank, N.A. and the Administrative
              Agent
              in the form of Exhibit D hereto. 


    



    
      	 
	        ““Pledge
              Agreement” shall mean (a) with respect to the Borrower, any Pledge
              Agreement entered into in accordance with Section 5.11 hereof relating
              to
              the capital stock or other equity interests of a Foreign Subsidiary
              of the
              Borrower substantially in the form prepared by counsel to the
              Administrative Agent, (b) with respect to each Domestic Subsidiary,
              as
              applicable, any Pledge Agreement entered into in accordance with Section
              5.11 hereof relating to the capital stock or other equity interests
              of a
              Foreign Subsidiary which is a Subsidiary of a Domestic Subsidiary of
              the
              Borrower substantially in the form prepared by counsel to the
              Administrative Agent and as each of the same may hereafter be amended,
              restated, supplemented or otherwise modified from time to
              time.”


    



    2.       
      Section 2.8 of the Credit
      Agreement is hereby deleted and “[Reserved]” is substituted therefor.


    3.       
      Section 2.9 (a) of the
      Credit Agreement is hereby deleted and the following is substituted therefor:
      


    
      	 
	        “2.9
Commitment
              Fees; Other Fees. (a) Commitment Fees. As additional compensation for
              the Revolving Credit Commitments, the Borrower agrees to pay to the
              Administrative Agent for the pro rata benefit of the Lenders a commitment
              fee for the Commitment Period based on the average daily unused portion
              of
              the Total Revolving Credit Commitment (without reference to the Borrowing
              Base) of .25% which fee shall accrue from the date of the Second
              Amendment. 


    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     


    
      	 
	        Any
              fee payable
              under this Section 2.9 which is not paid when due shall bear interest
              at
              the Involuntary Rate until paid, payable on demand. Such fee shall
              be
              computed on the basis of a 360 day year for the actual days elapsed
              for
              the Relevant Period and shall be payable monthly on the first day of
              each
              month during the Commitment Period and on the Termination Date or any
              earlier date of termination in accordance with the terms of this
              Agreement. The “unused portion of the Total Revolving Credit Commitment”
              means, at any time, the Total Revolving Credit Commitment less the
              sum of
              (a) the unpaid principal balance of all Revolving Credit Loans and
              (b) the
              Letter of Credit Exposure. Upon termination or reduction of the Revolving
              Credit Commitments or adjustment of the Lenders’ percentage of Total
              Revolving Credit Commitments, the Borrower will pay to the Administrative
              Agent, for the pro rata account of the Lenders, accrued unused fees
              on the
              portion of the Revolving Credit Commitment terminated or reduced to
              the
              date of termination or reduction.”


    



        4.       
      A
      new Section 3.15 entitled Security Agreements and Pledge Agreements is added
      to
      the Credit Agreement to read as follows: 


    
      	 
	        “3.15
Security
              Agreements and Pledge Agreements: Each Security Agreement and Pledge
              Agreement executed by the Borrower and each Domestic Subsidiary, as
              applicable, shall, pursuant to its terms and applicable law, constitute
              a
              valid and continuing lien on and security interest in the collateral
              referred to in such Security Agreement and such Pledge Agreement in
              favor
              of the Administrative Agent, for the ratable benefit of the Lenders,
              which
              shall be prior to all other Liens, claims and rights of all other Persons
              in such collateral which may be perfected under the laws of any state
              of
              the United States of America except Liens permitted by the terms
              hereof.”


    



        5.       
      Section 5.11 of the Credit Agreement is hereby deleted and the following is
      substituted therefor: 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     



    
      	 
	
              “5.11
New
                Subsidiaries. Give the Administrative Agent prompt written notice of
                the creation, establishment or acquisition, in any manner, of any
                Subsidiary not existing on the date of the Second Amendment. The
                Borrower
                (a) shall cause any Domestic Subsidiary formed after the date of
                this
                Agreement to become a Guarantor of all debts and obligations of the
                Borrower under this Agreement and cause such Domestic Subsidiary
                to
                execute a Guarantee and a Security Agreement together with related
                security agreement questionnaires and UCC-1 financing statements
                which
                shall be acceptable to the Administrative Agent in all respects and
                (b)
                the Borrower or a Domestic Subsidiary of the Borrower, as appropriate,
                shall execute a Pledge Agreement in the form provided by counsel
                to the
                Administrative Agent, with respect to the capital stock or other
                equity
                interest of any Foreign Subsidiary formed after the date of the Second
                Amendment to be pledged to the Agent for the pro rata benefit of
                the
                Lenders pursuant to the Pledge Agreement or an amendment thereto
                and
                deliver to the Agent the stock certificates, if any, evidencing the
                shares
                or other interests pledged under such Pledge Agreement together with
                stock
                powers executed in blank. In no event shall the Borrower or a Domestic
                Subsidiary be required to pledge any of the assets of a Subsidiary
                that is
                a controlled foreign corporation, as defined in Section 957(a) of
                the
                Internal Revenue Code, including, but not limited to the stock of
                any
                Subsidiary held directly or indirectly by any such Subsidiary. In
                the case
                of both (a) and (b) above, within ten (10) days after the creation,
                establishment, or acquisition of such Subsidiary, the Borrower and
                or a
                Domestic Subsidiary shall deliver or cause to be delivered such proof
                of
                corporate action, incumbency of officers, opinions of counsel and
                other
                documents as are consistent with those delivered as to each Subsidiary
                pursuant to Section 4.1 hereof or as the Administrative Agent shall
                request, each in form and substance satisfactory to the Administrative
                Agent.”

            


    



        6.       
      The
      Credit Agreement is hereby amended by adding a new Section 5.12 to read as
      follows: 


    
      	 
	        “5.12
Collection
              of Accounts. (a) In the event that the Borrower is in default of (1)
              the Minimum Excess Availability covenant contained in Section 6.3 of
              this
              Agreement and, provided there is at least $1.00 of Excess Availability,
              such default continues for a period of fifteen (15) days or (2) the
              provisions of Section 8(a) hereof, after giving effect to any period
              of
              grace, then in each instance and in addition to any other rights of
              the
              Administrative Agent or the Lenders and/or remedies available to the
              Administrative Agent under the Loan Documents (y) the Administrative
              Agent
              shall give the Notice of Exclusive Control under the Control Agreement,
              for the Borrower’s and the Control Agreement Guarantors’ cash
              concentration account(s) at Mellon Bank, N.A. and, in addition, (z)
              the
              Administrative Agent shall (A) require the Borrower to deposit, promptly
              upon receipt, all payments on Accounts and all proceeds of other
              collateral securing the Revolving Credit Loans in the identical form
              in
              which such payments are made, whether by cash, check or other manner,
              into
              the Blocked Account, (B) cause the Borrower to give notice to all account
              debtors to deposit all payments on Accounts, whether by cash, check
              or
              other manner, into the Blocked Account, and (c) give the Notice of
              Full
              Dominion under the Blocked Account Agreement. The Borrower and each
              Domestic Subsidiary hereby agree that all payments made to the Blocked
              Account or other funds received and collected by the Administrative
              Agent,
              whether on the Accounts or as proceeds of other collateral or otherwise,
              shall be the property of the Administrative Agent for the pro rata
              benefit
              of the Lenders. Neither the Borrower nor any Domestic Subsidiary shall
              be
              entitled to make withdrawals from the Blocked Account except in accordance
              with the terms of the Blocked Account Agreement.



    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    



    
      	
              
              

            	
              (b) Such
                payments or other funds received pursuant to Section
                5.12(a) hereof will be applied (conditional upon final collection)
                in the
                manner specified in the Blocked Account Agreement.
                

            


    

     

    
      	 
	(c)
              In the event that subsection (a) is applicable, the Borrower
              and all of its Affiliates, Subsidiaries, shareholders, directors,
              employees or agents shall, acting as trustee for the Administrative
              Agent,
              receive, as the property of the Administrative Agent for the pro rata
              benefit of the Lenders, any monies, checks, notes, drafts or any other
              payment relating to and/or proceeds of Accounts or other collateral
              which
              come into their possession or under their control and immediately upon
              receipt thereof, shall deposit or cause the same to be deposited in
              the
              Blocked Account, or otherwise remit the same or cause the same to be
              remitted, in kind, to the Administrative Agent. In no event shall the
              same
              be commingled with any of the Borrower’s own funds.



    



    
      	
            	
              (d) If
                there has occurred a Full Dominion Effective Date as
                defined in and provided for in the Blocked Account Agreement due
                to a
                violation of Section 6.3 hereof, the Administrative Agent’s control over
                the Blocked Account will remain in effect until such time as the
                Borrower
                has maintained Minimum Excess Availability, as defined in Section
                6.3
                hereof, for a consecutive two (2) month period as reflected in the
                Borrowing Base Certificates delivered pursuant to Section 5.1 (12)
                hereof.
                Upon satisfaction of such condition the Administrative Agent shall
                give
                the Notice of Termination of Exclusive Control under the Control
                Agreement
                and give the Notice of Termination of Full Dominion under the Blocked
                Account Agreement .”

            


    

    
       

          7.       
        The
        Credit Agreement is hereby amended by adding a new Section 5.13 to read as
        follows: 

       

    


    
      	 
	        “5.13
Cash
              Concentration Accounts. Maintain and cause its Domestic Subsidiaries
              to maintain any cash concentration accounts subject to the Lien of
              the
              Administrative Agent and in furtherance thereof enter into and maintain
              the Control Agreement.”


    



        8.       
      Section 6.2 of the Credit Agreement is hereby deleted and the following is
      substituted therefor: 


    
      	 
	        “6.2
Capital
              Base. Maintain a minimum Capital Base, as defined herein, as at
              8/31/05 and at the end of each fiscal quarter thereafter of at least
              the
              sum of $120,000,000 plus 75% of cumulative consolidated quarterly net
              income of the Borrower and its Subsidiaries after 8/31/05. In addition,
              75% of the net proceeds received by the Borrower or its Subsidiaries
              from
              any equity offering will be added to the applicable Capital Base amount
              required as set forth above for the next succeeding fiscal quarter
              and in
              each fiscal quarter thereafter. Net losses, if any, will not be deducted
              from the applicable calculation of Capital Base. “Capital Base” shall mean
              for the Borrower and its Subsidiaries on a consolidated basis the sum
              of
              Tangible Net Worth plus Subordinated
              Debt.”


    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


     

    9.
      The Credit Agreement is hereby amended by adding a new Section 6.2.5
      to read as follows:



    
      	 
	        “6.2.5
Domestic
              Capital Base. Maintain a minimum Domestic Capital Base, as defined
              herein, as at 8/31/05 and at the end of each fiscal quarter thereafter
              of
              at least the sum of $105,000,000 plus 75% of cumulative consolidated
              quarterly net income of the Borrower and its Domestic Subsidiaries
              after
              8/31/05. In addition, 75% of the net proceeds received by the Borrower
              or
              its Domestic Subsidiaries from any equity offering will be added to
              the
              applicable Domestic Capital Base amount required as set forth above
              for
              the next succeeding fiscal quarter and in each fiscal quarter thereafter.
              Net losses, if any, will not be deducted from the applicable calculation
              of Domestic Capital Base. “Domestic Capital Base” shall mean for the
              Borrower and its Domestic Subsidiaries on a consolidated basis the
              sum of
              Tangible Net Worth plus Subordinated Debt, in each case, of the Borrower
              and its Domestic Subsidiaries.”


    



        10.       
      Section 6.3 of the Credit Agreement is hereby deleted and the following is
      substituted therefor: 


    
      	 
	        “6.3
Minimum
              Excess Availability. Maintain at all times an Excess Availability, as
              herein defined, of $10,000,000. Excess Availability means the amount
              of
              Revolving Credit Loans which would be available if the Borrowing Base
              was
              calculated without giving effect to the limitations on the maximum
              amount
              of same imposed by reference to the definition of Total Revolving Credit
              Commitments, less the sum of the amounts of Revolving Credit Loans
              outstanding and the Letter of Credit
              Exposure.”


    



        11.       
      Section 6.4 of the Credit Agreement is hereby deleted and “[Reserved]” is
      substituted therefor. 


        12.       
      Section 6.5 of the Credit Agreement is hereby deleted and the following is
      substituted therefor: 


    
      	 
	        “6.5
Maximum
              Net
              Loss. (a) Not incur a net loss in excess of $3,000,000 for any fiscal
              quarter and (b) commencing with the fiscal quarter ended 8/31/05, not
              incur a net loss in excess of $6,000,000 as of the end of each fiscal
              quarter for the rolling four fiscal quarters then
              ended.”


    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    



        13.       
      Section 7.1 of the Credit Agreement is hereby deleted and the following is
      substituted therefor: 


    
      	 
	        “7.1
              Indebtedness for Borrowed Money. Incur, or permit to exist, any
              indebtedness for borrowed money except (i) indebtedness incurred pursuant
              to borrowings or other extensions of credit hereunder, (ii) purchase
              money
              indebtedness (y) secured by Liens described in Section 7.2(iv) hereof
              which has an annual debt service requirement of not more than $8,000,000
              in the aggregate inclusive of the annual amounts expended by the Borrower
              for operating leases pursuant to Section 7.7 hereof and (z) incurred
              in
              connection with Nevada CapEx, as defined in Section 6.6 hereof, (iii)
              indebtedness existing on the date of the Second Amendment and reflected
              in
              the financial statements referred to in Section 3.1 hereof and extensions,
              renewals and refinancings thereof (without increase in principal amount),
              (iv) indebtedness incurred in the ordinary course of business exclusive
              of
              that incurred in the borrowing of money, (v) Subordinated Indebtedness,
              (vi) indebtedness incurred by the Foreign Subsidiaries to institutional
              lenders not to exceed $30,000,000 in the aggregate and (vii) other
              indebtedness which shall not exceed in the aggregate, for the Borrower
              and
              all Domestic Subsidiaries, at any time outstanding, the sum of
              $1,000,000.”


    



        14.       
      Section 7.2 of the Credit Agreement is hereby deleted and the following is
      substituted therefor: 


    
      	 
	        “7.2
Liens.
              Create, assume or permit to exist any Lien on any of its property or
              assets now owned or hereafter acquired except (i) Liens in favor of
              the
              Administrative Agent for the benefit of the Lenders; (ii) other Liens
              incidental to the conduct of its business or the ownership of its property
              and assets which were not incurred in connection with the borrowing
              of
              money or the obtaining of advances or credit and which do not materially
              impair the use thereof in the operation of its business; (iii) Liens
              for
              taxes or other governmental charges which are not delinquent or which
              are
              being contested in good faith and for which a reserve shall have been
              established in accordance with GAAP; (iv) purchase money Liens on fixed
              assets granted to secure either the unpaid balance of the purchase
              price
              thereof or a loan made to finance the purchase of such assets, all
              to the
              extent permitted under Section 7.1(ii)(y) and (z) hereof; (v) Liens
              existing on the date of the Second Amendment and disclosed in writing
              to
              the Lenders as indicated on Schedule I hereto and (vi) Liens attaching
              to
              the property of the Foreign Subsidiaries securing indebtedness of the
              Foreign Subsidiaries permitted by Section 7.1 (vi)
              hereof.”


    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    



        15.       
      Section 7.3 of the Credit Agreement is hereby deleted and the following is
      substituted therefor: 

    
      	 
	        “7.3
Loans
              and
              Investments. Lend or advance money, credit or property to or invest in
              (by capital contribution, loan, purchase or otherwise) any firm,
              corporation, or other Person except (i) investments in United States
              Government obligations, certificates of deposit of any banking institution
              with combined capital and surplus of at least $200,000,000 and commercial
              paper of the highest credit rating given by Moody’s Investors Service,
              Inc. or Standard and Poor’s Ratings Services, (ii) the Borrower may make
              loans provided that the aggregate thereof at any time outstanding and
              owing by any one Person shall not exceed $200,000, (iii) investments
              in
              stocks, securities or assets of other Persons which qualify as a Permitted
              Acquisition, (iv) the purchase of up to $1,000,000 of the stock of
              the
              Borrower on behalf of the ESOP valued at the market price at the time
              of
              such purchase, (v) investments in stocks, securities or assets of other
              corporations not meeting the requirements of subsection (iii) above,
              so
              long as such corporation is in the electronics or high tech business;
              provided, however, that (1) the aggregate of such investments shall
              not
              exceed $1,000,000 and (2) such corporation is organized under the laws
              of
              any state of the United States of America, (vi) the purchase of not
              more
              than an aggregate of $4,000,000 of minority interests in the Borrower’s
              Foreign Subsidiaries pursuant to and in accordance with the terms of
              the
              shareholder agreements of such Foreign Subsidiaries (a “Minority Interest
              Purchase”) and (vii) investments by the Borrower and its Domestic
              Subsidiaries in stocks, securities or assets of Foreign Subsidiaries
              or
              loans to Foreign Subsidiaries provided that such investments and loans
              together with the guarantees permitted by Section 7.5 (iii) hereof
              do not
              exceed $60,000,000 in the aggregate reduced by any amount utilized
              for any
              Minority Interest Purchase under subsection (vi)
              above.”


    



        16.       
      Section 7.4 of the Credit Agreement is hereby deleted and the following is
      substituted therefor: 


    
      	 
	        “7.4
Fundamental
              Changes. Wind up, liquidate, or dissolve itself, reorganize, merge or
              consolidate with or into, or convey, sell, assign, transfer, lease,
              or
              otherwise dispose of (whether in one transaction or a series of
              transactions) all or substantially all of its assets, (whether now
              owned
              or hereafter acquired other than sales of inventory and obsolete equipment
              in the ordinary course of business) to any Person, or acquire all or
              substantially all of the assets or the business of any Person except:
              a
              wholly owned Subsidiary of the Borrower may merge into or consolidate
              with
              (1) a wholly owned Subsidiary of the Borrower or (2) the Borrower,
              provided that no Foreign Subsidiary shall merge with and into another
              Foreign Subsidiary if 65% of the shares or other ownership interests
              of
              the surviving Subsidiary cannot be pledged to the Administrative Agent
              for
              the benefit of the Lenders, provided further that in each case that
              immediately after giving effect thereto, the surviving entity is obligated
              under this Agreement and no event shall occur and be continuing which
              constitutes a Default or an Event of
              Default.”


    



        17.       
      Section 7.5 of the Credit Agreement is hereby deleted and the following is
      substituted therefor: 



    
      	 
	        “7.5
Contingent
              Liabilities. Assume, endorse, be or become liable for or guarantee the
              obligations of any Person if, as a result thereof, the aggregate of
              such
              contingent liabilities with respect to any one Person would exceed
              $100,000 excluding, however, (i) the endorsement of negotiable instruments
              for deposit or collection in the ordinary course of business, (ii)
              guarantees given by the Borrower for obligations of its Domestic
              Subsidiaries and guarantees given by Domestic Subsidiaries for the
              obligations of the Borrower and (iii) guarantees by the Borrower and
              its
              Foreign Subsidiaries for obligations of Foreign Subsidiaries permitted
              by
              Section 7.1 (vi) hereof provided that such obligations together with
              investments and loans permitted by Section 7.3 (vii) and Minority Interest
              Purchases permitted by Section 7.3 (vi) do not exceed $60,000,000 in
              the
              aggregate and such guarantees are not secured by any property of the
              Borrower or its Domestic Subsidiaries. Solely for purposes of calculating
              compliance with the provisions of (iii) above, the guaranteed amount
              pursuant to guarantees by the Borrower and/or one or more guarantors
              of
              the same indebtedness obligations shall only be counted
              once.”


    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    



        18.       
      Section 7.6 of the Credit Agreement is hereby deleted and the following is
      substituted therefor: 


    
      	 
	        “7.6
Sales
              of
              Receivables; Sale — Leasebacks. Sell, discount or otherwise dispose of
              notes, accounts receivable or other obligations owing to the Borrower
              or
              its Domestic Subsidiaries, with or without recourse, except for the
              purpose of collection in the ordinary course of business; or sell any
              asset pursuant to an arrangement to thereafter lease such asset from
              the
              purchaser thereof.”


    



        19.       
      Section 7.12 of the Credit Agreement is hereby deleted and the following is
      substituted therefor: 


             “7.12
      Liabilities of Subsidiaries: [Reserved].”


        20.       
      Section 7.14 of the Credit Agreement is hereby deleted and the following is
      substituted therefor: 


    
      	 
	        “7.14
ERISA.
              (a) Terminate and Plan so as to result in any material liability of
              the
              Borrower or any Subsidiary to the PBGC, (b) engage in or permit any
              Person
              to engage in any prohibited Transaction involving any Plan which would
              subject the Borrower or any of its Subsidiaries to any material tax,
              penalty or other liability, (c) incur or suffer to exist any material
              “accumulated funding deficiency” (as defined in Section 202 of ERISA),
              whether or not waived, involving any Plan, or (d) allow or suffer to
              exist
              any event or condition, which presents a material risk of incurring
              a
              material liability of the borrower or any Subsidiary to the PBGC by
              reason
              of termination of any Plan.”


    



        21.       
      Section 8(c) of the Credit Agreement is hereby deleted and the following is
      substituted therefor: 


    
      	
            	
                  (c)       
                The Borrower shall default in the observance or performance of any
                of its
                agreement set forth in Sections 5.11, 6 (other than Section 6.3 unless
                there is less than $1.00 of Excess Availability) or 7 hereof
                or”

            


    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

        22.       
      Section 8(i) of the Credit Agreement is hereby deleted and the following is
      substituted therefor: 

     


    
      	
            	
                  “(i)       
                A Loan Document shall cease, for any reason, to be in full force
                and
                effect or shall be declared null and void, a default shall occur
                thereunder or any party thereto shall assert that it has no further
                obligation to a Lender or the Administrative Agent thereunder (unless
                such
                party has been discharged from such obligation under such Loan Document
                by
                such Lender or the Administrative Agent in writing) or any Security
                Agreement or any Pledge Agreement shall for any reason, except to
                the
                extent permitted by this Agreement or any other Loan Document, cease
                to
                create, or the Administrative Agent (for any reason other than termination
                or release as permitted by this Agreement) shall cease to have, for
                the
                benefit of itself and the ratable benefit of the Lenders, a valid,
                enforceable and perfected first priority security interest in the
                Collateral (as defined therein) or any portion thereof, then, in
                any such
                event, any or all of the following actions shall be taken: (i) the
                Administrative Agent with the written consent of the Required Lenders
                may,
                and upon the written request of the Required Lenders shall, by notice
                of
                default to the Borrower, declare the Revolving Credit Commitments
                to be
                terminated forthwith, whereupon the Revolving Credit Commitments
                and all
                obligations of the Lenders to make Revolving Credit Loans or issue
                Letters
                of Credit, shall immediately terminate; (ii) the Administrative Agent
                with
                the written consent of the Required Lenders may, and upon the written
                request of the Required Lenders shall, by notice of default to the
                Borrower, declare the entire amounts due under the Revolving Credit
                Notes
                (with accrued interest thereon) and all other amounts owing under
                this
                Agreement to be immediately due and payable; provided, however, that
                upon
                the happening of an event specified in subsection (f) of this Section
                8,
                the obligation of the Lenders to make further Revolving Credit Loans
                and
                the Issuing Lender to issue Letters of Credit shall terminate and
                the
                Revolving Credit Notes and all other amounts owing under this Agreement
                shall be immediately due and payable without declaration or other
                notice
                to the Borrower. Except as expressly provided above in this Section,
                presentment, demand, protest and all other notices of any kind are
                hereby
                expressly waived.”

            


    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    



        23.       
      Section 10.1 (a) of the Agreement is hereby deleted and the following is
      substituted therefor: 


    
      	
            	
                  “(a) if
                to the Borrower, any Guarantor
                or any of their respective subsidiaries at Nu Horizons Electronics
                Corp.,
                70 Maxess Road, Melville, New York 11747, Attn.: Mr. Paul Durando,
                Vice
                President/Finance with a copy to Kramer, Coleman, Wactlar & Lieberman,
                P.C. 100 Jericho Quadrangle, Suite 225, Jericho, New York 11753,
                Attn:
                Nancy D. Lieberman, Esq.”

            


    



        24.     The
      Credit
      Agreement is hereby amended by adding a new Exhibit D and an Exhibit E in the
      form attached hereto. 



        25.     The
      Revolving
      Credit Commitments of the Lenders are hereby adjusted among the Lenders and,
      to
      reflect such adjustment, Schedule I of the Credit Agreement is hereby deleted
      and the following is substituted therefor: 


    “SCHEDULE
      I


    Revolving
      Credit Commitments (Section 2.1) 


    Facility
      Amount : $100,000,000 


     

    
      
        	
                Bank

              	 	
                Revolving

                Credit
                  Commitment

              	 	
                Percentage
                  of Total

                Revolving
                  Credit Commitment

              	 
	 	 	 	 	 	 
	
                Citibank,
                  N.A.

              	 	
                $

              	
                21,000,000

              	 	 	
                21%

              	
                 

              
	
                Bank
                  of America, N.A.

              	 	
                $

              	
                15,000,000

              	 	 	
                15%

              	
                 

              
	
                JPMorgan
                  Chase Bank, N.A.

              	 	
                $

              	
                15,000,000

              	 	 	
                15%

              	
                 

              
	
                Israel
                  Discount Bank of New York

              	 	
                $

              	
                14,000,000

              	 	 	
                14%

              	
                 

              
	
                HSBC
                  Bank USA, National Association

              	 	
                $

              	
                10,000,000

              	 	 	
                10%

              	
                 

              
	
                North
                  Fork Bank

              	 	
                $

              	
                10,000,000

              	 	 	
                10%

              	
                 

              
	
                Bank
                  Leumi USA

              	 	
                $

              	
                7,500,000

              	 	 	
                7.5%

              	
                 

              
	
                Sovereign
                  Bank

              	 	
                $

              	
                7,500,000

              	 	 	
                7.5%

              	
                 

              


      

    

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Section
      3. Conditions
      Precedent.
      The
      amendments to the Credit Agreement set forth in Section 2 hereof shall become
      effective, on the date of this Second Amendment, upon the execution and delivery
      of this Second Amendment by the Borrower, the Administrative Agent and each
      of
      the Lenders and the satisfaction of the following conditions:

    


    (A) Notes.
      Each
      Lender shall have received a revolving credit note in the amount of its
      Revolving Credit Commitment, as set forth on Schedule I, duly executed by the
      Borrower. Such notes shall replace and supercede the notes originally dated
      September 30, 2004; provided, however, such replacement shall not be deemed
      to
      have terminated or discharged the Borrower=s
      grant
      of the security interests securing the original notes.

    


    (B) Guaranty;
      Reaffirmation of Guaranty.
      The
      Administrative Agent shall have received a Guaranty from NuXChange B2B Services,
      Inc. and a reaffirmation and acknowledgment of the Guaranty duly executed by
      each of the other Domestic Subsidiaries.

    


    (C) Amended
      and Restated Security Agreement.
      The
      Administrative Agent shall have received an amended and restated Security
      Agreement duly executed by the Borrower and each of its Domestic Subsidiaries
      together with UCC-3 amendments in favor of the Administrative Agent for the
      benefit of the Lenders amending the collateral to include all assets of the
      Borrower and each of its Domestic Subsidiaries, and Uniform Commercial Code
      searches and security agreement questionnaires. 

    


    (D) Pledge
      Agreement.
      The
      Administrative Agent shall have received a Pledge Agreement duly executed by
      the
      Borrower pledging the equity interests specified of the Foreign Subsidiaries
      named therein together with all stock certificates, if any, evidencing the
      shares pledged under the Pledge Agreement together with stock powers for such
      shares executed in blank.

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (E) Control
      Agreement and Blocked Account Agreement.
      The
      Administrative Agent shall have received (i) the Control Agreement(s) in the
      form of Exhibit D for the Borrower=s
      and the
      Control Agreement Guarantors=
      cash
      concentration account(s) at Mellon Bank, N.A. duly executed by the Borrower
      and
      Mellon Bank, N.A. and (ii) a Blocked Account Agreement in the form of Exhibit
      E
      for the Borrower=s
      blocked
      account at the Administrative Agent. 

    


    (F)
       Certified
      Copies and Other Documents.
      The
      Administrative Agent shall have received the following with respect to the
      Borrower and, unless otherwise indicated below, the Guarantors:

    


    (i) for
      the
      Borrower and each Subsidiary, certificates of good standing from the Secretary
      of State of New York if incorporated under the laws of the State of New York
      or
      doing business in New York and, if incorporated in a jurisdiction other than
      New
      York, from the Secretary of State or other applicable Governmental Authority
      of
      such jurisdiction of incorporation and from the Secretary of State or other
      applicable Governmental Authority of each jurisdiction in which an office is
      maintained except any jurisdiction where the failure to be qualified would
      not
      have a material adverse effect;

     

    (ii)
       certificates
      of an officer of the Borrower dated the date of this Second Amendment certifying
      (x) no changes in the certificate of incorporation or by-laws from the date
      of
      the Agreement or attaching copies of any amendments, (y) true and correct copies
      of resolutions adopted by the board of directors of the Borrower (1) authorizing
      the borrowings and the other extensions of credit from the Lenders under the
      Agreement as amended hereby, the execution, delivery and performance by the
      Borrower of this Second Amendment, the Pledge Agreement and the Amended and
      Restated Security Agreement and any related documents (2) approving forms in
      substantially execution form of this Second Amendment, the Pledge Agreement
      and
      the Amended and Restated Security Agreement and (3) authorizing officers of
      the
      Borrower to execute and deliver this Second Amendment, the Pledge Agreement
      and
      the Amended and Restated Security Agreement and any related documents, and
      (z)
      the incumbency and specimen signatures of the officers of the Borrower executing
      any documents delivered to the Administrative Agent or a Lender by the Borrower
      in connection herewith; and

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (iii) certificates
      of an officer of each Guarantor dated the date of this Second Amendment
      certifying, (w) no changes in the certificate of incorporation (or equivalent)
      or by-laws (or equivalent) from the date of the Agreement or attaching copies
      of
      any amendments, (x) true and correct copies of resolutions adopted by the board
      of directors of each Guarantor (1) authorizing the execution, delivery and
      performance by such Guarantor of the Guaranty or Reaffirmation and
      Acknowledgment of Guaranty, as applicable, and the Amended and Restated Security
      Agreement and any related documents (2) approving forms in substantially
      execution form of the Guaranty or Reaffirmation and Acknowledgment of Guaranty,
      as applicable, and the Amended and Restated Security Agreement, and (3)
      authorizing officers of such Guarantor to execute and deliver the Guaranty
      or
      Reaffirmation and Acknowledgment of Guaranty, as applicable, and the Amended
      and
      Restated Security Agreement and any related documents, (y) the incumbency and
      specimen signatures of the officers of such Guarantor executing any documents
      delivered to the Administrative Agent or a Lender by such Guarantor in
      connection herewith, and (z) true and correct copies of resolutions adopted
      by
      the shareholders of such Guarantor authorizing the execution and delivery of
      the
      Guaranty or Reaffirmation and Acknowledgment of Guaranty, as applicable, and
      the
      Amended and Restated Security Agreement.

    


    (G) Collateral
      Audit.
      The
      Administrative Agent shall have conducted a Field Audit, at the expense of
      the
      Borrower, which shall in all respects be satisfactory to the Administrative
      Agent.

    


    (H) Inventory
      Appraisal.
      The
      Administrative Agent shall have received an appraisal of the inventory, at
      the
      expense of the Borrower, which shall in all respects be satisfactory to the
      Administrative Agent. 

    


    (i) Legal
      Opinion.
      The
      Administrative Agent and each Lender shall have received a favorable opinion
      of
      counsel to the Borrower and the Guarantors satisfactory in form and substance
      to
      the Administrative Agent and the Lenders and covering such matters incident
      to
      the transactions contemplated by this Second Amendment as the Administrative
      Agent shall reasonably require.

    


    (J) Approval
      of the Administrative Agent and Agent=s
      Counsel.
      All
      other documents and legal matters in connection with the transactions
      contemplated by this Second Amendment shall be satisfactory in form and
      substance to the Administrative Agent and its counsel.

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    Section
      4. Representations
      and Warranties.
      The
      Borrower represents and warrants to the Banks that the representations and
      warranties set forth in the Credit Agreement and in the other Loan Documents
      are
      true and complete on the date of this Second Amendment and as if made on and
      as
      of the date hereof (or, if such representation or warranty is expressly stated
      to have been made as of a specific date, as of such specific date).

    


    Section
      5. Governing
      Law; Execution in Counterparts.
      Except
      as herein provided, the Credit Agreement shall remain unchanged and in full
      force and effect. This Second Amendment may be executed in any number of
      counterparts, all of which taken together shall constitute one and the same
      amendatory instrument and any of the parties hereto may execute this Second
      Amendment by signing any such counterpart. This Second Amendment shall be
      governed by, and construed in accordance with, the internal laws of the State
      of
      New York (without regard to New York conflicts of laws principles).

    


    Section
      6. Expenses,
      etc.
      The
      Borrower agrees (a) to pay to the Administrative Agent for the pro rata benefit
      of the Lenders, an amendment fee in the amount of $50,000 and (b) to pay or
      reimburse the Administrative Agent for all reasonable out-of-pocket costs and
      expenses of the Administrative Agent (including, without limitation, the
      reasonable fees and expenses of Goetz & Mady-Grove, LLP) in connection with
      the negotiation, preparation, execution and delivery of this Second Amendment
      and the transactions contemplated hereby. 

    


    Section
      7. Effective
      Date.
      This
      Second Amendment is dated for convenience as of November 21, 2005 and shall
      be
      effective as of such date, on the delivery of an executed counterpart to the
      Borrower upon satisfaction of the conditions precedent contained in Section
      3
      hereof.

    


    [REMAINDER
      OF THIS PAGE LEFT BLANK INTENTIONALLY] 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF,
      the
      parties hereto have caused this Second Amendment to Credit Agreement to be
      duly
      executed and delivered by their duly authorized officers, all as of the day
      and
      year first above written.

     

    
      	 	 	 
	 	
              Borrower:

              NU
                HORIZONS ELECTRONICS CORP.

            
	 	 	 
	 	By:  	/s/ Paul
              Durando
	 	
              

              Paul
                Durando

              Vice
                President/Finance

            


    

    
      
        	 	 	 
	 	 	 
	 	
                Administrative
                  Agent:


                CITIBANK,
                  N.A., as Administrative Agent

              
	 	 	 
	 	By:  	/s/ Stuart
                N. Berman
	 	
                

                Stuart
                  N. Berman

                Vice
                  President

              


      

      
        	 	 	 
	 	 	 
	 	
                Documentation
                  Agent:

                BANK
                  OF AMERICA, N.A., as
                  Documentation Agent

              
	 	 	 
	 	By:  	/s/ Steven
                J. Melicharek
	 	
                

                Steven
                  J. Melicharek

                Senior
                  Vice President

              


      

      
        	 	 	 
	 	 	 
	 	
                Syndication
                  Agent:

                JPMORGAN
                  CHASE BANK, N.A., as
                  Syndication Agent

              
	 	 	 
	 	By:  	/s/ Louise
                Duchi
	 	
                

                Louise
                  Duchi

                Vice
                  President

              


      

    

    
      
        	 	 	 
	 	 	 
	 	
                Syndication
                  Agent:

                HSBC
                  BANK USA, NATIONAL ASSOCIATION,
                  as Syndication Agent

              
	 	 	 
	 	By:  	/s/ Christopher
                J. Mendelsohn
	 	
                

                Christopher
                  J. Mendelsohn

                First
                  Vice President

              


      



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    
      	 Notice
              Addresses:	 Lenders:
	 	 	 
	 	CITIBANK,
              N.A.
	 	 	 
	CITIBANK,
              N.A.	By:  	/s/ Stuart
              N. Berman
	
              
                730
                  Veterans Memorial Highway

                Hauppauge,
                  NY 11788    

              

            	
              
Stuart
              N. Berman
              Vice
                President

            


    

    
      	 	 	 
	 	 	 
	 	BANK
              OF AMERICA, N.A.
	 	 	 
	BANK
              OF AMERICA, N.A.	By:  	/s/ Steven
              J. Melicharek
	
              1185
                Avenue of the Americas

              New
                York, NY 10036

            	
              

              Steven
                J. Melicharek

              Senior
                Vice President

            


    

    
      	 	 	 
	 	 	 
	 	JPMORGAN
              CHASE BANK, N.A.
	 	 	 
	JPMORGAN
              CHASE BANK, N.A.	By:  	/s/ Louise
              Duchi
	
              395
                North Service Road, Floor 3

              Melville,
                NY 11747

            	
              

              Louise
                Duchi

              Vice
                President

            


    

    
      	 	 	 
	 	 	 
	 	ISRAEL
              DISCOUNT BANK OF NEW YORK
	 	 	 
	
              ISRAEL
                DISCOUNT BANK OF
                NEW YORK

            	By:  	/s/ Scott
              Fishbein
	
              511
                Fifth Avenue

              New
                York, NY 10017

            	
              

              Scott
                Fishbein

              First
                Vice President

            


    

    
      	 	 	 
	 	 	 
	 	By:  	/s/ Matilde
              Reyes
	 	
              
                

              

              Matilde Reyes

              First Vice
                President

            


    

    
      	 	 	 
	 	 	 
	 	HSBC
              BANK USA, NATIONAL ASSOCIATION
	
               

            	 	 
	HSBC
              BANK USA, NATIONAL ASSOCIATION	By:  	/s/ Christopher
              J. Mendelsohn
	
              534
                Broad Hollow Road

              Melville,
                NY 11747


            	
              

              Christopher
                J. Mendelsohn

              First
                Vice President

            


    

    
      	 	 	 


    

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
    

     

    
      	 	 	 
	 	NORTH
              FORK BANK
	 	 	 
	NORTH
              FORK BANK	By:  	/s/ Robert
              J. Milas
	275
              Broadhollow Road
              Melville,
                NY 11747

            	
              

              Robert
                J. Milas

              Vice
                President

            


    

    
      	 	 	 
	 	 	 
	 	BANK
              LEUMI USA
	 	 	 
	BANK
              LEUMI USA	By:  	/s/ Paul
              Tine
	
              
                48
                  South Service Road

                Suite
                  200 

                Melville,
                  NY 11747

              

            	
              
Paul
              Tine
              First
                Vice President

            


    

    
      	 	 	 
	 	 	 
	 	SOVEREIGN
              BANK
	 	 	 
	SOVEREIGN
              BANK	By:  	/s/ Christine
              Gerula
	
              
                3
                  Huntington Quadrangle

                Suite
                  103 South 

                Melville,
                  NY 11747

              

            	
              
Christine
              Gerula
              Senior
                Vice President

            


    

    
 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      
        

          EXHIBIT
            D


          CONTROL
            AGREEMENT (BANK ACCOUNTS)

          


          This
            CONTROL AGREEMENT (BANK ACCOUNTS) dated as of [____________], 2005 (this
            “Agreement”) is made among [_______________] (“Pledgor”), Citibank, N.A., as
            Administrative Agent (“Administrative Agent”), Mellon Bank, N.A. (“Mellon Bank”)
            and Mellon Financial Services Corporation #1 (“MFSC#1”). Mellon Bank and MFSC#1
            are collectively referred to herein as “Mellon”.

          


          The
            parties hereto refer to Account No. [__________] in the name of the Pledgor
            maintained at Mellon Bank (the “Account”) and lockbox [_________] maintained at
            Mellon Bank in accordance with the Mellon Global Cash Management Terms
            and
            Conditions dated October 1, 1994 (“Mellon T&C”). In addition, the parties
            hereto refer to lockbox 21102 maintained at Mellon Financial Services
            Corporation #1 in accordance with the Mellon Financial Services Corporation
            #1
            Global Cash Management Terms and Conditions dated April 1, 1994 (“MFSC #1
            T&C”). Lockboxes
            [________] and [________] are collectively referred to as the “Lockbox”. The
            Mellon T&C and the MFSC#1 T&C are collectively referred to herein as the
“Terms and Conditions”. The parties hereby agree as follows:

          


          1. Pledgor
            and Administrative Agent notify Mellon that by separate agreement Pledgor
            has
            granted Administrative Agent a security interest in the Account and all
            funds
            therein and rights thereto. Mellon acknowledges being so notified and
            confirms
            that it has no actual knowledge or notice of any restraint, security
            interest,
            lien or other adverse claim in or to the Account or any funds
            therein.

          


          2. Mellon
            shall comply with orders received from Pledgor (without further
            consent from
            Administrative Agent) concerning the Account until Mellon has received
            a notice
            purporting to be signed and sent by the Administrative Agent in substantially
            the form attached as Exhibit A hereto (a “Notice of Exclusive Control”). After
            such receipt, Mellon shall not honor any orders from Pledgor and shall
            comply
            with all withdrawal, transfer, payment and other instructions (collectively,
            “orders”) received from Administrative Agent (without further consent from
            Pledgor) concerning the Account until such time as an Exclusive Control
            Termination Date, as hereinafter defined, has occurred. Any Notice of
            Exclusive
            Control received by Mellon after 1:00
            p.m.
            on any business day shall not be deemed effective until the opening of
            business
            on the next succeeding business day. Orders directing disposition of
            funds will
            apply only to available funds Notwithstanding the foregoing: (i) all
            transactions relating to the Account and any items therein duly consummated
            or
            processed by Mellon prior to its receipt of a Notice of Exclusive Control
            (or
            duly commenced by Mellon prior to any such receipt and so consummated
            or
            processed thereafter) shall be deemed not to constitute a violation of
            this
            Agreement; (ii) Mellon may (at its discretion and without any obligation
            to do
            so) commence honoring solely Administrative Agent’s orders concerning the
            Account at any time or from time to time after it becomes aware that
            Administrative Agent has sent to it a Notice of Exclusive Control (including
            without limitation reversing or redirecting any transaction referred
            to in
            clause (i) above) with no liability whatsoever to Pledgor or Administrative
            Agent or any other party for doing so; and (iii) Mellon shall not change
            the
            name or account number of any Account without having received the Administrative
            Agent’s prior express written consent thereto. In case of any conflict between
            instructions received by Mellon from Administrative Agent and Pledgor,
            the
            instructions from Administrative Agent shall prevail. “Exclusive Control
            Effective Date” means the date of receipt by Mellon of the Notice of Exclusive
            Control in the form of Exhibit A hereto. Such notice shall be in effect
            until
            Mellon has received from the Administrative Agent a written notice of
            Pledgor’s
            satisfaction of the release provisions in the separate documentation
            between
            Pledgor and the Administrative Agent in the form attached as Exhibit
            B hereto,
            and the date of receipt by Mellon of such notice shall be referred to
            as the
“Exclusive Control Termination Date.” Any period between an Exclusive Control
            Effective Date and an Exclusive Control Termination Date shall be referred
            to as
            an Administrative Agent Control Period.

          


          
            
              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

          3. Mellon
            is
            authorized to debit the Account in accordance with Mellon’s customary practices
            with respect to (i) payment of customary fees and charges with respect
            to the
            routine maintenance and operation of the Account and Lockbox (“Fees”) and (ii)
            any items (including, but not limited to, checks, drafts, Automatic
            Clearinghouse (ACH) credits or wire transfers or other electronic transfers
            or
            credits) deposited to the Account and returned or otherwise not collected,
            whether for insufficient funds or any other reason (“Returned Items”), in each
            case as provided for under any agreements between Pledgor and Mellon
            relating to
            the Account. In the event Mellon is unable to obtain sufficient funds
            from such
            charges to cover Fees or Returned Items, Pledgor and, with respect to
            any
            Administrative Agent Control Period, Pledgor and Administrative Agent,
            jointly
            and severally, shall indemnify Mellon for all amounts related to the
            Fees or
            Returned Items incurred by Mellon. Mellon shall neither advance margin
            or other
            credit against the Account, nor hypothecate any funds deposited in the
            Account,
            without the prior written consent of Administrative Agent. Except as
            required by
            law, Mellon shall not agree with any other person or entity that it will
            comply
            with any withdrawal, transfer, payment instructions, or any other orders,
            from
            such person or entity concerning the Account or any funds therein, without
            the
            prior written consent of Administrative Agent and any such agreement
            entered
            into without such consent shall be null and void, provided, however,
            that the
            foregoing shall not apply to any withdrawals, transfers, payment instructions,
            debits or other orders that are the result of any wire drawdowns or ACH
            debits
            to the Account that have been initiated prior to Mellon’s receipt of a Notice of
            Exclusive Control.

          


          4. Mellon
            represents and warrants to Administrative Agent that: (i) Mellon Bank
            constitutes a “bank” (as defined in Section 9-102 of the Pennsylvania Uniform
            Commercial Code (“UCC”)), and (ii) that the jurisdiction (determined in
            accordance with Section 9-304 of the UCC) of Mellon Bank for purposes
            of each
            Account maintained by Pledgor with Mellon Bank shall be the Commonwealth
            of
            Pennsylvania. Mellon will not, without Administrative Agent’s prior written
            consent, amend the Terms and Conditions so that Mellon Bank’s jurisdiction for
            purposes of Section 9-304 of the UCC is other than a jurisdiction permitted
            pursuant to preceding clause (ii). Upon request, Mellon will promptly
            furnish to
            Administrative Agent a copy of the Terms and Conditions. Upon request,
            Mellon
            shall furnish to Administrative Agent, at its address indicated below,
            copies of
            all monthly account statements and other information relating to each
            Account
            that Mellon sends to Pledgor and to disclose to Administrative Agent
            all
            information requested by Administrative Agent regarding the
            Account.

          


          
            
              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

          5. Anything
            to the contrary in this Agreement notwithstanding: (i) Mellon shall have
            only
            the duties and responsibilities expressly set forth in writing herein
            (and in
            its Terms and Conditions as in effect from time to time, all of which
            shall
            apply to the Account to the extent not inconsistent with this Agreement)
            and
            shall not be deemed to be a fiduciary for any party hereto; (ii) Mellon
            shall be
            fully protected in acting or refraining from acting in good faith on
            any written
            notice, instruction or request purportedly furnished to it by Administrative
            Agent in accordance with the terms hereof, in which case the parties
            hereto
            agree that Mellon has no duty to make any further inquiry whatsoever;
            (iii)
unless
            Mellon is grossly negligent or engages in willful misconduct in performance
            or
            non-performance in connection with this Agreement and the Account,
            Pledgor
            and Administrative Agent expressly agree that Mellon's liability shall
            be
            limited to damages directly caused by such breach and in no event shall
            Mellon
            be liable for any incidental, indirect, punitive or consequential damages
            or
            attorneys' fees;
            and
            (iv) the Pledgor and, with respect to any Administrative Agent Control
            Period,
            the Pledgor and the Administrative Agent, jointly and severally, hereby
            indemnify Mellon for, and hold Mellon harmless against, any claim, loss,
            cost,
            liability or expense (including reasonable inside or outside counsel
            fees and
            disbursements) incurred or suffered by any
            party
            in connection herewith
            arising
            out of or in connection with this Agreement or the Account, except as
            may result
            from its willful misconduct or gross negligence.

          


          6. Notwithstanding
            any other provision of this Agreement, Mellon shall not be liable for
            any
            failure, inability to perform, or delay in performance hereunder, if
            such
            failure, inability, or delay is due to acts of God, war, civil commotion,
            governmental action, fire, explosion, strikes, other industrial disturbances,
            equipment malfunction, action, non-action or delayed action on the part
            of the
            Pledgor or Administrative Agent or any other entity or any other events
            or
            circumstances that are beyond Mellon's reasonable control.

          


          7. Any
            amendment, modification or supplementation of this Agreement shall be
            effected
            solely by an instrument in writing executed by all the parties hereto.
            This
            Agreement may not be terminated by the Pledgor unless the prior written
            consent
            of Mellon and the Administrative Agent are obtained. Mellon may terminate
            this
            Agreement: (i) upon ten (10) days prior written notice for cause, or
            (ii) upon
            thirty (30) days' prior written notice without cause, in each case, to
            the
            Pledgor and the Administrative Agent. Administrative Agent may terminate
            this
            Agreement (i) upon ten (10) days prior written notice for cause, or (ii)
            upon
            thirty (30) days' prior written notice without cause, in each case, to
            Mellon.
            Pledgor’s and Administrative Agent’s obligations, if any, to Mellon under this
            Agreement to indemnify, hold harmless and pay amounts owed shall survive
            termination of this Agreement. Administrative
            Agent shall provide a written notice to Mellon when all obligations of
            the
Pledgor
            to Administrative Agent are paid and satisfied in full or when the security
            agreement is terminated.

          


          8. All
            notices shall be in writing and sent (including via facsimile with receipt
            confirmed by telephone) to the parties hereto at their respective addresses
            or
            facsimile or telephone numbers (or to such other address or facsimile
            and
            telephone numbers as any such party shall designate in writing to the
            other
            parties from time to time). Notices shall be
            deemed
            to have been properly given when delivered in person, or when sent by
            facsimile
            or other electronic means and electronic confirmation of error-free receipt
            is
            received, or
            three
            (3) business days after being sent by certified or registered mail, return
            receipt requested, postage prepaid, addressed to the party at the address
            set
            forth below:

          


          
            
              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

          Pledgor:                    
            [_____________________]

          70
            Maxess
            Road

          Melville,
            New York 11747

          Attention: Paul
            Durando

                     
                    Vice
            President/Finance

          Phone: 631-396-5000

          Fax: 631-396-5060

          


          Bank:                 
            Mellon
            Bank, N.A.

          Mellon
            Financial Services Corporation #1

          Mellon
            Client Service Center

          500
            Ross
            Street, Room 1380

          Pittsburgh,
            PA 15262-0001

          Attention: Document
            Control Group Manager

          Phone: 412-234-4172

          Fax:  412-236-7419

          


          Administrative
            Agent:    Citibank,
            N.A.

          730
            Veterans Memorial Highway

          Hauppauge,
            New York 11788

          Attention: Stuart
            N.
            Berman

                                                 
            Vice President

          Phone: 631-265-3430

          Fax: 631-265-4888

          


          9. This
            Agreement: (i) may be signed in any number of counterparts, each of which
            shall
            be an original, with the same effect as if the signatures thereto and
            hereto
            were upon the same instrument; (ii) shall become effective when counterparts
            hereof have been signed by the parties hereto; and (iii) shall be governed
            by
            and construed in accordance with the laws of the Commonwealth of
            Pennsylvania.

          


          10. To
            the
            extent a conflict exists between the terms of this Agreement and the
            Terms and
            Conditions, the terms of this Agreement shall control.

          


          11. The
            provisions of this Agreement shall be binding upon and inure to the benefit
            of
            Mellon, Administrative Agent and Pledgor and their respective successors
            and
            assigns provided that Pledgor and Mellon may not assign any of their
            respective
            rights or obligations hereunder without the prior written consent of
            the
            Administrative Agent, provided however, with respect to Mellon an assignment
            by
            operation of law in connection with a merger or similar transaction will
            not be
            deemed to be an assignment requiring the consent of the Administrative
            Agent.
            Administrative Agent agrees to provide written notice to Mellon if
            Administrative Agent assigns its rights under this Agreement. 

          


          
            
              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

          IN
            WITNESS WHEREOF,
            the
            parties hereto have duly executed this Agreement as of the date first
            above
            written.

          


          [______________________________]


          


          By:
            ____________________________

          Paul
            Durando

          Vice
            President/Finance


          


          Mellon
            Bank, N.A.

          Mellon
            Financial Services Corporation #1


          


          By:
            ___________________________

          Name:

          Title:


          


          Citibank,
            N.A., as Administrative Agent


          


          By:
            ___________________________

          Stuart
            N.
            Berman

          Vice
            President

          


           

          
            
              
              

            

            
              
              

              
                

              

            

            
              
              

              
              

            

          



          EXHIBIT
            A

          


          Citibank,
            N.A.


          


          NOTICE
            OF
            EXCLUSIVE CONTROL


          


          _______________,
            ____

          


          Mellon
            Bank, N.A.

          __________________________

          __________________________

          __________________________

          Attention:
            __________________

          


          


          
            	 	
                    Re:

                  	
                    CONTROL
                      AGREEMENT (BANK ACCOUNTS) dated as of November ___, 2005 (the
“Agreement”)
                      among [___________________], Citibank, N.A., as Administrative
                      Agent and
                      Mellon Bank, N.A. relating to Account(s) No.
                      [_____________________]

                  


          

          


          Ladies
            and Gentlemen:

          


          This
            constitutes the Notice of Exclusive Control referred to in paragraph
            2 of the
            Agreement. In accordance with paragraph 2 of the Agreement we hereby
            inform you
            that the Exclusive Control Effective Date has occurred upon your receipt
            hereof.

          


          Citibank,
            N.A.


          


          By:
            ___________________________

          Stuart
            N.
            Berman

          Vice
            President

           

          
             

            
              
              

              
                

              

            

            
              
              

              
              

            

          



          EXHIBIT
            B

          


          Citibank,
            N.A.


          


          NOTICE
            OF
            TERMINATION OF EXCLUSIVE CONTROL


          


          _______________,
            ____

          


          Mellon
            Bank, N.A.

          __________________________

          __________________________

          __________________________

          Attention:
            __________________

          


          


          
            	 	
                    Re:

                  	
                    CONTROL
                      AGREEMENT (BANK ACCOUNTS) dated as of November ___, 2005 (the
“Agreement”)
                      among [____________________], Citibank, N.A., as Administrative
                      Agent and
                      Mellon Bank, N.A. relating to Account(s) No.
                      [____________________]

                  


          

          


          Ladies
            and Gentlemen:

          


          This
            constitutes the Notice of Termination of Exclusive Control referred to
            in
            paragraph 2 of the Agreement. In accordance with paragraph 2 of the Agreement
            we
            hereby inform you that the Exclusive Control Termination Date has occurred
            upon
            your receipt hereof.

          


          Citibank,
            N.A.


          


          By:
            ___________________________

          Stuart
            N.
            Berman

          Vice
            President


          
            
              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

        

      

    


    EXHIBIT
      E

    


    BLOCKED
      ACCOUNT AGREEMENT

    


    BLOCKED
      ACCOUNT AGREEMENT
      (the
AAgreement@)
      dated
      as of the __ day of __________, 2005, made by [____________________], a
      [_______________] corporation (the AGrantor@),
      to
      Citibank, N.A., as administrative agent (the AAdministrative
      Agent@)
      for the
      lenders (the ALenders@)
      parties
      to the Credit Agreement (as hereinafter defined). 

    


    RECITALS

    


    A. The
      Grantor entered into a certain Amended and Restated Credit Agreement dated
      as of
      September 30, 2004, as amended by a First Amendment dated as of February 28,
      2005 and by a Second Amendment of even date herewith (collectively, the
ACredit
      Agreement@).
      

    


    B. Pursuant
      to the Credit Agreement, the Grantor will receive Revolving Credit Loans and
      other financial accommodations from the Lenders named therein.

    


    C. In
      connection therewith, the Grantor has granted to the Administrative Agent a
      security interest in certain property, including, without limitation, all of
      the
      Grantor's present and future accounts receivable, contract rights and other
      forms of obligations for the payment of money (collectively, the "Accounts"),
      all as more fully described in the Amended and Restated Security Agreement
      dated
      as of the date hereof (as the same may be amended, supplemented or otherwise
      modified from time to time, the "Security Agreement"), executed by the Grantor
      in favor of the Administrative Agent. 

    


    D. The
      Grantor has further agreed pursuant to the terms of the Credit Agreement that
      after the Administrative Agent gives a notice in accordance with Section 5.12
      of
      the Credit Agreement, all checks, cash and other payments received by the
      Grantor with respect to the Accounts will be deposited by the Grantor in a
      blocked account. For the foregoing purpose, the Grantor has established with
      the
      Administrative Agent Account No. _____________________ (the "Blocked Account"),
      which Blocked Account will be governed by this Agreement.

    


    In
      consideration of the foregoing, the Grantor and the Administrative Agent hereby
      agree as follows:

    


    1. Capitalized
      terms used herein and not otherwise defined herein shall have the meanings
      ascribed to such terms in the Credit Agreement.

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    2. As
      part
      of the consideration for the indebtedness evidenced by the Revolving Credit
      Note, the Grantor does hereby absolutely and unconditionally grant a security
      interest to the Administrative Agent in and to the Blocked Account in all funds,
      whether or not proceeds of Collateral, now or hereafter on deposit in the
      Blocked Account and all of the Grantor's present and future rights in and to
      the
      Blocked Account and the funds on deposit therein. This grant of a security
      interest shall be in addition to the rights of the Administrative Agent in
      the
      funds on deposit in the Blocked Account as proceeds of its Collateral. Prior
      to
      the Full Dominion Effective Date, as hereinafter defined, Grantor shall be
      entitled to transfer, withdraw or otherwise disburse funds from the Blocked
      Account. Effective on and after the Full Dominion Effective Date, Grantor shall
      be deemed irrevocably to have waived Grantor=s
      authority to transfer, withdraw or otherwise disburse funds from the Blocked
      Account, and acknowledges that until such time as a Full Dominion Termination
      Date, as hereinafter defined, has occurred, Administrative Agent shall have
      exclusive control of, and full dominion over, funds credited to the Blocked
      Account. Grantor agrees promptly to pay directly and immediately to
      Administrative Agent any and all funds that Grantor transfers, withdraws or
      otherwise disburses from the Blocked Account in contravention of this Agreement.
      ?Full
      Dominion Effective Date@
      means
      the date of the giving of the notice specified in Section 5.12 (a) of the Credit
      Agreement in the form of Exhibit A hereto. Such notice shall be in effect until
      the Administrative Agent has delivered written Notice of the Grantor=s
      satisfaction of the release provisions contained in Section 5.12(d) of the
      Credit Agreement in the Form of Exhibit B hereto, and the date of such notice
      shall be referred to as the AFull
      Dominion Termination Date@.
      On and
      after the Full Dominion Termination Date, the Grantor shall again be entitled
      to
      transfer, withdraw or otherwise disburse funds from the Blocked
      Account.

    


    3. On
      and
      after the Full Dominion Effective Date and prior to any Full Dominion
      Termination Date, authorized agents of the Administrative Agent shall be the
      only Persons authorized to make withdrawals from, to draw upon, to issue wire
      transfer instructions, to transfer funds out of, and to otherwise exercise
      any
      authority over, the Blocked Account and the funds on deposit therein. No
      officer, agent, employee, designee or representative of the Grantor shall have
      any authority to withdraw any amounts from, to draw upon, to issue wire transfer
      instructions, to transfer funds out of, or to otherwise exercise any authority
      over the Blocked Account or the funds on deposit therein.

    


    4. On
      and
      after the Full Dominion Effective Date and prior to any Full Dominion
      Termination Date, the Administrative Agent has the right, and the Grantor hereby
      irrevocably authorizes the Administrative Agent, to withdraw funds from and/or
      draw upon the Blocked Account to pay amounts due and owing to the Administrative
      Agent under the Credit Agreement, including, without limitation, fees payable
      under the Credit Agreement, interest on and principal of Revolving Credit Loans
      thereunder and commitment fees payable thereunder all as more particularly
      provided below. The Grantor hereby agrees that all amounts deposited into the
      Blocked Account shall, two (2) Business Days after receipt thereof, be withdrawn
      by the Administrative Agent and shall be applied by the Administrative Agent
      to
      satisfy such outstanding Obligations, as defined in the Security Agreement,
      or
      held by the Administrative Agent as cash collateral for the Obligations, as
      provided in paragraph 2 hereof and in the Security Agreement, as more fully
      provided below:

    


    (a) Prior
      to
      the occurrence and continuance of an Event of Default occurring and continuing
      under the Credit Agreement, after the payment of any and all accrued expenses
      under Section 10.4 of the Credit Agreement due and unpaid thereunder, the
      Administrative Agent shall apply funds in the Blocked Account in the following
      order:

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	 	
              (i)

            	
              to
                accrued interest due and unpaid on the Revolving Credit
                Loans;

            


    

    


    
      	 	
              (ii)

            	
              to
                accrued commitment fees pursuant to Section 2.9 (a) of the Credit
                Agreement;

            


    

    


    
      	 	
              (iii)

            	
              to
                letter of credit fees due and unpaid pursuant to Section 2.9 (b)
                of the
                Credit Agreement;

            


    

    


    
      	 	
              (iv)

            	
              to
                the Administration Agent any annual fees due and unpaid pursuant
                to
                Section 2.9 (c) of the Credit
                Agreement;

            


    

    


    
      	 	
              (v)

            	
              to
                reduce the principal amount of the Revolving Credit Loans to an amount
                which considering any advances and/or repayments of same since the
                date of
                the last Borrowing Base Certificate will result in the Grantor being
                in
                compliance with Section 6.3 of the Credit Agreement;
                and

            


    

    


    
      	 	
              (vi)

            	
              to
                the extent of any excess remaining after application pursuant to
                (i)
                through (v) above, to the order of the
                Grantor.

            


    

    


    (b) After
      the
      occurrence and continuance of an Event of Default under the Credit Agreement,
      the Administrative Agent shall apply the balance from time to time in the
      Blocked Account to reduce the Obligations (as defined in the Security Agreement)
      at the Administrative Agent's sole discretion, and any balance remaining after
      such application shall be held as security for such Obligations as provided
      in
      paragraph 2 hereof and in the Security Agreement.

    


    5. On
      and
      after the Full Dominion Effective Date and prior to any Full Dominion
      Termination Date, the Grantor hereby agrees, on forms approved by the
      Administrative Agent, to instruct all Account Debtors to make all payments
      in
      respect of Accounts directly to the Blocked Account. The Blocked Account shall
      be non-interest bearing and shall be subject to debit or withdrawal only in
      accordance with the terms hereof. 

    


    6. The
      Blocked Account and the funds on deposit therein shall be subject to the
      Administrative Agent's right of setoff, banker's lien and any other rights
      the
      Administrative Agent has in and to deposit accounts maintained thereat. Nothing
      contained herein shall be deemed to be a waiver of any rights or remedies the
      Administrative Agent may have against the Grantor or any funds of the Grantor
      on
      deposit at the Administrative Agent. No failure of the Administrative Agent
      to
      require, and no delay by the Administrative Agent in requiring, the Grantor
      to
      comply with any requirement of this Agreement shall constitute a waiver of
      compliance with any requirement of this Agreement. No failure of the
      Administrative Agent to exercise, and no delay by the Administrative Agent
      in
      exercising, any right or any remedy, whether under this Agreement, at law or
      otherwise shall constitute a waiver of any such right or remedy. Any waiver
      by
      the Administrative Agent of compliance with a requirement of this Agreement,
      or
      of any right or any remedy, shall be effective only if in a writing signed
      by
      the Administrative Agent, and shall be limited to the specific instance for
      which such waiver was granted and shall not constitute a waiver of such
      compliance, right or remedy in the future or of compliance with any other
      requirement, or of any other right or remedy, whether under this Agreement
      or
      otherwise.

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    7. This
      Agreement may not be amended, modified, terminated or waived except in a writing
      signed by the party to be charged therewith; provided,
      that
      the Administrative Agent may terminate this Agreement upon thirty (30) days'
      written notice to the Grantor; and provided further,
      that
      after the termination of the Credit Agreement and the indefeasible payment
      in
      full to the Administrative Agent of all amounts owing thereunder or in respect
      thereof, either the Grantor or the Administrative Agent may terminate this
      Agreement upon one day's written notice to the other.

    


    8. Notices
      and other communications to be given hereunder shall be in writing and may
      be
      given (i) by certified or registered mail, return receipt requested, postage
      prepaid and shall be effective three (3) business days after deposit in the
      U.S.
      mail, (ii) by reliable same day or overnight courier and shall be effective
      one
      (1) business day after delivery to such courier or (iii) by telecopy and shall
      be effective when received; provided
      that all
      such notices and communications given hereunder to the Administrative Agent
      by
      any of the above described methods shall be effective only upon actual receipt
      by the Administrative Agent. Notices shall be addressed to the Grantor, at
      its
      address at 70 Maxess Road, Melville, New York 11747, and to the Administrative
      Agent, at its address specified in the Credit Agreement, or, as to either party,
      at such other address as shall be designated by such party in a written notice
      to the other party.

    


    9. This
      Agreement shall be binding upon and inure to the benefit of the Administrative
      Agent and the Grantor and their respective successors and assigns; provided
      that
      the Grantor may not assign any of its rights or obligations hereunder without
      the prior written consent of the Administrative Agent.

    


    10. In
      case
      any one or more of the provisions contained in this Agreement should be invalid,
      illegal or unenforceable in any respect in any jurisdiction, the validity,
      legality and enforceability of such provisions shall not be affected or impaired
      in any other jurisdiction, nor shall the remaining provisions contained herein
      and therein in any way be affected or impaired thereby.

    


    11. This
      Agreement may be executed in one or more counterparts, each of which shall
      constitute an original and all of which, taken together, shall constitute one
      and the same document.

    


    12. This
      Agreement will be governed by and construed in accordance with the laws of
      the
      State of New York without reference to principles of conflict of
      laws.

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

        
        

      

    



    IN
      WITNESS WHEREOF,
      the
      undersigned have hereunto executed this Blocked Account Agreement by their
      duly
      authorized officers as of the day and year first above written.

    


    CITIBANK,
      N.A., as Administrative Agent

    


    


    By:___________________________

    Stuart
      N.
      Berman

    Vice
      President

    


    [_____________________________]

    


    


    By:___________________________

    Paul
      Durando

    Vice
      President/Finance

    


    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

        
        

      

    



    EXHIBIT
      A

    


    NOTICE
      OF FULL DOMINION

    


    [Letterhead
      of Administrative Agent]

    


    
      	
              To:

            	
              [_____________________]

            


    

    


    
      	 	
              RE:

            	
              Account
                Number: _______________

            


    

    


    Dear
      Sir
      or Madam:

    


    Reference
      is made to the Blocked Account Agreement dated October __, 2005 (the
AAgreement@)
      between
      Citibank N.A., individually and as Administrative Agent for various lenders
      and
      you regarding the above captioned account (the AAccount@).
      Capitalized terms used herein without definition have the meaning given or
      incorporated by reference in the Agreement.

    


    In
      accordance with Section 2 of the Agreement, we hereby inform you that the Full
      Dominion Effective Date has occurred as of the date hereof.

    


    Sincerely,

    


    Citibank,
      N.A., as Administrative Agent

    


    


    By:_________________________

    Stuart
      N.
      Berman

    Vice
      President

    


    



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

        
        

      

    



    EXHIBIT
      B

    


    NOTICE
      OF TERMINATION OF FULL DOMINION

    


    [Letterhead
      of Administrative Agent]

    


    
      	
              To:

            	
              [____________________]

            


    

    


    
      	 	
              RE:

            	
              Account
                Number: _______________

            


    

    


    Dear
      Sir
      or Madam:

    


    Reference
      is made to the Blocked Account Agreement dated November __, 2005 (the
AAgreement@)
      between
      Citibank N.A., individually and as Administrative Agent for various lenders
      and
      you regarding the above captioned account (the AAccount@).
      Capitalized terms used herein without definition have the meaning given or
      incorporated by reference in the Agreement.

    


    In
      accordance with Section 2 of the Agreement, we hereby inform you that the Full
      Dominion Termination Date has occurred as of the date hereof.

    


    Sincerely,

    


    Citibank,
      N.A., as Administrative Agent

    


    


    By:_________________________

    Stuart
      N.
      Berman

    Vice
      President