Document:

No._________  
 	
            Name of Offeree  __________________
 

 

CONFIDENTIAL PRIVATE PLACEMENT MEMORANDUM

__________________________________

 

ETWINE, INC.

__________________________________

 

Maximum of 1,000,000 Shares of Common Stock

Offering Price: $0.25 per Share

__________________________________

 

eTwine, Inc., also known as “eTwine”, “we” or “us,” is offering for sale to persons who qualify as accredited investors and to a limited number of sophisticated investors, on a best efforts basis 1,000,000 shares of our common stock aggregating $250,000.00 at $0.25 per share. Subscriptions are payable by wire transfer or by check subject to collection. The offering price is $0.25 per common share. The common shares will be offered through our officers and directors on a best-efforts basis as set forth above. The minimum investment is $250, however, we may, in our sole discretion, accept subscriptions for lesser amounts. Therefore, funds received from all subscribers will be released to us upon acceptance of the subscriptions by us.

__________________________________

 

The securities offered hereby are speculative, involve a high degree of risk and should not be purchased by anyone who cannot afford the loss of their entire investment. Prospective investors should consider carefully the information set forth under “risk factors” before purchasing such securities. 

 

This memorandum contains forward-looking statements that involve risks and uncertainties. Our actual results may differ significantly from the results discussed in such forward-looking statements. Factors that might cause differences include, but are not limited to, those discussed in “risk factors.”

 

	
             
 	
            Price to Investors
 	
            Commission (1)
 	
            Proceeds to Company (2)
 
	
            Per Share
 	
            $0.25
 	
            $0
 	
            $0.25
 
	
            Maximum Offering – 1,000,000 Shares
 	
            $250,000
 	
            $0
 	
            $250,000
 

 

	
            (1)
 	
            The common shares are being offered on our behalf by our directors and officers who will not be compensated for doing so. 
 
	
            (2)
 	
            Before deducting non-commission expenses payable by us in connection with this offering, including, but not limited to blue sky filing fees, legal fees, and other related expenses of the offering estimated to be approximately $10,000.
 
	
            (3)
 	
            This offering will expire on the earlier to occur of (i) October 31, 2005; or (ii) the sale of all of the common shares, unless extended by us for up to an additional 60 day period, in our sole discretion. The expiration shall be known as the termination date. 
 

 

________________________

 

eTwine, Inc.

366 North Broadway, Suite 410

Jericho, NY 11753

 

JULY 25, 2005

 

 

1

 

 

 

The recipient of this document, prior to delivery, has agreed, and recipient’s acceptance constitutes recipient’s further agreement, that recipient will hold the information enclosed in this document and the transactions described in this document confidential and will not release or reproduce this document or discuss the information contained in it or use this document for any purpose other than evaluating a potential investment in our securities, without our prior express written permission.

 

Our common stock has not been registered under the Securities Act of 1933, as amended, also known as the “Securities Act,” or the securities laws of any state and are offered and sold in reliance upon exemptions from the registration requirements of the Securities Act and such state securities laws. The common stock has not been approved or disapproved by the Securities and Exchange Commission, any state securities commission or other regulatory authority, nor have any of the foregoing authorities passed upon or endorsed the merits of this offering or the accuracy or adequacy of the information set forth in this memorandum. Any representation to the contrary is unlawful. The common stock may not be sold or transferred without compliance with the registration or qualification provisions of applicable federal and state securities laws or an opinion of counsel, satisfactory to us, that an exemption from
such registration or qualification requirements is available. 

 

The minimum subscription is for $250, although we reserve the right to accept subscriptions for less than $250. The subscription price is payable upon submission to us of a fully completed and executed Subscription Agreement and Confidential Prospective Purchaser Questionnaire. The offering period will terminate upon the earlier to occur of (i) the date the maximum offering is sold or (ii) October 31, 2005; provided, however, that such offering period may be extended for up to an additional 60 day period in our sole discretion without notice to any subscriber. 

 

To The Prospective Purchasers

 

This memorandum should not be considered legal or investment advice and each investor should consult with his own counsel, accountant or other investment advisor with respect to the consequences of an investment. No person is authorized to give any information or to make any representation in connection with this offering other than those contained in this memorandum. Information or representations not contained herein must not be relied upon as having been authorized by either us or any of our representatives or agents. 

 

This memorandum has been prepared solely for the benefit of prospective investors interested in the possible placement of the securities and constitutes an offer only to an offeree to whom we have delivered this memorandum, and only to such offeree. Any reproduction or distribution of this memorandum, in whole or in part, or the disclosure of any of its contents, is prohibited without our prior written consent. Each offeree, by accepting delivery of this memorandum, agrees to return it and all related exhibits and other documents to us if the offeree does not intend to subscribe for the securities, the offeree’s subscription is not accepted, or the offering is terminated. 

 

The securities are not transferable without the satisfaction of certain conditions, including registration or the availability of an exemption under the securities act and state securities laws. Prospective investors should assume that they will have to bear the economic risk of an investment in the securities for an indefinite period of time. No one should invest in the securities who cannot afford to lose his entire investment. 

 

 

 

 

2

 

 

 

Each prospective investor and his advisor may, during normal business hours, ask us questions with respect to terms and conditions of the offering and request additional information relating to this memorandum. We will seek to provide answers and such information to the extent possessed by us or obtainable without unreasonable effort or expense. Offerees may be required to execute non-disclosure agreements as a prerequisite to reviewing documents determined by us to contain proprietary, confidential or otherwise sensitive information.

 

The statements contained in this document are based on information provided by us and believed to be reliable. Neither the delivery of this memorandum nor any sales made shall, under any circumstances, create an implication that there has been no change in the matters discussed herein since the date of this memorandum. However, in the event of any material changes during the offering period, this memorandum will be amended or supplemented accordingly. This memorandum contains a summary of certain provisions of documents relating to us, as well as summaries of various provisions of relevant statutes and regulations. Such summaries do not purport to be complete and are qualified in their entirety by reference to the texts of the original documents, statutes and regulations.

 

These securities are being offered in reliance upon an exemption from registration under the Securities Act, which exemption depends upon the existence of certain facts, including but not limited to the requirements that the securities are not being offered through general advertising or general solicitation, advertisements or communications in newspapers, magazines or other media, or broadcasts on radio or television, and that this memorandum shall be treated as confidential by the persons to whom it is delivered. Any distribution of this memorandum or any part of it or divulgence of any of its contents shall be unauthorized. 

 

This memorandum constitutes an offer only if a name appears on the appropriate space on the front cover. We have the right to reject subscriptions in whole or in part. 

 

This memorandum does not constitute an offer or solicitation in any state or other jurisdiction in which the person making such offer or solicitation is not qualified to do so or to any person to whom it is unlawful to make such offer or other solicitation. 

 

NASAA Uniform Legend

 

In making an investment decision investors must rely on their own examination of us and the terms of the offering, including the merits and risks involved. These securities have not been recommended by any federal or state securities commission or regulatory authority. Furthermore, the foregoing authorities have not confirmed the accuracy or determined the adequacy of this document. Any representation to the contrary is a criminal offense. These securities are subject to restrictions on transferability and resale and may not be transferred or resold except as permitted under the Securities Act, and the applicable state securities laws, pursuant to registration or exemption. Investors should be aware that they will be required to bear the financial risks of this investment for an indefinite period of time. 

 

 

 

3

 

 

 

TABLE OF CONTENTS

 

 

	
            HEADING
 	
            PAGE
 
	
             
 	
             
 
	
            SUMMARY
 	
            1
 
	
            THE OFFERING 
 	
            2
 
	
            RISK FACTORS 
 	
            4
 
	
            FORWARD LOOKING STATEMENTS AND ASSOCIATED RISKS
 	
            5
 
	
            USE OF PROCEEDS
 	
            6
 
	
            DIVIDENDS
 	
            6
 
	
            BUSINESS 
 	
            7
 
	
            MANAGEMENT 
 	
            8
 
	
            PRINCIPAL SHAREHOLDERS 
 	
            10
 
	
            CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS 
 	
            10
 
	
            PLAN OF DISTRIBUTION 
 	
            10
 
	
            DESCRIPTION OF SECURITIES
 	
            11
 
	
            LIMITATIONS ON TRANSFER OF SHARES
 	
            11
 
	
            INVESTOR QUALIFICATIONS
 	
            11
 
	
            SUBSCRIPTION PROCEDURES
 	
            15
 
	
            FURTHER INFORMATION
 	
            15
 

 

 

We encourage all potential investors to review carefully the attached exhibits and this memorandum.

 

 

 

 

4

 

 

 

SUMMARY

 

This memorandum contains forward-looking statements that involve risks and uncertainties. Our actual results may differ significantly from the results discussed in such forward-looking statements. Factors that might cause differences include, but are not limited to, those discussed in “Risk Factors.” 

 

eTwine, Inc.

 

eTwine, Inc. was formed in the State of New York on May 7, 2004. The Certificate of Incorporation was amended on August 17, 2004 to increase the authorized number of common shares to 50,000,000 at a par value of $.001 per share. The Company’s founder, Darrell Lerner, owns 300,000 shares. On July 1, 2005 we issued 7,000,000 shares to our new President and Chief Executive Officer, Clifford Lerner. 

 

eTwine Inc’s primary asset is its website which can be found at http://www.etwine.com. Our website was launched in beta mode in May 2004 and now has in excess of 5,500 members. 

 

eTwine.com is a unique social community website that is proactive in understanding the wants and needs of the modern day single while being innovative in both appealing to the non-single user and addressing the shortcomings of the products currently offered on the market. 

 

eTwine.com offers four distinct applications:

 

	
            •
 	
            Online Dating
 	
             

	
            •
 	
            Social Networking
 	
             

	
            •
 	
            Event Planning & Management.
 
	
            •
 	
            Weblogs (“Blogs”)
 	
             

					

 

eTwine integrates all four of these applications into one easy to use platform to create a superior product offering - while additionally presenting several unique features within each application. 

 

We presently maintain our principal offices at 366 North Broadway, Suite 410, Jericho, NY, 11753. Our telephone number is (516) 942-2030.

 

 

 

 

5

 

 

 

THE OFFERING

 

	
            Securities Offered.
 	
            We are offering a maximum of 1,000,000 common shares.
 
	
             
 	
             
 
	
            Purchase Price.
 	
            $0.25 per Share.
 
	
             
 	
             
 
	
             
 	
             
 
	
            Minimum Investment . 
 	
            $250, although we may, in our sole discretion, permit sales of less than $250.
 
	
             
 	
             
 
	
             
 	
             
 
	
            Offering Period
 	
            The offering period will terminate on the earlier of the sale of the maximum of 1,000,000 common shares or October 31, 2005. We have the option to extend the offering for a maximum of 60 days.
 
	
             
 	
             
 
	
            Plan of Distribution.
 	
            We, through our officers and directors, will offer on a best-efforts basis a maximum of 1,000,000 common shares.
 
	
             
 	
             
 
	
             
 	
             
 
	
            Investor Suitability
 	
            This offering will only be made to persons who qualify as “accredited investors,” as that term is defined under the Securities Act and a limited number of sophisticated investors who meet certain suitability standards described in this document.
 
	
             
 	
             
 
	
            Use of Proceeds 
 	
            The net proceeds from the offering will be used by us for advertising, working capital, and site enhancements thereby giving us the opportunity to gain members at a faster rate, further differentiate and brand our product, and ultimately generate revenue through membership fees and advertising income.
 
	
             
 	
             
 
	
            Restriction on Resale. 
 	
            None of the common shares offered will be registered under the Securities Act and the certificates representing our common shares will contain a legend restricting the distribution, resale, transfer, pledge, hypothecation or other disposition of the common shares unless and until such common shares are registered under the Securities Act or an opinion of counsel reasonably satisfactory to us is received that registration is not required under the Securities Act.
 
	
             
 	
             
 
	
            Available Documents 
 	
            Any documents or information concerning us which a prospective purchaser reasonably requests to inspect or have disclosed to him or her will be made available or disclosed, subject in appropriate circumstances to receipt by us of reasonable assurances that such documents or information will be maintained in confidence.
 
	
             
 	
             
 
	
            Subscription Documents 
 	
            The purchase of the common shares shall be made pursuant to the Confidential Prospective Purchaser Questionnaire (attached hereto as Exhibit B) and the Subscription Agreement (attached hereto as Exhibit C), which will contain, among other things, customary representations and warranties and investment representations by the purchasers.
 
	
             
 	
             
 
	
             
 	
             
 
	
            Expenses 
 	
            All prospective purchasers of the common shares will be responsible for their own costs, fees and expenses, including the costs, fees and expenses of their legal counsel and other advisors.
 
	
             
 	
             
 
	
            Dividends.
 	
            We have not paid any dividends to date on the common shares.
 

 

 

6

 

 

 

 

 

RISK FACTORS

 

The common shares offered are highly speculative in nature, involve a high degree of risk and should be purchased only by persons who can afford to lose their entire investment. Accordingly, prospective investors should carefully consider, along with other matters referred to herein, the following risk factors in evaluating our business before purchasing any common shares. This Memorandum contains forward-looking statements which involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including those set forth in the following risk factors and elsewhere in this Memorandum. 

 

We Have A Limited Operating History In Which To Evaluate Our Business.

 

We were incorporated in New York in May, 2004. We have limited revenue to date and have a limited operating history upon which an evaluation of our future success or failure can be made. 

 

If We Do Not Raise Enough Money, We Will Have To Delay Our Expansion Plans Or Go Out Of Business.

 

After the total amount of shares, equaling 1,000,000 or $250,000 are sold, there will be no refunds on the sale of our common shares. Even if we raise the maximum amount of this offering, we may not have enough funds to successfully undertake our business plan. 

 

There Is No Public Trading Market For Our Common Stock And You May Not Be Able To Resell Your Common Stock.

 

There is currently no public trading market for our common stock. Therefore, there is no central place, such as a stock exchange or electronic trading system, to resell your common shares. If you do want to resell your common shares, you may have to locate a buyer and negotiate your own sale.

 

Our Future Success Is Dependent, In Part, On the Performance And Continued Service Of Our Managers and Officers.

 

We are presently dependent to a great extent upon the experience, abilities and continued services of our managers and officers. The loss of services of any of the management staff could have a material adverse effect on our business, financial condition or results of operation.

 

The Shares Sold In This Offering Have Not Been Registered Under The Securities Act, And Therefore The Shareholders Must Be Prepared To Hold Such Shares For An Indefinite Period Of Time.

 

Our common shares offered are “restricted securities” as defined under the Securities Act. The resale of such securities may not be made without registration under the Securities Act and state securities laws or the existence of an exemption from such registration requirements.

 

We Have No Plans To Pay Dividends.

 

To date, we have paid no cash dividends on our common shares. For the foreseeable future, earnings generated from our operations will be retained for use in our business and not to pay dividends.

 

 

7

 

 

 

FORWARD LOOKING STATEMENTS AND ASSOCIATED RISKS

 

This memorandum contains certain forward-looking statements, including among others (i) anticipated trends in our financial condition and results of operations, and (ii) our business strategy for managing and expanding our operations. These forward-looking statements are based largely on our current expectations and are subject to a number of risks and uncertainties. Actual results could differ materially from these forward-looking statements. In addition to other risks described elsewhere in the Risk Factors discussion, important factors to consider in evaluating such forward-looking statements include (i) changes in external competitive market factors or in our internal budgeting process which might impact trends in our results of operations; (ii) unanticipated working capital or other cash requirements; (iii) changes in our business strategy or an inability to execute our strategy due to unanticipated
changes in the industries in which we operate; and (iv) various competitive factors that may prevent us from competing successfully in the marketplace. In light of these risks and uncertainties, many of which are described in greater detail elsewhere in the “Risk Factors” discussion, there can be no assurance that the events predicted in forward-looking statements contained in this memorandum will, in fact, transpire. Prospective investors should have this Disclosure Statement reviewed by their personal investment advisors, legal counsel and/or accountants to properly evaluate the risks and contingencies of this offering.  

 

USE OF PROCEEDS

 

The net proceeds to us after deducting offering expenses of up to $10,000.00 will be $240,000.00 if all of the common shares are sold. The first $10,000.00 raised will be used for offering expenses. We will use the net proceeds as

follows:

 

	
            Professional Services                  
 	
            $
 	
            40,000
 
	
            Advertising/Marketing             
 	
            $
 	
            120,000
 
	
            Website Development & Hosting
 	
            $
 	
            60,000
 
	
            Working Capital                                                 
 	
            $
 	
            20,000
 
	
                                                                                                                                                                                                            
 	
             
 	
             
 
	
            Total                  
 	
            $
 	
            240,000.00
 

 

While we currently intend to use the proceeds of this offering substantially in the manner set forth above, we reserve the right to reassess and reassign such use if, in the judgment of our board of directors, such changes are necessary or advisable. At present, no material changes are contemplated. Should there be any material changes in the above projected use of proceeds in connection with this offering, we will issue an amended prospectus reflecting the material change. The above amounts and priorities for the use of proceeds represent management’s estimates based upon current conditions.

 

DIVIDENDS

 

To date, we have paid no dividends on our common shares and have no present intention of paying any dividends on our common shares in the foreseeable future. The payment by us of dividends on the common shares in the future, if any, rests solely within the discretion of our board of directors and will depend upon, among other things, our earnings, capital requirements and financial condition, as well as other factors deemed relevant by our board of directors. Although dividends are not limited currently by any agreements, it is anticipated that future agreements, if any, with institutional lenders or others may limit our ability to pay dividends on our common shares.

 

 

8

 

 

 

BUSINESS

 

General

 

eTwine, Inc’s primary asset is its website which can be found at http://www.etwine.com. Our website was launched in beta mode in May 2004 and now has in excess of 5,500 members.

 

eTwine.com is a unique social community website that is proactive in understanding the wants and needs of the modern day single while being innovative in both appealing to the non-single user and addressing the shortcomings of the products currently offered on the market.

 

eTwine.com offers four distinct applications:

 

	
            •
 	
            Online Dating
 	
             

	
            •
 	
            Social Networking
 	
             

	
            •
 	
            Event Planning & Management.
 
	
            •
 	
            Weblogs (“Blogs”)
 	
             

					

 

eTwine integrates all four of these applications into one easy to use platform to create a superior product offering - while additionally presenting several unique features within each application.

 

eTwine believes that its product offering in each one of these components on its own would significantly enhance the user experience compared to what our competitors offer, however, eTwine has gone one step further by devising a strategy for the seamless integration of these platforms into one easy to use application. Ultimately, the synergies that result from this integration will allow eTwine to offer its members a truly unparalleled online social experience with enormous profit potential for our investors.

 

While eTwine has something for all users, its particular target is the singles market. eTwine intends to become the pioneer and leader in the newly emerging enhanced social networking arena. eTwine’s social community concept combines all aspects of social networking and online dating with a unique event planning & management application. The social community concept that we have created is fun and exciting for singles, and ultimately offers singles more and easier ways to meet a potential mate. In addition to all of the standard features of online dating & social networking, eTwine elevates the concept with unique social networking features including:

 

	
            •
 	
            Double Dating & Group Dating
 	
             

	
            •
 	
            The Exclusive “My Wingman” Concept
 	
             

	
            •
 	
            Singles Events with Unique Privacy Options
 	
             

	
            •
 	
            A Personal Blogging Tool in the User’s Profile
 
	
            •
 	
            Blog Ratings
 	
             

	
            •
 	
            Periodic Event Notification Emails for Singles
 	
             

	
            •
 	
            “Date Now!” for Busy Urban Professionals
 	
             

									

 

Revenue Streams:

 

eTwine anticipates generating revenue from four distinct revenue streams:

 

9

 

 

 

 

	
            •
 	
            Subscription Fees - Once a critical mass of users have joined the site, eTwine will employ a standard subscription based model whereby users pay a monthly subscription fee in order to access certain premium features on the site.
 

 

	
            •
 	
            eTwine Events - eTwine intends to offer a number of events for singles in various cities throughout the country. From speed dating to general bar nights, eTwine will host targeted events (based on age, race, religion, interests, etc) utilizing its member base. eTwine possesses a strong competitive advantage in this area by virtue of its event planning application because programming can be set up to ensure that eTwine sponsored events automatically filter into the target members’ community pages on the website as well as into their mailbox as the featured event in their periodic event notification emails.
 

 

	
            •
 	
            Listing Fees from Establishments - eTwine’s most unique revenue stream will result from charging establishments a monthly fee to list their events on eTwine.com. When eTwine users sign on to the site, they view events targeted to age range, location, and type of event. eTwine plans to charge bars, clubs, and organizations a monthly fee to list their events, which will filter directly into the in-boxes and accounts of their target markets.
 

 

	
            •
 	
            Advertising/Sponsorship - Once a reasonable number of users have joined the site, eTwine will employ a standard model in charging for advertising and sponsorships. The demographic that social networking and online dating sites typically attract is especially desirable to advertisers so this revenue stream has the potential to be substantial.
 

 

As of July 25, 2005, we have generated $101.07 in revenue via advertisements placed on eTwine.com.

 

Employees

 

As of July 25, 2005, we have 7 employees.

 

Legal Proceedings

 

In the normal course of our business, we may periodically become subject to various lawsuits. However, there are currently no legal actions pending against us nor, to our knowledge, are any such proceedings contemplated.

 

MANAGEMENT

 

Directors and Executive Officers

 

The following table sets forth, as of July 25, 2005, the names and ages of all of our directors and executive officers; and all positions and offices held. The director will hold such office until the next annual meeting of shareholders and until his or her successor has been elected and qualified.

 

	
            Name  
 	
            Age  
 	
            Position
 	
             

	
            Cliff Lerner  
 	
            27  
 	
            President, CEO, Chairman of Board of Directors
 
					

 

 

10

 

 

 

The board of directors has no standing committees.

 

Family Relationships

 

No family relationship has ever existed between any director, executive officer of the company, or any person contemplated to become such.

 

Business Experience

 

The following summarizes the occupation and business experience during the past five years for our sole officer and directors.

 

CLIFF LERNER is our President and Chief Executive Officer as well as Chairman of our Board of Directors. Cliff has spent his professional career prior to joining eTwine at Lehman Brothers as an Analyst in its Equities division. He received a BS in Applied Economics & Business Management from Cornell University and was accepted into the prestigious START training program at Lehman Brothers where he began his career in the Product Management Group. He was asked to take on various roles at Lehman due to his versatility. His analytical skills and creativity have played a significant role in evolving his group into the focal point of Lehman’s equities research division for information and analysis. These skills coupled with his keen knowledge and understanding of successful business models as well as the overall online dating and social networking industries make him an invaluable asset and natural leader for eTwine.

 

Employment Agreements/ Terms of Office

 

None of the members of the Board of Directors or members of the management team presently have employment agreements with us.

 

Director Compensation

 

Our directors will not receive a fee for attending each board of directors meeting or meeting of a committee of the board of directors. All directors will be reimbursed for their reasonable out-of-pocket expenses incurred in connection with attending board of director and committee meetings.

 

Option Plan

 

There is no stock option plan or common shares set aside for any stock option plan.

 

Certain Relationships and Related Transactions

 

We will present all possible transactions between us and our officers, directors or 5% stockholders, and our affiliates to the board of directors for our consideration and approval. Any such transaction will require approval by a majority of the disinterested directors and such transactions will be on terms no less favorable than those available to disinterested third parties.

 

11

 

 

 

PRINCIPAL SHAREHOLDERS

 

The following table sets forth certain information concerning stock ownership of all persons known by us to own beneficially five percent or more of the outstanding Common Stock, each director and certain executive officers and directors as a group, and as adjusted to reflect the sale of the total amount of Shares offered hereby.

 

	
            Name of Beneficial 

Owner                                                      
 	
            Number of

Common shares Owned
 	
            Percent of Class

Before Offering
 	
            Percent of Class

After Offering(1)
 
	
                                                                                                                                                            
 	
             
 	
             
 	
             
 
	
            Cliff Lerner                            
 	
            7,000,000
 	
            95.8%
 	
            84.3%
 
	
             
 	
             
 	
             
 	
             
 

 

	
            (1)
 	
            Assumes the sale of all of the Common shares offered.
 

 

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

 

Except as disclosed below, none of the following persons has any direct or indirect material interest in any transaction to which we are a party since our incorporation or in any proposed transaction to which we are proposed to be a party:

 

	
            (A)  
 	
            Any of our directors or officers;
 	
             

	
            (B)
 	
            Any proposed nominee for election as our director;
 

	
            (C)   
 	
            Any person who beneficially owns, directly or indirectly, shares carrying more than 10% of the voting rights attached to our Common Stock; or
 
	
            (D)   
 	
            Any relative or spouse of any of the foregoing persons, or any relative of such spouse, who has the same house as such person or who is a director or officer of any parent or subsidiary of our company.
 

 

 

PLAN OF DISTRIBUTION

 

Through our officers and directors, we are offering for sale, 1,000,000 common shares, at $0.25 per common share on a best-efforts basis. The Shares are being offered to accredited and a limited number of sophisticated investors by our officers and directors. Subscriptions are payable by wire transfer or by check subject to collection. The offering price is $0.25 per common share. The minimum investment is $250, however, we may, in our sole mutual discretion, accept subscriptions for lesser amounts. We shall be responsible for paying the legal fees and expenses incurred in connection with the registration of the common shares being sold in this offering under the state blue sky laws of the various states in which the common shares are sold, which fees are not expected to exceed $10,000.

 

We reserve the right to reject any subscription from a subscriber that we believe, in our sole discretion, does not meet the suitability standards for this offering. In such an event, any funds received from such subscriber will be promptly returned without interest or deduction.

 

Prior to the closing, a Confidential Prospective Purchaser Questionnaire (annexed hereto as Exhibit B) and a 

 

12

 

 

 

Subscription Agreement (annexed hereto as Exhibit C) must be completed and executed by each investor and delivered to us along with funds in the amount of the purchase price of the common shares being purchased.

 

We may, at our sole discretion, reject any potential investor’s Subscription Agreement in whole or in part, however, Subscription Agreements from any potential investor may only be accepted if such investor meets the minimum suitability standards for an investment in this offering. We are under no obligation to accept a potential investor’s Subscription Agreement and we have the discretion to accept Subscription Agreements to subscribe for any amount up to and including the amount of the entire offering. Our executive officers, controlling persons and affiliates may purchase our common shares in the offering in any amount.

 

DESCRIPTION OF SECURITIES

 

Common Stock

 

We are authorized to issue 50,000,000 shares of common stock, $.001 par value per share. As of the date of this Circular, 7,300,000 common shares were issued and outstanding. Each outstanding share of Common Stock is entitled to one vote, either in person or by proxy, on all matters that may be voted on by the owners thereof at meetings of eTwine’ shareholders. Upon the completion of this offering, 8,300,000 common shares will be issued and outstanding, assuming sale of all of the common shares.

 

All common shares that are offered, when issued, will be fully paid and non-assessable, with no personal liability attaching to the ownership. The holders of common shares do not have cumulative voting rights, which means that the holders of more than 50% of such outstanding common shares can elect all of the directors.

 

Dividend Policy

 

It is unlikely that we will declare or pay cash dividends in the foreseeable future. We intend to retain earnings, if any, to expand our operations.

 

LIMITATIONS ON TRANSFER OF SHARES

 

The shares offered hereby have not been registered with the Commission pursuant to the Securities Act; however, they are deemed to be exempt from such registration pursuant to Regulation D Rule 506 of the Securities Act. Even so, the shares are subject to a restriction on re-sale and will be marked as such on the face of the certificate. In addition, there are limits on the resale of the shares by virtue of their corporate issuance. Accordingly, an investment in the shares offered herein should be considered highly illiquid.

 

INVESTOR QUALIFICATIONS

 

Prospective investors should consider carefully each of the risks associated with this offering, particularly those described in “Risk Factors.” In view of these risks, including the lack of an available trading market for the securities, 

 

13

 

 

 

and the consequent long-term nature of any investment in us, this offering is available only to investors who have substantial net worth and no need for liquidity in their investments. The shares will be offered for sale only to accredited investors and a limited number of sophisticated investors, who, in conjunction with such sale, will represent in the Subscription Agreement that, among other things, the share(s) purchased are being acquired by each investor for his own account, for investment purposes and not with a view to resell or distribute those shares.

 

We, in reliance upon the criteria set forth in Rule 501(a) promulgated under the Securities Act, have established investor suitability standards for investors in the securities. Common shares will be sold only to an investor who:

 

(a) represents that such investor is acquiring the common shares for such investor’s own account, for investment only not with a view to the resale or distribution thereof;

 

(b) acknowledges that the right to transfer the common shares will be restricted by the Securities Act, applicable state securities laws and certain contractual restrictions, and that the investor’s ability to do so will be restricted by the absence of a market for the common shares; and

 

(c) represents that such investor qualifies as one or more of the following:

 

(1) Any natural person whose individual net worth, or joint net worth with that person’s spouse, at the time of his purchase exceeds $250,000;

 

(2) Any natural person who had an individual income in excess of $250,000 in each of the two most recent years, or (except for residents of the State of New Jersey) joint income with that person’s spouse in excess of $300,000 in each of those years, and has a reasonable expectation of reaching the same income level in the current year;

 

(3) Any bank as defined in Section 3(a)(2) of the Securities Act of 1933, as amended (the  “Act”), or any savings and loan association or other institution as defined in Section 3(a)(5)(A) of the Act whether acting in its individual or fiduciary capacity; any broker or dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934, as amended; any insurance company as defined in Section 2(13) of the Act; any investment company registered under the Investment Harrison Act of 1940 (the “Investment Company Act”) or a business development Harrison as defined in Section 2(a)(48) of the Investment Company Act; any Small Business Investment Company licensed by the U.S. Small Business Administration under Section 301(c) or (d) of the Small Business Investment Act of 1958; any plan established and maintained by a state, its political subdivisions, or any agency or
instrumentality of a state or its political subdivisions for the benefit of its employees, if such plan has total assets in excess of $5,000,000; any employee benefit plan within the meaning of the Employee Retirement Income Security Act of 1974 (“ERISA”), if the investment decision is made by a plan fiduciary, as defined in Section 3(21) of ERISA, which is either a bank, savings and loan association, insurance company, or registered investment adviser, or if the employee benefit plan has total assets in excess of $5,000,000 or, if a self-directed plan, with investment decisions made solely by persons that are accredited investors; 

 

 

14

 

 

 

(4) Any private business development company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940;

 

(5) Any organization (described in Section 501(c)(3) of the Internal Revenue Code), corporation, Massachusetts or similar business trust, or partnership, not formed for the specific purpose of acquiring the securities offered, with total assets in excess of $5,000,000;

 

	
            (6) Any director, or executive officer of eTwine;
 

 

(7) Any trust, with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the securities offered, whose purchase is directed by a person who has such knowledge and experience in financial and business matters that he is capable of evaluating the merits and risks of the prospective investment, or the company reasonably such purchaser comes within this description; or

 

	
            (8) Any entity in which all of the equity owners are accredited investors.
 

 

If such person is not an Accredited Investor, that such person must be a sophisticated investor who:

 

(a) represents that such investor is acquiring the Securities or such investor’s own account, for investment only not with  view to the resale or distribution thereof;

 

(b) acknowledges that the right to transfer the Securities will be restricted by the Securities Act, applicable statesecurities laws and certain contractual restrictions, and that he investor’s ability to do so will be restricted by the absence of a market for the Securities; and

 

	
            (c) represents that such investor qualifies as one or more of the following:
 

 

	
            (1)
 	
            has an investment of $250,000 or more in shares;
 

(2)              has personal  income before taxes for his or her last fiscal year or latest  12-month  period of at least $300,000;

(3)              is capable of bearing the economic risk of his or her investment and has a net worth (exclusive of home, home furnishings, personal automobiles and the amount to beinvested in these shares) of at least five (5) times the total purchase price of the shares subscribed for by the investor.

 

Investors will be required to make certain representations and to satisfy certain other standards and conditions, which are set forth in a Confidential Prospective Purchaser Questionnaire and Subscription Agreement (annexed hereto as Exhibits B and C, respectively) that must be executed by all investors in this offering.

 

The suitability standards referred to above are minimum requirements; the satisfaction of such standards does not mean that an investment in the Company is a suitable investment for an investor. In addition, we may revoke the offer made and refuse to sell any common shares to a prospective investor for any other reason whatsoever, even if such investor returns a Confidential Prospective Purchaser Questionnaire and Subscription Agreement containing appropriate representations.

 

 

 

 

 

15

 

 

 

SUBSCRIPTION PROCEDURES

 

In order to subscribe for the common shares, each prospective investor will be required to deliver the subscription price, made payable to “eTwine, Inc.” in United States dollars, by check or wire transfer in accordance with our instructions. In addition, the prospective investor must complete, execute and deliver the following to us:

 

	
            •
 	
            A signature page that will evidence such prospective investor’s execution of a Subscription Agreement. This document includes certain representations by such investor relating to such investor’s subscription; and
 

 

	
            •
 	
            A completed and executed Confidential Prospective Purchaser Questionnaire.
 

 

A prospective investor remitting the purchase price by wire transfer should first contact us to receive proper wire instructions to make necessary arrangements for such wire.

 

Subscription agreements are not binding on us until accepted by us. We reserve the right to reject, in whole or in part, in our sole discretion, any lesser number of common shares than the number for which a prospective investor has subscribed. If we reject all or a portion of any subscription, we will mail the subscriber a check for all, or the appropriate portion of, the amount submitted with such subscriber’s subscription, without interest or deduction there from.

 

FURTHER INFORMATION

 

The statements contained in this memorandum constitute only a brief summary of certain provisions of the documents referred to and the transactions contemplated. The statements contained in this document do not purport to be a complete description of every term and condition of such documents and are qualified in their entirety by reference to such documents. As with any summary, some details and exceptions have been omitted. If any of the statements made in this document are in conflict with any of the terms of any of such documents, the terms of such documents will govern. Reference is made to the actual documents for a complete understanding of what they contain. Copies of all documents in connection with the transaction described in this memorandum are either enclosed or are available for inspection at our offices. Each prospective investor and his advisor are invited and encouraged to ask us questions
with respect to the terms and conditions of the offering and our business and request additional information necessary to verify information in this memorandum. We will seek to provide answers and such information to the extent possessed or obtainable without unreasonable effort or expense. Offerees may be required to execute non-disclosure agreements as a prerequisite to reviewing documents determined by us to contain proprietary, confidential or otherwise sensitive information. To obtain such information or to make arrangements to ask such questions of us, prospective investors should contact us at (516) 942-2030.

 

 

 

 

 

 

 

16

 

 

 

SUBSCRIPTION AGREEMENT

 

To:  eTwine, Inc.

	
            Attn:  Mr. Cliff Lerner
 	
             

	
            366 North Broadway, Suite 410
 
	
            Jericho, NY 11753
 	
             

			

 

Gentlemen:

 

1. Subscription.

 

The undersigned (the “Purchaser”), intending to be legally bound, hereby irrevocably agrees to purchase from eTwine, Inc., a New York Corporation (the “Company”), the number of shares, set forth on the Signature Page at the end of this subscription Agreement (the  “Agreement”) at a purchase price of $0.25 per share with a minimum investment of $250, upon the terms and conditions hereinafter set forth. This subscription is submitted to the Company accordance with and subject to the terms and conditions described in this Agreement and in the Confidential Private Placement Memorandum dated as of July 25, 2005.

 

The undersigned is delivering (i) the subscription payment made payable to eTwine, Inc. (ii) two executed copies of the Signature page at the end of this Agreement, and (iii) one executed copy of Purchaser Questionnaire for Individuals (if appropriate), attached hereto as Exhibit II, to:

 

	
            eTwine, Inc.
 	
             

	
            Attn:  Mr. Cliff Lerner
 	
             

	
            366 North Broadway, Suite 410
 
	
            Jericho, NY 11753
 	
             

				

 

The undersigned understands that the Common Stock is being issued pursuant to the exemption from the registration requirements of the United States Securities Act of 1933, as amended (the “Securities Act”), provided by Regulation D Rule 506 of such Securities Act. As such, the Common Stock is only being offered and sold to investors who qualify as “accredited investors,” and a limited number of sophisticated investors and the Company is relying on the representations made by the undersigned in this Agreement that the undersigned qualifies as such an accredited or sophisticated investor. The shares of Common Stock are “restricted securities” for purposes of the United States securities laws and cannot be transferred except as permitted under these laws.

 

2. Acceptance of Subscription.

 

The Offering will be open until the earlier to occur of (i) October 31, 2005; or (ii) the sale of all of the common shares, unless extended by us for up to an additional 60 day period, in our sole discretion.

 

17

 

 

 

Subject to applicable state securities laws, the Purchaser may not revoke any subscription that such Purchaser delivers to the Company. However, the undersigned understands and agrees that the Company, in its sole discretion, may (i) reject the subscription of any Purchaser, whether or not qualified, in whole or in, part, and (ii) may withdraw the Offering at any time prior to the termination of the Offering. The Company shall have no obligation to accept subscriptions in the order received. This subscription shall become binding only if accepted by the Company.

 

3. Memorandum.

 

The Purchaser hereby acknowledges receipt of a copy of the Confidential Private Placement Memorandum dated July 25, 2005 (as, the “Memorandum”).

 

4. Representations and Warranties.

 

4.1. The Company represents and warrants to, and agrees with the undersigned as follows, in each case as of the date hereof and in all material respects as of the date of any closing, except for any changes resulting solely from the Offering:

 

(a) The Company is duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation with full power and authority to own, lease, license and use its properties and assets and to carry out the business in which it is engaged as described in the Memorandum. The Company is in good standing as a foreign corporation in every jurisdiction in which its ownership, leasing, licensing or use of property or assets or the conduct of its business makes such qualification necessary, except where the failure to be so qualified would not have a material adverse effect on the Company.

 

(b) At the date of the initial closing, the authorized capital stock of the Company will consist of 100,000,000 shares of common stock, par value $.001 per share. At such date, without taking into account the initial closing, there will be outstanding no more than 7,250,000 shares of Common Stock, excluding shares issued in connection with the Offering, shares issued upon exercise or conversion of options, warrants or other rights outstanding as of the date of the initial closing, in accordance with their terms as of such date, which terms have been described properly in the Memorandum.

 

Each outstanding share of Common Stock is validly authorized, validly issued, fully paid and non-assessable, without any personal liability attaching to the ownership thereof and has not been issued and is not or will not be owned or held in violation of any preemptive rights of stockholders. There is no commitment, plan or arrangement to issue, and no outstanding option, warrant or other right calling for the issuance of, any share of capital stock of the Company or any security or other instrument which by its terms is convertible into, exercisable for or exchangeable for capital stock of the Company, except, as may be described in the Memorandum. There is outstanding no security or other instrument which by its terms is convertible into or exchangeable for capital stock of the Company, except as may be described in the Memorandum

 

18

 

 

 

(c)There is no litigation, arbitration, claim, governmental or other proceeding (formal or informal), or investigation pending or, to the best knowledge of the officers of the Company, threatened with respect to the Company, or any of its subsidiaries, operations, businesses, properties or assets except as may be described in the Memorandum or such as individually or in the aggregate do not now have and could not reasonably be expected have a material adverse effect upon the operations, business, properties or assets of the Company.

 

(d) The Company is not in violation of, or in default with respect to, any law, rule, regulation, order, judgment or decree except as may be described in the Memorandum or such as in the aggregate do not now have and will not in the future have a material adverse effect upon the operations, business, properties or assets of the Company; nor is the Company required to take any action in order to avoid any such violation or default.

 

(e) The Company has all requisite power and authority (i) to execute, deliver and perform its obligations under this Agreement, and (ii) to issue and sell the shares in the Offering.

 

(f) No consent, authorization, approval, order, license, certificate or permit of or from, or declaration or filing with, any United States federal, state, local, or other applicable governmental authority, or any court or any other tribunal, is required by the Company for the execution, delivery or performance by the Company of this Agreement or the issuance and sale of the shares, except such filings and consents as may be required and have been or at the initial closing will have been made or obtained under the laws of the United States federal and state securities laws.

 

(g) The execution, delivery and performance of this Agreement and the issuance of the Shares will not violate or result in a breach of, or entitle any party (with or without the giving of notice or the passage of time or both) to terminate or call a default under any agreement or violate or result in a breach of any term of the Company's Articles of Incorporation or Bylaws of, or violate any law, rule, regulation, order, judgment or decree binding upon, the Company, or to which any of its operations, businesses, properties or assets are subject, the breach, termination or violation of which, or default under which, would have a material adverse effect on the operations, business, properties or assets of the Company.

 

19

 

 

 

(h) The Shares issuable in this Offering are validly authorized and, if and when issued in accordance with the terms and conditions set forth in the Memorandum and in this Agreement, will be validly issued, fully paid and non-assessable without any personal liability attaching to the ownership thereof, and will not be issued in violation of any preemptive or other rights of stockholders.

 

(i) The Memorandum and this Agreement do not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading. Without limiting the generality of the foregoing, there has been no material adverse change in the financial condition, results of operations, business, properties, assets, liabilities, or, to the knowledge of the Company, future prospects of the Company from the latest information set forth in the Memorandum.

 

4.2. The undersigned hereby represents and warrants to, and agrees with, the Company as follows:

 

(a) The undersigned is an "Accredited Investor" as that term is defined in Rule 501 (a) of Regulation D promulgated under the Securities Act, and as specifically indicated in Exhibit I attached to this Agreement. "

 

(b) The undersigned is a "Sophisticated Investor" as that term is defined in Rule 506(b)(2)(ii) of Regulation D promulgated under the Securities Act.

 

(c) For California and Massachusetts individuals: If the subscriber is a California resident, such subscriber's investment in the Company will not exceed 10% of such subscriber's net worth (or joint net worth with his spouse). If the subscriber is a Massachusetts resident, such subscriber's investment in the Company will not exceed 25% of such subscriber's joint net worth with such subscriber's spouse (exclusive of principal residence and its furnishings).

 

20

 

 

 

(d) If a natural person, the undersigned is: a bona fide resident of the state or non-United States jurisdiction contained in the address set forth on the Signature Page of this Agreement as the undersigned's home address; at least 21 years of age; and legally competent to execute this Agreement. If an entity, the undersigned has its principal offices or principal place of business in the state or non-United States jurisdiction contained in the address set forth on the Signature Page of this Agreement, the individual signing on behalf of the undersigned is duly authorized to execute this Agreement and this Agreement constitutes the legal, valid and binding obligation of the undersigned enforceable against the undersigned in accordance with its terms.

 

(e) The undersigned has received, read carefully and is familiar with this Agreement and the Memorandum.

 

(f) The undersigned is familiar with the Company's business, plans and financial condition, the terms of the Offering and any other matters relating to the Offering, the undersigned has received all materials which have been requested by the undersigned, has had a reasonable opportunity to ask questions of the Company and its representatives, and the Company has answered all inquiries that the undersigned or the undersigned's representatives have put to it. The undersigned has had access to all additional information necessary to verify the accuracy of the information set forth in this Agreement and the Memorandum and any other materials furnished herewith, and have taken all the steps necessary to evaluate the merits and risks of an investment as proposed hereunder.

 

(g) The undersigned (or the undersigned's purchaser representative) has such knowledge and experience in finance, securities, taxation, investments and other business matters so as to be able to protect the interests of the undersigned in connection with this transaction, and the undersigned's investment in the Company hereunder is not material when compared to the undersigned's total financial capacity.

 

(h) The undersigned understands the various risks of an investment in the Company as proposed herein and can afford to bear such risks, including, without limitation, the risks of losing the entire investment.

 

(i) The undersigned acknowledges that no market for the Common Stock presently exists and none may develop in the future and that the undersigned may find it impossible to liquidate the investment at a time when it may be desirable to do so, or at any other time.

 

21

 

 

 

(j) The undersigned has been advised by the Company that none of the Common Stock has been registered under the Securities Act, that the Common Stock will be issued on the basis of the statutory exemption provided by Rule 506 of the Securities Act or Regulation D promulgated thereunder, or both, relating to transactions by an issuer not involving any public offering and under similar exemptions under certain state securities laws; that this transaction has not been reviewed by, passed on or submitted to any federal or state agency or self-regulatory organization where an exemption is being relied upon; and that the Company's reliance thereon is based in part upon the representations made by the undersigned in this Agreement.

 

(k) The undersigned acknowledges that the undersigned has been informed by the Company of or is otherwise familiar with, the nature of the limitations imposed by the Securities Act and the rules and regulations thereunder on the transfer of the Common Stock. In particular, the undersigned agrees that no sale, assignment or transfer of any of the Common Stock shall be valid or effective, and the Company shall not be required to give any effect to such a sale, assignment or transfer, unless (i) the sale, assignment or transfer of such Common Stock is registered under the Securities Act, it being understood that the Common Stock are not currently registered for sale and that the Company has no obligation or intention to so register the Common Stock, except as contemplated by the terms of this Agreement or (ii) such Common Stock is sold, assigned or transferred in accordance with all the
requirements and limitations of Rule 144 under the Securities Act (it being understood that Rule 144 is not available at the present time for the sale of the Common Stock), or (iii) such sale, assignment or transfer is otherwise exempt from registration under the Securities Act, including Regulation S promulgated thereunder. The undersigned further understands that an opinion of counsel and other documents may be required to transfer the Common Stock.

 

(l) The undersigned acknowledges that the Common Stock shall be subject to a stop transfer order and the certificate or certificates evidencing any Common Stock shall bear the following or a substantially similar legend or such other legend as may appear on the forms of Common Stock and such other legends as may be required by state blue sky laws:

 

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933 (THE "ACT") OR. APPLICABLE STATE SECURITIES LAWS, AND SUCH SECURITIES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH SALE OR TRANSFER IS EXEMPT FROM SUCH REGISTRATION REQUIREMENTS OF THE ACT AND APPLICABLE STATE SECURITIES LAWS. 

 

22

 

 

 

(m) The undersigned will acquire the Common Stock for the undersigned's own account (or for the joint account of the undersigned and the undersigned's spouse either in joint tenancy, tenancy by `he entirety or tenancy in common) for investment and not with a view to the sale or distribution thereof or the granting of any participation therein, and has no present intention of distributing or selling to others any of such interest or granting any participation therein.

 

(n) No representation, guarantee or warranty has been made to the undersigned by any broker, the Company, any of the officers, directors, stockholders, partners, employees or agents of either of them, or any other persons, whether expressly or by implication, that:

 

(I) the Company or the undersigned will realize any given percentage of profits and/or amount or type of consideration, profit or loss as a result of the Company's activities or the undersigned's investment in the Company; or (II) the past performance or experience of the management of the Company, or of any other person, will in any way indicate the predictable results of the ownership of the Common Stock or of the Company's activities.

 

(o) No oral or written representations have been made other than as stated in the Memorandum, and no oral or written information furnished to the undersigned or the undersigned's advisor(s) in connection with the Offering were in any way inconsistent with the information stated in the Memorandum.

 

(p) The undersigned is not subscribing for the Common Stock as a result of or subsequent to any advertisement, article, notice or other communication published in any newspaper, magazine or similar media or broadcast over television or radio, or presented at any seminar or meeting, or any solicitation of a subscription by a person other than a representative of the Company with which the undersigned had a pre-existing relationship in connection with investments in securities generally.

 

(q) The undersigned is not relying on the Company with respect to the tax and other economic considerations of an investment.

 

23

 

 

 

(r) The undersigned understands that the net; proceeds from all subscriptions paid and accepted pursuant to the Offering (after deduction for commissions, discounts and expenses of the Offering) will be used in all material respects for the purposes set forth in the Memorandum.

 

(s) Without limiting any of the undersigned's other representations and warranties hereunder, the undersigned acknowledges that the undersigned has reviewed and is aware of the risk factors described in the Memorandum.

 

(t) The undersigned acknowledges that the representations, warranties and agreements made by the undersigned herein shall survive the execution and delivery of this Agreement and the purchase of the Common Stock.

 

(u) The undersigned has consulted his own financial, legal and tax advisors with respect to the economic, legal and tax consequences of an investment in the Common Stock and has not relied on the Memorandum or the Company, its officers, directors or professional advisors for advice as to such consequences.

 

	
            5.
 	
            Indemnification.
 

 

The Purchaser understands the meaning and legal consequences of the representations and warranties contained in Section 4.2, and agrees to indemnify and hold harmless the Company and each member, officer, employee, agent or representative thereof against any and all loss, damage or liability due to or arising out of a breach of any representation or warranty, or breach or failure to comply with any covenant, of the Purchaser, whether contained in the Memorandum or this Subscription Agreement. Notwithstanding any of the representations, warranties, acknowledgments or agreements made herein by the Purchaser, the Purchaser does not thereby or in any other manner waive any rights granted to the Purchaser under federal or state securities laws.

 

	
            6.
 	
            Provisions of Certain State Laws.
 

 

IN MAKING AN INVESTMENT DECISION INVESTORS MUST RELY ON THEIR OWN EXAMINATION OF THE ISSUER AND THE TERMS OF THE OFFERING INCLUDING THE MERITS AND RISKS INVOLVED. THESE SECURITIES HAVE NOT BEEN RECOMMENDED BY ANY FEDERAL OR STATE SECURITIES COMMISSION OR REGULATORY AUTHORITY. FURTHERMORE, THE FOREGOING AUTHORITIES HAVE NOT CONFIRMED THE ACCURACY OR DETERMINED TIE ADEQUACY OF THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

 

24

 

 

 

THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND

MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO

REGISTRATION OR EXEMPTION THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.

 

THE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE NEW YORK UNIFORM SECURITIES

ACT AND, THEREFORE, CANNOT BE RESOLD UNLESS THEY ARE REGISTERED UNDER THE ACT OR UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE.

 

	
            7.  
 	
            Additional Information.
 

 

The Purchaser hereby acknowledges and agrees that the Company may make or cause to be made such further inquiry and obtain such additional information as they may deem appropriate, with regard to the suitability of the undersigned.

 

1. Irrevocability; Binding Effect.

 

The Purchaser hereby acknowledges and agrees that the Subscription hereunder is irrevocable, that the Purchaser is not entitled to cancel, terminate or revoke this Subscription. Agreement or any agreements of the undersigned thereunder and that this Subscription Agreement and such other agreements shall survive the death or disability of the Purchaser and shall be binding upon and inure to the benefit of the parties and their heirs, executors, administrators, successors, legal representatives and assigns. If the Purchaser is more than one person, the obligations of the Purchaser hereunder shall be joint and several and the agreements, representations, warranties and acknowledgments herein contained shall be deemed to be made by and be binding upon each such person and his heirs, executors, legal representatives and assigns. 

 

	
            9.
 	
            Modification.
 

 

Neither this Subscription Agreement nor any provisions hereof shall be waived, modified, discharged or terminated except by an instrument in writing signed by the party against whom any such waiver, modification, discharge or termination is sought.

 

	
            10.
 	
            Notices.
 

 

Any notice, demand or other communication which any party hereto may be required, or may elect, to give to any other party hereunder shall be sufficiently given if (a) deposited, postage prepaid, in a United States mail box, stamped registered or certified mail, return receipt requested, addressed to such address as may be listed on the books of the Company, or (b) delivered personally at such address.

 

25

 

 

 

 

	
            11.  
 	
            Counterparts.
 

 

This Subscription Agreement may be executed through the use of separate signature pages or in any number of counterparts, and each such counterpart shall, for all purposes, constitute one agreement binding on all parties, notwithstanding that all parties are not signatories to the same counterpart.

 

	
            12.  
 	
            Entire Agreement.
 

 

This Subscription Agreement contains the entire agreement of the parties with respect to the subject matter hereof and there are no representations, covenants or other agreements except as stated or referred to herein. 

 

	
            13.  
 	
            Severability.
 

 

Each provision of this Subscription Agreement is intended to be severable from every other provision, and the invalidity or illegality of any Portion hereof shall not affect the validity or legality of the remainder hereof. 

 

	
            14.  
 	
            Assignability.
 

 

	
            This Subscription Agreement is not transferable or assignable by the Purchaser.
 

 

	
            15.  
 	
            Applicable Law.
 

 

This Subscription Agreement shall be governed by and construed in accordance with the laws of the State of New York as applied to residents of that State executing contracts wholly to be performed in that State.

 

	
            16.
 	
            Choice of Jurisdiction.
 

 

The parties agree that any action or proceeding arising, directly, indirectly or otherwise, in connection with, out of or from this Subscription Agreement, any breach hereof or any transaction covered hereby shall be resolved within the County, City and State of New York. Accordingly, the parties consent and submit to the jurisdiction of the United States federal and state courts located within the County, City and State of New York.

 

 

 

26

 

 

 

IN WITNESS THEREOF, the undersigned exercises and agrees to be bound by this Subscription Agreement by executing the Signature Page attached hereto on the date therein indicated.

 

SUBSCRIPTION AGREEMENT

SIGNATURE PAGE

 

By executing this Signature Page, the undersigned hereby executes, adopts and agrees to all terms, conditions and representations of this Subscription Agreement and acknowledges all requirements are met by the purchaser to purchase shares in the Company.

 

Number of Shares Subscribed at $.25 per Share:  ___________________________________

 

Aggregate Purchase Price: $  ____________________________________________________

 

	
            Type of ownership:
 	
            ____________
 	
            Individual
 	
             

	
             
	
            ____________
 	
            Joint Tenants
 	
             

	
             
	
            ____________
 	
            Tenants by the Entirety
 	
             

	
             
	
            ____________
 	
            Tenants in Common
 	
             

	
             
	
            ____________
 	
            Subscribing as Corporation or Partnership
 
	
             
	
            ____________
 	
            Other
 	
             

								

 

	
             
	
            IN WITNESS WHEREOF, the undersigned Purchaser has executed this Signature
 
	
            Page this __________
 	
            day of __________________________
 	
            , 2005.
 	
             

					

 

	
            _____________________________
 	
            ______________________________
 
	
            Exact Name in which Shares are to
 	
            Exact Name in which Shares are to
 	
             

	
             
	
            be Registered
 	
            be Registered
 	
             

						

 

	
            _____________________________
 	
            ______________________________
 
	
            Signature
 	
            Signature
 	
             

 

	
            _____________________________
 	
            ______________________________
 
	
            Print Name
 	
            Print Name
 	
             

 

	
            __________________________
 	
            ______________________________
 
	
            Tax Identification Number:
 	
            Tax Identification Number
 	
             

	
            _____________________________
 	
            ______________________________
 

 

	
            _____________________________
 	
            ______________________________
 
	
            Mailing Address
 	
            Mailing Address
 	
             

	
            _____________________________
 	
            ______________________________
 
	
            Residence Phone Number
 	
            Residence Phone Number
 	
             

				

 

 

 

27

 

 

 

	
            _____________________________
 	
            ______________________________
 
	
            Work Phone Number
 	
            Work Phone Number
 	
             

 

	
            _____________________________
 	
            ______________________________
 
	
            E-Mail Address
 	
            E-Mail Address
 	
             

 

ACCEPTANCE OF SUBSCRIPTION

 

ETWINE, INC. hereby accepts the subscription of ________________Shares as of the ____________day of _________________, 2005.

 

ETWINE, INC.

	
            By:  
 	
            ___________________________________________________________________
 

Name:  ___________________________________________________________________

Title:     ___________________________________________________________________                                 

 

 

28

 

 

 

Exhibit I to Subscription Agreement

 

DEFINITION OF “ACCREDITED INVESTOR”

WITHIN THE MEANING OF REGULATION D

 

An accredited investor means any person who comes within any of the following categories, or whom the Company reasonably believes comes within any of the following categories, at the time of the sale of the Shares to that person: 

 

(i) any bank as defined in Section 3(a)(2) of the Securities Act or any savings and loan association or other institution as defined in Section 3(a)(5)(A) of the Securities Act whether acting in its individual or fiduciary capacity; any broker dealer registered pursuant to Section 15 of the Exchange Act; any insurance company as defined in Section 2(13) of the Securities Act; any investment company registered under the Investment Company Act of 1940 or a business development company as defined in Section 2(a)(48) of that act; any Small Business Investment Company licensed by the U.S., Small Business Administration under Section 301 (c) or (d) of the Small Business Investment Act of 1958; any plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state or its political subdivisions, for the benefit of its employees, if such plan has total
assets in excess of $5,000,000; any employee benefit plan within the meaning of the Employee Retirement Income Security Act of 1974, if the investment decision is made by a plan fiduciary, as defined in Section 3(21) of such act, which is either a bank, savings and loan association, insurance company, or registered investment adviser, or if the employee benefit plan has total assets in excess of $5,000,000, or, if a self-directed plan, with investment decisions made solely by persons that are accredited investors;

 

(ii) any private business development company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940;

 

(iii) any organization described in Section 501(c)(3) of the Internal Revenue Code, corporation, Massachusetts or similar business trust, or partnership, not formed for the specific purpose of acquiring the securities offered, with total assets in excess of $5,000,000;

 

(iv) any of the directors or executive officers of the Company;

 

(v) any natural person whose individual net worth, or joint net worth with that person’s spouse, at the time of investment in the Common Stock, exceeds $250,000;

 

 

 

 

29

 

 

 

(vi) any natural person who had an individual income in excess of $250,000 in each of the two most recent years or joint income with that person’s spouse in excess of $300,000 in each of those years and has a reasonable expectation of reaching that same income level in the current year;

 

(vii) any trust with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the Common Stock, whose purchase is directed by a sophisticated person as described in Rule 506(b)(2)(ii) of Regulation D; or

 

(viii) any entity in which all of the equity owners are accredited investors.

 

 

 

30

 

 

 

Exhibit II to Subscription Agreement

 

PURCHASER QUESTIONNAIRE FOR INDIVIDUALS

 

Purpose of this Questionnaire.

 

Shares of ETwine, Inc., a New York Corporation (the “Company’), are being offered without registration under the Securities Act of 1933, as amended (the “Securities Act”), or the securities laws of certain states, in reliance on the private offering exemption contained in Rule 506 of the Securities Act and on Regulation D of the Securities and Exchange Commission thereunder (“Regulation D”), and in reliance on similar exemptions under certain applicable state laws. The purpose of this Purchaser Questionnaire is to assure the Company that the proposed purchaser meets the standards imposed for the application of such exemptions including, but not limited to, whether the proposed purchaser qualifies as an “accredited investor” as defined in Rule 501 under the Act or a “sophisticated investor” as defined in Rule 506 under the Act, your answers
will at all times be kept strictly confidential. However, by signing this purchaser Questionnaire you agree that the Company may present this Purchaser Questionnaire to such parties as the Company may deem appropriate if called upon under the law to establish the availability of any exemption from registration of the private placement or if the contents hereof are relevant to any issue in any action, suit or proceeding to which the Company is a party or by which it may be bound. The undersigned realizes that this Purchaser Questionnaire does not constitute an offer by the Company to sell shares but is a request for information.

 

THE COMPANY WILL NOT OFFER OR SELL SHARES TO ANY INDIVIDUAL WHO HAS NOT FILLED

OUT, AS THOROUGHLY AS POSSIBLE, A PROSPECTIVE PURCHASER QUESTIONNAIRE.

 

Instructions:

 

One (1) copy of this Questionnaire should be completed, signed, dated and delivered to:

 

	
            eTwine, Inc.
 	
             

	
            Attn:  Mr. Cliff Lerner
 	
             

	
            366 North Broadway, Suite 410
 
	
            Jericho, NY 11753
 	
             

				

 

Please contact Mr. Cliff Lerner at (516) 942-2030 if you have any questions with respect to the Questionnaire.

 

PLEASE ANSWER ALL QUESTIONS. If the appropriate answer is “None” or “Not Applicable,” so state. Please print or type your answers to all questions. Attach additional sheets if necessary to complete your answers to any item.

 

 

 

 

31

 

 

 

 

	
            I.  
 	
            General Information:
 

 

Name:  ________________________________

Date of Birth:  ______________________________

Residence Address:  _______________________________________________________________

Business Address:  ________________________________________________________________

Home Telephone No.: ______________________________________________________________

Business Telephone No:  ____________________________________________________________

E-mail Address:  ___________________________________________________________________

	
            Preferred Mailing Address: ________ Business  
 	
            or  _________  
 	
            Home  (check one)
 

Social Security Number:  ____________________________________________________________

Marital Status:  ____________________________________________________________________

 

	
            II.  
 	
            Financial Condition:
 

 

1. Did your individual annual income during each of 2003 and 2004 exceed $250,000 and do you reasonably expect your individual annual income during 2005 to exceed $250,000?

	
            Yes _______  
 	
            No _______
 

 

2. Did your joint (with spouse) annual income during each of 2003 and 2004 exceed $300,000 and do you reasonably expect your individual annual income during 2005 to exceed $300,000?

	
            Yes _______  
 	
            No  _______
 

 

3. Does your individual or joint net worth exceed $250,000?

	
            Yes _______  
 	
            No  _______
 

 

By signing this Questionnaire I hereby confirm the following statements:

 

 (a) I am aware that the offering of Common Stock will involve securities that are not transferable and for which no market exists, thereby requiring my investment to be maintained for an indefinite period of time.

 

 (b) I acknowledge that any delivery to me of the Memorandum relating to the Shares of Common Stock prior to the determination by the Company of my suitability as an investor, shall not constitute an offer of such Shares until such determination of suitability shall be made, and I agree that I shall promptly return the Memorandum to the Company upon request.

 

 (c) My answers to the foregoing questions are, and were on any date (if any) that I previously subscribed for Shares in the Company, true and complete to the best of my information and belief and were true on any date that I previously as of, and I will promptly notify the Company of any changes in the information I have provided.

 

 

 

 

 

32

 

 

 

Executed:

 

Date:________________  _______________________________________________

	
            (Printed Name)
 

 

Place:  ____________________________________

 

	
            __________________________________________
 
	
             
	
            (Signature)
 	
             

			

 

__________________________________________

	
            (Printed Name of Joint Subscriber)
 

 

 

 

33Exhibit 10.a

    

       

      
        

        

      

      

       

      Credit
        Agreement

       

      Dated
        as of June 27, 2006

       

      among

       

      CTS
        Corporation,

       

      the
        Guarantors from time to time parties hereto,

       

      the
        Lenders from time to time parties hereto,

       

      Harris
        N.A.,

       

      as
        L/C Issuer

       

      and

       

      Harris
        N.A.

      as
        Administrative Agent

       

      
         

        
          

          

        

       

      BMO
        Capital Markets,

       

      as
        Sole Book Runner and Co-Lead Arranger,

       

      and

       

      National
        City Bank of Indiana,

       

      as
        Co-Lead Arranger

       

      

       

      

      
        
          
             

          

          
          

        

        
          
          

          
            

          

        

        
          
          

          
          

        

      

       

      Credit
        Agreement

       

      This
        Credit Agreement is entered into as of June 27, 2006, by and among
        CTS Corporation, an Indiana corporation (the “Borrower”),
        the
        direct and indirect Subsidiaries of the Borrower from time to time party
        to this
        Agreement, as Guarantors, the several financial institutions from time to
        time
        party to this Agreement, as Lenders, Harris N.A., as L/C Issuer, and Harris
        N.A., as Administrative Agent as provided herein. All capitalized terms used
        herein without definition shall have the same meanings herein as such terms
        are
        defined in Section 5.1 hereof.

       

      Preliminary
        Statement

       

      The
        Borrower has requested, and the Lenders have agreed to extend, certain credit
        facilities on the terms and conditions of this Agreement.

       

      Now,
        Therefore,
        in
        consideration of the mutual agreements contained herein, and other good and
        valuable consideration, the receipt and sufficiency of which are hereby
        acknowledged, the parties hereto hereby agree as follows:

       

      
        	
                Section 1.

              	
                The
                  Credit Facilities.

              

      

       

          Section 1.1.    Revolving
        Credit Commitments.
        Subject
        to the terms and conditions hereof, each Lender, by its acceptance hereof,
        severally agrees to make a loan or loans (individually a “Revolving
        Loan”
        and
        collectively the “Revolving
        Loans”)
        in U.S.
        Dollars to the Borrower from time to time on a revolving basis up to the
        amount
        of such Lender’s Revolving Credit Commitment, subject to any reductions thereof
        pursuant to the terms hereof, before the Revolving Credit Termination Date.
        The
        sum of the aggregate principal amount of Revolving Loans, Swing
        Loans, and L/C Obligations at any time outstanding shall not exceed the
        Revolving Credit Commitments in effect at such time. Each Borrowing of Revolving
        Loans shall be made ratably by the Lenders in proportion to their respective
        Revolver Percentages. As provided in Section 1.5(a) hereof, the Borrower
        may elect that each Borrowing of Revolving Loans be either Base Rate Loans
        or
        Eurodollar Loans. Revolving Loans may be repaid and the principal amount
        thereof
        reborrowed before the Revolving Credit Termination Date, subject to the terms
        and conditions hereof.

       

          Section 1.2.    Letters
        of
        Credit.
        (a) General
        Terms.
        Subject
        to the terms and conditions hereof, as part of the Revolving Credit, the
        L/C
        Issuer shall issue standby and commercial letters of credit (each a “Letter
        of Credit”)
        for the
        Borrower’s account and/or for the account of the Borrower and/or one or more of
        its Subsidiaries in an aggregate undrawn face amount up to the L/C Sublimit.
        Notwithstanding anything herein to the contrary, those certain letters of
        credit
        issued for the account of the Borrower by Harris N.A. and listed on Schedule
        1.2
        hereof (the “Existing
        Letters of Credit”)
        shall
        each constitute a “Letter
        of Credit”
        herein
        for all purposes of this Agreement with the Borrower as the applicant therefor,
        to the same extent, and with the same force and effect as if the Existing
        Letters of Credit had been issued under this Agreement at the request of
        the
        Borrower. Each Letter of Credit shall be issued by the L/C Issuer, but each
        Lender shall be obligated to reimburse the L/C Issuer for such Lender’s Revolver
        Percentage of the amount of each drawing thereunder and, accordingly, each
        Letter of Credit shall constitute usage of the Revolving Credit Commitment
        of
        each Lender pro rata in an amount equal to its Revolver Percentage of the
        L/C Obligations then outstanding.

       

          (b)    Applications.
        At any
        time before the Revolving Credit Termination Date, the L/C Issuer shall, at
        the request of the Borrower, issue one or more Letters of Credit in
        U.S. Dollars, in a form reasonably satisfactory to the L/C Issuer, with
        expiration dates no later than the earlier of 12 months from the date of
        issuance (or which are cancelable not later than 12 months from the date of
        issuance and each renewal) and 30 days prior to the Revolving Credit
        Termination Date, in an aggregate face amount as set forth above, upon the
        receipt of an application duly executed by the Borrower and, if such Letter
        of
        Credit is for the account of one of its Subsidiaries, such Subsidiary, in
        the
        form then customarily prescribed by the L/C Issuer for the Letter of Credit
        requested (each an “Application”).
        Notwithstanding anything contained in any Application to the contrary:
        (i) the Borrower shall pay fees in connection with each Letter of Credit as
        set forth in Section 2.1 (b) hereof, (ii) except as otherwise provided
        in Section 1.8 hereof, before the occurrence of an Event of Default, the
        L/C Issuer will not call for the funding by the Borrower of any amount under
        a
        Letter of Credit before being presented with a drawing thereunder, and
        (iii) if the L/C Issuer is not timely reimbursed for the amount of any
        drawing under a Letter of Credit on the date such drawing is paid, the
        Borrower’s obligation to reimburse the L/C Issuer for the amount of such drawing
        shall bear interest (which the Borrower hereby promises to pay) from and
        after
        the date such drawing is paid until the Business Day following the date such
        drawing is paid at a rate per annum equal to the Applicable Margin plus
        the Base
        Rate from time to time in effect (computed on the basis of a year of 365
        or 366
        days, as the case may be, and the actual number of days elapsed) and thereafter
        at a rate per annum equal to the sum of 2.0% plus
        the
        Applicable Margin plus
        the
        Base
        Rate from time to time in effect (computed on the basis of a year of 365
        or
        366 days, as the case may be, and the actual number of days elapsed). If
        the L/C Issuer issues any Letter of Credit with an expiration date that is
        automatically extended unless the L/C Issuer gives notice that the expiration
        date will not so extend beyond its then scheduled expiration date, unless
        the
        Required Lenders instruct the L/C Issuer otherwise, the L/C Issuer will
        give such notice of non-renewal before the time necessary to prevent such
        automatic extension if before such required notice date: (i) the expiration
        date of such Letter of Credit if so extended would be after the Revolving
        Credit
        Termination Date, (ii) the Revolving Credit Commitments have been
        termi-nated, or (iii) a Default or an Event of Default exists and the
        Administrative Agent, at the request or with the consent of the Required
        Lenders, has given the L/C Issuer instructions not to so permit the extension
        of
        the expiration date of such Letter of Credit. The L/C Issuer agrees to issue
        amendments to the Letter(s) of Credit increasing the amount, or extending
        the
        expiration date, thereof at the request of the Borrower subject to the
        conditions of Section 7 hereof and the other terms of this
        Section 1.2.

       

          (c)    The
        Reimbursement Obligations.
        Subject
        to Section 1.2(b) hereof, the obligation of the Borrower to reimburse the
        L/C Issuer for all drawings under a Letter of Credit (a “Reimbursement
        Obligation”)
        shall
        be governed by the Application related to such Letter of Credit, except that
        reimbursement shall be made by no later than 12:00 Noon (Chicago
        time) on
        the
        date when each drawing is to be paid in immediately available funds at the
        Administrative Agent’s principal office in Chicago, Illinois or such other
        office as the Administrative Agent may designate in writing to the Borrower
        (who
        shall thereafter cause to be distributed to the L/C Issuer such amount(s)
        in like funds). If the Borrower does not make any such reimbursement payment
        on
        the date due and the Participating Lenders fund their participations therein
        in
        the manner set forth in Section 1.2(d) below, then all payments thereafter
        received by the Administrative Agent in discharge of any of the relevant
        Reimbursement Obligations shall be distributed in accordance with
        Section 1.2(d) below.

       

          (d)    The
        Participating Interests.
        Each
        Lender (other than the Lender acting as L/C Issuer in issuing the relevant
        Letter of Credit), by its acceptance hereof, severally agrees to purchase
        from
        the L/C Issuer, and the L/C Issuer hereby agrees to sell to each such Lender
        (a
“Participating
        Lender”),
        an
        undivided percentage participating interest (a “Participating
        Interest”),
        to the
        extent of its Revolver Percentage, in each Letter of Credit issued by, and
        each
        Reimbursement Obligation owed to, the L/C Issuer. Upon any failure by the
        Borrower to pay any Reimburse-ment Obligation at the time required on the
        date
        the related drawing is to be paid, as set forth in Section 1.2(c) above, or
        if the L/C Issuer is required at any time to return to the Borrower or to
        a
        trustee, receiver, liquidator, custodian or other Person any portion of any
        payment of any Reimbursement Obligation, each Participating Lender shall,
        not
        later than the Business Day it receives a certificate in the form of
        Exhibit A hereto from the L/C Issuer (with a copy to the Administrative
        Agent) to such effect, if such certificate is received before 1:00 p.m.
        (Chicago time), or not later than 1:00 p.m. (Chicago time) the following
        Business Day, if such certificate is received after such time, pay to the
        Administrative Agent for the account of the L/C Issuer an amount equal to
        such
        Participating Lender’s Revolver Percentage of such unpaid or recap-tured
        Reimbursement Obligation together with interest on such amount accrued from
        the
        date the related payment was made by the L/C Issuer to the date of such payment
        by such Participating Lender at a rate per annum equal to: (i) from the
        date the related payment was made by the L/C Issuer to the date two
        (2) Business Days after payment by such Participating Lender is due
        hereunder, the Federal Funds Rate for each such day and (ii) from the date
        two (2) Business Days after the date such payment is due from such
        Participating Lender to the date such payment is made by such Participating
        Lender, the Base Rate in effect for each such day. Each such Participating
        Lender shall thereafter be entitled to receive its Revolver Percentage of
        each
        payment received in respect of the relevant Reimbursement Obligation and
        of
        interest paid thereon, with the L/C Issuer retaining its Revolver Percentage
        thereof as a Lender hereunder. 

       

      The
        several obligations of the Participating Lenders to the L/C Issuer under
        this
        Section 1.2 shall be absolute, irrevocable and unconditional under any and
        all circumstances whatsoever and shall not be subject to any set-off,
        counterclaim or defense to payment which any Participating Lender may have
        or
        have had against the Borrower, the L/C Issuer, the Administrative Agent,
        any
        Lender or any other Person whatsoever except in the case of the gross negligence
        or willful misconduct of the L/C Issuer. Without limiting the generality
        of the
        foregoing, such obligations shall not be affected by any Default or Event
        of
        Default or by any reduction or termination of any Revolving Credit Commitment
        of
        any Lender, and each payment by a Participating Lender under this
        Section 1.2 shall be made without any offset, abatement, withholding or
        reduction whatsoever. 

       

          (e)        Indemnification.
        The
        Participating Lenders shall, to the extent of their respective Revolver
        Percentages, indemnify the L/C Issuer (to the extent not reimbursed by the
        Borrower) against any cost, expense (including reasonable counsel fees and
        disbursements), claim, demand, action, loss or liability (except such as
        result
        from the L/C Issuer’s gross negligence or willful misconduct) that the L/C
        Issuer may suffer or incur in connection with any Letter of Credit issued
        by it.
        The obligations of the Participating Lenders under this Section 1.2(e) and
        all other parts of this Section 1.2 shall survive termination of this
        Agreement and of all Applications, Letters of Credit, and all drafts and
        other
        documents presented in connection with drawings thereunder.

       

          (f)    Manner
        of Requesting a Letter of Credit.
        The
        Borrower shall provide at least five (5) Business Days’ advance written
        notice to the Administrative Agent of each request for the issuance of a
        Letter
        of Credit, such notice in each case to be accompanied by an Application for
        such
        Letter of Credit properly completed and executed by the Borrower and, in
        the
        case of an extension or an increase in the amount of a Letter of Credit,
        a
        written request therefor, in a form reasonably acceptable to the Administrative
        Agent and the L/C Issuer. The Administrative Agent shall promptly notify
        the L/C Issuer of the Administrative Agent’s receipt of each such notice and the
        L/C Issuer shall promptly notify the Administrative Agent and the Lenders
        of the
        issuance of the Letter of Credit so requested.

       

          Section 1.3.    Applicable
        Interest Rates.
        (a) Base
        Rate Loans.
        Subject
        to the provisions of Section 1.9, each Base Rate Loan made or maintained by
        a Lender shall bear interest during each Interest Period it is outstanding
        (computed on the basis of a year of 365 or 366 days, as the case may be,
        and the actual number of days elapsed) on the unpaid principal amount thereof
        from the date such Loan is advanced, continued or created by conversion from
        a
        Eurodollar Loan until such Loan is repaid at a rate per annum equal to the
        sum
        of the Applicable Margin plus
        the Base
        Rate from time to time in effect, payable on the last day of such Interest
        Period and at maturity (whether by acceleration or otherwise).

       

      “Base
        Rate”
        means
        for any day the greater of: (i) the rate of interest announced or otherwise
        established by the Administrative Agent from time to time as its prime
        commercial rate as
        in
        effect on such day, with any change in the Base Rate resulting from a change
        in
        said prime commercial rate to be effective as of the date of the relevant
        change
        in said prime commercial rate (it being acknowledged and agreed that such
        rate
        may not be the Administrative Agent’s best or lowest rate) and (ii) the sum
        of (x) the rate determined by the Administrative Agent to be the average
        (rounded upward, if necessary, to the next higher 1/100 of 1%) of the rates
        per
        annum quoted to the Administrative Agent at approximately 10:00 a.m. (Chicago
        time) (or as soon thereafter as is practicable) on such day (or, if such
        day is
        not a Business Day, on the immediately preceding Business Day) by two or
        more
        Federal funds brokers selected by the Administrative Agent for sale to the
        Administrative Agent at face value of Federal funds in the secondary market
        in
        an amount equal or comparable to the principal amount owed to the Administrative
        Agent for which such rate is being determined, plus
        (y) 1/2
        of 1%.

       

          (b)    Eurodollar
        Loans.
        Each
        Eurodollar Loan made or maintained by a Lender shall bear interest during
        each
        Interest Period it is outstanding (computed on the basis of a year of 360
        days
        and the actual number of days elapsed) on the unpaid principal amount thereof
        from the date such Loan is advanced, continued or created by conversion from
        a
        Base Rate Loan until maturity (whether by acceleration or otherwise) at a
        rate
        per annum equal to the sum of the Applicable Margin plus
        the
        Adjusted LIBOR applicable for such Interest Period, payable on the last day
        of
        the Interest Period and at maturity (whether by acceleration or otherwise),
        and,
        if the applicable Interest Period is longer than three months, on each day
        occurring every three months after the commencement of such Interest
        Period.

       

      “Adjusted
        LIBOR”
        means,
        for any Borrowing of Eurodollar Loans, a rate per annum determined in accordance
        with the following formula:

       

      Adjusted
        LIBOR =                               LIBOR                     

      1
        -
        Eurodollar Reserve Percentage

       

      “Eurodollar
        Reserve Percentage”
        means,
        for any Borrowing of Eurodollar Loans, the daily average for the applicable
        Interest Period of the maximum rate, expressed as a decimal, at which reserves
        (including, without limitation, any supplemental, marginal, and emergency
        reserves) are imposed during such Interest Period by the Board of Governors
        of
        the Federal Reserve System (or any successor) on “eurocurrency
        liabilities”,
        as
        defined in such Board’s Regulation D (or in respect of any other category
        of liabilities that includes deposits by reference to which the interest
        rate on
        Eurodollar Loans is determined or any category of extensions of credit or
        other
        assets that include loans by non-United States offices of any Lender to United
        States residents), subject to any amendments of such reserve requirement
        by such
        Board or its successor, taking into account any transitional adjustments
        thereto. For purposes of this definition, the Eurodollar Loans shall be deemed
        to be “eurocurrency
        liabilities”
        as
        defined in Regulation D without benefit or credit for any prorations,
        exemptions or offsets under Regulation D.

       

      “LIBOR”
        means,
        for an Interest Period for a Borrowing of Eurodollar Loans, (a) the LIBOR
        Index Rate for such Interest Period, if such rate is available, and (b) if
        the LIBOR Index Rate cannot be determined, the arithmetic average of the
        rates
        of interest per annum (rounded upwards, if necessary, to the nearest 1/100
        of
        1%) at which deposits in U.S. Dollars in immediately available funds are
        offered
        to the Administrative Agent at 11:00 a.m. (London, England time) two
        (2) Business Days before the beginning of such Interest Period by three (3)
        or more major banks in the interbank eurodollar market selected by the
        Administrative Agent for delivery on the first day of and for a period equal
        to
        such Interest Period and in an amount equal or comparable to the principal
        amount of the Eurodollar Loan scheduled to be made by the Administrative
        Agent
        as part of such Borrowing.

       

      “LIBOR
        Index Rate”
        means,
        for any Interest Period, the rate per annum (rounded upwards, if necessary,
        to
        the next higher one hundred-thousandth of a percentage point) for deposits
        in
        U.S. Dollars for a period equal to such Interest Period, which appears on
        the
        Telerate Page 3750 as of 11:00 a.m. (London, England time) on the day
        two (2) Business Days before the commencement of such Interest
        Period.

       

      “Telerate
        Page 3750”
        means
        the display designated as “Page
        3750”
        on the
        Dow Jones Markets Service (formerly known as the Telerate Service) (or such
        other page as may replace Page 3750 on that service or such other service
        as may
        be nominated by the British Bankers’ Association as the information vendor for
        the purpose of displaying British Bankers’ Association Interest Settlement Rates
        for U.S. Dollar deposits).

       

          (c)    Rate
        Determinations. The
        Administrative Agent shall determine each interest rate applicable to the
        Loans
        and the Reimbursement Obligations hereunder, and its determination thereof
        shall
        be conclusive and binding except in the case of manifest error. 

       

          Section 1.4.    Minimum
        Borrowing Amounts; Maximum Eurodollar Loans.
        Each
        Borrowing of Base Rate Loans advanced under a Credit shall be in an amount
        not
        less than $1,000,000 or such greater amount which is an integral multiple
        of
        $100,000. Each Borrowing of Eurodollar Loans advanced, continued or converted
        shall be in an amount equal to $2,000,000 or such greater amount which is
        an
        integral multiple of $100,000. Without the Administrative Agent’s consent, there
        shall not be more than ten (10) Borrowings of Eurodollar Loans outstanding
        under
        the Revolving Credit at any one time; provided
        that not
        more than two (2) of such Borrowings shall have an Interest Period of one
        week.

       

          Section 1.5.    Manner
        of Borrowing Loans and Designating Applicable Interest Rates.
        (a) Notice
        to the Administrative Agent.
        The
        Borrower shall give notice to the Administrative Agent
        by
        no later than 12:00 noon (Chicago time): (i) at least three
        (3) Business Days before the date on which the Borrower requests the
        Lenders to advance a Borrowing of Eurodollar Loans and (ii) on the date the
        Borrower requests the Lenders to advance a Borrowing of Base Rate Loans.
        The
        Loans included in each Borrowing shall bear interest initially at the type
        of
        rate specified in such notice of a new Borrowing. Thereafter, the Borrower
        may
        from time to time elect to change or continue the type of interest rate borne
        by
        each Borrowing or, subject to the minimum amount requirement for each
        outstanding Borrowing contained in Section 1.4, a portion thereof, as
        follows: (i) if such Borrowing is of Eurodollar Loans, on the last day of
        the Interest Period applicable thereto, the Borrower may continue part or
        all of
        such Borrowing as Eurodollar Loans or convert part or all of such Borrowing
        into
        Base Rate Loans or (ii) if such Borrowing is of Base Rate Loans, on any
        Business Day, the Borrower may convert all or part of such Borrowing into
        Eurodollar Loans for an Interest Period or Interest Periods specified by
        the
        Borrower. The Borrower shall give all such notices requesting the advance,
        continuation or conversion of a Borrowing to the Administrative Agent
        by
        telephone or telecopy (which notice shall be irrevocable once given and,
        if by
        telephone, shall be promptly confirmed in writing), substantially in the
        form
        attached hereto as Exhibit B (Notice of Borrowing) or Exhibit C
        (Notice of Continuation/Conversion), as applicable, or in such other form
        acceptable to the Administrative Agent.
        Notice of the continuation of a Borrowing of Eurodollar Loans for an additional
        Interest Period or of the conversion of part or all of a Borrowing of Base
        Rate
        Loans into Eurodollar Loans must be given by no later than 12:00 noon
        (Chicago time) at least three (3) Business Days before the date of the
        requested continuation or conversion. All such notices concerning the advance,
        continuation or conversion of a Borrowing shall specify the date of the
        requested advance, continuation or conversion of a Borrowing (which shall
        be a
        Business Day), the amount of the requested Borrowing to be advanced, continued
        or converted, the type of Loans to comprise such new, continued or converted
        Borrowing and, if such Borrowing is to be comprised of Eurodollar Loans,
        the
        Interest Period applicable thereto. The Borrower agrees that the Administrative
        Agent may rely on any such telephonic or telecopy notice given by any person
        the
        Administrative Agent in good faith believes is an Authorized Representative
        without the necessity of independent investigation and, in the event any
        such
        notice by telephone conflicts with any written confirmation, such telephonic
        notice shall govern if the Administrative Agent has acted in reliance
        thereon.

       

          (b)    Notice
        to the
        Lenders.
        The
        Administrative Agent shall give prompt telephonic or telecopy notice to each
        Lender of any notice from the Borrower received pursuant to Section 1.5(a)
        above and, if such notice requests the Lenders to make Eurodollar Loans,
        the
        Administrative Agent shall give notice to the Borrower and each Lender by
        like
        means of the interest rate applicable thereto promptly after the Administrative
        Agent has made such determination.

       

          (c)    Borrower’s
        Failure to Notify; Automatic Continuations and Conversions.
        Any
        outstanding Borrowing of Base Rate Loans shall automatically be continued
        for an
        additional Interest Period on the last day of its then current Interest Period
        unless the Borrower has notified the Administrative Agent within the period
        required by Section 1.5(a) that the Borrower intends to convert such
        Borrowing, subject to Section 7.1 hereof, into a Borrowing of Eurodollar
        Loans or such Borrowing is prepaid in accordance with Section 1.8(a). If
        the
        Borrower fails to give notice pursuant to Section 1.5(a) above of the
        continuation or conversion of any outstanding principal amount of a Borrowing
        of
        Eurodollar Loans before the last day of its then current Interest Period
        within
        the period required by Section 1.5(a) or, whether or not such notice has
        been given, one or more of the conditions set forth in Section 7.1 for the
        continuation or conversion of a Borrowing of Eurodollar Loans would not be
        satisfied, and such Borrowing is not prepaid in accordance with
        Section 1.8(a), such Borrowing shall automatically be converted into a
        Borrowing of Base Rate Loans. 

       

          (d)    Disbursement
        of Loans.
        Not
        later than 1:00 p.m. (Chicago time) on the date of any requested advance of
        a new Borrowing, subject to Section 7 hereof, each Lender shall make
        available its Loan comprising part of such Borrowing in funds immediately
        available at the principal office of the Administrative Agent in Chicago,
        Illinois. The Administrative Agent shall make the proceeds of each new Borrowing
        available to the Borrower at the Administrative Agent’s principal office in
        Chicago, Illinois.

       

          (e)    Administrative
        Agent
        Reliance on Lender Funding.
        Unless
        the Administrative Agent shall have been notified by a Lender prior to (or,
        in
        the case of a Borrowing of Base Rate Loans, by 1:00 p.m. (Chicago time) on)
        the date on which such Lender is scheduled to make payment to the Administrative
        Agent of the proceeds of a Loan (which notice shall be effective upon receipt)
        that such Lender does not intend to make such payment, the Administrative
        Agent
        may assume that such Lender has made such payment when due and the
        Administrative Agent may in reliance upon such assumption (but shall not
        be
        required to) make available to the Borrower the proceeds of the Loan to be
        made
        by such Lender and, if any Lender has not in fact made such payment to the
        Administrative Agent, such Lender shall, on demand, pay to the Administrative
        Agent the amount made available to the Borrower attributable to such Lender
        together with interest thereon in respect of each day during the period
        commencing on the date such amount was made available to the Borrower and
        ending
        on (but excluding) the date such Lender pays such amount to the Administrative
        Agent at a rate per annum equal to: (i) from the date the related advance
        was made by the Administrative Agent to the date two (2) Business Days after
        payment by such Lender is due hereunder, the Federal Funds Rate for each
        such
        day and (ii) from the date two (2) Business Days after the date such
        payment is due from such Lender to the date such payment is made by such
        Lender,
        the Base Rate in effect for each such day. If such amount is not received
        from
        such Lender by the Administrative Agent immediately upon demand, the Borrower
        will, on demand, repay to the Administrative Agent the proceeds of the Loan
        attributable to such Lender with interest thereon at a rate per annum equal
        to
        the interest rate applicable to the relevant Loan, but without such payment
        being considered a payment or prepayment of a Loan under Section 1.11
        hereof so that the Borrower will have no liability under such Section with
        respect to such payment.

       

          Section 1.6.    Interest
        Periods.
        As
        provided in Section 1.5(a) and 1.14 hereof,
        at the time of each request to advance, continue or create by conversion
        a
        Borrowing of Eurodollar Loans or Swing Loans, the Borrower shall select an
        Interest Period applicable to such Loans from among the available options.
        The
        term “Interest
        Period”
        means
        the period commencing on the date a Borrowing of Loans is advanced, continued
        or
        created by conversion and ending: (a) in the case of Base Rate Loans, on
        the
        last day of the calendar quarter (i.e.,
        the
        last day of March, June, September or December, as applicable) in which such
        Borrowing is advanced, continued or created by conversion (or on the last
        day of
        the following calendar quarter if such Loan is advanced, continued or created
        by
        conversion on the last day of a calendar quarter), (b) in the case of a
        Eurodollar Loan, one week, two weeks, 1, 2, 3 or 6 months thereafter, and
        (c) in the case of a Swing Loan, on the date 1 to 7 days thereafter as
        mutually agreed to by the Borrower and the Administrative Agent; provided,
        however, that:

       

      (a)    any
        Interest
        Period for a Borrowing of Revolving Loans or Swing Loans that otherwise would
        end after the Revolving Credit Termination Date shall end on the Revolving
        Credit Termination Date; 

       

      (b)    whenever
        the
        last day of any Interest Period would otherwise be a day that is not a Business
        Day, the last day of such Interest Period shall be extended to the next
        succeeding Business Day, provided
        that,
        if such
        extension would cause the last day of an Interest Period for a Borrowing
        of
        Eurodollar Loans to occur in the following calendar month, the last day of
        such
        Interest Period shall be the immediately preceding Business Day;
        and

       

      (c)    for
        purposes of determining an Interest Period for a Borrowing of Eurodollar
        Loans,
        a month means a period starting on one day in a calendar month and ending
        on the
        numerically corresponding day in the next calendar month; provided,
        however, that
        if
        there is no numerically corresponding day in the month in which such an Interest
        Period is to end or if such an Interest Period begins on the last Business
        Day
        of a calendar month, then such Interest Period shall end on the last Business
        Day of the calendar month in which such Interest Period is to end.

       

      Section 1.7.     Maturity
        of
        Loans. Each
        Revolving Loan and Swing Loan, both for principal and interest not sooner
        paid,
        shall mature and become due and payable by the Borrower on the Revolving
        Credit
        Termination Date.

       

          Section 1.8.    Prepayments.
        (a) Optional.
        The
        Borrower shall have the privilege of prepaying without premium or penalty
        (except as set forth in Section 1.11 below) and in whole or in part (but,
        if in part, then: (i) if such Borrowing is of Base Rate Loans, in an amount
        not less than $100,000, (ii) if such Borrowing is of Eurodollar Loans, in
        an amount not less than $500,000, and (iii) in each case, in an amount such
        that the minimum amount required for a Borrowing pursuant to Section 1.4
        and 1.14 hereof remains outstanding) any Borrowing of Eurodollar Loans at
        any
        time upon three (3) Business Days prior notice by the Borrower to the
        Administrative Agent or, in the case of a Borrowing of Base Rate Loans, notice
        delivered by the Borrower to the Administrative Agent no later than
        12:00 noon (Chicago time) on the date of prepayment, such prepayment to be
        made by the payment of the principal amount to be prepaid and, in the case
        of
        any Eurodollar Loans or Swing Loans, accrued interest thereon to the date
        fixed
        for prepayment plus
        any
        amounts due the Lenders under Section 1.11 hereof. 

       

          (b)    Mandatory.
        (i)     The
        Borrower
        shall, on each date the Revolving Credit Commitments are reduced pursuant
        to
        Section 1.12 hereof, prepay the Revolving Loans, Swing Loans, and, if
        necessary, prefund the L/C Obligations in accordance with Section 9.4 by
        the amount, if any, necessary to reduce the sum of the aggregate principal
        amount of Revolving Loans, Swing Loans, and L/C Obligations then outstanding
        to
        the amount to which the Revolving Credit Commitments have been so reduced.
        

       

          (ii)    Unless
        the
        Borrower otherwise directs, prepayments of Loans under this Section 1.8(b)
        shall be applied first to Borrowings of Base Rate Loans until payment in
        full
        thereof with any balance applied to Borrowings of Eurodollar Loans in the
        order
        in which their Interest Periods expire. Each prepayment of Loans under this
        Section 1.8(b) shall be made by the payment of the principal amount to be
        prepaid and accrued interest thereon to the date of prepayment and, in the
        case
        of any Eurodollar Loan or Swing Loan, together with any amounts due the Lenders
        under Section 1.11 hereof. Each prefunding of L/C Obligations shall be made
        in accordance with Section 9.4 hereof.

       

          (c)    The
        Administrative Agent will promptly advise each Lender of any notice of
        prepayment it receives from the Borrower. Any amount of Revolving Loans and
        Swing Loans paid or prepaid before the Revolving Credit Termination Date
        may,
        subject to the terms and conditions of this Agreement, be borrowed, repaid
        and
        borrowed again. 

       

          Section 1.9.    Default
        Rate.
        Notwithstanding anything to the contrary contained in Section 1.3 hereof,
        while any Event of Default exists or after acceleration, the Borrower shall
        pay
        interest (after as well as before entry of judgment thereon to the extent
        permitted by law) on the principal amount of all Loans and Reimbursement
        Obligations, and letter of credit fees then owing by it at a rate per annum
        equal to:

       

      (a)    for
        any Base
        Rate Loan or any Swing Loan bearing interest based on the Base Rate, the
        sum of
        2.0% plus
        the
        Applicable Margin plus
        the Base
        Rate from time to time in effect; 

       

      (b)    for
        any
        Eurodollar Loan or any Swing Loan bearing interest at the Quoted Rate, the
        sum
        of 2.0% plus
        the rate
        of interest in effect thereon at the time of such default until the end of
        the
        Interest Period applicable thereto and, thereafter, at a rate per annum equal
        to
        the sum of 2.0% plus
        the
        Applicable Margin for Base Rate Loans plus
        the Base
        Rate from time to time in effect;

       

      (c)    for
        any
        Reimbursement Obligation, the sum of 2.0% plus
        the
        amounts due under Section 1.2(c) with respect to such Reimbursement
        Obligation; and

       

      (d)    for
        any
        Letter of Credit, the sum of 2.0% plus
        the
        letter of credit fee due under the second sentence of Section 2.1(b) with
        respect to such Letter of Credit;

       

      provided,
        however, that
        in
        the absence of acceleration, any adjustments pursuant to this Section shall
        be
        made at the election of the Administrative Agent, acting at the request or
        with
        the consent of the Required Lenders, with written notice to the Borrower.
        While
        any Event of Default exists or after acceleration, interest shall be paid
        on
        demand of the Administrative Agent at the request or with the consent of
        the
        Required Lenders. 

       

          Section 1.10.    Evidence
        of Indebtedness.
        (a) Each Lender shall maintain in accordance with its usual practice an
        account or accounts evidencing the indebtedness of the Borrower to such Lender
        resulting from each Loan made by such Lender from time to time, including
        the
        amounts of principal and interest payable and paid to such Lender from time
        to
        time hereunder.

       

          (b)    The
        Administrative Agent shall also maintain accounts in which it will record
        (i) the amount of each Loan made hereunder, the type thereof and the
        Interest Period with respect thereto, (ii) the amount of any principal or
        interest due and payable or to become due and payable from the Borrower to
        each
        Lender hereunder and (iii) the amount of any sum received by the
        Administrative Agent hereunder from the Borrower and each Lender’s share
        thereof.

       

          (c)    The
        entries
        maintained in the accounts maintained pursuant to paragraphs (a) and (b)
        above shall be prima
        facie
        evidence
        of the existence and amounts of the Obligations therein recorded; provided,
        however, that
        the
        failure of the Administrative Agent or any Lender to maintain such accounts
        or
        any error therein shall not in any manner affect the obligation of the Borrower
        to repay the Obligations in accordance with their terms.

       

          (d)    Any
        Lender
        may request that its Loans be evidenced by a promissory note or notes in
        the
        forms of Exhibit D-1 (in the case of its Revolving Loans and referred to
        herein
        as a “Revolving
        Note”)
        or D-2
        (in the case of its Swing Loans and referred to herein as a “Swing
        Note”),
        as
        applicable (Revolving Notes and Swing Note being hereinafter referred to
        collectively as the “Notes”
        and
        individually as a “Note”).
        In
        such event, the Borrower shall prepare, execute and deliver to such Lender
        a
        Note payable to the order of such Lender in the amount of the relevant
        Commitment or Swing Line Sublimit, as applicable. Thereafter, the Loans
        evidenced by such Note or Notes and interest thereon shall at all times
        (including after any assignment pursuant to Section 13.12) be represented
        by one or more Notes payable to the order of the payee named therein or any
        assignee pursuant to Section 13.12, except to the extent that any such
        Lender or assignee subsequently returns any such Note for cancellation and
        requests that such Loans once again be evidenced as described in
        subsections (a) and (b) above.

       

          Section 1.11.    Funding
        Indemnity.
        If any
        Lender shall incur any loss, cost or expense (including, without limitation,
        any
        loss, cost or expense incurred by reason of the liquidation or re-employment
        of
        deposits or other funds acquired by such Lender to fund or maintain any
        Eurodollar Loan or Swing Loan or the relending or reinvesting of such deposits
        or amounts paid or prepaid to such Lender, but excluding any loss of profit)
        as
        a result of:

       

      (a)    any
        payment,
        prepayment or conversion of a Eurodollar Loan or Swing Loan on a date other
        than
        the last day of its Interest Period, 

       

      (b)    any
        failure (because of a failure to meet the conditions of Section 7 or
        otherwise) by the Borrower to borrow or continue a Eurodollar Loan or Swing
        Loan, or  to  convert
        a Base Rate Loan into a
        Eurodollar Loan or Swing Loan, on the date specified in a notice given pursuant
        to Section 1.5(a) or 1.14 hereof,

       

      (c)    any
        failure by the Borrower to make any payment of principal on any Eurodollar
        Loan
        or Swing Loan when due (whether by acceleration or otherwise), or

       

      (d)    any
        acceleration of the maturity of a Eurodollar Loan or Swing Loan as a result
        of
        the occurrence of any Event of Default hereunder,

       

      then,
        upon the demand of such Lender, the Borrower shall pay to such Lender such
        amount as will reimburse such Lender for such loss, cost or expense. If any
        Lender makes such a claim for compensation, it shall provide to the Borrower,
        with a copy to the Administrative Agent, a certificate setting forth the
        amount
        of such loss, cost or expense in reasonable detail (including an explanation
        of
        the basis for and the computation of such loss, cost or expense) and the
        amounts
        shown on such certificate, absent manifest error, shall be deemed prime
        facie
        correct.

       

          Section 1.12.    Commitment
        Terminations.
        (a) Optional
        Revolving Credit Terminations. The
        Borrower shall have the right at any time and from time to time, upon five
        (5) Business Days, prior written notice to the Administrative Agent (or
        such shorter time period agreed to by the Administrative Agent), to terminate
        the Revolving Credit Commitments without premium or penalty and in whole
        or in
        part, any partial termination to be (i) in an amount not less than
        $1,000,000 and (ii) allocated ratably among the Lenders in proportion to
        their respective Revolver Percentages, provided
        that
        the
        Revolving Credit Commitments may not be reduced to an amount less than the
        sum
        of the aggregate principal amount of Revolving Loans, Swing Loans, and
        L/C Obligations then outstanding. Any termination of the Revolving Credit
        Commitments below the L/C Sublimit or Swing Line Sublimit then in effect
        shall reduce the L/C Sublimit and Swing Line Sublimit, as applicable, by a
        like amount. The Administrative Agent shall give prompt notice to each Lender
        of
        any such termination of the Revolving Credit Commitments.

       

          (b)    Any
        termination of the Revolving Credit Commitments pursuant to this
        Section 1.12 may not be reinstated.

       

          (c)    For
        the
        avoidance of doubt, prepayments pursuant to Sections 1.8(a) shall not
        result in any reduction of the Revolving Credit Commitments.

       

          Section 1.13.    Substitution
        of Lenders.
        (a) Upon the receipt by the Borrower of a claim from any Lender for
        compensation under Section 10.3 or 13.1 hereof, or a notice by any Lender
        to the Borrower of any illegality pursuant to Section 10.1 hereof or
        (b) in the event any Lender is in default in any material respect with
        respect to its obligations under the Loan Documents (any such Lender referred
        to
        in clause (a) or (b) above being hereinafter referred to as an “Affected
        Lender”),
        the
        Borrower may, in addition to any other rights the Borrower may have hereunder
        or
        under applicable law, require, at its expense, any such Affected Lender to
        assign, at par plus
        accrued
        interest and fees, without recourse, all of its interest, rights, and
        obligations hereunder (including its Revolving Credit Commitment and all
        of its
        Loans and participation interests in Letters of Credit and other amounts
        at any
        time owing to it hereunder and the other Loan Documents) to a bank or other
        institutional lender specified by the Borrower, provided
        that
        (i) such assignment shall not conflict with or violate any law, rule or
        regulation or order of any court or other governmental authority, (ii) the
        Borrower shall have received the written consent of the Administrative Agent,
        which consent shall not be unreasonably withheld or delayed, to such assignment,
        (iii) the Borrower shall have paid to the Affected Lender all monies
        (together with amounts due such Affected Lender under Section 1.11 hereof
        as if the Loans owing to it were prepaid rather than assigned) other than
        such
        principal, interest, and fees accrued and owing to it hereunder, and
        (iv) the assignment is entered into in accordance with the other
        requirements of Section 13.12 hereof. 

       

          Section 1.14.    Swing
        Loans.
        (a) Generally.
        Subject
        to the terms and conditions hereof, as part of the Revolving Credit, the
        Administrative Agent agrees to make loans to the Borrower under the Swing
        Line
        (individually a “Swing
        Loan”
        and
        collectively the “Swing
        Loans”)
        which
        shall not in the aggregate at any time outstanding exceed the Swing Line
        Sublimit. The Swing Loans may be availed of the Borrower from time to time
        and
        borrowings thereunder may be repaid and used again during the period ending
        on
        the Revolving Credit Termination Date; provided
        that
        each Swing Loan must be repaid on the last day of the Interest Period applicable
        thereto. Each Swing Loan shall be in a minimum amount of $250,000 or such
        greater amount which is an integral multiple of $100,000. 

       

          (b)    Interest
        on Swing Loans.
        Each
        Swing Loan shall bear interest until maturity (whether by acceleration or
        otherwise) at a rate per annum equal to (i) the sum of the Base Rate
plus
        the
        Applicable Margin for Base Rate Loans under the Revolving Credit as from
        time to
        time in effect (computed on the basis of a year of 365 or 366 days, as the
        case
        may be, for the actual number of days elapsed) or (ii) the Quoted Rate
        (computed on the basis of a year of 360 days for the actual number of days
        elapsed). Interest on each Swing Loan shall be due and payable prior to such
        maturity on the last day of each Interest Period applicable
        thereto.

       

          (c)    Requests
        for
        Swing Loans.
        The
        Borrower shall give the Administrative Agent prior notice (which may be written
        or oral) no later than 2:00 p.m. (Chicago time) on the date upon which a
        Borrower requests that any Swing Loan be made, of the amount and date of
        such
        Swing Loan, and the Interest Period requested therefor. Within 30 minutes
        after receiving such notice, the Administrative Agent shall in its discretion
        quote an interest rate to the Borrower at which the Administrative Agent
        would
        be willing to make such Swing Loan available to the Borrower for the Interest
        Period so requested (the rate so quoted for a given Interest Period being
        herein
        referred to as “Quoted
        Rate”).
        The
        Borrower acknowledges and agrees that the interest rate quote is given for
        immediate and irrevocable acceptance. If the Borrower does not so immediately
        accept the Quoted Rate for the full amount requested by the Borrower for
        such
        Swing Loan, the Quoted Rate shall be deemed immediately withdrawn and such
        Swing
        Loan shall bear interest at the rate per annum determined by adding the
        Applicable Margin for Base Rate Loans under the Revolving Credit to the Base
        Rate as from time to time in effect. Subject to the terms and conditions
        hereof,
        the proceeds of such Swing Loan shall be made available to the Borrower on
        the
        date so requested at the offices of the Administrative Agent in Chicago,
        Illinois. Anything contained in the foregoing to the contrary notwithstanding
        (i) the obligation of the Administrative Agent to make Swing Loans shall be
        subject to all of the terms and conditions of this Agreement and (ii) the
        Administrative Agent shall not be obligated to make more than one Swing Loan
        during any one day. 

       

          (d)    Refunding
        Loans.
        In its
        sole and absolute discretion, the Administrative Agent may at any time, on
        behalf of the Borrower (which hereby irrevocably authorizes the Administrative
        Agent to act on its behalf for such purpose) and with notice to the Borrower,
        request each Lender to make a Revolving Loan in the form of a Base Rate Loan
        in
        an amount equal to such Lender’s Revolver Percentage of the amount of the Swing
        Loans outstanding on the date such notice is given. Unless an Event of Default
        described in Section 9.1(j) or 9.1(k) exists with respect to the Borrower,
        regardless of the existence of any other Event of Default, each Lender shall
        make the proceeds of its requested Revolving Loan available to the
        Administrative Agent, in immediately available funds, at the Administrative
        Agent’s principal office in Chicago, Illinois, before 12:00 Noon (Chicago
        time) on the Business Day following the day such notice is given. The proceeds
        of such Borrowing of Revolving Loans shall be immediately applied to repay
        the
        outstanding Swing Loans.

       

          (e)    Participations.
        If any
        Lender refuses or otherwise fails to make a Revolving Loan when requested
        by the
        Administrative Agent pursuant to Section 1.14(d) above (because an Event of
        Default described in Section 9.1(j) or 9.1(k) exists with respect to the
        Borrower or otherwise), such Lender will, by the time and in the manner such
        Revolving Loan was to have been funded to the Administrative Agent, purchase
        from the Administrative Agent an undivided participating interest in the
        outstanding Swing Loans in an amount equal to its Revolver Percentage of
        the
        aggregate principal amount of Swing Loans that were to have been repaid with
        such Revolving Loans. Each Lender that so purchases a participation in a
        Swing
        Loan shall thereafter be entitled to receive its Revolver Percentage of each
        payment of principal received on the Swing Loan and of interest received
        thereon
        accruing from the date such Lender funded to the Administrative Agent its
        participation in such Loan. The several obligations of the Lenders under
        this
        Section shall be absolute, irrevocable and unconditional under any and all
        circumstances whatsoever and shall not be subject to any set-off, counterclaim
        or defense to payment which any Lender may have or have had against the
        Borrower, any other Lender or any other Person whatever. Without limiting
        the
        generality of the foregoing, such obligations shall not be affected by any
        Default or Event of Default or by any reduction or termination of the Revolving
        Credit Commitments of any Lender, and each payment made by a Lender under
        this
        Section shall be made without any offset, abatement, withholding or reduction
        whatsoever.

       

          Section 1.15.    Increase
        in Commitments.  The
        Borrower may, with the written consent of the Administrative Agent (which
        consent shall not be unreasonably withheld or delayed), increase the aggregate
        amount of the Revolving Credit Commitments by delivering a Commitment Amount
        Increase Request at least five (5) Business Days prior to the desired
        effective date of such increase (the “Commitment
        Amount Increase”)
        identifying an additional Lender (or additional Revolving Credit Commitments
        for
        existing Lender(s)) and the amount of its Revolving Credit Commitment (or
        additional amount of its Revolving Credit Commitment(s)); provided,
        however, that
        (i) any increase of the aggregate amount of the Revolving Credit
        Commitments to an amount in excess of $150,000,000 will require the approval
        of
        the Required Lenders, and (ii) any increase of the aggregate amount of the
        Revolving Credit Commitments shall be in an amount not less than $25,000,000.
        The effective date of the Commitment Amount Increase shall be agreed upon
        by the
        Borrower and the Administrative Agent. Upon the effectiveness thereof, the
        new
        Lender(s) (or, if applicable, existing Lender(s)) shall advance Loans in
        an
        amount sufficient such that after giving effect to its Loans each Bank shall
        have outstanding its pro
        rata
        share of
        Loans. It shall be a condition to such effectiveness that (i) either no
        Eurodollar Loans be outstanding on the date of such effectiveness or the
        Borrower pays any applicable breakage cost under Section 1.11 incurred by
        any Lender resulting from the repayment of its Loans and (ii) the Borrower
        shall not have terminated any portion of the Revolving Credit Commitments
        pursuant to Section 1.14 hereof. The Borrower agrees to pay any reasonable
        expenses of the Administrative Agent relating to any Commitment Amount Increase.
        Notwithstanding anything herein to the contrary, no Lender shall have any
        obligation to increase its Revolving Credit Commitment and no Lender’s Revolving
        Credit Commitment shall be increased without its consent thereto, and each
        Lender may at its option, unconditionally and without cause, decline to increase
        its Revolving Credit Commitment.

       

      
        	
                Section 2.

              	
                Fees.

              

      

       

          Section 2.1.    Fees.   (a)   Revolving
        Credit
        Commitment Fee.
        The
        Borrower shall pay to the Administrative Agent for the ratable account of
        the
        Lenders in accordance with their Revolver Percentages a commitment fee at
        the
        rate per annum equal to the Applicable Margin (computed on the basis of a
        year
        of 365 or 366 days, as the case may be, and the actual number of days
        elapsed) on the average daily Unused Revolving Credit Commitments. Such
        commitment fee shall be payable quarterly in arrears on the last day of each
        March, June, September, and December in each year (commencing on the first
        such
        date occurring after the date hereof) and on the Revolving Credit Termination
        Date, unless the Revolving Credit Commitments are terminated in whole on
        an
        earlier date, in which event the commitment fee for the period to the date
        of
        such termination in whole shall be paid on the date of such
        termination.

       

          (b)    Letter
        of Credit Fees.
        On the
        date of issuance or extension, or increase in the amount, of any Letter of
        Credit pursuant to Section 1.2 hereof, the Borrower shall pay to the L/C
        Issuer for its own account an issuance fee equal to 0.125% of the face amount
        of
        (or of the increase in the face amount of) such Letter of Credit. Quarterly
        in
        arrears, on the last day of each March, June, September, and December,
        commencing on the first such date occurring after the date hereof, the Borrower
        shall pay to the Administrative Agent, for the ratable benefit of the Lenders
        in
        accordance with their Revolver Percentages, a letter of credit fee at a rate
        per
        annum equal to the Applicable Margin (computed on the basis of a year of
        365 or
        366 days, as the case may be, and the actual number of days elapsed) in
        effect during each day of such quarter applied to the daily average face
        amount
        of Letters of Credit outstanding during such quarter. In addition, the Borrower
        shall pay to the L/C Issuer for its own account the L/C Issuer’s standard
        issuance, drawing, negotiation, amendment, assignment and other administrative
        fees for each Letter of Credit. Such standard fees referred to in the preceding
        sentence may be established by the L/C Issuer from time to time as notified
        to
        the Borrower in writing. 

       

          (c)    Administrative
        Agent Fees.
        The
        Borrower shall pay to the Administrative Agent, for its own use and benefit,
        the
        fees agreed to between the Administrative Agent and the Borrower in a fee
        letter
        dated the date hereof or as otherwise agreed to in writing between
        them.

       

      
        	
                Section 3.

              	
                Place
                  and Application of Payments.

              

      

       

          Section 3.1.  Place
        and Application of
        Payments.
        All
        payments of principal of and interest on the Loans and the Reimbursement
        Obligations, and of all other Obligations payable by the Borrower under this
        Agreement and the other Loan Documents, shall be made by the Borrower to
        the
        Administrative Agent by no later than 12:00 Noon (Chicago time) on the due
        date
        thereof at the office of the Administrative Agent in Chicago, Illinois (or
        such
        other location as the Administrative Agent may designate to the Borrower)
        for
        the benefit of the Lender or Lenders entitled thereto. Any payments received
        after such time shall be deemed to have been received by the Administrative
        Agent on the next Business Day. All such payments shall be made in U.S. Dollars,
        in immediately available funds at the place of payment, in each case without
        set-off or counterclaim. The Administrative Agent will promptly thereafter
        cause
        to be distributed like funds relating to the payment of principal or interest
        on
        Loans and on Reimbursement Obligations in which the Lenders have purchased
        Participating Interests ratably to the Lenders and like funds relating to
        the
        payment of any other amount payable to any Lender to such Lender, in each
        case
        to be applied in accordance with the terms of this Agreement.

       

      Anything
        contained herein to the contrary notwithstanding, all payments and collections
        received in respect of the Obligations by the Administrative Agent or any
        of the
        Lenders after acceleration or the final maturity of the Obligations or
        termination of the Commitments as a result of an Event of Default shall be
        remitted to the Administrative Agent and distributed as follows:

       

      (a)    first,
        to
        the payment of any outstanding costs and expenses incurred by the Administrative
        Agent in protecting, preserving or enforcing rights under the Loan Documents,
        and in any event all costs and expenses of a character which the Borrower
        has
        agreed to pay the Administrative Agent under Section 13.15 hereof (such
        funds to be retained by the Administrative Agent for its own account unless
        it
        has previously been reimbursed for such costs and expenses by the Lenders,
        in
        which event such amounts shall be remitted to the Lenders to reimburse them
        for
        payments theretofore made to the Administrative Agent);

       

      (b)    second,
        to
        the payment of any outstanding interest and fees due under the Loan Documents
        to
        be allocated pro rata in accordance with the aggregate unpaid amounts owing
        to
        each Person to which such sums are due;

       

      (c)    third,
        to
        the payment of principal on the Loans, unpaid Reimbursement Obligations,
        together with amounts to be held by the Administrative Agent as collateral
        security for any outstanding L/C Obligations pursuant to Section 9.4
        hereof (until the Administrative Agent is holding an amount of cash equal
        to the
        then outstanding amount of all such L/C Obligations), and any Hedging
        Liability, the aggregate amount paid to, or held as collateral security for,
        the
        Lenders and, in the case of Hedging Liability, their Affiliates to be allocated
        pro
        rata
        in
        accordance with the aggregate unpaid amounts owing to each Person to which
        such
        sums are due; 

       

      (d)    fourth,
        to
        the payment of all other unpaid Obligations to be allocated pro
        rata
        in
        accordance with the aggregate unpaid amounts owing to each Person to which
        such
        sums are due; and

       

      (e)    fifth,
        to
        the Borrower or whoever else may be lawfully entitled thereto.

       

      
        	
                Section 4.

              	
                The
                  Guaranties.

              

      

       

          Section 4.1.    Guaranties.  The
        payment and performance of the Obligations, Hedging Liability, and Funds
        Transfer and Deposit Account Liability shall at all times be guaranteed by
        such
        direct and indirect Subsidiaries of the Borrower as are from time to time
        required to become Guarantors hereunder pursuant to Section 12 hereof
        pursuant to one or more guaranty agreements or Additional Guarantor Supplements,
        each in form and substance reasonably acceptable to the Administrative Agent,
        as
        the same may be amended, modified or supplemented from time to time
        (individually a “Guaranty”
        and
        collectively the “Guaranties”);
        provided,
        however,
        that a
        Foreign Subsidiary shall
        not
        be required to be a guarantor hereunder.

       

          Section 4.2.    Further
        Assurances.   In
        the event the Borrower
        or any Subsidiary forms or acquires any other Subsidiary after the date hereof,
        the Borrower shall promptly upon such formation or acquisition cause such
        newly
        formed or acquired Subsidiary to execute a Guaranty or Additional Guarantor
        Supplement as the Administrative Agent may then require in accordance with
        Section 12, and the Borrower shall also deliver to the Administrative
        Agent, or cause such Subsidiary to deliver to the Administrative Agent, at
        the
        Borrower’s cost and expense, such other instruments, documents, certificates,
        and opinions reasonably required by the Administrative Agent in connection
        therewith.

       

      
        	
                Section 5.

              	
                Definitions;
                  Interpretation.

              

      

       

          Section 5.1.    Definitions.
        The
        following terms when used herein shall have the following meanings:

       

      “Acquired
        Business”
        means
        the entity or assets acquired by the Borrower or a Subsidiary in an Acquisition,
        whether before or after the date hereof.

       

      “Acquisition”
        means
        any transaction or series of related transactions for the purpose of or
        resulting, directly or indirectly, in (a) the acquisition of all or
        substantially all of the assets of a Person, or of any business or division
        of a
        Person, (b) the acquisition of in excess of 50% of the capital stock,
        partnership interests, membership interests or equity of any Person (other
        than
        a Person that is a Subsidiary prior to such acquisition), or otherwise causing
        any Person to become a Subsidiary, or (c) a merger or consolidation or any
        other combination with another Person (other than a Person that is a Subsidiary
        prior to such acquisition) provided that the Borrower or the Subsidiary is
        the
        surviving entity.

       

      “Additional
        Guarantor Supplement” means
        an
        Additional Guarantor Supplement in the form of Exhibit G hereto.

       

      “Administrative
        Questionnaire” means
        an
        administrative questionnaire in a form supplied by the Administrative
        Agent.

       

      “Adjusted
        EBITDA”
        means,
        with reference to any period, Net Income for such period plus
        (a) the
        sum of all amounts deducted in arriving at such Net Income amount in respect
        of
        (i) Interest Expense for such period, (ii) federal, state, and local
        income taxes for such period, (iii) depreciation of fixed assets and
        amortization of intangible assets for such period, (iv) non-cash charges
        (including, without limitation, option expenses), (b) up to $4,000,000 in
        any
        four fiscal quarter period (but in no event more than $12,000,000 in the
        aggregate from the Closing Date) of restructuring expenses paid in cash or
        charges relating to disputes with customers and (c) an amount calculated
        by the
        Borrower and approved by the Administrative Agent in its reasonable discretion
        equal to the Adjusted EBITDA (calculated without giving effect to this clause
        (c)) of the Persons or assets which are the subject of each Permitted
        Acquisition as if such Permitted Acquisition was completed on the first day
        of
        such period to the extent not subsequently sold or otherwise disposed of
        during
        such period minus
        to the
        extent included in computing Net Income, non-cash income, including, without
        limitation, non-cash income that would constitute “prepaid pension expense” on
        the financial statements of the Borrower in accordance with GAAP.

       

      “Adjusted
        LIBOR”
        is
        defined in Section 1.3(b) hereof.

       

      “Administrative
        Agent” means
        Harris N.A. and any successor appointed pursuant to Section 11.7
        hereof.

       

      “Affiliate”
        means
        any Person directly or indirectly controlling or controlled by, or under
        direct
        or indirect common control with, another Person. A Person shall be deemed
        to
        control another Person for the purposes of this definition if such Person
        possesses, directly or indirectly, the power to direct, or cause the direction
        of, the management and policies of the other Person, whether through the
        ownership of voting securities, common directors, trustees or officers, by
        contract or otherwise; provided
        that,
        in any
        event for purposes of this definition, any Person that owns, directly or
        indirectly, 5% or more of the securities having the ordinary voting power
        for
        the election of directors or governing body of a corporation or 5% or more
        of
        the partnership or other ownership interest of any other Person (other than
        as a
        limited partner of such other Person) will be deemed to control such corporation
        or other Person. 

       

      “Agreement”
        means
        this Credit Agreement, as the same may be amended, modified, restated or
        supplemented from time to time pursuant to the terms hereof.

       

      “Applicable
        Margin”
        means,
        with respect to Loans, Reimbursement Obligations, and the commitment fees
        and
        letter of credit fees payable under Section 2.1 hereof until the first
        Pricing Date (defined below), the rates per annum shown opposite Level II
        below, and, thereafter, from one Pricing Date to the next Pricing Date means
        the
        applicable margin determined in accordance with the following
        schedule:

       

       

      
        	
                 Level

              	
                 Leverage
                  Ratio for Such Pricing Date

              	
                 Applicable
                  Margin for Base Rate Loans and Reimbursement
                  Obligations shall be:

              	
                 Applicable
                  Margin for Eurodollar Loans and Latter of
                  Credit Fee shall be:

              	
                 Applicable
                  Margin for Commitment Fee shall
                  be:

              
	 	 	 	 	 
	
                 V

              	
                 Greater
                  than or equal to 2.5 to 1.0

              	
                 0.00%

              	
                 1.25%

              	
                 0.250%

              
	 	 	 	 	 
	
                 IV

              	 Less than 2.5 to 1.0 but greater than or equal to
                2.0 to 1.0   	
                 0.00%

              	
                 1.00%

              	
                 0.225%

              
	 	 	 	 	 
	
                 III

              	 Less than 2.0 to 1.0 but greater than or equal to
                1.5 to 1.0	
                 0.00%

              	
                 0.875%

              	
                 0.200%

              
	 	 	 	 	 
	
                 II

              	 Less than 1.5 to 1.0 but greater than or equal to
                1.0 to 1.0	
                 0.00%

              	
                 0.700%

              	
                 0.150%

              
	 	 	 	 	 
	
                 I

              	 Less than 1.0 to 1.0	
                 0.00%

              	
                 0.575%

              	
                 0.125%

              

      

       

      For
        purposes hereof, the term “Pricing
        Date”
        means,
        for any fiscal quarter of the Borrower ending on or after June 30, 2006,
        the date on which the Administrative Agent is in receipt of the Borrower’s most
        recent financial statements (and, in the case of the year-end financial
        statements, audit report) for the fiscal quarter then ended, pursuant to
        Section 8.5 hereof. The Applicable Margin shall be established based
        on the Leverage Ratio for the most recently completed fiscal quarter and
        the
        Applicable Margin established on a Pricing Date shall remain in effect until
        the
        next Pricing Date. If the Borrower has not delivered its financial statements
        by
        the date such financial statements (and, in the case of the year-end financial
        statements, audit report) are required to be delivered under Section 8.5
        hereof, until such financial statements and audit report are delivered, the
        Applicable Margin shall be the highest Applicable Margin (i.e.,
        the
        Leverage Ratio shall be deemed to be greater than 2.5 to 1.0). If the Borrower
        subsequently delivers such financial statements before the next Pricing Date,
        the Applicable Margin established by such late delivered financial statements
        shall take effect from the date of delivery until the next Pricing Date.
        In all
        other circumstances, the Applicable Margin established by such financial
        statements shall be in effect from the Pricing Date that occurs immediately
        after the end of the fiscal quarter covered by such financial statements
        until
        the next Pricing Date. Each determination of the Applicable Margin made by
        the
        Administrative Agent in accordance with the foregoing shall be conclusive
        and
        binding on the Borrower and the Lenders if reasonably determined.

       

      “Application”
        is
        defined in Section 1.2(b) hereof.

       

      “Approved
        Fund” means
        any
        Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a
        Lender or (c) an entity or an Affiliate of an entity that administers or
        manages
        a Lender.

       

      “Assignment
        and Acceptance”
        means an
        assignment and acceptance entered into by a Lender and an assignee in accordance
        with the terms of Section 13.12 hereof (with the consent of any party whose
        consent is required by Section 13.12 hereof), and accepted by the
        Administrative Agent, in substantially the form of Exhibit H or any other
        form approved by the Administrative Agent.

       

      “Authorized
        Officer”
        means
        the Chief Executive Officer, President, Vice President Finance, Treasurer
        or
        Assistant Treasurer of the Borrower, acting singly.

       

      “Authorized
        Representative”
        means
        those persons shown on the list of officers provided by the Borrower pursuant
        to
        Section 7.2 (h) hereof or on any update of any such list provided by the
        Borrower to the Administrative Agent, or any further or different officers
        of
        the Borrower so named by any Authorized Representative of the Borrower in
        a
        written notice to the Administrative Agent.

       

      “Base
        Rate”
        is
        defined in Section 1.3(a) hereof.

       

      “Base
        Rate Loan”
        means a
        Loan bearing interest at a rate specified in Section 1.3(a)
        hereof.

       

      “Borrower”
        is
        defined in the introductory paragraph of this Agreement.

       

      “Borrower’s
        Shareholder Rights Plan”
means
        the Rights Agreement between CTS Corporation and National City Bank, N.A.
        (successor to EquiServe Trust Company, N.A.) dated August 28, 1998, as amended,
        as the same may be amended, modified or replaced from time to time by the
        Borrower.

       

      “Borrowing”
        means
        the total of Loans of a single type advanced, continued for an additional
        Interest Period, or converted from a different type into such type by the
        Lenders under a Credit on a single date and, in the case of Eurodollar Loans,
        for a single Interest Period. Borrowings of Revolving Loans are made and
        maintained ratably by each of the Lenders according to their Revolver
        Percentages. A Borrowing is “advanced”
        on the
        day Lenders advance funds comprising such Borrowing to the Borrower, is
“continued”
        on the
        date a new Interest Period for the same type of Loans commences for such
        Borrowing, and is “converted”
        when
        such Borrowing is changed from one type of Loan to the other, all as requested
        by the Borrower pursuant to Section 1.5(a) hereof. Borrowings of Swing
        Loans are made by the Administrative Agent in accordance with the procedures
        set
        forth in Section 1.14 hereof.

       

      “Business
        Day”
        means
        any day (other than a Saturday or Sunday) on which banks are not authorized
        or
        required to close in Chicago, Illinois and, if the applicable Business Day
        relates to the advance or continuation of, or conversion into, or payment
        of a
        Eurodollar Loan, on which banks are dealing in U.S. Dollar deposits in the
        interbank eurodollar market in London, England. 

       

      “Capital
        Lease”
        means
        any lease of Property which in accordance with GAAP is required to be
        capitalized on the balance sheet of the lessee.

       

      “Capitalized
        Lease Obligation”
        means,
        for any Person, the amount of the liability shown on the balance sheet of
        such
        Person in respect of a Capital Lease determined in accordance with
        GAAP.

       

      “CERCLA”
        means
        the
        Comprehensive Environmental Response, Compensation and Liability Act of 1980,
        as
        amended by the Superfund Amendments and Reauthorization Act of 1986, 42 U.S.C.
        §§9601
        et
        seq.,
        and any
        future amendments.

       

      “Change
        of Control”
        means
        any of (a) the acquisition by any “person”
        or
“group”
        (as such
        terms are used in sections 13(d) and 14(d) of the Securities Exchange Act
        of 1934, as amended) at any time of beneficial ownership of 20% or more of
        the
        outstanding capital stock or other equity interest of the Borrower on a
        fully-diluted basis, (b) the failure of individuals who are members of the
        board of directors (or similar governing body) of the Borrower on the Closing
        Date (together with any new or replacement directors whose initial nomination
        for election was approved by a majority of the directors who were either
        directors on the Closing Date or previously so approved) to constitute a
        majority of the board of directors (or similar governing body) of the Borrower
        or (c) any “Change
        of Control Transaction”
        or event
        of like import under and as defined in the Subordinated Notes.

       

      “Closing
        Date”
        means
        the date of this Agreement or such later Business Day upon which each condition
        described in Section 7.2 shall be satisfied or waived in a manner
        acceptable to the Administrative Agent in its discretion.

       

      “Code”
        means
        the Internal Revenue Code of 1986, as amended, and any successor statute
        thereto.

       

      “Collateral
        Account”
        is
        defined in Section 9.4 hereof.

       

      “Commitment
        Amount Increase”
        is
        defined in Section 1.15 hereof.

       

      “Commitment
        Amount Increase Request”
        means a
        Commitment Amount Increase Request in the form of Exhibit E
        hereto.

       

      “Controlled
        Group”
        means
        all members of a controlled group of corporations and all trades or businesses
        (whether or not incorporated) under common control which, together with the
        Borrower, are treated as a single employer under Section 414 of the
        Code.

       

      “Credit”
        means
        either the Revolving Credit or the Swing Line.

       

      “Credit
        Event”
        means
        the initial advancing of any Loan, the continuation of or conversion of a
        Loan
        into a Eurodollar Loan, or the issuance of, or extension of the expiration
        date
        or increase in the amount of, any Letter of Credit.

       

      “Default”
        means
        any event or condition the occurrence of which would, with the passage of
        time
        or the giving of notice, or both, constitute an Event of Default.

       

      “Disposition”
        means
        the sale, lease, conveyance or other disposition of Property, other than
        sales
        or other dispositions expressly permitted under Section 8.10
        hereof.

       

      “Domestic
        Subsidiary”
        means
        each subsidiary which is organized under the laws of any jurisdiction of
        the
        United States of America.

       

      “Eligible
        Line of Business”
        means
        any business similar to any lines of business engaged in as of the date of
        this
        Agreement by the Borrower or any of its Subsidiaries and businesses reasonably
        incidental or ancillary thereto.

       

      “Environmental
        Claim” means
        any
        investigation, notice, violation, demand, allegation, action, suit, injunction,
        judgment, order, consent decree, penalty, fine, lien, pro-ceeding or claim
        (whether administrative, judicial or private in nature) arising
        (a) pursuant to, or in connection with an actual or alleged violation of,
        any Environmental Law, (b) in connection with any Hazardous Material,
        (c) from any abatement, removal, remedial, cor-rective or response action
        in connection with a Hazardous Material, Environmental Law or order of a
        governmental authority or (d) from any actual or alleged damage, injury,
        threat or harm to health, safety, natural resources or the
        environment.

       

      “Environmental
        Law”
        means
        any current or future Legal Requirement pertaining to (a) the protection of
        health, safety and the indoor or outdoor environment, (b) the conservation,
        management or use of natural resources and wildlife, (c) the protection or
        use
        of surface water or groundwater, (d) the management, manufacture, possession,
        presence, use, generation, transportation, treatment, storage, disposal,
        Release, threatened Release, abatement, removal, remediation or handling
        of, or
        exposure to, any Hazardous Material or (e) pollution (including any Release
        to
        air, land, surface water or groundwater), and any amendment, rule, regulation,
        order or directive issued thereunder.

       

      “ERISA”
        means
        the Employee Retirement Income Security Act of 1974, as amended, or any
        successor statute thereto.

       

      “Eurodollar
        Loan”
        means a
        Loan bearing interest at the rate specified in Section 1.3(b)
        hereof.

       

      “Eurodollar
        Reserve Percentage”
        is
        defined in Section 1.3(b) hereof.

       

      “Event
        of Default”
        means
        any event or condition identified as such in Section 9.1
        hereof.

       

      “Federal
        Funds Rate”
        means
        the fluctuating interest rate per annum described in part (x) of clause (ii)
        of
        the definition of Base Rate appearing in Section 1.3(a) hereof.

       

      “Fixed
        Charges”
        means,
        with reference to any period, the sum of (a) all scheduled payments of
        principal made or to be made during such period with respect to Indebtedness
        for
        Borrowed Money of the Borrower and its Subsidiaries, plus
        (b) Interest Expense for such period (to the extent payable in cash),
plus
        (c) all dividends of the Borrower paid in cash during such period,
plus
        (d) federal,
        state, and local income taxes paid in cash by the Borrower and its Subsidiaries
        during such period.

       

      “Foreign
        Subsidiary”
        means
        each Subsidiary which is organized under the laws of a jurisdiction other
        than
        the United States of America or any state thereof.

       

      “Fund”
        means
        any
        Person (other than a natural person) that is (or will be) engaged in making,
        purchasing, holding or otherwise investing in commercial loans and similar
        extensions of credit in the ordinary course.

       

      “Funds
        Transfer and Deposit Account Liability”
        means
        the liability of the Borrower or any of its Subsidiaries owing to any of
        the
        Lenders, or any Affiliates of such Lenders, arising out of (a) the
        execution or processing of electronic transfers of funds by automatic clearing
        house transfer, wire transfer or otherwise to or from the deposit accounts
        of
        the Borrower and/or any Subsidiary now or hereafter maintained with any of
        the
        Lenders or their Affiliates, (b) the acceptance for deposit or the honoring
        for payment of any check, draft or other item with respect to any such deposit
        accounts, and (c) any other deposit, disbursement, and cash management
        services afforded to the Borrower or any such Subsidiary by any of such Lenders
        or their Affiliates.

       

      “GAAP”
        means
        generally accepted accounting principles set forth from time to time in the
        opinions and pronouncements of the Accounting Principles Board and the American
        Institute of Certified Public Accountants and statements and pronouncements
        of
        the Financial Accounting Standards Board (or agencies with similar functions
        of
        comparable stature and authority within the U.S. accounting profession),
        which
        are applicable to the circumstances as of the date of
        determination.

       

      “Guarantor”
        and
“Guarantors”
        each is
        defined in Section 12.1 hereof.

       

      “Guaranty”
        and
“Guaranties”
        each is
        defined in Section 4.1 hereof.

       

      “Hazardous
        Material” means
        any
        substance, chemical, compound, product, solid, gas, liquid, waste, byproduct,
        pollutant, contaminant or material which is hazardous or toxic, and includes,
        without limitation, (a) asbestos, polychlorinated biphenyls and petroleum
        (including crude oil or any fraction thereof) and (b) any material classified
        or
        regulated as “hazardous” or “toxic” or words of like import pursuant to an
        Environmental Law.

       

      “Hazardous
        Material Activity”
        means
        any activity, event or occurrence involving a Hazardous Material, including,
        without limitation, the manufacture, possession, presence, use, generation,
        transportation, treatment, storage, disposal, Release, threatened Release,
        abatement, removal, remediation, handling of or corrective or response action
        to
        any Hazardous Material.

       

      “Hedging
        Liability”
        means
        the liability of the Borrower or any Subsidiary to any of the Lenders, or
        any
        Affiliates of such Lenders, in respect of any interest rate, foreign currency,
        and/or commodity swap, exchange, cap, collar, floor, forward, future or option
        agreement, or any other similar interest rate, currency or commodity hedging
        arrangement, as the Borrower or such Subsidiary, as the case may be, may
        from
        time to time enter into with any one or more of the Lenders or their Affiliates.
        

       

      “Hostile
        Acquisition”
        means
        the acquisition of the capital stock or other equity interests of a Person
        through a tender offer or similar solicitation of the owners of such capital
        stock or other equity interests which has not been approved (prior to such
        acquisition) by resolutions of the Board of Directors of such Person or by
        similar action if such Person is not a corporation, or to which such approval
        has been withdrawn.

       

      “Indebtedness
        for Borrowed Money”
        means
        for any Person (without duplication) (a) all indebtedness of such Person
        for borrowed money, whether current or funded, or secured or unsecured,
        (b) all indebtedness for the deferred purchase price of Property or
        services, (c) all indebtedness created or arising under any conditional
        sale or other title retention agreement with respect to Property acquired
        by
        such Person (even though the rights and remedies of the seller or lender
        under
        such agreement in the event of a default are limited to repossession or sale
        of
        such Property), (d) all indebtedness secured by a purchase money mortgage
        or other Lien to secure all or part of the purchase price of Property subject
        to
        such mortgage or Lien, (e) all obligations under leases which shall have
        been or must be, in accordance with GAAP, recorded as Capital Leases in respect
        of which such Person is liable as lessee, (f) any liability in respect of
        banker’s acceptances or letters of credit (other than obligations in respect of
        undrawn letters of credit securing current account payables or performance
        obligations in the ordinary course of business), and (g) any indebtedness,
        whether or not assumed, secured by Liens on Property acquired by such Person
        at
        the time of acquisition thereof, it being understood that the term “Indebtedness
        for Borrowed Money” shall not include trade payables arising in the ordinary
        course of business. 

       

      “Interest
        Expense”
        means,
        with reference to any period, the sum of all interest charges (including
        imputed
        interest charges with respect to Capitalized Lease Obligations and all
        amortization of debt discount and expense) net of interest income of the
        Borrower and its Subsidiaries for such period determined on a consolidated
        basis
        in accordance with GAAP. 

       

      “Interest
        Period”
        is
        defined in Section 1.6 hereof.

       

      “Knowledge”
        means
        the
        actual knowledge of an Authorized Officer.

       

      “L/C
        Issuer”
        means
        Harris N.A.

       

      “L/C
        Obligations”
        means
        the aggregate undrawn face amounts of all outstanding Letters of Credit and
        all
        unpaid Reimbursement Obligations.

       

      “L/C
        Sublimit”
        means
        $10,000,000, as reduced pursuant to the terms hereof.

       

      “Legal
        Requirement”
        means
        any treaty, convention, statute, law, regulation, ordinance, license, permit,
        governmental approval, injunction, judgment, order, consent decree or other
        requirement of any governmental authority, whether federal, state, or
        local.

       

      “Lenders”
        means
        and includes the financial institutions from time to time party to this
        Agreement, including each assignee Lender pursuant to Section 13.12 hereof
        and each new Lender pursuant to Section 1.15 hereof.

       

      “Lending
        Office”
        is
        defined in Section 10.4 hereof.

       

      “Letter
        of Credit”
        is
        defined in Section 1.2(a) hereof.

       

      “Leverage
        Ratio”
        means,
        as of the last day of any fiscal quarter of the Borrower, the ratio of Total
        Funded Debt of the Borrower and its Subsidiaries as of the last day of such
        fiscal quarter to Adjusted EBITDA of the Borrower and its Subsidiaries for
        the
        period of four fiscal quarters then ended.

       

      “LIBOR”
        is
        defined in Section 1.3(b) hereof.

       

      “Lien”
        means
        any
        mortgage, lien, security interest, pledge, charge or encumbrance of any kind
        in
        respect of any Property, including the interests of a vendor or lessor under
        any
        conditional sale, Capital Lease or other title retention
        arrangement.

       

      “Loan”
        means
        any Revolving Loan or Swing Loan, whether outstanding as a Base Rate Loan
        or
        Eurodollar Loan or otherwise, each of which is a “type”
        of Loan
        hereunder.

       

      “Loan
        Documents”
        means
        this Agreement, the Notes, the Applications, the Guaranties, and each other
        instrument or document to be delivered hereunder or thereunder or otherwise
        in
        connection therewith.

       

      “Material
        Adverse Effect”
        means
        (a) a material adverse change in, or material adverse effect upon, the
        operations, business, Property, or financial condition of the Borrower and
        its
        Subsidiaries taken as a whole, (b) a material impairment of the ability of
        the Borrower or any Subsidiary to perform its material obligations under
        any
        Loan Document or (c) a material adverse effect upon the legality, validity,
        binding effect or enforceability against the Borrower or any Subsidiary of
        any
        Loan Document or the rights and remedies of the Administrative Agent and
        the
        Lenders thereunder.

       

      “Material
        Subsidiary”
means,
        at any time, each Domestic Subsidiary that, together with its Subsidiaries,
        shall have accounted for more than 5% of Adjusted EBITDA for the four
        consecutive fiscal quarters of the Borrower most recently ended; provided
        that if,
        at any time, the Domestic Subsidiaries that are not Material Subsidiaries
        (collectively, the “Non-Material
        Subsidiaries”)
        account
        for 10% or more in the aggregate of Adjusted EBIDTA for the four consecutive
        fiscal quarters of the Borrower most recently ended, then the Borrower shall
        designate one or more additional Domestic Subsidiaries as Material Subsidiaries
        to the effect that, after such designation, all the remaining Non-Material
        Subsidiaries, taken as a whole, would not account for 10% or more in the
        aggregate of Adjusted EBIDTA for the four consecutive fiscal quarters of
        the
        Borrower most recently ended; provided,
        however,
        that no
        SPV, nor any other Subsidiary subject to special regulation preventing it
        from
        guaranteeing the Indebtedness of the Borrower hereunder, shall be designated
        as
        a Material Subsidiary. 

       

      “Moody’s”
        means
        Moody’s Investors Service, Inc.

       

      “Net
        Income”
        means,
        with reference to any period, the net income (or net loss) of the Borrower
        and
        its Subsidiaries for such period computed on a consolidated basis in accordance
        with GAAP; provided
        that
        there shall be excluded from Net Income (a) the net income (or net loss) of
        any Person accrued prior to the date it becomes a Subsidiary of, or has merged
        into or consolidated with, the Borrower or another Subsidiary, and (b) the
        net income (or net loss) of any Person (other than a Subsidiary) in which
        the
        Borrower or any of its Subsidiaries has a equity interest, except to the
        extent
        of the amount of dividends or other distributions actually paid to the Borrower
        or any of its Subsidiaries during such period. 

       

      “Notes”
        is
        defined in Section 1.10(d) hereof.

       

      “Obligations”
        means
        all obligations of the Borrower to pay principal and interest on the Loans,
        all
        Reimbursement Obligations owing under the Applications, all fees and charges
        payable hereunder, and all other payment obligations of the Borrower or any
        of
        its Subsidiaries arising under or in relation to any Loan Document, in each
        case
        whether now existing or hereafter arising, due or to become due, direct or
        indirect, absolute or contingent, and howsoever evidenced, held or
        acquired.

       

      “Participating
        Interest”
        is
        defined in Section 1.2(d) hereof.

       

      “Participating
        Lender”
        is
        defined in Section 1.2(d) hereof.

       

      “PBGC”
        means
        the Pension Benefit Guaranty Corporation or any Person succeeding to any
        or all
        of its functions under ERISA.

       

      “Permitted
        Acquisition”
        means
        any Acquisition with respect to which all of the following conditions shall
        have
        been satisfied:

       

          (a)    the
        Acquired Business is in an Eligible Line of Business;

       

          (b)    the
        Acquisition shall not be a Hostile Acquisition;

       

          (c)    the
        financial statements of the Acquired Business shall have been audited by
        an
        independent accounting firm of national or regional repute or otherwise
        reasonably satisfactory to the Administrative Agent, or if such financial
        statements have not been audited by such an accounting firm, such financial
        statements shall have been approved by the Administrative Agent; 

       

          (d)    for
        any
        Acquired Business with its primary operations outside the United States,
        the
        Total Consideration for such Acquired Business does not exceed $50,000,000
        and,
        when taken together with the Total Consideration for all Acquired Businesses
        with their primary operations outside the United States of America acquired
        from
        the Closing Date, does not exceed in the aggregate $100,000,000;

       

          (e)    the
        Borrowers shall have (i) notified the Administrative Agent and the Lenders
        not
        less than 10 days prior to any such Acquisition and (ii) for each Acquired
        Business the Total Consideration of which exceeds $30,000,000, furnished
        to the
        Administrative Agent and Lenders at such time reasonable details as to such
        Acquisition (including sources and uses of funds therefor), and 3-year
        historical financial information (or such shorter period for which such Acquired
        Business has been in existence) and 1-year pro
        forma
        financial forecasts of the Acquired Business on a stand alone basis as well
        as
        of the Borrower on a consolidated basis after giving effect to the Acquisition
        and covenant compliance calculations reasonably satisfactory to the
        Administrative Agent; 

       

          (f)    if
        a new
        Subsidiary is formed or acquired as a result of or in connection with the
        Acquisition, the Borrower shall have complied with the requirements of
        Section 4 hereof in connection therewith; and

       

          (g)    after
        giving
        effect to the Acquisition, no Default or Event of Default shall exist, including
        with respect to the covenants contained in Sections 8.22 and 8.23, on a
pro
        forma
        basis
        assuming the Acquisition occurred on the first day of the immediately preceding
        12-month period.

       

      “Permitted
        Securitization” means
        an
        accounts receivable securitization program which provides for the transfer
        at no
        less than fair market value of accounts receivable and related rights owed
        to
        the Borrower or any of its Subsidiaries.

       

      “Person”
        means an
        individual, partnership, corporation, limited liability company, association,
        trust, unincorporated organization or any other entity or organization,
        including a government or agency or political subdivision thereof.

       

      “Plan”
        means
        any employee pension benefit plan covered by Title IV of ERISA or subject
        to the minimum funding standards under Section 412 of the Code that either
        (a) is maintained by a member of the Controlled Group for employees of a
        member of the Controlled Group or (b) is maintained pursuant to a
        collective bargaining agreement or any other arrangement under which more
        than
        one employer makes contributions and to which a member of the Controlled
        Group
        is then making or accruing an obligation to make contributions or has within
        the
        preceding five plan years made contributions.

       

      “Property”
        means,
        as to any Person, all types of real, personal, tangible, intangible or mixed
        property owned by such Person whether or not included in the most recent
        balance
        sheet of such Person and its subsidiaries under GAAP.

       

      “Quoted
        Rate”
        is
        defined in Section 1.14(c) hereof.

       

      “RCRA”
        means
        the Solid Waste Disposal Act, as amended by the Resource Conservation and
        Recovery Act of 1976 and Hazardous and Solid Waste Amendments of 1984,
        42 U.S.C. §§6901 et
        seq.,
        and any
        future amendments.

       

      “Register”
        is
        defined in Section 13.12(b) hereof.

       

      “Reimbursement
        Obligation”
        is
        defined in Section 1.2(c) hereof.

       

      “Release”
        means
        any spilling, leaking, pumping, pouring, emitting, emptying, discharging,
        injecting, escaping, leaching, migration, dumping, or disposing into the
        indoor
        or outdoor environment, including, without limitation, the abandonment or
        discarding of barrels, drums, containers, tanks or other receptacles containing
        or previously containing any Hazardous Material.

       

      “Required
        Lenders”
        means,
        as of the date of determination thereof, Lenders whose outstanding Loans
        and
        interests in L/C Obligations and Unused Revolving Credit Commitments constitute
        more than 50% of the sum of the total outstanding Loans, interests in L/C
        Obligations, and Unused Revolving Credit Commitments of the
        Lenders.

       

      “Revolver
        Percentage”
        means,
        for each Lender, the percentage of the Revolving Credit Commitments represented
        by such Lender’s Revolving Credit Commitment or, if the Revolving Credit
        Commitments have been terminated, the percentage held by such Lender (including
        through participation interests in Reimbursement Obligations) of the aggregate
        principal amount of all Revolving Loans and L/C Obligations then
        outstanding.

       

      “Revolving
        Credit”
        means
        the credit facility for making Revolving Loans and issuing Letters of Credit
        described in Sections 1.1 and 1.2 hereof. 

       

      “Revolving
        Credit Commitment”
        means,
        as to any Lender, the obligation of such Lender to make Revolving Loans to
        and
        to participate in Swing Line Loans and Letters of Credit issued for the account
        of the Borrower hereunder in an aggregate principal or face amount at any
        one
        time outstanding not to exceed the amount set forth opposite such Lender’s name
        on Schedule 1 attached hereto and made a part hereof, as the same may be
        reduced or modified at any time or from time to time pursuant to the terms
        hereof. 

       

      “Revolving
        Credit Termination Date”
        means
        June 27, 2011, or such earlier date on which the Revolving Credit Commitments
        are terminated in whole pursuant to Section 1.12, 9.2 or 9.3
        hereof.

       

      “Revolving
        Loan” is
        defined in Section 1.1 hereof and, as so defined, includes a Base Rate Loan
        or a Eurodollar Loan, each of which is a “type”
        of
        Revolving Loan hereunder.

       

      “Revolving
        Note”
        is
        defined in Section 1.10(d) hereof.

       

      “S&P”
        means
        Standard & Poor’s Ratings Services Group, a division of The McGraw-Hill
        Companies, Inc.

       

      “Securitization
        Attributed Indebtedness” means
        the
        amount of obligations outstanding under a Permitted Securitization on any
        date
        of determination that would be characterized as principal if such facility
        were
        structured as a secured lending transaction rather than as a
        purchase.

       

      “SPV”
means
        any Wholly-owned Subsidiary formed solely for the purpose of and that engages
        only in one or more Permitted Securitizations, and activities related
        thereto.

       

      “Subordinated
        Debt”
        means
        Indebtedness for Borrowed Money owing to any Subordinated Noteholder in respect
        of the Subordinated Notes.

       

      “Subordinated
        Indenture”
        means
        that certain Indenture dated as of May 11, 2004 between the Borrower and
        the Subordinated Indenture Trustee, as the same may be amended, supplemented
        or
        modified in accordance with Section 8.21 hereof.

       

      “Subordinated
        Indenture Trustee”
means
        Wells Fargo Bank, N.A., and any successor or assignee thereof as “Trustee” under
        the Subordinated Indenture.

       

      “Subordinated
        Note Documents”
        means
        (i) the Subordinated Notes, (ii) the Subordinated Indenture and
        (iii) any other agreements, documents or instruments executed and/or
        delivered in connection with the Subordinated Notes or the Subordinated
        Indenture in form and substance reasonably acceptable to the Administrative
        Agent, as the same may be amended, supplemented or modified in accordance
        with
        Section 8.21 hereof (including, without limitation, the Registration Rights
        Agreement (as defined in the Subordinated Indenture)).

       

      “Subordinated
        Noteholders”
        means
        collectively, the “Holders”
        (as
        defined in the Subordinated Indenture).

       

      “Subordinated
        Notes”
        means
        those certain 2.125% Convertible Senior Subordinated Notes due 2024 issued
        by
        the Borrower in an original aggregate principal amount of $60,000,000 pursuant
        to the Subordinated Indenture, as the same may be amended, supplemented or
        modified in accordance with Section 8.21 hereof.

       

      “Subsidiary”
        means,
        as to any particular parent corporation or organization, any other corporation
        or organization more than 50% of the outstanding Voting Stock of which is
        at the
        time directly or indirectly owned by such parent corporation or organization
        or
        by any one or more other entities which are themselves subsidiaries of such
        parent corporation or organization. Unless otherwise expressly noted herein,
        the
        term “Subsidiary”
        means a
        Subsidiary of the Borrower or of any of its direct or indirect
        Subsidiaries.

       

      “Swing
        Line” means
        the
        credit facility for making one or more Swing Loans described in
        Section 1.14 hereof.

       

      “Swing
        Line Sublimit”
        means
        $10,000,000, as reduced pursuant to the terms hereof.

       

      “Swing
        Loan” and
        “Swing
        Loans”
        each is
        defined in Section 1.14 hereof.

       

      “Swing
        Note”
        is
        defined in Section 1.10(d) hereof.

       

      “Total
        Consideration”
        means
        the total amount (but without duplication) of (a) cash paid in connection
        with any Acquisition, plus
        (b) indebtedness payable to the seller in connection with such Acquisition,
plus
        (c) the fair market value of any equity securities, including any warrants
        or options therefor, delivered to the seller in connection with any Acquisition,
        plus
        (d) the present value of covenants not to compete entered into in
        connection with such Acquisition or other future payments which are required
        to
        be made over a period of time and are not contingent upon the Borrower or
        its
        Subsidiary meeting financial performance objectives (exclusive of salaries
        paid
        in the ordinary course of business) (discounted at the Base Rate), but only
        to
        the extent not included in clause (a), (b) or (c) above, plus
        (e) the amount of indebtedness assumed in connection with such
        Acquisition.

       

      “Total
        Funded Debt”
        means,
        at any time the same is to be determined, the sum (but without duplication)
        of
        (a) all Indebtedness for Borrowed Money of the Borrower and its
        Subsidiaries at such time, plus
        (b) all
        Indebtedness for Borrowed Money of any other Person which is directly or
        indirectly guaranteed by the Borrower or any of its Subsidiaries or which
        the
        Borrower or any of its Subsidiaries has agreed (contingently or otherwise)
        to
        purchase or otherwise acquire or in respect of which the Borrower or any
        of its
        Subsidiaries has otherwise assured a creditor against loss minus
        (c) all Indebtedness for Borrowed Money of the Borrower in respect of
        letters of credit permitted by Section 8.7(o).

       

      “Unfunded
        Vested Liabilities” means,
        for any Plan at any time, the amount (if any) by which the present value
        of all
        vested nonforfeitable accrued benefits under such Plan exceeds the fair market
        value of all Plan assets allocable to such benefits, all determined as of
        the
        then most recent valuation date for such Plan, but only to the extent that
        such
        excess represents a potential liability of a member of the Controlled Group
        to
        the PBGC or the Plan under Title IV of ERISA.

       

      “Unused
        Revolving Credit Commitments”
        means,
        at any time, the difference between the Revolving Credit Commitments then
        in
        effect and the aggregate outstanding principal amount of Revolving Loans
        and L/C
        Obligations, provided
        that
        Swing Loans outstanding from time to time shall be deemed to reduce the Unused
        Revolving Credit Commitment of the Administrative Agent for purposes of
        computing the commitment fee under Section 2.1(a) hereof.

       

      “U.S.
        Dollars”
        and
“$”
        each
        means the lawful currency of the United States of America.

       

      “Voting
        Stock”
        of any
        Person means capital stock or other equity interests of any class or classes
        (however designated) having ordinary power for the election of directors
        or
        other similar governing body of such Person, other than stock or other equity
        interests having such power only by reason of the happening of a
        contingency.

       

      “Welfare
        Plan”
        means a
“welfare plan” as defined in Section 3(1) of ERISA.

       

      “Wholly-owned
        Subsidiary”
        means a
        Subsidiary of which all of the issued and outstanding shares of capital stock
        (other than directors’ qualifying shares as required by law) or other equity
        interests are owned by the Borrower and/or one or more Wholly-owned Subsidiaries
        within the meaning of this definition.

       

          Section 5.2.    Interpretation.
        The
        foregoing definitions are equally applicable to both the singular and plural
        forms of the terms defined. The words “hereof”,
        “herein”,
        and
“hereunder”
        and
        words
        of like import when used in this Agreement shall refer to this Agreement
        as a
        whole and not to any particular provision of this Agreement. All references
        to
        time of day herein are references to Chicago, Illinois, time unless otherwise
        specifically provided. Where the character or amount of any asset or liability
        or item of income or expense is required to be determined or any consolidation
        or other accounting computation is required to be made for the purposes of
        this
        Agreement, it shall be done in accordance with GAAP except where such principles
        are inconsistent with the specific provisions of this Agreement.

       

          Section 5.3.    Change
        in
        Accounting Principles.
        If,
        after the date of this Agreement, there shall occur any change in GAAP from
        those used in the preparation of the financial statements referred to in
        Section 6.5 hereof and such change shall result in a change in the method
        of calculation of any financial covenant, standard or term found in this
        Agreement, either the Borrower or the Required Lenders may by notice to the
        Lenders and the Borrower, respectively, require that the Lenders and the
        Borrower negotiate in good faith to amend such covenants, standards, and
        term so
        as equitably to reflect such change in accounting principles, with the desired
        result being that the criteria for evaluating the financial condition of
        the
        Borrower and its Subsidiaries shall be the same as if such change had not
        been
        made. No delay by the Borrower or the Required Lenders in requiring such
        negotiation shall limit their right to so require such a negotiation at any
        time
        after such a change in accounting principles. Until any such covenant, standard,
        or term is amended in accordance with this Section 5.3, financial covenants
        shall be computed and determined in accordance with GAAP in effect prior
        to such
        change in accounting principles. Without limiting the generality of the
        foregoing, the Borrower shall neither be deemed to be in compliance with
        any
        financial covenant hereunder nor out of compliance with any financial covenant
        hereunder if such state of compliance or noncompliance, as the case may be,
        would not exist but for the occurrence of a change in accounting principles
        after the date hereof.

       

      
        	
                Section 6.

              	
                Representations
                  and Warranties.

              

      

       

      The
        Borrower represents and warrants to the Administrative Agent and the Lenders
        as
        follows:

       

          Section 6.1.    Organization
        and Qualification.
        The
        Borrower is duly organized, validly existing and in good standing as a
        corporation under the laws of the State of Indiana, has full and adequate
        power
        to own its Property and conduct its business as now conducted, and is duly
        licensed or qualified and in good standing in each jurisdiction in which
        the
        nature of the business conducted by it or the nature of the Property owned
        or
        leased by it requires such licensing or qualifying, except where the failure
        to
        do so would not reasonably be expected to have a Material Adverse
        Effect.

       

          Section 6.2.    Subsidiaries.
        Each
        Subsidiary is duly organized, validly existing and in good standing under
        the
        laws of the jurisdiction in which it is incorporated or organized, as the
        case
        may be, has full and adequate power to own its Property and conduct its business
        as now conducted, and is duly licensed or qualified and in good standing
        in each
        jurisdiction in which the nature of the business conducted by it or the nature
        of the Property owned or leased by it requires such licensing or qualifying,
        except where the failure to do so would not reasonably be expected to have
        a
        Material Adverse Effect. Schedule 6.2 hereto identifies each Subsidiary,
        the jurisdiction of its incorporation or organization, as the case may be,
        the
        percentage of issued and outstanding shares of each class of its capital
        stock
        or other equity interests owned by the Borrower and the other Subsidiaries
        and,
        if such percentage is not 100% (excluding directors’ qualifying shares as
        required by law), a description of each class of its authorized capital stock
        and other equity interests and the number of shares of each class issued
        and
        outstanding. All of the outstanding shares of capital stock and other equity
        interests of each Subsidiary are validly issued and outstanding and fully
        paid
        and nonassessable and all such shares and other equity interests indicated
        on
        Schedule 6.2 as owned by the Borrower or another Subsidiary are owned,
        beneficially and of record, by the Borrower or such Subsidiary free and clear
        of
        all Liens other than Liens not prohibited by Section 8.8(a). There are no
        outstanding commitments or other obligations of any Subsidiary to issue,
        and no
        options, warrants or other rights of any Person to acquire, any shares of
        any
        class of capital stock or other equity interests of any Subsidiary.

       

          Section 6.3.    Authority
        and
        Validity of Obligations.
        The
        Borrower has full right and authority to enter into this Agreement and the
        other
        Loan Documents executed by it, to make the borrowings herein provided for,
        to
        issue its Notes in evidence thereof, and to perform all of its obligations
        hereunder and under the other Loan Documents executed by it. Each Subsidiary
        has
        full right and authority to enter into the Loan Documents executed by it,
        to
        guarantee the Obligations, Hedging Liability, and Funds Transfer and Deposit
        Account Liability, and to perform all of its obligations under the Loan
        Documents executed by it. The Loan Documents delivered by the Borrower and
        by
        each Subsidiary have been duly authorized, executed, and delivered by such
        Person and constitute valid and binding obligations of such Person enforceable
        against it in accordance with their terms, except as enforceability may be
        limited by bankruptcy, insolvency, fraudulent conveyance or similar laws
        affecting creditors’ rights generally and general principles of equity
        (regardless of whether the application of such principles is considered in
        a
        proceeding in equity or at law); and this Agreement and the other Loan Documents
        do not, nor does the performance or observance by the Borrower or any Subsidiary
        of any of the matters and things herein or therein provided for,
        (a) contravene or constitute a default under any provision of law or any
        judgment, injunction, order or decree binding upon the Borrower or any
        Subsidiary or any provision of the organizational documents (e.g., charter,
        articles of incorporation or by-laws, articles of association or operating
        agreement, partnership agreement or other similar document) of the Borrower
        or
        any Subsidiary, (b) contravene or constitute a default under any covenant,
        indenture or agreement of or affecting the Borrower or any Subsidiary or
        any of
        its Property, in each case where such contravention or default, individually
        or
        in the aggregate, could reasonably be expected to have a Material Adverse
        Effect
        or (c) result in the creation or imposition of any Lien on any Property of
        the Borrower or any Subsidiary.

       

          Section 6.4.    Use
        of Proceeds; Margin Stock.
        The
        Borrower shall use the proceeds of the Revolving Credit for its general working
        capital purposes and for such other legal and proper purposes as are consistent
        with all applicable laws. Neither the Borrower nor any Subsidiary is engaged
        in
        the business of extending credit for the purpose of purchasing or carrying
        margin stock (within the meaning of Regulation U of the Board of Governors
        of the Federal Reserve System), and no part of the proceeds of any Loan or
        any
        other extension of credit made hereunder will be used to purchase or carry
        any
        such margin stock or to extend credit to others for the purpose of purchasing
        or
        carrying any such margin stock. Margin stock (as hereinabove defined)
        constitutes less than 25% of the assets of the Borrower and its Subsidiaries
        which are subject to any limitation on sale, pledge or other restriction
        hereunder.

       

          Section 6.5.    Financial
        Reports.
        The
        consolidated balance sheet of the Borrower and its Subsidiaries as at
        December 31, 2005, and the related consolidated statements of income,
        retained earnings and cash flows of the Borrower and its Subsidiaries for
        the
        fiscal year then ended, and accompanying notes thereto, which financial
        statements are accompanied by the audit report of Grant Thornton LLP,
        independent public accountants, and the unaudited interim consolidated balance
        sheet of the Borrower and its Subsidiaries as at April 2, 2006, and the
        related consolidated statements of income, retained earnings and cash flows
        of
        the Borrower and its Subsidiaries for the three (3) months then ended,
        heretofore furnished to the Administrative Agent and the Lenders, fairly
        present
        in all material respects the consolidated financial condition of the Borrower
        and its Subsidiaries as at said dates and the consolidated results of their
        operations and cash flows for the periods then ended in conformity with GAAP
        applied on a consistent basis. Neither the Borrower nor any Subsidiary has
        contingent liabilities which are material to it other than as indicated on
        such
        financial statements or, with respect to future periods, on the financial
        statements furnished pursuant to Section 8.5 hereof.

       

          Section 6.6.    No
        Material Adverse Change. Since
        December 31, 2005, there has been no change in the financial condition of
        the Borrower or any Subsidiary except those occurring in the ordinary course
        of
        business, none of which individually or in the aggregate have been materially
        adverse. 

       

          Section 6.7.    Full
        Disclosure.
        The
        statements and information furnished to the Administrative Agent and the
        Lenders
        in connection with the negotiation of this Agreement and the other Loan
        Documents and the commitments by the Lenders to provide all or part of the
        financing contemplated hereby taken as a whole do not contain any untrue
        statements of a material fact or omit a material fact necessary to make the
        material statements contained herein or therein not misleading, the
        Administrative Agent and the Lenders acknowledging that as to any projections
        furnished to the Administrative Agent and the Lenders, the Borrower only
        represents that the same were prepared on the basis of information and estimates
        the Borrower believed to be reasonable.

       

          Section 6.8.    Trademarks,
        Franchises, and Licenses.
        The
        Borrower and its Subsidiaries own, possess, or have the right to use all
        necessary patents, licenses, franchises, trademarks, trade names, trade styles,
        copyrights, trade secrets, know how, and confidential commercial and proprietary
        information to conduct their businesses as now conducted, without known conflict
        with any patent, license, franchise, trademark, trade name, trade style,
        copyright or other proprietary right of any other Person.

       

          Section 6.9.    Governmental
        Authority and Licensing.
        The
        Borrower and its Subsidiaries have received all licenses, permits, and approvals
        of all federal, state, and local governmental authorities, if any, necessary
        to
        conduct their businesses, in each case where the failure to obtain or maintain
        the same could reasonably be expected to have a Material Adverse Effect.
        No
        investigation or proceeding which, if adversely determined, could reasonably
        be
        expected to result in revocation or denial of any material license, permit
        or
        approval is pending or, to the Knowledge of the Borrower,
        threatened.

       

          Section 6.10.    Good
        Title.
        The
        Borrower and its Subsidiaries have good and defensible title to (or valid
        leasehold interests in ) their assets as reflected on the most recent
        consolidated balance sheet of the Borrower and its Subsidiaries furnished
        to the
        Administrative Agent and the Lenders (except for assets sold in the ordinary
        course of business or pursuant to Dispositions permitted hereunder), subject
        to
        no Liens other than such thereof as are permitted by Section 8.8
        hereof.

       

          Section 6.11.    Litigation
        and Other Controversies.
        There is
        no litigation or governmental or arbitration proceeding or labor controversy
        pending, nor to the Knowledge of the Borrower threatened, against the Borrower
        or any Subsidiary which individually or in the aggregate, could reasonably
        be
        expected to have a Material Adverse Effect.

       

          Section 6.12.    Taxes.
        All
        income and other material tax returns required to be filed by the Borrower
        or
        any Subsidiary in any jurisdiction have, in fact, been filed, and all material
        taxes, assessments, fees, and other governmental charges upon the Borrower
        or
        any Subsidiary or upon any of its Property, income or franchises, which are
        shown to be due and payable in such returns, have been paid, except such
        taxes,
        assessments, fees and governmental charges, if any, as are being contested
        in
        good faith and by appropriate proceedings which prevent enforcement of the
        matter under contest and as to which adequate reserves established in accordance
        with GAAP have been provided. The Borrower does not know of any proposed
        additional tax assessment against it or its Subsidiaries for which adequate
        provisions in accordance with GAAP have not been made on their accounts.
        Adequate provisions in accordance with GAAP for taxes on the books of the
        Borrower and each Subsidiary have been made for all open years, and for its
        current fiscal period.

       

          Section 6.13.    Approvals.
        No
        authorization, consent, license or exemption from, or filing or registration
        with, any court or governmental department, agency or instrumentality, nor
        any
        approval or consent of any other Person, is or will be necessary to the valid
        execution, delivery or performance by the Borrower or any Subsidiary of any
        Loan
        Document, except for such approvals which have been obtained prior to the
        date
        of this Agreement and remain in full force and effect.

       

          Section 6.14.    Affiliate
        Transactions.
        Neither
        the Borrower nor any Subsidiary is a party to any contracts or agreements
        with
        any of its Affiliates (other than with Wholly-owned Subsidiaries) on terms
        and
        conditions which are less favorable to the Borrower or such Subsidiary than
        would be usual and customary in similar contracts or agreements between Persons
        not affiliated with each other.

       

          Section 6.15.    Investment
        Company.
        Neither
        the Borrower nor any Subsidiary is an “investment company” or a company
“controlled” by an “investment company” within the meaning of the Investment
        Company Act of 1940, as amended.

       

          Section 6.16.    ERISA.
        The
        Borrower and each other member of its Controlled Group has fulfilled its
        obligations under the minimum funding standards of and is in compliance in
        all
        material respects with ERISA and the Code to the extent applicable to it
        and has
        not incurred any liability to the PBGC or a Plan under Title IV of ERISA
        other than a liability to the PBGC for premiums under Section 4007 of
        ERISA. Neither the Borrower nor any Subsidiary has any contingent liabilities
        with respect to any post-retirement benefits under a Welfare Plan, other
        than
        liability for continuation coverage described in article 6 of Title I
        of ERISA.

       

          Section 6.17.    Compliance
        with Laws.
        (a) The Borrower and its Subsidiaries are in compliance with the
        requirements of all federal, state and local laws, rules and regulations
        applicable to or pertaining to their Property or business operations (including,
        without limitation, the Occupational Safety and Health Act of 1970, the
        Americans with Disabilities Act of 1990, and laws and regulations establishing
        quality criteria and standards for air, water, land and toxic or hazardous
        wastes and substances), where any non-compliance with any such requirements,
        individually or in the aggregate, could reasonably be expected to have a
        Material Adverse Effect. 

       

          (b)    Without
        limiting the representations and warranties set forth in Section 6.17(a)
        above, except for such matters, individually or in the aggregate, which could
        not reasonably be expected to result in a Material Adverse Effect, the Borrower
        represents and warrants that: (i) the Borrower and its Subsidiaries, and
        each of the Premises, comply in all material respects with all applicable
        Environmental Laws; (ii) the Borrower and its Subsidiaries have obtained
        all governmental approvals required for their operations and each of the
        Premises by any applicable Environmental Law; (iii) the Borrower and its
        Subsidiaries have not, and the Borrower has no Knowledge of any other Person
        who
        has, caused any Release, threatened Release or disposal of any Hazardous
        Material at, on, about, or off any of the Premises in any material quantity
        and,
        to the Knowledge of the Borrower, none of the Premises are adversely affected
        by
        any Release, threatened Release or disposal of a Hazardous Material originating
        or emanating from any other property; (iv) none of the Premises contain and
        have contained any: (1) underground storage tank, (2) material amounts
        of asbestos containing building material, (3) landfills or dumps,
        (4) hazardous waste management facility as defined pursuant to RCRA or any
        comparable state law, or (5) site on or nominated for the National Priority
        List promulgated pursuant to CERCLA or any state remedial priority list
        promulgated or published pursuant to any comparable state law; (v) the
        Borrower and its Subsidiaries have not used a material quantity of any Hazardous
        Material and have conducted no Hazardous Material Activity at any of the
        Premises; (vi) the Borrower and its Subsidiaries have no material liability
        for response or corrective action, natural resource damage or other harm
        pursuant to CERCLA, RCRA or any comparable state law; (vii) the Borrower
        and its Subsidiaries are not subject to, have no notice or Knowledge of and
        are
        not required to give any notice of any Environmental Claim involving the
        Borrower or any Subsidiary or any of the Premises, and there are no conditions
        or occurrences at any of the Premises which could reasonably be anticipated
        to
        form the basis for an Environmental Claim against the Borrower or any Subsidiary
        or such Premises; (viii) none of the Premises are subject to any, and the
        Borrower has no Knowledge of any imminent, restriction on the ownership,
        occupancy, use or transferability of the Premises in connection with any
        (1) Environmental Law or (2) Release, threatened Release or disposal
        of a Hazardous Material; and (ix) there are no conditions or circumstances
        at any of the Premises which pose an unreasonable risk to the environment
        or the
        health or safety of Persons.

       

          Section 6.18.    Other
        Agreements.
        Neither
        the Borrower nor any Subsidiary is in default under the terms of any covenant,
        indenture or agreement of or affecting such Person or any of its Property,
        which
        default if uncured could reasonably be expected to have a Material Adverse
        Effect.

       

          Section
        6.19.    Solvency.
        The
        Borrower and its Subsidiaries are solvent, able to pay their debts as they
        become due, and have sufficient capital to carry on their business and all
        businesses in which they are about to engage.

       

          Section 6.20.    No
        Default.
No
        Default or Event of Default has occurred and is continuing.

       

          Section 6.21.    Subordinated
        Indebtedness.
        The
        subordination provisions of the Subordinated Note Documents and each of the
        Subordinated Notes are enforceable against the Subordinated Noteholders and
        the
        Obligations constitute “Senior Debt” (or an appropriate equivalent term) under
        and as defined in the Subordinated Note Documents and each of the Subordinated
        Notes.

       

      
        	
                Section 7.

              	
                Conditions
                  Precedent.

              

      

       

      The
        obligation of each Lender to advance, continue or convert any Loan (other
        than
        the continuation of, or conversion into, a Base Rate Loan) or of the L/C
        Issuer
        to issue, extend the expiration date (including by not giving notice of
        non-renewal) of or increase the amount of any Letter of Credit under this
        Agreement, shall be subject to the following conditions precedent:

       

          Section 7.1.    All
        Credit
        Events.
        At the
        time of each Credit Event hereunder:

       

      (a)    each
        of
        the representations and warranties set forth herein and in the other Loan
        Documents shall be and remain true and correct as of said time, except to
        the
        extent the same expressly relate to an earlier date;

       

      (b)    the
        Borrower
        and each Subsidiary shall be in compliance in all material respects with
        all of
        the terms and conditions hereof and of the other Loan Documents, and no Default
        or Event of Default shall have occurred and be continuing or would occur
        as a
        result of such Credit Event; and

       

      (c)     in
        the
        case of a Borrowing the Administrative Agent shall have received the notice
        required by Section 1.5 hereof, in the case of the issuance of any Letter
        of Credit, the L/C Issuer shall have received a duly completed Application
        for such Letter of Credit together with any fees called for by Section 2.1
        hereof, and, in the case of an extension or increase in the amount of a Letter
        of Credit, a written request therefor in a form reasonably acceptable to
        the
        L/C Issuer together with fees called for by Section 2.1
        hereof.

       

      Each
        request for a Borrowing hereunder and each request for the issuance of, increase
        in the amount of, or extension of the expiration date of, a Letter of Credit
        shall be deemed to be a representation and warranty by the Borrower on the
        date
        on such Credit Event as to the facts specified in subsections (a) through
        (c), both inclusive, of this Section.

       

          Section
        7.2.    Initial
        Credit Event.
        Before
        or concurrently with the initial Credit Event:

       

          (a)    the
        Administrative Agent shall have received (i) for each Lender this Agreement
        duly
        executed by the Borrower, Guarantors, and the Lenders and (ii) for each Lender
        that has requested a Note, such Lender’s duly executed Note;

       

          (b)    the
        Administrative Agent shall have received for each Lender copies of the
        Borrower’s and each Guarantor’s articles of incorporation and bylaws (or
        comparable organizational documents) and any amendments thereto, certified
        in
        each instance by its Secretary or Assistant Secretary;

       

          (c)    the
        Administrative Agent shall have received for each Lender copies of resolutions
        of the Borrower’s and each Guarantor’s Board of Directors (or similar governing
        body) authorizing the execution, delivery and performance of this Agreement
        and
        the other Loan Documents to which it is a party and the consummation of the
        transactions contemplated hereby and thereby, together with specimen signatures
        of the persons authorized to execute such documents on the Borrower’s and each
        Guarantor’s behalf, all certified in each instance by its Secretary or Assistant
        Secretary;

       

          (d)    the
        Administrative Agent shall have received for each Lender copies of the
        certificates of good standing for the Borrower and each Guarantor (dated
        no
        earlier than 20 days prior to the date hereof) from the office of the secretary
        of the state of its incorporation or organization and of each state in which
        it
        is qualified to do business as a foreign corporation or
        organization;

       

          (e)    the
        Administrative Agent shall have received for each Lender a list of the
        Borrower’s Authorized Representatives;

       

          (f)    the
        Administrative Agent shall have received for itself and for the Lenders the
        initial fees called for by Section 2.1 hereof;

       

          (g)    the
        Administrative Agent shall have received pay-off and lien release letters
        from
        secured creditors of the Borrower and each Subsidiary that is not a Foreign
        Subsidiary (other than any secured creditors that hold indebtedness permitted
        under Section 8.7) setting forth, among other things, the total amount of
        indebtedness outstanding and owing to them (or outstanding letters of credit
        issued for the account of the Borrower or any Subsidiary) and containing
        an
        undertaking to cause to be delivered to the Administrative Agent UCC termination
        statements and any other lien release instruments necessary to release their
        Liens on the assets of the Borrower and each such Subsidiary, which pay-off
        and
        lien release letters shall be in form and substance reasonably acceptable
        to the
        Administrative Agent;

       

          (h)    the
        Administrative Agent shall have received for each Lender the favorable written
        opinion of counsel to the Borrower and each Guarantor, in form and substance
        reasonably satisfactory to the Administrative Agent; and 

       

          (i)    the
        Administrative Agent shall have received for the account of the Lenders such
        other agreements, instruments, documents, certificates, and opinions as the
        Administrative Agent may reasonably request.

       

      
        	
                Section 8.

              	
                Covenants.

              

      

       

      The
        Borrower agrees that, so long as any credit is available to or in use by
        the
        Borrower hereunder, except to the extent compliance in any case or cases
        is
        waived in writing pursuant to the terms of Section 13.13
        hereof:

       

          Section 8.1.    Maintenance
        of Business.
        The
        Borrower shall, and shall cause each Subsidiary to, preserve and maintain
        its
        existence, except as otherwise provided in Section 8.10(e) hereof. The
        Borrower shall, and shall cause each Subsidiary to, preserve and keep in
        force
        and effect all licenses, permits, franchises, approvals, patents, trademarks,
        trade names, trade styles, copyrights, and other proprietary rights necessary
        to
        the proper conduct of its business where the failure to do so could reasonably
        be expected to have a Material Adverse Effect.

       

          Section 8.2.    Maintenance
        of Properties.
        The
        Borrower shall, and shall cause each Subsidiary to, maintain, preserve, and
        keep
        its material property, plant, and equipment in good repair, working order
        and
        condition (ordinary wear and tear excepted), and shall from time to time
        make
        all needful and proper repairs, renewals, replacements, additions, and
        betterments thereto so that at all times the efficiency thereof shall be
        fully
        preserved and maintained, except to the extent that, in the reasonable business
        judgment of such Person, any such Property is no longer necessary for the
        proper
        conduct of the business of such Person.

       

          Section 8.3.    Taxes
        and
        Assessments.
        The
        Borrower shall duly pay and discharge, and shall cause each Subsidiary to
        duly
        pay and discharge, all taxes, rates, assessments, fees, and governmental
        charges
        upon or against it or its Property, in each case before the same become
        delinquent and before penalties accrue thereon, unless and to the extent
        that
        the same (i) could not reasonably be expected, individually or in the aggregate,
        to have a Material Adverse Effect or (ii) are being contested in good faith
        and
        by appropriate proceedings which prevent enforcement of the matter under
        contest
        and adequate reserves are provided therefor.

       

          Section 8.4.    Insurance.
        The
        Borrower shall insure and keep insured, and shall cause each Subsidiary to
        insure and keep insured, with good and responsible insurance companies, all
        insurable Property owned by it which is of a character usually insured by
        Persons similarly situated and operating like Properties against loss or
        damage
        from such hazards and risks, and in such amounts, as are insured by Persons
        similarly situated and operating like Properties; and the Borrower shall
        insure,
        and shall cause each Subsidiary to insure, such other hazards and risks
        (including, without limitation, employers’ and public liability risks) with good
        and responsible insurance companies as and to the extent usually insured
        by
        Persons similarly situated and conducting similar businesses. The Borrower
        shall, upon the request of the Administrative Agent, furnish to the
        Administrative Agent and the Lenders a certificate setting forth in summary
        form
        the nature and extent of the insurance maintained pursuant to this
        Section.

       

          Section 8.5.    Financial
        Reports.
        The
        Borrower shall, and shall cause each Subsidiary to, maintain a standard system
        of accounting in accordance with GAAP and shall furnish to the Administrative
        Agent, each Lender and each of their duly authorized representatives such
        information respecting the business and financial condition of the Borrower
        and
        each Subsidiary as the Administrative Agent or such Lender may reasonably
        request; and without any request, shall furnish to the Administrative Agent
        and
        the Lenders:

       

          (a)    as
        soon
        as available, and in any event within 45 days after the close of each of
        the first three fiscal quarters of each fiscal year of the Borrower, a copy
        of
        the consolidated balance sheet of the Borrower and its Subsidiaries as of
        the
        last day of such fiscal quarter and the consolidated statements of income,
        retained earnings, and cash flows of the Borrower and its Subsidiaries for
        the
        fiscal quarter and for the fiscal year-to-date period then ended, each in
        reasonable detail showing in comparative form the figures for the corresponding
        date and period in the previous fiscal year, prepared by the Borrower in
        accordance with GAAP (subject to the absence of footnote disclosures and
        year-end audit adjustments) and certified to by its chief financial officer
        or
        another officer of the Borrower reasonably acceptable to the Administrative
        Agent;

       

          (b)    as
        soon as
        available, and in any event within 90 days after the close of each fiscal
        year of the Borrower, a copy of the consolidated balance sheet of the Borrower
        and its Subsidiaries as of the last day of the fiscal year then ended and
        the
        consolidated statements of income, retained earnings, and cash flows of the
        Borrower and its Subsidiaries for the fiscal year then ended, and accompanying
        notes thereto, each in reasonable detail showing in comparative form the
        figures
        for the previous fiscal year, accompanied in the case of the consolidated
        financial statements by an unqualified opinion of Grant Thornton LLP or another
        firm of independent public accountants of recognized national standing, selected
        by the Borrower and reasonably satisfactory to the Administrative Agent,
        to the
        effect that the consolidated financial statements have been prepared in
        accordance with GAAP and present fairly in accordance with GAAP the consolidated
        financial condition of the Borrower and its Subsidiaries as of the close
        of such
        fiscal year and the results of their operations and cash flows for the fiscal
        year then ended and that an examination of such accounts in connection with
        such
        financial statements has been made in accordance with generally accepted
        auditing standards and, accordingly, such examination included such tests
        of the
        accounting records and such other auditing procedures as were considered
        necessary in the circumstances; provided
        that
        such opinion may be limited in form, scope and substance to the extent required
        by applicable accounting rules or guidelines as in effect from time to
        time.

       

          (c)    within
        the
        period provided in subsection (b) above, the written statement of the
        accountants who certified the audit report thereby required that in the course
        of their audit they have obtained no knowledge of any Default or Event of
        Default, or, if such accountants have obtained knowledge of any such Default
        or
        Event of Default, they shall disclose in such statement the nature and period
        of
        the existence thereof; provided
        that
        such written statement may be limited in form, scope and substance to the
        extent
        required by applicable accounting rules or guidelines as in effect from time
        to
        time;

       

          (d)    promptly
        after receipt thereof, any additional final written reports, management letters
        or other detailed information contained in writing concerning significant
        aspects of the Borrower’s or any Subsidiary’s operations and financial affairs
        given to it by its independent public accountants;

       

          (e)    promptly
        after the sending or filing thereof, copies of each financial statement,
        report,
        notice or proxy statement sent by the Borrower or any Subsidiary to its
        stockholders or other equity holders, and copies of each regular, periodic
        or
        special report, registration statement or prospectus (including all Form
        10-K,
        Form 10-Q and Form 8-K reports) filed by the Borrower or any Subsidiary with
        any
        securities exchange or the Securities and Exchange Commission or any successor
        agency;

       

          (f)    promptly
        after receipt thereof, a copy of each final audit made by any regulatory
        agency
        of the books and records of the Borrower or any Subsidiary or of notice of
        any
        material noncompliance with any applicable law, regulation or guideline relating
        to the Borrower or any Subsidiary, or its business; 

       

          (g)    as
        soon as
        available, and in any event within 60 days after the beginning of each
        fiscal year of the Borrower, a copy of the Borrower’s consolidated business plan
        for such fiscal year, such business plan to show the Borrower’s projected
        consolidated revenues, expenses and balance sheet on a
        quarter-by-quarter/month-by-month basis, such business plan to be in reasonable
        detail prepared by the Borrower and in form reasonably satisfactory to the
        Administrative Agent (which shall include a summary of all assumptions made
        in
        preparing such business plan); 

       

          (h)    notice
        of
        any Change in Control; 

       

          (i)    promptly
        after Knowledge thereof shall have come to the attention of any Authorized
        Officer of the Borrower, written notice of any threatened or pending litigation
        or governmental or arbitration proceeding or labor controversy against the
        Borrower or any Subsidiary which, if adversely determined, could reasonably
        be
        expected to have a Material Adverse Effect or of the occurrence of any Default
        or Event of Default hereunder; and

       

          (j)    with
        each of
        the financial statements furnished to the Lenders pursuant to
        subsections (a) and (b) above, a written certificate in the form attached
        hereto as Exhibit F signed by the chief financial officer of the Borrower
        or another officer of the Borrower reasonably acceptable to the Administrative
        Agent to the effect that to the best of such officer’s Knowledge and belief no
        Default or Event of Default has occurred during the period covered by such
        statements or, if any such Default or Event of Default has occurred during
        such
        period, setting forth a description of such Default or Event of Default and
        specifying the action, if any, taken by the Borrower or any Subsidiary to
        remedy
        the same. Such certificate shall also set forth the calculations supporting
        such
        statements in respect of Sections 8.22 and 8.23 hereof.

       

          Section 8.6.    Inspection.
        The
        Borrower shall, and shall cause each Subsidiary to, permit the Administrative
        Agent, each Lender, and each of their duly authorized representatives and
        agents
        to visit and inspect any of its Property, corporate books, and financial
        records, to examine and make copies of its books of accounts and other financial
        records, and to discuss its affairs, finances, and accounts with, and to
        be
        advised as to the same by, its officers, employees and independent public
        accountants (and by this provision the Borrower hereby authorizes such
        accountants to discuss with the Administrative Agent and such Lenders the
        finances and affairs of the Borrower and its Subsidiaries) at such reasonable
        times and intervals as the Administrative Agent or any such Lender may designate
        and, prior to the occurrence and during the continuance of an Event of Default,
        in the presence of a designated representative of the Borrower or such
        Subsidiary if requested by the Borrower or such Subsidiary and at the expense
        of
        the Administrative Agent or the Lenders, as applicable.

       

          Section 8.7.    Borrowings
        and Guaranties. The
        Borrower shall not, nor shall it permit any Subsidiary to, issue, incur,
        assume,
        create or have outstanding any Indebtedness for Borrowed Money, or be or
        become
        liable as endorser, guarantor, surety or otherwise for any debt, obligation
        or
        undertaking of any other Person, or otherwise agree to provide funds for
        payment
        of the obligations of another, or otherwise assure a creditor of another
        against
        loss, or apply for or become liable to the issuer of a letter of credit which
        supports an obligation of another, or subordinate any claim or demand it
        may
        have to the claim or demand of any other Person if to do so would, in any
        case,
        cause the Borrower to violate the financial covenants set forth in Sections
        8.22
        or 8.23; in addition:

       

          (a)    purchase
        money indebtedness and Capitalized Lease Obligations of the Borrower and
        its
        Subsidiaries shall not exceed in the aggregate outstanding at any time 10%
        of
        the book value of the assets of the Borrower and its Subsidiaries as shown
        on
        the Borrower’s balance sheet as of the end of the immediately preceding fiscal
        year;

       

          (b)    indebtedness
        from time to time owing by the Foreign Subsidiaries, taken as a whole, to
        the
        Borrower or any Guarantor shall not exceed in aggregate principal amount
        at any
        time outstanding 10% of the book value of the assets of the Borrower and
        its
        Subsidiaries as shown on the Borrower’s balance sheet as of the end of the
        immediately preceding fiscal year; and

       

          (c)    Securitization
        Attributed Indebtedness shall not exceed $25,000,000 in aggregate principal
        amount outstanding at any time;

       

      provided,
        however, that
        the
        foregoing limitations shall not apply to or operate to prevent the incurrence
        of
        the indebtedness described in Schedule 8.7 hereto (including amounts available
        to be drawn under the facilities described on such Schedule), and any
        extensions, renewal, refunding or replacement of such indebtedness; provided
        that
        any
        such extension, renewal, refunding or replacement is in an aggregate principal
        amount not greater than the principal amount of such indebtedness so extended,
        renewed, refunded or replaced.

       

          Section 8.8.    Liens.
        The
        Borrower shall not, nor shall it permit any Subsidiary to, create, incur
        or
        permit to exist any Lien of any kind on any Property owned by any such Person;
        provided,
        however,
        that the
        foregoing shall not apply to nor operate to prevent:

       

          (a)    Liens
        arising by statute in connection with worker’s compensation, unemployment
        insurance, old age benefits, social security obligations, taxes, assessments,
        statutory obligations or other similar charges (other than material Liens
        arising under ERISA), good faith cash deposits in connection with tenders,
        contracts or leases to which the Borrower or any Subsidiary is a party or
        other
        cash deposits required to be made in the ordinary course of business, provided
        in each case that the obligation is not for borrowed money and adequate reserves
        have been established therefor;

       

          (b)    mechanics’,
        workmen’s, materialmen’s, landlords’, carriers’ or other similar Liens arising
        in the ordinary course of business with respect to obligations which are
        not
        overdue for longer than 60 days or which are being contested in good faith
        by appropriate proceedings which prevent enforcement of the matter under
        contest;

       

          (c)    judgment
        liens and judicial attachment liens not constituting an Event of Default
        under
        Section 9.1(g) hereof and the pledge of assets for the purpose of securing
        an appeal, stay or discharge in the course of any legal proceeding, provided
        that the aggregate amount of such judgment liens and attachments and liabilities
        of the Borrower and its Subsidiaries secured by a pledge of assets permitted
        under this subsection, including interest and penalties thereon, if any,
        shall
        not be in excess of $10,000,000 at any one time outstanding;

       

          (d)    Liens
        on
        Property of the Borrower or any Subsidiary created solely for the purpose
        of
        securing indebtedness permitted by Section 8.7(a) hereof, representing or
        incurred to finance the purchase price of Property, provided
        that no
        such Lien shall extend to or cover other Property of the Borrower or such
        Subsidiary other than the respective Property so acquired, and the principal
        amount of indebtedness secured by any such Lien shall at no time exceed the
        purchase price of such Property, as reduced by repayments of principal
        thereon;

       

          (e)    any
        interest or title of a lessor under any operating lease;

       

          (f)    easements,
        rights-of-way, restrictions, licenses and covenants and other similar
        encumbrances against real property which, in the aggregate, are not substantial
        in amount and which do not materially detract from the value of the Property
        subject thereto or materially interfere with the ordinary conduct of the
        business of the Borrower or any Subsidiary; 

       

          (g)    Liens
        described in Schedule 8.8 hereto and extensions, renewals, refunding and
        replacements thereof; provided
        that
        any
        such extension, renewal, refunding or replacement Lien shall be limited to
        the
        Property covered by the Lien extended, renewed, refunded or replaced and
        that
        the obligations secured by any such extension, renewal, refunding or replacement
        shall be in amount not greater than the amount of the obligations then secured
        by the Lien extended, renewed, refunded or replaced;

       

          (h)    any
        Lien
        in connection with a Permitted Acquisition on or affecting any Property (other
        than capital stock) acquired by the Borrower or a Subsidiary or Property
        (other
        than capital stock) of any acquired Subsidiary after the date of this Agreement;
        provided
        that (i)
        such Lien is created prior to the date on which such Person becomes a Subsidiary
        or such Property is acquired by the Borrower or such Subsidiary, (ii) the
        Lien
        was not created in contemplation of the Acquisition, and (iii) such Lien
        secures
        Indebtedness permitted hereunder and the principal amount thereof has not
        increased in contemplation of or since such Acquisition; 

       

          (i)    Liens
        representing the interest of any transferee of the Borrower’s or its
        Subsidiaries’ accounts receivable and related rights in connection with a
        Permitted Securitization; and

       

          (j)    Liens
        not
        otherwise permitted under this Section 8.8 on Property (other than (i)
        shares of stock in any Subsidiary and (ii) receivables, inventory and similar
        working capital assets) securing Indebtedness for Borrowed Money that is
        in an
        aggregate principal amount at any time not exceeding 10% of the book value
        of
        the assets of the Borrower and its Subsidiaries as shown on the Borrower’s
        balance sheet as of the end of the immediately preceding fiscal
        year.

       

          Section 8.9.    Investments,
        Acquisitions, Loans and Advances.
        The
        Borrower shall not, nor shall it permit any Subsidiary to, directly or
        indirectly, make, retain or have outstanding any investments (whether through
        purchase of stock or obligations or otherwise) in, or loans or advances to,
        any
        other Person, or acquire all or any substantial part of the assets or business
        of any other Person or division thereof; provided,
        however,
        that the
        foregoing limitation shall not apply to nor operate to prevent:

       

          (a)    investments
        in direct obligations of the United States of America or of any agency or
        instrumentality thereof whose obligations constitute full faith and credit
        obligations of the United States of America, provided that any such obligations
        shall mature within one year of the date of issuance thereof;

       

          (b)    investments
        in commercial paper rated at least P-2 by Moody’s and at least A-2 by S&P
        maturing within one year of the date of issuance thereof;

       

          (c)    investments
        in certificates of deposit issued by any Lender or by any United States
        commercial bank having capital and surplus of not less than $100,000,000
        which
        have a maturity of one year or less; 

       

          (d)    investments
        in repurchase obligations with a term of not more than 7 days for
        underlying securities of the types described in subsection (a) above
        entered into with any bank meeting the qualifications specified in
        subsection (c) above, provided all such agreements require physical
        delivery of the securities securing such repurchase agreement, except those
        delivered through the Federal Reserve Book Entry System;

       

          (e)    investments
        in money market funds that are rated “AA” or higher by S&P;

       

          (f)    each
        of the
        Borrower’s and its Subsidiaries’ investments existing on the date of this
        Agreement in its respective Subsidiaries;

       

          (g)    intercompany
        advances made from time to time by the Borrower and/or any Guarantor to any
        one
        or more Guarantors or by a Guarantor to the Borrower, in each case in the
        ordinary course of business to finance working capital needs; 

       

          (h)    intercompany
        advances from time to time by a Foreign Subsidiary to the Borrower or one
        or
        more Subsidiaries, in each case in the ordinary course of business to finance
        working capital needs;

       

          (i)    intercompany
        advances from time to time by the Borrower or any Guarantor to any one or
        more
        Foreign Subsidiaries not to exceed 10% of the book value of the assets of
        the
        Borrower and its Subsidiaries as shown on the Borrower’s balance sheet as of the
        end of the immediately preceding fiscal year in aggregate principal amount
        outstanding for all such advances at any one time, in each case in the ordinary
        course of business to finance working capital needs;

       

          (j)    Permitted
        Acquisitions; 

       

          (k)    investments
        described in Schedule 8.9 hereto;

       

          (l)    investments
        in stock, obligations or securities received in settlement of debts (created
        in
        the ordinary course of business) owing to the Borrower or any
        Subsidiary;

       

          (m)    investments
        in preferred stock or corporate bonds of domestic corporations all of whose
        senior debt bears a rating of at least “A” by S&P or Moody’s;

       

          (n)    investments
        in securities received as consideration in a sale of Property permitted by
        Section 8.10;

       

          (o)    investments
        in the form of advances to employees in the ordinary course of business for
        moving, relocation and travel expenses and other loans to employees for any
        lawful purpose not to exceed $3,000,000 in the aggregate at any one time
        outstanding;

       

          (p)    investments
        in Subsidiaries in connection with transactions permitted under
        Section 8.10(c);

       

          (q)    investments
        in CTS Electronics Zhong Shan, Ltd., a Peoples’ Republic of China company, in an
        aggregate amount not to exceed $10,000,000; 

       

          (r)    with
        respect
        to any Foreign Subsidiary, investments in (i) certificates of deposits, time
        deposits and interest bearing demand deposits issued by any Lender or any
        commercial bank of recognized standing chartered in the country where such
        Foreign Subsidiary is domiciled having capital and surplus of not less than
        $100,000,000 (or its equivalent) which have a maturity of one year or less
        and
        (ii) direct obligations of the national government of the country where such
        Foreign Subsidiary is chartered provided
        that such
        sovereign debt has either a (A) short-term sovereign currency rating of A-1
        or
        higher by S&P or (B) long-term debt rating of AA or higher by S&P, in an
        amount not to exceed $50,000,000 in the aggregate at any one time outstanding
        with respect to this clause (B); 

       

          (s)    investment
        of any acquired Subsidiary,
        provided that
        the
        investments are made prior to the date on which such Person becomes a Subsidiary
        and such investments were not made in contemplation of the Acquisition;
        and

       

          (t)    other
        investments, loans, and advances in addition to those otherwise permitted
        by
        this Section in an amount not to exceed 10% of the book value of the assets
        of
        the Borrower and its Subsidiaries as shown on the Borrower’s balance sheet as of
        the end of the immediately preceding fiscal year in the aggregate at any
        one
        time outstanding.

       

      In
        determining the amount of investments, acquisitions, loans, and advances
        permitted under this Section, investments and acquisitions shall always be
        taken
        at the original cost thereof (regardless of any subsequent appreciation or
        depreciation therein), and loans and advances shall be taken at the principal
        amount thereof then remaining unpaid.

       

          Section 8.10.    Mergers,
        Consolidations and Sales.
        The
        Borrower shall not, nor shall it permit any Subsidiary to, be a party to
        any
        merger or consolidation, or sell, transfer, lease or otherwise dispose of
        all or
        any part of its Property, including any disposition of Property as part of
        a
        sale and leaseback transaction, or in any event sell or discount (with or
        without recourse) any of its notes or sell accounts receivable; provided,
        however,
        that
        this Section shall not apply to nor operate to prevent:

       

          (a)    the
        sale or
        lease of inventory in the ordinary course of business;

       

          (b)    the
        sale,
        transfer, lease or other disposition of Property of the Borrower and the
        Guarantors to one another in the ordinary course of its business; 

       

          (c)    the
        sale,
        transfer, lease or other disposition of Property of a Foreign Subsidiary
        to the
        Borrower or any Subsidiary;

       

          (d)    the
        sale,
        transfer, lease or other disposition of Property of the Borrower and the
        Guarantors to any one or more Foreign Subsidiaries not to exceed 10% of the
        book
        value of the Borrower and its Subsidiaries assets as shown on the Borrower’s
        balance sheet as of the end of the immediately preceding fiscal year in the
        aggregate for all such transactions from the Closing Date, in each in the
        ordinary course of business;

       

          (e)    the
        merger of any Subsidiary with and into, the dissolution of any Subsidiary
        liquidating into, or the transfer of the capital stock or other equity interest
        of any Subsidiary to the Borrower or any other Subsidiary, provided
        that, in
        the case of any merger involving the Borrower, the Borrower is the corporation
        surviving the merger provided
        further
        that any
        merger involving a Guarantor, but not the Borrower, a Guarantor is the
        corporation surviving the merger;

       

          (f)    the
        sale
        or discount of delinquent notes or the sale of accounts receivable in the
        ordinary course of business for purposes of collection only (and not for
        the
        purpose of any bulk sale or securitization transaction (other than a Permitted
        Securitization));

       

          (g)    the
        sale,
        transfer or other disposition of any tangible personal property that, in
        the
        reasonable business judgment of the Borrower or its Subsidiary, has become
        obsolete or worn out, and which is disposed of in the ordinary course of
        business; 

       

          (h)    the
        sale,
        transfer or other disposition of Property of the Borrower which is classified
        as
“held for sale” on the Borrower’s balance sheet; 

       

          (i)    the
        sale,
        transfer or other disposition of the Borrower’s facilities located in Berne,
        Indiana and in Albuquerque, New Mexico;

       

          (j)    the
        sale
        of investments permitted pursuant to Section 8.9(a) through (e), (l), (m)
        and (n); and 

       

          (k)    the
        sale,
        transfer, lease or other disposition of Property of the Borrower or any
        Subsidiary (including any disposition of Property as part of a sale and
        leaseback transaction) aggregating for the Borrower and its Subsidiaries
        during
        any fiscal year of the Borrower of an amount not more than 10% of the fair
        market value of the assets of the Borrower and its Subsidiaries as shown
        on the
        Borrower’s balance sheet as of the end of the immediately preceding fiscal
        year.

       

          Section 8.11.    Maintenance
        of Subsidiaries.
        The
        Borrower shall not assign, sell or transfer, nor shall it permit any Subsidiary
        to issue, assign, sell or transfer, any shares of capital stock or other
        equity
        interests of a Subsidiary; provided,
        however,
        that the
        foregoing shall not operate to prevent (a) the issuance, sale, and transfer
        to any person of any shares of capital stock of a Subsidiary solely for the
        purpose of qualifying, and to the extent legally necessary to qualify, such
        person as a director of such Subsidiary, and (b) any transaction permitted
        by Section 8.10(e) or (k) above.

       

          Section 8.12.    Dividends
        and Certain Other Restricted Payments.
        The
        Borrower shall not, nor shall it permit any Subsidiary to, (a) declare or
        pay any dividends on or make any other distributions in respect of any class
        or
        series of its capital stock or other equity interests or (b) directly or
        indirectly purchase, redeem, or otherwise acquire or retire any of its capital
        stock or other equity interests or any warrants, options, or similar instruments
        to acquire the same; provided,
        however,
        that the
        foregoing shall not operate to prevent (I) the making of dividends or
        distributions (i) by any Subsidiary of the Borrower or its Subsidiaries to
        its parent corporation and (ii) so long as no Default or Event of Default
        under Section 8.23 exists prior to or would result on a pro
        forma
        basis
        after giving effect to such action, by the Borrower, (II) any distribution
        or
        redemption under the Borrower’s Shareholder Rights Plan, and (III) so long as no
        Default or Event of Default has occurred and is continuing, the Borrower
        may
        repurchase shares of its capital stock for an aggregate purchase price not
        to
        exceed $110,000,000 from the Closing Date.

       

          Section 8.13.    ERISA.
        The
        Borrower shall, and shall cause each Subsidiary to, promptly pay and discharge
        all obligations and liabilities arising under ERISA of a character which
        if
        unpaid or unperformed could reasonably be expected to result in the imposition
        of a Lien against any of its Property. The Borrower shall, and shall cause
        each
        Subsidiary to, promptly notify the Administrative Agent and each Lender of:
        (a) the occurrence of any reportable event (as defined in ERISA) with
        respect to a Plan, (b) receipt of any notice from the PBGC of its intention
        to seek termination of any Plan or appointment of a trustee therefor,
        (c) its intention to terminate or withdraw from any Plan, and (d) the
        occurrence of any event with respect to any Plan which would result in the
        incurrence by the Borrower or any Subsidiary of any material liability, fine
        or
        penalty, or any material increase in the contingent liability of the Borrower
        or
        any Subsidiary with respect to any post-retirement Welfare Plan
        benefit.

       

          Section 8.14.    Compliance
        with Laws.
        (a) The Borrower shall, and shall cause each Subsidiary to, comply in all
        respects with the requirements of all federal, state, and local laws, rules,
        regulations, ordinances and orders applicable to or pertaining to its Property
        or business operations, where any non-compliance with such requirements,
        individually or in the aggregate, could reasonably be expected to have a
        Material Adverse Effect or result in a Lien upon any of its Property other
        than
        a Lien permitted under Section 8.8.

       

          (b)    Without
        limiting the agreements set forth in Section 8.14(a) above, the Borrower
        shall, and shall cause each Subsidiary to, at all times, do the following
        to the
        extent the failure to do so, individually or in the aggregate, could reasonably
        be expected to have a Material Adverse Effect: (i) comply in all material
        respects with, and maintain each of the Premises in compliance in all material
        respects with, all applicable Environmental Laws; (ii) require that each
        tenant and subtenant, if any, of any of the Premises or any part thereof
        comply
        in all material respects with all applicable Environmental Laws;
        (iii) obtain and maintain in full force and effect all material
        governmental approvals required by any applicable Environmental Law for
        operations at each of the Premises; (iv) cure any material violation by it
        or at any of the Premises of applicable Environmental Laws; (v) not allow
        the presence or operation at any of the Premises of any (1) landfill or
        dump or (2) hazardous waste management facility or solid waste disposal
        facility as defined pursuant to RCRA or any comparable state law; (vi) not
        manufacture, use, generate, transport, treat, store, release, dispose or
        handle
        any Hazardous Material at any of the Premises except in the ordinary course
        of
        its business and in de
        minimis amounts;
        (vii) within 10 Business Days notify the Administrative Agent in
        writing of and provide any reasonably requested documents upon learning of
        any
        of the following in connection with the Borrower or any Subsidiary or any
        of the
        Premises: (1) any material liability for response or corrective action,
        natural resource damage or other harm pursuant to CERCLA, RCRA or any comparable
        state law; (2) any material Environmental Claim; (3) any material
        violation of an Environmental Law or material Release, threatened Release
        or
        disposal of a Hazardous Material; (4) any restriction on the ownership,
        occupancy, use or transferability arising pursuant to any (x) Release,
        threatened Release or disposal of a Hazardous Substance or (y) Environmental
        Law; or (5) any environmental, natural resource, health or safety
        condition, which could reasonably be expected to have a Material Adverse
        Effect;
        (viii) conduct at its expense any investigation, study, sampling, testing,
        abatement, cleanup, removal, remediation or other response action necessary
        to
        remove, remediate, clean up or abate any material Release, threatened Release
        or
        disposal of a Hazardous Material as required by any applicable Environmental
        Law, (ix) abide by and observe any restrictions on the use of the Premises
        imposed by any governmental authority as set forth in a deed or other instrument
        affecting the Borrower’s or any Subsidiary’s interest therein; (x) promptly
        provide or otherwise make available to the Administrative Agent any reasonably
        requested environmental record concerning the Premises which the Borrower
        or any
        Subsidiary possesses or can reasonably obtain; and (xi) perform, satisfy,
        and implement any operation or maintenance actions required by any governmental
        authority or Environmental Law, or included in any no further action letter
        or
        covenant not to sue issued by any governmental authority under any Environmental
        Law.

       

          Section 8.15.    Burdensome
        Contracts With Affiliates. The
        Borrower shall not, nor shall it permit any Subsidiary to, enter into any
        contract, agreement or business arrangement with any of its Affiliates on
        terms
        and conditions which are less favorable to the Borrower or such Subsidiary
        than
        would be usual and customary in similar contracts, agreements or business
        arrangements between Persons not affiliated with each other.

       

          Section 8.16.    No
        Changes in Fiscal Year.
        The
        fiscal year of the Borrower and its Subsidiaries ends on December 31 of
        each year; and the Borrower shall not, nor shall it permit any Subsidiary
        to,
        change its fiscal year from its present basis.

       

          Section 8.17.    Formation
        of
        Subsidiaries.
        Promptly
        upon the formation or acquisition of any Subsidiary, the Borrower shall provide
        the Administrative Agent and the Lenders notice thereof and timely comply
        with
        the requirements of Section 4 hereof (at which time Schedule 6.2 shall
        be deemed amended to include reference to such Subsidiary).

       

          Section 8.18.    Change
        in the
        Nature of Business. The
        Borrower shall not, nor shall it permit any Subsidiary to, engage in any
        business or activity if, as a result, the general nature of the business
        of the
        Borrower or any Subsidiary would be changed in any material respect from
        the
        general nature of the business engaged in by it as of the Closing
        Date.

       

          Section 8.19.    Use
        of Loan Proceeds.
        The
        Borrower shall use the credit extended under this Agreement solely for the
        purposes set forth in, or otherwise permitted by, Section 6.4
        hereof.

       

          Section 8.20.    No
        Restrictions.
        Except
        as provided herein and in the Subordinated Note Documents, the Borrower shall
        not, nor shall it permit any Subsidiary to, directly or indirectly create
        or
        otherwise cause or suffer to exist or become effective any consensual
        encumbrance or restriction of any kind on the ability of the Borrower or
        any
        Subsidiary to: (a) pay dividends or make any other distribution on any
        Subsidiary’s capital stock or other equity interests owned by the Borrower or
        any other Subsidiary, (b) pay any indebtedness owed to the Borrower or any
        other Subsidiary, (c) make loans or advances to the Borrower or any other
        Subsidiary, (d) transfer any of its Property to the Borrower or any other
        Subsidiary or (e) guarantee the Obligations as required by the Loan
        Documents.

       

          Section 8.21.    Subordinated
        Debt.
        The
        Borrower shall not amend, modify or supplement, or permit any Subsidiary
        to
        amend, modify or supplement (or consent to any amendment, modification or
        supplement of), any document, agreement or instrument evidencing the
        Subordinated Notes or any replacements, substitutions or renewals thereof
        (including, without limitation, the Subordinated Note Documents) where such
        amendment, modification or supplement provides for the following or which
        has
        any of the following effects:

       

          (i)    shortens
        or accelerates the date upon which any installment of principal or interest
        becomes due or adds any additional mandatory redemption provisions;

       

          (ii)    shortens
        the
        final maturity date of the Subordinated Notes or otherwise accelerates the
        amortization schedule with respect to the Subordinated Notes;

       

          (iii)    increases
        the rate of interest accruing on the Subordinated Notes;

       

          (iv)    provides
        for
        the payment of additional fees or increases existing fees;

       

          (v)    amends
        or
        modifies any financial or negative covenant (or covenant which prohibits
        or
        restricts the Borrower or a Subsidiary thereof from taking certain actions)
        in a
        manner which is more onerous or more restrictive in any material respect
        to the
        Borrower (or any Subsidiary of the Borrower) than the financial or negative
        covenants contained herein or in the Subordinated Note Documents as in effect
        on
        the Closing Date or which is otherwise materially adverse to the Borrower
        and/or
        the Lenders or, in the case of adding covenants, which places material
        additional restrictions on the Borrower (or a Subsidiary of the Borrower)
        or
        which requires the Borrower or any such Subsidiary to comply with more
        restrictive financial ratios or which requires the Borrower to better its
        financial performance from that set forth in the existing financial
        covenants;

       

          (vii)    amends,
        modifies or adds any affirmative covenant in a manner which, when taken as
        a
        whole, is materially adverse to the Borrower and/or the Lenders; or

       

          (viii)    amends,
        modifies, suspends or supplements the subordination provisions
        thereof;

       

      provided,
        however, that
        nothing in this Section 8.21 shall restrict the put, redemption or
        conversion rights set forth in the Subordinated Indenture, or the manner
        of
        settlement with respect thereto by the Borrower.

       

          Section 8.22.    Leverage
        Ratio.
        As of
        the last day of each fiscal quarter of the Borrower, the Borrower shall not
        permit the Leverage Ratio to be greater than 3.50 to 1.00.

       

          Section 8.23.    Fixed
        Charge
        Coverage Ratio.
        As of
        the last day of each fiscal quarter of the Borrower, the Borrower shall maintain
        a ratio of (a) Adjusted EBITDA for the four fiscal quarters of the Borrower
        then ended to (b) Fixed Charges for the same four fiscal quarters then
        ended of not less than 1.25 to 1.00.

       

      
        	
                Section 9.

              	
                Events
                  of Default and Remedies.

              

      

       

          Section 9.1.    Events
        of
        Default.
        Any one
        or more of the following shall constitute an “Event
        of Default”
        hereunder:

       

          (a)    default
        in the payment (i) when due of all or any part of the principal of or
        (ii) within two (2) Business Days of when due of all or any part of the
        interest on any Note or Loan (whether at the stated maturity thereof or at
        any
        other time provided for in this Agreement) or of any Reimbursement Obligation
        or
        of any fee or other Obligation payable hereunder or under any other Loan
        Document;

       

          (b)    default
        in
        the observance or performance of any covenant set forth in Sections 8.1,
        8.7, 8.8, 8.9, 8.10, 8.11, 8.12, 8.21, 8.22 or 8.23 hereof;

       

          (c)    default
        in the observance or performance of any other provision hereof or of any
        other
        Loan Document which is not remedied within 30 days after the earlier of
        (i) the date on which such failure shall first become known to any
        Authorized Officer of the Borrower or (ii) written notice thereof is given
        to the Borrower by the Administrative Agent; 

       

          (d)    any
        representation or warranty made herein or in any other Loan Document or in
        any
        certificate furnished to the Administrative Agent or the Lenders pursuant
        hereto
        or thereto or in connection with any transaction contemplated hereby or thereby
        proves untrue in any material respect as of the date of the issuance or making
        or deemed making thereof (except to the extent that the same expressly relate
        to
        an earlier date); 

       

          (e)    any
        event
        occurs or condition exists (other than those described in subsections (a)
        through (d) above) which is specified as an event of default under any of
        the
        other Loan Documents, or any of the Loan Documents shall for any reason not
        be
        or shall cease to be in full force and effect or is declared to be null and
        void, or any Subsidiary takes any action for the purpose of terminating,
        repudiating or rescinding any Loan Document executed by it or any of its
        obligations thereunder;

       

          (f)    (i)   default
        shall occur
        under any Indebtedness for Borrowed Money (other than the Subordinated Notes,
        which are addressed in clause (ii) below) issued, assumed or guaranteed by
        the
        Borrower or any Subsidiary aggregating in excess of $10,000,000, or under
        any
        indenture, agreement or other instrument under which the same may be issued,
        and
        such default shall continue for a period of time sufficient to permit the
        acceleration of the maturity of any such Indebtedness for Borrowed Money
        (whether or not such maturity is in fact accelerated), or any such Indebtedness
        for Borrowed Money shall not be paid when due (whether by demand, lapse of
        time,
        acceleration or otherwise);

       

          (ii)    The
        Borrower
        or any of its Subsidiaries shall fail to make any payment when due (whether
        by
        scheduled maturity, required prepayment, acceleration, demand or otherwise)
        with
        respect to the Subordinated Notes or any other amounts owing under or pursuant
        to the Subordinated Note Documents; or any breach, default or event of default
        shall occur, or any other condition shall exist under any instrument, agreement
        or indenture pertaining to the Subordinated Notes (including, without
        limitation, an “Event
        of Default”
        or
“Fundamental
        Change”
        under
        and as defined in the Subordinated Note Documents), if the effect thereof
        is to
        cause an acceleration, mandatory redemption, a requirement that the Borrower
        offer to purchase the Subordinated Notes or other required repurchase of
        the
        Subordinated Notes, or permit the Subordinated Noteholders to accelerate
        the
        maturity of the Subordinated Notes or require a redemption or other repurchase
        of the Subordinated Notes; or any amounts owing under or pursuant to the
        Subordinated Notes or any other Subordinated Note Document shall be otherwise
        declared to be due and payable (by acceleration or otherwise) or required
        to be
        prepaid, redeemed or otherwise repurchased by the Borrower or any of its
        Subsidiaries (other than by a regularly scheduled required prepayment) prior
        to
        the stated maturity thereof; provided
        that
        the
        redemption, purchase or conversion of the Notes by the Borrower under sections
        3, 4 or 12 of the Subordinated Indenture shall constitute and of Event of
        Default hereunder;

       

          (g)    any
        judgment
        or judgments, writ or writs or warrant or warrants of attachment, or any
        similar
        process or processes, shall be entered or filed against the Borrower or any
        Subsidiary, or against any of its Property, in an aggregate amount in excess
        of
        $10,000,000 (except to the extent fully covered by insurance pursuant to
        which
        the insurer has accepted liability therefor in writing), and which remains
        undischarged, unvacated, unbonded or unstayed for a period of 30 days;

       

          (h)    the
        Borrower
        or any Subsidiary, or any member of its Controlled Group, shall fail to pay
        when
        due an amount or amounts aggregating in excess of $10,000,000 which it shall
        have become liable to pay to the PBGC or to a Plan under Title IV of ERISA;
        or notice of intent to terminate a Plan or Plans having aggregate Unfunded
        Vested Liabilities in excess of $10,000,000 (collectively, a “Material
        Plan”)
        shall
        be filed under Title IV of ERISA by the Borrower or any Subsidiary, or any
        other member of its Controlled Group, any plan administrator or any combination
        of the foregoing; or the PBGC shall institute proceedings under Title IV of
        ERISA to terminate or to cause a trustee to be appointed to administer any
        Material Plan or a proceeding shall be instituted by a fiduciary of any Material
        Plan against the Borrower or any Subsidiary, or any member of its Controlled
        Group, to enforce Section 515 or 4219(c)(5) of ERISA and such proceeding
        shall not have been dismissed within 30 days thereafter; or a condition shall
        exist by reason of which the PBGC would be entitled to obtain a decree
        adjudicating that any Material Plan must be terminated; 

       

          (i)    any
        Change of
        Control shall occur;

       

          (j)    the
        Borrower or any Subsidiary shall (i) have entered involuntarily against it
        an order for relief under the United States Bankruptcy Code, as amended,
        (ii) not pay, or admit in writing its inability to pay, its debts generally
        as they become due, (iii) make an assignment for the benefit of creditors,
        (iv) apply for, seek, consent to or acquiesce in, the appointment of a
        receiver, custodian, trustee, examiner, liquidator or similar official for
        it or
        any substantial part of its Property, (v) institute any proceeding seeking
        to have entered against it an order for relief under the United States
        Bankruptcy Code, as amended, to adjudicate it insolvent, or seeking dissolution,
        winding up, liquidation, reorganization, arrangement, adjustment or composition
        of it or its debts under any law relating to bankruptcy, insolvency or
        reorganization or relief of debtors or fail to file an answer or other pleading
        denying the material allegations of any such proceeding filed against it,
        (vi) take any corporate action in furtherance of any matter described in
        parts (i) through (v) above, or (vii) fail to contest in good faith
        any appointment or proceeding described in Section 9.1(k) hereof;
        or

       

          (k)    a
        custodian,
        receiver, trustee, examiner, liquidator or similar official shall be appointed
        for the Borrower or any Subsidiary, or any substantial part of any of its
        Property, or a proceeding described in Section 9.1(j)(v) shall be
        instituted against the Borrower or any Subsidiary, and such appointment
        continues undischarged or such proceeding continues undismissed or unstayed
        for
        a period of 60 days.

       

          Section 9.2.    Non-Bankruptcy
        Defaults.
        When any
        Event of Default other than those described in subsection (j) (other than
        clause (ii) thereof) or (k) of Section 9.1 hereof has occurred and is
        continuing, the Administrative Agent shall, by written notice to the Borrower:
        (a) if so directed by the Required Lenders, terminate the remaining
        Revolving Credit Commitments on the date stated in such notice (which may
        be the
        date thereof); (b) if so directed by the Required Lenders, declare the
        principal of and the accrued interest on all outstanding Loans to be forthwith
        due and payable and thereupon all outstanding Loans, including both principal
        and interest thereon, shall be and become immediately due and payable together
        with all other amounts payable under the Loan Documents without further demand,
        presentment, protest or notice of any kind; and (c) if so directed by the
        Required Lenders, demand that the Borrower immediately pay to the Administrative
        Agent the full amount then available for drawing under each or any Letter
        of
        Credit, and the Borrower agrees to immediately make such payment and
        acknowledges and agrees that the Lenders would not have an adequate remedy
        at
        law for failure by the Borrower to honor any such demand and that the
        Administrative Agent, for the benefit of the Lenders, shall have the right
        to
        require the Borrower to specifically perform such undertaking whether or
        not any
        drawings or other demands for payment have been made under any Letter of
        Credit.
        The Administrative Agent, after giving notice to the Borrower pursuant to
        Section 9.1(c) or this Section 9.2, shall also promptly send a copy of
        such notice to the other Lenders, but the failure to do so shall not impair
        or
        annul the effect of such notice.

       

          Section 9.3.    Bankruptcy
        Defaults.
        When
        any Event of Default described in subsections (j) (other than clause (ii)
        thereof) or (k) of Section 9.1 hereof has occurred and is continuing, then
        all outstanding Loans shall immediately become due and payable together with
        all
        other amounts payable under the Loan Documents without presentment, demand,
        protest or notice of any kind, the obligation of the Lenders to extend further
        credit pursuant to any of the terms hereof shall immediately terminate and
        the
        Borrower shall immediately pay to the Administrative Agent the full amount
        then
        available for drawing under all outstanding Letters of Credit, the Borrower
        acknowledging and agreeing that the Lenders would not have an adequate remedy
        at
        law for failure by the Borrower to honor any such demand and that the Lenders,
        and the Administrative Agent on their behalf, shall have the right to require
        the Borrower to specifically perform such undertaking whether or not any
        draws
        or other demands for payment have been made under any of the Letters of
        Credit.

       

          Section 9.4.    Collateral
        for Undrawn Letters of Credit.
        (a) If the prepayment of the amount available for drawing under any or all
        outstanding Letters of Credit is required under Section 1.8(b) or under
        Section 9.2 or 9.3 above, the Borrower shall forthwith pay the amount
        required to be so prepaid, to be held by the Administrative Agent as provided
        in
        subsection (b) below.

       

          (b)    All
        amounts prepaid pursuant to subsection (a) above shall be held by the
        Administrative Agent in one or more separate collateral accounts (each such
        account, and the credit balances, properties, and any investments from time
        to
        time held therein, and any substitutions for such account, any certificate
        of
        deposit or other instrument evidencing any of the foregoing and all proceeds
        of
        and earnings on any of the foregoing being collectively called the “Collateral
        Account”)
        as
        security for, and for application by the Administrative Agent (to the extent
        available) to, the reimbursement of any payment under any Letter of Credit
        then
        or thereafter made by the Administrative Agent, and to the payment of the
        unpaid
        balance of any other Obligations. The Collateral Account shall be held in
        the
        name of and subject to the exclusive dominion and control of the Administrative
        Agent for the benefit of the Administrative Agent, the Lenders, and the L/C
        Issuer. If and when requested by the Borrower, the Administrative Agent shall
        invest funds held in the Collateral Account from time to time in direct
        obligations of, or obligations the principal of and interest on which are
        unconditionally guaranteed by, the United States of America with a remaining
        maturity of one year or less, provided
        that the
        Administrative Agent is irrevocably authorized to sell investments held in
        the
        Collateral Account when and as required to make payments out of the Collateral
        Account for application to amounts due and owing from the Borrower to the
        L/C
        Issuer, the Administrative Agent or the Lenders; provided,
        however,
        that if
        (i) the Borrower shall have made payment of all such obligations referred
        to in subsection (a) above, (ii) all relevant preference or other
        disgorgement periods relating to the receipt of such payments have passed,
        and
        (iii) no Letters of Credit, Revolving Credit Commitments, Loans or other
        Obligations remain outstanding hereunder, then the Administrative Agent shall
        release to the Borrower any remaining amounts held in the Collateral
        Account.

       

          Section 9.5.    Notice
        of Default.
        The
        Administrative Agent shall give notice to the Borrower under Section 9.1(c)
        hereof promptly upon being requested to do so by any Lender and shall thereupon
        notify all the Lenders thereof.

       

          Section 9.6.    Expenses.
        The
        Borrower agrees to pay to the Administrative Agent and each Lender, and any
        other holder of any Note outstanding hereunder, all costs and expenses
        reasonably incurred or paid by the Administrative Agent and such Lender or
        any
        such holder, including reasonable attorneys’ fees and court costs, in connection
        with any Event of Default by the Borrower hereunder or in connection with
        the
        enforcement of any of the Loan Documents (including all such costs and expenses
        incurred in connection with any proceeding under the United States Bankruptcy
        Code involving the Borrower or any Subsidiary as a debtor
        thereunder).

       

      
        	
                Section 10.

              	
                Change
                  in Circumstances.

              

      

       

          Section 10.1.    Change
        of Law.
        Notwithstanding any other provisions of this Agreement or any Note, if at
        any
        time any change in applicable law or regulation or in the interpretation
        thereof
        makes it unlawful for any Lender to make or continue to maintain any Eurodollar
        Loans or to perform its obligations as contemplated hereby, such Lender shall
        promptly give notice thereof to the Borrower and such Lender’s obligations to
        make or maintain Eurodollar Loans under this Agreement shall be suspended
        until
        it is no longer unlawful for such Lender to make or maintain Eurodollar Loans.
        The Borrower shall prepay on demand the outstanding principal amount of any
        such
        affected Eurodollar Loans, together with all interest accrued thereon and
        all
        other amounts then due and payable to such Lender under this Agreement;
provided,
        however,
        subject
        to all of the terms and conditions of this Agreement, the Borrower may then
        elect to borrow the principal amount of the affected Eurodollar Loans from
        such
        Lender by means of Base Rate Loans from such Lender, which Base Rate Loans
        shall
        not be made ratably by the Lenders but only from such affected
        Lender.

       

          Section 10.2.    Unavailability
        of Deposits or Inability to Ascertain, or Inadequacy of, LIBOR.
        If on
        or prior to the first day of any Interest Period for any Borrowing of Eurodollar
        Loans:

       

          (a)    the
        Administrative Agent determines that deposits in U.S. Dollars (in the applicable
        amounts) are not being offered to it in the interbank eurodollar market for
        such
        Interest Period, or that by reason of circumstances affecting the interbank
        eurodollar market adequate and reasonable means do not exist for ascertaining
        the applicable LIBOR, or

       

          (b)    the
        Required Lenders advise the Administrative Agent that (i) LIBOR as determined
        by
        the Administrative Agent will not adequately and fairly reflect the cost
        to such
        Lenders of funding their Eurodollar Loans for such Interest Period or (ii)
        that
        the making or funding of Eurodollar Loans become impracticable, 

       

      then
        the
        Administrative Agent shall forthwith give notice thereof to the Borrower
        and the
        Lenders, whereupon until the Administrative Agent notifies the Borrower that
        the
        circumstances giving rise to such suspension no longer exist, the obligations
        of
        the Lenders to make Eurodollar Loans shall be suspended.

       

          Section 10.3.    Increased
        Cost and Reduced Return.
        (a) If, on or after the date hereof, the adoption of any applicable law,
        rule or regulation, or any change therein, or any change in the interpretation
        or administration thereof by any governmental authority, central bank or
        comparable agency charged with the interpretation or administration thereof,
        or
        compliance by any Lender (or its Lending Office) with any request or directive
        (whether or not having the force of law) of any such authority, central bank
        or
        comparable agency:

       

          (i)    shall
        subject
        any Lender (or its Lending Office) to any tax, duty or other charge with
        respect
        to its Eurodollar Loans, its Notes, its Letter(s) of Credit, or its
        participation in any thereof, any Reimbursement Obligations owed to it or
        its
        obligation to make Eurodollar Loans, issue a Letter of Credit, or to participate
        therein, or shall change the basis of taxation of payments to any Lender
        (or its
        Lending Office) of the principal of or interest on its Eurodollar Loans,
        Letter(s) of Credit, or participations therein or any other amounts due under
        this Agreement or any other Loan Document in respect of its Eurodollar Loans,
        Letter(s) of Credit, any participation therein, any Reimbursement Obligations
        owed to it, or its obligation to make Eurodollar Loans, or issue a Letter
        of
        Credit, or acquire participations therein (except for changes in the rate
        or
        calculation of tax on the overall net income of (or franchise taxes imposed
        in
        lieu of such income taxes on) such Lender or its Lending Office imposed by
        the
        jurisdiction in which such Lender is organized or maintains its principal
        executive office or Lending Office); or

       

          (ii)    shall
        impose, modify or deem applicable any reserve, special deposit or similar
        requirement (including, without limitation, any such requirement imposed
        by the
        Board of Governors of the Federal Reserve System, but excluding with respect
        to
        any Eurodollar Loans any such requirement included in an applicable Eurodollar
        Reserve Percentage) against assets of, deposits with or for the account of,
        or
        credit extended by, any Lender (or its Lending Office) or shall impose on
        any
        Lender (or its Lending Office) or on the interbank market any other condition
        affecting its Eurodollar Loans, its Notes, its Letter(s) of Credit, or its
        participation in any thereof, any Reimbursement Obligation owed to it, or
        its
        obligation to make Eurodollar Loans, or to issue a Letter of Credit, or to
        participate therein;

       

      and
        the
        result of any of the foregoing is to increase the cost to such Lender (or
        its
        Lending Office) of making or maintaining any Eurodollar Loan, issuing or
        maintaining a Letter of Credit, or participating therein, or to reduce the
        amount of any sum received or receivable by such Lender (or its Lending Office)
        under this Agreement or under any other Loan Document with respect thereto,
        by
        an amount deemed by such Lender to be material, then, within 15 days after
        demand by such Lender (with a copy to the Administrative Agent), the Borrower
        shall be obligated to pay to such Lender such additional amount or amounts
        as
        will compensate such Lender for such increased cost or reduction.

       

          (b)    If,
        after
        the date hereof, any Lender or the Administrative Agent shall have determined
        that the adoption of any applicable law, rule or regulation regarding capital
        adequacy, or any change therein, or any change in the interpretation or
        administration thereof by any governmental authority, central bank or comparable
        agency charged with the interpretation or administration thereof, or compliance
        by any Lender (or its Lending Office) or any corporation controlling such
        Lender
        with any request or directive regarding capital adequacy (whether or not
        having
        the force of law) of any such authority, central bank or comparable agency,
        has
        had the effect of reducing the rate of return on such Lender’s or such
        corporation’s capital as a consequence of its obligations hereunder to a level
        below that which such Lender or such corporation could have achieved but
        for
        such adoption, change or compliance (taking into consideration such Lender’s or
        such corporation’s policies with respect to capital adequacy) by an amount
        deemed by such Lender to be material, then from time to time, within
        15 days after demand by such Lender (with a copy to the Administrative
        Agent), the Borrower shall pay to such Lender such additional amount or amounts
        as will compensate such Lender for such reduction. 

       

          (c)    Notwithstanding
        any
        provision hereof to the contrary, the Borrower shall not be required to
        compensate any Lender or the L/C Issuer pursuant to this Section 10.3 for
        any increased capital costs incurred more than 180 days prior to the date
        such
        Lender or L/C Issuer notifies the Borrower of the event giving rise to such
        increased capital cost and of such Lender’s or the L/C Issuer’s intention to
        claim compensation therefor; provided
        further, however, that
        such
        180-day limitation shall not apply to any costs that are applicable
        retroactively so long as the applicable Lender or the L/C Issuer notifies
        the
        Borrower of such cost within 180 days of a responsible officer of such Lender
        or
        the L/C Issuer receiving actual knowledge thereof.

       

          (d)    A
        certificate
        of a Lender claiming compensation under this Section 10.3 and setting forth
        the additional amount or amounts to be paid to it hereunder shall be conclusive
        if reasonably determined. In determining such amount, such Lender may use
        any
        reasonable averaging and attribution methods.

       

          Section 10.4.    Lending
        Offices.
        Each
        Lender may, at its option, elect to make its Loans hereunder at the branch,
        office or affiliate specified on the appropriate signature page hereof (each
        a
“Lending
        Office”)
        for
        each type of Loan available hereunder or at such other of its branches, offices
        or affiliates as it may from time to time elect and designate in a written
        notice to the Borrower and the Administrative Agent. To the extent reasonably
        possible, a Lender shall designate an alternative branch or funding office
        with
        respect to its Eurodollar Loans to reduce any liability of the Borrower to
        such
        Lender under Section 10.3 hereof or to avoid the unavailability of
        Eurodollar Loans under Section 10.2 hereof, so long as such designation is
        not otherwise disadvantageous to the Lender.

       

          Section 10.5.    Discretion
        of Lender as to Manner of Funding.
        Notwithstanding any other provision of this Agreement, each Lender shall
        be
        entitled to fund and maintain its funding of all or any part of its Loans
        in any
        manner it sees fit, it being understood, however, that for the purposes of
        this
        Agreement all determinations hereunder with respect to Eurodollar Loans shall
        be
        made as if each Lender had actually funded and maintained each Eurodollar
        Loan
        through the purchase of deposits in the interbank eurodollar market having
        a
        maturity corresponding to such Loan’s Interest Period, and bearing an interest
        rate equal to LIBOR for such Interest Period.

       

      
        	
                Section 11.

              	
                The
                  Administrative Agent.

              

      

       

          Section 11.1.    Appointment
        and Authorization of Administrative Agent.
        Each
        Lender hereby appoints Harris N.A. as the Administrative Agent under the
        Loan
        Documents and hereby authorizes the Administrative Agent to take such action
        as
        Administrative Agent on its behalf and to exercise such powers under the
        Loan
        Documents as are delegated to the Administrative Agent by the terms thereof,
        together with such powers as are reasonably incidental thereto. The Lenders
        expressly agree that the Administrative Agent is not acting as a fiduciary
        of
        the Lenders in respect of the Loan Documents, the Borrower or otherwise,
        and
        nothing herein or in any of the other Loan Documents shall result in any
        duties
        or obligations on the Administrative Agent or any of the Lenders except as
        expressly set forth herein. 

       

          Section 11.2.    Administrative
        Agent
        and its Affiliates.
        The
        Administrative Agent shall have the same rights and powers under this Agreement
        and the other Loan Documents as any other Lender and may exercise or refrain
        from exercising such rights and power as though it were not the Administrative
        Agent, and the Administrative Agent and its affiliates may accept deposits
        from,
        lend money to, and generally engage in any kind of business with the Borrower
        or
        any Affiliate of the Borrower as if it were not the Administrative Agent
        under
        the Loan Documents. The term “Lender”
        as used
        herein and in all other Loan Documents, unless the context otherwise clearly
        requires, includes the Administrative Agent in its individual capacity as
        a
        Lender. References in Section 1 hereof to the Administrative Agent’s Loans,
        or to the amount owing to the Administrative Agent for which an interest
        rate is
        being determined, refer to the Administrative Agent in its individual capacity
        as a Lender.

       

          Section 11.3.    Action
        by Administrative Agent.
        If the
        Administrative Agent receives from the Borrower a written notice of an Event
        of
        Default pursuant to Section 8.5 hereof, the Administrative Agent shall
        promptly give each of the Lenders written notice thereof. The obligations
        of the
        Administrative Agent under the Loan Documents are only those expressly set
        forth
        therein. Without limiting the generality of the foregoing, the Administrative
        Agent shall not be required to take any action hereunder with respect to
        any
        Default or Event of Default, except as expressly provided in Sections 9.2
        and 9.5. Unless and until the Required Lenders give such direction, the
        Administrative Agent may (but shall not be obligated to) take or refrain
        from
        taking such actions as it deems appropriate and in the best interest of all
        the
        Lenders. In no event, however, shall the Administrative Agent be required
        to
        take any action in violation of applicable law or of any provision of any
        Loan
        Document, and the Administrative Agent shall in all cases be fully justified
        in
        failing or refusing to act hereunder or under any other Loan Document unless
        it
        first receives any further assurances of its indemnification from the Lenders
        that it may require, including prepayment of any related expenses and any
        other
        protection it requires against any and all costs, expense, and liability
        which
        may be incurred by it by reason of taking or continuing to take any such
        action.
        The Administrative Agent shall be entitled to assume that no Default or Event
        of
        Default exists unless notified in writing to the contrary by a Lender or
        the
        Borrower. In all cases in which the Loan Documents do not require the
        Administrative Agent to take specific action, the Administrative Agent shall
        be
        fully justified in using its discretion in failing to take or in taking any
        action thereunder. Any instructions of the Required Lenders, or of any other
        group of Lenders called for under the specific provisions of the Loan Documents,
        shall be binding upon all the Lenders and the holders of the Obligations.
        

       

          Section 11.4.    Consultation
        with Experts.
        The
        Administrative Agent may consult with legal counsel, independent public
        accountants, and other experts selected by it and shall not be liable for
        any
        action taken or omitted to be taken by it in good faith in accordance with
        the
        advice of such counsel, accountants or experts.

       

          Section 11.5.    Liability
        of
        Administrative Agent; Credit Decision.
        Neither
        the Administrative Agent nor any of its directors, officers, agents or employees
        shall be liable for any action taken or not taken by it in connection with
        the
        Loan Documents: (i) with the consent or at the request of the Required
        Lenders or (ii) in the absence of its own gross negligence or willful
        misconduct. Neither the Administrative Agent nor any of its directors, officers,
        agents or employees shall be responsible for or have any duty to ascertain,
        inquire into or verify: (i) any statement, warranty or representation made
        in connection with this Agreement, any other Loan Document or any Credit
        Event;
        (ii) the performance or observance of any of the covenants or agreements of
        the Borrower or any Subsidiary contained herein or in any other Loan Document;
        (iii) the satisfaction of any condition specified in Section 7 hereof,
        except receipt of items required to be delivered to the Administrative Agent;
        or
        (iv) the validity, effectiveness, genuineness, enforceability, perfection,
        value, worth or collectibility hereof or of any other Loan Document or of
        any
        other documents or writing furnished in connection with any Loan Document;
        and
        the Administrative Agent makes no representation of any kind or character
        with
        respect to any such matter mentioned in this sentence. The Administrative
        Agent
        may execute any of its duties under any of the Loan Documents by or through
        employees, agents, and attorneys-in-fact and shall not be answerable to the
        Lenders, the Borrower, or any other Person for the default or misconduct
        of any
        such agents or attorneys-in-fact selected with reasonable care. The
        Administrative Agent shall not incur any liability by acting in reliance
        upon
        any notice, consent, certificate, other document or statement (whether written
        or oral) believed by it to be genuine or to be sent by the proper party or
        parties. In particular and without limiting any of the foregoing, the
        Administrative Agent shall have no responsibility for confirming the accuracy
        of
        any compliance certificate or other document or instrument received by it
        under
        the Loan Documents. The Administrative Agent may treat the payee of any Note
        as
        the holder thereof until written notice of transfer shall have been filed
        with
        the Administrative Agent signed by such payee in form satisfactory to the
        Administrative Agent. Each Lender acknowledges that it has independently
        and
        without reliance on the Administrative Agent or any other Lender, and based
        upon
        such information, investigations and inquiries as it deems appropriate, made
        its
        own credit analysis and decision to extend credit to the Borrower in the
        manner
        set forth in the Loan Documents. It shall be the responsibility of each Lender
        to keep itself informed as to the creditworthiness of the Borrower and its
        Subsidiaries, and the Administrative Agent shall have no liability to any
        Lender
        with respect thereto.

       

          Section 11.6.    Indemnity.
        The
        Lenders shall ratably, in accordance with their respective Revolver Percentages,
        indemnify and hold the Administrative Agent, and its directors, officers,
        employees, agents, and representatives harmless from and against any
        liabilities, losses, costs or expenses suffered or incurred by it under any
        Loan
        Document or in connection with the transactions contemplated thereby, regardless
        of when asserted or arising, except to the extent they are promptly reimbursed
        for the same by the Borrower and except to the extent that any event giving
        rise
        to a claim was caused by the gross negligence or willful misconduct of the
        party
        seeking to be indemnified. The obligations of the Lenders under this Section
        shall survive termination of this Agreement. The Administrative Agent shall
        be
        entitled to offset amounts received for the account of a Lender under this
        Agreement against unpaid amounts due from such Lender to the Administrative
        Agent hereunder (whether as fundings of participations, indemnities or
        otherwise), but shall not be entitled to offset against amounts owed to the
        Administrative Agent by any Lender arising outside of this Agreement and
        the
        other Loan Documents.

       

          Section 11.7.    Resignation
        of Administrative Agent and Successor Administrative Agent.
        The
        Administrative Agent may resign at any time by giving written notice thereof
        to
        the Lenders and the Borrower. Upon any such resignation of the Administrative
        Agent, the Required Lenders shall have the right to appoint a successor
        Administrative Agent. If no successor Administrative Agent shall have been
        so
        appointed by the Required Lenders, and shall have accepted such appointment,
        within 30 days after the retiring Administrative Agent’s giving of notice
        of resignation then the retiring Administrative Agent may, on behalf of the
        Lenders, appoint a successor Administrative Agent, which may be any Lender
        hereunder or any commercial bank organized under the laws of the United States
        of America or of any State thereof and having a combined capital and surplus
        of
        at least $200,000,000. Upon the acceptance of its appointment as the
        Administrative Agent hereunder, such successor Administrative Agent shall
        thereupon succeed to and become vested with all the rights and duties of
        the
        retiring Administrative Agent under the Loan Documents, and the retiring
        Administrative Agent shall be discharged from its duties and obligations
        thereunder. After any retiring Administrative Agent’s resignation hereunder as
        Administrative Agent, the provisions of this Section 11 and all protective
        provisions of the other Loan Documents shall inure to its benefit as to any
        actions taken or omitted to be taken by it while it was Administrative Agent,
        but no successor Administrative Agent shall in any event be liable or
        responsible for any actions of its predecessor. If the Administrative Agent
        resigns and no successor is appointed, the rights and obligations of such
        Administrative Agent shall be automatically assumed by the Required Lenders
        and
        the Borrower shall be directed to make all payments due each Lender hereunder
        directly to such Lender.

       

          Section 11.8.    L/C
        Issuer.
        The
        L/C Issuer shall act on behalf of the Lenders with respect to any Letters
        of Credit issued by it and the documents associated therewith. The
        L/C Issuer shall have all of the benefits and immunities (i) provided
        to the Administrative Agent in this Section 11 with respect to any acts
        taken or omissions suffered by the L/C Issuer in connection with Letters of
        Credit issued by it or proposed to be issued by it and the Applications
        pertaining to such Letters of Credit as fully as if the term “Administrative
        Agent”, as used in this Section 11, included the L/C Issuer with
        respect to such acts or omissions and (ii) as additionally provided in this
        Agreement with respect to such L/C Issuer.

       

          Section 11.9.    Designation
        of Additional Agents.
        The
        Administrative Agent shall have the continuing right, for purposes hereof,
        at
        any time and from time to time to designate one or more of the Lenders (and/or
        its or their Affiliates) as “syndication agents,” “documentation agents,”
“arrangers,” or other designations for purposes hereto, but such designation
        shall have no substantive effect, and such Lenders and their Affiliates shall
        have no additional powers, duties or responsibilities as a result
        thereof.

       

      
        	
                Section 12.

              	
                The
                  Guarantees.

              

      

       

          Section 12.1.    The
        Guarantees.
        To
        induce the Lenders to provide the credits described herein and in consideration
        of benefits expected to accrue to the Borrower by reason of the Revolving
        Credit
        Commitments and for other good and valuable consideration, receipt of which
        is
        hereby acknowledged, each Subsidiary listed on the signature pages hereto
        and
        each other Material Subsidiary (individually a “Guarantor”
        and
        collectively the “Guarantors,”
        including Material Subsidiaries formed or acquired after the Closing Date
        executing an Additional Guarantor Supplement) hereby unconditionally and
        irrevocably guarantee jointly and severally to the Administrative Agent,
        the
        Lenders, and their Affiliates, the due and punctual payment of all present
        and
        future Obligations, Hedging Liability, and Funds Transfer and Deposit Account
        Liability, including, but not limited to, the due and punctual payment of
        principal of and interest on the Notes, the Reimbursement Obligations, and
        the
        due and punctual payment of all other Obligations now or hereafter owed by
        the
        Borrower under the Loan Documents as and when the same shall become due and
        payable, whether at stated maturity, by acceleration, or otherwise, according
        to
        the terms hereof and thereof. In case of failure by the Borrower or any
        Subsidiary punctually to pay any Obligations, Hedging Liability, or Funds
        Transfer and Deposit Account Liability guaranteed hereby, each Guarantor
        hereby
        unconditionally agrees to make such payment or to cause such payment to be
        made
        punctually as and when the same shall become due and payable, whether at
        stated
        maturity, by acceleration, or otherwise, and as if such payment were made
        by the
        Borrower or such Subsidiary.

       

          Section 12.2.    Guarantee
        Unconditional.
        The
        obligations of each Guarantor under this Section 12 shall be unconditional
        and absolute and, without limiting the generality of the foregoing, shall
        not be
        released, discharged, or otherwise affected by:

       

          (a)    any
        extension, renewal, settlement, compromise, waiver, or release in respect
        of any
        obligation of the Borrower or of any other guarantor under this Agreement
        or any
        other Loan Document or by operation of law or otherwise;

       

          (b)    any
        modification or amendment of or supplement to this Agreement or any other
        Loan
        Document;

       

          (c)    any
        change in the corporate existence, structure, or ownership of, or any
        insolvency, bankruptcy, reorganization, or other similar proceeding affecting,
        the Borrower, any other guarantor, or any of their respective assets, or
        any
        resulting release or discharge of any obligation of the Borrower or of any
        other
        guarantor contained in any Loan Document; 

       

          (d)    the
        existence of any claim, set-off, or other rights which the Borrower or any
        other
        guarantor may have at any time against the Administrative Agent, any Lender,
        or
        any other Person, whether or not arising in connection herewith;

       

          (e)    any
        failure to assert, or any assertion of, any claim or demand or any exercise
        of,
        or failure to exercise, any rights or remedies against the Borrower, any
        other
        guarantor, or any other Person or Property;

       

          (f)    any
        application of any sums by whomsoever paid or howsoever realized to any
        obligation of the Borrower, regardless of what obligations of the Borrower
        remain unpaid;

       

          (g)    any
        invalidity or unenforceability relating to or against the Borrower or any
        other
        guarantor for any reason of this Agreement or of any other Loan Document
        or any
        provision of applicable law or regulation purporting to prohibit the payment
        by
        the Borrower or any other guarantor of the principal of or interest on any
        Note
        or any Reimbursement Obligation or any other amount payable under the Loan
        Documents; or

       

          (h)    any
        other
        act or omission to act or delay of any kind by the Administrative Agent,
        any
        Lender, or any other Person or any other circumstance whatsoever that might,
        but
        for the provisions of this paragraph, constitute a legal or equitable discharge
        of the obligations of any Guarantor under this Section 12.

       

          Section 12.3.    Discharge
        Only upon Payment in Full; Reinstatement in Certain
        Circumstances.
        Each
        Guarantor’s obligations under this Section 12 shall remain in full force
        and effect until the Revolving Credit Commitments are terminated, all Letters
        of
        Credit have expired, and the principal of and interest on the Notes and all
        other amounts payable by the Borrower and the Guarantors under this Agreement
        and all other Loan Documents and, if then outstanding and unpaid, all Hedging
        Liability and Funds Transfer and Deposit Account Liability shall have been
        paid
        in full. If at any time any payment of the principal of or interest on any
        Note
        or any Reimbursement Obligation or any other amount payable by the Borrower
        or
        any Guarantor under the Loan Documents is rescinded or must be otherwise
        restored or returned upon the insolvency, bankruptcy, or reorganization of
        the
        Borrower or of any guarantor, or otherwise, each Guarantor’s obligations under
        this Section 12 with respect to such payment shall be reinstated at such
        time as though such payment had become due but had not been made at such
        time.

       

          Section 12.4.    Subrogation.
        Each
        Guarantor agrees it will not exercise any rights which it may acquire by
        way of
        subrogation by any payment made hereunder, or otherwise, until all the
        Obligations, Hedging Liability, and Funds Transfer and Deposit Account Liability
        shall have been paid in full subsequent to the termination of all the Revolving
        Credit Commitments and expiration of all Letters of Credit. If any amount
        shall
        be paid to a Guarantor on account of such subrogation rights at any time
        prior
        to the later of (x) the payment in full of the Obligations, Hedging
        Liability, and Funds Transfer and Deposit Account Liability and all other
        amounts payable by the Borrower hereunder and the other Loan Documents and
        (y) the termination of the Revolving Credit Commitments and expiration of
        all Letters of Credit, such amount shall be held in trust for the benefit
        of the
        Administrative Agent and the Lenders and shall forthwith be paid to the
        Administrative Agent for the benefit of the Lenders or be credited and applied
        upon the Obligations, Hedging Liability, and Funds Transfer and Deposit Account
        Liability, whether matured or unmatured, in accordance with the terms of
        this
        Agreement.

       

          Section 12.5.    Waivers.
        Each
        Guarantor irrevocably waives acceptance hereof, presentment, demand, protest,
        and any notice not provided for herein, as well as any requirement that at
        any
        time any action be taken by the Administrative Agent, any Lender, or any
        other
        Person against the Borrower, another guarantor, or any other Person except
        where
        such action is expressly required by the Loan Documents.

       

          Section 12.6.    Limit
        on Recovery.
        Notwithstanding any other provision hereof, the right of recovery against
        each
        Guarantor under this Section 12 shall not exceed $1.00 less than the lowest
        amount which would render such Guarantor’s obligations under this Section 12
        void or voidable under applicable law, including, without limitation, fraudulent
        conveyance law.

       

          Section 12.7.    Stay
        of
        Acceleration.
        If
        acceleration of the time for payment of any amount payable by the Borrower
        under
        this Agreement or any other Loan Document, or under any agreement establishing
        Hedging Liability or Funds Transfer and Deposit Account Liability, is stayed
        upon the insolvency, bankruptcy or reorganization of the Borrower, all such
        amounts otherwise subject to acceleration under the terms of this Agreement
        or
        the other Loan Documents, or under any agreement establishing Hedging Liability
        or Funds Transfer and Deposit Account Liability, shall nonetheless be payable
        by
        the Guarantors hereunder forthwith on demand by the Administrative Agent
        made at
        the request of the Required Lenders.

       

          Section 12.8.    Benefit
        to
        Guarantors.
        All of
        the Guarantors are engaged in related businesses and integrated to such an
        extent that the financial strength and flexibility of the Borrower and each
        Guarantor has a direct impact on the success of each Guarantor. Each Guarantor
        will derive substantial direct and indirect benefit from the extension of
        credit
        hereunder.

       

          Section
        12.9.    Guarantor
        Covenants.
        Each
        Guarantor shall take such action as the Borrower is required by this Agreement
        to cause such Guarantor to take, and shall refrain from taking such action
        as
        the Borrower is required by this Agreement to prohibit such Guarantor from
        taking.

       

      Section 13.     Miscellaneous.

       

          Section 13.1.    Withholding
        Taxes.
        (a) Payments
        Free of Withholding.
        Except
        as otherwise required by law and subject to Section 13.1(b) hereof, each
        payment by the Borrower under this Agreement or the other Loan Documents
        shall
        be made without withholding for or on account of any present or future taxes,
        other than taxes on the net income (or franchise taxes in lieu thereof) of
        any
        Lender or the Administrative Agent imposed by a jurisdiction in which such
        Lender or Administrative Agent is organized, maintains its principal office
        or
        the relevant Lending Office (or any political subdivision of any such
        jurisdiction) (such nonexcluded taxes being referred to herein as “Taxes”).
        Except
        as otherwise provided in Section 13.1(b), if any withholding of Taxes is
        required, the Borrower shall make the withholding, pay the amount withheld
        to
        the appropriate governmental authority before penalties attach thereto or
        interest accrues thereon and forthwith pay such additional amount as may
        be
        necessary to ensure that the net amount actually received by each Lender
        and the
        Administrative Agent free and clear of such Taxes (including such Taxes on
        such
        additional amount) is equal to the amount which that Lender or the
        Administrative Agent (as the case may be) would have received had such
        withholding not been made. If the Administrative Agent or any Lender pays
        any
        amount in respect of any such Taxes, including penalties or interest, the
        Borrower shall reimburse the Administrative Agent or such Lender for that
        payment on demand in the currency in which such payment was made, except
        to the
        extent that any penalties or interest result from such Lender’s or the
        Administrative Agent’s gross negligence or willful delay. If the Borrower pays
        any such Taxes, penalties or interest, it shall deliver official tax receipts
        evidencing that payment or certified copies thereof to the Lender or
        Administrative Agent on whose account such withholding was made (with a copy
        to
        the Administrative Agent if not the recipient of the original) or, if such
        official receipt is not received from the relevant governmental authority,
        such
        other evidence of payment as may be reasonably acceptable to the Administrative
        Agent on or before the thirtieth day after payment. If any Lender or the
        Administrative Agent receives a refund in respect of any Taxes for which
        such
        Lender or the Administrative Agent has received payment from the Borrower
        hereunder, it shall promptly apply such refund (including any interest received
        by such Lender or the Administrative Agent from the taxing authority with
        respect to the refund with respect to such Taxes) to the Obligations of the
        Borrower; provided
        that
        the
        Borrower, upon the request of such Lender or the Administrative Agent, agrees
        to
        reimburse such refund (plus penalties, interest or other charges) to such
        Lender
        or the Administrative Agent in the event such Lender or the Administrative
        Agent
        is required to repay such refund.

       

          (b)    U.S.
        Withholding Tax.
        Each
        Lender that is not a United States person (as such term is defined in
        Section 7701(a)(30) of the Code) (a “Foreign
        Lender”)
        shall
        submit to the Borrower and the Administrative Agent on or before the date
        the
        initial Credit Event is made hereunder or, if later, the date such financial
        institution becomes a Lender hereunder, two duly completed and signed copies
        of
        (i) either Form W-8 BEN (relating to such Lender and entitling it to a
        complete exemption from withholding under the Code on all amounts to be received
        by such Lender, including fees, pursuant to the Loan Documents and the
        Obligations) or Form W-8 ECI (relating to all amounts to be received
        by such Lender, including fees, pursuant to the Loan Documents and the
        Obligations) of the United States Internal Revenue Service and (ii) solely
        if such Lender is claiming exemption from United States withholding tax under
        Section 871(h) or 881(c) of the Code with respect to payments of “portfolio
        interest”, a certificate representing that such Lender is not a bank for
        purposes of Section 881(c) of the Code, is not a 10-percent shareholder
        (within the meaning of Section 871(h)(3)(B) of the Code) of the Borrower
        and is not a controlled foreign corporation related to the Borrower (within
        the
        meaning of Section 864(d)(4) of the Code). Any Foreign Lender that fails to
        comply with the requirements of the preceding sentence shall not be entitled
        to
        the benefits of Section 13.1(a) hereof. Thereafter and from time to time,
        each Foreign Lender shall submit to the Borrower and the Administrative Agent
        such additional duly completed and signed copies of one or the other of such
        Forms (or such successor forms as shall be adopted from time to time by the
        relevant United States taxing authorities) and such other certificates as
        such Foreign Lender may be entitled to submit under then-current United States
        law or regulations to avoid or reduce United States withholding taxes on
        payments in respect of all amounts to be received by such Foreign Lender,
        including fees, pursuant to the Loan Documents or the Obligations. Upon the
        request of the Borrower or the Administrative Agent, each Lender that is
        a
        United States person (as such term is defined in Section 7701(a)(30) of the
        Code) shall submit to the Borrower and the Administrative Agent a certificate
        to
        the effect that it is such a United States person.

       

          (c)    Inability
        of Lender to Submit Forms.
        If any
        Lender determines, as a result of any change in applicable law, regulation
        or
        treaty, or in any official application or interpretation thereof, that it
        is
        unable to submit to the Borrower or the Administrative Agent any form or
        certificate that such Lender is obligated to submit pursuant to
        subsection (b) of this Section 13.1 or that such Lender is required to
        withdraw or cancel any such form or certificate previously submitted or any
        such
        form or certificate otherwise becomes ineffective or inaccurate, such Lender
        shall promptly notify the Borrower and Administrative Agent of such fact
        and the
        Lender shall to that extent not be obligated to provide any such form or
        certificate and will be entitled to withdraw or cancel any affected form
        or
        certificate, as applicable.

       

          Section 13.2.    No
        Waiver,
        Cumulative Remedies.
        No delay
        or failure on the part of the Administrative Agent or any Lender or on the
        part
        of the holder or holders of any of the Obligations in the exercise of any
        power
        or right under any Loan Document shall operate as a waiver thereof or as
        an
        acquiescence in any default, nor shall any single or partial exercise of
        any
        power or right preclude any other or further exercise thereof or the exercise
        of
        any other power or right. The rights and remedies hereunder of the
        Administrative Agent, the Lenders and of the holder or holders of any of
        the
        Obligations are cumulative to, and not exclusive of, any rights or remedies
        which any of them would otherwise have.

       

          Section 13.3.    Non-Business
        Days.
        If any
        payment hereunder becomes due and payable on a day which is not a Business
        Day,
        the due date of such payment shall be extended to the next succeeding Business
        Day on which date such payment shall be due and payable. In the case of any
        payment of principal falling due on a day which is not a Business Day, interest
        on such principal amount shall continue to accrue during such extension at
        the
        rate per annum then in effect, which accrued amount shall be due and payable
        on
        the next scheduled date for the payment of interest.

       

          Section 13.4.    Documentary
        Taxes.
        The
        Borrower agrees to pay on demand any documentary, stamp or similar taxes
        payable
        in respect of this Agreement or any other Loan Document, including interest
        and
        penalties, in the event any such taxes are assessed, irrespective of when
        such
        assessment is made and whether or not any credit is then in use or available
        hereunder.

       

          Section 13.5.    Survival
        of Representations.
        All
        representations and warranties made herein or in any other Loan Document
        or in
        certificates given pursuant hereto or thereto shall survive the execution
        and
        delivery of this Agreement and the other Loan Documents, and shall continue
        in
        full force and effect with respect to the date as of which they were made
        as
        long as any Credit is in use or available hereunder.

       

          Section 13.6.    Survival
        of
        Indemnities.
        All
        indemnities and other provisions relative to reimbursement to the Lenders
        of
        amounts sufficient to protect the yield of the Lenders with respect to the
        Loans
        and Letters of Credit, including, but not limited to, Sections 1.11, 10.3,
        and 13.15 hereof, shall survive the termination of this Agreement and the
        other
        Loan Documents and the payment of the Obligations.

       

          Section 13.7.    Sharing
        of
        Set-Off.
        Each
        Lender agrees with each other Lender a party hereto that if such Lender shall
        receive and retain any payment, whether by set-off or application of deposit
        balances or otherwise, on any of the Loans or Reimbursement Obligations in
        excess of its ratable share of payments on all such Obligations then outstanding
        to the Lenders, then such Lender shall purchase for cash at face value, but
        without recourse, ratably from each of the other Lenders such amount of the
        Loans or Reimbursement Obligations, or participations therein, held by each
        such
        other Lenders (or interest therein) as shall be necessary to cause such Lender
        to share such excess payment ratably with all the other Lenders; provided,
        however,
        that if
        any such purchase is made by any Lender, and if such excess payment or part
        thereof is thereafter recovered from such purchasing Lender, the related
        purchases from the other Lenders shall be rescinded ratably and the purchase
        price restored as to the portion of such excess payment so recovered, but
        without interest. For purposes of this Section, amounts owed to or recovered
        by
        the L/C Issuer in connection with Reimbursement Obligations in which Lenders
        have been required to fund their participation shall be treated as amounts
        owed
        to or recovered by the L/C Issuer as a Lender hereunder.

       

          Section 13.8.    Notices.
        Except
        as otherwise specified herein, all notices hereunder and under the other
        Loan
        Documents shall be in writing (including, without limitation, notice by
        telecopy) and shall be given to the relevant party at its address or telecopier
        number set forth below, or such other address or telecopier number as such
        party
        may hereafter specify by notice to the Administrative Agent and the Borrower
        given by courier, by United States certified or registered mail, by telecopy
        or
        by other telecommunication device capable of creating a written record of
        such
        notice and its receipt. Notices under the Loan Documents to the Lenders and
        the
        Administrative Agent shall be addressed to their respective addresses or
        telecopier numbers set forth in its Administrative Questionnaire, and to
        the
        Borrower to:

       

      CTS
        Corporation

      905
        West
        Boulevard North

      Elkhart,
        Indiana 46514

      Attention: Matt
        Long, Treasurer

      Telephone: (574)
        293-7511

      Telecopy: (574)
        293-6146

       

      Each
        such
        notice, request or other communication shall be effective (i) if given by
        telecopier, when such telecopy is transmitted to the telecopier number specified
        in this Section or on the signature pages hereof and a confirmation of such
        telecopy has been received by the sender, (ii) if given by mail, five
        (5) days after such communication is deposited in the mail, certified or
        registered with return receipt requested, addressed as aforesaid or
        (iii) if given by any other means, when delivered at the addresses
        specified in this Section or on the Administrative Questionnaire; provided
        that any
        notice given pursuant to Section 1 hereof shall be effective only upon
        receipt.

       

          Section 13.9.    Counterparts.
        This
        Agreement may be executed in any number of counterparts, and by the different
        parties hereto on separate counterpart signature pages, and all such
        counterparts taken together shall be deemed to constitute one and the same
        instrument.

       

          Section 13.10.    Successors
        and Assigns.
        This
        Agreement shall be binding upon the Borrower and the Guarantors and their
        successors and assigns, and shall inure to the benefit of the Administrative
        Agent and each of the Lenders and the benefit of their respective successors
        and
        assigns, including any subsequent holder of any of the Obligations. The Borrower
        may not assign any of its rights or obligations under any Loan Document without
        the written consent of all of the Lenders.

       

          Section 13.11.    Participants.
        Each
        Lender shall have the right at its own cost to grant participations (to be
        evidenced by one or more agreements or certificates of participation) in
        the
        Loans made and Reimbursement Obligations and/or Commitments held by such
        Lender
        at any time and from time to time to one or more other Persons; provided
        that no
        such participation shall relieve any Lender of any of its obligations under
        this
        Agreement, and, provided, further that no such participant shall have any
        rights
        under this Agreement except as provided in this Section, and the Administrative
        Agent shall have no obligation or responsibility to such participant. Any
        agreement pursuant to which such participation is granted shall provide that
        the
        granting Lender shall retain the sole right and responsibility to enforce
        the
        obligations of the Borrower under this Agreement and the other Loan Documents
        including, without limitation, the right to approve any amendment, modification
        or waiver of any provision of the Loan Documents, except that such agreement
        may
        provide that such Lender will not agree to any modification, amendment or
        waiver
        of the Loan Documents that would reduce the amount of or postpone any fixed
        date
        for payment of any Obligation in which such participant has an interest.
        Any
        party to which such a participation has been granted shall have the benefits
        of
        Section 1.11 and Section 10.3 hereof. The Borrower authorizes each
        Lender to disclose to any participant or prospective participant under this
        Section any financial or other information pertaining to the Borrower or
        any
        Subsidiary.

       

          Section 13.12.    Assignments.
        (a) Any Lender may at any time assign to one or more assignees all or a
        portion of its rights and obligations under this Agreement (including all
        or a
        portion of its Revolving Credit Commitment and the Loans at the time owing
        to
        it); provided
        that any
        such assignment shall be subject to the following conditions: 

       

          (i)    Minimum
        Amounts.
        (A) In the case of an assignment of the entire remaining amount of the
        assigning Lender’s Revolving Credit Commitment and the Loans and participation
        interest in L/C Obligations and Swing Loans at the time owing to it or in
        the
        case of an assignment to a Lender, an Affiliate of a Lender or an Approved
        Fund,
        no minimum amount need be assigned; and (B) in any case not described in
        subsection (a)(i)(A) of this Section, the aggregate amount of the Revolving
        Credit Commitment (which for this purpose includes Loans and participation
        interest in L/C Obligations and Swing Loans outstanding thereunder) or, if
        the
        applicable Revolving Credit Commitment is not then in effect, the principal
        outstanding balance of the Loans and participation interest in L/C Obligations
        and Swing Loans of the assigning Lender subject to each such assignment
        (determined as of the date the Assignment and Acceptance with respect to
        such
        assignment is delivered to the Administrative Agent or, if “Effective Date” is
        specified in the Assignment and Acceptance, as of the Effective Date) shall
        not
        be less than $5,000,000, unless each of the Administrative Agent and, so
        long as
        no Event of Default has occurred and is continuing, the Borrower otherwise
        consents (each such consent not to be unreasonably withheld or
        delayed);

       

          (ii)    Proportionate
        Amounts.Each
        partial assignment shall be made as an assignment of a proportionate part
        of all
        the assigning Lender’s rights and obligations under this Agreement with respect
        to the Loan or the Revolving Credit Commitment assigned.

       

          (iii)    Required
        Consents.The
        following consents shall be required for any assignment in addition to the
        extent required by Section 13.12(a)(i)(B):

       

          (a)    the
        consent of the Borrower (such consent not to be unreasonably withheld or
        delayed) shall be required unless (x) an Event of Default has
        occurred and is continuing at the time of such assignment or (y) such assignment
        is to a Lender, an Affiliate of a Lender or an Approved Fund;

       

          (b)    the
        consent of the Administrative Agent (such consent not to be unreasonably
        withheld or delayed) shall be required for assignments if such assignment
        is to
        a Person that is not a Lender with a Revolving Credit Commitment in respect
        of
        such facility, an Affiliate of such Lender or an Approved Fund with respect
        to
        such Lender; and

       

          (c)    the
        consent of the L/C Issuer (such consent not to be unreasonably withheld or
        delayed) shall be required for any assignment that increases the obligation
        of
        the assignee to participate in exposure under one or more Letters of Credit
        (whether or not then outstanding).

       

          (iv)    Assignment
        and Acceptance.The
        parties to each assignment shall execute and deliver to the Administrative
        Agent
        an Assignment and Acceptance, together with a processing and recordation
        fee of
        $3,500, and the assignee, if it is not a Lender, shall deliver to the
        Administrative Agent an Administrative Questionnaire.

       

          (v)    No
        Assignment
        to Borrower or Parent.
        No such
        assignment shall be made to the Borrower or any of its Affiliates or
        Subsidiaries.

       

           (vi)    No
        Assignment
        to Natural Persons.No
        such
        assignment shall be made to a natural person.

       

      Subject
        to acceptance and recording thereof by the Administrative Agent pursuant
        to
        Section 13.12(b) hereof, from and after the “Effective
        Date”
        specified in each Assignment and Acceptance, the assignee thereunder shall
        be a
        party to this Agreement and, to the extent of the interest assigned by such
        Assignment and Acceptance, have the rights and obligations of a Lender under
        this Agreement, and the assigning Lender thereunder shall, to the extent
        of the
        interest assigned by such Assignment and Acceptance, be released from its
        obligations under this Agreement (and, in the case of an Assignment and
        Acceptance covering all of the assigning Lender’s rights and obligations under
        this Agreement, such Lender shall cease to be a party hereto) but shall continue
        to be entitled to the benefits of Sections 13.6 and 13.15 with respect to
        facts and circumstances occurring prior to the “Effective
        Date”
        of such
        assignment. Any assignment or transfer by a Lender of rights or obligations
        under this Agreement that does not comply with this paragraph shall be treated
        for purposes of this Agreement as a sale by such Lender of a participation
        in
        such rights and obligations in accordance with Section 13.11
        hereof.

       

          (b)    Register.
        The
        Administrative Agent, acting solely for this purpose as an agent of the
        Borrower, shall maintain at one of its offices in Chicago, Illinois, a copy
        of
        each Assignment and Acceptance delivered to it and a register for the
        recordation of the names and addresses of the Lenders, and the Revolving
        Credit
        Commitments of, and principal amounts of the Loans owing to, each Lender
        pursuant to the terms hereof from time to time (the “Register”).
        The
        entries in the Register shall be conclusive, and the Borrower, the
        Administrative Agent, and the Lenders may treat each Person whose name is
        recorded in the Register pursuant to the terms hereof as a Lender hereunder
        for
        all purposes of this Agreement, notwithstanding notice to the contrary. The
        Register shall be available for inspection by the Borrower and any Lender,
        at
        any reasonable time and from time to time upon reasonable prior
        notice.

       

          (c)    Any
        Lender may at any time pledge or grant a security interest in all or any
        portion
        of its rights under this Agreement to secure obligations of such Lender,
        including any such pledge or grant to a Federal Reserve Bank, and this Section
        shall not apply to any such pledge or grant of a security interest; provided
        that no
        such pledge or grant of a security interest shall release a Lender from any
        of
        its obligations hereunder or substitute any such pledgee or secured party
        for
        such Lender as a party hereto; provided
        further, however,
        the
        right of any such pledgee or grantee (other than any Federal Reserve Bank)
        to
        further transfer all or any portion of the rights pledged or granted to it,
        whether by means of foreclosure or otherwise, shall be at all times subject
        to
        the terms of this Agreement. 

       

          Section 13.13.    Amendments.
        Any
        provision of this Agreement or the other Loan Documents may be amended or
        waived
        if, but only if, such amendment or waiver is in writing and is signed by
        (a) the
        Borrower, (b) the Required Lenders, and (c) if the rights or duties of the
        Administrative Agent or the L/C Issuer are affected thereby, the Administrative
        Agent or such L/C Issuer; provided that:

       

      (i)    no
        amendment
        or waiver pursuant to this Section 13.13 shall (A) increase any
        Revolving Credit Commitment of any Lender without the consent of such Lender
        or
        (B) reduce the amount of or postpone the date for any scheduled payment of
        any principal of or interest on any Loan or of any Reimbursement Obligation
        or
        of any fee payable hereunder without the consent of the Lender to which such
        payment is owing or which has committed to make such Loan or Letter of Credit
        (or participate therein) hereunder; and

       

      (ii)    no
        amendment
        or waiver pursuant to this Section 13.13 shall, unless signed by each
        Lender, change the definitions of Revolving Credit Termination Date or Required
        Lenders, change the provisions of this Section 13.13, release any guarantor
        that
        is a Material Subsidiary (except as otherwise provided for in the Loan
        Documents), or affect the number of Lenders required to take any action
        hereunder or under any other Loan Document.

       

          Section 13.14.    Headings.
        Section
        headings used in this Agreement are for reference only and shall not affect
        the
        construction of this Agreement.

       

          Section 13.15.    Costs
        and Expenses; Indemnification.
        The
        Borrower agrees to pay all reasonable costs and expenses of the Administrative
        Agent in connection with the preparation, negotiation, syndication, and
        administration of the Loan Documents, including, without limitation, the
        reasonable fees and disbursements of counsel to the Administrative Agent,
        in
        connection with the preparation and execution of the Loan Documents, and
        any
        amendment, waiver or consent related thereto, whether or not the transactions
        contemplated herein are consummated. The Borrower further agrees to indemnify
        the Administrative Agent, each Lender, and their respective directors, officers,
        employees, agents, financial advisors, and consultants against all losses,
        claims, damages, penalties, judgments, liabilities and reasonable expenses
        (including, without limitation, all reasonable expenses of litigation or
        preparation therefor, whether or not the indemnified Person is a party thereto,
        or any settlement arrangement arising from or relating to any such litigation)
        which any of them may pay or incur arising out of or relating to any Loan
        Document or any of the transactions contemplated thereby or the direct or
        indirect application or proposed application of the proceeds of any Loan
        or
        Letter of Credit, other than those which arise from the gross negligence
        or
        willful misconduct of the party claiming indemnification. The Borrower, upon
        demand by the Administrative Agent or a Lender at any time, shall reimburse
        the
        Administrative Agent or such Lender for any legal or other expenses incurred
        in
        connection with investigating or defending against any of the foregoing
        (including any settlement costs relating to the foregoing) except if the
        same is
        due to the gross negligence or willful misconduct of the party to be
        indemnified. The obligations of the Borrower under this Section shall survive
        the termination of this Agreement.

       

          Section 13.16.    Set-off.
        In
        addition to any rights now or hereafter granted under applicable law and
        not by
        way of limitation of any such rights, upon the occurrence of any Event of
        Default, each Lender and each subsequent holder of any Obligation is hereby
        authorized by the Borrower and each Guarantor at any time or from time to
        time,
        without notice to the Borrower or such Guarantor or to any other Person,
        any
        such notice being hereby expressly waived, to set-off and to appropriate
        and to
        apply any and all deposits (general or special, including, but not limited
        to,
        indebtedness evidenced by certificates of deposit, whether matured or unmatured,
        but not including trust accounts, and in whatever currency denominated) and
        any
        other indebtedness at any time held or owing by that Lender or that subsequent
        holder to or for the credit or the account of the Borrower or such Guarantor,
        whether or not matured, against and on account of the Obligations of the
        Borrower or such Guarantor to that Lender or that subsequent holder under
        the
        Loan Documents, including, but not limited to, all claims of any nature or
        description arising out of or connected with the Loan Documents, irrespective
        of
        whether or not (a) that Lender or that subsequent holder shall have made
        any demand hereunder or (b) the principal of or the interest on the Loans
        or Notes and other amounts due hereunder shall have become due and payable
        pursuant to Section 9 and although said obligations and liabilities, or any
        of them, may be contingent or unmatured. 

       

          Section 13.17.    Entire
        Agreement.
        The
        Loan Documents constitute the entire understanding of the parties thereto
        with
        respect to the subject matter thereof and any prior agreements, whether written
        or oral, with respect thereto are superseded hereby.

       

          Section 13.18.    Governing
        Law.
        This
        Agreement and the other Loan Documents, and the rights and duties of the
        parties
        hereto, shall be construed and determined in accordance with the internal
        laws
        of the State of Illinois.

       

          Section 13.19.    Severability
        of Provisions.
        Any
        provision of any Loan Document which is unenforceable in any jurisdiction
        shall,
        as to such jurisdiction, be ineffective to the extent of such unenforceability
        without invalidating the remaining provisions hereof or affecting the validity
        or enforceability of such provision in any other jurisdiction. All rights,
        remedies and powers provided in this Agreement and the other Loan Documents
        may
        be exercised only to the extent that the exercise thereof does not violate
        any
        applicable mandatory provisions of law, and all the provisions of this Agreement
        and other Loan Documents are intended to be subject to all applicable mandatory
        provisions of law which may be controlling and to be limited to the extent
        necessary so that they will not render this Agreement or the other Loan
        Documents invalid or unenforceable.

       

          Section 13.20.    Excess
        Interest.
        Notwithstanding any provision to the contrary contained herein or in any
        other
        Loan Document, no such provision shall require the payment or permit the
        collection of any amount of interest in excess of the maximum amount of interest
        permitted by applicable law to be charged for the use or detention, or the
        forbearance in the collection, of all or any portion of the Loans or other
        obligations outstanding under this Agreement or any other Loan Document
        (“Excess
        Interest”).
        If any
        Excess Interest is provided for, or is adjudicated to be provided for, herein
        or
        in any other Loan Document, then in such event (a) the provisions of this
        Section shall govern and control, (b) neither the Borrower nor any
        guarantor or endorser shall be obligated to pay any Excess Interest,
        (c) any Excess Interest that the Administrative Agent or any Lender may
        have received hereunder shall, at the option of the Administrative Agent,
        be
        (i) applied as a credit against the then outstanding principal amount of
        Obligations hereunder and accrued and unpaid interest thereon (not to exceed
        the
        maximum amount permitted by applicable law), (ii) refunded to the Borrower,
        or (iii) any combination of the foregoing, (d) the interest rate
        payable hereunder or under any other Loan Document shall be automatically
        subject to reduction to the maximum lawful contract rate allowed under
        applicable usury laws (the “Maximum
        Rate”),
        and
        this Agreement and the other Loan Documents shall be deemed to have been,
        and
        shall be, reformed and modified to reflect such reduction in the relevant
        interest rate, and (e) neither the Borrower nor any guarantor or endorser
        shall have any action against the Administrative Agent or any Lender for
        any
        damages whatsoever arising out of the payment or collection of any Excess
        Interest. Notwithstanding the foregoing, if for any period of time interest
        on
        any of Borrower’s Obligations is calculated at the Maximum Rate rather than the
        applicable rate under this Agreement, and thereafter such applicable rate
        becomes less than the Maximum Rate, the rate of interest payable on the
        Borrower’s Obligations shall remain at the Maximum Rate until the Lenders have
        received the amount of interest which such Lenders would have received during
        such period on the Borrower’s Obligations had the rate of interest not been
        limited to the Maximum Rate during such period.

       

          Section 13.21.    Lender’s
        Obligations Several.
        The
        obligations of the Lenders hereunder are several and not joint. Nothing
        contained in this Agreement and no action taken by the Lenders pursuant hereto
        shall be deemed to constitute the Lenders a partnership, association, joint
        venture or other entity.

       

          Section 13.22.    Submission
        to Jurisdiction; Waiver of Jury Trial.
        The
        Borrower and the Guarantors hereby submit to the nonexclusive jurisdiction
        of
        the United States District Court for the Northern District of Illinois and
        of
        any Illinois State court sitting in the City of Chicago for purposes of all
        legal proceedings arising out of or relating to this Agreement, the other
        Loan
        Documents or the transactions contemplated hereby or thereby. The Borrower
        and
        the Guarantors irrevocably waive, to the fullest extent permitted by law,
        any
        objection which they may now or hereafter have to the laying of the venue
        of any
        such proceeding brought in such a court and any claim that any such proceeding
        brought in such a court has been brought in an inconvenient forum. The
        Borrower, the Guarantors, the Administrative Agent, and the Lenders hereby
        irrevocably waive any and all right to trial by jury in any legal proceeding
        arising out of or relating to any Loan Document or the transactions contemplated
        thereby.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

          Section 13.23    Confidentiality.
        Each of
        the Administrative Agent, L/C Issuer and each Lender agrees to keep confidential
        any nonpublic information provided to it by or on behalf of the Borrower
        pursuant to or in connection with this Agreement and identified as such;
        provided
        that
        nothing
        herein shall prevent any of the Administrative Agent, L/C Issuer or any Lender
        from disclosing any such information (i) to the Administrative Agent, L/C
        Issuer, or any other Lender, (ii) to any participant or assignee or
        prospective participant or assignee so long as such participant or assignee
        or
        prospective participant or assignee agrees in writing to the requirement
        that
        such information be kept confidential in the manner contemplated by this
        Section 13.23, (iii) to its employees involved in the administration
        of this Agreement, directors, attorneys, accountants and other professional
        advisors (each of which shall be instructed to hold the same in confidence),
        (iv) in response to the request or demand of any governmental authority,
        (v) in response to any order of any court or other governmental authority
        or as may otherwise be required pursuant to any law, regulation or legal
        process; provided,
        however, that
        such
        Lender, to the extent legally permitted to do so, will use its best efforts
        to
        notify the Borrower prior to any disclosure of information contemplated by
        this
        subparagraph (v), (vi) which has been publicly disclosed other than in
        breach of this Agreement, (vii) in connection with the exercise of any
        remedy hereunder or under any Credit Document, (viii) subject to an
        agreement containing provisions substantially the same as those of this Section,
        to (A) any assignee of or participant in, or any prospective assignee of or
        participant in, any of its rights or obligations under this Agreement or
        (B) any actual or prospective counterparty (or its advisors) to any swap or
        derivative transaction relating to the Borrower or any Subsidiary and its
        obligations, (ix) with the prior written consent of the Borrower,
        (x) to the extent such information (A) becomes publicly available
        other than as a result of a breach of this Section or (B) becomes available
        to the Administrative Agent, any Lender or the L/C Issuer on a non-confidential
        basis from a source other than the Borrower or any Subsidiary or any of their
        directors, officers, employees or agents, including accountants, legal counsel
        and other advisors, (xi) to rating agencies if requested or required by such
        agencies in connection with a rating relating to the Loans or Commitments
        hereunder, or (xii) to entities which compile and publish information about
        the
        syndicated loan market, provided
        that
        only basic information about the pricing and structure of the transaction
        evidenced hereby may be disclosed pursuant to this subsection (xii).

       

          Section 13.24.    USA
        Patriot
        Act.
        Each
        Lender that is subject to the requirements of the USA Patriot Act (Title
        III of
        Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”)
        hereby
        notifies the Borrower that pursuant to the requirements of the Act, it is
        required to obtain, verify, and record information that identifies the Borrower,
        which information includes the name and address of the Borrower and other
        information that will allow such Lender to identify the Borrower in accordance
        with the Act.

       

      [Signature
        Pages to Follow]

       

      
        
          

        

      

      
      

          This
        Agreement is entered into between us for the uses and purposes hereinabove
        set
        forth as of the date first above written.

       

      “Borrower”

       

      CTS
        Corporation,

                                          an
        Indiana
        corporation

       

       

      By 
        /s/
        Matthew W. Long______________

      Name:
        Matthew W. Long

      Title:
        Treasurer

       

      “Guarantors”

       

      CTS
        Corporation,

                                             a
        Delaware
        corporation

       

      

       

      By
        /s/
        Matthew W. Long______________

      Name:
        Matthew W. Long

      Title:
        Treasurer

       

      CTS
        Electronics Components, Inc.

       

      

       

      By
        /s/
        Richard G. Cutter______________

      Name:
        Richard G. Cutter

      Title:
        Vice President & Secretary

       

      Dynamics
        Corporation of America

       

      

       

      By 
        /s/
        Matthew W. Long______________

      Name:
        Matthew W. Long

      Title:
        Vice President & Treasurer

       

      LTB
        Investment Corporation

       

      

       

      By 
        /s/
        Matthew W. Long______________

      Name:
        Matthew W. Long

      Title:
        Vice President & Treasurer

       

      CTS
        Electronics Manufacturing Solutions, Inc. 

      

      

      By 
        /s/
        Richard G. Cutter______________

      Name:
        Richard G. Cutter

      Title:
        Vice President & Secretary

       

      CTS
        Electronics Manufacturing Solutions (Santa Clara), Inc.

       

      

       

      By 
        /s/
        Richard G. Cutter______________

      Name:
        Richard G. Cutter

      Title:
        Vice President & Secretary

       

      CTS
        Electronics Manufacturing Solutions (Moorpark), Inc.

       

       

      By 
        /s/
        Richard G. Cutter______________

      Name:
        Richard G. Cutter

      Title:
        Vice President & Secretary

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      “Lenders”

       

      Harris
        N.A.,
        in its
        individual capacity as a Lender, as L/C Issuer, and as Administrative
        Agent

       

      By 
        /s/
        Thad D. Rasche________________

      Name:
        Thad D. Rasche

      Title:
        Director

       

      National
        City Bank of Indiana

       

       

       

      By 
        /s/
        Chris D. Thornton_______________

      Name:
        Chris D. Thornton

      Title:
        Vice President

       

      The
        Northern Trust Company

       

       

       

      By 
        /s/
        Jared Hall_____________________

      Name:
        Jared Hall

      Title:
        Vice President

       

      Comerica
        Bank

       

       

       

      By 
        /s/
        Catherine Meister Young________

      Name:
        Catherine Meister Young

      Title:
        Vice President

      

       

      LaSalle
        Bank National Association

       

       

       

      By 
        /s/
        John K. Beardslee______________

      Name:
        John K. Beardslee

      Title:
        Senior Vice President

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