Document:

Exhibit 10.2

 

REGISTRATION RIGHTS AGREEMENT

 

This REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is made as of March 6, 2006 by and among
TRC Companies, Inc., a Delaware corporation (the “Company”),
and certain purchasers of the Company’s common stock listed on the signature pages hereto
(the “Holders”).

 

WITNESSETH

 

WHEREAS, the Company and the Holders entered into a
Purchase Agreement as of March 6, 2006 (the “Purchase
Agreement”), providing, among other things, for the Holders’
purchase of 2,162,162 shares (the “Shares”) of the
Company’s Common Stock, $0.10 par value (“Common Stock”);
and

 

WHEREAS, in consideration of the purchase of the
Shares pursuant to the Purchase Agreement, the Company agreed to grant certain
rights to the Holders as set forth in this Agreement.

 

NOW, THEREFORE, the parties hereby agree as follows:

 

1.                                       Registration
Rights. The Company covenants and agrees as follows:

 

1.1                                 Definitions.
Terms defined in the Purchase Agreement and not otherwise defined herein are
used herein with the same meanings as defined in the Purchase Agreement. As
used in this Agreement, the following capitalized defined terms shall have the
following meanings:

 

“Advice” has the meaning set forth in Section 1.3(b).

 

“Affiliate” means, with respect to any Person, any other Person that
directly or indirectly controls or is controlled by or is under common control
with such Person. For the purposes of this definition, “control”, when used
with respect to any Person, means possession, direct or indirect, of the power
to direct or cause the direction of the management and policies of the such
Person, whether through the ownership of voting securities, by contract or
otherwise; and the terms of “affiliated”, “controlling” and “controlled” have
meanings correlative to the foregoing.

 

“Business Day” means
a day other than a Saturday, Sunday or other day on which banking institutions
in New York, New York are permitted or required by any applicable law to close.

 

“Commission” means the Securities and Exchange Commission.

 

“Company” has the meaning set forth in the Preamble and also includes
the Company’s successors.

 

“Delay Notice” has
the meaning set forth in Section 1.2(c).

 

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“Delay Period” has
the meaning set forth in Section 1.2(c).

 

“Effectiveness Period” has
the meaning set forth in Section 1.2(b).

 

“Exchange Act” means
the Securities Exchange Act of 1934, as amended from time to time.

 

“Holder” or
“Holders” has the meaning set forth
in the Preamble or each Person to whom a Holder Transfers Registrable
Securities in accordance with Section 1.8.

 

“Inspectors” has
the meaning set forth in Section 1.3(a)(xii).

 

“NASD” means the National Association of Securities Dealers, Inc.

 

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

 

“Prospectus” shall
mean the prospectus included in a Shelf Registration Statement, including any
preliminary prospectus, and any such prospectus as amended or supplemented by
any prospectus supplement, including a prospectus supplement with respect to
the terms of the offering of any portion of the Registrable Securities covered
by a Shelf Registration Statement, and by all other amendments and supplements
to a prospectus, including post-effective amendments, and, in each case,
including all documents incorporated by reference therein.

 

 “Registrable Securities” means
the Shares, excluding in all cases, however, (i) any Shares sold by a
person in a transaction in which such person’s rights under this Agreement are
not assigned, (ii) any Shares sold to or through a broker or dealer or
underwriter in a public distribution or a public securities transaction or (iii) any
Shares that may be sold in a single transaction pursuant to Rule 144(k)
under the Securities Act or a similar exemption under the Securities Act.

 

“Rule 144” and “Rule 145” mean
Rule 144 and Rule 145 promulgated under the Securities Act.

 

“Securities Act” means
the Securities Act of 1933, as amended from time to time.

 

“Shelf Registration” shall
mean a registration effected pursuant to Section 1.2(a).

 

“Shelf Registration Statement” shall
mean a “shelf” registration statement of the Company pursuant to the provisions
of Section 1.2 which covers all of the Registrable Securities, on an
appropriate form under Rule 415 under the
Securities Act, or any successor or similar rule that may be adopted
by the Commission, and all amendments and supplements to such registration
statement, including post-effective amendments, in each case including the
Prospectus contained therein, all exhibits thereto and all documents
incorporated by reference therein.

 

“Purchase Agreement” has
the meaning set forth in the Recitals.

 

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“S-3 Eligibility Date”
means the earlier of (i) the first date after the date hereof on which the
Company becomes eligible to file a Registration Statement for a transaction
involving a secondary offering on Form S-3 and (ii) June 1,
2007.

 

“Transfer” means
and includes the act of selling, giving, transferring, creating a trust (voting
or otherwise), assigning or otherwise disposing of (other than pledging,
hypothecating or otherwise transferring as security or any transfer upon any
merger or, consolidation) (and correlative words shall have correlative
meanings); provided,  however, that any transfer or other
disposition upon foreclosure or other exercise of remedies of a secured
creditor after an event of default under or with respect to a pledge,
hypothecation or other transfer as security shall constitute a Transfer.

 

“Violation” has
the meaning set forth in Section 1.4(a).

 

1.2                                 Registration.

 

(a)                                  Registration
Requirement. The Company shall file with the Commission a Shelf
Registration Statement meeting the requirements of the Securities Act within 30
days following the S-3 Eligibility Date, and will use its best efforts to cause
the Shelf Registration Statement to be declared effective by the Commission as
soon as reasonably practicable thereafter and in any event not later than 180
days after the S-3 Eligibility Date. Each Holder agrees to furnish to the
Company all information with respect to such Holder necessary to make the
information set forth in the Shelf Registration Statement or Prospectus not
materially misleading.

 

(b)                                 Effectiveness
Requirement. The Company agrees to use its best efforts to keep the Shelf
Registration Statement continuously effective and the Prospectus usable for
resales for a period commencing on the date that such Shelf Registration
Statement is initially declared effective by the Commission and terminating on
the date when all of the Registrable Securities covered by such Shelf
Registration Statement have been sold pursuant to such Shelf Registration
Statement or cease to be Registrable Securities (the “Effectiveness
Period’); provided, however, the Company is
permitted to suspend sales of the Registrable Securities during any Delay
Period. The Company will be deemed not to have used its best efforts to cause
the Shelf Registration Statement to become, or to remain, effective during the
requisite period if it voluntarily takes any action or omits to take any action
that would result in the Shelf Registration Statement not being declared
effective or that would result in the Holders of Registrable Securities covered
thereby not being able to offer and sell such Registrable Securities during
that period, unless such action or omission is required by applicable law and except
during any Delay Period.

 

(c)                                  Delay
Period. The term “Delay Period” means,
with respect to any obligation to keep any Shelf Registration Statement or
Prospectus usable for resales pursuant to this Section 1.2, the shortest
period of time determined in good faith by the Company’s Board of Directors to
be necessary for such purpose when there exist circumstances relating to a
material pending development, including, but not limited to, a pending or
contemplated material acquisition or merger or other material transaction or
similar event, which would require disclosure by the Company in such Shelf
Registration Statement or Prospectus of material non-

 

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public information which the Company determines in good faith upon the
advice of its counsel that it has a bona fide business
purpose for keeping confidential and non-public and the non-disclosure of which
in such Shelf Registration Statement or Prospectus might cause such Shelf
Registration Statement or Prospectus to fail to comply with applicable
disclosure requirements. A Delay Period shall commence on and include the date
that the Company gives written notice (a “Delay
Notice”) to the Holders that the Prospectus is no longer
usable as a result of a material pending development and shall end on the date
when the Holders are advised in writing by the Company that the current Delay
Period has terminated (it being understood that the Company shall give such
notice to all Holders promptly upon making the determination that the Delay
Period has ended); provided, however, and notwithstanding
anything herein to the contrary the Company is only entitled to four (4) Delay
Periods having durations of not more than 30 days each during any consecutive
12 month period, and not to exceed more than 90 days in the aggregate in any
consecutive 12 month period. The Company covenants and agrees that it will not
deliver a Delay Notice with respect to a Delay Period unless Company officers
and directors and their Affiliates and any other holders of registration rights
with respect to the Company’s Common Stock are also prohibited by the Company
for the duration of such Delay Period from effecting any public sales of shares
of Common Stock beneficially owned by them. The Company represents that it has
no knowledge of any circumstance that would reasonably be expected at the time
of the effectiveness of the Shelf Registration Statement pursuant to Section 1.2(a) to
cause the Company to exercise its rights under this Section 1.2(c). Without
limiting any of the foregoing, but for the purpose of additional clarity, the
Company shall not commence any Delay Period until after the Shelf Registration
Statement is filed with the Commission.

 

(d)                                 Notice.
The Company will, in the event a Shelf Registration Statement is declared
effective, provide to each Holder a reasonable number of copies of the
Prospectus which is a part of such Shelf Registration Statement, notify
each such Holder when such Shelf Registration Statement has become effective
and take such other actions as are required to permit unrestricted resales of
the Registrable Securities. The Company further agrees to supplement or amend
each Shelf Registration Statement if and as required by the rules, regulations
or instructions applicable to the registration form used by the Company
for such Shelf Registration Statement or by the Securities Act or by any other rules and
regulations thereunder for shelf registrations, and the Company agrees to
furnish to the Holders of Registrable Securities copies of any such supplement
or amendment promptly after its being used or filed with the Commission.

 

(e)                                  Liquidated
Damages. If the Shelf Registration Statement is not effective by the 180th
day after the S-3 Eligibility Date, then the Company will pay to each Holder as
liquidated damages and not a penalty, an amount in cash equal to 0.50% of the
purchase price paid for the Shares by each such Holder (pursuant to the
Purchase Agreement) for each 30-day period or part thereof that such Shelf
Registration Statement is not so effective. If a stop order, injunction or
other order or requirement of the Commission or any other governmental agency
or court is imposed or if for any other reason the effectiveness of the Shelf
Registration Statement is suspended, then the Company shall pay liquidated
damages to each Holder, as liquidated damages and not a penalty, an amount in
cash equal to 0.50% of the purchase price paid for the Shares by each such
Holder (pursuant to the Purchase Agreement) for each 30-day period or part thereof
that such Shelf Registration Statement is not so effective. Notwithstanding the
preceding

 

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sentence, the Holders will not be entitled to receive liquidated
damages under this Section 1.2(e) during a Delay Period (subject to
the duration restrictions in Section 1.2(c)). Liquidated damages shall be
deemed to commence accruing on the day on which the event triggering such
liquidated damages occurs. The liquidated damages to be paid to the Holders
pursuant to this Section 1.2(e) shall cease to accrue (i) with
respect to the liquidated damages for failure to have the Shelf Registration
Statement declared effective on or prior to the 180th day after the
S-3 Eligibility Date, on the day after the Holders have received notice from
the Company that the Shelf Registration Statement is declared effective, or (ii) with
respect to the liquidated damages for the suspension of effectiveness of the
Shelf Registration Statement, on the day after the Holders have received notice
from the Company regarding the reinstatement of effectiveness of the Shelf
Registration Statement. Liquidated damages shall be paid to the Holders by wire
transfer in immediately available funds to the accounts designated by the Holders
within two business days of the end of each 30-day period. The parties hereto
agree that the liquidated damages provided for in this Section 1.2(e) constitute
a reasonable estimate of the damages that will be suffered by the Holders by
reason of the failure of the Shelf Registration Statement to be declared
effective and/or to remain effective, as the case may be, in accordance
with this Agreement. The parties hereto agree and acknowledge that the payment
of liquidated damages, pursuant to this Section 1.2(e), will be the
Holders’ sole remedy for any breach by the Company of a provision for which
liquidated damages are available.

 

1.3                                 Registration
Procedures.

 

(a)                                  Obligations
of the Company. In connection with its obligations under Section 1.2
with respect to the Shelf Registration Statement, the Company shall, as
expeditiously as practicable:

 

(i)                                     prepare
and file with the Commission a Shelf Registration Statement as prescribed by Section 1.2(a) within
the relevant time period specified in Section 1.2(a) on a form chosen
by the Company, which form shall (A) be available for the sale of the
Registrable Securities by the selling Holders thereof and (B) comply as to
form in all material respects with the requirements of the applicable form and
include all financial statements required by the Commission to be filed
therewith; the Company shall use its best efforts to cause such Shelf
Registration Statement to become effective and remain effective and the
Prospectus usable for resales in accordance with Section 1.2, subject to
the proviso contained in Section 1.2(b); provided, however,
that, before filing any Shelf Registration Statement or Prospectus or any
amendments or supplements thereto, the Company shall furnish to and afford the
Holders of the Registrable Securities covered by such Shelf Registration
Statement and their counsel a reasonable opportunity to review copies of all
such documents (including copies of any documents to be incorporated by
reference therein and all exhibits thereto) proposed to be filed; and the
Company shall not file any Shelf Registration Statement or Prospectus or any
amendments or supplements thereto in respect of which the Holders must be
afforded an opportunity to review prior to the filing of such document, other
than filings required under the Exchange Act, if the Holders or their counsel
shall reasonably object in a timely manner; and provided  further,
however, the plan of distribution disclosed in the Shelf Registration Statement
shall be substantially in the form attached hereto as Exhibit A,
with such changes as the Holders may reasonably request;

 

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(ii)                                  prepare
and file with the Commission such amendments and post-effective amendments to
the Shelf Registration Statement as may be necessary to keep the Shelf
Registration Statement effective for the Effectiveness Period, subject to the
proviso contained in Section 1.2(b) or as reasonably requested by the
Holders of a majority of Registrable Securities, and cause each Prospectus to
be supplemented, if so determined by the Company or requested by the
Commission, by any required prospectus supplement and as so supplemented to be
filed pursuant to Rule 424 (or any similar provision then in force), under
the Securities Act, respond as soon as reasonably practicable to any comments
received from the Commission with respect to the Shelf Registration Statement,
or any amendment, post-effective amendment or supplement relating thereto, and
comply with the provisions of the Securities Act, the Exchange Act and the rules and
regulations promulgated thereunder applicable to it with respect to the
disposition of all Registrable Securities covered by the Shelf Registration
Statement during the Effectiveness Period in accordance with the intended
method or methods of distribution by the selling Holders thereof described in
this Agreement;

 

(iii)                               register
or qualify the Registrable Securities under all applicable state securities or “blue
sky” laws of such jurisdictions by the time the applicable Shelf Registration
Statement is declared effective by the Commission as any Holder of Registrable
Securities covered by the Shelf Registration Statement shall reasonably request
in writing in advance of such date of effectiveness, and do any and all other
acts and things which may be reasonably necessary or advisable to enable
such Holder to consummate the disposition in each such jurisdiction of such
Registrable Securities owned by such Holder; provided, however,
that the Company shall not be required to (A) qualify as a foreign
corporation or as a dealer in securities in any jurisdiction where it would not
otherwise be required to qualify but for this Section 1.3(a)(iii), (B) file
any general consent to service of process in any jurisdiction where it would
not otherwise be subject to such service of process or (C) subject itself
to any material taxation in any such jurisdiction if it is not then so subject;

 

(iv)                              promptly
(but in any event within one (1) Business Day) notify each Holder of
Registrable Securities and its counsel, and promptly confirm such notice in
writing (A) when the Shelf Registration Statement covering such
Registrable Securities has become effective and when any post-effective
amendments thereto become effective, (B) of any request by the Commission
or any state securities authority for amendments and supplements to such Shelf
Registration Statement or Prospectus or for additional information after such
Shelf Registration Statement has become effective, (C) of the issuance or
threatened issuance by the Commission or any state securities authority of any
stop order suspending the effectiveness of such Shelf Registration Statement or
the qualification of the Registrable Securities in any jurisdiction described
in Section 1.3(a)(iii) or the initiation of any proceedings for that
purpose, (D) if, between the effective date of such Shelf Registration
Statement and the closing of any sale of Registrable Securities covered
thereby, the representations and warranties of the Company contained in the
Purchase Agreement cease to be true and correct, (E) of the happening of
any event or the failure of any event to occur or the discovery of any facts,
during the Effectiveness Period, which makes any statement made in such Shelf
Registration Statement or the related Prospectus untrue in any material respect
or which

 

6

 

causes such Shelf
Registration Statement or Prospectus to omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading and (F) of the reasonable
determination of the Company upon advice of its counsel that a post-effective
amendment to such Shelf Registration Statement would be appropriate;

 

(v)                                 take
best efforts to prevent the entry of any stop order suspending the
effectiveness of any Shelf Registration Statement, or if entered, to obtain the
withdrawal of any such stop order or to avoid the issuance of, or, if issued,
obtain the withdrawal of any suspension of the qualification (or exemption from
qualification) of any of the Registrable Securities for sale in any
jurisdiction at the earliest possible moment;

 

(vi)                              furnish
to each Holder of Registrable Securities included within the coverage of a Shelf
Registration Statement, without charge, a number of conformed copies of the
Shelf Registration Statement relating to such Shelf Registration and any
post-effective amendment thereto (without documents incorporated therein by
reference or exhibits thereto, unless requested) as such Holder may reasonably
request;

 

(vii)                           deliver
to each selling Holder of Registrable without charge, as many copies of the
applicable Prospectus (including each preliminary Prospectus) as such Holder may reasonably
request (it being understood that the Company consents to the use of the
Prospectus by each of the selling Holders of Registrable in connection with the
offering and sale of the Registrable Securities covered by the Prospectus),
such other documents incorporated by reference therein and any exhibits thereto
as such selling Holder may reasonably request in order to facilitate the
disposition of the Registrable Securities by such Holder;

 

(viii)                        cooperate
with the selling Holders of Registrable Securities to facilitate the timely
preparation and delivery of certificates representing Registrable Securities to
be sold and not bearing any restrictive legends and registered in such names as
the selling Holders may reasonably request at least two (2) Business
Days prior to the closing of any sale of Registrable Securities pursuant to the
Shelf Registration Statement relating thereto;

 

(ix)                                as
soon as practicable after the resolution of any matter or event specified in
Sections 1.3(a)(iv)(B), 1.3(a)(iv)(C), 1.3(a)(iv)(E) (subject to the
proviso contained in Section 1.2(b)) and 1.3(a)(iv)(F)), prepare a
supplement or post-effective amendment to the applicable Shelf Registration
Statement or the related Prospectus or any document incorporated therein by
reference or file any other required document so that, as thereafter delivered
to the purchasers of the Registrable Securities, such Prospectus will not
include any untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;

 

(x)                                   a
reasonable time prior to the filing of any document which is to be incorporated
by reference into a Shelf Registration Statement or a Prospectus after the

 

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initial filing of such
Shelf Registration Statement, provide a reasonable number of copies of such
document to the Holders and make such of the representatives of the Company as
shall be reasonably requested by the Holders of Registrable Securities
available for discussion of such document;

 

(xi)                                comply
with all applicable rules and regulations of the Commission so long as any
provision of this Agreement shall be applicable;

 

(xii)                             cooperate
with each seller of Registrable Securities covered by a Shelf Registration
Statement in connection with any filings required to be made with the NASD;

 

(xiii)                          take all
other steps necessary to effect the registration of the Registrable Securities
covered by a Shelf Registration Statement contemplated hereby; and

 

(xiv)                         notwithstanding
any other provision of this Section 1.3, if the Company becomes ineligible
to use the registration form on which the Shelf Registration Statement is
filed and declared effective pursuant to Section 1.2(a), thereby
precluding any Holder from using the related Prospectus, the Company shall use
best efforts to prepare and file either a post effective amendment to the Shelf
Registration Statement to convert such registration statement to, or a new
Shelf Registration Statement on, another registration form which the
Company is eligible to use within thirty (30) days after the date that the
Company becomes ineligible, provided such other registration form shall be
available for the sale of the Registrable Securities by the selling Holders
thereof and such amended or new Shelf Registration Statement shall remain
subject in all respects to the provisions of this Section 1.3.

 

(b)                                 Holders’
Obligations.

 

(i)                                     Each
Holder agrees that, upon receipt of any notice from the Company of the
occurrence of any event specified in Sections 1.3(a)(iv)(B), 1.3(a)(iv)(C),
1.3(a)(iv)(E), 1.3(a)(iv)(F) or any Delay Notice, such Holder will
forthwith discontinue disposition of Registrable Securities pursuant to the
Shelf Registration Statement at issue until such Holder’s receipt of the copies
of the supplemented or amended Prospectus contemplated by Section 1.3(a)(ix) or
until it is advised in writing (the “Advice”) by the Company that the use of the applicable Prospectus may be
resumed, and, if so directed by the Company, such Holder will deliver to the
Company (at the Company’s expense) all copies in such Holder’s possession,
other than permanent file copies then in such Holder’s possession, of the
Prospectus covering such Registrable Securities current at the time of receipt
of such notice.

 

(ii)                                  Each
Holder agrees that the Company may require each seller of Registrable
Securities as to which any registration is being effected to furnish to it such
information regarding such seller as may be required by the staff of the
Commission to be included in the applicable Shelf Registration Statement, the
Company may exclude from such registration the Registrable Securities of
any seller who fails to furnish such

 

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information which is not
otherwise readily available to the Company within ten (10) Business Days
after receiving such request, and the Company shall have no obligation to
register under the Securities Act the Registrable Securities of a seller who so
fails to furnish such information.

 

1.4                                 Indemnification.
In the event any Registrable Securities are included in a Shelf Registration
Statement under this Section 1:

 

(a)                                  To
the fullest extent permitted by law, the Company will indemnify and hold
harmless each Holder, any underwriter (as defined in the Securities Act) for
such Holder and each Person, if any,  who
controls a Holder or underwriter within the meaning of the Securities Act or
the Exchange Act and each officer, director, agent, affiliate and employee of
each Holder, underwriter and controlling Person, against any losses, claims,
damages or liabilities (joint or several) to which they may become subject
under the Securities Act, the Exchange Act or other federal, state or provincial
law, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any of the following
(collectively a “Violation”):  (i) any
untrue statement or alleged untrue statement of a material fact contained in
such Shelf Registration Statement, including any preliminary Prospectus or
final Prospectus contained therein, any document incorporated by reference in
such Shelf Registration Statement or any amendments or supplements thereto, (ii) the
omission or alleged omission to state therein a material fact required to be
stated therein, or necessary to make the statements therein not misleading or (iii) any
violation or alleged violation by the Company of the Securities Act, the
Exchange Act, any state securities law or any rule or regulation.
promulgated under the Securities Act, the Exchange Act or any state or
provincial securities law directly related to, or in connection with, the Shelf
Registration Statement or the related offering; and the Company will pay to a
Holder, underwriter or controlling Person or officer, director, agent,
affiliate or employee of a Holder, underwriter or controlling Person, as
incurred, any legal or other expenses reasonably incurred by them in connection
with investigating or defending any such loss, claim, damage, liability or
action; provided, however, that the indemnity agreement contained
in this Section 1.4(a) does not apply to (x) amounts paid in
settlement of any such loss, claim, damage, liability or action if such settlement
is effected without the consent of the Company, which consent may not be
unreasonably withheld, conditioned or delayed; provided, however,
that the Company will not be liable in any such case to the extent that any
such loss, claim, damage or liability arises out of or is based upon any such
untrue statement or alleged untrue statement or omission or alleged omission
made in a Shelf Registration Statement or final Prospectus or any amendment or
supplement thereto or any related preliminary Prospectus, in reliance upon and
in conformity with written information furnished to the Company by the Holder
specifically for inclusion therein or (y) any untrue statement or alleged
untrue statement of material fact or omission or alleged omission to state therein
a material fact in any preliminary Prospectus, if a copy of the final
Prospectus in which such untrue statement or alleged untrue statement or
omission or alleged omission was corrected was required to be sent or given but
had not been sent or given to such person prior to the settlement of the sale,
so long as the final Prospectus and any amendments or supplements thereto were
provided by the Company to the Indemnified Holder in the requisite quantity and
on a timely basis to permit proper delivery on or prior to the settlement of
the sale. The Company shall notify the Holders promptly of the institution,
threat or assertion of any action, claim, suit, investigation or proceeding of
which the Company is aware in connection with the transactions contemplated by
this Agreement.

 

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(b)                                 To
the fullest extent permitted by law, each Holder, severally and not jointly,
will indemnify and hold harmless the Company, each of its directors, officers,
employees and Affiliates, each Person, if any, who controls the Company within
the meaning of the Securities Act, any underwriter, any other stockholder
selling securities in such Shelf Registration Statement and any controlling
Person of any such underwriter or other stockholder, against any losses,
claims, damages or liabilities (joint or several) to which any of the foregoing
Persons may become subject, under the Securities Act, the Exchange Act or
other federal, state or provincial law, insofar as such losses, claims, damages
or liabilities (or actions in respect thereto) arise out of or are based upon
any Violation, in each case to the extent that such Violation occurs in
reliance upon and in conformity with written information furnished by such
Holder expressly for use in such Shelf Registration Statement, including any
preliminary Prospectus or final Prospectus contained therein or any amendments
or supplements thereto; and such Holder will pay, as incurred, any legal or
other expenses reasonably incurred by any Person intended to be indemnified
pursuant to this Section 1.4(b), in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however,
that the indemnity agreement contained in this Section 1.4(b) does
not apply to amounts paid in settlement of any such loss, claim, damage,
liability or action if such settlement is effected without the consent of such
Holder, which consent may not be unreasonably withheld, conditioned or
delayed; and further provided, that, in no event will any
indemnity under this Section 1.4(b) exceed the net proceeds received
by such Holder from the sale of Registrable Securities giving rise to such
indemnification obligation.

 

(c)                                  Promptly
after receipt by an indemnified party under this Section 1.4 of notice of
the commencement of any action (including any governmental action), such
indemnified party will, if a claim in respect thereof is to be made against any
indemnifying party under this Section 1.4, deliver to the indemnifying
party a written notice of the commencement thereof and the indemnifying party
will have the right to participate in, and, to the extent the indemnifying
party so desires, jointly with any other indemnifying party similarly noticed,
to assume the defense thereof, including the employment of counsel reasonably
satisfactory to the indemnified party, if (i) the indemnifying party
acknowledges its obligation to indemnify the indemnified party for any losses,
damages or liabilities resulting from such claim and provide reasonable
evidence to the indemnified party of its financial ability to satisfy such
obligation; (ii) the claim does not seek to impose any liability or
obligation on the indemnified party other than for money damages; and (iii) the
claim does not relate to the indemnified party’s relationship with its
customers or employees. An indemnified party shall have the right to employ
separate counsel in any such action, claim, suit, investigation or proceeding
and to participate in the defense thereof, but the fees and expenses of such
counsel shall be at the expense of such indemnified party or parties
unless:  (1) the indemnifying party
has agreed in writing to pay such fees and expenses; (2) the indemnifying
party shall have failed promptly to assume the defense of such action, claim,
suit, investigation or proceeding and to employ counsel reasonably satisfactory
to such indemnified party in any such action, claim, suit, investigation or
proceeding; (3) the indemnifying party is not entitled to assume and
control the defense of any such action, claim, suit, investigation or
proceeding pursuant to clauses (ii) or (iii) of the immediately
preceding sentence; or (4) such indemnified party shall have been advised
by counsel that a conflict of interest is likely to exist if the same counsel
were to represent such indemnified party and the indemnifying party (in which
case, if such indemnified party notifies the indemnifying party in writing that
it elects to employ separate counsel at the expense of the

 

10

 

indemnifying party, the indemnifying party shall not have the right to
assume the defense thereof and the reasonable fees and expenses of one separate
counsel for all indemnified parties shall be at the expense of the indemnifying
party).The indemnifying party will not be liable for any settlement of any
action, claim, suit, investigation or proceeding effected without its consent,
which consent may not be unreasonably withheld, conditioned or delayed. No
indemnifying party shall, without the prior written consent of the indemnified
party, consent to entry of any judgment or enter into any settlement which does
not include as an unconditional term thereof the giving by the claimant or
plaintiff to such indemnified party of an unconditional release from all
liability in respect of such claim or litigation. The failure by the
indemnified party to deliver written notice to the indemnifying party within a
reasonable time of the commencement of any such action shall not relieve such indemnifying
party of any obligation or liability to the indemnified party under this Section 1.4,
except (and only) to the extent that such failure shall have prejudiced the
indemnifying party.

 

(d)                                 If
the indemnification provided for in this Section 1.4 is held by a court of
competent jurisdiction to be unavailable to an indemnified party with respect
to any loss, liability, claim, damage or expense referred to therein, then the
indemnifying party, in lieu of indemnifying such indemnified party hereunder, will
contribute to the amount paid or payable by such indemnified party as a result
of such loss, liability, claim, damage or expense in such proportion as is
appropriate to reflect the relative fault of the indemnifying party on the one
hand and of the indemnified party on the other in connection with the
statements or omissions that resulted in such loss, liability, claim, damage or
expense as well as any other relevant equitable considerations; provided,
that, in no event will any contribution by a Holder under this Section 1.4(d) exceed
the net proceeds received by a Holder from the sale of Registrable Securities
giving rise to such indemnification obligation. The relative fault of the
indemnifying party and of the indemnified party will be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission to state a material fact relates to information
supplied by the indemnifying party or by the indemnified party and the parties’
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The parties hereto agree that it would not
be just and equitable if contribution pursuant to this Section 1.4(d) were
determined by pro rata allocation or by any other method of allocation that
does not take into account the equitable considerations referred to in the
immediately preceding sentence. No Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any Person who was not
guilty of such fraudulent misrepresentation. The amount paid or payable by a
party as a result of any loss, liability, claim, damage or expense shall be
deemed to include, subject to the limitations set forth in Section 1.4(c),
any reasonable attorneys’ or other reasonable fees or expenses incurred by such
party in connection with any action, claim, suit, investigation or proceeding
to the extent such party would have been indemnified for such fees or expenses
if the indemnification provided for in this Section was available to such
party in accordance with its terms.

 

(e)                                  The
obligations of the Company and Holders under this Section 1.4 will survive
the completion of any offering of Registrable Securities in the Shelf
Registration Statement under this Section 1 and otherwise.

 

11

 

1.5                                 Reports
Under the Exchange Act.

 

(a)                                  Beginning
on June 1, 2006, the Company shall use all commercially reasonable efforts
to file as and when applicable, on a timely basis, all reports required to be
filed by it under the Exchange Act. If the Company is not required to file
reports pursuant to the Exchange Act, upon the request of any Holder of
Registrable Securities, the Company shall make publicly available the
information specified in subparagraph (c)(2) of Rule 144. The Company
shall take such further action as may be reasonably required from time to
time and as may be within the reasonable control of the Company, to enable
the Holders to Transfer Registrable Securities without registration under the
Securities Act within the limitation of the exemptions provided by Rule 144
or any other exemption from registration. Upon the request of any Holder of
Registrable Securities, the Company will deliver to such Holder a written
statement as to whether it has complied with such requirements and, if not, the
specifics thereof.

 

(b)                                 In
connection with any sale, transfer or other disposition by a Holder of any
Registrable Securities pursuant to Rule 144, the Company shall cooperate
with such Holder to facilitate the timely preparation and delivery of
certificates representing Registrable Securities to be sold and not bearing any
Securities Act legend, and enable certificates for such Registrable Securities
to be for such number of shares and registered in such names as the Holder may reasonably
request at least two (2) business days prior to any sale of Registrable
Securities.

 

(c)                                  So
long as the Shelf Registration Statement is effective covering the resale of
Registrable Securities owned by a Holder, upon the request of the Holder, the
Company will furnish to such Holder, as soon as practicable after it is
available, one copy of (1) its Annual Report to Stockholders (which Annual
Report shall contain financial statements audited in accordance with generally
accepted accounting principles by a national firm of certified public
accountants), (2) its Annual Report on Form 10-K and (3) its
Quarterly Reports on Form 10-Q (the foregoing, in each case, excluding
exhibits).

 

1.6                                 Registration
Expenses. The Company shall bear and pay all expenses incurred in
connection with any registration, filing, or qualification of Registrable
Securities with respect to a Shelf Registration Statement for each selling
Holder, including all registration, exchange listing, accounting, filing and
NASD fees, all fees and expenses of complying with securities or blue sky laws,
all word processing, duplicating and printing expenses, messenger and delivery
expenses, the reasonable fees and disbursements of counsel for the Company, and
of the Company’s independent public accountants and compliance and reasonable
fees and disbursements of one firm of counsel for the Holders. Holders shall be
responsible for any discounts and commissions and taxes of any kind (including
without limitation, transfer taxes) relating to any disposition, sale or
transfer of Registrable Securities.

 

1.7                                 Piggy-Back
Registrations; Other Registrations. If at any time during the
Effectiveness Period there is not an effective Shelf Registration Statement
covering all of the Registrable Securities and the Company shall determine to
prepare and file with the Commission a registration statement relating to an
offering for its own account or the account of others under the Securities Act
of any of its equity securities, other than on Form S-4 or Form S-8
(each as promulgated under the Securities Act) or their then equivalents
relating to equity securities to be issued solely in connection with any acquisition
of any entity or business or equity securities

 

12

 

issuable in connection with the stock option or other employee benefit
plans, then the Company shall send to each Holder a written notice of such determination
and, if within ten (10) days after the date of such notice, any such
Holder shall so request in writing, the Company shall include in such
registration statement all or any part of such Registrable Securities such
Holder requests to be registered, subject to customary underwriter cutbacks
applicable to all holders of registration rights. In no event at any time
before the Shelf Registration Statement becomes effective with respect to the
Shares shall the Company publicly announce or file any other, registration
statement, other than registrations on Form S-8 without the consent of the
Holders of a majority of the Registrable Securities.

 

1.8                                 Assignment
of Rights.

 

(a)                                  Except
as expressly provided in this Section 1.8, the rights of the parties hereto
cannot be assigned and any purported assignment or transfer to the contrary
shall be void ab initio. So long as the terms of this Section 1.8 are
followed, upon written consent of the Company, which consent shall not be
unreasonably withheld, delayed or conditioned, any Holder may assign its
rights under this Agreement to any Person, including, without limitation, an
Affiliate of such Holder, to whom such Holder Transfers any Registrable
Securities or any rights to acquire Registrable Securities so long as such
Transfer is not made pursuant to an effective Registration Statement or
pursuant to Rule 144 or Rule 145 (or any successor provisions) or in
any other manner the effect of which is to cause the Transferred securities to
be freely transferable without regard to the volume and manner of sale
limitations set forth in Rule 144 (or any successor provision) in the
hands of the transferee as of the date of such Transfer.

 

(b)                                 The
nature and extent of any rights assigned shall be as agreed to between the
assigning party and the assignee. No Person may be assigned any rights
under this Agreement unless (i) the Company is given written notice by the
assigning party at the time of such assignment stating the name and address of
the assignee and identifying the securities of the Company as to which the
rights in question are being assigned, (ii) such assignment is exempt from
the registration requirements of the Securities Act, and (iii) and the
assignee agrees in writing to be bound by and subject to the terms and
conditions of this Agreement, including, without limitation, the provisions of
this Section 1.8.

 

2.                                       Miscellaneous
Provisions.

 

2.1                                 Waivers
and Amendments. Any term of this Agreement may be amended and the
observance of any term of this Agreement may be waived (either generally
or in a particular instance and either retroactively or prospectively), only
with the written consent of the Company and each Holder of then outstanding
Registrable Securities. Any amendment or waiver effected in accordance with
this Section 2.1 is binding upon Holders and the Company.

 

2.2                                 Notices.
All notices and other communications required or permitted hereunder must be in
writing and, except as otherwise noted herein, must be addressed as follows:

 

13

 

(a)                                  if
to the Company, to:

 

TRC Companies, Inc.

21 Griffin Road
North

Windsor,
Connecticut 06095

Attention:                 Chief Financial Officer

General Counsel 

Telephone:            (860)
298-9692

Facsimile:                  (860)
298-6291

 

(b)                                 if
to any Holder, at the address shown on such Holders signature page hereto,
marked for attention as there indicated, to:

 

or to such other address as the party to whom notice
is to be given may have furnished to the other in writing in accordance
with the provisions of this Section 2.2. Any such notice or communication
will be deemed to have been received: (i) in the case of telecopy or
personal delivery, on the date of such delivery; (ii) in the case of
nationally-recognized overnight courier, on the next business day after the
date sent; and (iii) if by registered or certified mail, on the third
business day following the date postmarked.

 

2.3                                 Descriptive
Headings and References. The descriptive headings herein have been inserted
for convenience only and are not deemed to limit or otherwise affect the
construction of any provisions hereof Except as otherwise specifically
provided, any reference to any section will be deemed to refer to such section of
this Agreement.

 

2.4                                 GOVERNING
LAW. THE CONSTRUCTION, VALIDITY AND INTERPRETATION OF THIS AGREEMENT WILL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE DOMESTIC LAWS OF THE STATE
OF DELAWARE, WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW OR CONFLICT OF LAW
PROVISION OR RULE (WHETHER OF THE STATE OF DELAWARE OR ANY OTHER JURISDICTION)
THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE
STATE OF DELAWARE.

 

2.5                                 Counterparts.
This Agreement may be executed in one or more counterparts, each of which
is for all purposes deemed to be an original and all of which constitute the
same instrument, but only one of which need be produced.

 

2.6                                 Equitable
Remedies. The Company recognizes and agrees that each Holder of Registrable
Securities will not have an adequate remedy if the Company fails to comply with
the terms and provisions of this Agreement and that damages will not be readily
ascertainable, and the Company expressly agrees that, in the event of such
failure, it shall not oppose an application by any holder of Registrable
Securities or any other Person entitled to the benefits of this Agreement
requiring specific performance of any and all provisions hereof or enjoining
the Company from continuing to commit any such breach of this Agreement.

 

14

 

2.7                                 Successors
and Assigns. Except as otherwise expressly provided in this Agreement, this
Agreement shall benefit and bind the successors, assigns, heirs, executors and
administrators of the parties to this Agreement.

 

2.8                                 Entire
Agreement. This Agreement, together with the Purchase Agreement,
constitutes the full and entire understanding and agreement between the parties
with regard to the subject matter hereof and thereof.

 

2.9                                 Separability;
Severability. Unless expressly provided in this Agreement, the rights of
each Holder under this Agreement are several rights, not rights jointly held
with any other Holders. Any invalidity, illegality or limitation on the
enforceability of this Agreement with respect to any Holder does not affect the
validity, legality or enforceability of this Agreement with respect to .the
other Holders. If any provision of this Agreement is judicially determined to
be invalid, illegal or unenforceable, the validity, legality and enforceability
of the remaining provisions will not be affected or impaired.

 

[signature
pages follow]

 

15

 

IN
WITNESS WHEREOF, the parties have executed this Registration Rights Agreement
on the day and year first set forth above.

 

	
   

  	
  TRC Companies, Inc.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Martin H. Dodd

  	
   

  
	
   

  	
   

  	
  Name: Martin H. Dodd

  	
   

  
	
   

  	
   

  	
  Title: Senior Vice President

  	
   

  

 

16

 

	
   

  	
  FEDERAL PARTNERS, L.P..

  
	
   

  	
  By Ninth Floor Corporation, its
  General 

  Partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Stephen M. Duff

  	
   

  
	
   

  	
  Name:

  	
  Stephen M. Duff

  
	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address for Notice:

  
	
   

  	
  One Rockefeller Plaza, 1st Floor

  
	
   

  	
  New York, New York 10022

  
	
   

  	
  Telephone: (212) 977-3441

  
	
   

  	
  Facsimile: (212) 977-3424

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  With copies to:

  
	
   

  	
  Patterson, Belknap, Webb & Tyler LLP

  
	
   

  	
  1133 Avenue of the Americas

  
	
   

  	
  New York, New York 10036-6710

  
	
   

  	
  Attention: Jeffrey E. La Gueux, Esq.

  
	
   

  	
  Telephone: (212) 336-2684

  
	
   

  	
  Facsimile: (212) 336-2222

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Peter R. Kellogg

  	
   

  
	
   

  	
  Peter R. Kellogg

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Lee I. Kellogg

  	
   

  
	
   

  	
  Lee I. Kellogg

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Charles Kirkland Kellogg

  	
   

  
	
   

  	
  Charles Kirkland Kellogg

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address for Note:

  
	
   

  	
  48 Wall Street, 30th Floor

  
	
   

  	
  New York, NY 1005

  
						

 

17

 

ANNEX A

 

Plan of Distribution

 

Each Selling Stockholder (the “Selling Stockholders”)
of the common stock (“Common Stock”) of TRC Companies, Inc., a
Delaware corporation (the “Company”) and any of their pledgees,
assignees and successors-in-interest may, from time to time, sell any or all of
their shares of Common Stock on the Trading Market or any other stock exchange,
market or trading facility on which the shares are traded or in private
transactions. These sales may be at fixed or negotiated prices. A Selling
Stockholder may use any one or more of the following methods when selling
shares:

 

•                  ordinary brokerage transactions and
transactions in which the broker-dealer solicits purchasers;

 

•                  block trades in which the broker-dealer
will attempt to sell the shares as agent but may position and resell a
portion of the block as principal to facilitate the transaction;

 

•                  purchases by a broker-dealer as
principal and resale by the broker-dealer for its account;

 

•                  an exchange distribution in
accordance with the rules of the applicable exchange;

 

•                  privately negotiated transactions;

 

•                  settlement of short sales entered
into after the date of this prospectus;

 

•                  broker-dealers may agree with
the Selling Stockholders to sell a specified number of such shares at a
stipulated price per share;

 

•                  a combination of any such methods of
sale;

 

•                  through the writing or settlement of
options or other hedging transactions, whether through an options exchange or
otherwise; or

 

•                  any other method permitted pursuant
to applicable law.

 

The Selling Stockholders may also sell shares
under Rule 144 under the Securities Act of 1933, as amended (the “Securities
Act”), if available, rather than under this prospectus.

 

Broker-dealers engaged by the Selling Stockholders may arrange
for other brokers-dealers to participate in sales. Broker-dealers may receive
commissions or discounts from the Selling Stockholders (or, if any broker-dealer
acts as agent for the purchaser of shares, from the purchaser) in amounts to be
negotiated. Each Selling Stockholder does not expect these commissions and
discounts relating to its sales of shares to exceed what is customary in the
types of transactions involved.

 

18

 

In connection with the sale of our common stock or
interests therein, the Selling Stockholders may enter into hedging
transactions with broker-dealers or other financial institutions, which may in
turn engage in short sales of the common stock in the course of hedging the
positions they assume. The Selling Stockholders may also sell shares of
our common stock short and deliver these securities to close out their short
positions, or loan or pledge the common stock to broker-dealers that in turn may sell
these securities. The Selling Stockholders may also enter into option or
other transactions with broker-dealers or other financial institutions or the
creation of one or more derivative securities which require the delivery to
such broker-dealer or other financial institution of shares offered by this
prospectus, which shares such broker-dealer or other financial institution may resell
pursuant to this prospectus (as supplemented or amended to reflect such
transaction).

 

The Selling Stockholders and any broker-dealers or
agents that are involved in selling the shares may be deemed to be “underwriters”
within the meaning of the Securities Act in connection with such sales. In such
event, any commissions received by such broker-dealers or agents and any profit
on the resale of the shares purchased by them may be deemed to be
underwriting commissions or discounts under the Securities Act. Each Selling
Stockholder has informed the Company that it does not have any agreement or
understanding, directly or indirectly, with any person to distribute the Common
Stock.

 

The Company is required to pay certain fees and
expenses incurred by the Company incident to the registration of the shares. The
Company has agreed to indemnify the Selling Stockholders against certain
losses, claims, damages and liabilities, including liabilities under the
Securities Act.

 

Because Selling Stockholders may be deemed to be “underwriters”
within the meaning of the Securities Act, they will be subject to the
prospectus delivery requirements of the Securities Act. In addition, any
securities covered by this prospectus which qualify for sale pursuant to Rule 144
under the Securities Act may be sold under Rule 144 rather than under
this prospectus. Each Selling Stockholder has advised us that they have not
entered into any agreements, understandings or arrangements with any
underwriter or broker-dealer regarding the sale of the resale shares. There is
no underwriter or coordinating broker acting in connection with the proposed
sale of the resale shares by the Selling Stockholders.

 

We agreed to keep this prospectus effective until the
earlier of (i) the date on which the shares may be resold by the
Selling Stockholders without registration and without regard to any volume
limitations by reason of Rule 144(e) under the Securities Act or any
other rule of similar effect or (ii) all of the shares have been sold
pursuant to the prospectus or Rule 144 under the Securities Act or any
other rule of similar effect. The resale shares will be sold only through
registered or licensed brokers or dealers if required under applicable state
securities laws. In addition, in certain states, the resale shares may not
be sold unless they have been registered or qualified for sale in the
applicable state or an exemption from the registration or qualification
requirement is available and is complied with.

 

Under applicable rules and regulations under the
Exchange Act, any person engaged in the distribution of the resale shares may not
simultaneously engage in market making activities with respect to our common
stock for a period of two business days prior to the commencement

 

19

 

of the distribution. In
addition, the Selling Stockholders will be subject to applicable provisions of
the Exchange Act and the rules and regulations thereunder, including
Regulation M, which may limit the timing of purchases and sales of shares
of our common stock by the Selling Stockholders or any other person. We will
make copies of this prospectus available to the Selling Stockholders and have
informed them of the need to deliver a copy of this prospectus to each
purchaser at or prior to the time of the sale.

 

20Exhibit 10.1

 

AMENDMENT
NO. 1 TO

AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

 

This Amendment No. 1 to
Amended and Restated Loan and Security Agreement (this “Amendment”) is dated as of February 21,
2006, is by and among LASALLE BANK NATIONAL ASSOCIATION, for itself as a
lender, and as Agent (“Agent”) for
the lenders (“Lenders”) from time
to time party to the Amended and Restated Loan Agreement (as defined below) and
APAC CUSTOMER SERVICES, INC. (“Borrower”).

 

Preliminary Statements

 

Agent and Borrower are party
to that certain Amended and Restated Loan and Security Agreement dated as of
October 31, 2005 (as amended, restated, supplemented or otherwise modified from
time to time, the “Amended and Restated Loan
Agreement”). Capitalized terms used but not defined in this
Amendment shall have the meanings ascribed to such terms in the Amended and
Restated Loan Agreement.

 

Borrower has requested,
among other things, that Agent amend the Amended and Restated Loan Agreement to
provide for additional borrowing availability pursuant to Section 14(d),
as set forth herein and Agent is willing to do so on the terms and subject to
the conditions set forth herein.

 

NOW, THEREFORE, in
consideration of the foregoing recitals, the mutual covenants and agreements
set forth herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree
as follows:

 

1. Amendment to Amended
and Restated Loan Agreement. In reliance on the representations and warranties
set forth in Section 3 below and subject to the satisfaction of the conditions
set forth in Section 4 below, the Amended and Restated Loan Agreement is hereby
amended as follows:

 

(a)           Section 14(d) of the Amended and Restated Loan Agreement
is hereby amended and restated in its entirety, as follows:

 

(d)           Excess Availability.

 

Borrower
shall at all times maintain Excess Availability of at least S3,000,000;
provided, however, that Borrower need not maintain any such Excess Availability
if on any date (on or after March 31, 2006) the following have been satisfied
(i) no Event of Default has occurred and is continuing on such date, (ii) Agent
has received a copy of Borrower’s 10-K for the Fiscal Year ending on or about
December 31, 2005 by March 31, 2006, and (iii) Agent has received Borrower’s
compliance certificate for the month ending on March 31, 2006 or any applicable
month thereafter. Notwithstanding the foregoing, Agent waives the requirement
for Borrower to maintain Excess Availability of at least Three Million and
No/100 Dollars ($3,000,000.00) from the date of this

 

 

Amendment through April 30,
2006. In the event Borrower fails to meet the requirements set forth herein in
subsections (i), (ii) and (iii) prior to April 30, 2006, then Borrower shall be
required to maintain Excess Availability at all times in excess of at least
Three Million and Noll 00 Dollars (S3,000,000.00) until such time as Borrower
is able to meet such requirements.

 

2.             Representations and Warranties of Borrower.
Borrower represents and warrants that, as of the date hereof:

 

(a)           The execution, delivery and performance by Borrower of
this Amendment, are within the organizational power of Borrower, have been duly
authorized by all necessary action, have received all necessary’ governmental
approval (if any shall be required), other than approvals which could not
reasonably be expected to have a Material Adverse Effect on Borrower, and do
not and will not contravene or conflict with any provision of law applicable to
Borrower, the articles of incorporation, by-laws or any other organizational
document of Borrower, any order, judgment or decree of any court or
governmental agency, or any agreement, instrument or document binding upon
Borrower or any property of Borrower, in each ease, which contravention or
conflict could reasonably be expected to have a Material Adverse Effect on
Borrower;

 

(b)           Each of the Amended and Restated Loan Agreement, as amended by this Amendment and the Other
Agreements to which Borrower is a party are the legal, valid and binding
obligations of Borrower, enforceable against Borrower in accordance with their
respective terms, except as limited
by applicable bankruptcy, insolvency or other laws related to enforcement of
creditor’s rights generally and general principals of equity related to
enforcement;

 

(c)           After giving effect to the amendments set forth herein, no
Event of Default or event or condition which upon notice, lapse of time or both
would constitute an Event of Default has occurred and is continuing; and

 

(d)           After giving effect to the amendments set forth herein,
the representations and warranties of the Borrower contained in the Amended and
Restated Loan Agreement and the Other Agreements are true and accurate as of
the date hereof with the same force and effect as if such had been made on and
as of the date hereof, except for those specific to a past date (which shall be
true and correct as of such past date).

 

3.             Conditions Precedent. The effectiveness of this
Amendment is subject to the satisfaction of the following condition precedent:

 

(a)             Agent shall have received this Amendment executed by
Borrower, Agent and LaSalle Bank National Association;

 

(h)           Agent shall have received the Consent and Reaffirmation
executed by each Obligor (other than the Borrower);

 

2

 

(c)           Borrower shall have paid a legal fee of
Five Hundred and No/lOO ($500.00) for Agent’s internal legal costs to prepare
this Amendment No. 1 to Amended and Restated Loan and Security Agreement; and

 

(d)           All proceedings taken in connection with this Amendment
and all documents, instruments and other legal matters incident thereto shall
be satisfactory to Agent and its legal counsel such acceptance to be evidenced
by Agent’s execution hereof.

 

4.             No Novation. This Amendment is not intended to
nor shall be construed to create a novation or accord and satisfaction with
respect to any of the Liabilities.

 

5.             Severability. Any provision of this Amendment
that is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provision in any other
jurisdiction.

 

6.             Ratification. Except as expressly waived and
modified hereby, the Amended and Restated Loan Agreement and the Other
Agreements are each hereby are
ratified and confirmed by the parties hereto and remain in full force and
effect in accordance with the respective terms thereof. Agent and Lenders
willingness to provide the waivers herein and agree to the amendments herein
shall not be deemed to indicate or require Agent’s or Lenders’ willingness to
agree to any deviation from the terms of the Amended and Restated Loan
Agreement (as modified hereby) in the future.

 

7.             Choice of Law. This Amendment shall be governed
and controlled by the laws of the State of Illinois as to interpretation,
enforcement, validity, construction, effect and in all other respects.

 

[Remainder of page intentionally left blank,
signatures to follow]

 

 

IN WITNESS
WHEREOF, the parties hereto have caused this Amendment to be duly executed
under seal and delivered by their respective duly authorized officers on the
date first written above.

 

	
   

  	
  LASALLE BANK NATIONAL

  
	
   

  	
  ASSOCIATION,
  as Agent and a Lender

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/Andrew J.
  Heinz

  	
   

  
	
   

  	
  Its: 

  	
  First Vice
  President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  APAC CUSTOMER SERVICES, INC.,

  
	
   

  	
  as Borrower

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ George
  H. Hepburn

  	
   

  
	
   

  	
  Its:

  	
  SVP & Chief
  Financial Officer

  	
   

  
									

 

 

CONSENT AND REAFFIRMATION

 

The
undersigned (“Guarantors”), hereby
(i) acknowledge receipt of a copy of the foregoing Amendment No. 1 to Amended
and Restated Loan and Security Agreement (the “Amendment”);
(ii) consent to Borrower’s execution and delivery of the Amendment;
and (iii) reaffirm that each of the Other Agreements that it is a party to
continue to remain in full force and effect. Although Guarantors have been
informed of the matters set forth herein and have acknowledged same, Guarantors
understand that Agent and Lenders have no obligation to inform Guarantors of
such matters in the future or to seek Guarantors’ acknowledgment to future
amendments, waivers or consents, and nothing herein shall create such a duty.

 

IN WITNESS
WHEREOF, Guarantors have executed this Consent and Reaffirmation on and as of
the date of the Amendment.

 

	
   

  	
  APAC
  CUSTOMER SERVICES, L.L.C.

  
	
   

  	
   APAC CUSTOMER SERVICES OF ILLINOIS, INC. 

  
	
   

  	
   APAC CUSTOMER SERVICES GENERAL 

  
	
   

  	
   PARTNER, I1 C.

  
	
   

  	
  ITI
  HOLDINGS, LLC

  
	
   

  	
  APAC
  CUSTOMER SERVICES OF IOWA, L.L.C.

  
	
   

  	
  APAC
  CUSTOMER SERVICES OF TEXAS, L.P.

  
	
   

  	
  by its
  general partner, APAC Customer Services

  
	
   

  	
  General
  Partner, Inc.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ Robert
  J. Keller

  	
   

  
	
   

  	
  Its

  	
  President

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00098-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00098-of-00352.parquet"}]]