Document:

EXHIBIT
10.5

 

FIRST
AMENDMENT TO SUBLEASE

 

(PALACE
STATION)

 

This
First Amendment to Sublease (this “Amendment”), dated as of March 19,
2008, is made by and between STATION CASINOS, INC., a Nevada corporation, (“Sublessor”)
and PALACE STATION HOTEL & CASINO, INC., a Nevada corporation, (“Sublessee”).

 

R E C I T A L S:

 

WHEREAS,
Sublessor and Sublessee are party to that certain Sublease (Palace Station)
dated as of November 7, 2007 (the “Sublease”).  All capitalized terms used herein and not
otherwise defined shall have the meanings set forth in the Sublease;

 

WHEREAS,
Master Landlord and Sublessor have entered into that certain First Amendment to
Master Lease Agreement, dated as of even date herewith (the “Master Lease
Amendment” and the Master Lease, as so amended, the “Amended Master
Lease”), in order to make, among other changes, certain clarifications to Article XI
of the Master Lease with respect to the FF&E Reserve (as defined in the
Master Lease).

 

WHEREAS,
the parties hereto desire to amend the Sublease to make corresponding
clarifications to Section 13 of the Sublease with respect to the Sublease
FF&E Reserve.

 

NOW,
THEREFORE, in consideration of Ten Dollars ($10.00) and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto agree as follows, effective as of the date hereof:

 

1.             Amendment to Sublease. 
Section 13 of the Sublease is amended (x) to amend the third
sentence thereof to read as follows:

 

“Without
limiting the foregoing, Sublesee shall maintain with respect to the Subleased
Property a reserve (the “Sublease FF&E Reserve”) for capital and
FF&E expenditures in an amount equal to (a) 2.5% of (i) gross
revenues derived from operations of the Subleased Property (including, without
limitation, from operations of the hotel and casino components of the Subleased
Property) for the period in question minus (ii) the amount attributable to
“comps” for the Subleased Property during such period (the gross revenues net
of such comps being referred to for purposes of this Section 13 as the “net
revenues”), less (b) any amounts actually expended during such
period by Sublessee or Sublessor on account of FF&E (other than from the
Sublease FF&E Reserve or FF&E Reserve under the Master Lease, it being
understood that amounts expended on account of FF&E from the Sublease
FF&E Reserve or the FF&E Reserve under the Master Lease shall not be
included in any deductions from the Sublease FF&E Reserve deposit
requirements) (the “Required Sublease FF&E Deposit”);
provided that if the amount deducted for a period under clause (b) of this
sentence exceeds the amount that would otherwise be payable into the Sublease
FF&E Reserve under 

 

 

clause (a) of
this sentence for such period, Sublessee may reduce the Required Sublease
FF&E Deposit for the next period by the amount of such excess.”;

 

and (y) by adding the following language after the third
sentence,

 

“On or
before each Sublease Rent Payment Date, Sublessee shall fund or cause to be
funded the Sublease FF&E Reserve based on Sublessee’s good faith estimate
of the Required Sublease FF&E Deposit for the previous month (i.e., Sublessee’s good faith estimate of 2.5% of the net
revenues of the Subleased Property for the previous month minus the amounts
actually expended by Sublessee or Sublessor on account of FF&E during such
month); and concurrently with such funding Sublessee shall provide to Sublessor
a written notice of the amount of such funding. 
Within forty-five days of the end of each Fiscal Quarter, Sublessee
shall furnish Sublessor with information setting forth the actual net revenues
and actual Required Sublease FF&E Deposit of the Subleased Property for
such Fiscal Quarter, including reasonable detail regarding the gross revenues
of the Subleased Property and the comps and actual FF&E expenditures
deducted to arrive at the net revenues and Required Sublease FF&E Deposit
such that Sublessor shall have sufficient information relating to the Subleased
Property to enable Sublessor to deliver the FF&E Certificate under Section 11.1
of the Master Lease (the “FF&E Reserve Certificate”).  With respect to the Subleased Property, if
the amounts deposited into the Sublease FF&E Reserve for a Fiscal Quarter
exceeds the actual Required Sublease FF&E Deposit for the Subleased
Property for such Fiscal Quarter (as set forth in the applicable FF&E
Reserve Certificate), the excess amount shall be applied against the amount to
be funded in the Sublease FF&E Reserve for the following month.  With respect to the Subleased Property, if
the amounts deposited into the Sublease FF&E Reserve for a Fiscal Quarter
are less than the actual Required Sublease FF&E Deposit for the Subleased
Property for such Fiscal Quarter (as set forth in the applicable FF&E
Reserve Certificate), Sublessee shall fund, or cause to be funded, the
difference into the Sublease FF&E Reserve, within five (5) Business
Days of Sublessor delivering the FF&E Reserve Certificate.”

 

2.             Covenants, Representations and Warranties of Sublessor
and Sublessee.

 

2.1.          Each of Sublessor and Sublessee
reaffirms all terms, covenants, representations and warranties (except to the
extent such representations and warranties pertain solely to an earlier date as
set forth in the Sublease) that it made in the Sublease, as amended hereby.  Sublessee further acknowledges and agrees
that (a) the Master Lease has been amended by the Master Lease Agreement,
and (b) the Sublease remains subject and subordinate to the Amended Master
Lease.

 

2.2.          Each of Sublessor and Sublessee
represents and warrants that (a) it has the legal power and authority to
enter into this Amendment without consent or approval by any third party other
than the Landlord’s Lender and this Amendment constitutes its legal, valid and
binding obligation, enforceable against it in accordance with its terms, except
as may be limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws relating to or limiting 

 

2

 

creditors’ rights generally or by
equitable principles affecting enforceability and (b) the execution and
delivery by Sublessor or Sublessee, as applicable, of this Amendment has been
duly authorized by all requisite action on the part of Sublessor or Sublessee,
as applicable, and will not violate any provision of any of the organizational
documents of Sublessor or Sublessee, as applicable.

 

2.3.          Each of Sublessor and Sublessee
represents and warrants that, as of the date hereof, (a) no Default or
Event of Default has occurred and is continuing; (b) no Default or Event
of Default will occur as a result of the execution, delivery and performance by
Sublessor or Sublessee of this Amendment; and (c) neither Sublessor nor
Sublessee has given any notice of any uncured Default under the Sublease.

 

3.             Effect Upon Sublease.

 

3.1.          Except as specifically set forth
herein, the Sublease shall remain in full force and effect and is hereby
ratified and confirmed.

 

3.2.          The parties hereto specifically
acknowledge and agree that the Sublease, as hereby amended, is in full force
and effect in accordance with its respective terms and has not been modified,
except pursuant to this Amendment.

 

3.3.          A breach of any of the
representations and warranties made herein shall constitute a Default under the
Sublease, subject to the notice and cure provisions provided therein.

 

4.             Governing Law. THIS AMENDMENT SHALL BE CONSTRUED, INTERPRETED AND
GOVERNED BY THE LAW OF THE STATE OF NEVADA.

 

5.             Counterparts.  This
Amendment may be executed in any number of counterparts, and all such counterparts
shall together constitute the same agreement.

 

[Remainder of page left intentionally blank]

 

3

 

IN
WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
as of the day and year first above written.

 

 

	
   

  	
  SUBLESSOR:

  
	
   

  	
   

  
	
   

  	
  STATION CASINOS, INC.,

  
	
   

  	
  a Nevada corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Thomas M. Friel

  
	
   

  	
   

  	
  Name: Thomas M. Friel

  
	
   

  	
   

  	
  Title:

  	
  Executive Vice President, Chief 

  Accounting Officer & Treasurer

  

 

 

	
   

  	
  SUBLESSEE:

  
	
   

  	
   

  
	
   

  	
  PALACE STATION HOTEL &
  CASINO, INC.,

  
	
   

  	
  a Nevada corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Thomas M. Friel

  
	
   

  	
   

  	
  Name: Thomas M. Friel

  
	
   

  	
   

  	
  Title: Senior Vice President and Treasurer

  

 

 

Landlord’s
Lender hereby consents to this Amendment as of the date hereof.

 

 

	
   

  	
  GERMAN AMERICAN CAPITAL

  CORPORATION, a Maryland corporation, in its 

  capacity as Mortgage Lender, First Mezzanine 

  Lender, Second Mezzanine Lender, Third 

  Mezzanine Lender, and Fourth Mezzanine Lender, 

  under Landlord’s Loan Documents

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John K. Beacham

  
	
   

  	
   

  	
  Name: John K. Beacham

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jeffrey E. Paige

  
	
   

  	
   

  	
  Name: Jeffrey E. Paige

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  JPMORGAN CHASE BANK, N.A., a
  national 

  banking association, in its capacity as Mortgage 

  Lender, First Mezzanine Lender, Second Mezzanine 

  Lender, Third Mezzanine Lender and Fourth 

  Mezzanine Lender under Landlord’s Loan 

  Documents

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael Mesard

  
	
   

  	
   

  	
  Name: Michael Mesard

  
	
   

  	
   

  	
  Title: Executive DirectorQuickLinks
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Exhibit 10.20    
    

 
 

CREDIT AGREEMENT    
    

Dated
as of April 10, 2008

among 

SUMMER INFANT, INC.,

SUMMER INFANT (USA), INC.,

SUMMER INFANT EUROPE LIMITED,

SUMMER INFANT ASIA LIMITED,

SUMMER INFANT CANADA, LIMITED,

as Borrowers,
 BANK OF AMERICA, N.A.,

as Administrative Agent, Swing Line Lender and L/C Issuer,

and

The Other Lenders Party Hereto 

  

  TABLE OF CONTENTS  

	Section
	 	 
	 	Page

	ARTICLE I.    DEFINITIONS AND ACCOUNTING TERMS	 	1
	 	1.01	 	Defined Terms	 	1
	 	1.02	 	Other Interpretive Provisions	 	22
	 	1.03	 	Accounting Terms	 	23
	 	1.04	 	Rounding	 	23
	 	1.05	 	Times of Day	 	23
	 	1.06	 	Letter of Credit Amounts	 	23
	

ARTICLE II.    THE COMMITMENTS AND CREDIT EXTENSIONS	
 	

24
	 	2.01	 	Committed Loans	 	24
	 	2.02	 	Borrowings, Conversions and Continuations of Committed Loans	 	24
	 	2.03	 	Letters of Credit	 	26
	 	2.04	 	Swing Line Loans	 	33
	 	2.05	 	Prepayments	 	35
	 	2.06	 	Termination or Reduction of Commitments; Early Termination Fee	 	37
	 	2.07	 	Repayment of Principal	 	38
	 	2.08	 	Interest	 	38
	 	2.09	 	Fees	 	39
	 	2.10	 	Computation of Interest and Fees; Retroactive Adjustments of Applicable Rate	 	39
	 	2.11	 	Evidence of Debt	 	40
	 	2.12	 	Payments Generally; Agent's Clawback	 	40
	 	2.13	 	Sharing of Payments	 	42
	

ARTICLE III.    TAXES, YIELD PROTECTION AND ILLEGALITY	
 	

42
	 	3.01	 	Taxes	 	42
	 	3.02	 	Illegality	 	43
	 	3.03	 	Inability to Determine Rates	 	43
	 	3.04	 	Increased Costs	 	44
	 	3.05	 	Compensation for Losses	 	45
	 	3.06	 	Mitigation Obligations	 	45
	 	3.07	 	Survival	 	45
	

ARTICLE IV.    CONDITIONS PRECEDENT TO CREDIT EXTENSIONS	
 	

46
	 	4.01	 	Conditions of Initial Credit Extension	 	46
	 	4.02	 	Conditions to all Credit Extensions	 	48
	 	4.03	 	Conditions to Credit Extension for Kiddopotamus Merger	 	48
	

ARTICLE V.    REPRESENTATIONS AND WARRANTIES	
 	

50
	 	5.01	 	Existence, Qualification and Power	 	50
	 	5.02	 	Authorization; No Contravention	 	50
	 	5.03	 	Governmental Authorization; Other Consents	 	50
	 	5.04	 	Binding Effect	 	50
	 	5.05	 	Financial Statements; No Material Adverse Effect	 	50
	 	5.06	 	Litigation	 	51
	 	5.07	 	No Default	 	51
	 	5.08	 	Ownership of Property; Liens	 	51
	 	5.09	 	Environmental Compliance	 	51
	 	5.10	 	Insurance	 	51
	 	5.11	 	Taxes	 	51
	 	5.12	 	ERISA Compliance	 	52
	 	5.13	 	Subsidiaries	 	52
	 	5.14	 	Margin Regulations; Investment Company Act	 	52

	 	5.15	 	Disclosure	 	52
	 	5.16	 	Compliance with Laws	 	53
	 	5.17	 	Taxpayer Identification Number	 	53
	 	5.18	 	Intellectual Property; Licenses, Etc	 	53
	 	5.19	 	Rights in Collateral; Priority of Liens	 	53
	

ARTICLE VI.    AFFIRMATIVE COVENANTS	
 	

53
	 	6.01	 	Financial Statements	 	53
	 	6.02	 	Certificates; Other Information	 	55
	 	6.03	 	Notices	 	56
	 	6.04	 	Payment of Obligations	 	57
	 	6.05	 	Preservation of Existence, Etc	 	57
	 	6.06	 	Maintenance of Properties	 	57
	 	6.07	 	Maintenance of Insurance	 	57
	 	6.08	 	Compliance with Laws	 	57
	 	6.09	 	Books and Records	 	57
	 	6.10	 	Inspection Rights	 	57
	 	6.11	 	Use of Proceeds	 	58
	 	6.12	 	Financial Covenants	 	58
	 	6.13	 	Guarantors	 	58
	 	6.14	 	Collateral Records	 	58
	 	6.15	 	Security Interests	 	58
	 	6.16	 	Maintenance of Swap Contract	 	58
	

ARTICLE VII.    NEGATIVE COVENANTS	
 	

59
	 	7.01	 	Liens	 	59
	 	7.02	 	Investments	 	59
	 	7.03	 	Indebtedness	 	60
	 	7.04	 	Fundamental Changes	 	60
	 	7.05	 	Dispositions	 	61
	 	7.06	 	Restricted Payments	 	61
	 	7.07	 	Change in Nature of Business	 	61
	 	7.08	 	Transactions with Affiliates	 	61
	 	7.09	 	Burdensome Agreements	 	61
	 	7.10	 	Use of Proceeds	 	62
	

ARTICLE VIII.    EVENTS OF DEFAULT AND REMEDIES	
 	

62
	 	8.01	 	Events of Default	 	62
	 	8.02	 	Remedies Upon Event of Default	 	64
	 	8.03	 	Application of Funds	 	64
	

ARTICLE IX.    ADMINISTRATIVE AGENT	
 	

65
	 	9.01	 	Appointment and Authorization of Administrative Agent	 	65
	 	9.02	 	Rights as a Lender	 	65
	 	9.03	 	Exculpatory Provisions	 	65
	 	9.04	 	Reliance by Administrative Agent	 	66
	 	9.05	 	Delegation of Duties	 	66
	 	9.06	 	Resignation of Agent	 	66
	 	9.07	 	Non-Reliance on Agent and Other Lenders	 	67
	 	9.08	 	No Other Duties, Etc	 	67
	 	9.09	 	Administrative Agent May File Proofs of Claim	 	67
	 	9.10	 	Collateral Matters	 	68

	

ARTICLE X.    MISCELLANEOUS	
 	

69
	 	10.01	 	Amendments	 	69
	 	10.02	 	Notices; Effectiveness; Electronic Communications	 	70
	 	10.03	 	No Waiver; Cumulative Remedies	 	72
	 	10.04	 	Expenses; Indemnity; Damage Waiver	 	72
	 	10.05	 	Payments Set Aside	 	74
	 	10.06	 	Successors and Assigns	 	74
	 	10.07	 	Treatment of Certain Information; Confidentiality	 	78
	 	10.08	 	Right of Setoff	 	78
	 	10.09	 	Interest Rate Limitation	 	79
	 	10.10	 	Counterparts; Integration; Effectiveness	 	79
	 	10.11	 	Survival of Representations and Warranties	 	79
	 	10.12	 	Severability	 	79
	 	10.13	 	Governing Law; Jurisdiction; Etc	 	80
	 	10.14	 	Waiver of Jury Trial	 	80
	 	10.15	 	No Advisory or Fiduciary Responsibility	 	81
	 	10.16	 	USA PATRIOT Act Notice	 	81
	
SCHEDULES	
 	

 
	 	2.01	 	Commitments and Applicable Percentages	 	 
	 	5.06	 	Litigation	 	 
	 	5.09	 	Environmental Matters	 	 
	 	5.13	 	Subsidiaries and Other Equity Investments	 	 
	 	7.01	 	Existing Liens	 	 
	 	7.03	 	Existing Indebtedness	 	 
	 	10.02	 	Administrative Agent's Office, Certain Addresses for Notices	 	 
	
 EXHIBITS	
 	

 	
 	

 
	 	A	 	Committed Loan Notice	 	 
	 	B	 	Swing Line Loan Notice	 	 
	 	C	 	Note	 	 
	 	D	 	Compliance Certificate	 	 
	 	E	 	Assignment and Assumption	 	 
	 	F	 	Borrowing Base Certificate	 	 

 

 
 

CREDIT AGREEMENT    
    

        THIS CREDIT AGREEMENT (this "Agreement") is entered into as of
April 10, 2008, among SUMMER INFANT, INC., a Delaware corporation ("SI Holdings"), SUMMER INFANT (USA), INC., a Rhode Island
corporation ("SI USA"), SUMMER INFANT EUROPE LIMITED, a private company limited by shares organized under the laws of England and Wales with registered
number 04322137 ("SI Europe"), SUMMER INFANT ASIA LIMITED, a Hong Kong corporation ("SI Asia"),
and SUMMER INFANT CANADA, LIMITED, a corporation organized under the laws of the Province of New Brunswick, Canada ("SI Canada", and collectively with
SI Holdings, SI USA, SI Europe and SI Asia, the "Borrowers" and each individually a "Borrower"), each
lender from time to time party hereto (collectively, "Lenders" and each individually, a "Lender"), and
BANK OF AMERICA, N.A., a national banking association as Administrative Agent, Swing Line Lender and L/C Issuer. 

        Borrowers
have requested that Lenders provide a revolving credit facility and other financial accommodations, and Lenders are willing to do so on the terms and conditions set forth
herein. In consideration of the mutual covenants and agreements herein contained, the parties hereto covenant and agree as follows: 

 
 

ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS    
    

        1.01    Defined Terms.    As used in this Agreement, the following
terms shall have the meanings set forth below: 

        "Acquisition Credit Availability Period" means the period from and including the Closing Date to the earliest of (a) the date which
is one (1) year after the Closing Date, and (b) the date of termination of the Aggregate Acquisition Credit Commitments or the Aggregate Commitments pursuant to  Section 2.06. 

        "Acquisition Credit Commitment" means, as to each Acquisition Credit Lender, its obligation to make Committed Acquisition Credit Loans to
Borrowers pursuant to Section 2.01(b), in an aggregate principal amount at one time outstanding not to exceed the amount set forth opposite such
Acquisition Credit
Lender's name on Schedule 2.01 or in the Assignment and Assumption pursuant to which such Acquisition Credit Lender becomes a party hereto, as
applicable, as such amount may be adjusted from time to time in accordance with this Agreement. 

        "Acquisition Credit Lender(s)" means, at any time, any Lender(s) that has/have an Acquisition Credit Commitment at such time. 

        "Acquisition Credit Loan" means an extension of credit by an Acquisition Credit Lender to Borrowers under  Section 2.01(b) in the form of a Committed Acquisition
Credit Loan. 

        "Administrative Agent" or "Agent" means Bank of America, in its capacity as administrative
agent under this Agreement and any of the other Loan Documents, or any successor administrative agent. 

        "Administrative Agent's Office" means Agent's address and, as appropriate, account as set forth on  Schedule 10.02, or such other address or account as Agent may
from time to time notify Borrowers and Lenders. 

        "Administrative Questionnaire" means an Administrative Questionnaire in a form supplied by Agent. 

        "Affiliate" means, with respect to any Person, another Person that directly, or indirectly through one or more intermediaries, Controls or
is Controlled by or is under common Control with the Person specified. 

        "Agent Fee Letter" has the meaning specified in Section 2.09(b). 

        "Agent Parties" has the meaning specified in Section 10.02(c). 

        "Aggregate Acquisition Credit Commitments" means the Acquisition Credit Commitments of all Acquisition Credit Lenders, which shall not
exceed $10,000,000 in the aggregate at any one time. 

 

        "Aggregate Commitments" means the Commitments of all Lenders, which shall not exceed $46,000,000 in the aggregate at any one time,  provided, however, that if the ratio of Borrowers' Funded Debt to EBITDA for any fiscal quarter exceeds
3.25:1.00, the Aggregate Commitments shall be limited to the sum of the then current Borrowing Base Availability plus the then current Overadvance
Amount until such time as the Borrowers deliver an updated Compliance Certificate pursuant to Section 6.01(d) showing a reduction of the ratio of
Funded Debt to EBITDA to a level below 3.25:1.00; and provided, further, that if the ratio of Borrowers'
Funded Debt to EBITDA for the fiscal year ending December 31, 2008 exceeds 3.25:1.00, the Aggregate Commitments shall permanently reduce by $4,000,000 as of March 31, 2009. 

        "Aggregate Revolving Credit Commitments" means the Revolving Credit Commitments of all Revolving Credit Lenders. 

        "Agreement" means this Credit Agreement, as may be amended, restated, supplemented, extended, replaced or otherwise modified from time to
time. 

        "Applicable Acquisition Credit Percentage" means with respect to any Acquisition Credit Lender at any time, the percentage (carried out to
the ninth decimal place) of the Aggregate Acquisition Credit Commitments represented by such Acquisition Credit Lender's Acquisition Credit Commitment at such time. If the commitment of each
Acquisition Credit Lender to make Loans has been terminated pursuant to Section 8.02 or if the Aggregate Acquisition Commitments have expired,
then the Applicable Acquisition Credit Percentage of each Acquisition Credit Lender shall be determined based on the Applicable Acquisition Credit Percentage of such Acquisition Credit Lender most
recently in effect, giving effect to any subsequent assignments. The initial Applicable Acquisition Credit Percentage of each Acquisition Credit Lender is set forth opposite the name of such
Acquisition Credit Lender on Schedule 2.01 or in the Assignment and Assumption pursuant to which such Acquisition Credit Lender becomes a party
hereto, as applicable. 

        "Applicable Percentage" means with respect to any Lender at any time, the percentage (carried out to the ninth decimal place) of the
Aggregate Commitments represented by such Lender's Commitment at such time. If the commitment of each Lender to make Loans and the obligation of the L/C Issuer to make L/C Credit Extensions have been
terminated pursuant to Section 8.02 or if the Aggregate Commitments have expired, then the Applicable Percentage of each Lender shall be
determined based on the Applicable Percentage of such Lender most recently in effect, giving effect to any subsequent assignments. The initial Applicable Percentage of each Lender is set forth
opposite the name of such Lender on Schedule 2.01 or in the Assignment and Assumption pursuant to which such Lender becomes a party hereto, as
applicable. 

        "Applicable Revolving Credit Percentage" means with respect to any Revolving Credit Lender at any time, the percentage (carried out to the
ninth decimal place) of the Aggregate Revolving Credit Commitments represented by such Revolving Credit Lender's Revolving Credit Commitment at such time. If the commitment of each Revolving Credit
Lender to make Revolving Credit Loans and the obligation of the L/C Issuer to make L/C Credit Extensions have been terminated pursuant to  Section 8.02 or if the Aggregate Revolving Credit
Commitments have expired, then the Applicable Revolving Credit Percentage of each Revolving
Credit Lender shall be determined based on the Applicable Revolving Credit Percentage of such Revolving Credit Lender most recently in effect, giving effect to any subsequent assignments. The initial
Applicable Revolving Credit Percentage of each Revolving Credit Lender is set forth opposite the name of such Revolving Credit Lender on  Schedule 2.01 or in the Assignment and Assumption pursuant
to which such Revolving Credit Lender becomes a party hereto, as applicable. 

2

 

        "Applicable Rate" means, from time to time, the following percentages per annum, based upon the Funded Debt to EBITDA Ratio (the
"Financial Covenant") as set forth in the most recent Compliance Certificate received by Agent pursuant to  Section 6.02(b): 

 
 

Applicable Rate    
    

	Pricing Level
	 	Funded Debt to

EBITDA Ratio
	 	Applicable Rate

for Eurodollar

Rate Loans
	 	Applicable Rate

For Base Rate

Loans

	1	 	£2.75:1.00	 	1.50%	 	-0-
	2	 	>2.75:1.00 but £3.25:1.00	 	1.75%	 	0.25%
	3	 	>3.25:1.00	 	2.00%	 	0.50%

        Any
increase or decrease in the Applicable Rate resulting from a change in the Financial Covenant shall become effective as of the first Business Day of the month immediately following
the date a Compliance Certificate is delivered pursuant to Section 6.02(b); provided,  however, that if
a Compliance Certificate is not delivered when due in accordance with such Section, then Pricing Level 3 shall apply as of the
first Business Day of the month following the date such Compliance Certificate was required to have been delivered. The Applicable Rate in effect from the Closing Date through June 30, 2008
shall be determined based upon Pricing Level 3. 

        Notwithstanding
anything to the contrary contained in this definition, (i) the determination of the Applicable Rate for any period shall be subject to the provisions of  Section 2.10(b); and (ii) at any
time the Borrowers' Funded Debt to EBITDA ratio exceeds 3.25:1.00 and the Aggregate Commitments are
calculated using the Overadvance Amount, the Applicable Rate set forth in this definition shall increase by one quarter of one percent (0.25%) for the longer of (A) ninety (90) days from
the date that the Aggregate Commitments began to be calculated using the Overadvance Amount; or (B) the delivery of a Borrowing Base Certificate which shows that such overadvance has been
eliminated. 

        "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. 

        "Assignee Group" means two or more Eligible Assignees that are Affiliates of one another or two or more Approved Funds managed by the same
investment advisor. 

        "Assignment and Assumption" means an assignment and assumption entered into by a Lender and an assignee (with the consent of any party
whose consent is required by Section 10.06(b)), and accepted by Agent, in substantially the form of  Exhibit E or any other form approved by
Agent. 

        "Attributable Indebtedness" means, on any date, (a) in respect of any capital lease of any Person, the capitalized amount thereof
that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP, and (b) in respect of any Synthetic Lease Obligation, the capitalized amount of the
remaining lease payments under the relevant lease that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP if such lease were accounted for as a capital
lease. 

        "Audited Financial Statements" means the audited consolidated and consolidating balance sheet of Borrowers and their Subsidiaries for the
fiscal year ended December 31, 2006, and the related consolidated statements of income or operations, shareholders' equity and cash flows for such fiscal year of Borrowers and their
Subsidiaries, including the notes thereto. 

        "Auto-Reinstatement Letter of Credit" has the meaning specified in  Section 2.03(b)(v). 

        "Availability Period" means the Revolving Credit Availability Period and/or the Acquisition Credit Availability Period, as applicable. 

3

 

        "Bank of America" means Bank of America, N.A., a national banking association, and its successors. 

        "Base Rate" means for any day a fluctuating rate per annum equal to the higher of (a) the Federal Funds Rate plus
1/2 of 1% and (b) the rate of interest in effect for such day as publicly announced from time to time by Bank of America as its "prime rate." The "prime rate" is a rate set by
Bank of America based upon various factors including Bank of America's costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans,
which may be priced at, above, or below such announced rate. Any change in such rate announced by Bank of America shall take effect at the opening of business on the day specified in the public
announcement of such change. 

        "Base Rate Committed Loan" means a Committed Loan that is a Base Rate Loan. 

        "Base Rate Loan" means a Loan that bears interest based on the Base Rate. 

        "Basic Comfort Acquisition" means the Acquisition of the Basic Comfort Assets in accordance with the terms of the Basic Comfort Purchase
Agreement. 

        "Basic Comfort Assets" means the Purchased Assets as that term is described and defined in the Basic Comfort Purchase Agreement. 

        "Basic Comfort Earn Out" means those earn-out payments due to Basic Comfort Seller from SI USA pursuant to the terms of the
Basic Comfort Purchase Agreement in an amount calculated pursuant to Section 1.5 of the Basic Comfort Purchase Agreement. 

        "Basic Comfort Purchase Agreement" means that certain Asset Purchase Agreement dated as of March 25, 2008, by and between Basic
Comfort Seller, as seller, John D. Lord and Belinda S. Lord, as stockholders in the Seller, and SI USA, as buyer, as amended from time to time, in form and substance reasonably satisfactory to Agent. 

        "Basic Comfort Seller" means Basic Comfort, Inc., a Colorado corporation. 

        "Basic Fixed Charge Coverage Ratio" means the ratio of (a) the sum of EBITDA plus
lease expense and rent expense, minus income tax, unfinanced capital expenditures, dividends, withdrawals, and other distributions, to (b) the
sum of interest expense, lease expense, rent expense, the current portion of long term liabilities and the current portion of capitalized lease obligations. 

        "Borrower(s)" has the meaning specified in the introductory paragraph hereto. 

        "Borrower Materials" has the meaning specified in Section 6.02. 

        "Borrowing" means a Committed Borrowing or a Swing Line Borrowing, as the context may require. 

        "Borrowing Base Availability" means an amount which shall not exceed the aggregate Dollar Equivalent of (i) eighty-five
percent (85%) of Total Eligible Toys R Us Receivables outstanding from time to time, plus (ii) eighty-five percent (85%) of Total
Eligible Target Receivables outstanding from time to time, plus (iii) eighty percent (80%) of Eligible Domestic Receivables outstanding from time
to time; plus (iv) sixty percent (60%) of the value of Eligible Domestic Inventory; plus
(v) fifty percent (50%) of the value of Eligible Foreign Inventory; plus (vi) fifty-five percent (55%) of the value of
Intransit Inventory; plus (vii) sixty percent (60%) of Eligible Foreign
Receivables outstanding from time to time; provided, however, the amount available for Loans against
Eligible Domestic Inventory, Intransit Inventory and Eligible Foreign Inventory shall not exceed the lesser of (A) fifty percent (50%) of Borrowing Base Availability under (i) through
(vii) above, and (B) Twenty-Three Million Dollars ($23,000,000). 

        "Borrowing Base Certificate" means a certificate substantially in the form of  Exhibit F. 

4

 

        "Business Day" means any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close under the Laws
of, or are in fact closed in, the state where Administrative Agent's Office is located and, if such day relates to any Eurodollar Rate Loan, means any such day on which dealings in Dollar deposits are
conducted by and between banks in the London interbank eurodollar market. 

        "Canadian Dollars" means the lawful currency of Canada. 

        "Cash Collateralize" has the meaning specified in Section 2.03(g). 

        "Cash Equivalents" means any of the following types of Investments, to the extent owned by a Borrower or any Subsidiary free and clear of
all Liens (other than Liens created under the Collateral Documents and other Liens permitted hereunder): 

	(a)
	readily
marketable obligations issued or directly and fully guaranteed or insured by the United States of America or any agency or instrumentality thereof having maturities of not
more than 360 days from the date of acquisition thereof; provided that the full faith and credit of the United States of America is pledged in support thereof;

	(b)
	time
deposits with, or insured certificates of deposit or bankers' acceptances of, any commercial bank that (i) (A) is a Lender or (B) is organized under the laws of the
United States of America, any state thereof or the District of Columbia or is the principal banking subsidiary of a bank holding company organized under the laws of the United States of America, any
state thereof or the District of Columbia, and is a member of the Federal Reserve System, (ii) issues (or the parent of which issues) commercial paper rated as described in clause (c) of
this definition and (iii) has combined capital and surplus of at least $1,000,000,000, in each case with maturities of not more than 90 days from the date of acquisition thereof;

	(c)
	commercial
paper issued by any Person organized under the laws of any state of the United States of America and rated at least "Prime-1" (or the then equivalent grade) by
Moody's or at least "A-1" (or the then equivalent grade) by S&P, in each case with maturities of not more than 180 days from the date of acquisition thereof; and

	(d)
	Investments,
classified in accordance with GAAP as current assets of the Borrower or any of its Subsidiaries, in money market investment programs registered under the Investment
Company Act of 1940, which are administered by financial institutions that have the highest rating obtainable from either Moody's or S&P, and the portfolios of which are limited solely to Investments
of the character, quality and maturity described in clauses (a), (b) and (c) of this definition. 

        "Change in Law" means the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect
of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation or application thereof by any Governmental Authority or
(c) the making or issuance of any request, guideline or directive (whether or not having the force of law) by any Governmental Authority. 

        "Change of Control" means, with respect to any Person, an event or series of events by which there occurs a direct or indirect transfer of
any Equity Interests in such Person by any of such Person's present shareholders or a direct or indirect dissolution of the percentage Equity Interests in such Person currently held by any present
shareholder without the prior written consent of Agent. 

        "Closing Date" means the first date all the conditions precedent in Section 4.01
are satisfied or waived in accordance with Section 10.01. 

        "Code" means the Internal Revenue Code of 1986. 

5

 

        "Collateral" shall mean any and all assets and rights and interests in or to property of each Pledging Borrower and each of the other Loan
Parties, whether real or personal, tangible or intangible, in which a Lien is granted or purported to be granted pursuant to the Collateral Documents, including, without limitation, the Security
Agreement, the IP Security Agreements and the Mortgage. 

        "Collateral Documents" means all agreements, instruments and documents now or hereafter executed and delivered in connection with this
Agreement pursuant to which Liens are granted or purported to be granted to Agent in Collateral securing all or part of the Obligations each in form and substance satisfactory to Agent, and each as
may be amended, restated, extended, replaced or otherwise modified from time to time. 

        "Committed Acquisition Credit Borrowing" means a borrowing consisting of simultaneous Committed Acquisition Credit Loans of the same type
and, in the case of Eurodollar Rate Loans, having the same Interest Period made by each of the Acquisition Credit Lenders pursuant to  Section 2.01(b). 

        "Committed Acquisition Credit Loan" has the meaning specified in Section 2.01(b). 

        "Committed Borrowing" means a Committed Revolving Credit Borrowing or a Committed Acquisition Credit Borrowing, as the context requires. 

        "Committed Loan" means either a Committed Revolving Credit Loan or a Committed Acquisition Credit Loan. 

        "Committed Loan Notice" means a notice of (a) a Committed Borrowing, (b) a conversion of Committed Loans from one Type to
the other, or (c) a continuation of Eurodollar Rate Loans, pursuant to Section 2.02(a), which, if in writing, shall be substantially in
the form of Exhibit A. 

        "Committed Revolving Credit Borrowing" means a borrowing consisting of simultaneous Committed Revolving Credit Loans of the same Type and,
in the case of Eurodollar Rate Loans, having the same Interest Period made by each of the Revolving Credit Lenders pursuant to Section 2.01(a). 

        "Committed Revolving Credit Loan" has the meaning specified in Section 2.01(a). 

        "Commitment(s)" means, collectively, the Acquisition Credit Commitment and the Revolving Credit Commitment. 

        "Compliance Certificate" means a certificate substantially in the form of  Exhibit D. 

        "Contractual Obligation" means, as to any Person, any provision of any security issued by such Person or of any agreement, instrument or
other undertaking to which such Person is a party or by which it or any of its property is bound. 

        "Control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a
Person, whether through the ability to exercise voting power, by contract or otherwise. "Controlling" and
"Controlled" have meanings correlative thereto. 

        "Credit Extension" means each of the following: (a) a Borrowing and (b) an L/C Credit Extension. 

        "Customer" means a party indebted or obligated to a Borrower or a party against which a Borrower has a claim on a Receivable. 

        "Debtor Relief Laws" means the Bankruptcy Code of the United States, and all other liquidation, conservatorship, bankruptcy, assignment
for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States or other applicable jurisdictions from time to
time in effect and affecting the rights of creditors generally. 

6

 

  
        "Default" means any event or condition that constitutes an Event of Default or that, with the giving of any notice, the passage of time,
or both, would be an Event of Default. 

        "Default Rate" means (a) when used with respect to Obligations other than L/C Fees an interest rate equal to (i) the Base
Rate plus (ii) the Applicable Rate, if any, applicable to Base Rate Loans plus (iii) 4%
per annum; provided, however, that with respect to a Eurodollar Rate Loan, the Default Rate shall be an
interest rate equal to the interest rate (including any Applicable Rate) otherwise applicable to such Loan plus 4% per annum, and (b) when used with respect to L/C Fees, a rate equal to the
Applicable Rate plus 4% per annum. 

        "Defaulting Lender" means any Lender that (a) has failed to fund any portion of the Committed Loans, participations in L/C
Obligations or participations in Swing Line Loans required to be funded by it hereunder within one Business Day of the date required to be funded by it hereunder unless such failure has been cured,
(b) has otherwise failed to pay over to Agent or any other Lender any other amount required to be paid by it hereunder within one Business Day of the date when due, unless the subject of a good
faith dispute or unless such failure has been cured, or (c) has been deemed insolvent or become the subject of a bankruptcy or insolvency proceeding. 

        "Disposition" or "Dispose" means the sale, transfer, license, lease or other disposition
(including any sale and leaseback transaction) of any property by any Person, including any sale, assignment, transfer or other disposal, with or without recourse, of any notes or accounts receivable
or any rights and claims associated therewith. 

        "Dollar(s)" and "$" mean lawful money of the United States. 

        "Dollar Equivalent" means on any particular date, with respect to any amount denominated in Dollars, such amount in Dollars, and with
respect to any amount denominated in any other currency, the amount (as conclusively ascertained by the Lenders absent manifest error) of Dollars which could be purchased by the Lenders (in accordance
with its normal banking practices) in the London foreign currency deposit markets with such amount of such currency at the spot rate of exchange prevailing at or about 11:00 a.m. (London time)
on such date. 

        "Early Termination Fee" has the meaning specified in Section 2.06. 

        "EBITDA" means net income, less income or plus loss from discontinued operations and extraordinary items, plus income taxes, plus interest
expense, plus depreciation, depletion, and amortization plus, beginning on the closing date of the Basic Comfort Acquisition, the permitted addbacks relating to the Basic Comfort Acquisition set forth
on Schedule 1.01 hereto plus, beginning on the closing date of the Kiddopotamus Merger, the permitted addbacks relating to the Kiddopotamus
Merger set forth on Schedule 1.01 hereto. 

        "Eligible Assignee" means any Approved Fund or any other Person that meets the requirements to be an assignee under  Section 10.06(b)(iii), (v) and (vi) (subject to such consents, if any, as may be required under  Section 10.06(b)(iii)). 

        "Eligible Domestic Inventory" shall mean, as of any date of determination thereof, all Inventory owned by (and in the possession or under
the control of) any Pledging Borrower and located in a jurisdiction in the United States of America; provided that Eligible Domestic Inventory shall
include only such Inventory as is otherwise reasonably acceptable to the Agent in its good faith discretion from time to time and in any event shall not include any of the following:
(a) work-in-process; (b) Inventory located at leased premises or a warehouse with respect to which the Agent has not received a landlord's or warehousemen's
waiver and agreement on terms reasonably satisfactory to it; (c) Inventory as to which the Agent does not hold a duly perfected first priority lien; (d) Inventory which in the reasonable
judgment of the Agent is considered to be not merchantable; and 

7

 

(e) consigned
Inventory. The value of Eligible Domestic Inventory shall be determined at the lower of cost or market value in accordance with GAAP. 

        "Eligible Domestic Receivable" means a Receivable of SI USA, other than an Eligible Toys R Us Receivable or an Eligible Target Receivable,
which is reasonably acceptable to the Agent in its sole discretion, but at least is continuously in compliance with all of the following: 

        (a)   The
Receivable is an account which arose in the ordinary course of the business of SI USA from or in connection with a bona fide sale of goods or rendition of services,
performed in accordance with an order or contract, oral or written, wherein all obligations of SI USA regarding the shipment or delivery of such goods to the Customer have been satisfied or the
services have been performed for the Customer; no material part of such goods has been returned, rejected, lost or damaged; the Receivable is not evidenced by chattel paper or an instrument of any
kind; the Customer is not insolvent or the subject of any bankruptcy or insolvency proceeding of any kind; the Receivable is not subject to progress billings; and the corporate headquarters of the
Customer is located within the United States; 

        (b)   The
rights of SI USA in and to the Receivable and the proceeds thereof are not subject to any assignment, claim, lien, security interest or other encumbrance other than
pursuant to the Collateral Documents; 

        (c)   The
Receivable is not disputed nor subject to offset, credit allowance, contra account or adjustment by the Customer, except discounts for prompt payment offered in the
ordinary course of business or as disclosed to the Agent; 

        (d)   The
Receivable does not arise out of a transaction with an employee, officer, agent, director, stockholder, affiliate, or subsidiary of SI USA except as previously
disclosed and agreed by Agent, or any Person which, directly or indirectly, controls or is controlled by, or is under common control with, SI USA, as determined by the Agent; 

        (e)   The
Receivable has been due and payable for less than ninety (90) days from the invoice date; 

        (f)    As
to a Receivable of any single Customer, unless waived by the Agent, not more than thirty percent (30%) of the aggregate amount of the Receivables of such Customer
have been due and payable ninety (90) days or more from the invoice date; and 

        (g)   The
financial condition of the Customer is satisfactory to the Agent in its reasonable discretion. 

        "Eligible Foreign Inventory" shall mean, as of any date of determination thereof, all Inventory owned by (and in the possession or under
the control of) SI Europe and located in England or SI Canada and located in Canada; provided that Eligible Foreign Inventory shall include only such
Inventory as is otherwise reasonably acceptable to the Agent in its good faith discretion from time to time and in any event shall not include any of the following:
(a) work-in-process; (b) Inventory located at leased premises or a warehouse with respect to which the Agent has not received a landlord's or warehousemen's
waiver and agreement on terms reasonably satisfactory to it; (c) Inventory as to which the Agent does not hold a duly perfected first priority charge (with respect to SI Europe's Inventory) or
a perfected first priority security interest or the Canadian equivalent thereof (with respect to SI Canada's Inventory); (d) Inventory which is subject to any legal encumbrance other than
pursuant to the Collateral Documents; (e) Inventory which in the reasonable judgment of the Agent is considered to be not merchantable; (f) Inventory which has not been fully paid for by
SI Europe or SI Canada; and (g) consigned Inventory. The value of Eligible Foreign Inventory shall be determined at the lower of cost or market value in accordance with GAAP. 

8

 

        "Eligible Foreign Receivable" means a Receivable of SI Europe or SI Canada which is reasonably acceptable to the Agent in its sole
discretion, but at least is continuously in compliance with all of the following: 

        (a)   The
Receivable is an account which arose in the ordinary course of the business of SI Europe or SI Canada from or in connection with a bona fide sale of goods or
rendition of services, performed in accordance with an order or contract, oral or written, wherein all obligations of SI Europe or SI Canada regarding the shipment or delivery of such goods to the
Customer have been satisfied or the services have been performed for the Customer; no material part of such goods has been returned, rejected, lost or damaged; the Receivable is not evidenced by
chattel paper or an instrument of any kind; the Customer is not insolvent or the subject of any bankruptcy or insolvency proceeding of any kind; the Receivable is not subject to progress billings; the
Customer is an entity organized under the laws of England or Canada, as applicable; and the corporate headquarters of the Customer is located within England or Canada, as applicable; 

        (b)   The
rights of SI Europe or SI Canada in and to the Receivable and the proceeds thereof are not subject to any assignment, claim, lien, security interest or other
encumbrance other than pursuant to the Collateral Documents; 

        (c)   The
Receivable constitutes Collateral in which the Agent has a duly perfected first priority floating charge (with respect to SI Europe's Receivables) or a duly
perfected first priority security interest or the Canadian equivalent thereof (with respect to SI Canada's Receivables); 

        (d)   The
Receivable is not disputed nor subject to offset, credit allowance, contra account or adjustment by the Customer, except discounts for prompt payment offered in the
ordinary course of business or as disclosed to the Agent; 

        (e)   The
Receivable does not arise out of a transaction with an employee, officer, agent, director, stockholder, affiliate, or subsidiary of such Borrower except as
previously disclosed and agreed by Agent, or any Person which, directly or indirectly, controls or is controlled by, or is under common control with, SI Europe or SI Canada, as determined by the
Agent; 

        (f)    The
Receivable has been due and payable for less than ninety (90) days from the invoice date; 

        (g)   As
to a Receivable of any single Customer, unless waived by the Agent, not more than thirty percent (30%) of the aggregate amount of the Receivables of such Customer
have been due and payable ninety (90) days or more from the invoice date; 

        (h)   The
Receivable is denominated in Dollars, Pounds Sterling or Canadian Dollars; and 

        (i)    The
financial condition of the Customer is satisfactory to the Agent in its reasonable discretion. 

        "Eligible Target Receivable" means a Receivable of SI USA due from Target that is in compliance with all of the following: 

        (a)   The
Receivable is an account which arose in the ordinary course of the business of SI USA from or in connection with a bona fide sale of goods or rendition of services,
performed in accordance with an order or contract, oral or written, wherein all obligations of SI USA regarding the shipment or delivery of such goods to Target have been satisfied or the services
have been performed for Target; no material part of such goods has been returned, rejected, lost or damaged; the Receivable is not evidenced by chattel paper or an instrument of any kind; Target is
not insolvent or the subject of any bankruptcy or insolvency proceeding of any kind; and the Receivable is not subject to progress billings; 

        (b)   The
Receivable is not disputed nor subject to offset, credit allowance, contra account or adjustment by Target, except discounts for prompt payment offered in the
ordinary course of business or as disclosed to the Agent; and 

9

 

        (c)   Unless
waived by the Agent, not more than thirty percent (30%) of the aggregate amount of the Receivables of Target have been due and payable ninety (90) days or
more from the invoice date. 

        "Eligible Toys R Us Receivable" means a Receivable of SI USA due from Toys R Us that is in compliance with all of the following: 

        (a)   The
Receivable is an account which arose in the ordinary course of the business of SI USA from or in connection with a bona fide sale of goods or rendition of services,
performed in accordance with an order or contract, oral or written, wherein all obligations of SI USA regarding the shipment or delivery of such goods to Toys R Us have been satisfied or the services
have been performed for Toys R Us; no material part of such goods has been returned, rejected, lost or damaged; the Receivable is not evidenced by chattel paper or an instrument of any kind; Toys R Us
is not insolvent or the subject of any bankruptcy or insolvency proceeding of any kind; and the Receivable is not subject to progress billings; 

        (b)   The
Receivable is not disputed nor subject to offset, credit allowance, contra account or adjustment by Toys R Us, except discounts for prompt payment offered in the
ordinary course of business or as disclosed to the Agent; and 

        (c)   Unless
waived by the Agent, not more than thirty percent (30%) of the aggregate amount of the Receivables of Toys R Us have been due and payable ninety (90) days
or more from the invoice date. 

        "Environmental Laws" means any and all Federal, state, local, and foreign statutes, laws, regulations, ordinances, rules, judgments,
orders, decrees, permits, concessions, grants, franchises, licenses, agreements or governmental restrictions relating to pollution and the protection of the environment or the release of any materials
into the environment, including those related to hazardous substances or wastes, air emissions and discharges to waste or public systems. 

        "Environmental Liability" means any liability, contingent or otherwise (including any liability for damages, costs of environmental
remediation, fines, penalties or indemnities), of Borrowers, any other Loan Party or any of their respective Subsidiaries directly or indirectly resulting from or based upon (a) violation of
any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or threatened release of any Hazardous Materials into the environment or (e) any contract, agreement or other consensual arrangement pursuant to which liability is
assumed or imposed with respect to any of the foregoing. 

        "Equity Interests" means, with respect to any Person, all of the shares of capital stock of (or other ownership or profit interests in)
such Person, all of the warrants, options or other rights for the purchase or acquisition from such Person of shares of capital stock of (or other ownership or profit interests in) such Person, all of
the securities convertible into or exchangeable for shares of capital stock of (or other ownership or profit interests in) such Person or warrants, rights or options for the purchase or acquisition
from such Person of such shares (or such other interests), and all of the other ownership or profit interests in such Person (including partnership, member or trust interests therein), whether voting
or nonvoting, and whether or not such shares, warrants, options, rights or other interests are outstanding on any date of determination. 

        "ERISA" means the Employee Retirement Income Security Act of 1974. 

        "ERISA Affiliate" means any trade or business (whether or not incorporated) under common control with a Borrower within the meaning of
Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the Code). 

        "ERISA Event" means (a) a Reportable Event with respect to a Pension Plan; (b) a withdrawal by any Borrower or any ERISA
Affiliate from a Pension Plan subject to Section 4063 of ERISA during a 

10

 

plan
year in which it was a substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by any Borrower or any ERISA Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is in reorganization; (d) the
filing of a notice of intent to terminate, the treatment of a Plan amendment as a termination under Section 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a
Pension Plan or Multiemployer Plan; (e) an event or condition which constitutes grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer,
any Pension Plan or Multiemployer Plan; or (f) the imposition of any liability under Title IV of ERISA, other than for PBGC premiums due but not delinquent under Section 4007 of ERISA,
upon any Borrower or any ERISA Affiliate. 

        "Eurodollar Base Rate" has the meaning specified in the definition of Eurodollar Rate. 

        "Eurodollar Rate" means for any Interest Period with respect to a Eurodollar Rate Loan, a rate per annum determined by Agent pursuant to
the following formula: 

	Eurodollar Rate =	 	Eurodollar Base Rate
 1.00 - Eurodollar Reserve Percentage

        Where,

        "Eurodollar Base Rate" means, for such Interest Period the rate per annum equal to the British Bankers Association LIBOR Rate
("BBA LIBOR"), as published by Reuters (or other commercially available source providing quotations of BBA LIBOR as designated by Agent from time to
time) at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period, for Dollar deposits (for delivery on the first day of such Interest Period)
with a term equivalent to such Interest Period. If such rate is not available at such time for any reason, then the "Eurodollar Base Rate" for such
Interest Period shall be the rate per annum determined by Agent to be the rate at
which deposits in Dollars for delivery on the first day of such Interest Period in same day funds in the approximate amount of the Eurodollar Rate Loan being made, continued or converted by Bank of
America and with a term equivalent to such Interest Period would be offered by Bank of America's London Branch to major banks in the London interbank eurodollar market at their request at
approximately 11:00 a.m. (London time) two Business Days prior to the commencement of such Interest Period. 

        "Eurodollar Reserve Percentage" means, for any day during any Interest Period, the reserve percentage (expressed as a decimal, carried out
to five decimal places) in effect on such day, whether or not applicable to any Lender, under regulations issued from time to time by the Board of Governors of the Federal Reserve System of the United
States for determining the maximum reserve requirement (including any emergency, supplemental or other marginal reserve requirement) with respect to Eurocurrency funding (currently referred to as
"Eurocurrency liabilities"). The Eurodollar Rate for each outstanding Eurodollar Rate Loan shall be adjusted automatically as of the effective date of any change in the Eurodollar Reserve Percentage. 

        "Eurodollar Rate Loan" means a Committed Loan that bears interest at a rate based on the Eurodollar Rate. 

        "Event of Default" has the meaning specified in Section 8.01. 

        "Excluded Taxes" means, with respect to Agent, any Lender, the L/C Issuer or any other recipient of any payment to be made by or on
account of any obligation of Borrowers hereunder, (a) taxes imposed on or measured by its overall net income (however denominated), and franchise taxes imposed on it (in lieu of net income
taxes), by the jurisdiction (or any political subdivision thereof) under the laws of which such recipient is organized or in which its principal office is located or, in the case of any 

11

 

Lender,
in which its applicable Lending Office is located, and (b) any branch profits taxes imposed by the United States or any similar tax imposed by any other jurisdiction in which a Borrower
is located. 

        "Extraordinary Receipt" means any cash received by or paid to or for the account of any Person as proceeds of insurance (other than
proceeds of business interruption insurance to the extent such proceeds constitute compensation for lost earnings) or condemnation awards (and payments in lieu thereof);  provided, however, that an Extraordinary Receipt shall not include cash receipts from proceeds of
insurance, condemnation awards (or payments in lieu thereof) or indemnity payments to the extent that such proceeds, awards or payments in respect of loss or damage to equipment, fixed assets or real
property are applied (or in respect of which expenditures were previously incurred) to replace or repair the equipment, fixed assets or real property in respect of which such proceeds were received in
accordance with the terms of Section 2.05(b)(iii). 

        "Federal Funds Rate" means, for any day, the rate per annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such
day; provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next
preceding Business Day as so published on the next succeeding Business Day, and (b) if no such rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day
shall be the average rate (rounded upward, if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of America on such day on such transactions as determined by Agent. 

        "FRB" means the Board of Governors of the Federal Reserve System of the United States. 

        "Free Excess Cash Flow" means for a particular period, EBITDA for such period minus the
sum of the following for such period: (i) interest plus (ii) scheduled principal payments  plus (iii) unfunded capital expenditures in excess
of $750,000 in any fiscal year plus (or  minus) (iv) the change in working capital.
 

        "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 of its activities. 

        "Funded Debt" means all outstanding liabilities for borrowed money and other interest-bearing liabilities, including current and long term
liabilities, less the non-current portion of Subordinated Liabilities. 

        "GAAP" means generally accepted accounting principles in the United States set forth 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 such other principles as may be approved by
a significant segment of the accounting profession in the United States, that are applicable to the circumstances as of the date of determination, consistently applied. 

        "Governmental Authority" means the government of the United States or any other nation, or of any political subdivision thereof, whether
state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative
powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank). 

        "Guarantee" means, as to any Person, any (a) obligation, contingent or otherwise, of such Person guaranteeing or having the
economic effect of guaranteeing any Indebtedness or other obligation payable or performable by another Person (the "primary obligor") in any manner, whether directly or indirectly, and including any
obligation of such Person, direct or indirect, (i) to purchase or pay (or 

12

 

advance
or supply funds for the purchase or payment of) such Indebtedness or other obligation, (ii) to purchase or lease property, securities or services for the purpose of assuring the obligee
in respect of such Indebtedness or other obligation of the payment or performance of such Indebtedness or other obligation, (iii) to maintain working capital, equity capital or any other
financial statement condition or liquidity or level of income or cash flow of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation, or
(iv) entered into for the purpose of assuring in any other manner the obligee in respect of such Indebtedness or other obligation of the payment or performance thereof or to protect such
obligee against loss in respect thereof (in whole or in part), or (b) any Lien on any assets of such Person securing any Indebtedness or other obligation of any other Person, whether or not
such Indebtedness or other obligation is assumed by such Person (or any right, contingent or otherwise, of any holder of such Indebtedness to obtain any such Lien). The amount of any Guarantee shall
be deemed to be an amount equal to the stated or determinable amount of the related primary obligation, or portion thereof, in respect of which such Guarantee is made or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof as determined by the guaranteeing Person in good faith. The term "Guarantee" as a verb has a corresponding meaning. 

        "Hazardous Materials" means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other
pollutants, including petroleum or petroleum distillates, asbestos or asbestos-containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes and all other substances or
wastes of any nature regulated pursuant to any Environmental Law. 

        "Honor Date" has the meaning specified in Section 2.03(c)(i). 

        "ICC" has the meaning specified in Section 2.03(h). 

        "Indebtedness" means, as to any Person at a particular time, without duplication, all of the following, whether or not included as
indebtedness or liabilities in accordance with GAAP: 

        (a)   all
obligations of such Person for borrowed money and all obligations of such Person evidenced by bonds, debentures, notes, loan agreements or other similar instruments; 

        (b)   all
direct or contingent obligations of such Person arising under letters of credit (including standby and commercial), bankers' acceptances, bank guaranties, surety
bonds and similar instruments; 

        (c)   net
obligations of such Person under any Swap Contract; 

        (d)   all
obligations of such Person to pay the deferred purchase price of property or services (other than trade accounts payable in the ordinary course of business and, in
each case, not past due for more than 60 days after the date on which such trade account payable was created); 

        (e)   indebtedness
(excluding prepaid interest thereon) secured by a Lien on property owned or being purchased by such Person (including indebtedness arising under conditional
sales or other title retention agreements), whether or not such indebtedness shall have been assumed by such Person or is limited in recourse; 

        (f)    capital
leases and Synthetic Lease Obligations; 

        (g)   all
obligations of such Person to purchase, redeem, retire, defease or otherwise make any payment in respect of any Equity Interest in such Person or any other Person,
valued, in the case of a redeemable preferred interest, at the greater of its voluntary or involuntary liquidation preference plus accrued and unpaid
dividends; and 

        (h)   all
Guarantees of such Person in respect of any of the foregoing. 

        For
all purposes hereof, the Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture (other than a joint venture that is itself a corporation or
limited liability 

13

 

company)
in which such Person is a general partner or a joint venturer, unless such Indebtedness is expressly made non-recourse to such Person. The amount of any net obligation under any
Swap Contract on any date shall be deemed to be the Swap Termination Value thereof as of such date. The amount of any capital lease or Synthetic Lease Obligation as of any date shall be deemed to be
the amount of Attributable Indebtedness in respect thereof as of such date. 

        "Indemnified Taxes" means Taxes other than Excluded Taxes. 

        "Indemnitees" has the meaning specified in Section 10.04(b). 

        "Information" has the meaning specified in Section 10.07. 

        "Intercompany Notes" has the meaning specified in the Security Agreement. 

        "Interest Payment Date" means the first (1st) day of each calendar month, beginning on May 1, 2008. If the first
(1st) day of any month is not a Business Day, the Interest Payment Date for such month shall be the next Business Day. 

        "Interest Period" means, as to each Eurodollar Rate Loan, the period commencing on the date such Eurodollar Rate Loan is disbursed or
converted to or continued as a Eurodollar Rate Loan and ending on the date one, two, three, six or, if available, twelve months thereafter, as selected by Borrowers in its Committed Loan Notice;  provided that: 

        (i)    any
Interest Period that would otherwise end on a day that is not a Business Day shall be extended to the next succeeding Business Day unless such Business Day falls in
another calendar month, in which case such Interest Period shall end on the next preceding Business Day; 

        (ii)   any
Interest Period that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at
the end of such Interest Period) shall end on the last Business Day of the calendar month at the end of such Interest Period; and 

        (iii)  no
Interest Period shall extend beyond the Maturity Date. 

        "Intransit Inventory" means Inventory which is in-transit to a Pledging Borrower, and for which title has passed to such
Pledging Borrower and which is insured to the full value thereof by the Borrowers. The value of Intransit Inventory shall be determined at the lower of cost or market value in accordance with GAAP. 

        "Inventory" shall mean "inventory" as defined in Article 9 of the UCC. 

        "Investment" means, as to any Person, any direct or indirect acquisition or investment by such Person, whether by means of (a) the
purchase or other acquisition of capital stock or other securities of another Person, (b) a loan, advance or capital contribution to, Guarantee or assumption of debt of, or purchase or other
acquisition of any other debt or equity participation or interest in, another Person, including any partnership or joint venture interest in such other Person and any arrangement pursuant to which
the investor Guarantees Indebtedness of such other Person, or (c) the purchase or other acquisition (in one transaction or a series of transactions) of assets of another Person that constitute
a business unit. For purposes of covenant compliance, the amount of any Investment shall be the amount actually invested, without adjustment for subsequent increases or decreases in the value of such
Investment. 

        "IP Security Agreements" has the meaning specified in the Security Agreement. 

14

 

  
        "IRS" means the United States Internal Revenue Service. 

        "ISP" means, with respect to any Letter of Credit, the "International Standby Practices 1998" published by the Institute of International
Banking Law & Practice, Inc. (or such later version thereof as may be in effect at the time of issuance). 

        "Issuer Documents" means with respect to any Letter of Credit, the L/C Application, and any other document, agreement and instrument
entered into by the L/C Issuer and a Borrower (or any Subsidiary) or in favor of the L/C Issuer and relating to such Letter of Credit. 

        "Kiddo Acquisition Co." means Kiddo Acquisition Co., Inc., a Rhode Island corporation. 

        "Kiddopotamus" means Kiddopotamus & Company, a Delaware corporation. 

        "Kiddopotamus Merger" means the merger of Kiddo Acquisition Co. into Kiddopotamus on the Closing Date in exchange for shares of
common stock in SI Holdings, pursuant to the Kiddopotamus Articles of Merger, and pursuant to which Kiddopotamus shall be the surviving entity, together with the subsequent merger of Kiddopotamus into
SI USA on or after the Closing Date, pursuant to which SI USA will be the surviving entity. 

        "Kiddopotamus Purchase Agreement" means that certain Agreement and Plan of Merger dated as of April 8, 2008, by and between
Kiddopotamus, Kiddopotamus Seller, Kiddo Acquisition Co. and SI USA, as amended from time to time, in form and substance reasonably satisfactory to Agent. 

        "Kiddopotamus Seller" means, collectively, the current holders of Equity Interests in Kiddopotamus that are signatories to the
Kiddopotamus Purchase Agreement who will receive common stock in SI Holdings and cash consideration in exchange for their Equity Interests in Kiddopotamus as part of the Kiddopotamus Merger. 

        "Laws" means, collectively, all international, foreign, Federal, state and local statutes, treaties, rules, guidelines, regulations,
ordinances, codes and administrative or judicial precedents or authorities, including the interpretation or administration thereof by any Governmental Authority charged with the enforcement,
interpretation or administration thereof, and all applicable administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of law. 

        "L/C Advance" means, with respect to each Lender, such Lender's funding of its participation in any L/C Borrowing in accordance with its
Applicable Revolving Credit Percentage. 

        "L/C Application" means an application and agreement for the issuance or amendment of a Letter of Credit in the form from time to time in
use by the L/C Issuer. 

        "L/C Borrowing" means an extension of credit resulting from a drawing under any Letter of Credit which has not been reimbursed on the date
when made or refinanced as a Committed Revolving Credit Borrowing. 

        "L/C Credit Extension" means, with respect to any Letter of Credit, the issuance thereof or extension of the expiry date thereof, or the
increase of the amount thereof. 

        "L/C Expiration Date" means the day that is thirty days prior to the Maturity Date then in effect (or, if such day is not a Business Day,
the next preceding Business Day). 

        "L/C Fee" has the meaning specified in Section 2.03(i). 

        "L/C Issuer" means Bank of America in its capacity as issuer of Letters of Credit hereunder, or any successor issuer of Letters of Credit
hereunder. 

        "L/C Obligations" means, as at any date of determination, the aggregate amount available to be drawn under all outstanding Letters of
Credit plus the aggregate of all Unreimbursed Amounts, 

15

 

including
all L/C Borrowings. For purposes of computing the amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with  Section 1.06.
For all purposes of this Agreement, if on any date of determination a Letter of Credit has expired by its terms but any amount may
still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP, such Letter of Credit shall be deemed to be "outstanding" in the amount so remaining available to be drawn. 

        "L/C Sublimit" means an amount equal to $5,000,000. The L/C Sublimit is part of, and not in addition to, the Aggregate Commitments and/or
the Aggregate Revolving Credit Commitments. 

        "Lender" has the meaning specified in the introductory paragraph hereto and, as the context requires, includes Swing Line Lender. 

        "Lending Office" means, as to any Lender, the office or offices of such Lender described as such in such Lender's Administrative
Questionnaire, or such other office or offices as a Lender may from time to time notify Borrowers and Agent. 

        "Letter of Credit" means any standby letter of credit issued hereunder. 

        "Lien" means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge, or
preference, priority or other security interest or preferential arrangement in the nature of a security interest of any kind or nature whatsoever (including any conditional sale or other title
retention agreement, any easement, right of way or other encumbrance on title to real property, and any financing lease having substantially the same economic effect as any of the foregoing). 

        "Loan" means an extension of credit by a Lender to Borrowers under Article II in
the form of a Committed Loan or a Swing Line Loan. 

        "Loan Documents" means this Agreement, each Note, each Issuer Document, the Agent Fee Letter, each Collateral Document, and any other
documents which any Loan Party have executed and may execute to evidence, secure or guarantee the Obligations, each as may be amended from time to time. 

        "Loan Parties" means, collectively, Borrowers and each Person (other than Agent, the L/C Issuer, Swing Line Lender, or any Lender)
executing a Loan Document or Collateral Document. 

        "Material Adverse Effect" means (a) a material adverse change in, or a material adverse effect upon, the operations, business,
properties, liabilities (actual or contingent), condition (financial or otherwise) or prospects of Borrowers or Borrowers and their Subsidiaries taken as a whole; (b) a material impairment of
the ability of any Loan Party to perform its obligations under any Loan Document to which it is a party; or (c) a material adverse effect upon the legality, validity, binding effect or
enforceability against any Loan Party of any Loan Document to which it is a party; provided, however,
that none of the following shall be deemed to constitute a Material Adverse Effect: any adverse change, event, development or effect arising from (i) general economic conditions, including in
the United Kingdom or Canada; (ii) conditions relating to the manufacturing, distribution or sale of infant and child supplies, equipment or goods; (iii) regional, national or
international political or social conditions, including the engagement by the United States of America in hostilities, whether or not pursuant to the declaration of a national emergency or war, or the
occurrence of any military or terrorist attack upon the United States of America, or any of its territories, possessions or diplomatic or consular offices or upon any military installation, equipment
or personnel of the United States of America or any other national or international hostilities, acts of terror or acts of war, (iv) financial, banking or securities markets (including any
disruption thereof and any decline in the price of any security or any market index), (v) changes in GAAP, (vi) changes in applicable Law or Orders. 

16

 

        "Maturity Date" means April 10, 2011; provided,  however, that if such date is not a Business Day, the Maturity Date
shall be the next preceding Business Day. 

        "Monthly Due Date" has the meaning specified in Section 2.07(c). 

        "Mortgage" means that certain Second Open-End Mortgage Deed and Security Agreement of even date herewith executed by SI USA in
favor of Agent, to be recorded against the Woonsocket Property in the Land Evidence Records for the City of Woonsocket on or about the date hereof, as amended from time to time. 

        "Multiemployer Plan" means any employee benefit plan of the type described in Section 4001(a)(3) of ERISA, to which any Borrower or
any ERISA Affiliate makes or is obligated to make contributions, or during the preceding five plan years, has made or been obligated to make contributions. 

        "Net Cash Proceeds" means: 

	(a)
	with
respect to any Disposition by a Borrower or any Subsidiary, or any Extraordinary Receipt received or paid to the account of a Borrower or any Subsidiary, the excess, if any, of
(i) the sum of cash and Cash Equivalents received in connection with such transaction (including any cash or Cash Equivalents received by way of deferred payment pursuant to, or by monetization
of, a note receivable or otherwise, but only as and when so received) over (ii) the sum of (A) the principal amount of any Indebtedness that is secured by the applicable asset and that
is required to be repaid in connection with such transaction (other than Indebtedness under the Loan Documents), (B) the reasonable out-of-pocket expenses incurred by
Holdings or such Subsidiary in connection with such transaction and (C) income taxes reasonably estimated to be actually payable within two years of the date of the relevant transaction as a
result of any gain recognized in connection therewith; provided that, if the amount of any estimated taxes pursuant to subclause (C) exceeds the amount of taxes actually required to be paid in
cash in respect of such Disposition, the aggregate amount of such excess shall constitute Net Cash Proceeds; and

	(b)
	with
respect to the sale or issuance of any Equity Interest by a Borrower or a Subsidiary, or the incurrence or issuance of any Indebtedness by Borrower or a Subsidiary, the excess of
(i) the sum of the cash and Cash Equivalents received in connection with such transaction over (ii) the underwriting discounts and commissions, and other reasonable
out-of-pocket expenses, incurred by such Borrower or Subsidiary in connection therewith. 

        "Net Worth" means the value of total assets less Total Liabilities, including but not limited to accrued and deferred income taxes, but
excluding the non-current portion of Subordinated Liabilities. 

        "Non-Reinstatement Deadline" has the meaning specified in  Section 2.03(b)(v). 

        "Note(s)" means one or more promissory notes made by Borrowers in favor of a Lender evidencing Loans made by such Lender, substantially in
the form of Exhibit C, each as may be amended, restated, extended, replaced or otherwise modified from time to time. 

        "Obligations" means all advances to, and debts, liabilities, obligations, covenants and duties of, any Loan Party arising under any Loan
Document or otherwise with respect to any Loan or Letter of Credit, whether direct or indirect (including those acquired by assumption), absolute or contingent, due or to become due, now existing or
hereafter arising and including interest and fees that accrue after the commencement by or against any Loan Party or any Affiliate thereof of any proceeding under any Debtor Relief Laws naming such
Person as the debtor in such proceeding, regardless of whether such interest and fees are allowed claims in such proceeding. 

        "Organization Documents" means, (a) with respect to any corporation, the certificate or articles of incorporation and the bylaws
(or equivalent or comparable constitutive documents with respect to any 

17

 

non-U.S.
jurisdiction); (b) with respect to any limited liability company, the certificate or articles of formation or organization and operating agreement; and (c) with
respect to any partnership, joint venture, trust or other form of business entity, the partnership, joint venture or other applicable agreement of formation or organization and any agreement,
instrument, filing or notice with respect thereto filed in connection with its formation or organization with the applicable Governmental Authority in the jurisdiction of its formation or organization
and, if applicable, any certificate or articles of formation or organization of such entity. 

        "Other Taxes" means all present or future stamp, intangible or documentary taxes or any other excise or property taxes, charges or similar
levies arising from any payment made hereunder or under any other Loan Document or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any other Loan
Document. 

        "Outstanding Amount" means (i) with respect to Committed Loans and Swing Line Loans on any date, the aggregate outstanding
principal amount thereof after giving effect to any borrowings and prepayments or repayments of Committed Loans and Swing Line Loans, as the case may be, occurring on such date; and (ii) with
respect to any L/C Obligations on any date, the amount of such L/C Obligations on such date after giving effect to any L/C Credit Extension occurring on such date and any other changes in the
aggregate amount of the L/C Obligations as of such date, including as a result of any reimbursements by Borrowers of Unreimbursed Amounts. 

        "Overadvance Amount" means the amount by which the Total Outstandings exceed the Borrowing Base Availability, which shall in no event
exceed the lesser of: (i) ten percent (10%) of the current Borrowing Base Availability, or (ii) Three Million One Hundred Thousand Dollars ($3,100,000). 

        "Participant" has the meaning specified in Section 10.06(d). 

        "PBGC" means the Pension Benefit Guaranty Corporation. 

        "Pension Plan" means any "employee pension benefit plan" (as such term is defined in Section 3(2) of ERISA), other than a
Multiemployer Plan, that is subject to Title IV of ERISA and is sponsored or maintained by any Borrower or any ERISA Affiliate or to which any Borrower or any ERISA Affiliate contributes or has an
obligation to contribute, or in the case of a multiple employer or other plan
described in Section 4064(a) of ERISA, has made contributions at any time during the immediately preceding five plan years. 

        "Person" means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership,
Governmental Authority or other entity. 

        "Plan" means any "employee benefit plan" (as such term is defined in Section 3(3) of ERISA) established by any Borrower or, with
respect to any such plan that is subject to Section 412 of the Code or Title IV of ERISA, any ERISA Affiliate. 

        "Platform" has the meaning specified in Section 6.02. 

        "Pledging Borrowers" means, collectively, SI Holdings, SI USA, SI Europe, SI Canada and any future Borrower that pledges Collateral for
the Obligations pursuant to a first-priority perfected security interest. 

        "Pound Sterling" means the lawful currency of the United Kingdom of Great Britain and Northern Ireland. 

        "Public Lender" has the meaning specified in Section 6.02.

        "Real Estate Loan" means that certain real estate loan made by Bank of America to SI USA in the original principal amount of Four Million
Dollars ($4,000,000), as evidenced by the Real Estate Note. 

18

 

        "Real Estate Loan Agreement" means that certain Construction Loan Agreement dated as of December 21, 2006 by and between Faith
Realty, LLC, a Rhode Island limited liability company, as borrower, and Bank of America as lender, as assigned by Faith Realty, LLC to SI Holdings pursuant to that Assumption and
Modification Agreement dated as of March 1, 2007, as further assigned by SI Holdings to SI USA pursuant to that Assumption and Modification Agreement No. 2 dated as of March 6,
2007, as may have been or may be further amended from time to time. 

        "Real Estate Loan Documents" means, collectively, the Real Estate Loan Agreement, the Real Estate Mortgage and the Real Estate Note,
together with any other documents which evidence or secure the Real Estate Loan. 

        "Real Estate Mortgage" means that certain Open-End Mortgage and Security Agreement to Secure Present and Future Loans Under
Chapter 25 of Title 34 of the General Laws dated as of December 21, 2006 made by Faith Realty, LLC for the benefit of Bank of America, as recorded with the Land Evidence Records
of the City of Woonsocket on December 21, 2006 in Book 1614 at Page 190, as assigned by Faith Realty, LLC to SI USA and further amended by those Amendments to Open-End
Mortgage and Security Agreement and Collateral Assignment of Leases and Rents dated as of April 24, 2007 by and between SI USA and Bank of America, as recorded with the Land Evidence Records of
the City of Woonsocket on April 27, 2007 in Book 1652 at Page 20, as may have been or may be further amended from time to time. 

        "Real Estate Note" means that certain Amended and Restated Secured Promissory Note dated April 24, 2007 made by SI USA in favor of
Bank of America in the principal amount of $4,000,000, as amended, restated, extended, replaced or otherwise modified from time to time. 

        "Receivable" means all present and future rights of a Borrower to payment for goods sold or leased or for services rendered in the
ordinary course of its business, whether or not earned by performance. 

        "Reduction Amount" has the meaning specified in Section 2.05(b)(viii). 

        "Register" has the meaning specified in Section 10.06(c). 

        "Related Parties" means, with respect to any Person, such Person's Affiliates and the partners, directors, officers, employees, agents and
advisors of such Person and of such Person's Affiliates. 

        "Reportable Event" means any of the events set forth in Section 4043(c) of ERISA, other than events for which the 30 day
notice period has been waived. 

        "Request for Credit Extension" means (a) with respect to a Borrowing, conversion or continuation of Committed Loans, a Committed
Loan Notice, (b) with respect to an L/C Credit Extension, a L/C Application, and (c) with respect to a Swing Line Loan, a Swing Line Loan Notice. 

        "Required Acquisition Credit Lenders" means, as of any date of determination, Acquisition Credit Lenders having Aggregate Acquisition
Credit Commitments or, if the commitment of each Acquisition Credit Lender to make Acquisition Credit Loans has been terminated pursuant to  Section 8.02, Acquisition Credit Lenders holding in the
aggregate more that 662/3% of the Total Acquisition Credit Outstandings;  provided that the Acquisition Credit Commitment of, and the portion of the Total Acquisition Credit
Outstandings held or deemed held by any Defaulting
Lender shall be excluded for purposes of making a determination of Required Acquisition Credit Lenders. 

        "Required Lenders" means, as of any date of determination, Lenders having Aggregate Commitments or, if the commitment of each Lender to
make Loans and the obligation of the L/C Issuer to make L/C Credit Extensions have been terminated pursuant to Section 8.02, Lenders holding in
the aggregate more than 662/3% of the Total Outstandings (with the aggregate amount of each Lender's risk participation and funded participation in L/C Obligations and Swing Line Loans
being 

19

 

deemed
"held" by such Lender for purposes of this definition); provided that the Commitment of, and the portion of the Total Outstandings held or deemed
held by, any Defaulting Lender shall be excluded for purposes of making a determination of Required Lenders. 

        "Required Revolving Credit Lenders" means, as of any date of determination, Revolving Credit Lenders having Aggregate Revolving Credit
Commitments or, if the commitment of each Revolving Credit Lender to make Revolving Credit Loans and the obligation of the L/C Issuer to make L/C Extensions have been terminated pursuant to  Section 8.02, Revolving Credit Lenders holding in the aggregate more than 662/3% of the Total Revolving Credit Outstandings (with
the aggregate amount of each Revolving Credit Lender's risk participation and funded participation in L/C Obligations and Swing Line Loans being deemed "held" by such Revolving Credit Lender for
purposes of this definition); provided that the Revolving Credit Commitment of, and the portion of the Total Revolving Credit Outstandings held or
deemed held by any Defaulting Lender shall be excluded for purposes of making a determination of Required Revolving Credit Lenders. 

        "Responsible Officer" means the chief executive officer, president, chief financial officer, treasurer, assistant treasurer or controller
of a Loan Party and, solely for purposes of notices given pursuant to Article II, any other officer or employee of the applicable Loan Party so
designated by any of the foregoing officers in a notice to Agent. Any document delivered hereunder that is signed by a Responsible Officer of a Loan Party shall be conclusively presumed to have been
authorized by all necessary corporate, partnership and/or other action on the part of such Loan Party and such Responsible Officer shall be conclusively presumed to have acted on behalf of such Loan
Party. 

        "Restricted Payment" means any dividend or other distribution (whether in cash, securities or other property) with respect to any capital
stock or other Equity Interest of any Borrower or any Subsidiary, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the
purchase, redemption, retirement, acquisition, cancellation or termination of any such capital stock or other Equity Interest or on account of any return of capital to a Borrower's stockholders,
partners or members (or the equivalent Person thereof). 

        "Revolving Credit Availability Period" means the period from and including the Closing Date to the earliest of (a) the Maturity
Date, (b) the date of termination of the Aggregate Revolving Credit Commitments or the Aggregate Commitments pursuant to Section 2.06, and
(c) the date of termination of the commitment of each Lender to make Revolving Credit Loans and of the obligation of the L/C Issuer to make L/C Credit Extensions pursuant to  Section 8.02.

        "Revolving Credit Commitment" means, as to each Revolving Credit Lender, its obligation to (a) make Committed Revolving Credit
Loans to Borrowers pursuant to Section 2.01(a), (b) purchase participations in L/C Obligations, and (c) purchase participations in
Swing Line Loans, in an aggregate principal amount at any one time outstanding not to exceed the amount set forth opposite such Revolving Credit Lender's name on  Schedule 2.01 or in the Assignment
and Assumption pursuant to which such Revolving Credit Lender becomes a party hereto, as applicable, as such
amount may be adjusted from time to time in accordance with this Agreement. 

        "Revolving Credit Lender(s)" means, at any time, any Lender(s) that has/have a Revolving Credit Commitment at such time and, as the
context requires, includes Swing Line Lender. 

        "Revolving Credit Loan" means an extension of credit by a Revolving Credit Lender to Borrowers under  Section 2.01(a) in the form of a Committed Revolving Credit
Loan. 

        "SEC" means the Securities and Exchange Commission, or any Governmental Authority succeeding to any of its principal functions. 

20

 

  
        "Security Agreement" means that certain Guaranty and Security Agreement of even date herewith, by and between the Pledging Borrowers, as
debtors, and Agent, as secured party, as amended from time to time. 

        "SI Asia", "SI Canada", "SI Europe",
"SI Holdings" and "SI USA" each have the respective meaning set forth in the Preamble hereto. 

        "Subordinated Liabilities" means liabilities subordinated to the Obligations in a manner acceptable to Agent in its sole discretion. 

        "Subsidiary" of a Person means a corporation, partnership, joint venture, limited liability company or other business entity of which a
majority of the shares of securities or other interests having ordinary voting power for the election of directors or other governing body (other than securities or interests having such power only by
reason of the happening of a contingency) are at the time beneficially owned, or the management of which is otherwise controlled, directly, or indirectly through one or more intermediaries, or both,
by such Person. Unless otherwise specified, all references herein to a "Subsidiary" or to "Subsidiaries" shall refer to a Subsidiary or Subsidiaries of any Borrower. 

        "Swap Contract" means (a) any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate
transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward
bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions,
cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the
foregoing), whether or not any such transaction is governed by or subject to any master agreement, and (b) any and all transactions of any kind, and the related confirmations, which are subject
to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master
Agreement, or any other master agreement (any such master agreement, together with any related schedules, a "Master Agreement"), including any such
obligations or liabilities under any Master Agreement. 

        "Swap Termination Value" means, in respect of any one or more Swap Contracts, after taking into account the effect of any legally
enforceable netting agreement relating to such Swap Contracts, (a) for
any date on or after the date such Swap Contracts have been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the
date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Swap Contracts, as determined based upon one or more
mid-market or other readily available quotations provided by any recognized dealer in such Swap Contracts (which may include a Lender or any Affiliate of a Lender). 

        "Swing Line Borrowing" means a borrowing of a Swing Line Loan pursuant to  Section 2.04. 

        "Swing Line Lender" means Bank of America in its capacity as provider of Swing Line Loans, or any successor swing line lender hereunder. 

        "Swing Line Loan" has the meaning specified in Section 2.04(a). 

        "Swing Line Loan Notice" means a notice of a Swing Line Borrowing pursuant to  Section 2.04(b), which, if in writing, shall be substantially in the form of
Exhibit B. 

        "Swing Line Sublimit" means an amount equal to the lesser of (a) $5,000,000 and (b) the Aggregate Commitments. The Swing
Line Sublimit is part of (although uncommitted), and not in addition to, the Aggregate Commitments and/or the Aggregate Revolving Credit Commitments. 

21

 

        "Synthetic Lease Obligation" means the monetary obligation of a Person under (a) a so-called synthetic,
off-balance sheet or tax retention lease, or (b) an agreement for the use or possession of property creating obligations that do not appear on the balance sheet of such Person but
which, upon the insolvency or bankruptcy of such Person, would be characterized as the indebtedness of such Person (without regard to accounting treatment). 

        "Target" means Target Corporation, a Minnesota corporation. 

        "Taxes" means all present or future taxes, levies, imposts, duties, deductions, withholdings, assessments, fees or other charges imposed
by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto. 

        "Threshold Amount" means Five Hundred Thousand Dollars ($500,000). 

        "Total Acquisition Credit Outstandings" means the aggregate Outstanding Amount of all Acquisition Credit Loans. 

        "Total Eligible Target Receivables" means an amount equal to ninety-eight percent (98%) of all Eligible Target Receivables, which
percentage shall be adjusted to reflect each future change in the purchase discount negotiated by Target and SI USA. 

        "Total Eligible Toys R Us Receivables" means an amount equal to eighty-six percent (86%) of all Eligible Toys R Us
Receivables, which percentage shall be adjusted to reflect each future change in the purchase discount negotiated by Toys R Us and SI USA. 

        "Total Liabilities" means the sum of current liabilities plus long term liabilities. 

        "Total Outstandings" means the aggregate Outstanding Amount of all Loans and all L/C Obligations. 

        "Total Revolving Credit Outstandings" means the aggregate Outstanding Amount of all Revolving Credit Loans, Swing Line Loans and L/C
Obligations. 

        "Toys R Us" means Toys "R" Us, Inc., a Delaware corporation. 

        "Type" means, with respect to a Committed Loan, its character as a Base Rate Loan or a Eurodollar Rate Loan. 

        "UCC" means the Uniform Commercial Code as the same may be in effect from time to time in the State of Rhode Island. 

        "Unfunded Pension Liability" means the excess of a Pension Plan's benefit liabilities under Section 4001(a)(16) of ERISA, over the
current value of that Pension Plan's assets, determined in accordance with the assumptions used for funding the Pension Plan pursuant to Section 412 of the Code for the applicable plan year. 

        "United States" and "U.S." mean the United States of America. 

        "Unreimbursed Amount" has the meaning specified in Section 2.03(c)(i). 

        "Woonsocket Property" means that certain real property and related improvements owned by SI USA located at 1275 Park Drive East,
Woonsocket, Rhode Island. 

        1.02    Other Interpretive Provisions.    With reference to this
Agreement and each other Loan Document, unless otherwise specified herein or in such other Loan Document: 

        (a)   The
definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include
the corresponding masculine, feminine and neuter forms. The words "include," "includes" and
"including" shall be deemed to be followed by the phrase "without limitation." The word "will" shall be
construed to have the same 

22

 

meaning
and effect as the word "shall." Unless the context requires otherwise, (i) any definition of or reference to any agreement, instrument or
other document (including any Organization Document) shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or modifications set forth herein or in any other Loan Document), (ii) any reference herein to any Person shall be construed to
include such Person's successors and assigns, (iii) the words "herein," "hereof" and
"hereunder," and words of similar import when used in any Loan Document, shall be construed to refer to such Loan Document in its entirety and not to
any particular provision thereof, (iv) all references in a Loan Document to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and
Schedules to, the Loan Document in which such references appear, (v) any reference to any law shall include all statutory and regulatory provisions consolidating, amending, replacing or
interpreting such law and any reference to any law or regulation shall, unless otherwise specified, refer to such law or regulation as amended, modified or supplemented from time to time, and
(vi) the words "asset" and "property" shall be construed to have the same meaning and effect and
to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights. 

        (b)   In
the computation of periods of time from a specified date to a later specified date, the word "from" means
"from and including;" the words "to" and "until" each
mean "to but excluding;" and the word "through" means "to and
including." 

        (c)   Section
headings herein and in the other Loan Documents are included for convenience of reference only and shall not affect the interpretation of this Agreement or any
other Loan Document. 

        1.03    Accounting Terms.    (a)  Generally. All accounting terms not
specifically or completely defined herein shall be construed in conformity with, and all financial data (including
financial ratios and other financial calculations) required to be submitted pursuant to this Agreement shall be prepared in conformity with, GAAP applied on a consistent basis, as in effect from time
to time, applied in a manner consistent with that used in preparing the Audited Financial Statements, except as otherwise specifically prescribed
herein. 

        (b)   Changes in GAAP.    If at any time any change in GAAP would affect the computation of any financial ratio or
requirement set forth in any Loan Document, and either Borrowers or the Required Lenders shall so request, Agent, Lenders and Borrowers shall negotiate in good faith to amend such ratio or requirement
to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Required Lenders); provided that, until so
amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) Borrowers shall provide to Agent and Lenders financial
statements and other documents required under this Agreement or as reasonably requested hereunder setting forth a reconciliation between calculations of such ratio or requirement made before and after
giving effect to such change in GAAP. 

        1.04    Rounding.    Any financial ratios required to be maintained by
Borrowers pursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such
ratio is expressed herein and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number). 

        1.05    Times of Day.    Unless otherwise specified, all references
herein to times of day shall be references to Eastern time (daylight or standard, as applicable). 

        1.06    Letter of Credit Amounts.    Unless otherwise specified herein
the amount of a Letter of Credit at any time shall be deemed to be the stated amount of such Letter of Credit in effect at such time; provided,  however,
that with respect to any Letter of Credit that, by its terms or the terms of any Issuer Document related thereto, provides for one or more
automatic increases in the stated amount 

23

 

thereof,
the amount of such Letter of Credit shall be deemed to be the maximum stated amount of such Letter of Credit after giving effect to all such increases, whether or not such maximum stated
amount is in effect at such time. 

ARTICLE II. THE COMMITMENTS AND CREDIT EXTENSIONS  

        2.01    Committed Loans.    (a) Revolving
Credit Committed Loans. Subject to the terms and conditions set forth herein, each Revolving Credit Lender severally agrees to make revolving credit loans (each such loan, a
"Committed Revolving Credit Loan") to Borrowers from time to time, on any Business Day during the Revolving Credit Availability Period, in an aggregate
amount not to exceed at any time outstanding the amount of such Lender's Revolving Credit Commitment; provided,  however, that after giving effect to any
Committed Revolving Credit Borrowing, (i) the Total Outstandings shall not exceed the Aggregate
Commitments, (ii) the Total Revolving Credit Outstandings shall not exceed the Aggregate Revolving Credit Commitments, (iii) the aggregate Outstanding Amount of the Committed Loans of
any Lender, plus such Lender's Applicable Revolving Credit Percentage of the Outstanding Amount of all L/C Obligations,  plus such Lender's Applicable
Revolving Credit Percentage of the Outstanding Amount of all Swing Line Loans shall not exceed such Lender's Commitment,
and (iv) the aggregate Outstanding Amount of the Committed Revolving Credit Loans of any Revolving Credit Lender, plus such Revolving Credit
Lender's Applicable Revolving Credit Percentage of the Outstanding Amount of all L/C Obligations plus such Revolving Credit Lender's Applicable
Revolving Credit Percentage of the Outstanding Amount of all Swing Line Loans shall not exceed such Revolving Credit Lender's Revolving Credit Commitment. Within the limits of each Lender's Revolving
Credit Commitment, and subject to the other terms and conditions hereof, Borrowers may borrow under this Section 2.01(a), prepay under  Section 2.05, and reborrow under this Section 2.01(a). Committed Revolving Credit Loans
may be Base Rate Loans or Eurodollar Rate Loans, as further provided herein. 

        (b)   Acquisition Credit Committed Loans.    Subject to the terms and conditions set forth herein, each Acquisition
Credit Lender severally agrees to make acquisition loans (each such loan, a "Committed Acquisition Credit Loan") to Borrowers from time to time, on any
Business Day during the Acquisition Credit Availability Period, in an aggregate amount not to exceed at any time outstanding the amount of such Acquisition Credit Lender's Acquisition Credit
Commitment; provided, however, that after giving effect to any Committed Acquisition Credit Borrowing,
(i) the Total Outstandings shall not exceed the Aggregate Commitments, (ii) the Total Acquisition Credit Outstandings shall not exceed the Aggregate Acquisition Credit Commitments,
(iii) the aggregate Outstanding Amount of the Committed Loans of any Lender, plus such Lender's Applicable Revolving Credit Percentage of the
Outstanding Amount of all L/C Obligations, plus such Lender's Applicable Revolving Credit Percentage of the Outstanding Amount of all Swing Line Loans
shall not exceed such Lender's Commitment, and (iv) the aggregate Outstanding Amount of the Committed Acquisition Credit Loans of any Acquisition Credit Lender shall not exceed such Acquisition
Credit Lender's Acquisition Credit Commitment. Any amounts borrowed and repaid or prepaid under this Section 2.01(b) may not be reborrowed. 

        2.02    Borrowings, Conversions and Continuations of Committed
Loans.    (a) Each Committed Borrowing, each conversion of Committed Loans from one Type to the other, and each continuation of Eurodollar Rate Loans shall be made
upon Borrowers' irrevocable notice to Agent, which may be given by telephone. Each such notice must be received by Agent not later than 11:00 a.m. (i) three Business Days prior to the
requested date of any Borrowing of, conversion to or continuation of Eurodollar Rate Loans or of any conversion of Eurodollar Rate Loans to Base Rate Committed Loans, and (ii) on the requested
date of any Borrowing of Base Rate Committed Loans in duration as provided in the definition of "Interest Period", the applicable notice must be received by Agent not later than 11:00 a.m. four
Business Days prior to the requested date of such Borrowing, conversion or continuation, whereupon Agent shall give prompt notice to Lenders of such request and determine 

24

 

whether
the requested Interest Period is acceptable to all of them. Not later than 11:00 a.m., three Business Days before the requested date of such Borrowing, conversion or continuation, Agent
shall notify Borrowers (which notice may be by telephone) whether or not the requested Interest Period has been consented to by all Lenders. Each telephonic notice by Borrowers pursuant to this  Section 2.02(a)
 must be confirmed promptly by delivery to Agent of a written Committed Loan Notice, appropriately completed and signed by a
Responsible Officer of Borrowers. Each Borrowing of, conversion to or continuation of Eurodollar Rate Loans shall be in a principal amount of $500,000 or a whole multiple of $10,000 in excess thereof.
Except as provided in Sections 2.03(c) and 2.04(c), each Borrowing of or conversion to Base Rate
Committed Loans shall be in a principal amount of $500,000 or a whole multiple of $10,000 in excess thereof. Each Committed Loan Notice (whether telephonic or written) shall specify (i) whether
Borrowers are requesting a Committed Borrowing, a conversion of Committed Loans from one Type to the other, or a continuation of Eurodollar Rate Loans, (ii) the requested date of the Borrowing,
conversion or continuation, as the case may be (which shall be a Business Day), (iii) the principal amount of Committed Loans to be borrowed, converted or continued, (iv) the Type of
Committed Loans to be borrowed or to which existing Committed Loans are to be converted, and (v) if applicable, the duration of the Interest Period with respect thereto. If Borrowers fail to
specify a Type of Committed Loan in a Committed Loan Notice or if Borrowers fail to give a timely notice requesting a conversion or continuation, then the applicable Committed Loans shall be made as,
or converted to, Base Rate Loans. Any such automatic conversion to Base Rate Loans shall be effective as of the last day of the Interest Period then in effect with respect to the applicable Eurodollar
Rate Loans. If Borrowers request a Borrowing of, conversion to, or continuation of Eurodollar Rate Loans in any such Committed Loan Notice, but fails to specify an Interest Period, it will be deemed
to have specified an Interest Period of one month. 

        (b)   Following
receipt of a Committed Loan Notice, Agent shall promptly notify each Revolving Credit Lender (in the case of a request for a Committed Revolving Credit Loan)
or each Acquisition Credit Lender (in the case of a request for a Committed Acquisition Credit Loan) of the amount of its Applicable Percentage of the applicable Committed Loans, and if no timely
notice of a conversion or continuation is provided by Borrowers, Agent shall notify each applicable Lender of the details of any automatic conversion to Base Rate Loans described in the preceding
subsection. In the case of a Committed Borrowing, each Lender shall make the amount of its Committed Loan available to Agent in immediately available funds at Administrative Agent's Office not later
than 1:00 p.m. on the Business Day specified in the applicable Committed Loan Notice. Upon satisfaction of the applicable conditions set forth in  Section 4.02 (and, if such Borrowing is the
initial Credit Extension, Section 4.01), Agent
shall make all funds so received available to Borrowers in like funds as received by Agent either by (i) crediting the account of Borrowers on the books of Bank of America with the amount of
such funds or (ii) wire transfer of such funds, in each case in accordance with instructions provided to (and reasonably acceptable to) Agent by Borrowers;  provided, however, that if, on the date the Committed Loan Notice with respect to such Borrowing is
given by Borrowers, there are L/C Borrowings outstanding, then the proceeds of such Borrowing first, shall be applied, to the payment in full of any
such L/C Borrowings, and second, shall be made available to Borrowers as provided above. 

        (c)   Except
as otherwise provided herein, a Eurodollar Rate Loan may be continued or converted only on the last day of an Interest Period for such Eurodollar Rate Loan.
During the existence of a Default, no Loans may be requested as, converted to or continued as Eurodollar Rate Loans without the consent of the Required Lenders, and the Required Lenders may demand
that any or all of the then outstanding Eurodollar Rate Loans be converted immediately to Base Rate Committed Loans and Borrowers agree to jointly and severally pay all amounts due under  Section 3.05 in accordance with the terms thereof due to any such conversion. 

        (d)   Agent
shall promptly notify Borrowers and Lenders of the interest rate applicable to any Interest Period for Eurodollar Rate Loans upon determination of such interest
rate. 

25

 

        (e)   After
giving effect to all Committed Borrowings, all conversions of Committed Loans from one Type to the other, and all continuations of Committed Loans as the same
Type, there shall not be more than seven (7) Interest Periods in effect with respect to Committed Loans. 

        2.03    Letters of Credit.    (a) The Letter
of Credit Commitment. 

        (i)    Subject
to the terms and conditions set forth herein, (A) the L/C Issuer agrees, in reliance upon the agreements of the other Lenders set forth in this  Section 2.03, (1) from time to time on any
Business Day during the period from the Closing Date until the L/C Expiration Date, to issue
Letters of Credit for the account of Borrowers, and to amend Letters of Credit previously issued by it, in accordance with subsection (b) below, and (2) to honor drawings under the
Letters of Credit; and (B) the Revolving Credit Lenders severally agree to participate in Letters of Credit issued for the account of Borrowers and any drawings thereunder;  provided that after
giving effect to any L/C Credit Extension with respect to any Letter of Credit, (v) the Total Outstandings shall not exceed
the Aggregate Commitments, (w) the Total Revolving Credit Outstandings shall not exceed the Aggregate Revolving Credit Commitments, (x) the aggregate Outstanding Amount of the Committed
Loans of any Lender, plus such Lender's Applicable Revolving Credit Percentage of the Outstanding Amount of all L/C Obligations,  plus such Lender's
Applicable Revolving Credit Percentage of the Outstanding Amount of all Swing Line Loans shall not exceed such Lender's Commitment,
(y) the aggregate Outstanding Amount of the Committed Revolving Credit Loans of any Revolving Credit Lender, plus such Revolving Credit Lender's Applicable Revolving Credit Percentage of the
Outstanding Amount of all L/C Obligations plus such Revolving Credit Lender's Applicable Revolving Credit Percentage of the Outstanding Amount of all
Swing Line Loans shall not exceed such Revolving Credit Lender's Revolving Credit Commitment, and (z) the Outstanding Amount of the L/C Obligations shall not exceed the L/C Sublimit. Each
request by Borrowers for the issuance or amendment of a Letter of Credit shall be deemed to be a representation by Borrowers that the L/C Credit Extension so requested complies with the conditions set
forth in the proviso to the preceding sentence. Within the foregoing limits, and subject to the terms and conditions hereof, Borrowers' ability to obtain Letters of Credit shall be fully revolving,
and accordingly Borrowers may, during the foregoing period, obtain Letters of Credit to replace Letters of Credit that have expired or that have been drawn upon and reimbursed. 

        (ii)   The
L/C Issuer shall not issue any Letter of Credit, if: 

        (A)  subject
to Section 2.03(b)(iv), the expiry date of such requested Letter of Credit would occur more than twelve
(12) months after the date of issuance or last extension, unless the Required Revolving Credit Lenders have approved such expiry date; or 

        (B)  the
expiry date of such requested Letter of Credit would occur after the L/C Expiration Date, unless all the Revolving Credit Lenders have approved such expiry date. 

        (iii)  The
L/C Issuer shall be under no obligation to issue any Letter of Credit if: 

        (A)  any
order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain the L/C Issuer from issuing such Letter of
Credit, or any Law applicable to the L/C Issuer or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over the L/C Issuer shall
prohibit, or request that the L/C Issuer refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon the L/C Issuer with respect to such
Letter of Credit any restriction, reserve or capital requirement (for which the L/C Issuer is not otherwise compensated hereunder) not in effect on
the Closing Date, or shall impose upon the L/C Issuer any unreimbursed loss, cost or expense which was not applicable on the Closing Date and which the L/C Issuer in good faith deems material to it; 

26

 

        (B)  the
issuance of such Letter of Credit would violate one or more policies of the L/C Issuer applicable to letters of credit generally; 

        (C)  except
as otherwise agreed by Agent and the L/C Issuer, such Letter of Credit is in an initial stated amount less than $100,000, in the case of a commercial Letter of
Credit, or $500,000, in the case of a standby Letter of Credit; 

        (D)  such
Letter of Credit is to be denominated in a currency other than Dollars; 

        (E)  a
default of any Revolving Credit Lender's obligations to fund under Section 2.03(c) exists or any Revolving
Credit Lender is at such time a Defaulting Lender hereunder, unless the L/C Issuer has entered into satisfactory arrangements with Borrowers or such Revolving Credit Lender to eliminate the L/C
Issuer's risk with respect to such Revolving Credit Lender; or 

        (F)  unless
specifically provided for in this Agreement, such Letter of Credit contains any provisions for automatic reinstatement of the stated amount after any drawing
thereunder. 

        (iv)  The
L/C Issuer shall not amend any Letter of Credit if the L/C Issuer would not be permitted at such time to issue such Letter of Credit in its amended form under the
terms hereof. 

        (v)   The
L/C Issuer shall be under no obligation to amend any Letter of Credit if (A) the L/C Issuer would have no obligation at such time to issue such Letter of
Credit in its amended form under the terms hereof, or (B) the beneficiary of such Letter of Credit does not accept the proposed amendment to such Letter of Credit. 

        (vi)  The
L/C Issuer shall act on behalf of the Revolving Credit Lenders with respect to any Letters of Credit issued by it and the documents associated therewith, and the
L/C Issuer shall have all of the benefits and immunities (A) provided to Agent in Article IX 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 Issuer Documents pertaining to such Letters of Credit as fully as if the term
"Administrative Agent" or "Agent" as used in Article IX included the L/C Issuer with respect to such acts or omissions, and (B) as
additionally provided herein with respect to the L/C Issuer. 

        (b)   Procedures for Issuance and Amendment of Letters of Credit; Auto-Extension Letters of Credit. 

        (i)    Each
Letter of Credit shall be issued or amended, as the case may be, upon the request of Borrowers delivered to the L/C Issuer (with a copy to Agent) in the form of a
L/C Application, appropriately completed and signed by a Responsible Officer of Borrowers. Such L/C Application must be received by the L/C Issuer and Agent not later than 11:00 a.m. at least
two Business Days (or such later date and time as Agent and the L/C Issuer may agree in a particular instance in their sole discretion) prior to the proposed issuance date or date of amendment, as the
case may be. In the case of a request for an initial issuance of a Letter of Credit, such L/C Application shall specify in form and detail satisfactory to the L/C Issuer: (A) the proposed
issuance date of the requested Letter of Credit (which shall be a Business Day); (B) the amount thereof; (C) the expiry date thereof; (D) the name and address of the beneficiary
thereof; (E) the documents to be presented by such beneficiary in case of any drawing thereunder; (F) the full text of any certificate to be presented by such beneficiary in case of any
drawing thereunder; (G) the purpose and nature of the requested Letter of Credit; and (H) such other matters as the L/C Issuer may require. In the case of a request for an amendment of
any outstanding Letter of Credit, such L/C Application shall specify in form and detail satisfactory to the L/C Issuer (A) the Letter of Credit to be amended; (B) the proposed date of
amendment thereof (which shall be a Business Day); (C) the nature of the proposed amendment; and (D) such other matters as the L/C Issuer may require. Additionally, Borrowers shall
furnish to the L/C Issuer and Agent such other documents and information pertaining to such requested Letter of Credit issuance or amendment, including any Issuer Documents, as the L/C Issuer or Agent
may require. 

27

 

        (ii)   Promptly
after receipt of any L/C Application at the address set forth on Schedule 10.02 for receiving L/C
Applications and related correspondence, the L/C Issuer will confirm with Agent (by telephone or in writing) that Agent has received a copy of such L/C Application from Borrowers and, if not, the L/C
Issuer will provide Agent with a copy thereof. Unless the L/C Issuer has received written notice from any Revolving Credit Lender, Agent or any Loan Party, at least one Business Day prior to the
requested date of issuance or amendment of the applicable Letter of Credit, that one or more applicable conditions in Article IV shall not then
be satisfied, then, subject to the terms and conditions hereof, the L/C Issuer shall, on the requested date, issue a Letter of Credit for the account of Borrowers or enter into the applicable
amendment, as the case may be, in each case in accordance with the L/C Issuer's usual and customary business practices. Immediately upon the issuance of each Letter of Credit, each Lender shall be
deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the L/C Issuer a risk participation in such Letter of Credit in an amount equal to the product of such Lender's
Applicable Revolving Credit Percentage times the amount of such Letter of Credit. 

        (iii)  Promptly
after its delivery of any Letter of Credit or any amendment to a Letter of Credit to an advising bank with respect thereto or to the beneficiary thereof, the
L/C Issuer will also deliver to Borrowers and Agent a true and complete copy of such Letter of Credit or amendment. 

        (iv)  If
Borrowers so request in any applicable L/C Application, the L/C Issuer may, in its sole and absolute discretion, agree to issue a Letter of Credit that has automatic
extension provisions (each, an "Auto-Extension Letter of Credit"); provided that any such Auto-Extension Letter of Credit must
permit the L/C Issuer to prevent any such extension at least once in each twelve-month period (commencing with the date of issuance of such Letter of Credit) by giving prior notice to the beneficiary
thereof not later than a day (the "Non-Extension Notice Date") in each such twelve-month period to be agreed upon at the time such Letter of
Credit is issued. Unless otherwise directed by the L/C Issuer, Borrowers shall not be required to make a specific request to the L/C Issuer for any such extension. Once an Auto-Extension
Letter of Credit has been issued, the Revolving Credit Lenders shall be deemed to have authorized (but may not require) the L/C Issuer to permit the extension of such Letter of Credit at any time to
an expiry date not later than the L/C Expiration Date; provided, however, that the L/C Issuer shall not permit any such extension if (A) the L/C Issuer has determined that it would not be
permitted, or would have no obligation, at such time to issue such Letter of Credit in its revised form (as extended) under the terms hereof (by reason of the provisions of clause (ii) or
(iii) of Section 2.03(a) or otherwise), or (B) it has received notice (which may be by telephone or in writing) on or before the
day that is five Business Days before the Non-Extension Notice Date (1) from Agent that the Required Revolving Credit Lenders have elected not to permit such extension or
(2) from Agent, any Revolving Credit Lender or Borrowers that one or more of the applicable conditions specified in Section 4.02 is not
then satisfied, and in each such case directing the L/C Issuer not to permit such extension. 

        (v)   If
Borrowers so request in any applicable Letter of Credit Application, the L/C Issuer may, in its sole and absolute discretion, agree to issue a Letter of Credit that
permits the automatic reinstatement of all or a portion of the stated amount thereof after any drawing thereunder (each, an "Auto-Reinstatement Letter of
Credit"). Unless otherwise directed by the L/C Issuer, Borrowers shall not be required to make a specific request to the L/C Issuer to permit such reinstatement. Once an
Auto-Reinstatement Letter of Credit has been issued, except as provided in the following sentence, the Revolving Credit Lenders shall be deemed to have authorized (but may not require) the
L/C Issuer to reinstate all or a portion of the stated amount thereof in accordance with the provisions of such Letter of Credit. Notwithstanding the foregoing, if such Auto-Reinstatement
Letter of Credit permits the L/C Issuer to decline to reinstate all or any portion of the stated amount thereof after a drawing thereunder by giving notice of such non-reinstatement within
a specified number of days after such drawing (the "Non-Reinstatement Deadline"), the L/C Issuer shall not permit such reinstatement if it
has received a 

28

 

notice
(which may be by telephone or in writing) on or before the day that is seven Business Days before the Non-Reinstatement Deadline (A) from Agent that the Required Revolving
Credit Lenders have elected not to permit such reinstatement or (B) from Agent, any Revolving Credit Lender or Borrowers that one or more of the applicable conditions specified in  Section 4.02
is not then satisfied (treating such reinstatement as an L/C Credit Extension for purposes of this clause) and, in each case,
directing the L/C Issuer not to permit such reinstatement. 

        (c)   Drawings and Reimbursements; Funding of Participations.

        (i)    Upon
receipt from the beneficiary of any Letter of Credit of any notice of a drawing under such Letter of Credit, the L/C Issuer shall notify Borrowers and Agent
thereof. Not later than 11:00 a.m. on the date of any payment by the L/C Issuer under a Letter of Credit (each such date, an "Honor Date"),
Borrowers shall reimburse the L/C Issuer through Agent in an amount equal to the amount of such drawing. If Borrowers fail to so reimburse the L/C Issuer by such time, Agent shall promptly notify each
Revolving Credit Lender of the Honor Date, the amount of the unreimbursed drawing (the "Unreimbursed Amount"), and the amount of such Revolving Credit
Lender's Applicable Revolving Credit Percentage thereof. In such event, Borrowers shall be deemed to have requested a Committed Borrowing of Base Rate Loans to be disbursed on the Honor Date in an
amount equal to the Unreimbursed Amount, without regard to the minimum and multiples specified in Section 2.02 for the principal amount of Base
Rate Loans, but subject to the amount of the unutilized portion of the Aggregate Commitments and Aggregate Revolving Credit Commitments and the conditions set forth in  Section 4.02 (other than the
delivery of a Committed Loan Notice). Any notice given by the L/C Issuer or Agent pursuant to this  Section 2.03(c)(i) may be given by telephone if immediately confirmed in writing; provided that
the lack of such an immediate confirmation shall not affect the conclusiveness or binding effect of such notice. 

        (ii)   Each
Revolving Credit Lender shall upon any notice pursuant to Section 2.03(c)(i) make funds available to Agent
for the account of the L/C Issuer at the Administrative Agent's Office in an amount equal to its Applicable Revolving Credit Percentage of the Unreimbursed Amount not later than 1:00 p.m. on
the Business Day specified in such notice by Agent, whereupon, subject to the provisions of Section 2.03(c)(iii), each Revolving Credit Lender
that so makes funds available shall be deemed to have made a Base Rate Committed Loan to Borrowers in such amount. Agent shall remit the funds so received to the L/C Issuer. 

        (iii)  With
respect to any Unreimbursed Amount that is not fully refinanced by a Committed Borrowing of Base Rate Loans because the conditions set forth in  Section 4.02 cannot be satisfied or for any other
reason, Borrowers shall be deemed to have incurred from the L/C Issuer an L/C Borrowing in the
amount of the Unreimbursed Amount that is not so refinanced, which L/C Borrowing shall be due and payable on demand (together with interest) and shall bear interest at the Default Rate. In such event,
each Revolving Credit Lender's payment to Agent for the account of the L/C Issuer pursuant to Section 2.03(c)(ii) shall be deemed payment in
respect of its participation in such L/C Borrowing and shall constitute an L/C Advance from such Lender in satisfaction of its participation obligation under this  Section 2.03. 

29

 

  
        (iv)  Until each Revolving Credit Lender funds its Committed Revolving Credit Loan or L/C Advance pursuant to this  Section 2.03(c) to
reimburse the L/C Issuer for any amount drawn under any Letter of Credit, interest in respect of such Revolving Credit
Lender's Applicable Revolving Credit Percentage of such amount shall be solely for the account of the L/C Issuer. 

        (v)   Each
Revolving Credit Lender's obligation to make Committed Revolving Credit Loans or L/C Advances to reimburse the L/C Issuer for amounts drawn under Letters of Credit,
as contemplated by this Section 2.03(c), shall be absolute and unconditional and shall not be affected by any circumstance, including
(A) any setoff, counterclaim, recoupment, defense or other right which such Revolving Credit Lender may have against the L/C Issuer, Borrowers or any other Person for any reason whatsoever;
(B) the occurrence or continuance of a Default, or (C) any other occurrence, event or condition, whether or not similar to any of the foregoing;  provided, however, that each Revolving Credit Lender's obligation to make Committed Loans pursuant to
this Section 2.03(c) is subject to the conditions set forth in Section 4.02 (other than
delivery by Borrowers of a Committed Loan Notice). No such making of an L/C Advance shall relieve or otherwise impair the obligation of Borrowers to reimburse the L/C Issuer for the amount of any
payment made by the L/C Issuer under any Letter of Credit, together with interest as provided herein. 

        (vi)  If
any Revolving Credit Lender fails to make available to Agent for the account of the L/C Issuer any amount required to be paid by such Revolving Credit Lender
pursuant to the foregoing provisions of this Section 2.03(c) by the time specified in  Section 2.03(c)(ii), the L/C Issuer shall be entitled to
recover from such Revolving Credit Lender (acting through Agent), on demand, such amount
with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to the L/C Issuer at a rate per annum equal to the greater of the
Federal Funds Rate and a rate determined by the L/C issuer in accordance with banking industry rules on interbank compensation, plus any administrative,
processing or similar fees customarily charged by the L/C Issuer in connection with the foregoing. If such Revolving Credit Lender pays such amount (with interest and fees as aforesaid), the amount so
paid shall constitute such Revolving Credit Lender's Committed Revolving Credit Loan included in the relevant Committed Revolving Credit Borrowing or L/C Advance in respect of the relevant L/C
Borrowing, as the case may be. A certificate of the L/C Issuer submitted to any Revolving Credit Lender (through Agent) with respect to any amounts owing under this clause (vi) shall be
conclusive absent manifest error. 

        (d)   Repayment of Participations.

        (i)    At
any time after the L/C Issuer has made a payment under any Letter of Credit and has received from any Revolving Credit Lender such Revolving Credit Lender's L/C
Advance in respect of such payment in accordance with Section 2.03(c), if Agent receives for the account of the L/C Issuer any payment in respect
of the related Unreimbursed Amount or interest thereon (whether directly from Borrowers or otherwise, including proceeds of Cash Collateral applied thereto by Agent), Agent will distribute to such
Revolving Credit Lender its Applicable Revolving Credit Percentage thereof in the same funds as those received by Agent. 

        (ii)   If
any payment received by Agent for the account of the L/C Issuer pursuant to Section 2.03(c)(i) is required to
be returned under any of the circumstances described in Section 10.05 (including pursuant to any settlement entered into by the L/C Issuer in its
discretion), each Revolving Credit Lender shall pay to Agent for the account of the L/C Issuer its Applicable Revolving Credit Percentage thereof on demand of Agent, plus interest thereon from the
date of such demand to the date such amount is returned by such Revolving Credit Lender, at a rate per annum equal to the Federal Funds Rate from time to time in effect. The obligations of Lenders
under this clause shall survive the payment in full of the Obligations and the termination of this Agreement. 

        (e)   Obligations Absolute.    The obligation of Borrowers to reimburse the L/C Issuer for each drawing under each
Letter of Credit and to repay each L/C Borrowing shall be absolute, unconditional 

30

 

and
irrevocable, and shall be paid strictly in accordance with the terms of this Agreement under all circumstances, including the following: 

        (i)    any
lack of validity or enforceability of such Letter of Credit, this Agreement, or any other Loan Document; 

        (ii)   the
existence of any claim, counterclaim, setoff, defense or other right that Borrowers or any Subsidiary may have at any time against any beneficiary or any transferee
of such Letter of Credit (or any Person for whom any such beneficiary or any such transferee may be acting), the L/C Issuer or any other Person, whether in connection with this Agreement, the
transactions contemplated hereby or by such Letter of Credit or any agreement or instrument relating thereto, or any unrelated transaction; 

        (iii)  any
draft, demand, certificate or other document presented under such Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any
statement therein being untrue or inaccurate in any respect; or any loss or delay in the transmission or otherwise of any document required in order to make a drawing under such Letter of Credit; 

        (iv)  any
payment by the L/C Issuer under such Letter of Credit against presentation of a draft or certificate that does not comply with the terms of such Letter of Credit;
or any payment made by the
L/C Issuer under such Letter of Credit to any Person purporting to be a trustee in bankruptcy, debtor-in-possession, assignee for the benefit of creditors, liquidator, receiver
or other representative of or successor to any beneficiary or any transferee of such Letter of Credit, including any arising in connection with any proceeding under any Debtor Relief Law; or 

        (v)   any
other circumstance or happening whatsoever, whether or not similar to any of the foregoing, including any other circumstance that might otherwise constitute a
defense available to, or a discharge of, Borrowers or any Subsidiary. 

Borrowers
shall promptly examine a copy of each Letter of Credit and each amendment thereto that is delivered to it and, in the event of any claim of noncompliance with Borrowers' instructions or
other irregularity, Borrowers will immediately notify the L/C Issuer. Borrowers shall be conclusively deemed to have waived any such claim against the L/C Issuer and its correspondents unless such
notice is given as aforesaid. 

        (f)    Role of L/C Issuer.    Each Revolving Credit Lender and Borrowers agree that, in paying any drawing under a
Letter of Credit, the L/C Issuer shall not have any responsibility to obtain any document (other than any sight draft, certificates and documents expressly required by the Letter of Credit) or to
ascertain or inquire as to the validity or accuracy of any such document or the authority of the Person executing or delivering any such document. None of the L/C Issuer, Agent, any of their
respective Related Parties nor any correspondent, participant or assignee of the L/C Issuer shall be liable to any Revolving Credit Lender for (i) any action taken or omitted in connection
herewith at the request or with the approval of Revolving Credit Lenders or the Required Revolving Credit Lenders, as applicable; (ii) any action taken or omitted in the absence of gross
negligence or willful misconduct; or (iii) the due execution, effectiveness, validity or enforceability of any document or instrument related to any Letter of Credit or Issuer Document.
Borrowers hereby assume all risks of the acts or omissions of any beneficiary or transferee with respect to its use of any Letter of Credit; provided,  however, that this assumption is not intended to, and shall not, preclude Borrowers' pursuing such rights and remedies as it may have against the
beneficiary or transferee at law or under any other agreement. None of the L/C Issuer, Agent, any of their respective Related Parties nor any correspondent, participant or assignee of the L/C Issuer,
shall be liable or responsible for any of the matters described in clauses (i) through (v) of Section 2.03(e);  provided, however, that anything in such clauses to the contrary notwithstanding, Borrowers may have a
claim against the L/C Issuer, and the L/C Issuer may be liable to Borrowers, to the extent, but only to the extent, of any direct, as opposed to consequential or exemplary, damages 

31

 

suffered
by Borrowers which Borrowers prove were caused by the L/C Issuer's willful misconduct or gross negligence or the L/C Issuer's willful failure to pay under any Letter of Credit after the
presentation to it by the beneficiary of a sight draft and certificate(s) complying with the terms and conditions of a Letter of Credit. In furtherance and not in limitation of the foregoing, the L/C
Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary, and the L/C Issuer
shall not be responsible for the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign a Letter of Credit or the rights or benefits thereunder or
proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason. 

        (g)   Cash Collateral.    Upon the request of Agent, (i) if the L/C Issuer has honored any full or partial
drawing request under any Letter of Credit and such drawing has resulted in an L/C Borrowing, or (ii) if, as of the L/C Expiration Date, any L/C Obligation for any reason remains outstanding,
Borrowers shall, in each case, immediately Cash Collateralize the then Outstanding Amount of all L/C Obligations. Sections 2.05 and  8.02(c) set forth
certain additional requirements to deliver Cash Collateral hereunder. For purposes hereof, "Cash
Collateralize" means to pledge and deposit with or deliver to Agent, for the benefit of the L/C Issuer and the Revolving Credit Lenders, as collateral for the L/C Obligations,
cash or deposit account balances pursuant to documentation in form and substance satisfactory to Agent and the L/C Issuer (which documents are hereby consented to by Revolving Credit Lenders).
Derivatives of such term have corresponding meanings. Borrowers hereby grant to Agent, for the benefit of the L/C Issuer and Revolving Credit Lenders, a security interest in all such cash, deposit
accounts and all balances therein and all proceeds of the foregoing. Cash collateral shall be maintained in blocked, non-interest bearing deposit accounts at Bank of America. 

        (h)   Applicability of ISP and UCP.    Unless otherwise expressly agreed by the L/C Issuer and Borrowers when a
Letter of Credit is issued, (i) the rules of the ISP shall apply to each standby Letter of Credit, and (ii) the rules of the Uniform Customs and Practice for Documentary Credits, as most
recently published by the International Chamber of Commerce (the "ICC") at the time of issuance shall apply to each commercial Letter of Credit. 

        (i)    L/C Fees.    Borrowers shall pay to Agent for the account of each Revolving Credit Lender in accordance with
its Applicable Revolving Credit Percentage a L/C fee (the "L/C Fee") for each Letter of Credit equal to the Applicable Rate  times the daily amount
available to be drawn under such Letter of Credit. For purposes of computing the daily amount available to be drawn under any
Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.06. L/C Fees shall be (i) due and
payable on the first Business Day after the end of each March, June, September and December, commencing with the first such date to occur after the issuance of such Letter of Credit, on the L/C
Expiration Date and thereafter on demand and (ii) computed on a quarterly basis in arrears. If there is any change in the Applicable Rate during any quarter, the daily amount available to be
drawn under each Letter of Credit shall be computed and multiplied by the Applicable Rate separately for each period during such quarter that such Applicable Rate was in effect. Notwithstanding
anything to the contrary contained herein, upon the request of the Required Lenders, while any Event of Default exists, all L/C Fees shall accrue at the Default Rate. 

        (j)    Fronting Fee and Documentary and Processing Charges Payable to L/C Issuer.    Borrowers shall pay directly to
the L/C Issuer for its own account a fronting fee with respect to each Letter of Credit, at the rate per annum specified in the Agent Fee Letter, computed on the daily amount available to be drawn
under such Letter of Credit and on a quarterly basis in arrears. Such fronting fee shall be due and payable on the tenth Business Day after the end of each March, June, September and December, in
respect of the most recently-ended quarterly period (or portion thereof, in the case of the first payment), commencing with the first such date to occur after the issuance of such Letter of Credit, on
the L/C Expiration Date and thereafter on demand. For purposes of computing the daily amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be 

32

 

determined
in accordance with Section 1.06. In addition, Borrowers shall pay directly to the L/C Issuer for its own account the customary
issuance, presentation, amendment and other processing fees, and other standard costs and charges, of the L/C Issuer relating to letters of credit as from time to time in effect. Such individual
customary fees and standard costs and charges are due and payable on demand and are nonrefundable. 

        (k)   Conflict with Issuer Documents.    In the event of any conflict between the terms hereof and the terms of any
Issuer Documents, the terms hereof shall control. 

        2.04    Swing Line Loans.    (a) The Swing
Line. Subject to the terms and conditions set forth herein, Swing Line Lender agrees, in reliance upon the agreements of the other Revolving Credit Lenders set forth in this  Section 2.04, to consider in its sole and absolute discretion making loans (each such loan, a "Swing Line
Loan") to Borrowers from time to time on any Business Day during the Availability Period in an aggregate amount not to exceed at any time outstanding the amount of the Swing
Line Sublimit, notwithstanding the fact that such Swing Line Loans, when aggregated with the Applicable Revolving Credit Percentage of the Outstanding Amount of Committed Loans and L/C Obligations of
the Lender acting as Swing Line Lender, may exceed the amount of such Lender's Commitment; provided,  however, that after giving effect to any Swing Line
Loan, (i) the Total Outstandings shall not exceed the Aggregate Commitments, (ii) the
Total Revolving Credit Outstandings shall not exceed the Aggregate Revolving Credit Commitments, (iii) the aggregate Outstanding Amount of the Committed Loans of any Lender,  plus such Lender's
Applicable Revolving Credit Percentage of the Outstanding Amount of all L/C Obligations,  plus such Lender's Applicable Revolving Credit Percentage of the Outstanding Amount of all Swing Line Loans shall
not exceed such Lender's Commitment,
and (iv) the Aggregate Outstanding Amount of the Commitment Revolving Credit Loans of any Revolving Credit Lender, plus such Revolving Credit
Lender's Applicable Revolving Credit Percentage of the Outstanding Amount of all L/C Obligations plus such Revolving Credit Lender's Applicable
Revolving Credit Percentage of the Outstanding Amount of all Swing Line Loans shall not exceed such Revolving Credit Lender's Revolving Credit Commitments. The Swing Line is a discretionary,
uncommitted facility and Swing Line Lender may terminate or suspend the Swing Line at any time in its sole discretion upon notice to Borrowers which notice may be given by Swing Line Lender before or
after Borrowers request a Swing Line Loan hereunder. Each Swing Line Loan shall be a Base Rate Loan. Immediately upon the making of a Swing Line Loan, each Revolving Credit Lender shall be deemed to,
and hereby irrevocably and unconditionally agrees to, purchase from Swing Line Lender a risk participation in such Swing Line Loan in an amount equal to the product of such Revolving Credit Lender's
Applicable Revolving Credit Percentage times the amount of such Swing Line Loan. 

        (b)   Borrowing Procedures.    Unless the Swing Line has been terminated or suspended by the Swing Line Lender as
provided in subsection (a) above, each Swing Line Borrowing shall be made upon Borrowers' irrevocable notice to Swing Line Lender and Agent, which may be given by telephone. Each such notice
must be received by Swing Line Lender and Agent not later than 1:00 p.m. on the requested borrowing date, and shall specify (i) the amount to be borrowed, which shall be a minimum of
$100,000, and (ii) the requested borrowing date, which shall be a Business Day. Each such telephonic notice must be confirmed promptly by delivery to Swing Line Lender and Agent of a written
Swing Line Loan Notice, appropriately completed and signed by a Responsible Officer of Borrowers. Promptly after receipt by Swing Line Lender of any telephonic Swing Line Loan Notice, Swing Line
Lender will confirm with Agent (by telephone or in writing) that Agent has also received such Swing Line Loan Notice and, if not, Swing Line Lender will notify Agent (by telephone or in writing) of
the contents thereof. Unless (x) the Swing Line has been terminated or suspended by the Swing Line Lender as provided in subsection (a) above, or (y) the Swing Line Lender has
received notice (by telephone or in writing) from Agent (including at the request of any Lender) prior to 2:00 p.m. on the date of the proposed Swing Line Borrowing (A) directing Swing
Line Lender not to make such Swing 

33

 

Line
Loan as a result of the limitations set forth in the proviso to the first sentence of Section 2.04(a), or (B) that one or more of the
applicable conditions specified in Article IV is not then satisfied, then, subject to the terms and conditions hereof, Swing Line Lender will,
not later than 3:00 p.m. on the borrowing date specified in such Swing Line Loan Notice, make the amount of its Swing Line Loan available to Borrowers at its office by crediting the account of
Borrowers on the books of Swing Line Lender in immediately available funds. Revolving Credit Lenders agree that Swing Line Lender may agree to modify the borrowing procedures used in connection with
the Swing Line in its discretion and without affecting any of the obligations of Lenders hereunder other than notifying Agent of a Swing Line Loan Notice. 

        (c)   Refinancing of Swing Line Loans.

        (i)    Swing
Line Lender at any time in its sole and absolute discretion may request, on behalf of Borrowers (which hereby irrevocably authorizes Swing Line Lender to so
request on its behalf), that each Revolving Credit Lender make a Base Rate Committed Loan in an amount equal to such Revolving Credit Lender's Applicable Revolving Credit Percentage of the amount of
Swing Line Loans then outstanding. Such request shall be made in writing (which written request shall be deemed to be a Committed Loan Notice for purposes hereof) and in accordance with the
requirements of Section 2.02, without regard to the minimum and multiples specified therein for the principal amount of Base Rate Loans, but
subject to the unutilized portion of the Aggregate Commitments and the conditions set forth in Section 4.02. Swing Line Lender shall furnish
Borrowers with a copy of the applicable Committed Loan Notice promptly after delivering such notice to Agent. Each Revolving Credit Lender shall make an amount equal to its Applicable Revolving Credit
Percentage of the amount specified in such Committed Loan Notice available to Agent in immediately available funds for the account of Swing Line Lender at the Administrative Agent's Office not later
than 1:00 p.m. on the day specified in such Committed Loan Notice, whereupon, subject to Section 2.04(c)(ii), each Revolving Credit Lender
that so makes funds available shall be deemed to have made a Base Rate Committed Loan to Borrowers in such amount. Agent shall remit the funds so received to Swing Line Lender. 

        (ii)   If
for any reason any Swing Line Loan cannot be refinanced by such a Committed Revolving Credit Borrowing in accordance with  Section 2.04(c)(i), the request for Base Rate Committed Loans submitted by
Swing Line Lender as set forth herein shall be deemed to be a request
by Swing Line Lender that each of the Revolving Credit Lenders fund its risk participation in the relevant Swing Line Loan and each Revolving Credit Lender's payment to Agent for the account of Swing
Line Lender pursuant to Section 2.04(c)(i) shall be deemed payment in respect of such participation. 

        (iii)  If
any Revolving Credit Lender fails to make available to Agent for the account of Swing Line Lender any amount required to be paid by such Revolving Credit Lender
pursuant to the foregoing provisions of this Section 2.04(c) by the time specified in  Section 2.04(c)(i), Swing Line Lender shall be entitled to
recover from such Revolving Credit Lender (acting through Agent), on demand, such
amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to Swing Line Lender at a rate per annum equal to the
greater of the Federal Funds Rate and a rate determined by Swing Line Lender in accordance with banking industry rules on interbank compensation, plus
any administrative, processing or similar fees customarily charged by Swing Line Lender in connection with the foregoing. If such Revolving Credit Lender pays such amount (with interest and fees as
aforesaid), the amount so paid shall constitute such Revolving Credit Lender's Committed Loan included in the relevant Committed Borrowing or funded participation in the relevant Swing Line Loan, as
the case may be. A certificate of Swing Line Lender submitted to any Revolving Credit Lender (through Agent) with respect to any amounts owing under this clause (iii) shall be conclusive absent
manifest error. 

        (iv)  Each
Revolving Credit Lender's obligation to make Committed Revolving Credit Loans or to purchase and fund risk participations in Swing Line Loans pursuant to this  Section 2.04(c) shall be 

34

 

absolute
and unconditional and shall not be affected by any circumstance, including (A) any setoff, counterclaim, recoupment, defense or other right which such Revolving Credit Lender may have
against Swing Line Lender, Borrowers or any other Person for any reason whatsoever, (B) the occurrence or continuance of a Default, or (C) any other occurrence, event or condition,
whether or not similar to any of the foregoing; provided, however, that each Revolving Credit Lender's
obligation to make Committed Loans pursuant to this Section 2.04(c) is subject to the conditions set forth in  Section 4.02. No such funding of
risk participations shall relieve or otherwise impair the obligation of Borrowers to repay Swing Line Loans,
together with interest as provided herein. 

        (d)   Repayment of Participations.

        (i)    At
any time after any Revolving Credit Lender has purchased and funded a risk participation in a Swing Line Loan, if Swing Line Lender receives any payment on account of
such Swing Line Loan, Swing Line Lender will distribute to such Revolving Credit Lender its Applicable Revolving Credit Percentage thereof in the same funds as those received by Swing Line Lender. 

        (ii)   If
any payment received by Swing Line Lender in respect of principal or interest on any Swing Line Loan is required to be returned by Swing Line Lender under any of the
circumstances described in Section 10.05 (including pursuant to any settlement entered into by Swing Line Lender in its discretion), each
Revolving Credit Lender shall pay to Swing Line Lender its Applicable Revolving Credit Percentage thereof on demand of Agent, plus interest thereon from the date of such demand to the date such amount
is returned, at a rate per annum equal to the Federal Funds Rate. Agent will make such demand upon the request of Swing Line Lender. The obligations of Revolving Credit Lenders under this clause shall
survive the payment in full of the Obligations and the termination of this Agreement. 

        (e)   Interest for Account of Swing Line Lender.    Swing Line Lender shall be responsible for invoicing Borrowers
for interest on the Swing Line Loans. Until each Revolving Credit Lender funds its Base Rate Committed Loan or risk participation pursuant to this  Section 2.04 to refinance such Revolving Credit
Lender's Applicable Revolving Credit Percentage of any Swing Line Loan, interest in respect of
such Applicable Revolving Credit Percentage shall be solely for the account of Swing Line Lender. 

        (f)    Payments Directly to Swing Line Lender.    Borrowers shall make all payments of principal and interest in
respect of the Swing Line Loans directly to Swing Line Lender. 

        2.05    Prepayments.    (a)  Optional. (i) Borrowers may, upon notice
to Agent, at any time or from time to time voluntarily prepay Committed Loans in whole or in part
without premium or penalty; provided that (A) such notice must be received by Agent not later than 11:00 a.m. (1) three Business
Days prior to any date of prepayment of Eurodollar Rate Loans and (2) on the date of prepayment of Base Rate Committed Loans; (B) any prepayment of Eurodollar Rate Loans shall be in a
principal amount of $2,000,000 or a whole multiple of $500,000 in excess thereof; and (C) any prepayment of Base Rate Committed Loans shall be in a principal amount of $500,000 or a whole
multiple of $100,000 in excess thereof or, in each case, if less, the entire principal amount thereof then outstanding. Each such notice shall specify the date and amount of such prepayment and the
Type(s) of Committed Loans to be prepaid and, if Eurodollar Rate Loans are to be prepaid, the Interest Period(s) of such Loans. Agent will promptly notify each Lender of its receipt of each such
notice, and of the amount of such Lender's Applicable Percentage of such prepayment. If such notice is given by Borrowers, Borrowers shall make such prepayment and the payment amount specified in such
notice shall be due and payable on the date specified therein. Any prepayment of a Eurodollar Rate Loan shall be accompanied by all accrued interest on the amount prepaid, together with any additional
amounts required pursuant to Section 3.05. Each such prepayment shall be applied to the Committed Loans of Lenders in accordance with their
respective Applicable Percentages. 

35

 

        (ii)   Borrowers
may, upon notice to Swing Line Lender (with a copy to Agent), at any time or from time to time, voluntarily prepay Swing Line Loans in whole or in part
without premium or penalty; provided that (A) such notice must be received by Swing Line Lender and Agent not later than 1:00 p.m. on the
date of the prepayment, and (B) any such prepayment shall be in a minimum principal amount of $100,000. Each such notice shall specify the date and amount of such prepayment. If such notice is
given by Borrowers, Borrowers shall make such prepayment and the payment amount specified in such notice shall be due and payable on the date specified therein. 

        (b)   Mandatory.    (i) If any Borrower or any Subsidiary Disposes of any property (other than any Disposition of any
property permitted by Section 7.05(a), (b), (c)
or (d)) which results in the realization by any such Person of Net Cash Proceeds, the Borrowers shall prepay an aggregate principal amount of Loans
equal to 100% of such Net Cash Proceeds immediately upon receipt thereof by such Person (such prepayments to be applied as set forth in clause (viii) below). 

        (ii)   Upon
the incurrence or issuance by any Borrower or any Subsidiary of any Indebtedness (other than Indebtedness expressly permitted to be incurred or issued pursuant to  Section 7.03(a)-(e)), the
Borrowers shall prepay an aggregate principal amount of Loans equal to 100% of all Net Cash Proceeds received therefrom
immediately upon receipt thereof by any such Person (such prepayments to be applied as set forth in clause (viii) below). 

        (iii)  Upon
any Extraordinary Receipt received by or paid to or for the account of any Borrower or any Subsidiary, the Borrowers shall prepay an aggregate principal amount of
Loans equal to 100% of all Net Cash Proceeds received therefrom immediately upon receipt thereof by any such Person (such prepayments to be applied as set forth in clause (viii) below);  provided,
however, that with respect to any proceeds of insurance or condemnation awards (or payments in
lieu thereof), at the election of the Borrowers (as notified by the Borrowers to the Agent on or prior to the date of receipt of such insurance proceeds, condemnation awards or indemnity payments),
and so long as no Default shall have occurred and be continuing, such Person may apply within 180 days after the receipt of such cash proceeds to replace or repair the equipment, fixed assets
or real property in respect of which such cash proceeds were received; and provided, further,  however, that
any cash proceeds not so applied shall be immediately applied to the prepayment of the Loans as set forth in this  Section 2.05(b)(iii). 

        (iv)  If,
at the end of any fiscal year (commencing with the fiscal year ending December 31, 2009), the ratio of Borrowers' Funded Debt to EBITDA Ratio exceeds
2.75:1.00 for such fiscal year, the Borrowers shall prepay an aggregate principal amount of the Acquisition Credit Loans equal to fifty percent (50%) of the Borrowers' Free Excess Cash Flow for each
fiscal year, which prepayment shall be made within one hundred twenty (120) days of the end of such fiscal year. Prepayments made pursuant to this  Section 2.05(b)(iv) shall be applied to the
outstanding principal on the Acquisition Credit Loans in inverse order of maturity. No payment shall
be required from Borrowers' Free Cash Flow if the aggregate outstanding principal on the Acquisition Credit Loans is $0. 

36

 

 

        (v)   If for any reason the Total Outstandings at any time exceed the Aggregate Commitments then in effect, Borrowers shall immediately prepay Loans and/or Cash Collateralize
the L/C Obligations in an aggregate amount equal to such excess; provided, however, that Borrowers shall
not be required to Cash Collateralize the L/C Obligations pursuant to this Section 2.05(c) unless after the prepayment in full of the Loans the
Total Outstandings exceed the Aggregate Commitments then in effect. 

        (vi)  If
for any reason the Total Revolving Credit Outstandings at any time exceed the Aggregate Revolving Credit Commitments then in effect, Borrowers shall immediately
prepay Revolving Credit Loans and/or Cash Collateralize the L/C Obligations in an aggregate amount equal to such excess; provided,  however, that Borrowers
shall not be required to Cash Collateralize the L/C Obligations pursuant to this  Section 2.05(b)(vi) unless after the prepayment in full of the Revolving Credit Loans the Total Revolving Credit
Outstandings exceed the
Aggregate Revolving Credit Commitments then in effect. 

        (vii) If
for any reason the Total Acquisition Credit Outstandings at any time exceed the Aggregate Acquisition Credit Commitments then in effect, Borrowers shall immediately
prepay the Acquisition Credit Loans in an aggregate amount equal to such excess. 

        (viii)  Prepayments
of the Loans made pursuant to this Section 2.05(b) (other than prepayments made pursuant to  Section 2.05(b)(iv)),  first, shall be applied ratably to the outstanding
Acquisition Credit Loans which are Base Rate Loans, second, shall be applied ratably to the outstanding Acquisition Credit Loans which are Eurodollar
Rate Loans, third, shall be applied ratably to the L/C Borrowings, fourth, shall be applied ratably to
the outstanding Revolving Credit Loans, fifth, shall be used to Cash Collateralize the remaining L/C Obligations; and the amount remaining, if any,
after the prepayment in full of all L/C Borrowings and Loans outstanding at such time and the Cash Collateralization of the remaining L/C Obligations in full (the sum of such prepayment amounts, cash
collateralization amounts and remaining amount being, collectively, the "Reduction Amount") may be retained by the Borrower for use in the ordinary
course of its business, and the Revolving Credit Facility shall be automatically and permanently reduced by the Reduction Amount as set forth in  Section 2.06(b)(ii). Upon the drawing of any Letter
of Credit that has been Cash Collateralized, the funds held as Cash Collateral shall be
applied (without any further action by or notice to or from the Borrower or any other Loan Party) to reimburse the L/C Issuer or the Revolving Credit Lenders, as applicable. 

        2.06    Termination or Reduction of Commitments; Early Termination
Fee.    (a) Optional. Borrowers may, upon notice to Agent, terminate the Aggregate Commitments, or from time to time
permanently reduce the Aggregate Commitments; provided that (i) any such notice shall be received by Agent not
later than 11:00 a.m. five Business Days prior to the date of termination or reduction, (ii) any such partial reduction shall be in an aggregate amount of $5,000,000 or any whole
multiple of $1,000,000 in excess thereof, (iii) Borrowers shall not terminate or reduce the Aggregate Commitments if, after giving effect thereto and to any concurrent prepayments hereunder,
the Total Outstandings would exceed the Aggregate Commitments, (iv) Borrowers shall not terminate or reduce the Aggregate Revolving Credit Commitments if, after giving effect to any reduction
of the Aggregate Revolving Credit Commitments, the L/C Sublimit or the Swing Line Sublimit exceeds the amount of the Aggregate Revolving Credit Commitments, such Sublimit shall be automatically
reduced by the amount of such excess, and (v) Borrowers shall not terminate or reduce the Aggregate Acquisition Credit Commitments if, after giving effect thereto, and to any concurrent
prepayments hereunder, the Total Acquisition Credit Outstandings would exceed the Aggregate Acquisition Credit Commitments. Agent will promptly notify the Lenders of any such notice of termination or
reduction of the Aggregate Commitments. Any reduction of the Aggregate Commitments shall be applied to the Commitment of each applicable Lender according to its Applicable Percentage. 

37

 

        (b)   Mandatory.    (i) The Aggregate Commitments shall be automatically and permanently reduced on each date on
which the prepayment of Loans outstanding thereunder is required to be made pursuant to Section 2.05(b)(i),  (ii), or (iii)
 by an amount equal to the applicable Reduction Amount. The Aggregate Acquisition Credit
Commitments shall be automatically and permanently reduced on each date on which the prepayment of Loans outstanding thereunder is required to be made pursuant to  Section 2.05(b)(iv) by an amount
equal to the applicable Reduction Amount. 

        (ii)   If
after giving effect to any reduction or termination of the Revolving Credit Commitments under this  Section 2.06, the Letter of Credit Sublimit or the Swing Line Sublimit exceeds the Revolving
Credit Commitments at such time, the Letter of
Credit Sublimit or the Swing Line Sublimit, as the case may be, shall be automatically reduced by the amount of such excess. 

        (c)   Application of Commitment Reductions; Payment of Fees.    The Agent will promptly notify the Lenders of any
termination or reduction of the Letter of Credit Sublimit, the Swing Line Sublimit or any Commitments under this Section 2.06. Upon any reduction
of the Revolving Credit Commitments, the Revolving Credit Commitment of each Revolving Credit Lender shall be reduced by such Lender's Applicable Revolving Credit Percentage of such reduction amount.
Upon any reduction of the Acquisition Credit Commitments, the Acquisition Credit Commitment of each Acquisition Credit Lender shall be reduced by such Lender's Applicable Acquisition Credit Percentage
of such reduction amount. Upon any reduction of the Aggregate Commitments, the Aggregate Commitment of each Lender shall be reduced by such Lender's Applicable Percentage of such reduction amount. All
fees in respect of the Commitments accrued until the effective date of any termination of any portion of the Commitments shall be paid on the effective date of such termination. 

        (d)   Early Termination Fee.    Notwithstanding anything herein to the contrary, if the Borrowers terminate the
Commitments in full prior to the Maturity Date, Borrowers shall pay to Agent, for the account of each Lender in accordance with its Applicable Percentage, an early termination fee equal to One Hundred
Thousand Dollars ($100,000) (the "Early Termination Fee"). All fees, including the Early Termination Fee, accrued until the effective date of any
termination of the Aggregate Commitments shall be paid on the effective date of such termination. 

        2.07    Repayment of Principal.    (a) Borrowers shall jointly and
severally repay to Revolving Credit Lenders on the Maturity Date the aggregate principal amount of Committed Revolving Credit Loans outstanding on such date. 

        (b)   Borrowers
shall jointly and severally repay to Swing Line Lender each Swing Line Loan on the Maturity Date. 

        (c)   Beginning
on May 1, 2009 and on the 1st day of each month thereafter Borrowers shall jointly and severally repay to the Acquisition Credit
Lenders the principal amount of Committed Acquisition Credit Loans outstanding in twenty-three (23) consecutive monthly installments (each, a "Monthly Due
Date"), each equal to one-sixtieth (1/60) of the Total Acquisition Credit Outstandings as of the one (1) year anniversary of the date of this
Agreement. 

        (d)   A
final installment of all remaining outstanding principal on all Loans will be due on the Maturity Date, when all remaining principal and interest thereon shall be due
and payable in full. 

        2.08    Interest.    (a) Subject to the provisions of
subsection (b) below, (i) each Eurodollar Rate Loan shall bear interest on the outstanding principal amount thereof for each Interest Period at a rate per annum equal to the Eurodollar
Rate for such Interest Period plus the Applicable Rate; (ii) each Base Rate Committed Loan shall bear interest on the outstanding principal
amount thereof from the applicable borrowing date at a rate per annum equal to the Base Rate plus the Applicable Rate; and (iii) each Swing Line
Loan shall bear interest on the outstanding principal amount thereof from the applicable borrowing date at a rate per annum equal to the Base Rate plus
the Applicable Rate. 

38

 

        (b)   (i)
If any amount of principal of any Loan is not paid when due (without regard to any applicable grace periods), whether at stated maturity, by acceleration or
otherwise, such amount shall thereafter bear interest at a fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted by applicable Laws. 

        (ii)   If
any amount (other than principal of any Loan) payable by Borrowers under any Loan Document is not paid when due (without regard to any applicable grace periods),
whether at stated maturity, by acceleration or otherwise, then upon the request of the Required Lenders, such amount shall thereafter bear interest at a fluctuating interest rate per annum at all
times equal to the Default Rate to the fullest extent permitted by applicable Laws. 

        (iii)  Upon
the request of the Required Lenders, while any Event of Default exists, Borrowers shall pay interest on the principal amount of all outstanding Obligations
hereunder at a fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted by applicable Laws. 

        (iv)  Accrued
and unpaid interest on past due amounts (including interest on past due interest) shall be due and payable upon demand. 

        (c)   Interest
on each Loan shall be due and payable in arrears on each Interest Payment Date applicable thereto and at such other times as may be specified herein. Interest
hereunder shall be due and payable in accordance with the terms hereof before and after judgment, and before and after the commencement of any proceeding under any Debtor Relief Law. 

        2.09    Fees.    In addition to certain fees described in
subsections (i) and (j) of Section 2.03 and subsection (d) of  Section 2.06: 

        (a)   Unused Line Fee.    Borrowers shall jointly and severally pay to Agent for the account of each Lender in
accordance with its Applicable Percentage, an unused line fee equal to one quarter of one percent (0.25%) of the actual daily amount by which the Aggregate Commitments exceed the sum of (i) the
Outstanding Amount of Committed Loans and (ii) the Outstanding Amount of L/C Obligations. The unused line fee shall accrue at all times during the Availability Period, including at any time
during which one or more of the conditions in Article IV is not met, and shall be due and payable monthly in arrears on the last Business Day of
each calendar month, commencing with the first such date to occur after the Closing Date, and on the last day of the Availability Period. The unused line fee shall be calculated monthly in arrears,
and if there is any change in the Applicable Rate during any quarter, the actual daily amount shall be computed and multiplied by the Applicable Rate separately for each period during such quarter
that such Applicable Rate was in effect. For purposes of computing the unused line fee, Swing Line Loans shall not be counted towards or considered usage of the Aggregate Commitments. 

        (b)   Agent's Fees.    Borrowers shall jointly and severally pay to Agent for Agent's own account, fees in the
amounts and at the times specified in the letter agreement of even date herewith (the "Agent Fee Letter"), between Borrowers and Agent. Such fees shall
be fully earned when paid and shall be nonrefundable for any reason whatsoever. 

        2.10    Computation of Interest and Fees; Retroactive Adjustments of Applicable
Rate.    (a) All computations of interest for Base Rate Loans when the Base Rate is determined by Bank of America's "prime rate" shall be made on the basis of a year
of 360 days and actual days elapsed. All other computations of fees and interest shall be made on the basis of a 360-day year and actual days elapsed (which results in more fees or
interest, as applicable, being paid than if computed on the basis of a 365-day year). Interest shall accrue on each Loan for the day on which the Loan is made, and shall not accrue on a
Loan, or any portion thereof, for the day on which the Loan or such portion is paid, provided that any Loan that is repaid on the same day on which it
is made shall, subject to 

39

 

 Section 2.12(a), bear interest for one day. Each determination by Agent of an interest rate or fee hereunder shall be conclusive and binding for all purposes, absent
manifest error. 

        (b)   If,
as a result of any restatement of or other adjustment to the financial statements of Borrowers or for any other reason, Borrowers or the Lenders determine that
(i) the Financial Covenant used in the definition "Applicable Rate" as calculated by Borrowers as of any applicable date was inaccurate and
(ii) a proper calculation of such Financial Covenant would have resulted in higher pricing for such period, Borrowers shall immediately and retroactively be obligated to pay to Agent for the
account of the applicable Lenders or the L/C Issuer, promptly on demand by Agent (or, after the occurrence of an actual or deemed entry of an order for relief with respect to Borrowers under the
Bankruptcy Code of the United States, automatically and without further action by Agent, any Lender or the L/C Issuer), an amount equal to the excess of the amount of interest and fees that should
have been paid for such period over the amount of interest and fees actually paid for such period. This paragraph shall not limit the rights of Agent, any Lender or the L/C Issuer, as the case may be,
under Section 2.03(c)(iii), 2.03(i) or 2.08(b) or under  Article VIII. Borrowers' obligations under this paragraph shall survive the termination of the Aggregate Commitments and the repayment of all
other Obligations hereunder. 

        2.11    Evidence of Debt.    (a) The Credit Extensions made by each
Lender shall be evidenced by one or more accounts or records maintained by such Lender and by Agent in the ordinary course of business. The accounts or records maintained by Agent and each Lender
shall be conclusive absent manifest error of the amount of the Credit Extensions made by Lenders to Borrowers and the interest and payments thereon. Any failure to so record or any error in doing so
shall not, however, limit or otherwise affect the obligation of Borrowers hereunder to pay any amount owing with respect to the Obligations. In the event of any conflict between the accounts and
records maintained by any Lender and the accounts and records of Agent in respect of such matters, the accounts and records of Agent shall control in the absence of manifest error. Upon the request of
any Lender made through Agent, Borrowers shall execute and deliver to such Lender (through Agent) a Note, which shall evidence such Lender's Loans in addition to such accounts or records. Each Lender
may attach schedules to its Note and endorse thereon the date, Type (if applicable), amount and maturity of its Loans and payments with respect thereto. 

        (b)   In
addition to the accounts and records referred to in subsection (a), each Lender and Agent shall maintain in accordance with its usual practice accounts or
records evidencing the purchases and sales by such Lender of participations in Letters of Credit and Swing Line Loans. In the event of any conflict between the accounts and records maintained by Agent
and the accounts and records of any Lender in respect of such matters, the accounts and records of Agent shall control in the absence of manifest error. 

        2.12    Payments Generally; Agent's Clawback.    (a)  General. All payments
to be made by Borrowers shall be made without condition or deduction for any counterclaim, defense, recoupment or setoff. Except
as otherwise expressly provided herein, all payments by Borrowers hereunder shall be made to Agent, for the account of the respective Lenders to which such payment is owed, at the Administrative
Agent's Office in Dollars and in immediately available funds not later than 12:00 noon on the date specified herein. Agent will promptly distribute to each Lender its Applicable Percentage (or other
applicable share as provided herein) of such payment in like funds as received by wire transfer to such Lender's Lending Office. All payments received by Agent after 12:00 noon shall be deemed
received on the next succeeding Business Day and any applicable interest or fee shall continue to accrue. If any payment to be made by Borrowers shall come due on a day other than a Business Day,
payment shall be made on the next following Business Day, and such extension of time shall be reflected in computing interest or fees, as the case may be. 

40

 

        (b)   (i)
Funding by Lenders; Presumption by Agent. Unless Agent shall have received notice from a Lender prior to the proposed
date of any Committed Borrowing of Eurodollar Rate Loans (or, in the case of any Committed Borrowing of Base Rate Loans, prior to 12:00 noon on the date of such Committed Borrowing) that such Lender
will not make available to Agent such Lender's share of such Committed Borrowing, Agent may assume that such Lender has made such share available on such date in accordance with Section 2.02
(or, in the case of a Committed Borrowing of Base Rate Loans, that such Lender has made such share available in accordance with and at the time required by Section 2.02) and may, in reliance
upon such assumption, make available to Borrowers a corresponding amount. In such event, if a Lender has not in fact made its share of the applicable Committed Borrowing available to Agent, then the
applicable Lender and Borrowers severally agree to pay to Agent forthwith on demand such corresponding amount in immediately available funds with interest thereon, for each day from and including the
date such amount is made available to Borrowers to but excluding the date of payment to Agent, at (A) in the case of a payment to be made by such Lender, the greater of the Federal Funds Rate
and a rate determined by Agent in accordance with banking industry rules on interbank compensation, plus any administrative, processing or similar fees customarily charged by Agent in connection with
the foregoing and (B) in the case of a payment to be made by Borrowers, the interest rate applicable to Base Rate Loans. If Borrowers and such Lender shall pay such interest to Agent for the
same or an overlapping period, Agent shall promptly remit to Borrowers the amount of such interest paid by Borrowers for such period. If such Lender pays its share of the applicable Committed
Borrowing to Agent, then the amount so paid shall constitute such Lender's Committed Loan included in such Committed Borrowing. Any payment by Borrowers shall be without prejudice to any claim
Borrowers may have against a Lender that shall have failed to make such payment to Agent. 

        (ii)   Payments by Borrowers; Presumptions by Agent.    Unless Agent shall have received notice from Borrowers prior
to the date on which any payment is due to Agent for the account of the Lenders or the L/C Issuer hereunder that Borrowers will not make such payment, Agent may assume that Borrowers have made such
payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to Lenders or the L/C Issuer, as the case may be, the amount due. In such event, if Borrowers have not
in fact made such payment, then each of Lenders or the L/C Issuer, as the case may be, severally agrees to repay to Agent forthwith on demand the amount so distributed to such Lender or the L/C
Issuer, in immediately available funds with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to Agent, at the greater of
the Federal Funds Rate and a rate determined by Agent in accordance with banking industry rules on interbank compensation. A notice of Agent to any Lender or Borrowers with respect to any amount owing
under this subsection (b) shall be conclusive, absent manifest error. 

        (c)   Failure to Satisfy Conditions Precedent.    If any Lender makes available to Agent funds for any Loan to be
made by such Lender as provided in the foregoing provisions of this Article II, and such funds are not made available to Borrowers by Agent
because the conditions to the applicable Credit Extension set forth in Article IV are not satisfied or waived in accordance with the terms
hereof, Agent shall return such funds (in like funds as received from such Lender) to such Lender, without interest. 

        (d)   Obligations of Lenders Several.    The obligations of Lenders hereunder to make Committed Loans, to fund
participations in Letters of Credit and Swing Line Loans and to make payments under Section 10.04(c) are several and not joint. The failure of
any Lender to make any Committed Loan, to fund any such participation or to make any payment under Section 10.04(c) on any date required
hereunder shall not relieve any other Lender of its corresponding obligation to do so on such date, and no Lender shall be responsible for the failure of any other Lender to so make its Committed
Loan, purchase its participation or to make its payment under Section 10.04(c).  

41

 

         (e)   Funding Source.    Nothing herein shall be deemed to obligate any Lender to obtain the funds for any Loan in any
particular place or
manner or to constitute a representation by any Lender that it has obtained or will obtain the funds for any Loan in any particular place or manner. 

        2.13    Sharing of Payments.    If any Lender shall, by exercising any
right of setoff or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of the Committed Loans made by it, or the participations in L/C Obligations or in Swing
Line Loans held by it resulting in such Lender's receiving payment of a proportion of the aggregate amount of such Committed Loans or participations and accrued interest thereon greater than its  pro rata share thereof as provided herein, then the Lender receiving such greater proportion shall (a) notify Agent of such fact, and
(b) purchase (for cash at face value) participations in the Committed Loans and subparticipations in L/C Obligations and Swing Line Loans of the other Lenders, or make such other adjustments as
shall be equitable, so
that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Committed Loans and other
amounts owing them, provided that: 

        (i)    if
any such participations or subparticipations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations or
subparticipations shall be rescinded and the purchase price restored to the extent of such recovery, without interest; and 

        (ii)   the
provisions of this Section shall not be construed to apply to (x) any payment made by Borrowers pursuant to and in accordance with the express terms of this
Agreement or (y) any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Committed Loans or subparticipations in L/C Obligations or
Swing Line Loans to any assignee or participant, other than to Borrowers or any Subsidiary thereof (as to which the provisions of this Section shall apply). 

        Each
Loan Party consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a participation pursuant to the foregoing
arrangements may exercise against such Loan Party rights of setoff and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of such Loan Party in the
amount of such participation. 

 
 

ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY    
    

        3.01    Taxes.    (a) Payments Free of
Taxes.    Any and all payments by Borrowers to or on account of any obligation of Borrowers hereunder or under any other Loan Document shall be made free and clear of
and without reduction or withholding for any Indemnified Taxes or Other Taxes, provided that if Borrowers shall be required by any applicable law to deduct any Indemnified Taxes (including any Other
Taxes) from such payments, then, (i) the sum payable shall be increased as necessary so that after making all required deductions (including deductions applicable to additional sums payable
under this Section), Agent, Lender or L/C Issuer, as the case may be, receives an amount equal to the sum it would have received had no such deductions been made, (ii) Borrowers shall make such
deductions, and (iii) Borrowers shall timely pay the full amount deducted to the relevant Governmental Authority in accordance with applicable law. 

        (b)   Payment of Other Taxes by Borrowers.    Without limiting the provisions of subsection (a) above,
Borrowers shall timely pay any Other Taxes to the relevant Governmental Authority in accordance with applicable law. 

        (c)   Indemnification by Borrowers.    Borrowers shall indemnify Agent, each Lender and the L/C Issuer, within
10 days after demand therefor, for the full amount of any Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable
under this Section) paid by Agent, such Lender or the L/C Issuer, as the case may be, and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not 

42

 

such
Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to
Borrowers by a Lender or the L/C Issuer (with a copy to Agent), or by Agent on its own behalf or on behalf of a Lender or the L/C Issuer, shall be conclusive absent manifest error. 

        (d)   Evidence of Payments.    As soon as practicable after any payment of Indemnified Taxes or Other Taxes by
Borrowers to a Governmental Authority, Borrowers shall deliver to Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the
return reporting such payment or other evidence of such payment reasonably satisfactory to Agent. 

        (e)   Status of Lenders.    Any Lender, if requested by Borrowers or Agent, shall deliver such documentation
prescribed by applicable law or reasonably requested by Borrowers or Agent as will enable Borrowers or Agent to determine whether or not such Lender is subject to backup withholding or information
reporting requirements. 

        (f)    Treatment of Certain Refunds.    If Agent, any Lender or the L/C Issuer determines, in its sole discretion,
that it has received a refund of any Taxes or Other Taxes as to which it has been indemnified by Borrowers or with respect to which Borrowers have paid additional amounts pursuant to this Section, it
shall pay to Borrowers an amount equal to such refund (but only to the extent of indemnity payments made, or additional amounts paid, by Borrowers under this Section with respect to the Taxes or Other
Taxes giving rise to such refund), net of all out-of-pocket expenses of Agent, such Lender or the L/C Issuer, as the case may be, and without interest (other than any interest
paid by the relevant Governmental Authority with respect to such refund), provided that Borrowers, upon the request of Agent, such Lender or the L/C
Issuer, agree to repay the amount paid over to Borrowers (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) to Agent, such Lender or the L/C Issuer in the
event Agent, such Lender or the L/C Issuer is required to repay such refund to such Governmental Authority. This subsection shall not be construed to require Agent, any Lender or the L/C Issuer to
make available its tax returns (or any other information relating to its taxes that it deems confidential) to Borrowers or any other Person. 

        3.02    Illegality.    If any Lender determines that any Law has made
it unlawful, or that any Governmental Authority has asserted that it is unlawful, for any Lender or its applicable Lending Office to make, maintain or fund Eurodollar Rate Loans, or to determine or
charge interest rates based upon the Eurodollar Rate, or any Governmental Authority has imposed material restrictions on the authority of such Lender to purchase or sell, or to take deposits of,
Dollars in the London interbank market, then, on notice thereof by such Lender to Borrowers through Agent, any obligation of such Lender to make
or continue Eurodollar Rate Loans or to convert Base Rate Committed Loans to Eurodollar Rate Loans shall be suspended until such Lender notifies Agent and Borrowers that the circumstances giving rise
to such determination no longer exist. Upon receipt of such notice, Borrowers shall, upon demand from such Lender (with a copy to Agent), prepay or, if applicable, convert all Eurodollar Rate Loans of
such Lender to Base Rate Loans, either on the last day of the Interest Period therefor, if such Lender may lawfully continue to maintain such Eurodollar Rate Loans to such day, or immediately, if such
Lender may not lawfully continue to maintain such Eurodollar Rate Loans. Upon any such prepayment or conversion, Borrowers shall also pay accrued interest on the amount so prepaid or converted and all
amounts due under Section 3.05 in accordance with the terms thereof due to such prepayment or conversion. 

        3.03    Inability to Determine Rates.    If Agent determines in
connection with any request for a Eurodollar Rate Loan or a conversion to or continuation thereof that (a) Dollar deposits are not being offered to banks in the London interbank eurodollar
market for the applicable amount and Interest Period of such Eurodollar Rate Loan, (b) adequate and reasonable means do not exist for determining the Eurodollar Base Rate for any requested
Interest Period with respect to a proposed Eurodollar Rate 

43

 

Loan,
or (c) the Eurodollar Base Rate for any requested Interest Period with respect to a proposed Eurodollar Rate Loan does not adequately and fairly reflect the cost to such Lenders of
funding such Loan, Agent will promptly so notify Borrowers and each Lender. Thereafter, the obligation of Lenders to make or maintain Eurodollar Rate Loans shall be suspended until Agent (upon the
instruction of the Required Lenders) revokes such notice. Upon receipt of such notice, Borrowers may revoke any pending request for a Borrowing of, conversion to or continuation of Eurodollar Rate
Loans or, failing that, will be deemed to have converted such request into a request for a Committed Borrowing of Base Rate Loans in the amount specified therein. 

        3.04    Increased Costs.    (a) Increased
Costs Generally.    If any Change in Law shall: 

        (i)    impose,
modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the
account of, or credit extended or participated in by, any Lender (except any reserve requirement reflected in the Eurodollar Rate) or the L/C Issuer; 

        (ii)   subject
any Lender or the L/C Issuer to any tax of any kind whatsoever with respect to this Agreement, any Letter of Credit, any participation in a Letter of Credit or
any Eurodollar Rate Loan made by it, or change the basis of taxation of payments to such Lender or the L/C Issuer in respect thereof (except for Indemnified Taxes or Other Taxes covered by  Section 3.01 and the imposition of, or any change in the rate of, any Excluded Tax payable by such Lender or the L/C Issuer); or 

        (iii)  impose
on any Lender or the L/C Issuer or the London interbank market any other condition, cost or expense affecting this Agreement or Eurodollar Rate Loans made by
such Lender or any Letter of Credit or participation therein; 

and
the result of any of the foregoing shall be to increase the cost to such Lender of making or maintaining any Eurodollar Rate Loan (or of maintaining its obligation to make any such Loan), or to
increase the cost to such Lender or the L/C Issuer of participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of
Credit), or to reduce the amount of any sum received or receivable by such Lender or the L/C Issuer hereunder (whether of principal, interest or any other amount) then, upon request of such Lender or
the L/C Issuer, Borrowers will pay to such Lender or the L/C Issuer, as the case may be, such additional amount or amounts as will compensate such Lender or the L/C Issuer, as the case may be, for
such additional costs incurred or reduction suffered. 

        (b)   Capital Requirements.    If any Lender or the L/C Issuer determines that any Change in Law affecting such
Lender or the L/C Issuer or any Lending Office of such Lender or such Lender's or the L/C Issuer's holding company, if any, regarding capital requirements has or would have the effect of reducing the
rate of return on such Lender's or the L/C Issuer's capital or on the capital of such Lender's or the L/C Issuer's holding company, if any, as a consequence of this Agreement, the Commitments of such
Lender or the Loans made by, or participations in Letters of Credit held by, such Lender, or the Letters of Credit issued by the L/C Issuer, to a level below that which such Lender or the L/C Issuer
or such Lender's or the L/C Issuer's holding company could have achieved but for such Change in Law (taking into consideration such Lender's or the L/C Issuer's policies and the policies of such
Lender's or the L/C Issuer's holding company with respect to capital adequacy), then from time to time Borrowers will pay to such Lender or the L/C Issuer, as the case may be, such additional amount
or amounts as will compensate such Lender or the L/C Issuer or such Lender's or the L/C Issuer's holding company for any such reduction suffered. 

        (c)   Certificates for Reimbursement.    A certificate of a Lender or the L/C Issuer setting forth the amount or
amounts necessary to compensate such Lender or the L/C Issuer or its holding company, as the case may be, as specified in subsection (a) or (b) of this Section and delivered to Borrowers
shall 

44

 

be
conclusive absent manifest error. Borrowers shall pay such Lender or the L/C Issuer, as the case may be, the amount shown as due on any such certificate within 10 days after receipt thereof. 

        (d)   Delay in Requests.    Failure or delay on the part of any Lender or the L/C Issuer to demand compensation
pursuant to the foregoing provisions of this Section shall not constitute a waiver of such Lender's or the L/C Issuer's right to demand such compensation,  provided that Borrowers shall not be required
to compensate a Lender or the L/C Issuer pursuant to the foregoing provisions of this Section for any
increased costs incurred or reductions suffered more than nine months prior to the date that such Lender or the L/C Issuer, as the case may be, notifies Borrowers of the Change in Law giving rise to
such increased costs or reductions and of such Lender's or the L/C Issuer's intention to claim compensation therefor (except that, if the Change in Law giving rise to such increased costs or
reductions is retroactive, then the nine-month period referred to above shall be extended to include the period of retroactive effect thereof). 

        3.05    Compensation for Losses.    Upon demand of any Lender (with a
copy to Agent) from time to time, Borrowers shall promptly compensate such Lender for and hold such Lender harmless from any loss, cost or expense incurred by it as a result of: 

        (a)   any
continuation, conversion, payment or prepayment of any Loan other than a Base Rate Loan on a day other than the last day of the Interest Period for such Loan
(whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise); or 

        (b)   any
failure by Borrowers (for a reason other than the failure of such Lender to make a Loan) to prepay, borrow, continue or convert any Loan other than a Base Rate Loan
on the date or in the amount notified by Borrowers; 

including
any loss of anticipated profits and any loss or expense arising from the liquidation or reemployment of funds obtained by it to maintain such Loan or from fees payable to terminate the
deposits from which such funds were obtained. Borrowers shall also pay any customary administrative fees charged by such Lender in connection with the foregoing. For purposes of calculating amounts
payable by Borrowers to Lenders under this Section 3.05, each Lender shall be deemed to have funded each Eurodollar Rate Loan made by it at the
Eurodollar Base Rate used in determining the Eurodollar Rate for such Loan by a matching deposit or other borrowing in the London interbank eurodollar market for a comparable amount and for a
comparable period, whether or not such Eurodollar Rate Loan was in fact so funded. 

        3.06    Mitigation Obligations.    If any Lender requests compensation
under Section 3.04, or Borrowers is required to pay any additional amount to any Lender or any Governmental Authority for the account of any
Lender pursuant to Section 3.01, or if any Lender gives a notice pursuant to Section 3.02,
then such Lender shall use reasonable efforts to designate a different Lending Office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its
offices, branches or affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to  Section 3.01 or 3.04, as the case may be, in the future, or eliminate the need for the notice
pursuant to Section 3.02, as applicable, and (ii) in each case, would not subject such Lender to any unreimbursed cost or expense and
would not otherwise be disadvantageous to such Lender. Borrowers hereby agree to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment. 

        3.07    Survival.    All of Borrowers' obligations under this  Article III shall survive termination of the Aggregate Commitments and repayment of all other Obligations hereunder. 

45

 

 

 
 

ARTICLE IV. CONDITIONS PRECEDENT TO CREDIT EXTENSIONS    
    

        4.01    Conditions of Initial Credit Extension.    The obligation of
the L/C Issuer and each Lender to make its initial Credit Extension hereunder is subject to satisfaction of the following conditions precedent: 

        (a)   Agent's
receipt of the following, each of which shall be originals or telecopies (followed promptly by originals) unless otherwise specified, each properly executed by a
Responsible Officer of the signing Loan Party, each dated the Closing Date (or, in the case of certificates of governmental officials, a recent date before the Closing Date) and each in form and
substance satisfactory to Agent and each of the Lenders: 

        (i)    executed
counterparts of this Agreement, sufficient in number for distribution to Agent, each Lender and Borrowers; 

        (ii)   a
Note executed by Borrowers in favor of each Lender requesting a Note; 

        (iii)  the
Security Agreement, duly executed by each Loan Party, together with: 

        (A)  certificates
representing the Pledged Equity referred to therein accompanied by undated stock powers executed in blank and instruments evidencing any Intercompany Notes
indorsed in blank, 

        (B)  acknowledgment
copies or stamped receipt copies of proper financing statements, duly filed on or before the day of the initial Credit Extension under the Uniform
Commercial Code of all jurisdictions that the Agent may deem necessary or desirable in order to perfect the Liens created under the Security Agreement, covering the Collateral described in the
Security Agreement, 

        (C)  completed
requests for information, dated on or before the date of the initial Credit Extension, listing all effective financing statements filed in the jurisdictions
referred to in clause (B) above that name any Loan Party as debtor, together with copies of such other financing statements, 

        (D)  evidence
of the completion of all other actions, recordings and filings of or with respect to the Security Agreement that the Agent may deem necessary or desirable in
order to perfect the Liens created thereby, 

        (E)  the
Account Control Agreements, in each case as referred to in the and Security Agreement and duly executed by the appropriate parties, 

        (F)  evidence
that all other action that the Agent may deem necessary or desirable in order to perfect the Liens created under the Security Agreement has been taken
(including receipt of duly executed payoff letters, UCC-3 termination statements and landlords' and bailees' waiver and consent agreements); and 

        (G)  executed
counterparts of any other Collateral Documents; 

        (iv)  a
Landlord Waiver with respect to each location set forth on Schedule 4.01(a)(iv); 

        (v)   the
IP Security Agreements, duly executed by each applicable Loan Party, together with evidence that all action that the Agent may deem necessary or desirable in order
to perfect the Liens created under the IP Security Agreements has been taken; 

        (vi)  executed
counterparts of any other Loan Documents; 

        (vii) such
certificates of resolutions or other action, incumbency certificates and/or other certificates of Responsible Officers of each Loan Party as Agent may require
evidencing the identity, authority and capacity of each Responsible Officer thereof authorized to act as a 

46

 

Responsible
Officer in connection with this Agreement and the other Loan Documents to which such Loan Party is a party; 

        (viii)  such
documents and certifications as Agent may reasonably require to evidence that each Loan Party is duly organized or formed, and that each Loan Party is validly
existing, in good standing and qualified to engage in business in each jurisdiction where its ownership, lease or operation of properties or the conduct of its business requires such qualification,
except to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect; 

        (ix)  a
favorable opinion of counsel to the Loan Parties acceptable to Agent addressed to Agent and each Lender, as to the matters set forth concerning the Loan Parties and
the Loan Documents in form and substance satisfactory to Agent; 

        (x)   a
certificate of a Responsible Officer of each Loan Party either (A) attaching copies of all consents, licenses and approvals required in connection with the
execution, delivery and performance by such Loan Party and the validity against such Loan Party of the Loan Documents to which it is a party, and such consents, licenses and approvals shall be in full
force and effect, or (B) stating that no such consents, licenses or approvals are so required; 

        (xi)  a
certificate signed by a Responsible Officer of Borrowers certifying (A) that the conditions specified in  Sections 4.02(a) and (b) have been
satisfied, and (B) that there has been no event or
circumstance since the date of the Audited Financial Statements that has had or could be reasonably expected to have, either individually or in the aggregate, a Material Adverse Effect; 

        (xii) a
copy of the earnings forecasts for the Borrowers and their Subsidiaries on a consolidated basis, prepared by management of SI Holdings, of consolidated balance
sheets and statements of income or operations and cash flows of the Borrowers and their Subsidiaries on a monthly basis for the first year following the Closing Date and on a quarterly basis for each
year thereafter through 2011; 

        (xiii)  certificates
attesting to the Solvency of each Loan Party before and after giving effect to the transactions contemplated hereby, from its chief financial officer; 

        (xiv)   evidence
that all insurance required to be maintained pursuant to the Loan Documents has been obtained and is in effect, together with the certificates
of insurance, naming the Agent, on behalf of the Lenders, as an additional insured or loss payee, as the case may be, under all insurance policies maintained with respect to the assets and properties
of the Loan Parties that constitutes Collateral; 

        (xv)   a
duly completed Compliance Certificate as of the last day of the fiscal quarter of Borrowers most recently ended prior to the Closing Date, signed by a
Responsible Officer of Borrowers; and 

        (xvi)   such
other assurances, certificates, documents, consents or opinions as Agent, the L/C Issuer, Swing Line Lender or the Required Lenders reasonably may
require. 

        (b)   Any
fees required to be paid to Agent or Lenders on or before the Closing Date shall have been paid. 

        (c)   Unless
waived by Agent, Borrowers shall have paid all fees, charges and disbursements of counsel to Agent (directly to such counsel if requested by Agent) to the extent
invoiced prior to or on the Closing Date, plus such additional amounts of such fees, charges and disbursements as shall constitute its reasonable estimate of such fees, charges and disbursements
incurred or to be incurred by it through the closing proceedings (provided that such estimate shall not thereafter preclude a final settling of accounts between Borrowers and Agent). 

        (d)   The
Closing Date shall have occurred on or before April 14, 2008. 

47

 

        (e)   Simultaneously
with the closing of the transactions contemplated by this Agreement, Borrowers shall execute a Swap Contract or other hedging agreement with Bank of
America, on terms mutually acceptable to Borrowers and Bank of America, the effect of which would be to place a limit upon the interest payable by Borrowers in an amount no less than Ten Million
Dollars ($10,000,000) for a period of three (3) years. 

Without
limiting the generality of the provisions of the last sentence of Section 9.03(d), for purposes of determining compliance with the
conditions specified in this Section 4.01, each Lender that has signed this Agreement shall be deemed to have consented to, approved or accepted
or to be satisfied with, each document or other matter required thereunder to be consented to or approved by or acceptable or satisfactory to a Lender unless Agent shall have received notice from such
Lender prior to the proposed Closing Date specifying its objection thereto. 

        4.02    Conditions to all Credit Extensions.    The obligation of each
Lender to honor any Request for Credit Extension is subject to the following conditions precedent: 

        (a)   The
representations and warranties of Borrowers and each other Loan Party contained in Article V or any other Loan
Document, or which are contained in any document furnished at any time under or in connection herewith or therewith, shall be true and correct on and as of the date of such Credit Extension, except to
the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct in all material respects as of such earlier date, and except
that for purposes of this Section 4.02, the representations and warranties contained in subsections (a) and (b) of  Section 5.05 shall
be deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b), respectively, of  Section 6.01. 

        (b)   No
Default shall exist, or would result from such proposed Credit Extension or from the application of the proceeds thereof. 

        (c)   Agent
and, if applicable, the L/C Issuer or Swing Line Lender shall have received a Request for Credit Extension in accordance with the requirements hereof. 

        (d)   Agent
shall have received, in form and substance satisfactory to it, such other assurances, certificates, documents or consents related to the foregoing as Agent or the
Required Lenders reasonably may require. 

Each
Request for Credit Extension submitted by Borrowers shall be deemed to be a representation and warranty that the conditions specified in  Sections 4.02(a) and (b)
 have been satisfied on and as of the date of the applicable Credit
Extension. 

        4.03    Conditions to Credit Extension for Kiddopotamus Merger.    The
obligation of the Acquisition Credit Lenders to make the Acquisition Credit Loans in respect to the Kiddopotamus Merger is subject to the satisfaction of the following conditions on the closing date
of the Kiddopotamus Merger (unless otherwise waived by the Agent and Lenders), which date shall not be later than the expiration of the Acquisition Credit Availability Period: 

        (a)   All
conditions set forth in Section 4.01 (to the extent not previously satisfied with respect to the Kiddopotamus
Merger) and Section 4.02 shall have been satisfied. 

        (b)   The
Borrowers or the appropriate Loan Party shall have executed and delivered to the Agent (or shall have caused to be executed and delivered to the Agent by the
appropriate Persons) the following (each of which shall be in form and substance satisfactory to the Agent and the Required Lenders): 

        (i)    To
the extent not previously delivered, true and correct copies of all material consents, contracts, licenses, instruments and other documents assumed or acquired in the
Kiddopotamus Merger; 

48

 

        (ii)   Certificates
of insurance evidencing all insurance coverage and policy provisions required in this Agreement and Collateral Documents; 

        (iii)  A
pay-off letter (including therein provisions reasonably acceptable to the Agent for the delivery or filing of appropriate UCC termination statements and
mortgage and lien releases) from all lenders and creditors of Kiddopotamus; 

        (iv)  A
properly completed Request for Credit Extension in accordance with the requirements of this Agreement; 

        (v)   An
Officer's Certificate of SI USA stating that the Kiddopotamus Merger will be consummated immediately upon funding of the Acquisition Credit Loans; and 

        (vi)  Such
other supporting documents and certificates as the Agent may reasonably request. 

        (c)   All
legal matters incident to the transactions hereby contemplated shall be reasonably satisfactory to special counsel for the Agent and the Lenders. 

        (d)   The
Kiddopotamus Merger shall become effective in accordance with the terms of the Kiddopotamus Acquisition Agreement, the Kiddopotamus Articles of Merger and the laws
of the State of Rhode Island, on the date of funding immediately following funding of the Acquisition Credit Loans. 

        (e)   Neither
an Event of Default nor a Default shall have occurred and be then continuing, or shall result after taking into consideration the effect of the requested
Acquisition Credit Loan and the Kiddopotamus Merger. 

        (f)    The
Borrowers shall have paid to the Agent all reasonable fees required to be paid on the closing date of the Kiddopotamus Acquisition pursuant to this Agreement. 

        (g)   In
addition to the foregoing requirements: 

        (i)    The
transactions contemplated by the Kiddopotamus Purchase Agreement shall have been previously consummated or shall be consummated contemporaneously with such
Acquisition Credit Loans in accordance with the terms thereof and, in any event, in a manner reasonably satisfactory to the Agent and the Required Lenders, including, without limitation, the
satisfaction in full (simultaneously with, and from the proceeds of, the Acquisition Credit Loan or otherwise) of all Indebtedness of Kiddopotamus secured by the assets and properties transferred
under the Kiddopotamus Purchase Agreement which is not being assumed by SI USA. 

        (ii)   The
Agent shall have received reasonable evidence of the Borrowers' ability to consummate receipt at closing of all permits, approvals and consents, if any, required
with respect to the Kiddopotamus Merger and any other related transaction contemplated by this Agreement. 

        (iii)  The
Agent shall have received copies of any legal opinions delivered by Kiddopotamus pursuant to the Kiddopotamus Purchase Agreement in connection with the
Kiddopotamus Merger. 

        (iv)  There
shall not have occurred, in the Agent's reasonable opinion, any change in the financial condition, management or business operations, or the assets or business
of, Kiddopotamus since the Closing Date that could reasonably be expected to have a Material Adverse Effect. 

        (v)   At
the time of consummation of the Kiddopotamus Merger, the Borrowers shall update all Schedules to this Agreement to reflect changes thereto since the Closing Date,
after giving effect to the Kiddopotamus Merger. 

        (h)   The
aggregate amount of the Acquisition Credit Loans funded in connection with the Kiddopotamus Merger shall not be greater than an amount calculated as the Aggregate
Acquisition 

49

 

Credit
Commitments minus the aggregate principal amount of the Acquisition Credit Loans attributable to and used to fund the Basic Comfort Acquisition,
which Loans shall be used solely to pay a portion of the purchase price of the Equity Interests in Kiddopotamus and related closing costs in the Kiddopotamus Merger. 

        (i)    The
Lenders shall have completed a due diligence investigation of Kiddopotamus, and its Subsidiaries (if any) in scope, and with results, satisfactory to the Lenders,
and shall have been given such access to the management, records, books of account, contracts and properties of Kiddopotamus and its Subsidiaries and shall have received such financial, business and
other information regarding each of the foregoing Persons and businesses as they shall have requested, and such other due diligence reports, audits, and certifications as they may reasonably request. 

 
 

ARTICLE V. REPRESENTATIONS AND WARRANTIES    
    

        Borrowers represent and warrant to Agent and the Lenders that: 

        5.01    Existence, Qualification and Power.    Each Loan Party and
each Subsidiary thereof (a) is duly organized or formed, validly existing and, as applicable, in good standing under the Laws of the jurisdiction of its incorporation or organization,
(b) has all requisite power and authority and all requisite governmental licenses, authorizations, consents and approvals to (i) own or lease its assets and carry on its business and
(ii) execute, deliver and perform its obligations under the Loan Documents to which it is a party, and (c) is duly qualified and is licensed and, as applicable, in good standing under
the Laws of each jurisdiction where its ownership, lease or operation of properties or the conduct of its business requires such qualification or license; except in each case referred to in
clause (b)(i), or (c), to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect. 

        5.02    Authorization; No Contravention.    The execution, delivery
and performance by each Loan Party of each Loan Document to which such Person is party, have been duly authorized by all necessary corporate or other organizational action, and do not and will not
(a) contravene the terms of any of such Person's Organization Documents; (b) conflict with or result in any breach or contravention of, or the creation of any Lien under, or require any
payment to be made under (i) any Contractual Obligation to which such Person is a party or affecting such Person or the properties of such Person or any of its Subsidiaries or (ii) any
order, injunction, writ or decree of any Governmental Authority or any arbitral award to which such Person or its property is subject; or (c) violate any Law. 

        5.03    Governmental Authorization; Other Consents.    No approval,
consent, exemption, authorization, or other action by, or notice to, or filing with, any Governmental Authority or any other Person is necessary or required in connection with the execution, delivery
or performance by, or enforcement against, any Loan Party of this Agreement or any other Loan Document. 

        5.04    Binding Effect.    This Agreement has been, and each other
Loan Document, when delivered hereunder, will have been, duly executed and delivered by each Loan Party that is party thereto. This Agreement constitutes, and each other Loan Document when so
delivered will constitute, a legal, valid and binding obligation of such Loan Party, enforceable against each Loan Party that is party thereto in accordance with its terms. 

        5.05    Financial Statements; No Material Adverse Effect.    (a) The
Audited Financial Statements (i) were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein; and
(ii) fairly present the financial condition of Borrowers and their Subsidiaries as of the date thereof and their results of operations for the period covered thereby in accordance with GAAP
consistently applied throughout the period covered thereby, except as otherwise expressly noted therein. 

        (b)   The
unaudited consolidated and consolidating balance sheets of Borrowers and their Subsidiaries dated September 30, 2007 and the related consolidated and
consolidating statements of 

50

 

income
or operations, shareholders' equity and cash flows for the fiscal quarter ended on that date (i) were prepared in accordance with GAAP consistently applied throughout the period covered
thereby, except as otherwise expressly noted therein, and (ii) fairly present the financial condition of Borrowers and their Subsidiaries as of the date thereof and their results of operations
for the period covered thereby, subject, in the case of clauses (i) and (ii), to the absence of footnotes and to normal year-end audit adjustments. 

        (c)   Since
the date of the Audited Financial Statements, there has been no event or circumstance, either individually or in the aggregate, that has had or could reasonably be
expected to have a Material Adverse Effect. 

        (d)   The
consolidated and consolidating forecasted balance sheet and statements of income and cash flows of Borrowers and their Subsidiaries delivered pursuant to  Section 6.01(b) were prepared in good faith
on the basis of the assumptions stated therein, which assumptions were fair in light of the
conditions existing at the time of delivery of such forecasts, and represented, at the time of delivery, Borrowers' best estimate of its future financial condition and performance. 

        5.06    Litigation.    There are no actions, suits, proceedings,
claims or disputes pending or, to the knowledge of Borrowers after due and diligent investigation, threatened or contemplated, at law, in equity, in arbitration or before any Governmental Authority,
by or against Borrowers or any of their Subsidiaries or against any of their properties or revenues that (a) purport to affect or pertain to this Agreement or any other Loan Document, or any of
the transactions contemplated hereby, or (b) except as specifically disclosed in Schedule 5.06, either individually or in the aggregate,
if determined adversely, could reasonably be expected to have a Material Adverse Effect, and there has been no adverse change in the status, or financial effect on any Loan Party or any Subsidiary
thereof, of the matters described on Schedule 5.06. 

        5.07    No Default.    Neither any Loan Party nor any Subsidiary
thereof is in default under or with respect to any Contractual Obligation that could, either individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect. No Default has occurred and is continuing or would result from the consummation of the transactions contemplated by this Agreement or any other Loan Document. 

        5.08    Ownership of Property; Liens.    Each Borrower and each
Subsidiary has good record and marketable title in fee simple to, or valid leasehold interests in, all real property necessary or used in the ordinary conduct of its business, except for such defects
in title as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The property of Borrowers and their Subsidiaries is subject to no Liens, other than
Liens permitted by Section 7.01. 

        5.09    Environmental Compliance.    Except as specifically disclosed
in Schedule 5.09, there are, to Borrowers' knowledge, no claims alleging potential liability or responsibility for the violation of any
Environmental Law on Borrowers' businesses, operations and properties which could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. 

        5.10    Insurance.    The properties of Borrowers and their
Subsidiaries are insured with financially sound and reputable insurance companies not Affiliates of Borrowers, in such amounts (after giving effect to any self-insurance compatible with
the following standards), with such deductibles and covering such risks as are customarily carried by companies engaged in similar businesses and owning similar properties in localities where a
Borrower or the applicable Subsidiary operates. 

        5.11    Taxes.    Borrowers and their Subsidiaries have filed all
Federal, state and other material tax returns and reports required to be filed, and have paid all Federal, state and other material taxes, assessments, fees and other governmental charges levied or
imposed upon them or their properties, income or assets otherwise due and payable, except those which are being contested in good faith by appropriate proceedings diligently conducted and for which
adequate reserves have been provided in 

51

 

accordance
with GAAP. There is no proposed tax assessment against any Borrower or any Subsidiary that would, if made, have a Material Adverse Effect. 

        5.12    ERISA Compliance.    (a) Each Plan is in compliance in all
material respects with the applicable provisions of ERISA, the Code and other Federal or state Laws. Each Plan that is intended to qualify under Section 401(a) of the Code has received a
favorable determination letter from the IRS or an application for such a letter is currently being processed by the IRS with respect thereto and, to the best knowledge of Borrowers, nothing has
occurred which would prevent, or cause the loss of, such qualification. Borrowers and each ERISA Affiliate have made all required contributions to each Plan subject to Section 412 of the Code,
and no application for a funding waiver or an extension of any amortization period pursuant to Section 412 of the Code has been made with respect to any Plan. 

        (b)   There
are no pending or, to the best knowledge of Borrowers, threatened claims, actions or lawsuits, or action by any Governmental Authority, with respect to any Plan
that could be reasonably be expected to have a Material Adverse Effect. There has been no prohibited transaction or violation of the fiduciary responsibility rules with respect to any Plan that has
resulted or could reasonably be expected to result in a Material Adverse Effect. 

        (c)   (i)
No ERISA Event has occurred or is reasonably expected to occur; (ii) no Pension Plan has any Unfunded Pension Liability; (iii) neither Borrowers nor
any ERISA Affiliate has incurred, or reasonably expects to incur, any liability under Title IV of ERISA with respect to any Pension Plan (other than premiums due and not delinquent under
Section 4007 of ERISA); (iv) neither Borrowers nor any ERISA Affiliate has incurred, or reasonably expects to incur, any liability (and no event has occurred which, with the giving of
notice under Section 4219 of ERISA, would result in such liability) under Section 4201 or 4243 of ERISA with respect to a Multiemployer Plan; and (v) neither Borrowers nor any
ERISA Affiliate has engaged in a transaction that could be subject to Section 4069 or 4212(c) of ERISA. 

        5.13    Subsidiaries.    As of the Closing Date, no Borrower has any
Subsidiaries other than those specifically disclosed in Part (a) of Schedule 5.13, and all of the outstanding Equity Interests in such
Subsidiaries have been validly issued, are fully paid and nonassessable and are owned by a Loan Party in the amounts specified on Part (a) of  Schedule 5.13 free and clear of all Liens. No
Borrower has equity investments in any other corporation or entity other than those specifically
disclosed in Part(b) of Schedule 5.13. All of the outstanding Equity Interests in each Borrower have been validly issued and are fully paid and
nonassessable. 

        5.14    Margin Regulations; Investment Company Act.    (a) No Borrower
is engaged or will engage, principally or as one of its important activities, in the business of purchasing or carrying margin stock (within the meaning of Regulation U issued by the FRB), or
extending credit for the purpose of purchasing or carrying margin stock. Following the application of the proceeds of each Borrowing or drawing under each Letter of Credit, not more than 25% of the
value of the assets (either of a Borrower only or of a Borrower and its Subsidiaries on a consolidated basis) subject to the provisions of  Section 7.01 or Section 7.05 or subject to any restriction contained in any agreement or
instrument between Borrowers and any Lender or any Affiliate of any Lender relating to Indebtedness and within the scope of Section 8.01(e) will
be margin stock. 

        (b)   No
Borrower, Person Controlling Borrower, or Subsidiary is, or is required to be registered as, an "investment company" under the Investment Company Act of 1940. 

        5.15    Disclosure.    Borrowers have disclosed to Agent and Lenders
all agreements, instruments and corporate or other restrictions to which it or any of its Subsidiaries is subject, and all other matters known to it, that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect. No report, financial statement, certificate or other information furnished (whether in writing or orally) by or on behalf of any Loan
Party to Agent or any Lender in connection with the 

52

 

transactions
contemplated hereby and the negotiation of this Agreement or delivered hereunder or under any other Loan Document (in each case, as modified or supplemented by other information so
furnished) contains any material misstatement of fact or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not
misleading; provided that, with respect to projected financial information, Borrowers represent only that such information was prepared in good faith
based upon assumptions believed to be reasonable at the time. 

        5.16    Compliance with Laws.    Each Loan Party and each Subsidiary
thereof is in compliance in all material respects with the requirements of all Laws and all orders, writs, injunctions and decrees applicable to it or to its properties, except in such instances in
which (a) such requirement of Law or order, writ, injunction or decree is being contested in good faith by appropriate proceedings diligently conducted or (b) the failure to comply
therewith, either individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect. 

        5.17    Taxpayer Identification Number.    Borrowers' true and correct
U.S. taxpayer identification numbers are set forth on Schedule 10.02. 

        5.18    Intellectual Property; Licenses, Etc.    Borrowers and their
Subsidiaries own, or possess the right to use, all of the trademarks, service marks, trade names, copyrights, patents, patent rights, franchises, licenses and other intellectual property rights that
are reasonably necessary for the operation of their respective businesses and, to Borrowers' knowledge, without conflict with the rights of any other Person. To the best knowledge of Borrowers, no
slogan or other advertising device, product, process, method, substance, part or other material now employed, or now contemplated to be employed, by Borrowers or any Subsidiary infringes upon any
rights held by any other Person. No claim or litigation regarding any of the foregoing is pending or, to the best knowledge of Borrowers, threatened, which, either individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect. 

        5.19    Rights in Collateral; Priority of Liens.    Borrowers and each
other Loan Party own the property granted by it as Collateral under the Collateral Documents, free and clear of any and all Liens in favor of third parties. Upon the proper filing of UCC financing
statements, and the taking of the other actions required by the Required Lenders, the Liens granted pursuant to the Collateral Documents will constitute valid and enforceable first, prior and
perfected Liens on the Collateral in favor of Agent, for the ratable benefit of Agent and Lenders. 

 
 

ARTICLE VI. AFFIRMATIVE COVENANTS    
    

        So long as any Lender shall have any Commitment hereunder, any Loan or other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding, Borrowers shall, and shall (except in the case of the covenants set forth in Sections 6.01,  6.02 and 6.03) cause each Subsidiary to: 

        6.01    Financial Statements.    Deliver to Agent a sufficient number
of copies for delivery by Agent to each Lender, in form and detail satisfactory to Agent and the Required Lenders: 

        (a)   Within
one hundred twenty (120) days of the end of each fiscal year of SI Holdings, audited balance sheets and statements of profit and loss and cash flows,
retained earnings, reconciliation of net worth and source and application of funds for such fiscal year for SI Holdings, each prepared in accordance with GAAP consistently applied, on a consolidated
and consolidating basis, in reasonable detail by independent certified public accountants selected by the Borrowers and acceptable to the Agent, showing SI Holdings' consolidated and consolidating
financial condition at the close of such fiscal year and the results of operations during such year, together with a certificate signed by an officer of the Borrowers, certifying Borrowers'
compliance, or lack thereof, with the financial covenants 

53

 

described
in Section 6.12 hereof, and a schedule showing the calculations used to determine such compliance (or lack thereof). 

        (b)   Within
sixty (60) days after the end of each quarter in each fiscal year of SI Holdings, consolidated balance sheets and statements of profit and loss and cash
flows, retained earnings, reconciliation of net worth and source and application of funds for such fiscal year, each prepared in reasonable detail in accordance with GAAP, on a consolidated and
consolidating basis, consistently applied, and consistent in format with the financial statements furnished to Agent in connection with the Borrowers' loan application, certified by the President or
Chief Financial Officer of SI Holdings as fairly representing the financial position of the Borrowers, such balance sheets to be as of the close of such quarter and such other statements to be for the
period from the beginning of the then current fiscal year to the end of such quarter in each case subject to normal audit and year-end adjustments. 

        (c)   Within
sixty (60) days after the end of each quarter in each fiscal year, an aged analysis of all outstanding Receivables and Receivables reconciliation and
ineligible reserves reports, an inventory certificate detailing locations of inventory and lower of cost or market value thereof, and an accounts payable aging, all in form and substance satisfactory
to the Agent. 

        (d)   Within
thirty (30) days after the beginning of each fiscal year, a management prepared budget for the then fiscal year in form and substance reasonably
satisfactory to the Agent, prepared on a consolidated and consolidating basis, which budget shall include, without limitation, projected covenant compliance, projected profit and loss and cash flow
statements, balance sheets and a capital expenditure budget. 

        (e)   Notwithstanding
anything set forth in this Section 6.01 to the contrary, at any time the Aggregate Commitments are
being calculated using the Overadvance Amount (i.e., the Funded Debt to EBITDA Ratio exceeds 3.25:1.00), Borrowers shall deliver to Agent the financial reports required by  Sections 6.01(b) and
(c), together with a Borrowing Base Certificate within thirty
(30) days after the end of each calendar month. 

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        6.02    Certificates; Other Information.    Deliver to Agent a
sufficient number of copies for delivery by Agent to each Lender, in form and detail satisfactory to Agent and the Required Lenders: 

        (a)   concurrently
with the delivery of the financial statements referred to in Section 6.01(a) and  (b), a duly completed Compliance Certificate signed by the chief
executive officer, chief financial officer, treasurer or controller of Borrowers; 

        (b)   promptly
after any request by Agent or any Lender, copies of any detailed audit reports or management letters submitted to the board of directors (or the audit committee
of the board of directors) of Borrowers by independent accountants in connection with the accounts or books of Borrowers or any Subsidiary, or any audit of any of them; 

        (c)   promptly
after the same are available, copies of each annual report, proxy or financial statement or other report or communication sent to the stockholders of Borrowers,
and copies of all annual, regular, periodic and special reports and registration statements which Borrowers may file or be required to file with the Securities and Exchange Commission under
Section 13 or 15(d) of the Securities Exchange Act of 1934, and not otherwise required to be delivered to Agent pursuant hereto; 

        (d)   promptly
after the furnishing thereof, copies of any statement or report furnished to any holder of debt securities of any Loan Party or any Subsidiary thereof pursuant
to the terms of any indenture, loan or credit or similar agreement and not otherwise required to be furnished to the Lenders pursuant to  Section 6.01 or any other clause of this Section 6.02; 

        (e)   promptly,
and in any event within five (5) Business Days after receipt thereof by any Loan Party or any Subsidiary thereof, copies of each notice or other
correspondence received from the Securities and Exchange Commission (or comparable agency in any applicable non-U.S. jurisdiction) concerning any investigation or possible investigation or
other inquiry by such agency regarding financial or other operational results of any Loan Party or any Subsidiary thereof; 

        (f)    promptly,
such additional information regarding the business, financial or corporate affairs of Borrowers or any Subsidiary, or compliance with the terms of the Loan
Documents, as Agent or any Lender may from time to time reasonably request; and 

        (g)   at
the request of Agent, Borrowers shall provide Agent with a field exam prepared by a third party reasonably acceptable to Agent, which shall be paid for by Borrowers
once in each calendar year unless an Event of Default has occurred. 

Documents
required to be delivered pursuant to Section 6.01(a), (b) or  (c) or Section 6.02(d) (to the extent any such documents are included in materials otherwise
filed with the SEC) to the extent any such documents are not otherwise publicly available to the Agent or Lenders or at a Lenders' request therefor, may be delivered electronically and if so
delivered, shall be deemed to have been delivered on 

55

 

the
date (i) on which Borrowers post such documents, or provide a link thereto on Borrowers' website on the Internet at the website address listed on  Schedule 10.02; or (ii) on which such
documents are posted on Borrowers' behalf on an Internet or intranet website, if any, to which each
Lender and Agent have access (whether a commercial, third-party website or whether sponsored by Agent); provided that: (i) Borrowers shall deliver paper copies of such documents to Agent or any
Lender that requests Borrowers to deliver such paper copies until a written request to cease delivering paper copies is given by Agent or such Lender and (ii) Borrowers shall notify Agent and
each Lender (by telecopier or electronic mail) of the posting of any such documents and provide to Agent by electronic mail electronic versions (i.e., soft copies) of such documents. Agent
shall have no obligation to request the delivery or to maintain copies of the documents referred to above, and in any event shall have no responsibility to monitor compliance by Borrowers with any
such request for delivery, and each Lender shall be solely responsible for requesting delivery to it or maintaining its copies of such documents. 

Borrowers
hereby acknowledge that (a) Agent will make available to Lenders and the L/C Issuer materials and/or information provided by or on behalf of Borrowers hereunder (collectively,
"Borrower Materials") by posting Borrower Materials on IntraLinks or another similar electronic system (the
"Platform") and (b) certain of the Lenders (each, a "Public Lender") may have personnel who do
not wish to receive material non-public information with respect to Borrowers or their Affiliates or the respective securities of any of the foregoing, and who may be engaged in investment
and other market-related activities with respect to such Persons' securities. Borrowers hereby agree that so long as a Borrower is the issuer of any outstanding debt or equity securities that are
registered or issued pursuant to a private offering or is actively contemplating issuing any such securities (w) all Borrower Materials that are to be made available to Public Lenders shall be
clearly and conspicuously marked "PUBLIC" which, at a minimum, shall mean that the word "PUBLIC" shall appear prominently on the first page thereof; (x) by marking Borrower Materials "PUBLIC,"
Borrowers shall be deemed to have authorized Agent, the L/C Issuer and the Lenders to treat such Borrower Materials as not containing any material non-public information with respect to
Borrowers or its securities for purposes of United States Federal and state securities laws (provided, however, that to the extent such Borrower Materials constitute Information, they shall be treated
as set forth in Section 10.07); (y) all Borrower Materials marked "PUBLIC" are permitted to be made available through a portion of the
Platform designated "Public Investor;" and (z) Agent shall be entitled to treat
any Borrower Materials that are not marked "PUBLIC" as being suitable only for posting on a portion of the Platform not designated "Public Investor." 

        6.03    Notices.    Promptly notify Agent and each Lender: 

        (a)   of
the occurrence of any Default; 

        (b)   of
any matter that has resulted or could reasonably be expected to result in a Material Adverse Effect, including (i) breach or non-performance of, or
any default under, a Contractual Obligation of Borrowers or any Subsidiary; (ii) any dispute, litigation, investigation, proceeding or suspension between Borrowers or any Subsidiary and any
Governmental Authority; or (iii) the commencement of, or any material development in, any litigation or proceeding affecting Borrowers or any Subsidiary, including pursuant to any applicable
Environmental Laws; 

        (c)   of
the occurrence of any ERISA Event; and 

        (d)   of
any material change in accounting policies or financial reporting practices by Borrowers or any Subsidiary including any determination by Borrowers referred to in  Section 2.10 (b). 

Each
notice pursuant to this Section shall be accompanied by a statement of a Responsible Officer of Borrowers setting forth details of the occurrence referred to therein and stating what action
Borrowers has taken and proposes to take with respect thereto. Each notice pursuant to Section 6.03(a) shall describe with particularity any and
all provisions of this Agreement and any other Loan Document that have been breached. 

56

 

        6.04    Payment of Obligations.    Pay and discharge as the same shall
become due and payable, all its obligations and liabilities, including (a) all tax liabilities, assessments and governmental charges or levies upon it or its properties or assets, unless the
same are being contested in good faith by appropriate proceedings diligently conducted and adequate reserves in accordance with GAAP are being maintained by Borrowers or such Subsidiary;
(b) all lawful claims which, if unpaid, would by law become a Lien upon its property; and (c) all Indebtedness, as and when due and payable, but subject to any subordination provisions
contained in any instrument or agreement evidencing such Indebtedness. 

        6.05    Preservation of Existence, Etc.    (a) Preserve, renew and
maintain in full force and effect its legal existence and good standing under the Laws of the jurisdiction of its organization except in a transaction permitted by  Section 7.04 or 7.05; (b) take all reasonable action to maintain all rights, privileges,
permits, licenses and franchises necessary or desirable in the normal conduct of its business, except to the extent that failure to do so could not reasonably be expected to have a Material Adverse
Effect; and (c) preserve or renew all of its registered patents, trademarks, trade names and service marks, the non-preservation of which could reasonably be expected to have a
Material Adverse Effect. 

        6.06    Maintenance of Properties.    (a) Maintain, preserve and
protect all of its material properties and equipment necessary in the operation of its business in good working order and condition, ordinary wear and tear excepted; (b) make all necessary
repairs thereto and renewals and replacements thereof except where the failure to do so could not reasonably be expected to have a Material Adverse Effect; and (c) use the standard of care
typical in the industry in the operation and maintenance of its facilities. 

        6.07    Maintenance of Insurance.    Maintain with financially sound
and reputable insurance companies not Affiliates of Borrowers, insurance with respect to its properties and business against loss or damage of the kinds customarily insured against by Persons engaged
in the same or similar business, of such types and in such amounts (after giving effect to any self-insurance compatible with the following standards) as are customarily carried under
similar circumstances by such other Persons and providing for not less than 30 days' prior notice to Agent of termination, lapse or cancellation of such insurance. 

        6.08    Compliance with Laws.    Comply in all material respects with
the requirements of all Laws and all orders, writs, injunctions and decrees applicable to it or to its business or property, except in such instances in which (a) such requirement of Law or
order, write, injunction or decree is being contested in good faith by appropriate proceedings diligently conducted; or (b) the failure to comply therewith could not reasonably be expected to
have a Material Adverse Effect. 

        6.09    Books and Records.    (a) Maintain proper books of record and
account, in which full, true and correct entries in conformity with GAAP consistently applied shall be made of all financial transactions and matters involving the assets and business of Borrowers or
such Subsidiary, as the case may be; and (b) maintain such books of record and account in material conformity with all applicable requirements of any Governmental Authority having regulatory
jurisdiction over Borrowers or such Subsidiary, as the case may be. Borrowers shall maintain at all times books and records pertaining to the Collateral in such detail, form and scope as Agent or any
Lender shall reasonably require. 

        6.10    Inspection Rights.    Permit representatives and independent
contractors of Agent and each Lender to visit and inspect any of its properties, to examine its corporate, financial and operating records, and make copies thereof or abstracts therefrom, and to
discuss its affairs, finances and accounts with its directors, officers, and independent public accountants, all at the expense of Borrowers and at such reasonable times during normal business hours
and as often as may be reasonably desired, upon reasonable advance notice to Borrowers; provided,  however, that when an Event of Default exists Agent
or any Lender (or any of their respective representatives or independent contractors) may do any of the foregoing at the expense of Borrowers at any time during normal business hours and without
advance notice. 

57

 

        6.11    Use of Proceeds.    Use the proceeds of the Credit Extensions
for general corporate purposes (including, without limitation, the Kiddopotamus Merger) not in contravention of any Law or of any Loan Document. 

        6.12    Financial Covenants.    

        (a)    Net Worth.    Maintain on a consolidated basis Net Worth equal to at least the sum of the following:
(i) Fifty Million and no/100 Dollars ($50,000,000); plus (ii) the sum of fifty percent (50%) of net income after income taxes (without subtracting losses) earned in each fiscal year
ending after the date of this Agreement. 

        (b)    Funded Debt to EBITDA Ratio.    Maintain on a consolidated basis a ratio of Funded Debt to EBITDA not exceeding
3.50:1.00. This ratio will be calculated at the end of each reporting period for which this Agreement requires Borrowers to deliver financial statements, using the results of the twelve-month period
ending with that reporting period. 

        (c)    Basic Fixed Charge Coverage Ratio.    Maintain on a consolidated basis a Basic Fixed Charge Coverage Ratio of
at least 1.25:1.00. This ratio will be calculated at the end of each reporting period for which this Agreement requires Borrowers to deliver financial statements, using the results of the twelve-
month period ending with that reporting period. The current portion of long-term liabilities will be measured as of the date twelve (12) months prior to the current financial
statement. 

        6.13    Guarantors.    Notify Agent at the time that any Person
becomes a Subsidiary, and promptly thereafter (and in any event within 30 days), cause such Person to (a) become a Guarantor by executing and delivering to Agent a Guaranty or such other
document as Agent shall deem appropriate for such purpose, and (b) deliver to Agent documents of the types referred to in clauses (iii) and (iv) of  Section 4.01(a) and favorable
opinions of counsel to such Person (which shall cover, among other things, the legality, validity, binding effect
and enforceability of the documentation referred to in clause (a)), all in form, content and scope reasonably satisfactory to Agent. 

        6.14    Collateral Records.    To execute and deliver promptly, and to
cause each other Loan Party to execute and deliver promptly, to Agent, from time to time, solely for Agent's convenience in maintaining a record of the Collateral, such written statements and
schedules as Agent may reasonably require designating, identifying or describing the Collateral. The failure by Borrowers or any other Loan Party, however, to promptly give Agent such statements or
schedules shall not affect, diminish, modify or otherwise limit the Liens on the Collateral granted pursuant to the Collateral Documents. 

        6.15    Security Interests.    To, and to cause each other Loan Party
to, (a) defend the Collateral against all claims and demands of all Persons at any time claiming the same or any interest therein, (b) comply with the requirements of all state and
federal laws in order to grant to Agent and Lenders valid and perfected first priority security interests in the Collateral, with perfection, in the case of any investment property, deposit account or
letter of credit, being effected by giving Agent control of such investment property or deposit account or letter of credit, rather than by the filing of a financing statement with respect to such
investment property, and (c) do whatever Agent may reasonably request, from time to time, to effect the purposes of this Agreement and the other Loan Documents, including filing notices of
liens, UCC financing statements, fixture filings and amendments, renewals and continuations thereof; cooperating with Agent's representatives; keeping stock records; obtaining waivers from landlords
and mortgagees and from warehousemen and their landlords and mortgages; and, paying claims which might, if unpaid, become a Lien on the Collateral. Agent is hereby authorized by Borrowers to file any
UCC financing statements covering the Collateral whether or not Borrowers' signatures appear thereon. 

        6.16    Maintenance of Swap Contract.    Borrowers shall at all times
maintain the Swap Contract required pursuant to Section 4.01(f). 

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ARTICLE VII. NEGATIVE COVENANTS  

So
long as any Lender shall have any Commitment hereunder, any Loan or other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of Credit shall remain outstanding, Borrowers shall
not, nor shall it permit any Subsidiary to, directly or indirectly: 

        7.01    Liens.    Create, incur, assume or suffer to exist any Lien
upon any of its property, assets or revenues, whether now owned or hereafter acquired, other than the following: 

        (a)   Liens
pursuant to any Loan Document; 

        (b)   Liens
existing on the date hereof and listed on Schedule 7.01 and any renewals or extensions thereof,  provided that (i) the property covered thereby is
not changed, (ii) the amount secured or benefited thereby is not increased except as
contemplated by Section 7.03(b), (iii) the direct or any contingent obligor with respect thereto is not changed, and (iv) and any
renewal or extension of the obligations secured or benefited thereby is permitted by Section 7.03(b); 

        (c)   Liens
for taxes not yet due or which are being contested in good faith and by appropriate proceedings diligently conducted, if adequate reserves with respect thereto are
maintained on the books of the applicable Person in accordance with GAAP; 

        (d)   carriers',
warehousemen's, mechanics', materialmen's, repairmen's or other like Liens arising in the ordinary course of business which are not overdue for a period of
more than 30 days or which are being contested in good faith and by appropriate proceedings diligently conducted, if adequate reserves with respect thereto are maintained on the books of the
applicable Person; 

        (e)   pledges
or deposits in the ordinary course of business in connection with workers' compensation, unemployment insurance and other social security legislation, other than
any Lien imposed by ERISA; 

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

        (g)   easements,
rights-of-way, restrictions and other similar encumbrances affecting real property which, in the aggregate, are not substantial in
amount, and which do not in any case materially detract from the value of the property subject thereto or materially interfere with the ordinary conduct of the business of the applicable Person; 

        (h)   Liens
securing judgments for the payment of money not constituting an Event of Default under Section 8.01(h); and 

        (i)    Liens
securing Indebtedness permitted under Section 7.03(e);  provided that (i) such Liens do not at any time encumber any property other than the
property financed by such Indebtedness and (ii) the
Indebtedness secured thereby does not exceed the cost or fair market value, whichever is lower, of the property being acquired on the date of acquisition. 

        7.02    Investments.    Make any Investments, except: 

        (a)   Investments
held by Borrowers or such Subsidiary in the form of cash equivalents or short-term marketable debt securities; 

        (b)   advances
to officers, directors and employees of Borrowers and Subsidiaries in an aggregate amount not to exceed $250,000 at any time outstanding, for travel,
entertainment, relocation and analogous ordinary business purposes; 

        (c)   Investments
of Borrowers in any wholly-owned Subsidiary and Investments of any wholly-owned Subsidiary in Borrowers or in another wholly-owned Subsidiary; 

        (d)   Investments
consisting of extensions of credit in the nature of accounts receivable or notes receivable arising from the grant of trade credit in the ordinary course of
business, and Investments 

59

 

received
in satisfaction or partial satisfaction thereof from financially troubled account debtors to the extent reasonably necessary in order to prevent or limit loss; and 

        (e)   Guarantees
permitted by Section 7.03.

        7.03    Indebtedness.    Create, incur, assume or suffer to exist any
Indebtedness, except: 

        (a)   Indebtedness
under the Loan Documents; 

        (b)   Indebtedness
outstanding on the date hereof and listed on Schedule 7.03 and any refinancings, refundings, renewals
or extensions thereof; provided that (i) the amount of such Indebtedness is not increased at the time of such refinancing, refunding, renewal or
extension except by an amount equal to a reasonable premium or other reasonable amount paid, and fees and expenses reasonably incurred, in connection with such refinancing and by an amount equal to
any existing commitments unutilized thereunder and (ii) the terms relating to principal amount, amortization, maturity, collateral (if any) and subordination (if any), and other material terms
taken as a whole, of any such refinancing, refunding, renewing or extending Indebtedness, and of any agreement entered into and of any instrument issued in connection therewith, are no less favorable
in any material respect to the Loan Parties or Lenders than the terms of any agreement or instrument governing the Indebtedness being refinanced, refunded, renewed or extended and the interest rate
applicable to any such refinancing, refunding, renewing or extending Indebtedness does not exceed the then applicable market interest rate; 

        (c)   Guarantees
of Borrowers or any Subsidiary in respect of Indebtedness otherwise permitted hereunder of Borrowers or any wholly-owned Subsidiary; 

        (d)   obligations
(contingent or otherwise) of Borrowers or any Subsidiary existing or arising under any Swap Contract,  provided that (i) such obligations are (or were) entered into by such Person in the ordinary
course of business for the purpose of directly
mitigating risks associated with liabilities, commitments, investments, assets, or property held or reasonably anticipated by such Person, or changes in the value of securities issued by such Person,
and not for purposes of speculation or taking a "market view;" and (ii) such Swap Contract does not contain any provision exonerating the non-defaulting party from its obligation to
make payments on outstanding transactions to the defaulting party; 

        (e)   Indebtedness
in respect of capital leases, Synthetic Lease Obligations and purchase money obligations for fixed or capital assets within the limitations set forth in  Section 7.01(i); provided, however, that the
aggregate amount of all such Indebtedness at any one time outstanding shall not exceed $500,000; and 

        (f)    Indebtedness
pursuant to the Basic Comfort Seller Earn Out, provided,  however, that if a Default or Event of Default exists at the time the Basic Comfort Earn Out
becomes due, SI USA shall exercise its option under the
Basic Comfort Purchase Agreement to pay fifty percent (50%) of the Basic Comfort Earn Out using common stock in SI Holdings. 

        7.04    Fundamental Changes.    Merge, dissolve, liquidate,
consolidate with or into another Person, or Dispose of (whether in one transaction or in a series of transactions) all or substantially all of its assets (whether now owned or hereafter acquired) to
or in favor of any Person, except that, so long as no Default exists or would result therefrom: 

        (a)   any
Subsidiary may merge with (i) a Borrower, provided that such Borrower shall be the continuing or surviving
Person, or (ii) any one or more other Subsidiaries, provided that when any wholly-owned Subsidiary is merging with another Subsidiary, the
wholly-owned Subsidiary shall be the continuing or surviving Person, and, provided further that if a Guarantor is merging with another Subsidiary, the
Guarantor shall be the surviving Person; and 

        (b)   any
Subsidiary may Dispose of all or substantially all of its assets (upon voluntary liquidation or otherwise) to a Borrower or to another Subsidiary;  provided that if the transferor in such a 

60

 

transaction
is a wholly-owned Subsidiary, then the transferee must either be a Borrower or a wholly-owned Subsidiary and, provided further that if the transferor of such assets is a Guarantor, the
transferee must either be a Borrower or a Guarantor. 

        7.05    Dispositions.    Make any Disposition or enter into any
agreement to make any Disposition, except: 

        (a)   Dispositions
of obsolete or worn out property, whether now owned or hereafter acquired, in the ordinary course of business; 

        (b)   Dispositions
of inventory in the ordinary course of business; 

        (c)   Dispositions
of equipment or real property to the extent that (i) such property is exchanged for credit against the purchase price of similar replacement property
or (ii) the proceeds of such Disposition are reasonably promptly applied to the purchase price of such replacement property; 

        (d)   Dispositions
of property by any Subsidiary to a Borrower or to a wholly-owned Subsidiary; provided that if the transferor
of such property is a Guarantor, the transferee thereof must either be a Borrower or a Guarantor; and 

        (e)   Dispositions
permitted by Section 7.04. 

provided, however, that any Disposition pursuant to clauses (a) through (e) shall be for
fair market value. 

        7.06    Restricted Payments.    Declare or make, directly or
indirectly, any Restricted Payment, or incur any obligation (contingent or otherwise) to do so, or issue or sell any Equity Interests, except that, so long as no Default shall have occurred and be
continuing at the time of any action described below or would result therefrom: 

        (a)   each
Subsidiary may make Restricted Payments to Borrowers, Guarantors and any other Person that owns an Equity Interest in such Subsidiary, ratably according to their
respective holdings of the type of Equity Interest in respect of which such Restricted Payment is being made; 

        (b)   Borrowers
and each Subsidiary may declare and make dividend payments or other distributions payable solely in the common stock or other common Equity Interests of such
Person; and 

        (c)   Borrowers
and each Subsidiary may purchase, redeem or otherwise acquire Equity Interests issued by it with the proceeds received from the substantially concurrent issue
of new shares of its common stock or other common Equity Interests. 

        7.07    Change in Nature of Business.    Engage in any material line
of business substantially different from those lines of business conducted by Borrowers and their Subsidiaries on the date hereof or any business substantially related or incidental thereto. 

        7.08    Transactions with Affiliates.    Without the prior written
consent of Agent, which shall not be unreasonably withheld, conditioned, or delayed, enter into any transaction of any kind with any Affiliate of a Borrower, which is not in the ordinary course of
business, other than on fair and reasonable terms substantially as favorable to such Borrower or such Subsidiary as would be obtainable by such Borrower or such Subsidiary at the time in a comparable
arm's length transaction with a Person other than an Affiliate, provided that the foregoing restriction shall not apply to transactions between or among any Borrower and any Guarantor or between and
among Guarantors. 

        7.09    Burdensome Agreements.    Enter into any Contractual
Obligation (other than this Agreement or any other Loan Document) that (a) limits the ability (i) of any Subsidiary to make Restricted Payments to a Borrower or to otherwise transfer
property to a Borrower, (ii) of any Subsidiary to Guarantee the Indebtedness of a Borrower or (iii) of a Borrower or any Subsidiary to create, incur, assume or suffer to exist Liens on
property of such Person; provided, however, that this clause (iii) shall not prohibit any
negative pledge incurred or provided in favor of any holder of Indebtedness permitted under Section 7.03(e) solely to the extent any such
negative pledge relates to 

61

 

the
property financed by or the subject of such Indebtedness; or (b) requires the grant of a Lien to secure an obligation of such Person if a Lien is granted to secure another obligation of
such Person. 

        7.10    Use of Proceeds.    Use the proceeds of any Credit Extension,
whether directly or indirectly, and whether immediately, incidentally or ultimately, to purchase or carry margin stock (within the meaning of Regulation U of the FRB) or to extend credit to
others for the purpose of purchasing or carrying margin stock or to refund indebtedness originally incurred for such purpose. 

ARTICLE VIII. EVENTS OF DEFAULT AND REMEDIES  

        8.01    Events of Default.    Any of the following shall constitute an
Event of Default: 

        (a)   Non-Payment.    Any Borrower or any other Loan Party fails to pay (i) within three business
days after the same becomes due, any amount of principal of any Loan or any L/C Obligation, or any interest on any Loan or on any L/C Obligation, or any fee due hereunder, or (ii) within five
business days after the same becomes due, any other amount payable hereunder or under any other Loan Document; or 

        (b)   Specific Covenants.    Borrowers fail to perform or observe any term, covenant or agreement contained in any of  Section 6.01, 6.02, 6.03,
6.05, 6.10, 6.11, 6.12 or  6.13 or Article VII; or 

        (c)   Other Defaults.    Any Loan Party fails to perform or observe any other covenant or agreement (not specified in
subsection (a) or (b) above) contained in any Loan Document on its part to be performed or observed and such failure continues for 30 days or any default or Event of Default
occurs under any other Loan Document; or 

        (d)   Representations and Warranties.    Any material representation, warranty, certification or statement of fact
made or deemed made by or on behalf of Borrowers or any other Loan Party herein, in any other Loan Document, or in any document delivered in connection herewith or therewith shall be incorrect or
misleading in any material respect when made or deemed made; or 

        (e)   Cross-Default.    (i) Any Borrower or any Subsidiary (A) fails to make any payment when due (whether by
scheduled maturity, required prepayment, acceleration, demand, or otherwise) in respect of any Indebtedness or Guarantee (other than Indebtedness hereunder and Indebtedness under Swap Contracts)
having an aggregate principal amount (including undrawn committed or available amounts and including amounts owing to all creditors under any combined or syndicated credit arrangement) of more than
the Threshold Amount and such failure is not being diligently contested in good faith by such Borrower or Subsidiary, or (B) fails to observe or perform any other agreement or condition
relating to any such Indebtedness or Guarantee or contained in any instrument or agreement evidencing, securing or relating thereto, or any other event occurs, the effect of which default or other
event is to cause, or to permit the holder or holders of such Indebtedness or the beneficiary or beneficiaries of such Guarantee (or a trustee or agent on behalf of such holder or holders or
beneficiary or beneficiaries) to cause, with the giving of notice if required, such Indebtedness to be demanded or to become due or to be repurchased, prepaid, defeased or redeemed (automatically or
otherwise), or an offer to repurchase, prepay, defease or redeem such Indebtedness to be made, prior to its stated maturity, or such Guarantee to become payable or cash collateral in respect thereof
to be demanded; (ii) there occurs an Event of Default under the Real Estate Loan Documents; or (iii) there occurs under any Swap Contract an Early Termination Date (as defined in such
Swap Contract) resulting from (A) any event of default under such Swap Contract as to which Borrowers or any Subsidiary is the Defaulting Party (as defined in such Swap Contract) or
(B) any Termination Event (as so defined) under such Swap Contract as to which Borrowers or any Subsidiary is an Affected Party (as so defined) and, in either event, the Swap Termination Value
owed by Borrowers or such Subsidiary as a result thereof is greater than the Threshold Amount; or 

        (f)    Insolvency Proceedings, Etc.    Any Loan Party or any of its Subsidiaries institutes or consents to the
institution of any proceeding under any Debtor Relief Law, or makes an assignment for the 

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benefit
of creditors; or applies for or consents to the appointment of any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer for it or for all or any material
part of its property; or any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer is appointed without the application or consent of such Person and the appointment
continues undischarged or unstayed for 60 calendar days; or any proceeding under any Debtor Relief Law relating to any such Person or to all or any material part of its property is instituted without
the consent of such Person and continues undismissed or unstayed for 60 calendar days, or an order for relief is entered in any such proceeding; or 

        (g)   Inability to Pay Debts; Attachment.    (i) Any Borrower or any Subsidiary admits in writing its inability or
fails generally to pay its debts as they become due, or (ii) any writ or warrant of attachment or execution or similar process is issued or levied against all or any material part of the
property of any such Person and is not released, vacated or fully bonded within 30 days after its issue or levy; or 

        (h)   Judgments.    There is entered against any Borrower or any Subsidiary (i) one or more final judgments or
orders for the payment of money in an aggregate amount (as to all such judgments or orders) exceeding the Threshold Amount (to the extent not covered by independent third-party insurance as to which
the insurer does not dispute coverage), or (ii) any one or more non-monetary final judgments that have, or could reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect and, in either case, (A) enforcement proceedings are commenced by any creditor upon such judgment or order, or (B) there is a period of 10 consecutive days during
which a stay of enforcement of such judgment, by reason of a pending appeal or otherwise, is not in effect; or 

        (i)    ERISA.    (i) An ERISA Event occurs with respect to a Pension Plan or Multiemployer Plan which has resulted or
could reasonably be expected to result in liability of any Borrower under Title IV of ERISA to the Pension Plan, Multiemployer Plan or the PBGC in an aggregate amount in excess of the Threshold
Amount, or (ii) any Borrower or any ERISA Affiliate fails to pay when due, after the expiration of any applicable grace period, any installment payment with respect to its withdrawal liability
under Section 4201 of ERISA under a Multiemployer Plan in an aggregate amount in excess of the Threshold Amount; or 

        (j)    Invalidity of Loan Documents.    Any Loan Document or any provision thereof, at any time after its execution
and delivery and for any reason other than as expressly permitted hereunder or thereunder or satisfaction in full of all the Obligations, ceases to be in full force and effect; or any Loan Party or
any other Person contests in any manner the validity or enforceability of any Loan Document or any provision thereof; or any Loan Party denies that it has any or further liability or obligation under
any Loan Document, or purports to revoke, terminate or rescind any Loan Document or any provision thereof; or 

        (k)   Change of Control.    There occurs any Change of Control with respect to any Borrower other than SI Holdings;
or 

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        (l)    Material Adverse Effect.    There occurs any event or circumstance that has a Material Adverse Effect.

        8.02    Remedies Upon Event of Default.    If any Event of Default
occurs and is continuing, Agent shall, at the request of, or may, with the consent of, the Required Lenders, take any or all of the following actions: 

        (a)   declare
the commitment of each Lender to make Loans and any obligation of the L/C Issuer to make L/C Credit Extensions to be terminated, whereupon such commitments and
obligation shall be terminated; 

        (b)   declare
the unpaid principal amount of all outstanding Loans, all interest accrued and unpaid thereon, and all other amounts owing or payable hereunder or under any
other Loan Document to be immediately due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by Borrowers; 

        (c)   require
that Borrowers Cash Collateralize the L/C Obligations (in an amount equal to the then Outstanding Amount thereof); and 

        (d)   exercise
on behalf of itself, the Lenders and the L/C Issuer all rights and remedies available to it, the Lenders and the L/C Issuer under the Loan Documents; 

provided, however, that upon the occurrence of an actual or deemed entry of an order for relief with
respect to Borrowers under the Bankruptcy Code of the United States, the obligation of each Lender to make Loans and any obligation of the L/C Issuer to make L/C Credit Extensions shall automatically
terminate, the unpaid principal amount of all outstanding Loans and all interest and other amounts as aforesaid shall automatically become due and payable, and the obligation of Borrowers to Cash
Collateralize the L/C Obligations as aforesaid shall automatically become effective, in each case without further act of Agent or any Lender. 

        8.03    Application of Funds.    After the exercise of remedies
provided for in Section 8.02 (or after the Loans have automatically become immediately due and payable and the L/C Obligations have automatically
been required to be Cash Collateralized as set forth in the proviso to Section 8.02), any amounts received on account of the Obligations shall be
applied by Agent in the following order: 

First, to payment of that portion of the Obligations constituting fees, indemnities, expenses and other amounts (including fees, charges and
disbursements of counsel to Agent (including fees and time charges for attorneys who may be employees of Agent) and amounts payable under  Article III) payable to Agent in its capacity as such;

Second, to payment of that portion of the Obligations constituting fees, indemnities and other amounts (other than principal, interest and L/C Fees)
payable to Lenders and the L/C Issuer (including fees, charges and disbursements of counsel to the respective Lenders and the L/C Issuer (including fees and time charges for attorneys who may be
employees of any Lender or the L/C Issuer) and amounts payable under Article III), ratably among them in proportion to the respective amounts
described in this clause Second payable to them; 

Third, to payment of that portion of the Obligations constituting accrued and unpaid L/C Fees and interest on the Loans, L/C Borrowings and other
Obligations, ratably among Lenders and the L/C Issuer in proportion to the respective amounts described in this clause Third payable to them; 

Fourth, to payment of that portion of the Obligations constituting unpaid principal of the Loans and L/C Borrowings, ratably among Lenders and the L/C
Issuer in proportion to the respective amounts described in this clause Fourth held by them; 

Fifth, to Agent for the account of the L/C Issuer, to Cash Collateralize that portion of L/C Obligations comprised of the aggregate undrawn amount of
Letters of Credit; and 

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Last, the balance, if any, after all of the Obligations have been indefeasibly paid in full, to Borrowers or as otherwise required by Law. 

Subject
to Section 2.03(c), amounts used to Cash Collateralize the aggregate undrawn amount of Letters of Credit pursuant to clause  Fifth above shall be
applied to satisfy drawings under such Letters of Credit as they occur. If any amount remains on deposit as Cash Collateral after
all Letters of Credit
have either been fully drawn or expired, such remaining amount shall be applied to the other Obligations, if any, in the order set forth above. 

ARTICLE IX. ADMINISTRATIVE AGENT  

        9.01    Appointment and Authorization of Administrative Agent.    (a)
Each of the Lenders and the L/C issuer hereby irrevocably appoints Bank of America to act on its behalf as Administrative Agent hereunder and under the other Loan Documents and authorizes Agent to
take such actions on its behalf and to exercise such powers as are delegated to Agent by the terms hereof and thereof, together with such actions and powers as are reasonably incidental thereto. The
provisions of this Article are solely for the benefit of Agent, the Lenders and the L/C Issuer, and neither Borrowers nor any other Loan Party shall have rights as a third party beneficiary of any of
such provisions. 

        (b)   Agent
shall also act as the "collateral agent" under the Loan Documents, and each of the Lenders and the L/C Issuer hereby irrevocably appoints and authorizes Agent to
act as the agent of such Lender and the L/C Issuer for purposes of acquiring, holding and enforcing any and all Liens on Collateral granted by any of the Loan Parties to secure any of the Obligations,
together with such powers and discretion as are reasonably incidental thereto. In this connection, Agent, as "collateral agent" and any co-agents, sub-agents and
attorneys-in-fact appointed by Agent pursuant to Section 9.05 or otherwise for purposes of holding or enforcing any Lien
on the Collateral (or any portion thereof) granted under the Collateral Documents, or for exercising any rights and remedies thereunder at the direction of Agent), shall be entitled to the benefits of
all provisions of this Article IX and Article X, as though such co-agents, sub-agents and attorneys-in-fact were the "collateral agent"
under the Loan Documents as if set forth in full herein with respect thereto. 

        9.02    Rights as a Lender.    The Person serving as Agent hereunder
shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not Agent and the term "Lender" or "Lenders" shall, unless otherwise
expressly indicated or unless the context otherwise requires, include the Person serving as Agent hereunder in its individual capacity. Such Person and its Affiliates may accept deposits from, lend
money to, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with Borrowers or any Subsidiary or other Affiliate thereof as if such Person
were not Agent hereunder and without any duty to account therefor to Lenders. 

        9.03    Exculpatory Provisions.    Agent shall not have any duties or
obligations except those expressly set forth herein and in the other Loan Documents. Without limiting the generality of the foregoing, Agent: 

        (a)   shall
not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing; 

        (b)   shall
not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by
the other Loan Documents that Agent is required to exercise as directed in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided for herein
or in the other Loan Documents), provided that Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may
expose Agent to liability or that is contrary to any Loan Document or applicable Law; and 

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        (c)   shall
not, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not be liable for the failure to disclose, any
information relating to Borrowers or any of its Affiliates that is communicated to or obtained by the Person serving as Agent or any of its Affiliates in any capacity. 

        (d)   Agent
shall not be liable for any action taken or not taken by it (i) with the consent or at the request of the Required Lenders (or such other number or
percentage of the Lenders as shall be necessary, or as Agent shall believe in good faith shall be necessary, under the circumstances as provided in  Sections 8.02 and 10.01) or (ii) in the absence of its own gross negligence or willful
misconduct. Agent shall be deemed not to have knowledge of any Default unless and until written notice describing such Default is given to Agent by Borrowers, a Lender or the L/C Issuer. Agent shall
not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement or any other Loan Document,
(ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default, (iv) the validity, enforceability, effectiveness or genuineness of this
Agreement, any other Loan Document or any other agreement, instrument or document or (v) the satisfaction of any condition set forth in  Article IV or elsewhere herein, other than to confirm
receipt of items expressly required to be delivered to Agent. 

        9.04    Reliance by Administrative Agent.    Agent shall be entitled
to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message,
Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person. Agent also may rely upon any
statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not incur any liability for relying thereon. In determining compliance with any
condition hereunder to the making of a Loan, or the issuance of a Letter of Credit, that by its terms must be fulfilled to the satisfaction of a Lender or the L/C Issuer, Agent may presume that such
condition is satisfactory to such Lender or the L/C Issuer
unless Agent shall have received notice to the contrary from such Lender or the L/C Issuer prior to the making of such Loan or the issuance of such Letter of Credit. Agent may consult with legal
counsel (who may be counsel for Borrowers), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of
any such counsel, accountants or experts. 

        9.05    Delegation of Duties.    Agent may perform any and all of its
duties and exercise its rights and powers hereunder or under any other Loan Document by or through any one or more sub-agents appointed by Agent. Agent and any such sub-agent
may perform any and all of its duties and exercise its rights and powers by or through their respective Related Parties. The exculpatory provisions of this Article shall apply to any such
sub-agent and to the Related Parties of Agent and any such sub-agent, and shall apply to their respective activities in connection with the syndication of the credit facilities
provided for herein as well as activities as Agent. 

        9.06    Resignation of Agent.    Agent may at any time give notice of
its resignation to Lenders, the L/C Issuer and Borrowers. Upon receipt of any such notice of resignation, the Lenders shall have the right, in consultation with Borrowers, to appoint a successor,
which shall be a bank with an office in the United States, or an Affiliate of any such bank with an office in the United States. If no such successor shall have been so appointed by the Lenders and
shall have accepted such appointment within 30 days after the retiring Agent gives notice of its resignation, then the retiring Agent may on behalf of Lenders and the L/C Issuer, appoint a
successor Agent meeting the qualifications set forth above; provided that if Agent shall notify Borrowers and the Lenders that no qualifying Person has
accepted such appointment, then such resignation shall nonetheless become effective in accordance with such 

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notice
and (1) the retiring Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents (except that in the case of any collateral security held by
Agent on behalf of the Lenders or the L/C Issuer under any of the Loan Documents, the retiring Agent shall continue to hold such collateral security until such time as a successor Agent is appointed)
and (2) all payments, communications and determinations provided to be made by, to or through Agent shall instead be made by or to each Lender and the L/C Issuer directly, until such time as
the Lenders appoint a successor Agent as provided for above in this Section. Upon the acceptance of a successor's appointment as Agent hereunder, such successor shall succeed to and become vested with
all of the rights, powers, privileges and duties of the retiring (or retired) Agent, and the retiring Agent shall be discharged from all of its duties and obligations hereunder or under the other Loan
Documents (if not already discharged therefrom as provided above in this Section). The fees payable by Borrowers to a successor Agent shall be the same as those payable to its predecessor unless
otherwise agreed between Borrowers and such successor. After the retiring Agent's resignation hereunder and under the other Loan Documents, the provisions of this Article and  Section 10.04 shall
continue in effect for the benefit of such retiring Agent, its sub-agents and their respective Related Parties in
respect of any actions taken or omitted to be taken by any of them while the retiring Administrative Agent was acting as Administrative Agent. 

Any
resignation by Bank of America as Agent pursuant to this Section shall also constitute its resignation as L/C Issuer and Swing Line Lender. Upon the acceptance of a successor's appointment as
Agent hereunder, (a) such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring L/C Issuer and Swing Line Lender, (b) the
retiring L/C Issuer and Swing Line Lender shall be discharged from all of their respective duties and obligations hereunder or under the other Loan Documents, and (c) the successor L/C Issuer
shall issue letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of such succession or make other arrangements satisfactory to the retiring L/C Issuer to
effectively assume the obligations of the retiring L/C Issuer with respect to such Letters of Credit. 

        9.07    Non-Reliance on Agent and Other Lenders.    Each
Lender and the L/C Issuer acknowledges that it has, independently and without reliance upon Agent or any other Lender or any of their Related Parties and based on such documents and information as it
has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each Lender and the L/C Issuer also acknowledges that it will, independently and without reliance upon
Agent or any other Lender or any of their Related Parties and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or
not taking action under or based upon this Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder. 

        9.08    No Other Duties, Etc.    Anything herein to the contrary
notwithstanding, no Lender holding a title listed on the cover page hereof shall have any powers, duties or responsibilities under this Agreement or any of the other Loan Documents, except in its
capacity, as applicable, as Agent, a Lender or the L/C Issuer hereunder. 

        9.09    Administrative Agent May File Proofs of Claim.    In case of
the pendency of any proceeding under any Debtor Relief Law or any other judicial proceeding relative to any Loan Party, Agent (irrespective of whether the principal of any Loan or L/C Obligation shall
then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether Agent shall have made any demand on Borrowers) shall be entitled and empowered, by intervention
in such proceeding or otherwise: 

        (a)   to
file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans, L/C Obligations and all other Obligations that are
owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of Lenders, the 

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L/C
Issuer and Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of Lenders, the L/C Issuer and Agent and their respective agents and counsel and all
other amounts due Lenders, the L/C Issuer and Agent under Sections 2.03(i) and (j),  2.09 and
10.04) allowed in such judicial proceeding; and 

        (b)   to
collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same; 

and
any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender and the L/C Issuer to make such
payments to Agent and, in the event that Agent shall consent to the making of such payments directly to Lenders and the L/C Issuer, to pay to Agent any amount due for the reasonable compensation,
expenses, disbursements and advances of Agent and its agents and counsel, and any other amounts due Agent under Sections 2.09 and  10.04. Nothing
contained herein shall be deemed to authorize Agent to authorize or consent to or accept or adopt on behalf of any Lender or the L/C
Issuer any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Lender or the L/C Issuer or to authorize Agent to vote in respect of the claim
of any Lender or the L/C Issuer in any such proceeding. 

        9.10    Collateral Matters.    (a) Each Lender and the L/C Issuer
hereby irrevocably authorizes and directs Agent to enter into the Collateral Documents for the benefit of such Lender and the L/C Issuer. Each Lender and the L/C Issuer hereby agrees, and each holder
of any Note by the acceptance thereof will be deemed to agree, that, except as otherwise set forth in Section 10.01, any action taken by the Required Lenders, in accordance with the provisions
of this Agreement or the Collateral Documents, and the exercise by the Required Lenders of the powers set forth herein or therein, together with such other powers as are reasonably incidental thereto,
shall be authorized and binding upon all of Lenders and the L/C Issuer. Agent is hereby authorized (but not obligated) on behalf of all of Lenders and the L/C Issuer, without the necessity of any
notice to or further consent from any Lender or the L/C Issuer from time to time prior to, an Event of Default, to take any action with respect to any Collateral or Collateral Documents which may be
necessary to perfect and maintain perfected the Liens upon the Collateral granted pursuant to the Collateral Documents. 

        (b)   Each
Lender and the L/C issuer hereby irrevocably authorize Agent, at its option and in its discretion, 

          (i)  to
release any Lien on any property granted to or held by Agent under any Loan Document (A) upon termination of the Aggregate Commitments and payment in full of
all Obligations (other than contingent indemnification obligations) and the expiration or termination of all Letters of Credit, (B) that is sold or to be sold as part of or in connection with
any sale permitted hereunder or under any other Loan Document, (C) subject to Section 10.01, if approved, authorized or ratified in
writing by the Required Lenders, or (D) in connection with any foreclosure sale or other disposition of Collateral after the occurrence of an Event of Default; and 

         (ii)  to
subordinate any Lien on any property granted to or held by Agent under any Loan Document to the holder of any Lien on such property that is permitted by this
Agreement or any other Loan Document. 

Upon
request by Agent at any time, each Lender and the L/C Issuer will confirm in writing Agent's authority to release or subordinate its interest in particular types or items of Collateral pursuant
to this Section 9.10. 

        (c)   Subject
to (b) above, Agent shall (and is hereby irrevocably authorized by each Lender and the L/C Issuer, to execute such documents as may be necessary to
evidence the release or subordination of the Liens granted to Agent for the benefit of Agent and Lenders and the L/C Issuer herein or pursuant hereto upon the applicable Collateral; provided that
(i) Agent shall not be required 

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to
execute any such document on terms which, in Agent's opinion, would expose Agent to or create any liability or entail any consequence other than the release or subordination of such Liens without
recourse or warranty and (ii) such release or subordination shall not in any manner discharge, affect or impair the Obligations or any Liens upon (or obligations of Borrowers or any other Loan
Party in respect of) all interests retained by Borrowers or any other Loan Party, including the proceeds of the sale, all of which shall continue to constitute part of the Collateral. In the event of
any sale or transfer of Collateral, or any foreclosure with respect to any of the Collateral, Agent shall be authorized to deduct all expenses reasonably incurred by Agent from the proceeds of any
such sale, transfer or foreclosure. 

        (d)   Agent
shall have no obligation whatsoever to any Lender, the L/C Issuer or any other Person to assure that the Collateral exists or is owned by Borrowers or any other
Loan Party or is cared for, protected or insured or that the Liens granted to Agent herein or in any of the Collateral Documents or pursuant hereto or thereto have been properly or sufficiently or
lawfully created, perfected, protected or enforced or are entitled to any particular priority, or to exercise or to continue exercising at all or in any manner or under any duty of care, disclosure or
fidelity any of the rights, authorities and powers granted or available to Agent in this Section 9.10 or in any of the Collateral Documents, it
being understood and agreed that in respect of the Collateral, or any act, omission or event related thereto, Agent may act in any manner it may deem appropriate, in its sole discretion, given Agent's
own interest in the Collateral as one of Lenders and that Agent shall have no duty or liability whatsoever to Lenders or the L/C Issuer. 

        (e)   Each
Lender and the L/C Issuer hereby appoints each other Lender as agent for the purpose of perfecting Lenders' and the L/C Issuer's security interest in assets which,
in accordance with Article 9 of the UCC can be perfected only by possession. Should any Lender or the L/C Issuer (other than Agent) obtain possession of any such Collateral, such Lender or the
L/C Issuer shall notify Agent thereof, and, promptly upon Agent's request therefor shall deliver such Collateral to Agent or in accordance with Agent's instructions. 

ARTICLE X. MISCELLANEOUS  

        10.01    Amendments, Etc.    No amendment or waiver of any provision
of this Agreement or any other Loan Document, and no consent to any departure by Borrowers or any other Loan Party therefrom, shall be
effective unless in writing signed by the Required Lenders and Borrowers or the applicable Loan Party, as the case may be, and acknowledged by Agent, and each such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given; provided, however, that no
such amendment, waiver or consent shall: 

        (a)   waive
any condition set forth in Section 4.01(a) without the written consent of each Lender;  provided, however, in the sole discretion of Agent, only a waiver by Agent shall be required with
respect to immaterial matters or items specified in Section 4.01(a) (iii) or (iv) with respect to
which Borrowers have given assurances satisfactory to Agent that such items shall be delivered promptly following the Closing Date; 

        (b)   extend
or increase the Commitment of any Lender (or reinstate any Commitment terminated pursuant to Section 8.02)
without the written consent of such Lender; 

        (c)   postpone
any date fixed by this Agreement or any other Loan Document for any payment (excluding mandatory prepayments) of principal, interest, fees or other amounts due
to Lenders (or any of them) hereunder or under any other Loan Document without the written consent of each Lender directly affected thereby; 

        (d)   reduce
the principal of, or the rate of interest specified herein on, any Loan or L/C Borrowing, or (subject to clause (iv) of the second proviso to this  Section 10.01) any fees or other 

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amounts
payable hereunder or under any other Loan Document, without the written consent of each Lender directly affected thereby; provided,  however, that only the
consent of the Required Lenders shall be necessary (i) to amend the definition of "Default Rate" or to waive any
obligation of Borrowers to pay interest or L/C Fees at the Default Rate or (ii) to amend any financial covenant hereunder (or any defined term used therein), unless the effect of such amendment
would be to reduce the rate of interest on any Loan or L/C Borrowing or to reduce any fee payable hereunder, in which case the consent of all Lenders shall be required; 

        (e)   change  Section 2.13 or Section 8.03 in a manner that would
alter the pro rata sharing of payments required thereby without the written consent of each Lender; 

        (f)    change
any provision of this Section or the definition of "Required Lenders" or any other provision hereof specifying the number or percentage of Lenders required to
amend, waive or otherwise modify any rights hereunder or make any determination or grant any consent hereunder, without the written consent of each Lender; or 

        (g)   release
any Guarantor from the Guaranty or release the Liens on all or substantially all of the Collateral in any transaction or series of related transactions except in
accordance with the terms of any Loan Document, without the written consent of each Lender; 

and,
provided further, that (i) no amendment, waiver or consent shall, unless in writing and signed by the L/C Issuer in addition to the Lenders
required above, affect the rights or duties of the L/C Issuer under this Agreement or any Issuer Document relating to any Letter of Credit issued or to be issued by it; (ii) no amendment,
waiver or consent shall, unless in writing and signed by Swing Line Lender in addition to the Lenders required above, affect the rights or duties of Swing Line Lender under this Agreement;
(iii) no amendment, waiver or consent shall, unless in writing and signed by Agent in addition to the Lenders required above, affect the rights or duties of Agent under this Agreement or any
other Loan Document; and (iv) the Agent Fee Letter may be amended, or rights or privileges thereunder waived, in a writing executed only by the parties thereto. Notwithstanding anything to the
contrary herein, no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder, except that the Commitment of such Lender may not be increased or
extended without the consent of such Lender. 

        10.02    Notices; Effectiveness; Electronic Communications.    (a)  Notices Generally.    Except in the case of notices and other communications expressly permitted to be given by telephone (and except as
provided in subsection (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified
or registered mail or sent by telecopier as follows, and all notices and other communications expressly permitted hereunder to be given by telephone shall be made to the applicable telephone number,
as follows: 

          (i)  if
to Borrowers, Agent, the L/C Issuer or Swing Line Lender, to the address, telecopier number, electronic mail address or telephone number specified for such Person on  Schedule 10.02 ; and

         (ii)  if
to any other Lender, to the address, telecopier number, electronic mail address or telephone number specified in its Administrative Questionnaire. 

Notices
sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices sent by telecopier shall be deemed to have been
given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next business day for the recipient).
Notices delivered through electronic communications to the extent provided in subsection (b) below, shall be effective as provided in such subsection (b). 

        (b)    Electronic Communications.    Notices and other communications to Lenders and the L/C Issuer hereunder may be
delivered or furnished by electronic communication (including e-mail and 

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Internet
or intranet websites) pursuant to procedures approved by Agent, provided that the foregoing shall not apply to notices to any Lender or the L/C Issuer pursuant to Article II if such
Lender or the L/C Issuer, as applicable has notified the Agent that it is incapable of receiving notices under such Article by electronic communication. Agent or Borrowers may, in its discretion,
agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it, provided that approval of such procedures may be limited to
particular notices or communications. Unless Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender's
receipt of an acknowledgement from the intended recipient (such as by the "return receipt requested" function, as available, return e-mail or other written acknowledgement),  provided that if such notice
or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be
deemed to have been sent at the opening of business on the next business day for the recipient, and (ii) notices or communications posted to an Internet or intranet website shall be deemed
received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause (i) of notification that such notice or communication is
available and identifying the website address therefor. 

        (c)    The Platform.    THE PLATFORM IS PROVIDED "AS IS" AND "AS AVAILABLE." THE AGENT PARTIES (AS DEFINED BELOW) DO
NOT WARRANT THE ACCURACY OR COMPLETENESS OF BORROWER MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM BORROWER MATERIALS. NO WARRANTY OF ANY
KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER
CODE DEFECTS, IS MADE BY ANY AGENT PARTY IN CONNECTION WITH BORROWER MATERIALS OR THE PLATFORM. In no event shall Agent or any of its Related Parties (collectively, the "Agent Parties") have any
liability to Borrowers, any Lender, the L/C Issuer or any other Person for losses, claims, damages, liabilities or expenses of any kind (whether in tort, contract or otherwise) arising out of
Borrowers' or Agent's transmission of Borrower Materials through the Internet, except to the extent that such losses, claims, damages, liabilities or expenses are determined by a court of competent
jurisdiction by a final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Agent Party; provided, however, that in no event shall any Agent Party have
any liability to Borrowers, any Lender, the L/C Issuer or any other Person for indirect, special, incidental, consequential or punitive damages (as opposed to direct or actual damages). 

        (d)    Change of Address, Etc.    Each of Borrowers, Agent, the L/C Issuer and Swing Line Lender may change its
address, telecopier or telephone number for notices and other communications hereunder by notice to the other parties hereto. Each other Lender may change its address, telecopier or telephone number
for notices and other communications hereunder by notice to Borrowers, Agent, the L/C Issuer and Swing Line Lender. In addition, each Lender agrees to notify Agent from time to time to ensure that
Agent has on record (i) an effective address, contact name, telephone number, telecopier number and electronic mail address to which notices and other communications may be sent and
(ii) accurate
wire instructions for such Lender. Furthermore, each Public Lender agrees to cause at least one individual at or on behalf of such Public Lender to at all times have selected the "Private Side
Information" or similar designation on the content declaration screen of the Platform in order to enable such Public Lender or its delegate, in accordance with such Public Lender's compliance
procedures and applicable Law, including United States Federal and state securities Laws, to make reference to Borrower Materials that are not made available through the "Public Side Information"
portion of the Platform and that may contain material non-public information with respect to the Borrowers or their securities for purposes of United States Federal or state securities
laws. 

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        (e)    Reliance by Agent. L/C Issuer and Lenders.    Agent, the L/C Issuer and Lenders shall be entitled to rely and
act upon any notices (including telephonic Committed Loan Notices and Swing Line Loan Notices) purportedly given by or on behalf of Borrowers even if (i) such notices were not made in a manner
specified herein, were incomplete or were not preceded or followed by any other form of notice specified herein, or (ii) the terms thereof, as understood by the recipient, varied from any
confirmation thereof. Borrowers shall indemnify Agent, the L/C Issuer, each Lender and the Related Parties of each of them from all losses, costs, expenses and liabilities resulting from the reliance
by such Person on each notice purportedly given by or on behalf of Borrowers. All telephonic notices to and other telephonic communications with Agent may be recorded by Agent, and each of the parties
hereto hereby consents to such recording. 

        10.03    No Waiver; Cumulative Remedies.    No failure by any Lender,
the L/C Issuer or Agent to exercise, and no delay by any such Person in exercising, any right, remedy, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers
and privileges herein provided are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law. 

        10.04    Expenses; Indemnity; Damage Waiver.    (a)  Costs and Expenses.    Borrowers shall jointly and severally pay (i) all reasonable out-of-pocket expenses
incurred by Agent and its Affiliates (including the reasonable fees, charges and disbursements of counsel for Agent), in connection with the syndication of the credit facilities provided for herein,
the preparation, negotiation, execution, delivery and administration of this Agreement and the other Loan Documents or any amendments, modifications or waivers of the provisions hereof or thereof
(whether or not the transactions contemplated hereby or thereby shall be consummated), (ii) all reasonable out-of-pocket expenses incurred by the L/C Issuer in
connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder and (iii) all out-of-pocket expenses incurred
by Agent, any Lender or the L/C Issuer (including the fees, charges and disbursements of any counsel for Agent, any Lender or the L/C Issuer), and shall pay all fees and time charges for attorneys who
may be employees of Agent, any Lender or the L/C Issuer, in connection with the enforcement or protection of its rights (A) in connection with this Agreement and the other Loan Documents,
including its rights under this
Section, or (B) in connection with the Loans made or Letters of Credit issued hereunder, including all such out-of-pocket expenses incurred during any workout,
restructuring or negotiations in respect of such Loans or Letters of Credit. 

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        (b)    Indemnification by Borrowers.    Borrowers shall indemnify Agent (and any sub-agent thereof), each
Lender and the L/C Issuer, and each Related Party of any of the foregoing Persons (each such Person being called an "Indemnitee") against, and hold each
Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses (including the fees, charges and disbursements of any counsel for any Indemnitee), and shall indemnify
and hold harmless each Indemnitee from all fees and time charges and disbursements for attorneys who may be employees of any Indemnitee, incurred by any Indemnitee or asserted against any Indemnitee
by any third party or by Borrowers or any other Loan Party arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan Document or any
agreement or instrument contemplated hereby or thereby, the performance by the parties hereto of their respective obligations hereunder or thereunder, or the consummation of the transactions
contemplated hereby or thereby, or, in the case of Agent (and any sub-agent thereof) and its Related Parties only, the administration of this Agreement and the other Loan Documents,
(ii) any Loan or Letter of Credit or the use or proposed use of the proceeds therefrom (including any refusal by the L/C Issuer to honor a demand for payment under a Letter of Credit if the
documents presented in connection with such demand do not comply with the terms of such Letter of Credit), (iii) any actual or alleged presence or release of Hazardous Materials on or from any
property owned or operated by any Borrower or any of its Subsidiaries, or any Environmental Liability related in any way to any Borrower or any of its Subsidiaries, or (iv) any actual or
prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by a third party or by any Borrower or
any other Loan Party, and regardless of whether any Indemnitee is a party thereto IN ALL CASES, WHETHER OR NOT CAUSED BY OR ARISING, IN WHOLE OR IN PART, OUT OF THE
COMPARATIVE, CONTRIBUTORY OR SOLE NEGLIGENCE OF THE INDEMNITEE; provided that such indemnity shall not, as to any Indemnitee, be
available to the extent that such losses, claims, damages, liabilities or related expenses (x) are determined by a court of competent jurisdiction by final and nonappealable judgment to have
resulted from the gross negligence or willful misconduct of such Indemnitee or (y) result from a claim brought by any Borrower or any other Loan Party against an Indemnitee for breach in bad
faith of such Indemnitee's obligations hereunder or under any other Loan Document, if such Borrower or Loan Party has obtained a final and nonappealable judgment in its favor on such claim as
determined by a court of competent jurisdiction. 

        (c)    Reimbursement by Lenders.    To the extent that Borrowers for any reason fail to indefeasibly pay any amount
required under subsection (a) or (b) of this Section to Agent (or any sub-agent thereof), the L/C Issuer or any Related Party of any of the foregoing, each Lender severally
agrees to pay to Agent (or any such sub-agent), the L/C Issuer or such Related Party, as the case may be, such Lender's Applicable Percentage (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought) of such unpaid amount, provided that the unreimbursed expense or indemnified loss, claim, damage,
liability or related expense, as the case may be, was incurred by or asserted against Agent (or any such sub-agent) or the L/C Issuer in its capacity as such, or against any Related Party
of any of the foregoing acting for Agent (or any
such sub-agent) or L/C Issuer in connection with such capacity. The obligations of the Lenders under this subsection (c) are subject to the provisions of Section 2.12(d).  

        (d)    Waiver of Consequential Damages, Etc.    To the fullest extent permitted by applicable
law, Borrowers shall not assert, and hereby waives, any claim against any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or
actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the transactions contemplated hereby
or thereby, any Loan or Letter of Credit or the use of the proceeds thereof. No Indemnitee referred to in subsection (b) above shall be liable for any damages arising from the use by unintended
recipients of any information or other materials distributed to such unintended recipients by such Indemnitee through telecommunications, electronic or other information transmission systems in
connection with 

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this
Agreement or the other Loan Documents or the transactions contemplated hereby or thereby other than for direct or actual damages resulting from the gross negligence or willful misconduct of such
Indemnitee as determined by a final and nonappealable judgment of a court of competent jurisdiction. 

        (e)    Payments.    All amounts due under this Section shall be payable not later than ten Business Days after demand
therefor. 

        (f)    Survival.    The agreements in this Section shall survive the resignation of Agent, the L/C Issuer and the
Swing Line Lender, the replacement of any Lender, the termination of the Aggregate Commitments and the repayment, satisfaction or discharge of all the other Obligations. 

        10.05    Payments Set Aside.    To the extent that any payment by or
on behalf of Borrowers is made to Agent, the L/C Issuer or any Lender, or Agent, the L/C Issuer or any Lender exercises its right of setoff, and such payment or the proceeds of such setoff or any part
thereof is subsequently invalidated, declared to be fraudulent or preferential, set aside or required (including pursuant to any settlement entered into by Agent, the L/C Issuer or such Lender in its
discretion) to be repaid to a trustee, receiver or any other party, in connection with any proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of such recovery, the
obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such setoff had not occurred, and
(b) each Lender and the L/C Issuer severally agrees to pay to Agent upon demand its applicable share (without duplication) of any amount so recovered from or repaid by Agent, plus interest
thereon from the date of such demand to the date such payment is made at a rate per annum equal to the Federal Funds Rate from time to time in effect. The obligations of the Lenders and the L/C Issuer
under clause (b) of the preceding sentence shall survive the payment in full of the Obligations and the termination of this Agreement. 

        10.06    Successors and Assigns.    (a)  Successors and Assigns Generally.    The
provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and
their respective successors and assigns permitted hereby, except that neither Borrowers nor any other Loan Party may assign or otherwise transfer any of its rights or obligations hereunder without the
prior written consent of Agent, the L/C Issuer and each Lender and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an assignee in accordance
with the provisions of subsection (b) of this Section, (ii) by way of participation in accordance with the provisions of subsection (d) of this Section, or (iii) by way of
pledge or assignment of a security interest subject to the restrictions of subsection (f) of this Section (and any other attempted assignment or transfer by any party hereto shall be null and
void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby,
Participants to the extent provided in subsection (d) of this Section and, to the extent expressly contemplated hereby, the Related Parties of each of Agent, the L/C Issuer and the Lenders) any
legal or equitable right, remedy or claim under or by reason of this Agreement. 

        (b)    Assignments by Lenders.    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 Commitment and the Loans (including for purposes of this subsection (b), participations in L/C Obligations and in
Swing Line 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 or Acquisition Credit Commitment and the Loans at the
time owing to it under such Commitment or in the case of an assignment to a Lender or an Affiliate of a Lender or an Approved Fund no minimum amount need be assigned; and 

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        (B)  in
any case not described in subsection (b)(i)(A) of this Section, the aggregate amount of the Commitment (which for this purpose includes Loans outstanding
thereunder) or, if the Commitment is not then in effect, the principal outstanding balance of the Loans of the assigning Lender subject to each such assignment, determined as of the date the
Assignment and Assumption with respect to such assignment is delivered to Agent or, if "Trade Date" is specified in the Assignment and Assumption, as of the Trade Date, shall not be less than
$5,000,000 unless each of Agent and, so long as no Event of Default has occurred and is continuing, Borrowers otherwise consent (each such consent not to be unreasonably withheld or delayed);
provided, however, that concurrent assignments to members of an Assignee Group and concurrent assignments from members of an Assignee Group to a single Eligible Assignee (or to an Eligible Assignee
and members of its Assignee Group) will be treated as a single assignment for purposes of determining whether such minimum amount has been met. 

        (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 Loans or the Commitment assigned, except that this clause (ii) shall not (A) apply to the Swing
Line Lender's rights and obligations in respect of Swing Line Loans or (B) prohibit any Lender from assigning all or a portion of its rights and obligations among separate Facilities on a
non-pro rata basis. 

        (iii)    Required Consents.    No consent shall be required for any assignment except to the extent required by
subsection (b)(i)(B) of this Section and, in addition: 

        (A)  the
consent of Borrowers (such consent not to be unreasonably withheld or delayed) shall be required unless (1) an Event of Default has occurred and is continuing
at the time of such assignment or (2) such assignment is to a Lender or an Affiliate of a Lender or an Approved Fund; 

        (B)  the
consent of Agent (such consent not to be unreasonably withheld or delayed) shall be required for assignments in respect of any Revolving Credit Commitment or
Acquisition Credit Commitment if such assignment is to a Person that is not a Lender with a Commitment in respect of the applicable Facility, or an Affiliate of such Lender or an Approved Fund with
respect to such Lender. 

        (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); and 

        (D)  the
consent of the Swing Line Lender (such consent not to be unreasonably withheld or delayed) shall be required for any assignment in respect of the Revolving Credit
Commitments. 

        (iv)    Assignment and Assumption.    The parties to each assignment shall execute and deliver to Agent an Assignment
and Assumption, together with a processing and recordation fee in the amount of $3,500.00; provided,  however, that the Agent may, in its sole discretion,
elect to waive such processing and recordation fee in the case of any assignment. The assignee, if
it is not a Lender, shall deliver to Agent an Administrative Questionnaire. 

        (v)    No Assignment to Borrowers.    No such assignment shall be made to Borrowers or any of Borrowers' Affiliates or
Subsidiaries. 

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

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Subject
to acceptance and recording thereof by Agent pursuant to subsection (c) of this Section, from and after the effective date specified in each Assignment and Assumption, the assignee
thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Assumption, 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 Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment
and Assumption 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 3.01, 3.04, 3.05, and
10.04 with respect to facts and circumstances occurring prior to the effective date of such assignment. Upon request, Borrowers (at its expense) shall
execute and deliver a Note to the assignee Lender. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this subsection 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 subsection (d) of this Section. 

        (c)    Register.    Agent, acting solely for this purpose as an agent of Borrowers, shall maintain at Administrative
Agent's Office a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amounts of
the Loans and L/C Obligations owing to, each Lender pursuant to the terms hereof from time to time (the "Register"). The entries in the Register shall
be conclusive, and Borrowers, 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 Borrowers and any Lender, at any reasonable time and from time to time upon reasonable prior notice. 

        (d)    Participations.    Any Lender may at any time, without the consent of, or notice to, Borrowers or Agent, sell
participations to any Person (other than a natural person or Borrowers or any of Borrowers' Affiliates or Subsidiaries) (each, a "Participant") in all
or a portion of such Lender's rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or the Loans (including such Lender's participations in L/C Obligations
and/or Swing Line Loans) owing to it); provided that (i) such Lender's obligations under this Agreement shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) Borrowers, Agent, the L/C Issuer and the Lenders shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sells such a participation
shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement;  provided that such agreement
or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, waiver
or other modification described in the first proviso to Section 10.01 that affects such Participant. Subject to subsection (e) of this
Section, Borrowers agree that each Participant shall be entitled to the benefits of Sections 3.01,  3.04 and 3.05 to the same extent as if it were a Lender and had acquired its interest by assignment
pursuant to subsection (b) of this Section. To the extent permitted by
law, each Participant also shall be entitled to the benefits of Section 10.08 as though it were a Lender,  provided such Participant agrees to be
subject to Section 2.13 as though it were a Lender. 

        (e)    Limitations upon Participant Rights.    A Participant shall not be entitled to receive any greater payment
under Section 3.01 or 3.04 than the applicable Lender would have been entitled to receive with
respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with Borrowers' prior written consent. 

        (f)    Certain Pledges.    Any Lender may at any time pledge or assign a security interest in all or any portion of
its rights under this Agreement (including under its Note, if any) to secure obligations of 

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such
Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank; provided that no such pledge or assignment shall
release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto. 

        (g)    Electronic Execution of Assignments.    The words "execution," "signed," "signature," and words of like import
in any Assignment and Assumption shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or
enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal
Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act. 

        (h)    Deemed Consent of Borrowers.    If the consent of Borrowers to an assignment to an Eligible Assignee is
required hereunder (including a consent to an assignment which does not meet the minimum assignment threshold specified in  Section 10.06(b)(i)(B)), Borrowers shall be deemed to have given its
consent five Business Days after the date notice thereof has been delivered
to Borrowers by the assigning Lender (through Agent) unless such consent is expressly refused by Borrowers prior to such fifth Business Day. 

        (i)    Resignation as L/C Issuer or Swing Line Lender.    Notwithstanding anything to the contrary contained herein,
if at any time Bank of America assigns all of its Revolving Credit Commitment and Revolving Credit Loans pursuant to subsection (b) above, Bank of America may, (i) upon 30 days'
notice to Borrowers and the Lenders, resign as L/C Issuer and/or (ii) upon 30 days' notice to Borrowers, resign as Swing Line Lender. In the event of any such resignation as L/C Issuer
or Swing Line Lender, Borrowers shall be entitled to appoint from among Lenders a successor L/C Issuer or Swing Line Lender hereunder; provided,  however,
that no failure by Borrowers to appoint any such successor shall affect the resignation of Bank of America as L/C Issuer or Swing Line Lender,
as the case may be. If Bank of America resigns as L/C Issuer, it shall retain all the rights, powers, privileges and duties of the L/C Issuer hereunder with respect to all Letters of Credit
outstanding as of the effective date of its resignation as L/C Issuer and all L/C Obligations with respect thereto (including the right to require
the Lenders to make Base Rate Committed Loans or fund risk participations in Unreimbursed Amounts pursuant to Section 2.03(c)). If Bank of
America resigns as Swing Line Lender, it shall retain all the rights of Swing Line Lender provided for hereunder with respect to Swing Line Loans made by it and outstanding as of the effective date of
such resignation, including the right to require the Lenders to make Base Rate Committed Loans or fund risk participations in outstanding Swing Line Loans pursuant to  Section 2.04(c). Upon the
appointment of a successor L/C Issuer and/or Swing Line Lender, (a) such successor shall succeed to and become
vested with all of the rights, powers, privileges and duties of the retiring L/C Issuer or Swing Line Lender, as the case may be, and (b) the successor L/C Issuer shall issue letters of credit
in substitution for the Letters of Credit, if any, outstanding at the time of such succession or make other arrangements satisfactory to Bank of America to effectively assume the obligations of Bank
of America with respect to such Letters of Credit. 

        (j)    Replacement of Defaulting Lenders.    If any Lender (a "Subject
Lender") (i) makes demand upon the Borrowers for (or if the Borrowers are otherwise required to pay) amounts pursuant to  Section 3.04 (ii) gives notice pursuant to
Section 3.02 requiring a Conversion of
such Subject Lender's Eurodollar Rate Loans to Base Rate Loans or any other change in the basis upon which interest is to accrue in respect of such Subject Lender's Eurodollar Rate Loans or suspending
such Lender's obligation to make Loans as, or to convert Loans into, Eurodollar Rate Loans, or (iii) becomes a Defaulting Lender, Borrowers may, within 180 days of receipt by Borrowers
of such demand or notice (or the occurrence of such other event causing Borrowers to be required to pay such compensation) or within 180 days of such Lender becoming a Defaulting Lender, give
notice (a "Replacement Notice") in writing to the Agent and such Subject Lender of its intention to replace such Subject Lender with a 

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financial
institution (a "Replacement Lender") designated in such Replacement Notice. Upon the delivery of such notice, such Subject Lender shall,
subject to the payment of any amounts due pursuant to Section 3.04, assign, in accordance with  Section 10.06(b) or (d)
, all of its Commitments, Loans and other rights and obligations under
this Agreement and all other Loan Documents to such designated Replacement Lender; provided, however,
that (i) such assignment shall be without recourse, representation or warranty and (ii) the purchase price paid by such designated Replacement Lender shall be in the amount of such
Subject Lender's Loans and its Percentage in respect of the Revolving Loan Commitments of all outstanding Loans as to which such Lender shall have made payments, together with all accrued and unpaid
interest and fees in respect thereof, plus all other amounts (including the amounts demanded and unreimbursed under Section 3.04 and including
any applicable make-whole or prepayment premium which would have been due had the Borrowers made a voluntary prepayment on such date), owing to such Subject Lender hereunder. Upon the
effective date of an assignment described above, the designated Replacement Lender shall become a "Lender" for all purposes under this Agreement and the other Loan Documents. 

        10.07    Treatment of Certain Information; Confidentiality.    Each of
Agent, Lenders and the L/C Issuer agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its Affiliates and to its and its
Affiliates' respective partners, directors, officers, employees, agents, advisors and representatives (it being understood that the Persons to whom such disclosure is made will be informed of the
confidential nature of such Information and instructed to keep such Information confidential), (b) to the extent requested by any regulatory authority, purporting to have jurisdiction over it
(including any self-regulatory authority, such as the National Association of Insurance Commissioners), (c) to the extent required by applicable laws or regulations or by any
subpoena or similar legal process, (d) to any other party hereto, (e) in connection with the
exercise of any remedies hereunder or under any other Loan Document or any action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or
thereunder, (f) subject to an agreement containing provisions substantially the same as those of this Section, to (i) any assignee of or Participant in, or any prospective assignee of or
Participant in, any of its rights or obligations under this Agreement, or (ii) any actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating to
Borrowers and its obligations, (g) with the consent of Borrowers or (h) to the extent such Information (x) becomes publicly available other than as a result of a breach of this
Section or (y) becomes available to Agent, any Lender, the L/C Issuer or any of their respective Affiliates on a nonconfidential basis from a source other than Borrowers. For purposes of this
Section, "Information" means all information received from Borrowers or any Subsidiary relating to Borrowers or any Subsidiary or any of their
respective businesses, other than any such information that is available to Agent, any Lender or the L/C Issuer on a nonconfidential basis prior to disclosure by Borrowers or any Subsidiary,  provided
that, in the case of information received from Borrowers or any Subsidiary after the date hereof, such information is clearly identified at the
time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if
such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information. Each of Agent, the Lenders and
the L/C Issuer acknowledges that (a) the Information may include material non-public information concerning Borrowers or a Subsidiary, as the case may be, (b) it has
developed compliance procedures regarding the use of material non-public information and (c) it will handle such material non-public information in accordance with
applicable Law, including Federal and state securities Laws. 

        10.08    Right of Setoff.    If an Event of Default shall have
occurred and be continuing, each Lender, the L/C Issuer and each of their respective Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by applicable
law, to set off and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time 

78

 

held
and other obligations (in whatever currency) at any time owing by such Lender, the L/C Issuer or any such Affiliate to or for the credit or the account of Borrowers or any other Loan Party
against any and all of the obligations of Borrowers or such Loan Party now or hereafter existing under this Agreement or any other Loan Document to such Lender or the L/C Issuer or any such Affiliate,
irrespective of whether or not such Lender or the L/C Issuer shall have made any demand under this Agreement or any other Loan Document and although such obligations of Borrowers or such Loan Party
may be contingent or unmatured or are owed to a branch or office of such Lender or the L/C Issuer different from the branch or office holding such deposit or obligated on such indebtedness. The rights
of each Lender, the L/C Issuer and their respective Affiliates under this Section are in addition to other rights and remedies (including other rights of setoff) that such Lender, the L/C Issuer or
their respective Affiliates may have. Each Lender and the L/C Issuer agrees to notify Borrowers and Agent promptly after any such setoff and application,  provided that the failure to give such notice
shall not affect the validity of such setoff and application. 

        10.09    Interest Rate Limitation.    Notwithstanding anything to the
contrary contained in any Loan Document, the interest paid or agreed to be paid under the Loan Documents shall not exceed the maximum rate of non-usurious interest permitted by applicable
Law (the "Maximum Rate"). If Agent or any Lender shall receive interest in an amount that exceeds the Maximum Rate, the
excess interest shall be applied to the principal of the Loans or, if it exceeds such unpaid principal, refunded to Borrowers. In determining whether the interest contracted for, charged, or received
by Agent or a Lender exceeds the Maximum Rate, such Person may, to the extent permitted by applicable Law, (a) characterize any payment that is not principal as an expense, fee, or premium
rather than interest, (b) exclude voluntary prepayments and the effects thereof, and (c) amortize, prorate, allocate, and spread in equal or unequal parts the total amount of interest
throughout the contemplated term of the Obligations hereunder. 

        10.10    Counterparts; Integration; Effectiveness.    This Agreement
may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single
contract. This Agreement and the other Loan Documents constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof. Except as provided in Section 4.01, this Agreement shall become effective
when it shall have been executed by Agent and when Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto. Delivery of an
executed counterpart of a signature page of this Agreement by telecopy shall be effective as delivery of a manually executed counterpart of this Agreement. 

        10.11    Survival of Representations and Warranties.    All
representations and warranties made hereunder and in any other Loan Document or other document delivered pursuant hereto or thereto or in connection herewith or therewith shall survive the execution
and delivery hereof and thereof. Such representations and warranties have been or will be relied upon by Agent and each Lender, regardless of any investigation made by Agent or any Lender or on their
behalf and notwithstanding that Agent or any Lender may have had notice or knowledge of any Default at the time of any Credit Extension, and shall continue in full force and effect as long as any Loan
or any other Obligation hereunder shall remain unpaid or unsatisfied or any Letter of Credit shall remain outstanding. 

        10.12    Severability.    If any provision of this Agreement or the
other Loan Documents is held to be illegal, invalid or unenforceable, (a) the legality, validity and enforceability of the remaining provisions of this Agreement and the other Loan Documents
shall not be affected or impaired thereby and (b) the parties shall endeavor in good faith negotiations to replace the illegal, invalid or unenforceable provisions with valid provisions the
economic effect of which comes as close as possible to that of the illegal, invalid or unenforceable provisions. The invalidity of a provision in a particular jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction. 

79

 

        10.13    Governing Law; Jurisdiction; Etc.    (a)  GOVERNING LAW.    THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF RHODE ISLAND. 

        (b)    SUBMISSION TO JURISDICTION.    BORROWERS AND EACH OTHER LOAN PARTY IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR
ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF RHODE ISLAND SITTING IN PROVIDENCE COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE STATE OF RHODE ISLAND,
AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND
EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH RHODE ISLAND STATE COURT OR, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN
OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT AGENT, ANY LENDER OR THE L/C
ISSUER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST BORROWERS OR ANY OTHER LOAN PARTY OR ITS PROPERTIES IN THE COURTS OF ANY
JURISDICTION. 

        (c)    WAIVER OF VENUE.    BORROWERS AND EACH OTHER LOAN PARTY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (B) OF THIS SECTION. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN
INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT. 

        (d)    SERVICE OF PROCESS.    EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR
NOTICES IN SECTION 10.02, PROVIDED, HOWEVER,
SERVICE OF PROCESS SHALL NOT BE DONE BY ELECTRONIC MAIL. NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW. 

        10.14    Waiver of Jury Trial.    EACH PARTY HERETO HEREBY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES
THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED
TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION. 

80

 

        10.15    No Advisory or Fiduciary
Responsibility.    In connection with all aspects of each transaction contemplated hereby (including in connection with any amendment, waiver
or other modification hereof or of any other Loan Document), Borrowers and each other Loan Party acknowledges and agrees and acknowledges its Affiliates' understanding that that: (i) (A) the
services regarding this Agreement provided by Agent are arm's-length commercial transactions between Borrowers, each other Loan Party and their respective Affiliates, on the one hand, and Agent, on
the other hand, (B) each of Borrowers and the other Loan Parties have consulted their own legal, accounting, regulatory and tax advisors to the extent they have deemed appropriate, and
(C) Borrowers and each other Loan Party is capable of evaluating and understanding, and understands and accepts, the terms, risks and conditions of the transactions contemplated hereby and by
the other Loan Documents; (ii) (A) Agent is and has been acting solely as a principal and, except as expressly agreed in writing by the relevant parties, has not been, is not, and will
not be acting as an advisor, agent or fiduciary, for Borrowers, any other Loan Party, or any of their respective Affiliates, or any other Person and (B) Agent does not have any obligation to
Borrowers, any other Loan Party or any of their Affiliates with respect to the transaction contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents; and
(iii) Agent and its Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of Borrowers, the other Loan Parties and their respective
Affiliates, and Agent has no obligation to disclose any of such interests to Borrowers, any other Loan Party of any of their respective Affiliates. To the fullest extent permitted by law, each of
Borrowers and the other Loan Parties hereby waive and release, any claims that it may have against Agent with respect to any breach or alleged breach of agency or fiduciary duty in connection with any
aspect of any transaction contemplated hereby.  

        10.16    USA PATRIOT Act Notice.    Each
Lender that is subject to the Act (as hereinafter defined) and Agent (for itself and not on behalf of any Lender) hereby notifies Borrower that pursuant to the requirements of the USA PATRIOT Act
(Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the "Act"), it is required to obtain, verify and record information that identifies Borrower, which information
includes the name and address of Borrower and other information that will allow such Lender or Agent, as applicable, to identify Borrower in accordance with the Act. 

(The
next page is the signature page.) 

81

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

	 	 	SUMMER INFANT, INC.
	

 	
 	

By:	

/s/ Jason P. Macari
 Jason P. Macari, President
	

 	
 	
SUMMER INFANT (USA), INC.
	

 	
 	

By:	

/s/ Jason P. Macari
 Jason P. Macari, President
	

 	
 	
SUMMER INFANT EUROPE LIMITED
	

 	
 	

By:	

/s/ Jason P. Macari
 Jason P. Macari, President
	

 	
 	
SUMMER INFANT ASIA LIMITED
	

 	
 	

By:	

/s/ Jason P. Macari
 Jason P. Macari, President
	

 	
 	
SUMMER INFANT CANADA, LIMITED
	

 	
 	

By:	

/s/ Jason P. Macari
 Jason P. Macari, President
	

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

 	
 	

By:	

/s/ Todd G. MacNeill
 Todd G. MacNeill, Vice President
	

 	
 	
BANK OF AMERICA, N.A., as a Lender, L/C Issuer and Swing Line Lender
	

 	
 	

By:	

/s/ David J. Angell
 David J. Angell, Senior Vice President

(Signatures
continued on next page.) 

	 	 	RBS CITIZENS, NATIONAL ASSOCIATION
	

 	
 	

By:	

/s/ Robert R. Kent
 Robert R. Kent, Senior Vice President

	 

	 	 	BANK RHODE ISLAND
	

 	
 	

By:	

/s/ William L. Tsonus
 Name: William L. Tsonus

Title: Senior Vice President

 

 
 

SCHEDULE 2.01    
    

COMMITMENTS

AND APPLICABLE PERCENTAGES  

Revolving Credit Commitments  

	Revolving Credit Lender
 
	 	Revolving Credit

Commitment
	 	Applicable Revolving

Credit Percentage
	 
	Bank of America, N.A. 	 	$	20,347,826.08	 	56.521739130	%
	

RBS Citizens, National Association	
 	
$	

7,826,086.96	
 	

21.739130435	
%
	

Bank Rhode Island	
 	
$	

7,826,086.96	
 	

21.739130435	
%
	

Total	
 	
$	

36,000,000.00	
 	

100.000000000	
%

Acquisition Credit Commitments  

	Acquisition Credit Lender
 
	 	Acquisition Credit

Commitment
	 	Applicable Acquisition

Credit Percentage
	 
	Bank of America, N.A. 	 	$	5,652,173.92	 	56.521739130	%
	

RBS Citizens, National Association	
 	
$	

2,173,913.04	
 	

21.739130435	
%
	

Bank Rhode Island	
 	
$	

2,173,913.04	
 	

21.739130435	
%
	

Total	
 	
$	

10,000,000.00	
 	

100.000000000	
%

Commitments  

	Lender
 
	 	Commitment
	 	Applicable Percentage
	 
	Bank of America, N.A. 	 	$	26,000,000	 	56.521739130	%
	

RBS Citizens, National Association	
 	
$	

10,000,000	
 	

21.739130435	
%
	

Bank Rhode Island	
 	
$	

10,000,000	
 	

21.739130435	
%
	

Total	
 	
$	

46,000,000	
 	

100.000000000	
%

        Notwithstanding
anything set forth in the Credit Agreement to the contrary, on the Closing Date, the Lenders shall each purchase a portion of the following existing LIBOR contracts in an
amount equal to such Lender's Applicable Percentage of the amount of such LIBOR contract: 

	Amount:	 	$700,000.00
	Maturity Date:	 	5/1/2008
	Base Rate:	 	3.23938%
	Margin:	 	2.00000%
	All-In Rate	 	5.23938%
	

Amount:	
 	

$15,591,000.00
	Maturity Date:	 	5/13/2008
	Base Rate:	 	3.0950%
	Margin:	 	2.0000%
	All-In Rate	 	5.0950%

 

 
 

SCHEDULE 10.02    
    

ADMINISTRATIVE AGENT'S OFFICE,

CERTAIN ADDRESSES FOR NOTICES  

BORROWER:

c/o
Summer Infant (USA), Inc.

1275 Park East Drive

Woonsocket, Rhode Island 02895 

Attention:
Jason Macari

Telephone:

Telecopier:

Electronic Mail: jmacari@summerinfant.com

Website Address: www.summerinfant.com 

U.S.
Taxpayer Identification Number (Summer Infant, Inc.): 20-1994619

U.S. Taxpayer Identification Number (Summer Infant (USA), Inc.): 20-8641043

VAT Number (Summer Infant Europe Limited): 789 9287 34

Canadian Taxpayer Number (Summer Infant Canada, Limited): BN 835413212 NP 

ADMINISTRATIVE AGENT:

Administrative Agent's Office
(for payments and Requests for Credit Extensions):

Bank of America, N.A.

111 Westminster Street

Providence, Rhode Island 02903

Attention: David J. Angell, Senior Vice President

Telephone: 401.278.2906

Telecopier: 401.278.3411

Electronic Mail: david.j.angell@bankofamerica.com

Account No.:

Ref: Summer Infant

ABA# 026009593 

Other Notices as Administrative Agent:

Bank of America, N.A.

Agency Management

100 Federal Street

Boston, Massachusetts 02110

Attention: Todd G. MacNeill, Vice President

Telephone: 617.434.6842

Telecopier: 617.790.1361

Electronic Mail: todd.g.macneill@bankofamerica.com 

L/C ISSUER:
Standby Letters of Credit:

Bank
of America, N.A.

Trade Operations-Los Angeles #22621

1000 W. Temple Street, 7th Floor

CA9-705-07-05

Los Angeles, CA 90012-1514 

	Attention:
	Tai
Anh Lun

Officer

Telephone: 213.481.7840

Telecopier: 213.580.8442

Electronic Mail: tai_anh.lu@bankofamerica.com

Bank
of America, N.A.

Trade Operations

One Fleet Way

Mail Code: PA6-580-02-30

Scranton, PA 18507 

	Attention:
	Alfonso
(Al) Malave

Telephone: 570.330.4212

Telecopier: 570.330.4186

Electronic Mail: alfonso.malave@bankofamerica.com 

Commercial Letters of Credit

Bank
of America, N.A.

Trade Operations-Charlotte

Interstate Tower Ste

121 W Trade Street

Mail Code: NC1-005-21-01

Charlotte, NC 28255-0001 

	Attention:
	Bette
F. Stover

Assistant Vice President

Telephone: 704.386.8617

Telecopier: 704.386.0706

Electronic Mail: bette.stover@bankofamerica.com 

Bank
of America, N.A.

Trade Operations-Scranton

1 Fleet Way

Mail Code: PA6-580-02-30

Scranton, PA 18507 

	Attention:
	Robert
D. Morgan

Telephone: 570.330.4570

Telecopier: 800.755.8740

Electronic Mail: robert.d.morgan@bankofamerica.com 

Bankers Acceptance

Bank
of America, N.A.

Trade Operations-Los Angeles

1000 W. Temple Street, 7th Floor

CA9-705-07-05

Los Angeles, CA 90012-1514 

	Attention:
	Frantz
Bellevue

Vice President

Telephone: 213.580.8476

Telecopier: 213.580.8444

Electronic Mail: frantz.bellevue@bankofamerica.com 

SWING LINE LENDER:

Bank
of America, N.A.

111 Westminster Street

Providence, Rhode Island 02903

Attention: David J. Angell, Senior Vice President

Telephone: 401.278.2906

Telecopier: 401.278.3411

Electronic Mail: david.j.angell@bankofamerica.com

Account #[TBD]

Ref: Summer Infant

ABA# 026009593 

 

 
 

EXHIBIT A    
    

FORM OF COMMITTED LOAN NOTICE  

Date:                  ,    

To:    Bank
of America, N.A., as Agent 

Ladies
and Gentlemen: 

        Reference
is made to that certain Credit Agreement, dated as of April 10, 2008 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time,
the "Agreement;" the terms defined therein being used herein as therein defined), among Summer Infant, Inc., Summer Infant (USA), Inc.,
Summer Infant Europe Limited, Summer Infant Asia Limited and Summer Infant Canada, Limited (collectively, the "Borrower"), the Lenders from time to time
party thereto, and Bank of America, N.A., as Administrative Agent, L/C Issuer and Swing Line Lender. 

        The
undersigned hereby requests (select one): 

	 	 	A Borrowing of Committed Loans	 	A conversion or continuation of Committed Loans

	1.
	On                                        
    (a
Business Day).

	2.
	In
the amount of $                        .

	3.
	Comprised
of                                         
                                    .

                               [Type of Committed Loan requested]

	4.
	For
Eurodollar Rate Loans: with an Interest Period of      months. 

        The
Committed Borrowing, if any, requested herein complies with the provisos to the first sentence of Section 2.01 of the
Agreement. 

	 	 	SUMMER INFANT, INC.
	

 	
 	

By:	

 
	 	 	 	
 Title:
	

 	
 	
SUMMER INFANT (USA), INC.
	

 	
 	

By:	

 
	 	 	 	
 Title:
	

 	
 	
SUMMER INFANT EUROPE LIMITED
	

 	
 	

By:	

 
	 	 	 	
 Title:
	

 	
 	
SUMMER INFANT ASIA LIMITED
	

 	
 	

By:	

 
	 	 	 	
 Title:
	

 	
 	
SUMMER INFANT CANADA, LIMITED
	

 	
 	

By:	

 
	 	 	 	
 Title:

A-1

Form of Committed Loan Notice 

 

 
 

EXHIBIT B    
    

FORM OF SWING LINE LOAN NOTICE  

Date:                  ,    

	To:
	Bank
of America, N.A., as Swing Line Lender

Bank of America, N.A., as Administrative Agent 

Ladies
and Gentlemen: 

        Reference
is made to that certain Credit Agreement, dated as of April 10, 2008 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time,
the "Agreement;" the terms defined therein being used herein as therein defined), among Summer Infant, Inc., Summer Infant (USA), Inc.,
Summer Infant Europe Limited, Summer Infant Asia Limited and Summer Infant Canada, Limited (collectively, the "Borrower"), the Lenders from time to time
party thereto, and Bank of America, N.A., as Administrative Agent, L/C Issuer and Swing Line Lender. 

        The
undersigned hereby requests a Swing Line Loan: 

	1.
	On                                        
    (a
Business Day).

	2.
	In
the amount of $                        . 

        The
Swing Line Borrowing requested herein complies with the requirements of the provisos to the first sentence of Section 2.04(a)
of the Agreement. 

	 	 	SUMMER INFANT, INC.
	

 	
 	

By:	

 
	 	 	 	
 Title:
	

 	
 	
SUMMER INFANT (USA), INC.
	

 	
 	

By:	

 
	 	 	 	
 Title:
	

 	
 	
SUMMER INFANT EUROPE LIMITED
	

 	
 	

By:	

 
	 	 	 	
 Title:
	

 	
 	
SUMMER INFANT ASIA LIMITED
	

 	
 	

By:	

 
	 	 	 	
 Title:
	

 	
 	
SUMMER INFANT CANADA, LIMITED
	

 	
 	

By:	

 
	 	 	 	
 Title:

 

 
 

EXHIBIT C    
    

FORM OF NOTE  

$                                    

        FOR
VALUE RECEIVED, the undersigned (collectively, jointly and severally, "Borrower"), hereby promises to pay
to                                    or
registered assigns ("Lender"), in accordance with the provisions of the Agreement (as hereinafter defined), the principal amount of each Loan from time
to time made by the Lender to Borrower under that certain Credit Agreement, dated as of April 10, 2008 (as amended, restated, extended, supplemented or otherwise modified in writing from time
to time, the "Agreement;" the terms defined therein being used herein as therein defined), among Borrower, the Lenders from time to time party thereto,
and Bank of America, N.A., as Administrative Agent, L/C Issuer and Swing Line Lender. 

        Borrower
promises to pay interest on the unpaid principal amount of each Loan from the date of such Loan until such principal amount is paid in full, at such interest rates and at such
times as provided in the Agreement. Except as otherwise provided in Section 2.04(f) of the Agreement with respect to Swing Line Loans, all
payments of principal and interest shall be made to Agent for the account of the Lender in Dollars in immediately available funds at the Administrative Agent's Office. If any amount is not paid in
full when due hereunder, such unpaid amount shall bear interest, to be paid upon demand, from the due date thereof until the date of actual payment (and before as well as after judgment) computed at
the per annum rate set forth in the Agreement. 

        This
Note is one of the Notes referred to in the Agreement, is entitled to the benefits thereof and may be prepaid in whole or in part subject to the terms and conditions provided
therein. This Note is also entitled to the benefits of the Security Agreement and is secured by the Collateral. Upon the occurrence and continuation of one or more of the Events of Default specified
in the Agreement, all amounts then remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable all as provided in the Agreement. Loans made by the Lender shall be
evidenced by one or
more loan accounts or records maintained by the Lender in the ordinary course of business. The Lender may also attach schedules to this Note and endorse thereon the date, amount and maturity of its
Loans and payments with respect thereto. 

        Borrower,
for itself, its successors and assigns, hereby waives diligence, presentment, protest and demand and notice of protest, demand, dishonor and non-payment of this
Note. 

        THIS
NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF RHODE ISLAND. 

	 	 	SUMMER INFANT, INC.
	

 	
 	

By:	

 
	 	 	 	
 Title:
	

 	
 	
SUMMER INFANT (USA), INC.
	

 	
 	

By:	

 
	 	 	 	
 Title:
	

 	
 	
SUMMER INFANT EUROPE LIMITED
	

 	
 	

By:	

 
	 	 	 	
 Title:

	

 	
 	
SUMMER INFANT ASIA LIMITED
	

 	
 	

By:	

 
	 	 	 	
 Title:
	

 	
 	
SUMMER INFANT CANADA, LIMITED
	

 	
 	

By:	

 
	 	 	 	
 Title:

C-2

Form of Note 

LOANS AND PAYMENTS WITH RESPECT THERETO  

	Date
 
	 	Type of Loan

Made
	 	Amount of

Loan Made
	 	End of

Interest

Period
	 	Amount of

Principal or

Interest Paid

This Date
	 	Outstanding

Principal

Balance This

Date
	 	Notation

Made By

	 	 	 	 	 	 	 	 	 	 	 	 	 

 

 
 

EXHIBIT D    
    

FORM OF COMPLIANCE CERTIFICATE  

Financial
Statement Date:                        , 

To:
Bank of America, N.A., as Administrative Agent

Ladies
and Gentlemen: 

        Reference
is made to that certain Credit Agreement, dated as of April 10, 2008 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time,
the "Agreement;" the terms defined therein being used herein as therein defined), among Summer Infant, Inc., Summer Infant (USA), Inc.,
Summer Infant Europe Limited, Summer Infant Asia Limited and Summer Infant Canada, Limited (collectively, "Borrower"), the Lenders from time to time
party thereto, and Bank of America, N.A., as Administrative Agent, L/C Issuer and Swing Line Lender. 

        The
undersigned Responsible Officer hereby certifies as of the date hereof that he/she is
the                                         
                   of Borrower, and that, as such, he/she is authorized to execute and deliver
this Certificate to Agent on the behalf of Borrower, and that: 

        [Use following paragraph 1 for fiscal year-end financial
statements]

        1.     The
Borrower has delivered the year-end audited financial statements required by Section 6.01(a) of the
Agreement for the fiscal year of Borrower ended as of the above date, together with the report and opinion of an independent certified public accountant required by such section. 

        [Use following paragraph 1 for fiscal quarter-end financial
statements]

        1.     The
Borrower has delivered the unaudited financial statements required by Section 6.01(b) of the Agreement for the
fiscal quarter of Borrower ended as of the above date. Such financial statements fairly present the financial condition, results of operations and cash flows of Borrower and its Subsidiaries in
accordance with GAAP as at such date and for such period, subject only to normal year-end audit adjustments and the absence of footnotes. 

        2.     The
undersigned has reviewed and is familiar with the terms of the Agreement and has made, or has caused to be made under his/her supervision, a detailed review of the
transactions and condition (financial or otherwise) of Borrower during the accounting period covered by such financial statements. 

        3.     A
review of the activities of Borrower during such fiscal period has been made under the supervision of the undersigned with a view to determining whether during such
fiscal period Borrower performed and observed all its Obligations under the Loan Documents, and 

        [select one:]

        [to the best knowledge of the undersigned during such fiscal period, Borrower performed and observed each covenant and condition of the Loan Documents
applicable to it, and no Default has occurred and is continuing.]

        —or—

        [to the best knowledge of the undersigned, during such fiscal period, the following covenants or conditions have not been performed or observed and
the following is a list of each such Default and its nature and status:]

        4.     The
representations and warranties of Borrower contained in Article V of the Agreement, and/or any representations
and warranties of Borrower or any other Loan Party that are contained in any document furnished at any time under or in connection with the Loan Documents, are true and correct on and as of the date
hereof, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct as of such earlier date, and except that for
purposes of this Compliance Certificate, the representations and warranties contained in 

 

subsections (a)
and (b) of Section 5.05 of the Agreement shall be deemed to refer to the most recent statements furnished pursuant
to clauses (a) and (b), respectively, of Section 6.01 of the Agreement, including the statements in connection with which this Compliance
Certificate is delivered. 

        5.     The
financial covenant analyses and information set forth on Schedules 2 and 3 attached hereto are true and
accurate on and as of the date of this Certificate. 

        IN
WITNESS WHEREOF, the undersigned has executed this Certificate as of                  ,        . 

	 	 	SUMMER INFANT, INC.
	

 	
 	
By:	
 	

 	

 
	 	 	 	 	

	 	 	 	 	Title:	 
	

 	
 	
SUMMER INFANT (USA), INC.
	

 	
 	
By:	
 	

 	

 
	 	 	 	 	

	 	 	 	 	Title:	 
	

 	
 	
SUMMER INFANT EUROPE LIMITED
	

 	
 	

By:	
 	

 	

 
	 	 	 	 	

	 	 	 	 	Title:	 
	

 	
 	
SUMMER INFANT ASIA LIMITED
	

 	
 	

By:	
 	

 	

 
	 	 	 	 	

	 	 	 	 	Title:	 
	

 	
 	
SUMMER INFANT CANADA, LIMITED
	

 	
 	

By:	
 	

 	

 
	 	 	 	 	

	 	 	 	 	Title:	 

D-2

  
For the Quarter/Year ended                                    
("Statement Date") 

SCHEDULE 2

to the Compliance Certificate

($ in 000's) 

I.     Section 6.12(a)—Net Worth.  

	 	A.	 	Net Worth at Statement Date:	 	 	 
	

 	
 	

1.	
 	

Total tangible assets:	
 	
$	

    
	

 	
 	

2.	
 	

Total Liabilities (minus non-current portion of Subordinated Liabilities):	
 	
$	

    
	

 	
 	

3.	
 	

Net Worth (Line I.A.1 less Line I.A.2):	
 	
$	

    
	 	

B.	
 	

1.	
 	

$50,000,000	
 	
$	

    
	

 	
 	

2.	
 	
plus the sum of 50% of net income after income taxes (without subtracting losses) earned in each fiscal year ending after the date of the Agreement:	
 	
$	

    
	

 	
 	

3.	
 	
Minimum Required Net Worth (I.B.1 plus I.B.2):	
 	
$	

    
	 	

C.	
 	

Excess (deficient) for covenant compliance (Line I.A.3 less I.B.3):	
 	
$	

    

II.    Section 6.12(b)—Funded Debt to EBITDA Ratio.  

	 	A.	 	Funded Debt	 	 	 	 
	

 	
 	

1.	
 	

all outstanding liabilities for borrowed money plus other interest-bearing liabilities, including current and long-term liabilities:	
 	
$	

 	
 
	

 	
 	

2.	
 	
less the non-current portion of Subordinated Liabilities:	
 	
$	

(                        	
)
	

 	
 	

3.	
 	

Total Funded Debt:	
 	
$	

 	
 
	 	

B.	
 	

EBITDA	
 	
 	

 	
 
	

 	
 	

1.	
 	

net income:	
 	
$	

 	
 
	

 	
 	

2.	
 	
less income or plus loss from discontinued operations and extraordinary items:	
 	
$	

 	
 
	

 	
 	

3.	
 	
plus income taxes:	
 	
$	

 	
 
	

 	
 	

4.	
 	
plus interest expense:	
 	
$	

 	
 
	

 	
 	

5.	
 	
plus depreciation, depletion and amortization:	
 	
$	

 	
 
	

 	
 	

6.	
 	
plus permitted Addbacks for Basic Comfort Acquisition	
 	
$	

 	
 
	

 	
 	

7.	
 	
plus permitted Addbacks for Kiddopotamus Merger	
 	
$	

 	
 
	

 	
 	

8.	
 	

Total EBITDA:	
 	
$	

 	
 
	 	

C.	
 	

Ratio (Line II.A.3 ÷ Line II.B.8):	
 	
 	

            to 1.0	
 
	 	

Minimum Required:	
 	
 	

3.50 to 1.00	
 

III.  Section 6.12(c)—Basic Fixed Charge Coverage Ratio.  

	 	A.	 	EBITDA	 	 	 	 
	

 	
 	

1.	
 	

net income:	
 	
$	

 	
 
	

 	
 	

2.	
 	
less income or plus loss from discontinued operations and extraordinary items:	
 	
$	

 	
 
	

 	
 	

3.	
 	
plus income taxes:	
 	
$	

 	
 
	

 	
 	

4.	
 	
plus interest expense:	
 	
$	

 	
 
	

 	
 	

5.	
 	
plus depreciation, depletion and amortization:	
 	
$	

 	
 
	

 	
 	

6.	
 	
plus permitted Addbacks for Basic Comfort Acquisition	
 	
$	

 	
 
	

 	
 	

7.	
 	
plus permitted Addbacks for Kiddopotamus Merger	
 	
$	

 	
 
	

 	
 	

8.	
 	

Total EBITDA:	
 	
$	

 	
 
	

 	
 	

9.	
 	
plus lease expense and rent expense:	
 	
$	

 	
 
	

 	
 	

10.	
 	
minus income tax, dividends, withdrawals and other distributions:	
 	
$	

(                        	
)
	

 	
 	

11.	
 	

Total:	
 	
$	

 	
 
	 	

B.	
 	

Fixed Charges	
 	
 	

 	
 
	

 	
 	

1.	
 	

interest expense:	
 	
$	

 	
 
	

 	
 	

2.	
 	
plus lease and rent expense:	
 	
$	

 	
 
	

 	
 	

3.	
 	
plus the current portion of long term liabilities:	
 	
$	

 	
 
	

 	
 	

4.	
 	
plus the current portion of capitalized lease obligations:	
 	
$	

 	
 
	

 	
 	

5.	
 	

Total Fixed Charges:	
 	
$	

 	
 
	 	

C.	
 	

Ratio (Line III.A.11 ÷ Line III.B.5):	
 	
 	

            to 1.00	
 
	 	

Minimum Required:	
 	
 	

1.25 to 1.00	
 

 

 
 

EXHIBIT E    
    

 
 

FORM
  OF
  ASSIGNMENT AND ASSUMPTION    
    

        This Assignment and Assumption (this "Assignment and Assumption") is dated as of the Effective Date set forth
below and is entered into by and between [the][each] Assignor identified in item 1 below
([the][each, an] "Assignor") and  [the][each] Assignee identified in item 2 below ([the][each, an]
"Assignee"). [It is understood and agreed that the rights and obligations of [the Assignors][the Assignees] hereunder are several and not
joint.]. Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement identified below (the
"Credit Agreement"), receipt of a copy of which is hereby acknowledged by the Assignee. The Standard Terms and Conditions set forth in Annex 1
attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment and Assumption as if set forth herein in full. 

        For
an agreed consideration, [the][each] Assignor hereby irrevocably sells and assigns to [the
Assignee][the respective Assignees], and [the][each] Assignee hereby irrevocably purchases and assumes from
[the Assignor][the respective Assignors], subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the
Effective Date inserted by Agent as contemplated below (i) all of [the Assignor's][the respective Assignors'] rights and obligations in
[its capacity as a Lender][their respective capacities as Lenders] under the Credit Agreement and any other documents or instruments delivered pursuant
thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights and obligations of [the Assignor][the
respective Assignors] under the respective facilities identified below (including, without limitation, the Letters of Credit and Swing Line Loans included in such facilities) and
(ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action and any other right of [the Assignor (in its capacity as a
Lender)][the respective Assignors (in their respective capacities as Lenders)] against any Person, whether known or unknown, arising under or in connection with the
Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including, but not
limited to, contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to
clause (i) above (the rights and obligations sold and assigned by [the][any] Assignor to
[the][any] Assignee pursuant to clauses (i) and (ii) above being referred to herein collectively as,
[the][an] "Assigned Interest"). Each such sale and assignment is without recourse to
[the][any] Assignor and, except as expressly provided in this Assignment and Assumption, without representation or warranty by
[the][any] Assignor. 

	1.
	Assignor[s]:
                                    

	2.
	Assignee[s]:
                                     for
each Assignee, indicate Affiliate of [identify
Lender]]

	3.
	Borrower(s):
Summer Infant, Inc., Summer Infant (USA), Inc., Summer Infant Europe Limited, Summer Infant Asia Limited and Summer Infant Canada, Limited

	4.
	Administrative
Agent: Bank of America, N.A., as the administrative agent under the Credit Agreement

	5.
	Credit
Agreement: Credit Agreement, dated as of April 10, 2008, among Summer Infant, Inc., Summer Infant (USA), Inc., Summer Infant Europe Limited, Summer Infant
Asia Limited and Summer Infant Canada, Limited, the Lenders from time to time party thereto, Bank of America, N.A., as Administrative Agent, L/C Issuer and Swing Line Lender 

 
	6.
	Assigned
Interest[s]: 

	Assignor[s]
 
	 	Assignee[s]
	 	Facility

Assigned
	 	Aggregate

Amount of

Commitment/

Loans for

all Lenders
	 	Amount of

Commitment/

Loans

Assigned
	 	Percentage

Assigned of

Commitment/

Loans
	 	CUSIP

No.

	 	 	 	 	 	 	$	 	$	 	%	 	 
	 	 	 	 	 	 	$	 	$	 	%	 	 
	 	 	 	 	 	 	$	 	$	 	%	 	 

[7.    Trade Date:
                                    ]  

Effective Date:                                    ,
20            [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF
RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.] 

The
terms set forth in this Assignment and Assumption are hereby agreed to: 

	 	 	ASSIGNOR
 [NAME OF ASSIGNOR]
	

 	
 	
By:	
 	

    

	 	 	 	 	Title:	 	 
	

 	
 	

ASSIGNEE
 [NAME OF ASSIGNEE]
	

 	
 	
By:	
 	

    

	 	 	 	 	Title:	 	 

[Consented to and] Accepted: 

Bank
of America, N. A., as

    Administrative Agent 

	By:	 	    
	 	 
	 	 	Title:	 	 	 	 
	
[Consented to:]	
 	

 	
 	

 
	

By:	
 	

    
	
 	

 
	 	 	Title:	 	 	 	 

E-2

 

 
 

ANNEX 1 TO ASSIGNMENT AND ASSUMPTION    
    

STANDARD TERMS AND CONDITIONS FOR ASSIGNMENT AND ASSUMPTION  

1.    Representations and Warranties.

        1.1.    Assignor.    [The][Each] Assignor (a) represents and
warrants that (i) it is the legal and beneficial owner of [the][the relevant] Assigned Interest,
(ii) [the][such] Assigned Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full power and
authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby; and (b) assumes no responsibility
with respect to (i) any statements, warranties or representations made in or in connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financial condition of Borrower, any of its Subsidiaries or Affiliates or any
other Person obligated in respect of any Loan Document or (iv) the performance or observance by Borrower, any of its Subsidiaries or Affiliates or any other Person of any of their respective
obligations under any Loan Document. 

        1.2.    Assignee.    [The][Each] Assignee (a) represents and
warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated
hereby and to become a Lender under the Credit Agreement, (ii) it meets all the requirements to be an assignee under Section 10.06(b)(iii),(v) and (vi) of the Credit Agreement
(subject to such consents, if any, as may be required under Section 10.06(b)(iii) of the Credit Agreement), (iii) from and after the Effective Date, it shall be bound by the provisions
of the Credit Agreement as a Lender thereunder and, to the extent of [the][the relevant] Assigned Interest, shall have the obligations of a Lender
thereunder, and (iv) it is sophisticated with respect to decisions to acquire assets of the type represented by [the][such] Assigned Interest and
either it, or the Person exercising discretion in making its decision to acquire [the][such] Assigned Interest, is
experienced in acquiring assets of such type, (v) it has received a copy of the Credit Agreement, and has received or has been accorded the opportunity to receive copies of the most recent
financial statements delivered pursuant to Section [      ] thereof, as applicable, and such other documents and
information as it deems appropriate to make its own credit analysis and decision to enter into this Assignment and Assumption and to purchase
[the][such] Assigned Interest ,and (vi) it has independently and without reliance upon Agent or any other Lender and based on such documents and
information as it has deemed appropriate, made its own credit analysis and decision to enter into this Assignment and Assumption and to purchase
[the][such] Assigned Interest; and (b) agrees that (i) it will, independently and without reliance upon Agent,
[the][any] Assignor or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Loan Documents
are required to be performed by it as a Lender. 

2.    Payments.    From and after the Effective Date, Agent shall make all payments in respect of
[the][each] Assigned Interest (including payments of principal, interest, fees and other amounts) to [the][the
relevant] Assignor for amounts which have accrued to but excluding the Effective Date and to [the][the relevant] Assignee for amounts which
have accrued from and after the Effective Date. 

3.    General Provisions.    This Assignment and Assumption shall be binding upon, and inure to the benefit of, the parties hereto
and their respective successors and assigns. This Assignment and Assumption may be executed in any number of counterparts, which together shall constitute one instrument. Delivery of an executed
counterpart of a signature page of this Assignment and Assumption by telecopy shall be effective as delivery of a manually executed counterpart of this Assignment and Assumption. This Assignment and
Assumption shall be governed by, and construed in accordance with, the law of the State of Rhode Island. 

E-3

Form of Assignment and Assumption 

 
 

EXHIBIT F    
    

FORM OF BORROWING BASE CERTIFICATE

SUMMER INFANT

MONTH-END COLLATERAL REPORT AND BORROWING CERTIFICATE  

For
the Month-ending                                    

	REVOLVING FACILITY	 	 
	
DOMESTIC ACCOUNTS RECEIVABLE (Excluding Target/Toys R Us)	
 	

 
	

1.)	
 	

End of Month Balance	
 	

$
	

2.)	
 	

Ineligible Accounts Receivable, Determined without Duplication	
 	

$
	

3.)	
 	

Net Eligible Accounts Receivable	
 	

$
	
ELIGIBLE TARGET RECEIVABLES	
 	

 
	

4.)	
 	

End of Month Balance	
 	

$
	

5.)	
 	

Ineligible Accounts Receivable, Determined without Duplication	
 	

$
	

6.)	
 	

Net Eligible Accounts Receivable	
 	

$
	

7.)	
 	

Total Eligible Target Receivables (98% of Line 6)	
 	

$
	
ELIGIBLE TOYS R US RECEIVABLES	
 	

 
	

8.)	
 	

End of Month Balance	
 	

$
	

9.)	
 	

Ineligible Accounts Receivable, Determined without Duplication	
 	

$
	

10.)	
 	

Net Eligible Accounts Receivable	
 	

$
	

11.)	
 	

Total Eligible Toys R Us Receivables (86% of Line 10)	
 	

$
	
ELIGIBLE FOREIGN RECEIVABLES	
 	

 
	

12.)	
 	

End of Month Balance	
 	

$
	

13.)	
 	

Ineligible Accounts Receivable, Determined without Duplication	
 	

$
	

14.)	
 	

Net Eligible Accounts Receivable	
 	

$
	
DOMESTIC INVENTORY	
 	

 
	

15.)	
 	

Month Ending Inventory Balance	
 	

$
	

16.)	
 	

Less: Ineligible Domestic Inventory	
 	

$
	

17.)	
 	

Eligible Inventory	
 	

$
	
FOREIGN INVENTORY	
 	

 
	

18.)	
 	

Month Ending Inventory Balance	
 	

$
	

19.)	
 	

Less: Ineligible Foreign Inventory	
 	

$
	

20.)	
 	

Eligible Inventory	
 	

$
	
IN-TRANSIT INVENTORY	
 	

 
	

21.)	
 	

Month Ending Inventory Balance	
 	

$
	

22.)	
 	

Less: Ineligible In-Transit Inventory	
 	

$

	

23.)	
 	

Eligible In-Transit Inventory	
 	

$
	
BORROWING BASE	
 	

 

	 

	24.)	 	a)	 	Domestic Accounts Receivable (80% of Line 3)	 	$
	

 	
 	

b)	
 	

Target Receivables (85% of Line 7)	
 	

$
	

 	
 	

c)	
 	

Toys R Us Receivables (85% of Line 11)	
 	

$
	

 	
 	

d)	
 	

Foreign Receivables (60% of Line 14)	
 	

$
	

 	
 	

e)	
 	

Domestic Inventory (60% of Line 17)	
 	

$
	

 	
 	

f)	
 	

Foreign Inventory (50% of Line 20)	
 	

$
	

 	
 	

g)	
 	

Intransit Inventory (55% of Line 23)	
 	

$

	 

	25.)	 	Inventory Availability (Lesser of Lines 24e + 24f + 24g OR $23,000,000)	 	$
	

26.)	
 	

Gross Availability (Lines 24a + 24b + 24c + 24d + 25)	
 	

$
	

27.)	
 	

Lesser of Line 26 or $46,000,000 (Line Limit)	
 	

$

	 

	LOAN DETAIL	 	 	 	 
	

 	
 	

Prime Rate	
 	

$	
 	

 
	

 	
 	

LIBOR	
 	

$	
 	

 
	

 	
 	

Other	
 	

$	
 	

 

	 

	28.)	 	Total Loans Outstanding at Month-End	 	$
	

29.)	
 	

Net Borrowing Base Availability (Line 27 minus Line 28)	
 	

$

The undersigned represents and warrants that:  

	(A)
	The
information provided above and in the accompanying supporting documentation is true and correct, and complies fully with the conditions, terms and covenants of the Credit
Agreement dated April 10, 2008 as amended to the date (the "Agreement") between the undersigned and Bank of America (the "Bank").

	(B)
	Since
the date of the last financial statement or certification furnished to the Bank.

	(i)
	There
has been no material adverse change in the financial condition or operations of the undersigned, and

	(ii)
	There
is no event which is, or with notice or lapse of time or both would be, a default under the Agreement 

	Summer Infant, Inc.	 
	

By:	

 	

 
	 	
 Print Name:

Title:	 
	

Summer Infant Europe Limited	

 
	

By:	

 	

 
	 	
 Print Name:

Title:	 
	

Summer Infant Asia Limited	

 
	

By:	

 	

 
	 	
 Print Name:

Title:	 
	

Summer Infant Canada, Limited	

 
	

By:	

 	

 
	 	
 Print Name:

Title:	 

Date:

QuickLinks

Exhibit 10.20

CREDIT AGREEMENT

CREDIT AGREEMENT

ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS

Applicable Rate

ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY

ARTICLE IV. CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

ARTICLE V. REPRESENTATIONS AND WARRANTIES

ARTICLE VI. AFFIRMATIVE COVENANTS

SCHEDULE 2.01

SCHEDULE 10.02

EXHIBIT A

EXHIBIT B

EXHIBIT C

EXHIBIT D

EXHIBIT E

FORM OF ASSIGNMENT AND ASSUMPTION

ANNEX 1 TO ASSIGNMENT AND ASSUMPTION

EXHIBIT F

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