Document:

Exhibit 10.2

 

THIRD AMENDED AND RESTATED REVOLVING CREDIT NOTE

 

	
  $19,000,000

  	
  Baltimore, Maryland

  

 

April     , 2009

 

FOR VALUE RECEIVED, TVI CORPORATION, a Maryland
corporation (“TVI”), CAPA MANUFACTURING CORP., a Maryland corporation (“CAPA”),
SAFETY TECH INTERNATIONAL, INC., a Maryland corporation (“Safety Tech”) and
SIGNATURE SPECIAL EVENT SERVICES, INC., a Maryland corporation, formerly named “TVI
Holdings One, Inc.” (“Signature TVI”), jointly and severally (each of TVI,
CAPA, Safety Tech and Signature TVI, a “Borrower”; TVI, CAPA, Safety Tech and
Signature TVI, collectively, the “Borrowers”), promise to pay to the order of BRANCH BANKING
AND TRUST COMPANY, a
North Carolina banking corporation (the “Lender”), the principal sum of
NINETEEN MILLION DOLLARS ($19,000,000) (the “Principal Sum”), or so much
thereof as has been or may be advanced/readvanced to or for the account of the
Borrowers pursuant to the terms and conditions of the Financing Agreement (as
hereinafter defined) under the Revolving Credit Facility (as that term is
defined in the Financing Agreement), together with interest thereon at the rate
or rates hereinafter provided, in accordance with the following:

 

1.                                       Interest.

 

Commencing as of the date hereof and continuing until
repayment in full of all sums due hereunder, the unpaid Principal Sum shall
bear interest in accordance with Section 2.5 (Interest and Certain Fee
Provisions) of the Financing Agreement.

 

2.                                       Payments and Maturity.

 

The unpaid Principal Sum, together with interest
thereon at the rate or rates provided above, shall be payable as follows:

 

(a)           Interest only on the unpaid Principal
Sum shall be due and payable in accordance with Section 2.5.3 (Payment of
Interest) of the Financing Agreement; and

 

(b)           Unless sooner paid, the unpaid
Principal Sum, together with interest accrued and unpaid thereon, shall be due
and payable in full on the Revolving Credit Termination Date (as defined in the
Financing Agreement).

 

The fact that the balance hereunder may be reduced to
zero from time to time pursuant to the Financing Agreement will not affect the
continuing validity of this Note or the Financing Agreement, and the balance
may be increased to the Principal Sum after any such reduction to zero.

 

3.                                       Default Interest.

 

Upon the occurrence and during the continuance of an
Event of Default (as hereinafter defined), the unpaid Principal Sum shall bear
interest thereafter at the Post-Default Rate (as defined in the Financing
Agreement) until such Event of Default is cured.

 

1

 

4.                                       Late Charges.

 

If the Borrowers shall fail to make any payment under
the terms of this Note within ten (10) days after the date such payment is
due, the Borrowers shall pay to the Lender on demand a late charge equal to
five percent (5%) of such payment.

 

5.                                       Application and Place of Payments.

 

Unless otherwise set forth in the Financing Agreement,
all payments, made on account of this Note shall be applied first to the
payment of any late charge then due hereunder, second to the payment of any
prepayment fee then due hereunder, third to the payment of accrued and unpaid
interest then due hereunder, and the remainder, if any, shall be applied to the
unpaid Principal Sum.  All payments on account
of this Note shall be paid in lawful money of the United States of America in
immediately available funds during regular business hours of the Lender at its
principal office in Baltimore, Maryland or at such other times and places as
the Lender may at any time and from time to time designate in writing to the
Borrowers.

 

6.                                       Prepayment.

 

Without implying any limitation on the Borrowers’
obligation to pay the Early Termination Fee as and when provided in Section 2.5.2
(Early Termination Fee) of the Financing Agreement, the Borrowers may prepay
the Principal Sum in whole or in part at any time without premium or penalty.

 

7.                                       Financing Agreement and Other Financing
Documents.

 

This Note is the “Revolving Credit Note” described in
an Amended and Restated Financing and Security Agreement dated as of February 22,
2008 by and among the Borrowers and the Lender (as amended by (a) that
certain First Amendment to Amended and Restated Financing and Security
Agreement dated as of July 3, 2008, (b) that certain Limited
Forbearance Agreement dated as of November 20, 3008, (c) that certain
Acknowledgment and Agreement dated as of January 30, 2009, (d) that
certain Agreement for Post-Petition Financing dated as of even date herewith and (e) as may be otherwise
amended, modified, restated, substituted, extended and renewed at any time and
from time to time, the “Financing Agreement”). 
The indebtedness evidenced by this Note is included within the meaning
of the term “Obligations” as defined in the Financing Agreement.  This Note is one of the “Financing Documents”
(as that term is defined in the Financing Agreement).

 

8.                                       Security.

 

This Note is secured as provided in the Financing
Agreement.

 

9.                                       Events of Default.

 

The occurrence of any one or more of the following
events shall constitute an event of default (individually, an “Event of Default”
and collectively, the “Events of Default”) under the terms of this Note:

 

2

 

(a)           The failure of the Borrowers to pay
to the Lender when due any and all amounts payable by the Borrowers to the
Lender under the terms of this Note; or

 

(b)           The occurrence of an event of default
(as defined therein) under the terms and conditions of any of the other
Financing Documents.

 

10.                                 Remedies.

 

Upon the occurrence and during the continuance of an
Event of Default, at the option of the Lender, all amounts payable by the
Borrowers to the Lender under the terms of this Note shall immediately become
due and payable by the Borrowers to the Lender without notice to the Borrowers
or any other person, and the Lender shall have all of the rights, powers, and
remedies available under the terms of this Note, any of the other Financing
Documents and all applicable laws.  The
Borrowers and all endorsers, guarantors, and other parties who may now or in the
future be primarily or secondarily liable for the payment of the indebtedness
evidenced by this Note hereby severally waive presentment, protest and demand,
notice of protest, notice of demand and of dishonor and non-payment of this
Note and expressly agree that this Note or any payment hereunder may be
extended from time to time without in any way affecting the liability of the
Borrowers, guarantors and endorsers.

 

11.                                 Expenses.

 

The Borrowers promise to pay to the Lender on demand
by the Lender all costs and expenses incurred by the Lender in connection with
the collection and enforcement of this Note, including, without limitation,
reasonable attorneys’ fees and expenses and all court costs.

 

12.                                 Notices.

 

Any notice, request, or demand to or upon the Borrowers
or the Lender shall be deemed to have been properly given or made when
delivered in accordance with Section 8.1 (Notices) of the Financing
Agreement.

 

13.                                 Miscellaneous.

 

Each right, power, and remedy of the Lender as
provided for in this Note or any of the other Financing Documents, or now or
hereafter existing under any applicable law or otherwise shall be cumulative
and concurrent and shall be in addition to every other right, power, or remedy
provided for in this Note or any of the other Financing Documents or now or
hereafter existing under any applicable law, and the exercise or beginning of
the exercise by the Lender of any one or more of such rights, powers, or
remedies shall not preclude the simultaneous or later exercise by the Lender of
any or all such other rights, powers, or remedies.  No failure or delay by the Lender to insist
upon the strict performance of any term, condition, covenant, or agreement of
this Note or any of the other Financing Documents, or to exercise any right,
power, or remedy consequent upon a breach thereof, shall constitute a waiver of
any such term, condition, covenant, or agreement or of any such breach, or
preclude the Lender from exercising any such right, power, or remedy at a later
time or times.  By accepting payment
after the due date of any amount payable under the terms of this Note, the
Lender shall not be deemed to waive the right either to require prompt payment
when due of all other amounts payable under 

 

3

 

the terms of this Note or
to declare an Event of Default for the failure to effect such prompt payment of
any such other amount.  No course of
dealing or conduct shall be effective to amend, modify, waive, release, or
change any provisions of this Note.

 

14.                                 Partial  Invalidity.

 

In the event any provision of this Note (or any part
of any provision) is held by a court of competent jurisdiction to be invalid,
illegal, or unenforceable in any respect, such invalidity, illegality, or
unenforceability shall not affect any other provision (or remaining part of the
affected provision) of this Note; but this Note shall be construed as if such
invalid, illegal, or unenforceable provision (or part thereof) had not been
contained in this Note, but only to the extent it is invalid, illegal, or
unenforceable.

 

15.                                 Captions.

 

The captions herein set forth are for convenience only
and shall not be deemed to define, limit, or describe the scope or intent of
this Note.

 

16.                                 Applicable  Law.

 

The Borrowers acknowledge and agree that this Note
shall be governed by the laws of the State of Maryland, even though for the
convenience and at the request of the Borrowers, this Note may be executed
elsewhere, and solely to the extent applicable, the Bankruptcy Code (as defined
in the Financing Agreement).

 

17.                                 Consent to Jurisdiction.

 

Each Borrower irrevocably submits to the jurisdiction
of the Bankruptcy Court (as defined in the Financing Agreement), any state or
federal court sitting in the State of Maryland over any suit, action, or
proceeding arising out of or relating to this Note or any of the other
Financing Documents.  Each Borrower
irrevocably waives, to the fullest extent permitted by law, any objection that
such Borrower may now or hereafter have to the laying of venue of any such
suit, action, or proceeding brought in any such court and any claim that any
such suit, action, or proceeding brought in any such court has been brought in
an inconvenient forum.  Final judgment in
any such suit, action, or proceeding brought in any such court shall be
conclusive and binding upon each Borrower and may be enforced in any court in
which any Borrower is subject to jurisdiction by a suit upon such judgment,
provided that service of process is effected upon the Borrower as provided in this
Note or as otherwise permitted by applicable law.

 

18.                                 Service of Process.

 

Each Borrower hereby consents to process being served
in any suit, action, or proceeding instituted in connection with this Note by (a) the
mailing of a copy thereof by certified mail, postage prepaid, return receipt
requested, to the Borrowers and (b) serving a copy thereof upon the
registered agent for TVI as set forth in the records of the Maryland State
Department of Assessments and Taxation, the agent hereby designated and
appointed by each of the Borrowers as each Borrower’s agent for service of
process.  Each Borrower irrevocably
agrees that such service shall be deemed in every respect effective service of
process upon the Borrower in any 

 

4

 

such suit, action or
proceeding, and shall, to the fullest extent permitted by law, be taken and
held to be valid personal service upon the Borrower.  Nothing in this Section shall affect the
right of the Lender to serve process in any manner otherwise permitted by law
or limit the right of the Lender otherwise to bring proceedings against any
Borrower in the courts of any jurisdiction or jurisdictions.

 

19.                                 No Novation.

 

This Note amends and restates, is intended as a
replacement of, and is in substitution for, that certain Second Amended and
Restated Revolving Credit Note dated as of July 3, 2008 (the “Original
Note”) from the Borrowers, as maker, payable to the order of the Lender, but is
not intended as a novation of the Original Note or any of the Obligations
evidenced by the Original Note.  All
references in the Financing Agreement or any of the other Financing Documents
to the Revolving Credit Note shall mean the Original Note, as amended and
restated in accordance with the provisions of this Note.

 

20.                                 Confessed Judgment.

 

UPON THE OCCURRENCE OF AN EVENT OF DEFAULT, EACH
BORROWER HEREBY AUTHORIZES ANY ATTORNEY DESIGNATED BY THE LENDER OR ANY CLERK
OF ANY COURT OF RECORD TO APPEAR FOR SUCH BORROWER IN ANY COURT OF RECORD AND
CONFESS JUDGMENT WITHOUT PRIOR HEARING AGAINST THE BORROWER IN FAVOR OF THE
LENDER FOR AND IN THE AMOUNT OF THE UNPAID PRINCIPAL SUM, ALL INTEREST ACCRUED
AND UNPAID THEREON, ALL OTHER AMOUNTS PAYABLE BY THE BORROWER TO THE LENDER
UNDER THE TERMS OF THIS NOTE OR ANY OF THE OTHER FINANCING DOCUMENTS, COSTS OF
SUIT, AND ATTORNEYS’ FEES OF FIFTEEN PERCENT (15%) OF THE UNPAID PRINCIPAL SUM
AND INTEREST THEN DUE HEREUNDER.  BY ITS
ACCEPTANCE OF THIS NOTE, THE LENDER AGREES THAT IN THE EVENT THE LENDER
EXERCISES AT ANY TIME ITS RIGHT TO CONFESS JUDGMENT UNDER THIS NOTE, THE LENDER
SHALL USE ITS BEST EFFORTS TO OBTAIN LEGAL COUNSEL WHO WILL CHARGE THE LENDER
FOR ITS SERVICES ON AN HOURLY BASIS, AT ITS CUSTOMARY HOURLY RATES AND ONLY FOR
THE TIME AND REASONABLE EXPENSES INCURRED. 
IN NO EVENT SHALL THE LENDER ENFORCE THE LEGAL FEES PORTION OF A
CONFESSED JUDGMENT AWARD FOR AN AMOUNT IN EXCESS OF THE FEES AND EXPENSES
ACTUALLY CHARGED TO THE LENDER FOR SERVICES RENDERED BY ITS COUNSEL IN
CONNECTION WITH SUCH CONFESSION OF JUDGMENT AND/OR THE COLLECTION OF SUMS OWED
TO THE LENDER.  IN THE EVENT THE LENDER
RECEIVES, THROUGH EXECUTION UPON A CONFESSED JUDGMENT, PAYMENTS ON ACCOUNT OF
ATTORNEYS’ FEES IN EXCESS OF SUCH ACTUAL ATTORNEYS’ FEES AND EXPENSES INCURRED
BY THE LENDER, THEN, AFTER FULL REPAYMENT AND SATISFACTION OF ALL OF THE
OBLIGATIONS UNDER AND IN CONNECTION WITH THIS NOTE, THE LOAN AGREEMENT AND ALL
OF THE OTHER LOAN DOCUMENTS, THE LENDER SHALL REFUND SUCH EXCESS AMOUNT TO THE
BORROWERS. EACH BORROWER HEREBY RELEASES, TO THE EXTENT PERMITTED BY APPLICABLE
LAW, ALL ERRORS AND ALL RIGHTS OF EXEMPTION, APPEAL, STAY OF EXECUTION, 

 

5

 

INQUISITION, AND OTHER
RIGHTS TO WHICH SUCH BORROWER MAY OTHERWISE BE ENTITLED UNDER THE LAWS OF
THE UNITED STATES OF AMERICA OR OF ANY STATE OR POSSESSION OF THE UNITED STATES
OF AMERICA NOW IN FORCE AND WHICH MAY HEREAFTER BE ENACTED.  THE AUTHORITY AND POWER TO APPEAR FOR AND
ENTER JUDGMENT AGAINST ANY BORROWER SHALL NOT BE EXHAUSTED BY ONE OR MORE
EXERCISES THEREOF OR BY ANY IMPERFECT EXERCISE THEREOF AND SHALL NOT BE
EXTINGUISHED BY ANY JUDGMENT ENTERED PURSUANT THERETO.  SUCH AUTHORITY MAY BE EXERCISED ON ONE
OR MORE OCCASIONS OR FROM TIME TO TIME IN THE SAME OR DIFFERENT JURISDICTIONS
AS OFTEN AS THE LENDER SHALL DEEM NECESSARY OR DESIRABLE, FOR ALL OF WHICH THIS
NOTE SHALL BE A SUFFICIENT WARRANT.

 

21.                                 WAIVER OF TRIAL BY JURY.

 

EACH BORROWER AND THE LENDER (BY ITS ACCEPTANCE
HEREOF) HEREBY WAIVE TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO WHICH SUCH
BORROWER AND THE LENDER MAY BE PARTIES, ARISING OUT OF OR IN ANY WAY
PERTAINING TO (A) THIS NOTE OR (B) THE FINANCING DOCUMENTS.  IT IS AGREED AND UNDERSTOOD THAT THIS WAIVER
CONSTITUTES A WAIVER OF TRIAL BY JURY OF ALL CLAIMS AGAINST ALL PARTIES TO SUCH
ACTIONS OR PROCEEDINGS, INCLUDING CLAIMS AGAINST PARTIES WHO ARE NOT PARTIES TO
THIS NOTE.

 

THIS WAIVER IS KNOWINGLY, WILLINGLY AND
VOLUNTARILY MADE BY EACH BORROWER, AND EACH BORROWER HEREBY REPRESENTS THAT NO
REPRESENTATIONS OF FACT OR OPINION HAVE BEEN MADE BY ANY INDIVIDUAL TO INDUCE
THIS WAIVER OF TRIAL BY JURY OR TO IN ANY WAY MODIFY OR NULLIFY ITS
EFFECT.  EACH BORROWER FURTHER REPRESENTS
THAT IT HAS BEEN REPRESENTED IN THE SIGNING OF THIS NOTE AND IN THE MAKING OF
THIS WAIVER BY INDEPENDENT LEGAL COUNSEL, SELECTED OF ITS OWN FREE WILL, AND
THAT IT HAS HAD THE OPPORTUNITY TO DISCUSS THIS WAIVER WITH COUNSEL.

 

[Signatures Follow on
Next Page]

 

6

 

SIGNATURE PAGE TO
THIRD AMENDED AND RESTATED 

REVOLVING CREDIT NOTE

 

IN WITNESS WHEREOF, each
Borrower has caused this Note to be executed under seal by its duly authorized
representatives as of the date first written above.

 

	
  WITNESS OR ATTEST:

  	
   

  	
  BORROWERS:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  TVI CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Sherri
  Voelkel

  	
   

  	
  By:

  	
  /s/ Harley A.
  Hughes

  	
   (Seal)

  
	
   

  	
   

  	
   

  	
  Harley A.
  Hughes,

  
	
   

  	
   

  	
   

  	
  President and
  Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  CAPA MANUFACTURING CORP.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Sherri
  Voelkel

  	
   

  	
  By:

  	
  /s/ Harley A.
  Hughes

  	
   (Seal)

  
	
   

  	
   

  	
   

  	
  Harley A.
  Hughes,

  
	
   

  	
   

  	
   

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  SAFETY TECH INTERNATIONAL, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Sherri
  Voelkel

  	
   

  	
  By:

  	
  /s/ Harley A.
  Hughes

  	
   (Seal)

  
	
   

  	
   

  	
   

  	
  Harley A.
  Hughes,

  
	
   

  	
   

  	
   

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  SIGNATURE SPECIAL EVENT SERVICES, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Sherri
  Voelkel

  	
   

  	
  By:

  	
  /s/ Harley A.
  Hughes

  	
   (Seal)

  
	
   

  	
   

  	
   

  	
  Harley A.
  Hughes,

  
	
   

  	
   

  	
   

  	
  President

  

 

7Exhibit 10.3

 

SECOND AMENDED AND
RESTATED TERM NOTE

 

	
  $17,103,291.61

  	
   

  	
  Baltimore, Maryland

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  April     ,
  2009

  

 

FOR VALUE RECEIVED, TVI CORPORATION, a Maryland
corporation (“TVI”), CAPA MANUFACTURING CORP., a Maryland corporation (“CAPA”),
SAFETY TECH INTERNATIONAL, INC., a Maryland corporation (“Safety Tech”) and
SIGNATURE SPECIAL EVENT SERVICES, INC., a Maryland corporation, formerly named “TVI
Holdings One, Inc.” (“Signature TVI”), jointly and severally (each of TVI,
CAPA, Safety Tech and Signature TVI, a “Borrower”; TVI, CAPA, Safety Tech and
Signature TVI, collectively, the “Borrowers”), promise to pay to the order of BRANCH BANKING
AND TRUST COMPANY, a
North Carolina banking corporation (the “Lender”), the principal sum of
SEVENTEEN MILLION ONE HUNDRED THREE THOUSAND TWO HUNDRED NINETY-ONE DOLLARS AND
SIXTY-ONE CENTS ($17,103,291.61) (the “Principal Sum”), together with interest
thereon at the rate or rates hereinafter provided, in accordance with the
following:

 

1.                                       Interest.

 

Commencing as of the date hereof and continuing until
repayment in full of all sums due hereunder, the unpaid Principal Sum shall
bear interest in accordance with Section 2.5 (Interest and Certain Fee
Provisions) of the Financing Agreement (as defined hereinafter).

 

2.                                       Payments and Maturity.

 

The unpaid Principal Sum, together with interest
thereon at the rate or rates provided above, shall be payable as follows:

 

(a)                                  Interest on the unpaid Principal Sum
shall be due and payable in accordance with Section 2.5.3 (Payment of
Interest) of the Financing Agreement;

 

(b)                                 Principal payments on the outstanding
Principal Sum shall be due and payable in accordance with Section 2.2.3
(Term Loan Payments);

 

(c)                                  Notwithstanding anything contained herein
to the contrary, the Borrowers shall pay to the Lender the Term Loan Mandatory
Prepayments set forth in Section 2.2.4 (Mandatory Prepayments of the Term
Loan) of the Financing Agreement; and

 

(d)                                 Unless sooner paid, the unpaid Principal
Sum, together with interest accrued and unpaid thereon, shall be due and
payable in full on the earlier of the Term Loan Maturity Date (as defined in
the Financing Agreement).

 

3.                                       Default Interest.

 

Upon the occurrence and during the continuance of an
Event of Default (as hereinafter defined), the unpaid Principal Sum shall bear
interest thereafter at the Post-Default Rate (as defined in the Financing
Agreement) until such Event of Default is cured.

 

1

 

4.                                       Late Charges.

 

If the Borrowers shall fail to make any payment under
the terms of this Note within ten (10) days after the date such payment is
due, the Borrowers shall pay to the Lender on demand a late charge equal to
five percent (5%) of such payment.

 

5.                                       Application and Place of Payments.

 

Unless otherwise set forth in the Financing Agreement,
all payments, made on account of this Note shall be applied in accordance with Section 2.2
(The Term Loan) of the Financing Agreement.

 

6.                                       Prepayment.

 

Without implying any limitation on the Borrowers’
obligation to pay the Early Termination Fee as and when provided in Section 2.5.2
(Early Termination Fee) of the Financing Agreement, the Borrowers may prepay
the Principal Sum in whole or in part at any time without premium or penalty.

 

7.                                       Financing Agreement and Other Financing
Documents.

 

This Note is the “Term Note” described in an Amended
and Restated Financing and Security Agreement dated as of February 22,
2008 by and among the Borrowers and the Lender (as amended by (a) that
certain First Amendment to Amended and Restated Financing and Security
Agreement dated as of July 3, 2008, (b) that certain Limited
Forbearance Agreement dated as of November 20, 3008, (c) that certain
Acknowledgment and Agreement dated as of January 30, 2009, (d) that
certain Agreement for Post-Petition Financing dated as of even date herewith and (e) as otherwise amended,
modified, restated, substituted, extended and renewed at any time and from time
to time, the “Financing Agreement”).  The
indebtedness evidenced by this Note is included within the meaning of the term “Obligations”
as defined in the Financing Agreement. 
This Note is one of the “Financing Documents” (as that term is defined
in the Financing Agreement).

 

8.                                       Security.

 

This Note is secured as provided in the Financing
Agreement.

 

9.                                       Events of Default.

 

The occurrence of any one or more of the following
events shall constitute an event of default (individually, an “Event of Default”
and collectively, the “Events of Default”) under the terms of this Note:

 

(a)                                  The failure of the Borrowers to pay to
the Lender when due any and all amounts payable by the Borrowers to the Lender
under the terms of this Note; or

 

(b)                                 The occurrence of an event of default (as
defined therein) under the terms and conditions of any of the other Financing
Documents.

 

2

 

10.                                 Remedies.

 

Upon the occurrence and during the continuance of an
Event of Default, at the option of the Lender, all amounts payable by the
Borrowers to the Lender under the terms of this Note shall immediately become
due and payable by the Borrowers to the Lender without notice to the Borrowers
or any other person, and the Lender shall have all of the rights, powers, and
remedies available under the terms of this Note, any of the other Financing Documents
and all applicable laws.  The Borrowers
and all endorsers, guarantors, and other parties who may now or in the future
be primarily or secondarily liable for the payment of the indebtedness
evidenced by this Note hereby severally waive presentment, protest and demand,
notice of protest, notice of demand and of dishonor and non-payment of this
Note and expressly agree that this Note or any payment hereunder may be
extended from time to time without in any way affecting the liability of the
Borrowers, guarantors and endorsers.

 

11.                                 Expenses.

 

The Borrowers promise to pay to the Lender on demand
by the Lender all costs and expenses incurred by the Lender in connection with
the collection and enforcement of this Note, including, without limitation,
reasonable attorneys’ fees and expenses and all court costs.

 

12.                                 Notices.

 

Any notice, request, or demand to or upon the
Borrowers or the Lender shall be deemed to have been properly given or made
when delivered in accordance with Section 8.1 (Notices) of the Financing
Agreement.

 

13.                                 Miscellaneous.

 

Each right, power, and remedy of the Lender as
provided for in this Note or any of the other Financing Documents, or now or
hereafter existing under any applicable law or otherwise shall be cumulative
and concurrent and shall be in addition to every other right, power, or remedy
provided for in this Note or any of the other Financing Documents or now or
hereafter existing under any applicable law, and the exercise or beginning of
the exercise by the Lender of any one or more of such rights, powers, or
remedies shall not preclude the simultaneous or later exercise by the Lender of
any or all such other rights, powers, or remedies.  No failure or delay by the Lender to insist
upon the strict performance of any term, condition, covenant, or agreement of
this Note or any of the other Financing Documents, or to exercise any right,
power, or remedy consequent upon a breach thereof, shall constitute a waiver of
any such term, condition, covenant, or agreement or of any such breach, or
preclude the Lender from exercising any such right, power, or remedy at a later
time or times.  By accepting payment
after the due date of any amount payable under the terms of this Note, the
Lender shall not be deemed to waive the right either to require prompt payment
when due of all other amounts payable under the terms of this Note or to
declare an Event of Default for the failure to effect such prompt payment of
any such other amount.  No course of
dealing or conduct shall be effective to amend, modify, waive, release, or
change any provisions of this Note.

 

3

 

14.                                 Partial  Invalidity.

 

In the event any provision of this Note (or any part
of any provision) is held by a court of competent jurisdiction to be invalid,
illegal, or unenforceable in any respect, such invalidity, illegality, or
unenforceability shall not affect any other provision (or remaining part of the
affected provision) of this Note; but this Note shall be construed as if such
invalid, illegal, or unenforceable provision (or part thereof) had not been
contained in this Note, but only to the extent it is invalid, illegal, or
unenforceable.

 

15.                                 Captions.

 

The captions herein set forth are for convenience only
and shall not be deemed to define, limit, or describe the scope or intent of
this Note.

 

16.                                 Applicable  Law.

 

The Borrowers acknowledge and agree that this Note
shall be governed by the laws of the State of Maryland, even though for the
convenience and at the request of the Borrowers, this Note may be executed
elsewhere, and solely to the extent applicable, the Bankruptcy Code (as defined
in the Financing Agreement).

 

17.                                 Consent to Jurisdiction.

 

Each Borrower irrevocably submits to the jurisdiction
of the Bankruptcy Court (as defined in the Financing Agreement) any state or
federal court sitting in the State of Maryland over any suit, action, or
proceeding arising out of or relating to this Note or any of the other
Financing Documents.  Each Borrower
irrevocably waives, to the fullest extent permitted by law, any objection that
such Borrower may now or hereafter have to the laying of venue of any such
suit, action, or proceeding brought in any such court and any claim that any
such suit, action, or proceeding brought in any such court has been brought in
an inconvenient forum.  Final judgment in
any such suit, action, or proceeding brought in any such court shall be
conclusive and binding upon each Borrower and may be enforced in any court in
which any Borrower is subject to jurisdiction by a suit upon such judgment,
provided that service of process is effected upon the Borrower as provided in
this Note or as otherwise permitted by applicable law.

 

18.                                 Service of Process.

 

Each Borrower hereby consents to process being served
in any suit, action, or proceeding instituted in connection with this Note by (a) the
mailing of a copy thereof by certified mail, postage prepaid, return receipt
requested, to the Borrowers and (b) serving a copy thereof upon the
registered agent for TVI as set forth in the records of the Maryland State
Department of Assessments and Taxation, the agent hereby designated and
appointed by each of the Borrowers as each Borrower’s agent for service of
process.  Each Borrower irrevocably
agrees that such service shall be deemed in every respect effective service of
process upon the Borrower in any such suit, action or proceeding, and shall, to
the fullest extent permitted by law, be taken and held to be valid personal
service upon the Borrower.  Nothing in
this Section shall affect the right of the Lender to serve process in any
manner otherwise permitted by law or limit the right of the 

 

4

 

Lender otherwise to bring
proceedings against any Borrower in the courts of any jurisdiction or
jurisdictions.

 

19.                                 No Novation.

 

This Note amends and restates, is intended as a
replacement of, and is in substitution for, that certain Amended and Restated
Term Note dated as of February 22, 2008 (the “Original Note”) from the
Borrowers, as maker, payable to the order of the Lender, but is not intended as
a novation of the Original Note or any of the Obligations evidenced by the
Original Note.  All references in the
Financing Agreement or any of the other Financing Documents to the Term Note
shall mean the Original Note, as amended and restated in accordance with the
provisions of this Note.

 

20.                                 Confessed Judgment.

 

UPON THE OCCURRENCE OF AN EVENT OF DEFAULT, EACH
BORROWER HEREBY AUTHORIZES ANY ATTORNEY DESIGNATED BY THE LENDER OR ANY CLERK
OF ANY COURT OF RECORD TO APPEAR FOR SUCH BORROWER IN ANY COURT OF RECORD AND
CONFESS JUDGMENT WITHOUT PRIOR HEARING AGAINST THE BORROWER IN FAVOR OF THE
LENDER FOR AND IN THE AMOUNT OF THE UNPAID PRINCIPAL SUM, ALL INTEREST ACCRUED
AND UNPAID THEREON, ALL OTHER AMOUNTS PAYABLE BY THE BORROWER TO THE LENDER
UNDER THE TERMS OF THIS NOTE OR ANY OF THE OTHER FINANCING DOCUMENTS, COSTS OF
SUIT, AND ATTORNEYS’ FEES OF FIFTEEN PERCENT (15%) OF THE UNPAID PRINCIPAL SUM
AND INTEREST THEN DUE HEREUNDER.  BY ITS
ACCEPTANCE OF THIS NOTE, THE LENDER AGREES THAT IN THE EVENT THE LENDER
EXERCISES AT ANY TIME ITS RIGHT TO CONFESS JUDGMENT UNDER THIS NOTE, THE LENDER
SHALL USE ITS BEST EFFORTS TO OBTAIN LEGAL COUNSEL WHO WILL CHARGE THE LENDER
FOR ITS SERVICES ON AN HOURLY BASIS, AT ITS CUSTOMARY HOURLY RATES AND ONLY FOR
THE TIME AND REASONABLE EXPENSES INCURRED. 
IN NO EVENT SHALL THE LENDER ENFORCE THE LEGAL FEES PORTION OF A
CONFESSED JUDGMENT AWARD FOR AN AMOUNT IN EXCESS OF THE FEES AND EXPENSES
ACTUALLY CHARGED TO THE LENDER FOR SERVICES RENDERED BY ITS COUNSEL IN
CONNECTION WITH SUCH CONFESSION OF JUDGMENT AND/OR THE COLLECTION OF SUMS OWED
TO THE LENDER.  IN THE EVENT THE LENDER
RECEIVES, THROUGH EXECUTION UPON A CONFESSED JUDGMENT, PAYMENTS ON ACCOUNT OF
ATTORNEYS’ FEES IN EXCESS OF SUCH ACTUAL ATTORNEYS’ FEES AND EXPENSES INCURRED
BY THE LENDER, THEN, AFTER FULL REPAYMENT AND SATISFACTION OF ALL OF THE
OBLIGATIONS UNDER AND IN CONNECTION WITH THIS NOTE, THE LOAN AGREEMENT AND ALL
OF THE OTHER LOAN DOCUMENTS, THE LENDER SHALL REFUND SUCH EXCESS AMOUNT TO THE
BORROWERS. EACH BORROWER HEREBY RELEASES, TO THE EXTENT PERMITTED BY APPLICABLE
LAW, ALL ERRORS AND ALL RIGHTS OF EXEMPTION, APPEAL, STAY OF EXECUTION,
INQUISITION, AND OTHER RIGHTS TO WHICH SUCH BORROWER MAY OTHERWISE BE
ENTITLED UNDER THE LAWS OF THE UNITED STATES OF AMERICA OR OF ANY STATE OR
POSSESSION OF THE UNITED STATES OF AMERICA NOW IN FORCE AND 

 

5

 

WHICH MAY HEREAFTER
BE ENACTED.  THE AUTHORITY AND POWER TO
APPEAR FOR AND ENTER JUDGMENT AGAINST ANY BORROWER SHALL NOT BE EXHAUSTED BY
ONE OR MORE EXERCISES THEREOF OR BY ANY IMPERFECT EXERCISE THEREOF AND SHALL
NOT BE EXTINGUISHED BY ANY JUDGMENT ENTERED PURSUANT THERETO.  SUCH AUTHORITY MAY BE EXERCISED ON ONE
OR MORE OCCASIONS OR FROM TIME TO TIME IN THE SAME OR DIFFERENT JURISDICTIONS
AS OFTEN AS THE LENDER SHALL DEEM NECESSARY OR DESIRABLE, FOR ALL OF WHICH THIS
NOTE SHALL BE A SUFFICIENT WARRANT.

 

21.                                 WAIVER OF TRIAL BY JURY.

 

EACH BORROWER AND THE LENDER (BY ITS ACCEPTANCE
HEREOF) HEREBY WAIVE TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO WHICH SUCH
BORROWER AND THE LENDER MAY BE PARTIES, ARISING OUT OF OR IN ANY WAY
PERTAINING TO (A) THIS NOTE OR (B) THE FINANCING DOCUMENTS.  IT IS AGREED AND UNDERSTOOD THAT THIS WAIVER
CONSTITUTES A WAIVER OF TRIAL BY JURY OF ALL CLAIMS AGAINST ALL PARTIES TO SUCH
ACTIONS OR PROCEEDINGS, INCLUDING CLAIMS AGAINST PARTIES WHO ARE NOT PARTIES TO
THIS NOTE.

 

THIS WAIVER IS KNOWINGLY, WILLINGLY AND
VOLUNTARILY MADE BY EACH BORROWER, AND EACH BORROWER HEREBY REPRESENTS THAT NO
REPRESENTATIONS OF FACT OR OPINION HAVE BEEN MADE BY ANY INDIVIDUAL TO INDUCE
THIS WAIVER OF TRIAL BY JURY OR TO IN ANY WAY MODIFY OR NULLIFY ITS
EFFECT.  EACH BORROWER FURTHER REPRESENTS
THAT IT HAS BEEN REPRESENTED IN THE SIGNING OF THIS NOTE AND IN THE MAKING OF
THIS WAIVER BY INDEPENDENT LEGAL COUNSEL, SELECTED OF ITS OWN FREE WILL, AND
THAT IT HAS HAD THE OPPORTUNITY TO DISCUSS THIS WAIVER WITH COUNSEL.

 

[Signatures Follow on
Next Page]

 

6

 

SIGNATURE PAGE TO SECOND
AMENDED AND RESTATED TERM NOTE

 

IN WITNESS WHEREOF, each
Borrower has caused this Note to be executed under seal by its duly authorized
representatives as of the date first written above.

 

	
  WITNESS OR
  ATTEST:

  	
   

  	
  BORROWERS:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  TVI CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Sherri
  Voelkel

  	
   

  	
  By:

  	
  /s/ Harley A.
  Hughes

  	
   (Seal)

  
	
   

  	
   

  	
   

  	
  Harley A.
  Hughes,

  
	
   

  	
   

  	
   

  	
  President and
  Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  CAPA
  MANUFACTURING CORP.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Sherri
  Voelkel

  	
   

  	
  By:

  	
  /s/ Harley A.
  Hughes

  	
   (Seal)

  
	
   

  	
   

  	
   

  	
  Harley A.
  Hughes,

  
	
   

  	
   

  	
   

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  SAFETY TECH
  INTERNATIONAL, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Sherri
  Voelkel

  	
   

  	
  By:

  	
  /s/ Harley A.
  Hughes

  	
   (Seal)

  
	
   

  	
   

  	
   

  	
  Harley A.
  Hughes,

  
	
   

  	
   

  	
   

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  SIGNATURE
  SPECIAL EVENT SERVICES, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Sherri Voelkel

  	
   

  	
  By:

  	
  /s/ Harley A.
  Hughes

  	
   (Seal)

  
	
   

  	
   

  	
   

  	
  Harley A.
  Hughes,

  
	
   

  	
   

  	
   

  	
  President

  

 

7

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