Document:

LOAN
AGREEMENT

     

    by and
among

     

    OAK
TREE EDUCATIONAL PARTNERS, INC.

     

    AND
ITS SUBSIDIARIES

     

    Borrowers

     

    and

     

    DEERPATH
FUNDING, LP

     

    as
Agent

     

    and

     

    THE
LENDERS FROM TIME TO TIME PARTY HERETO

     

    as
Lenders

     

    As
of November 30, 2010

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    TABLE
OF CONTENTS

     

    
      
        
          
            
              	
                      Section
      1

                    	
                      Definitions
      and Terms

                    	
                      7

                    
	
                      1.1

                    	
                      Definitions

                    	
                      7

                    
	
                      1.2

                    	
                      Other
      Interpretive Provisions

                    	
                      26

                    
	
                      1.3

                    	
                      Accounting
      Principles

                    	
                      27

                    
	
                      1.4

                    	
                      Time

                    	
                      27

                    
	 
      	 
      	 
      
	
                      Section
      2

                    	
                      Loan
      Commitments

                    	
                      27

                    
	
                      2.1

                    	
                      Initial
      Term Loan

                    	
                      27

                    
	
                      2.2

                    	
                      Additional
      Term Loans

                    	
                      28

                    
	
                      2.3

                    	
                      Loan
      Procedure

                    	
                      28

                    
	
                      2.4

                    	
                      Permitted
      Prepayment

                    	
                      28

                    
	
                      2.5

                    	
                      Mandatory
      Prepayment

                    	
                      29

                    
	
                      2.6

                    	
                      Joint
      and Several Obligations

                    	
                      30

                    
	
                      2.7

                    	
                      Issuance
      of Deerpath Shares and Deerpath Warrant; Post-Closing
    True-Up

                    	
                      31

                    
	 
      	 
      	 
      
	
                      Section
      3

                    	
                      Terms
      Of Payment

                    	
                      34

                    
	
                      3.1

                    	
                      Notes
      and Payments Generally

                    	
                      34

                    
	
                      3.2

                    	
                      Loan
      Payments

                    	
                      35

                    
	
                      3.3

                    	
                      Order
      of Application

                    	
                      35

                    
	
                      3.4

                    	
                      Interest
      Rate

                    	
                      36

                    
	
                      3.5

                    	
                      Default
      Rate

                    	
                      36

                    
	
                      3.6

                    	
                      Interest
      Calculations

                    	
                      36

                    
	
                      3.7

                    	
                      Maximum
      Rate

                    	
                      36

                    
	
                      3.8

                    	
                      Cost
      of Money Ceiling

                    	
                      37

                    
	 
      	 
      	 
      
	
                      Section
      4

                    	
                      Fees
      and Expenses

                    	
                      37

                    
	
                      4.1

                    	
                      Treatment
      of Fees and Expenses

                    	
                      37

                    
	
                      4.2

                    	
                      Structuring
      and Closing Fees

                    	
                      37

                    
	 
      	 
      	 
      
	
                      Section
      5

                    	
                      Conditions
      Precedent

                    	
                      38

                    
	
                      5.1

                    	
                      To
      Closing

                    	
                      38

                    
	
                      5.2

                    	
                      To
      Initial Term Loan

                    	
                      38

                    
	
                      5.3

                    	
                      To
      Additional Term Loans

                    	
                      40

                    
	
                      5.4

                    	
                      No
      Waiver

                    	
                      41

                    
	
                      5.5

                    	
                      Borrowers’
      Conditions

                    	
                      41

                    
	 
      	 
      	 
      
	
                      Section
      6

                    	
                      Security

                    	
                      42

                    
	
                      6.1

                    	
                      Collateral;
      After-Acquired Property

                    	
                      42

                    
	
                      6.2

                    	
                      Financing
      Statements

                    	
                      43

                    
	
                      6.3

                    	
                      Priority

                    	
                      43

                    
	 
      	 
      	 
      
	
                      Section
      7

                    	
                      Representations
      And Warranties

                    	
                      43

                    
	
                      7.1

                    	
                      Existence,
      Good Standing, and Authority to do Business

                    	
                      43

                    
	
                      7.2

                    	
                      Subsidiaries

                    	
                      44

                    
	
                      7.3

                    	
                      Authorization,
      Compliance, and No Default

                    	
                      44

                    
	
                      7.4

                    	
                      Binding
      Effect

                    	
                      44

                    
	
                      7.5

                    	
                      Litigation.

                    	
                      44

                    

            

          

        

      

    

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    

    
      
        
          	
                  7.6

                	
                  Taxes

                	
                  44

                
	
                  7.7

                	
                  Environmental
      Matters

                	
                  45

                
	
                  7.8

                	
                  Ownership
      of Assets; Intellectual Property

                	
                  45

                
	
                  7.9

                	
                  Liens

                	
                  45

                
	
                  7.10

                	
                  Debt

                	
                  45

                
	
                  7.11

                	
                  Insurance

                	
                  46

                
	
                  7.12

                	
                  Full
      Disclosure

                	
                  46

                
	
                  7.13

                	
                  Place
      of Business

                	
                  46

                
	
                  7.14

                	
                  Use
      of Proceeds

                	
                  46

                
	
                  7.15

                	
                  Employee
      Benefits

                	
                  47

                
	
                  7.16

                	
                  Laws
      Relating to Employment

                	
                  47

                
	
                  7.17

                	
                  Trade
      Names

                	
                  48

                
	
                  7.18

                	
                  Transactions
      with Affiliates

                	
                  48

                
	
                  7.19

                	
                  Government
      Regulation

                	
                  49

                
	
                  7.20

                	
                  Capitalization

                	
                  50

                
	
                  7.21

                	
                  Compliance
      with Laws; Certain Operations

                	
                  50

                
	
                  7.22

                	
                  Solvency

                	
                  51

                
	
                  7.23

                	
                  Financials

                	
                  51

                
	
                  7.24

                	
                  Absence
      of Undisclosed Liabilities

                	
                  51

                
	
                  7.25

                	
                  Employee
      Matters

                	
                  52

                
	
                  7.26

                	
                  SEC
      Documents and Compliance

                	
                  52

                
	 
      	 
      	 
      
	
                  Section
      8

                	
                  Affirmative
      Covenants

                	
                  54

                
	
                  8.1

                	
                  Items
      to be Furnished

                	
                  54

                
	
                  8.2

                	
                  Books
      and Records

                	
                  57

                
	
                  8.3

                	
                  Inspections

                	
                  57

                
	
                  8.4

                	
                  Taxes

                	
                  57

                
	
                  8.5

                	
                  Payment
      of Obligations and Compliance with Contracts

                	
                  57

                
	
                  8.6

                	
                  Indemnification

                	
                  57

                
	
                  8.7

                	
                  Maintenance
      of Existence, Assets, and Business

                	
                  59

                
	
                  8.8

                	
                  Insurance

                	
                  59

                
	
                  8.9

                	
                  Further
      Assurances

                	
                  60

                
	
                  8.10

                	
                  Compliance
      with Laws

                	
                  61

                
	
                  8.11

                	
                  Expenses

                	
                  61

                
	
                  8.12

                	
                  Application
      of Insurance Proceeds, Eminent Domain, Proceeds and Conditions to
      Disbursement 

                	
                  62

                
	
                  8.13

                	
                  Use
      of Proceeds

                	
                  62

                
	
                  8.14

                	
                  Board
      of Directors

                	
                  62

                
	
                  8.15

                	
                  Special
      SBIC Covenants

                	
                  63

                
	 
      	 
      	 
      
	
                  Section
      9

                	
                  Negative
      Covenants

                	
                  64

                
	
                  9.1

                	
                  Debt

                	
                  64

                
	
                  9.2

                	
                  Liens

                	
                  65

                
	
                  9.3

                	
                  Compliance
      with Laws and Documents

                	
                  65

                
	
                  9.4

                	
                  Loans,
      Advances, and Investments

                	
                  65

                
	
                  9.5

                	
                  Distributions

                	
                  66

                
	
                  9.6

                	
                  Acquisitions,
      Mergers and Dissolutions

                	
                  66

                
	
                  9.7

                	
                  Assignment

                	
                  66

                

        

      

    

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    

    
      
        
          	
                  9.8

                	
                  Fiscal
      Year and Accounting Methods

                	
                  66

                
	
                  9.9

                	
                  Sale
      of Assets

                	
                  67

                
	
                  9.10

                	
                  New
      Businesses

                	
                  67

                
	
                  9.11

                	
                  Employee
      Plans

                	
                  67

                
	
                  9.12

                	
                  Transactions
      with Affiliates

                	
                  67

                
	
                  9.13

                	
                  Taxes

                	
                  67

                
	
                  9.14

                	
                  Prepayment
      of Debt; Subordinated Debt

                	
                  67

                
	
                  9.15

                	
                  Lease
      Obligations

                	
                  68

                
	
                  9.16

                	
                  Capital
      Expenditures

                	
                  68

                
	
                  9.17

                	
                  Available
      Cash

                	
                  68

                
	
                  9.18

                	
                  Amendments
      or Changes in Agreements

                	
                  68

                
	
                  9.19

                	
                  Allocation
      of Consideration

                	
                  68

                
	
                  9.20

                	
                  Compensation

                	
                  68

                
	
                  9.21

                	
                  Bank
      Accounts

                	
                  69

                
	
                  9.22

                	
                  Negative
      Pledge

                	
                  69

                
	 
      	 
      	 
      
	
                  Section
      10

                	
                  Financial
      Covenants

                	
                  69

                
	
                  10.1

                	
                  Minimum
      EBITDA

                	
                  69

                
	
                  10.2

                	
                  Senior
      Debt to EBITDA Ratio

                	
                  70

                
	
                  10.3

                	
                  Funded
      Debt to EBITDA Ratio

                	
                  70

                
	
                  10.4

                	
                  Fixed
      Charge Coverage Ratio

                	
                  70

                
	 
      	 
      	 
      
	
                  Section
      11

                	
                  Default

                	
                  71

                
	
                  11.1

                	
                  Payment
      of Obligations

                	
                  71

                
	
                  11.2

                	
                  Covenants

                	
                  71

                
	
                  11.3

                	
                  Debtor
      Relief

                	
                  71

                
	
                  11.4

                	
                  Judgments
      and Attachments

                	
                  71

                
	
                  11.5

                	
                  Misrepresentation

                	
                  71

                
	
                  11.6

                	
                  Default
      Under Other Agreements

                	
                  72

                
	
                  11.7

                	
                  Validity
      and Enforceability of Loan Documents

                	
                  72

                
	
                  11.8

                	
                  Change
      of Control, Change of Management or Control Event

                	
                  72

                
	
                  11.9

                	
                  Ownership
      of Other Borrowers

                	
                  72

                
	
                  11.10

                	
                  Subordination
      Agreements

                	
                  72

                
	
                  11.11

                	
                  Material
      Adverse Event

                	
                  72

                
	 
      	 
      	 
      
	
                  Section
      12

                	
                  Rights
      And Remedies

                	
                  72

                
	
                  12.1

                	
                  Remedies
      Upon Default

                	
                  72

                
	
                  12.2

                	
                  Borrower
      Waivers

                	
                  73

                
	
                  12.3

                	
                  Performance
      by Agent

                	
                  73

                
	
                  12.4

                	
                  Not
      in Control

                	
                  73

                
	
                  12.5

                	
                  Course
      of Dealing

                	
                  73

                
	
                  12.6

                	
                  Cumulative
      Rights

                	
                  73

                
	
                  12.7

                	
                  Application
      of Proceeds

                	
                  74

                
	
                  12.8

                	
                  Diminution
      in Value of Collateral

                	
                  74

                
	 
      	 
      	 
      
	
                  Section
      13

                	
                  Agent

                	
                  74

                
	
                  13.1

                	
                  Appointment
      and Authorization of Agent

                	
                  74

                
	
                  13.2

                	
                  Rights
      as a Lender

                	
                  74

                
	
                  13.3

                	
                  Exculpatory
      Provisions

                	
                  75

                

        

      

    

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    

    
      
        
          	
                  13.4

                	
                  Reliance
      by Agent

                	
                  75

                
	
                  13.5

                	
                  Delegation
      of Duties

                	
                  76

                
	
                  13.6

                	
                  Resignation;
      Removal of Agent

                	
                  76

                
	
                  13.7

                	
                  Non-Reliance
      on Agent and Other Lenders

                	
                  77

                
	
                  13.8

                	
                  No
      Other Duties, Etc

                	
                  77

                
	
                  13.9

                	
                  Agent
      May File Proofs of Claim

                	
                  77

                
	
                  13.10

                	
                  Collateral
      Matters

                	
                  77

                
	 
      	 
      	 
      
	
                  Section
      14

                	
                  Miscellaneous

                	
                  79

                
	
                  14.1

                	
                  Headings

                	
                  79

                
	
                  14.2

                	
                  Non-Business
      Days

                	
                  79

                
	
                  14.3

                	
                  Communications

                	
                  79

                
	
                  14.4

                	
                  Survival

                	
                  80

                
	
                  14.5

                	
                  Governing
      Law

                	
                  80

                
	
                  14.6

                	
                  Invalid
      Provisions

                	
                  80

                
	
                  14.7

                	
                  Multiple
      Counterparts

                	
                  80

                
	
                  14.8

                	
                  Amendments;
      Assignments and Participations

                	
                  81

                
	
                  14.9

                	
                  Term

                	
                  81

                
	
                  14.10

                	
                  Marshaling;
      Discharge Only Upon Payment in Full; Reinstatement in Certain
      Circumstances

                	
                  82

                
	
                  14.11

                	
                  Arbitration

                	
                  82

                
	
                  14.12

                	
                  No
      Implied Waivers; Cumulative Remedies; Writing Required

                	
                  82

                
	
                  14.13

                	
                  Electronic
      Submissions

                	
                  83

                
	
                  14.14

                	
                  Jury
      Waiver

                	
                  83

                
	
                  14.15

                	
                  Venue
      and Service of Process

                	
                  83

                
	
                  14.16

                	
                  Marketing
      and Disclosure Rights of Lenders

                	
                  84

                
	
                  14.17

                	
                  Managerial
      Assistance by Lenders

                	
                  84

                
	
                  14.18

                	
                  Entirety

                	
                  85

                

        

      

    

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

     

    EXHIBITS

     

    
      
        	
                EXHIBIT
      A

              	
                Deerpath
      Initial Term Note

              
	
                EXHIBIT
      B

              	
                Security
      Agreement

              
	
                EXHIBIT
      C

              	
                Pledge
      Agreement

              
	
                EXHIBIT
      D

              	
                Form
      of Deposit Account Control Agreement

              
	
                EXHIBIT
      E

              	
                Form
      of Landlord Subordination of Lien

              
	
                EXHIBIT
      F

              	
                Valley
      Note Subordination Agreement

              
	
                EXHIBIT
      G

              	
                Deerpath
      Warrant

              
	
                EXHIBIT
      H

              	
                Investor
      Rights Agreement

              
	
                EXHIBIT
      I

              	
                Noncompetition
      Letter Agreements

              
	
                EXHIBIT
      J

              	
                Small
      Business Side Letter

              
	
                EXHIBIT
      K

              	
                Flow
      of Funds Memo

              
	
                EXHIBIT
      L

              	
                Form
      of Loan Request

              
	
                EXHIBIT
      M

              	
                Form
      of Compliance Certificate

              
	
                EXHIBIT
      N

              	
                Form
      of Joinder Agreement

              
	
                EXHIBIT
      O

              	
                Culinary
      Group Note

              

      

    

    

    SCHEDULES

    

    
      
        	
                SCHEDULE
      1

              	
                Parties,
      Addresses, and Wiring Information

              
	
                SCHEDULE
      2

              	
                Culinary
      Group Pro-Forma Add-Back Adjustments

              
	
                SCHEDULE
      2.7

              	
                Calculation
      of Deerpath Shares and Deerpath Warrant

              
	
                SCHEDULE
      7.2

              	
                Subsidiaries

              
	
                SCHEDULE
      7.3

              	
                Amended
      Agreements

              
	
                SCHEDULE
      7.5(a)

              	
                Litigation

              
	
                SCHEDULE
      7.5(b)

              	
                Outstanding
      Judgments

              
	
                SCHEDULE
      7.6

              	
                Contested
      Taxes

              
	
                SCHEDULE
      7.7

              	
                Environmental
      Matters

              
	
                SCHEDULE
      7.8

              	
                Real
      Property

              
	
                SCHEDULE
      7.11

              	
                Insurance

              
	
                SCHEDULE
      7.13

              	
                Place
      of Business

              
	
                SCHEDULE
      7.15(a)

              	
                Employee
      Plans

              
	
                SCHEDULE
      7.16(a)

              	
                Complaints
      Relating to Employment

              
	
                SCHEDULE
      7.17

              	
                Trade
      Names

              
	
                SCHEDULE
      7.18(a)

              	
                Transactions
      With Affiliates

              
	
                SCHEDULE
      7.18(b)

              	
                Transactions
      With Affiliates Not At Arm’s Length

              
	
                SCHEDULE
      7.20(a)

              	
                Capitalization

              
	
                SCHEDULE
      7.20(b)

              	
                Planned
      Issuances; Voting and Transfer Rights

              
	
                SCHEDULE
      7.20(c)

              	
                Preemptive
      Rights and Registration Rights

              
	
                SCHEDULE
      7.23(a)

              	
                Financial
      Statements

              
	
                SCHEDULE
      7.23(b)

              	
                Financial
      Statements – Exceptions to GAAP

              
	
                SCHEDULE
      7.25

              	
                Employee
      Matters

              
	
                SCHEDULE
      9.21

              	
                Management
      Person Compensation
Schedule

              

      

    

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    LOAN
AGREEMENT

     

    THIS LOAN
AGREEMENT (this “Agreement”)
is entered into effective as of November 30, 2010 (the “Closing
Date”), by and among Oak
Tree Educational Partners, Inc., a Delaware corporation formerly known as
Florham Consulting Corp. (the “Company”),
each of the Company’s Subsidiaries, current and future (each, a “Subsidiary
Borrower” and collectively, the “Subsidiary
Borrowers”, and together with the Company, each, a “Borrower”
and collectively, “Borrowers”),
and Deerpath
Funding, LP, a Delaware limited partnership (“Deerpath”
and, together with any and all other Lenders from time to time party to this
Agreement, each a “Lender”,
and collectively, the “Lenders”),
and Deerpath, as administrative agent and collateral agent for itself and the
other Lenders (in such capacity, “Agent”).

     

    RECITALS

     

    A.   Borrowers
have requested Lenders to make a single advance senior secured term loan on or
about the Closing Date in the amount of $3,000,000.

     

    B.    Lenders
are willing to make the Term Loan to Borrowers subject to the terms and
conditions in this Agreement.

     

    Accordingly,
Borrowers, Agent and Lenders agree as follows:

     

    Section
1      Definitions
and Terms.

     

    1.1           Definitions.  As
used in the Loan Documents:

     

    AAA is
defined in Section
14.11.

     

    ACH Authorization
Agreements means those certain Authorization Agreements for
Pre-Authorized Payments (Debit) executed by the Company in favor of each
Lender.

     

    Accounting
Firm is defined in Section
8.1(a)(i).

     

    Additional Term
Loan and Additional Term
Loans are defined in Section
2.2.

     

    Additional Term
Loan Commitment means $7,000,000.

     

    Additional Term
Note means individually, and Additional Term
Notes means collectively, each promissory note executed by Borrowers and
made payable to any Lender, evidencing all or any portion of an Additional Term
Loan and otherwise in substantially the same form as the Deerpath Initial Term
Note.

     

    Affiliate
of a Person means any other Person that directly or indirectly controls, or is
controlled by, or is under common control with, that Person, and, with respect
to any Person that is a natural Person, such Person’s spouse and the siblings,
ascendants and descendants of such Person and his or her spouse.  For
purposes of this definition “control,” “controlled by,” and “under common control with”
mean possession, directly or indirectly, of power to direct (or cause the
direction of) management or policies of a Person, whether through ownership of
Voting Interests or other ownership interests, by contract, or otherwise; provided, however, that any
director, executive officer, manager or other Person which owns directly or
indirectly five percent (5%) or more of the securities of any other Person
having ordinary voting power for the election of directors or managers shall be
deemed to control such other Person.  Under no circumstances shall
Agent or any Lender be deemed to be an Affiliate of any Borrower or any
Borrower’s Affiliates.

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    Agent is
defined in the introductory paragraph of this Agreement, and includes any
successor Agent appointed pursuant to Section
13.6.

     

    Agreement
means this Loan Agreement, as amended, restated, supplemented or otherwise
modified from time to time.

     

    Annual Excess
Cash Flow Prepayment is defined in Section
2.5(b)(i).

     

    Approved
Electronic Form is defined in Section
14.13.

     

    Approved
Electronic Form Notice is defined in Section
14.13.

     

    Audit Opinion
is defined in Section
7.26(c).

     

    Bianco
means Joseph J. Bianco, a resident of New York, New York.

     

    Bianco Contingent
Options means the options to purchase an aggregate of 1,279,484 shares of
Oak Tree Common Stock issued to Bianco pursuant to that certain Stock Option
Agreement dated December 31, 2009, between the Company and Bianco (as amended,
the “Bianco
Option Agreement”), consisting of 639,742 “Tier I Options” and 639,742
“Tier II Options” and subject to certain conditions to exercisability as set
forth in the Bianco Option Agreement.

     

    Beneficial
Ownership and Beneficial
Owner have the meanings given them in Rule 13d-3 under the
Securities Exchange Act of 1934, as in effect from time to time.

     

    Board of
Directors means, with respect to any Person (other than a natural
person), the board of directors, board of managers or similar governing body of
such Person.  The Board of Directors of a limited partnership shall be
the Board of Directors of its general partner.  The Board of Directors
of any limited liability company that is managed by its sole Equityholder shall
be the Board of Directors of such sole Equityholder.

     

    Borrower
and Borrowers
are defined in the introductory paragraph hereto.

     

    Business
means the ownership and operation by the Company and each of its
Subsidiaries, including any existing or future Subsidiary, of academic and
vocational training and related schools and academies, including those licensed
by the department of education or related agencies of any state or
municipality.

     

    Business
Day means any day which is not a Saturday, Sunday, or other day on which
commercial banks in New York, New York are authorized or obligated to
close.

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    Capital
Expenditures means, without duplication, the
following:  (a) the aggregate amount of Borrowers’ expenditures
for fixed or capital assets determined in accordance with GAAP (including
replacements, capitalized repairs and improvements but excluding any Insurance
Proceeds or Eminent Domain Proceeds used to replace fixed assets in accordance
with Section
8.12, following a casualty event or condemnation with respect thereto),
plus (b) to the
extent not included in clause
(a), the aggregate principal portion of all of Borrowers’ payments under
any Capital Lease required to be capitalized in accordance with GAAP (excluding
the portion thereof allocable to interest expense).

     

    Capital
Lease means any lease (or sublease or other similar arrangement conveying
the right to use) of property, real or personal, which is required to be
classified and accounted for as a liability for a capital lease on a balance
sheet of such Person under GAAP, and the amount of such lease shall be the
capitalized amount thereof determined in accordance with GAAP.

     

    Cash
Distributions means a Distribution made in cash.

     

    Cash
Equivalents means (i) United States dollars, (ii) securities issued or
directly and fully guaranteed or insured by the United States government or any
agency or instrumentality thereof having maturities of less than one year from
the date of acquisition, (iii) certificates of deposit and Eurodollar time
deposits with maturities of less than one year from the date of acquisition,
bankers’ acceptances with maturities of less than one year and overnight bank
deposits, in each case with any domestic commercial bank having capital and
surplus in excess of $100,000,000, (iv) repurchase obligations with a term of
not more than seven days for underlying securities of the types described in
clauses (ii) and (iii) entered into with any financial institution meeting the
qualifications specified in clause (iii) immediately above, (v) commercial paper
having the highest rating obtainable from Moody’s or Standard & Poor’s
Ratings Services and in each case maturing within nine months after the date of
acquisition and (vi) interests in money market mutual funds which invest solely
in assets and securities of the type described in clauses (i) through (v)
immediately above.

     

    Change of
Control means, without the prior written consent of Agent, the occurrence
of any of the following, in a single transaction or any series of
transactions:  (a) the sale, transfer, conveyance, lease or other
disposition (other than by way of merger or consolidation) to any Person (other
than a Borrower) of all or substantially all of the assets of any Borrower;
(b) the adoption of a plan relating to the dissolution, liquidation or
winding-up of any Borrower; (c) the consummation of any sale, issuance,
exchange, exercise or conversion of Equity Securities of any Borrower other than
the Company, or any merger, consolidation, recapitalization, reorganization or
other transaction involving any Borrower other than the Company, which results
in the Company owning, directly or indirectly, less than fifty-one
percent (51%) of the Voting Interests of such Borrower (or the Voting
Interests of the surviving or resulting company of such merger, consolidation or
other transaction, if such Borrower is not the surviving or resulting company),
or (d) the consummation of any sale, issuance, exchange, exercise or
conversion of Equity Securities of the Company, or any merger, consolidation,
recapitalization, reorganization or similar transaction involving the Company,
which results in (i) Controlling Shareholders owning less than fifty-one
percent (51%) of the Voting Interests of the Company (or the Voting
Interests of the surviving or resulting company of such merger, consolidation or
other transaction, if the Company is not the surviving or resulting company) or
(ii) any Person other than Controlling Shareholders having the power to elect a
majority of the members of the Board of Directors of the Company; provided,
however, that a “Change of Control” shall not be
deemed to have occurred if any one Borrower is merged or consolidated with
another Borrower or all of the assets, subject to all liabilities of any one
Borrower are transferred to another Borrower.  For purposes of this
definition of “Change of Control”, (i) any transfer of at least fifty percent
(50%) of the Voting Interests of an entity that holds Voting Interests of any
Borrower will be deemed to be a transfer of such Voting Interests of such
Borrower, (ii) the definition of “Person” shall include two or more Persons
acting as a partnership, limited partnership, syndicate, joint venture,
co-investing or other group.

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

    Change of
Management means, without the prior written consent of Agent, the
occurrence of any of the following:  (a) both Bianco and Narang
(whether voluntarily or involuntarily or for any other reason) cease to be
employed as senior executive officers of the Borrowers, (b) both Bianco and
Narang (whether voluntarily or involuntarily or for any other reason) ceases to
devote substantially all of their business and professional time to the Business
of the Company, or (c) both Monaco and Kaplan cease (whether voluntarily or
involuntarily or for any other reason) to be full-time employees of the
Borrowers; provided, that
Borrowers shall have a period of 120 days after the occurrence of any of
the foregoing events to hire a replacement executive that is reasonably
acceptable to Lenders before such termination of employment constitutes a Change
of Management.

     

    Closing
means the closing of the Initial Term Loan and the Culinary Group
Acquisition.

     

    Closing
Date is defined in the introductory paragraph of this
Agreement.

     

    Collateral
is defined in Section 6.1(a).

     

    Commitment
Letter
means that certain conditional commitment letter dated June 15, 2010 (as
extended on July 30, 2010), addressed to the Company by Deerpath Capital
Management, LP, and accepted and agreed to by the Company.

     

    Company is
defined in the introductory paragraph hereto.

     

    Compliance
Certificate means a certificate substantially in the form of Exhibit M
signed by a Responsible Officer of the Company.

     

    Contingent Shares
is defined in Section
2.7(c).

     

    Control
Event means the execution of any written agreement binding on any of the
Borrowers, with respect to any proposed transaction or event or series of
transactions or events which, individually or in the aggregate, could reasonably
be expected to result in a Change of Control or a Change of Management, except
for any such agreement that, upon consummation of the transactions contemplated
thereby, would result in the full and complete payment of all
Obligations.

     

    Controlling
Shareholders means, collectively (a) Sanjo Squared, LLC, a Delaware
limited liability company (“Sanjo”),
acting through its managers, Bianco and Narang; (b) and Kinder Investments, L.P., a
Delaware limited partnership (“Kinder”),
acting through its general partner, Nesher, LLC and Dov Perlysky, the managing
member of Nesher, LLC..

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    Culinary Group
Acquisition means the purchase and acquisition by the Company of
substantially all of the assets and the ongoing business operations of the
Culinary Group Sellers pursuant to the terms set forth in the Culinary Group
Purchase Agreements or on such other terms as shall be acceptable to the
Agent.

     

    Culinary Group
Note means that certain subordinated unsecured promissory note dated the
Closing Date, executed by ETI and made payable to the ETI Shareholders in an
amount set forth therein, attached hereto as Exhibit
O.

     

    Culinary Group
Purchase Agreements means the collective reference to (a) that certain
Amended and Restated Membership Interest Purchase Agreement dated as of November
19, 2010 (the “Culinary Group
MIPA”), by and among the Company, as purchaser, the Culinary Group
Sellers, as sellers, and Monaco and Kaplan, as members, and (b) the Amended
and Restated Agreement and Plan of Merger dated as of November 19, 2010 (the
“Culinary
Group Merger Agreement”), by and among the Company, ETI Acquisition
Corp., ETI, Monaco, Kaplan and their respective spouses.

     

    Culinary Group
Sellers means, collectively, Culinary Tech Center, LLC, a New York
limited liability company, Professional Culinary Institute LLC, a New York
limited liability company, and ETI.

     

    Current
Financials means (a) until the first delivery of consolidated financial
statements of Borrowers pursuant to Section
8.1, the Financial Statements, and (b) after the first delivery of
consolidated financial statements of Borrowers under Section
8.1, the consolidated financial statements of the Borrowers most recently
delivered to Lenders under Section
8.1 as of the date of determination.

     

    Debt means
(without duplication), with respect to any Borrower, (a) all obligations
required by GAAP to be classified upon such Borrower’s balance sheet as
liabilities, (b) all obligations of such Borrower for borrowed money
(whether as a direct obligor on a promissory note, a reimbursement obligor on a
letter of credit, a guarantor, or otherwise), excluding the accounting impact of
any discount to the GAAP book value of the Debt instrument resulting from the
allocation of proceeds from such borrowed money between the Debt instrument and
concurrently issued equity interests granted by such Borrower, (c) liabilities
to the extent secured (or for which and to the extent the holder of the Debt has
an existing right, contingent or otherwise, to be so secured) by any Lien
existing on property owned or acquired by such Borrower, (d) Capital Leases and
other obligations of such Borrower that have been (or under GAAP should be)
capitalized for financial reporting purposes, and (e) all guaranties,
endorsements, and other contingent liabilities with respect to Debt or
obligations of others.  With respect to Borrowers, Debt means the
aggregate of the Debt of the Borrowers.

     

    Debtor Relief
Laws means Title 11 of
the United States Code and all other applicable liquidation,
conservatorship, bankruptcy, fraudulent transfer, moratorium, rearrangement,
receivership, insolvency, reorganization, suspension of payments, or similar
Laws in effect from time to time affecting the rights of creditors
generally.

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    Deed of
Trust means, with respect to any real property interest of any Borrower
(including but not limited to any fee simple, leasehold or mineral interest), a
mortgage, deed of trust or similar instrument in Proper Form executed by any
Borrower that grants Agent (for the ratable benefit of Lenders) a Lien on such
real property interest to secure the performance and payment in full of the
Obligations.

     

    Deerpath
is defined in the introductory paragraph hereto.

     

    Deerpath Initial
Term Note means that certain promissory note attached hereto as Exhibit A,
executed by Borrowers as of the Closing Date and made payable to Deerpath in an
original principal amount equal to the Initial Term Loan Commitment, or
$3,000,000.00, and all renewals, increases, modifications, amendments,
supplements, restatements and replacements of, or substitutions for, that
promissory note.

     

    Deerpath Shares
is defined in Section
2.7(a).

     

    Deerpath Warrant
is defined in Section
2.7(b).

     

    Default is
defined in
Section 11.

     

    Default
Rate is defined in Section
3.5.

     

    Deposit Account
Control Agreement means, with respect to each checking, savings or other
deposit account utilized by a Borrower, a Deposit Account Control Agreement by
and among such Borrower, Agent and the applicable depository bank, in
substantially the form of Exhibit D
(or otherwise in Proper Form as approved in advance by
Agent).

     

    Director
means any member of a Board of Directors of the Company.

     

    Distribution
for any Person means, (a) with respect to any Equity Securities of that Person,
(i) the declaration or payment of any dividend or distribution on or with
respect to such Equity Securities, (ii) the retirement, redemption, purchase,
withdrawal, or other acquisition for value of such Equity Securities (including
the purchase of warrants, rights, or other options to acquire such interests),
or (iii) any other payment by that Person with respect to such Equity
Securities, and (b) any loan or advance by that Person to, or other investment
by that Person in, the holder of any Equity Securities of that
Person.

     

    Dollar,
Dollars or $ mean
lawful money of the United States of America.

     

    EBITDA
means, without duplication, for any period, the Net Income of the Borrowers for
such period plus:

     

    (a)  GAAP
depreciation, amortization, Net Interest Expense and income taxes, plus

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

    (b)  the
sum of those non-recurring charges (i) incurred in connection with acquisition
and transaction expenses relating to the Culinary Group Acquisition, (ii) up to
$200,000 incurred and to be incurred in calendar year 2010 in connection with
costs of compliance with SEC reporting and filing obligations, (iii) incurred in
calendar year 2010 through the Closing, relating to pro-forma non-recurring
add-back adjustments to the pro-forma Net Income of the Culinary Group Sellers,
as set forth on Schedule 2
annexed hereto, (iii) incurred in connection with any Permitted
Acquisition, to the extent approved in writing by Agent, (iv) incurred in
connection with any financings of any Permitted Debt or the issuance of any
Equity Securities, to the extent approved in writing by Agent, (v) that are
recorded as non-recurring charges in accordance with GAAP, or (vi) those other
non-recurring charges as may, from time to time, be approved in writing by
Agent; plus

     

    (c)  any
non-cash charges that are (i) incurred in the ordinary course of the Business,
(ii) recorded as non-cash charges in accordance with GAAP, and (iii) if
contained in an unaudited consolidated statement of income, approved in writing
by Agent, minus

     

    (d)  any
non-cash income that is (i) incurred in the ordinary course of the Business,
(ii) recorded as non-cash income in accordance with GAAP, and (iii) if contained
in an unaudited consolidated statement of income, approved in writing by
Agent.

     

    Notwithstanding
the foregoing, EBITDA for any period shall:

     

    (i)           exclude
“EBITDA” on a pro forma basis for such period of each Person (or business unit,
division or group of such Person) which is sold, transferred or otherwise
disposed of by a Borrower during such period;

     

    (ii)          exclude
any proceeds collected from Key Man Life Insurance;

     

    (iii)         include
“EBITDA” on a pro forma basis for such period of each Person (or business unit,
division or group of such Person) that is acquired by a Borrower during such
period; provided that,
in respect of an acquisition, the pro forma information shall include the
historical financial results of the acquired Person on a pro forma trailing
twelve (12) month basis (consistent with SEC regulations), and shall assume that
the consummation of such acquisition (and the incurrence, refinancing, or
assumption of any Debt in connection with such acquisition) occurred on the
first day of the trailing twelve (12) month period.

     

    EII means
Educational Investors, Inc., a Delaware corporation.

     

    Electronic Form
is defined in Section
14.13.

     

    Eminent Domain
Event means any Governmental Authority or any Person acting under a
Governmental Authority institutes proceedings to condemn, seize or appropriate
all or part of any asset of a Borrower.

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

    Eminent Domain
Proceeds means all amounts received by any Borrower as a result of any
Eminent Domain Event.

     

    Employee
Plan means an “employee
pension benefit plan” (as defined in section 3(2) of ERISA) established,
maintained or contributed to by any Borrower.

     

    Environmental and
Safety Law means any Law that relates to public health and safety,
nuisance, worker health and safety, protection of the environment, pollution or
contamination or to standards of conduct and bases of obligations relating to
the presence, use, production, generation, handling, transport, treatment,
storage, disposal, sale, distribution, labeling, testing, processing, discharge,
release, threatened release, control or cleanup of any Hazardous
Substances.

     

    Environmental
Permits means (a) any statutory or regulatory exemption for which any
Borrower qualifies, or (b) any permit, license, confirmation letter, or variance
letter issued to or for the benefit of a Borrower (or under which a Borrower
operates) by the Environmental Protection Agency, the New York Department of
Environmental Protection, or any other Governmental Authority in connection with
or pursuant to any Environmental and Safety Law.

     

    Equity
Securities means, with respect to any Person (other than an individual),
all of such Person’s issued and outstanding:

     

    (e)  shares
of capital stock (including but not limited to common stock and preferred
stock), partnership interests, membership interests, equity interests, profits
interests, warrants, options or other rights for the purchase or acquisition
from such Person of shares of capital stock or other equity or profits interests
of such Person;

     

    (f)  all
of the securities convertible into or exchangeable for shares of capital stock,
equity or profits interests, warrants, rights or options for the purchase or
acquisition from such Person of such shares or interests; and

     

    (g)  all
of the other equity or profit interests in such Person, whether voting or
nonvoting, and whether or not such shares, warrants, options, rights or other
interests are outstanding on any date of determination.

     

    Equity Securities
of Borrowers means all of the Equity Securities of all of the Borrowers,
collectively.

     

    Equityholder
means each of, and Equityholders
means collectively, with respect to any Person or Persons (other than an
individual), the holders of Equity Securities of such Person or Persons,
respectively.

     

    ERISA
means the Employee Retirement
Income Security Act of 1974, as amended, and related rules and
regulations.

     

    ETI means
Educational Training Institute, Inc., a New York corporation.

     

    ETI Shareholders
means the shareholders of ETI immediately prior to the
Closing.

    
      
         

      

      
        14

        
          

        

      

      
         

      

    

    Excess Cash
Flow means, for any Excess Cash Flow Period, the sum, without
duplication, of:

     

    (h)  Borrowers’
EBITDA for such Excess Cash Flow Period, minus

     

    (i)  the
sum of:

     

    (i)           Borrowers’
Taxes that have been paid during such Excess Cash Flow Period;

     

    (ii)          the
principal amount of all Funded Debt paid by Borrowers during such Excess Cash
Flow Period;

     

    (iii)         Net
Interest Expense paid by Borrowers during such Excess Cash Flow Period;
and

     

    (iv)         Capital
Expenditures for such Excess Cash Flow Period, minus (or plus)

     

    (j)  any
increase (or decrease)
in Borrowers’ Net Working Capital for such Excess Cash Flow
Period,

     

    all as
calculated on an annual basis following completion of Borrowers’ certified
financial statements provided to Lenders pursuant to Section
8.1(a); provided, that
if the result of such calculation is a negative amount, then Excess Cash
Flow for such Excess Cash Flow Period shall be deemed equal to zero dollars
($0.00).

     

    Excess Cash Flow
Period shall mean (a) Borrowers’ fiscal year ending on December 31, 2011
(plus the period commencing on the Closing Date and ending December 31, 2010)
and (ii) each fiscal year of Borrowers thereafter.

     

    Exchange
Act means the Securities and Exchange Act of 1934, as
amended.

     

    Exhibit
means an exhibit attached to this Agreement unless otherwise
specified.

     

    Financial
Statements is defined in Section
7.23(a).

     

    Fixed Charge
Coverage Ratio means, when determined, the ratio of:

     

    (k)  EBITDA
for the most recently completed 12-month period, to

     

    (l)  the
sum of (collectively, the “Fixed
Charges”):

     

    (i)           the
principal amount of all Funded Debt scheduled to be paid over the next twelve
(12) month period;

     

    (ii)          Net
Interest Expense during the most recently completed twelve (12) month period;
and

     

    
      
         

      

      
        15

        
          

        

      

      
         

      

    

    (iii)         Capital
Expenditures, cash Taxes and any Cash Distributions for the most recently
completed twelve (12) month period.

     

    Flow of Funds
Memo means that certain disbursement of funds letter dated on or about
the Closing Date, attached hereto as Exhibit
K.

     

    Fully Diluted
Basis means, with respect to any Person, the assumption that all options,
warrants or other convertible securities or instruments or other rights to
acquire existing or future classes of Equity Securities of such Person have been
exercised or converted, as applicable, in full, regardless of whether any such
options, warrants, convertible securities or instruments or other rights are
then vested or exercisable or convertible in accordance with their
terms.

     

    Funded
Debt means, without duplication, when determined, the
following:  (a) all obligations of the Borrowers for borrowed
money (whether as a direct obligor on a promissory note, a reimbursement obligor
on a letter of credit, a guarantor, surety or other secondary obligor or
otherwise), including the Valley Note and the Culinary Group Note and excluding
the accounting impact of any discount to the GAAP book value of the Debt
instrument resulting from the allocation of proceeds from such borrowed money
between the Debt instrument and concurrently issued equity interests granted by
such Person, plus (but
without duplication) (b) all Capital Lease obligations of the
Borrowers.

     

    Funded Debt to
EBITDA Ratio means, when determined, the ratio of the Borrowers’
(a) Funded Debt to (b) EBITDA for the most recently completed 12-month
period.

     

    GAAP means
generally accepted accounting principles in the United States of America, as in
effect from time to time, set out 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 any nation or government, any state or other political
subdivision thereof, any agency, authority, instrumentality, regulatory body,
court, administrative tribunal, central bank or other entity exercising
executive, legislative, judicial, taxing, regulatory or administrative powers or
functions of or pertaining to government and includes a private mediation or
arbitration board or panel.

     

    Hazardous
Substance means (a) any substance the presence of which requires
removal, remediation or investigation under any applicable Environmental and
Safety Law, (b) any substance that is defined or classified as a hazardous
waste, hazardous material, pollutant, contaminant, or toxic or hazardous
substance under any applicable Environmental and Safety Law, or (c) petroleum,
petroleum products, oil, N.O.R.M. and other radioactive material, chlorides and
asbestos.

    
      
         

      

      
        16

        
          

        

      

      
         

      

    

    Immigration
Laws means and includes the Immigration Reform and Control Act of 1986
and any and all other federal, state, municipal or other Laws enforced or under
the jurisdiction of the U.S. Immigration and Customs Enforcement or otherwise
pertaining to or relating to foreign nationals who come to the United States
either temporarily or permanently, including (a) the associated legal
rights, duties and obligations of aliens and their employers in the United
States, (b) employer verification obligations and procedures involved with the
employment of foreign nationals, (c) application processes and procedures
involved with naturalization of foreign nationals who wish to become United
States citizens, and (d) legal issues relating to people who cross U.S. borders
by means of fraud or other illegal means, and those who traffic or otherwise
illegally transport aliens into the United States, together with any and all
regulations promulgated thereunder.

     

    Independent
Accounting Firm means either Raich Ende Malter & Co. LLP or Steven F.
Landau, CPA.

     

    Initial Term Loan
is defined in Section
2.1.

     

    Initial Term Loan
Commitment means $3,000,000.

     

    Insurance
Proceeds means all cash and non-cash proceeds in respect of any insurance
policy maintained by any Borrower, including (a)proceeds relating to Collateral,
(b) any Key Man Life Insurance proceeds, and (c)any business interruption
insurance proceeds.

     

    Interest
means cash interest expense paid or accrued in respect of Debt and shall not
include non-cash interest charges or expense resulting from the issuance of
Equity Securities or related financing transactions.

     

    Investor Rights
Agreement means that certain Investor Rights Agreement dated the Closing
Date, by and among the Company, Deerpath and the shareholders of the Company
named therein, attached hereto as Exhibit H,
as amended.

     

    Joinder
Agreement is defined in Section
8.9.

     

    Kaplan
means Harold Kaplan, a resident of the State of New York.

     

    Key Man Life
Insurance means (a) the insurance policy(ies) maintained by Borrowers on
the lives of Bianco, Narang, Monaco and Kaplan, payable to Borrowers in an
aggregate amount at all times at least equal to the Principal Debt, and
(b) any other policy of key man life insurance maintained by Borrowers with
respect to any other employee or consultant of a Borrower; provided that, with respect
to all of the foregoing insurance policies, Agent shall have a first priority
assignment and security interest (for the ratable benefit of the Lenders) in any
proceeds received by Borrowers.

     

    Landlord
Subordination of Lien means with respect to any real property leased by a
Borrower, a Landlord Subordination of Lien in the form attached hereto as Exhibit E
or otherwise in Proper Form, by and among Agent, such Borrower and the
landlord.

     

    Laws means
all applicable statutes, laws, treaties, ordinances, rules, regulations, orders,
writs, injunctions, decrees, judgments, and the terms of any license or permit
issued by any Governmental Authority.

     

    Lender and
Lenders
are defined in the introductory paragraph hereto.

    
      
         

      

      
        17

        
          

        

      

      
         

      

    

    Lender Observer
is defined
in Section
8.14(a).

     

    Lien means
any lien, mortgage, security interest, collateral assignment, pledge,
assignment, charge, title retention agreement, or encumbrance of any kind, and
any other right of or arrangement with any creditor (whether based on common
law, constitutional provision, statute or contract) to have its claim satisfied
out of any property or assets, or their proceeds, before the claims of general
creditors of the owner of the property or assets.

     

    Litigation
means, with respect to any Borrower, any claim, action, arbitration, suit,
investigation or administrative or other proceeding pending against or affecting
such Borrower by or before any court, arbitrator or Governmental
Authority.

     

    Loan means
individually, and Loans
means collectively, the Initial Term Loan, any Additional Term Loan and
any other amount loaned or advanced to or for the benefit of Borrowers by
Lenders under this Agreement.

     

    Loan Date
means, with respect to any Loan requested by Borrowers under this Agreement, the
date on which the applicable funds are transferred to, or made available to,
Borrowers.

     

    Loan
Documents means (a)this Agreement, any certificates delivered under this
Agreement and the Schedules to this Agreement, (b)the Notes, (c)the Warrants,
(d)the Security Documents, (e)the Noncompetition Letter Agreements, (f)the
Valley Note Subordination Agreement and any other Subordination Agreement,
(g)the Investor Rights Agreement, (h)the Small Business Side Letter, (i)the Flow
of Funds Memo, (j)any Loan Request, (k)any Compliance Certificate, (l)any
Joinder Agreement and (m)all other agreements, documents, and instruments in
favor of any Lender from time to time delivered to any Lender in connection with
or under this Agreement, and (n)all renewals, extensions, modifications,
supplements, restatements, and replacements of, or substitutions for, any of the
foregoing.

     

    Loan
Request means a request for a Loan substantially in the form of Exhibit L
signed by a Responsible Officer of the Company.

     

    Management
Person means each of Bianco, Narang, Monaco and Kaplan.

     

    Material Adverse
Event means any circumstance or event that, individually or collectively
with other circumstances or events, may reasonably be expected to result in
(a)impairment of the ability of any Borrower to perform any of its payment or
other material Obligations under any Loan Document, (b)impairment of the ability
of Agent or any Lender to enforce any of its respective rights or remedies, or
any Borrower’s Obligations, under any Loan Document, (c)a material and adverse
effect on the business, income, operations, prospects, assets, liabilities,
property or condition (financial or otherwise) of the Borrowers, when taken as a
consolidated whole, as represented to Agent or Lenders in the initial financial
statements delivered to Agent and Lenders (or as otherwise disclosed to Agent or
Lenders) on or about the Closing Date; or (d)a material and
adverse effect on any part of the Collateral; provided, however, that the
term “Material Adverse
Event” shall not mean or include (i) in and of itself, the failure of any
one or more of the Borrowers to perform in accordance with the Projections, or
(ii) any adverse changes in general economic conditions, international conflicts
or other events not directly related to the business activities of the
Borrowers.

    
      
         

      

      
        18

        
          

        

      

      
         

      

    

    Maturity
Date means the earliest to occur of the
following:  (a) the five (5) year anniversary of the Closing
Date, (b) the acceleration of the maturity of the Loans pursuant to Section 12.1
of this Agreement, (c) the date a Change of Control occurs, or (d) the
occurrence of the Termination Date pursuant to Section 5.6(c).

     

    Maximum Rate
and
Maximum Amount respectively mean, for Lenders, the maximum non-usurious
rate of interest and the maximum non-usurious amount of interest that, under
applicable Law, Lenders are permitted to contract for, charge, take, reserve or
receive on the Obligation.

     

    Monaco
means Joe Monaco, a resident of the State of New York.

     

    Moody’s
means Moody’s Investor Services, Inc.

     

    Narang
means Anil Narang, a resident of the State of Connecticut.

     

    Narang Contingent
Options means the options to purchase an aggregate of 1,279,484 shares of
Oak Tree Common Stock issued to Narang pursuant to that certain Stock Option
Agreement dated December 31, 2009, between the Company and Narang (as amended,
the “Narang
Option Agreement”), consisting of 639,742 “Tier I Options” and 639,742
“Tier II Options” and subject to certain conditions to exercisability as set
forth in the Narang Option Agreement.

     

    Net Income
means, for any period, the consolidated net income after taxes of all of the
Borrowers for such period (prepared in conformity with GAAP) but before
dividends, excluding, without duplication, extraordinary items such as (a)net
gain or loss during such period arising from the sale, exchange, or other
disposition of capital assets (including fixed assets and capital stock) other
than in the ordinary course of business, (b)write-up or write-down of assets,
and (c)provision for taxes on any extraordinary item.

     

    Net Interest
Expense means, for any period, (a) total consolidated Interest of the
Borrowers for such period in respect of all outstanding Debt of the Borrowers,
whether paid, accrued, expensed or capitalized, and includes, without
limitation, all commissions, discounts, commitment fees and other fees and
charges owed in respect of such Debt, including that portion of any lease
payment under a Capital Lease which would be treated as interest under GAAP and
interest on Debt used to finance working capital, minus (b) Borrowers’
aggregate consolidated interest income for such period.

     

    Net
Proceeds means (a) with respect to any sale, lease, transfer or other
disposition of any asset by any Borrower, the aggregate amount of cash and
non-cash proceeds from such transaction received by, or paid to or for the
account of, such Borrower, net of customary and reasonable out-of-pocket costs,
fees, and expenses, and (b) with respect to the issuance of Equity Securities,
debt securities, Subordinated Debt, or similar instruments, or any other
incurrence of Debt, the cash and non-cash proceeds received from such issuance
or incurrence, net of attorneys’ fees, investment banking fees, accountants
fees, underwriting discounts and commissions and other customary fees and
expenses actually incurred in connection with such issuance.  Non-cash
proceeds include any proceeds received by way of deferred payment of principal
pursuant to a note, installment receivable, purchase price adjustment
receivable, or otherwise, but only as and when received.

    
      
         

      

      
        19

        
          

        

      

      
         

      

    

    Net Working
Capital means (a) total consolidated current assets of the Borrowers
other than cash and Cash Equivalents, less (b) total
consolidated current liabilities of the Borrowers (including deferred revenues
and excluding the current portion of long-term Debt), as set forth on a
consolidated balance sheet of Borrowers and determined on a basis consistent
with GAAP.

     

    Noncompetition
Letter Agreements means, collectively, the letter agreements dated the
Closing Date, by and among Agent, the Company and each of Sanjo Squared, LLC,
Bianco, Narang, Kellis Veach, Monaco, Ashok Narang, Kaplan, Timothy Sauvage and
Barbara Paradise (except that the letter agreements with respect to Timothy
Sauvage and Barbara Paradise are only entered into between the Company and
Agent), which letter agreements grant to Agent third party beneficiary rights to
enforce the noncompettion and nonsolicitation obligations set forth in the
agreements referenced therein with respect to each of Sanjo Squared, LLC,
Bianco, Narang, Kellis Veach, Monaco, Ashok Narang, Kaplan, Timothy Sauvage and
Barbara Paradise, collectively attached hereto as Exhibit
I.

     

    Note means
individually, and Notes
means collectively, the Term Notes and any other promissory note issued
to Deerpath or any other Lender and evidencing all or any portion of the
Obligations, and any promissory notes issued in substitution or replacement
thereof.

     

    Oak Tree Fully
Diluted Common Stock is defined in Section
2.7(c).

     

    Oak Tree Common
Stock means all shares of common stock of Oak Tree, $0.0001 par value per
share, as may be authorized for issuance pursuant to its certificate of
incorporation, as the same may hereafter be amended or modified.

     

    Obligations
means, collectively, the Loans and all present and future Debt, liabilities and
obligations (including indemnities), and all renewals, increases and extensions
thereof, or any part thereof, now or in the future owed to any Lender or Agent
by any Borrower under any Loan Document, together with all interest
accruing thereon, reasonable fees, costs and expenses (including, without
limitation, all reasonable attorneys’ fees and expenses incurred in the
enforcement or collection thereof) payable under the Loan Documents or in
connection with the protection of rights or exercise of remedies under the Loan
Documents.

     

    Order
means any judgment, injunction, judicial or administrative order or decree
granted, made, issued or otherwise promulgated by any Governmental
Authority.

     

    Percentage
Interest means, with respect to each Lender, such Lender’s percentage
interest in the Loans (calculated as of the Closing Date as the percentage of
the Initial Term Loan that was funded by such Lender), which percentage
interests may be changed by the Lenders at any time.  As of the
Closing Date, and unless and until changed by Lenders, the Percentage Interest
of Deerpath, the sole Lender, shall be equal to one hundred percent
(100%).

    
      
         

      

      
        20

        
          

        

      

      
         

      

    

    Permitted
Acquisition means the collective reference to (a) the Culinary Group
Acquisition, and (b) any other Acquisition that is consummated following the
Closing Date by any of the Borrowers that the Agent shall have consented in
writing.

     

    Permitted
Debt means

     

    (m) the
Obligations;

     

    (n) Debt
arising from endorsing negotiable instruments for collection in the ordinary
course of business;

     

    (o) purchase
money Debt and Capital Lease obligations incurred in the ordinary course of
business which, in the aggregate, do not exceed $250,000 at any
time;

     

    (p) trade
payables, accrued expenses and other current liabilities incurred in the
ordinary course of business;

     

    (q) the
Valley Note and the Valley Earn-Out Payments;

     

    (r) the
Culinary Group Note;

     

    (s) Debt
incurred in connection with any Permitted Acquisition, to the extent approved in
writing by Agent;

     

    (t) Debt
incurred in connection with any private placement or other financing, to the
extent approved in writing by the Agent; and

     

    (u) Debt
among the Borrowers.

     

    Permitted
Liens means

     

    (v) Liens
directly securing the Obligations;

     

    (w) Liens
directly securing the Valley Note, granted pursuant to the Valley Note Security
Agreement;

     

    (x) Liens
which secure purchase money Debt and Capital Lease obligations permitted under
clause (c) of the
definition of Permitted Debt and which encumber only the assets acquired with
such purchase money Debt or the assets subject to such Capital
Lease;

     

    (y) Liens,
if any, on Permitted Debt referred to in paragraphs (f) and (g) of the
definition of “Permitted Debt”, to the extent approved in writing by
Agent;

     

    (z) Pledges,
deposits or Liens arising or made to secure payment of workers’ compensation,
unemployment insurance or other forms of governmental insurance or benefits or
to participate in any fund in connection with workers’ compensation,
unemployment insurance, pensions or other social security
programs;

    
      
         

      

      
        21

        
          

        

      

      
         

      

    

    (aa)      Easements,
rights-of-way, encumbrances and other restrictions on the use or value of real
property or any other property or asset which do not materially impair the use
thereof;

     

    (bb)      Liens
for Taxes and Liens imposed by operation of law (including, without limitation,
Liens of mechanics, materialmen, warehousemen, carriers and landlords, and
similar Liens) provided that (i) the amount secured is not overdue by more than
ninety (90) days and no Lien has been filed, or (ii) the validity or amount
thereof is being contested in good faith by lawful proceedings diligently
conducted, reserve or other provision required by GAAP has been made, levy and
execution thereon have been (and continue to be) stayed, or payment is fully
covered by insurance (subject to the customary deductible); and

     

    (cc)      
Rights of offset or statutory banker’s Liens arising in the ordinary course of
business in favor of commercial banks, provided that any such Lien shall only
extend to deposits and property in possession of such commercial
bank.

     

    Person
means any individual, partnership, limited partnership, corporation, limited
liability company, business trust, joint stock company, trust, unincorporated
association, joint venture, syndicate, Governmental Authority or other entity or
organization.

     

    Pledge Agreement
means that certain Pledge Agreement dated the Closing Date, by and among
the Company and each other Borrower that owns Equity Securities of another
Borrower, as pledgors, and Agent, as secured party for the ratable benefit of
the Lenders, attached hereto as Exhibit
C.

     

    Potential
Default means the occurrence of any event or the existence of any
circumstance that would, with the giving of notice or lapse of time or both,
become a Default.

     

    Principal
Debt means, when determined, the aggregate outstanding principal balance
of the Notes, plus any accrued and unpaid interest added pursuant to Section
3.5.

     

    Projections
is defined in Section
7.23(c).

     

    Proper
Form means in form and substance satisfactory to Agent, Lenders and their
legal counsel.

     

    Qualified Public
Offering means a firmly underwritten primary public offering of Equity
Securities of the Company under a registration statement filed by the Company
under the Securities Act which results in aggregate Net Proceeds to the Company
of at least $10,000,000.

     

    Regulatory
Problem means with respect to any Lender, (a) a diversion of the proceeds
of the financing hereunder from the use thereof reported on SBA Form 1031
delivered as of the date hereof, if such diversion was effected without
obtaining the prior written consent of Lenders (which may be withheld in
Lenders’ sole discretion), (b) a change in the principal business activity of
Borrowers to an ineligible business activity (within the meaning of the SBIC
Regulations) if such change occurs within one (1) year after the date of any
Loan hereunder or (c) any set of facts or circumstances wherein it has been
asserted by any governmental regulatory agency (or such Lender reasonably
believes that there is a substantial risk of such assertion) that such Lender
and its Affiliates are not entitled to hold, or exercise any significant right
with respect to, the Loans.

    
      
         

      

      
        22

        
          

        

      

      
         

      

    

    Reports is
defined in Section
7.26(a).

     

    Representative
means, with respect to any Person, any representative, officer, director,
manager, employee, consultant, contractor, attorney or agent of such
Person.

     

    Responsible
Officer of a Person (other than an individual) means the President, a
Vice President, Chief Executive Officer, Chief Financial Officer, Treasurer,
Comptroller, Chief Accounting Officer, Chief Operating Officer, or Director of
such Person.

     

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

     

    SBA means
the Small Business Administration.

     

    SBIC means
a small business investment company licensed under the SBIC Act.

     

    SBIC Act
means the Small Business Investment Act of 1958, as amended.

     

    SBIC Maximum Rate
is defined in Section
3.8.

     

    SBIC
Regulations means the SBIC Act and the regulations issued by the SBA
thereunder, codified at Title 13 of the Code of Federal Regulations, sections
107 and 121, as amended.

     

    Schedule
means a schedule attached to this Agreement unless otherwise
specified.

     

    SEC is
defined in Section
14.16.

     

    SEC
Documents  means the collective reference to the Form 10-K
Annual Report for the fiscal year ended December 31, 2009, Form 8-K Interim
Reports, Form 10-Q Quarterly Reports, Form 14-C Information Statement, Schedule
14F-1, and Form S-1 Registration Statement and all amendments thereto filed by
the Company with the SEC since December 31, 2009.

     

    Securities
Act means the Securities Act of 1933, as in effect from time to
time.

     

    Security
Agreement means that certain Security Agreement dated the Closing Date,
by and among Borrowers, as debtor and Agent, as secured party for the ratable
benefit of the Lenders, pursuant to which Borrowers granted Agent a Lien in the
Collateral (as defined therein) to secure the Obligations, attached hereto as
Exhibit
B.

     

    Security
Documents means the Security Agreement, the Pledge Agreement, any Deed of
Trust, any Landlord Subordination of Lien, all Deposit Account Control
Agreements, and all related instruments and documents executed and delivered to
Agent or any Lender at the Closing or pursuant to Section 6
or
Section 8.9, and all documents and UCC financing statements executed
in connection with the foregoing to create or perfect a Lien on the
Collateral.

    
      
         

      

      
        23

        
          

        

      

      
         

      

    

    Senior Debt
means, when determined, (a) all Obligations of Borrowers for borrowed
money under the Loans, excluding the accounting impact of any discount to the
GAAP book value of the Debt instrument resulting from the allocation of proceeds
from such borrowed money between the Debt instrument and concurrently issued
equity interests granted by such Person, plus (b) all purchase money
Debt and Capital Lease obligations of the Borrowers.

     

    Senior Debt to
EBITDA Ratio means, when determined, the ratio of the Borrowers’
(a) Senior Debt to (b) EBITDA for the most recently completed 12-month
period.

     

    Small Business
Side Letter means that certain Small Business Side Letter dated the
Closing Date, executed by the Borrowers and conforming to the SBIC Act, attached
hereto as Exhibit
J.

     

    Solvent
means, with respect to any Borrower, that based upon the Borrowers’ most recent
annual operating plan or the Current Financials as provided under Section
8.1, (a) the aggregate fair market value of such Borrower’s assets
exceeds such Borrower’s liabilities, (b) such Borrower has sufficient cash
flow to enable it to pay its Debts as they mature, and (c) such Borrower does
not have unreasonably small capital to conduct its businesses.

     

    Subordinated
Debt means the Valley Note, the Culinary Group Note and any other Debt
that is contractually subordinated in right of payment, collection, enforcement
and lien rights to the prior payment in full of the Obligations pursuant to a
Subordination Agreement on terms which are reasonably satisfactory to
Agent.

     

    Subordination
Agreement means individually, and Subordination
Agreements means collectively, each of the Valley Note Subordination
Agreement and any other subordination and intercreditor agreement by and among
Agent, as agent for the Lenders, any holder of Subordinated Debt, as
subordinated lender, and the Borrower(s) who are obligated under such
Subordinated Debt, in Proper Form.

     

    Subsidiary
of any Person means any corporation, partnership or other entity of which such
Person is the Beneficial Owner of at least fifty percent (50%) of the Voting
Interests.

     

    Subsidiary
Borrower and Subsidiary
Borrowers are defined in the introductory paragraph hereto.

     

    Tax means,
for any Person, any taxes, assessments or other governmental charges or levies
imposed upon that Person, its income, or any of its properties, franchises or
assets.

     

    Tax
Code  means the Internal Revenue Code of
1986, as amended, and related rules and regulations.

     

    TD Escrow
Shares means the “Escrow Shares”, as defined in that certain Interest
Purchase Agreement dated December 16, 2009, by and among EII, TD Management,
Inc., Monaco and the Company (the “Training Direct
Interest Purchase Agreement”).

    
      
         

      

      
        24

        
          

        

      

      
         

      

    

    Term Loan
is defined in Section
2.1.

     

    Term Loan
Commitment means the aggregate of the Initial Term Loan Commitment and
the Additional Term Loan Commitment.

     

    Term Note
means individually, and Term Notes
means collectively, each of the Deerpath Initial Term Note, any Additional Term
Note and any other promissory note issued to Deerpath or any other Lender and
evidencing all or any portion of the Term Loan, and any promissory notes issued
in substitution or replacement thereof.

     

    UCC means
the Uniform Commercial Code as adopted in New York and as amended from time to
time.

     

    Valley Earn-Out
Payments means the earn-out payments required to be made by Valley
Anesthesia, Inc. to the Valley Seller pursuant to Sections 1.02(c) and 1.02(d)
of the Valley Purchase Agreement.

     

    Valley Note
means that certain secured installment six (6) year promissory note dated
as of August 20, 2009, executed by Valley Anesthesia, Inc., and made payable to
the Valley Seller, in the initial principal amount of $2,000,000.

     

    Valley Note
Permitted Prepayment means the payment of (a) $35,494.72, representing
the installment due for the month of November 2010 under the Valley Note, and
(b) $212,968.32, representing the six (6) additional monthly installment
payments due for the months of December 2010 through May 2011, inclusive under
the Valley Note.

     

    Valley Note
Security Agreement means that certain Amended and Restated Security
Agreement dated the date hereof, by and between Valley Anesthesia, Inc. and
Valley Seller, which amended and restated in its entirety the Security Agreement
dated August 20, 2009.

     

    Valley Note
Subordination Agreement means that certain Subordination and
Intercreditor Agreement dated the Closing Date, by and among Agent, as agent for
the Lenders, the Valley Seller, as subordinated lender, and the Company,
attached hereto as Exhibit
F.

     

    Valley Permitted
Payments is defined in Section
9.14(c).

     

    Valley Purchase
Agreement means the purchase agreement dated August 20, 2009 among Valley
Seller and Valley Anesthesia, Inc.

     

    Valley Seller
means Valley Anesthesia Educational Programs, Inc., an Iowa
corporation.

     

    Voting
Interests of any Person means the shares of capital stock, membership
interests, partnership interests or other Equity Securities issued by such
Person that have voting power (whether pursuant to applicable Law, such Person’s
charter, shareholders agreement, partnership, company or operating agreement or
by any other contractual right) for the election, removal or replacement of, or
otherwise have the power to designate, (a) the members of such Person’s board of
directors, board of managers or other governing body performing similar
functions, or (b) if such Person is a limited partnership, the general partner
of such Person; provided, that
the “Voting Interests” of any member-managed limited liability company
shall be deemed to be the Equity Securities of such limited liability company
that are held by its managing member(s).  For the avoidance of doubt,
Warrant Equity Securities and Equity Securities that are issuable upon exercise
of stock options shall not constitute Voting Interests unless and until they are
issued upon exercise of such Warrant or stock option.

    
      
         

      

      
        25

        
          

        

      

      
         

      

    

    Warrant
and Warrants
means the Deerpath Warrant and any and all other warrants to purchase Equity
Securities of the Company that are issued to any Lender pursuant to this
Agreement or in connection with any assignment by another Lender of all or any
portion of its Warrant to such Lender, together with any other warrants
delivered in substitution or exchange for any of such warrants.

     

    Warrant Equity
Securities shall mean the Equity Securities of the Company issuable upon
exercise of the Warrants.

     

    1.2          Other Interpretive
Provisions.

     

    (a)  The
meanings of defined terms are equally applicable to the singular and plural
forms of the defined terms.  Words in respect of one gender include
each other gender where appropriate.

     

    (b)  With
reference to this Agreement and each other Loan Document, unless otherwise
specified in this Agreement or in such other Loan Documents,

     

    (i)           Article,
Section, Exhibit and Schedule references are to the Loan Document in which such
reference appears;

     

    (ii)          the
words “herein,”
“hereto,”
“hereof”
and “hereunder”
and words of similar import when used in any Loan Document shall refer to such
Loan Document as a whole and not to any particular provision
thereof;

     

    (iii)         the
terms “to
the Borrowers’ knowledge” and “to the knowledge
of Borrowers” and any other references to the knowledge or awareness of
Borrowers mean to the knowledge of each Borrower; a Borrower shall be deemed to
have “knowledge”
of a particular fact or matter if any director or executive officer of such
Borrower is actually aware of such fact or matter or could be expected to
discover or otherwise become aware of such matter in the course of conducting a
reasonably comprehensive investigation concerning the existence of such fact or
matter;

     

    (iv)         any
references to equity interests or other interests of “Lender” or
“Lenders”
in any entity, property or assets, and any references to things owned by “Lender” or
“Lenders”
or Obligations owed to “Lender” or
“Lenders”,
shall include all such equity interests, ownership interests and Obligations
owned by or owed to all of the Lenders, collectively;

     

    (v)          the
term “including”
is by way of example and not limitation;

    
      
         

      

      
        26

        
          

        

      

      
         

      

    

    (vi)         the
term “documents”
includes any and all instruments, documents, agreements, certificates, notices,
reports, financial statements and other writings, however evidenced, whether in
physical or electronic form; and

     

    (c)  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.”

     

    (d)  Section
headings in this Agreement 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.

     

    (e)  This
Agreement and the other Loan Documents are the result of negotiations among and
have been reviewed by counsel to Borrowers, Lenders and the other parties
thereto and are the products of all parties; accordingly, they shall not be
construed against Lenders merely because of Lenders’ involvement in their
preparation.

     

    1.3          Accounting
Principles.  All
accounting and financial terms used in the Loan Documents will be determined in
accordance with GAAP.  Unless otherwise indicated, all financial
calculations in respect of the Borrowers or any Borrower are on a consolidated
basis for the Borrowers and defined terms assume that financial information is
prepared or calculated on a consolidated basis for the Borrowers in accordance
with GAAP.  If any changes in GAAP are hereafter required or permitted
and are adopted by Borrowers on a consolidated basis with the agreement of their
certified public accountants and such changes result in a change in the method
of calculation of any of the financial covenants, restrictions or standards
herein or in the related definitions or terms used therein, the parties hereto
agree to enter into negotiations to amend such provisions so as to reflect
equitably such changes with the desired result that the criteria for evaluating
the financial condition of Borrowers on a consolidated basis shall be the same
after such changes as if such changes had not been made; provided, however, that no
change in GAAP that would affect the method of calculation of any of the
financial covenants, restrictions or standards or definitions of terms used
therein shall be given effect in such calculations until such provisions are
amended in a manner reasonably satisfactory to Lenders.

     

    1.4          Time.  Unless
otherwise specified, all references in this Agreement to times of day shall be
references to Eastern time (daylight or standard, as applicable).

     

    Section
2   Loan
Commitments.

     

    2.1          Initial Term
Loan.  Subject
to the terms and conditions of this Agreement, each Lender, severally and not
jointly, agrees to make, and shall make, a single advance Loan on a
non-revolving basis to Borrowers on or within two (2) days following the Closing
Date, in an amount for such Lender equal to its Percentage Interest of the
Initial Term Loan Commitment (the “Initial
Term Loan”).

    
      
         

      

      
        27

        
          

        

      

      
         

      

    

    2.2          Additional Term
Loans.  Subject
to the terms and conditions of this Agreement, from time to time after the
Closing Date, Lenders may, but shall not be required to, make additional Loans
to Borrowers (each, an “Additional Term
Loan” and collectively, the “Additional Term
Loans”), up to an aggregate additional amount not to exceed the
Additional Term Loan Commitment.  Except as otherwise mutually agreed
among Borrowers and Lenders, (a) Borrowers may request Additional Term Loans (i)
in minimum increments of $500,000 and (ii) primarily for the purpose of funding
(A) any earn-out obligations of Borrowers arising out of the Culinary Group
Acquisition or the Valley Acquisition, (B) future acquisitions by Borrowers
and (C) other growth initiatives by Borrowers, and (b) any Additional Term Loans
will have terms and fees consistent with the Initial Term Loan, except that
Borrowers shall not be required to issue any additional Warrants or other Equity
Securities in connection with any Additional Term Loans.  Any
Additional Term Loan by Lenders shall be subject to the conditions set forth in
Section
5.3.

     

    2.3          Loan
Procedure.  Subject
to compliance with Section 5
(or waiver by Lenders of any of the terms hereof), Borrowers may
request:

     

    (a)          the
Initial Term Loan by submitting a Loan Request to Lenders on or before the
Closing Date; and

     

    (b)          any
Additional Term Loan by submitting a Loan Request to Lenders at least ten (10)
Business Days prior to the proposed Loan Date for such Additional Term Loan,
which Loan Request shall include a brief description of the proposed use of
proceeds of such Additional Term Loan.  Lenders shall evaluate such
Loan Request and the proposed use of proceeds and respond, in their sole
discretion, with their proposed terms and conditions of such Additional Term
Loan, if any.

     

    2.4          Permitted
Prepayment.  Borrowers
may voluntarily prepay any or all of the Principal Debt from time to time as set
out below:

     

    (a)          Lenders
must receive Borrowers’ written or telephonic prepayment notice by
10:00 a.m. on the second (2nd)
Business Day before the date of the proposed prepayment;

     

    (b)          Borrowers’
prepayment notice shall specify the prepayment date;

     

    (c)          Any
prepayment pursuant to this Section 2.4
must be made in a minimum amount equal to $100,000, with minimum
increments of $10,000 in excess of $100,000; provided that if any amount
outstanding is less than $100,000 or is not a multiple of $10,000, prepayment of
the full amount outstanding may be made;

     

    (d)          concurrently
with (and in addition to) any and all payments of the Principal Debt that are
funded on or prior to the third anniversary of the Closing Date other than (x)
Annual Excess Cash Flow Prepayments and (y) required quarterly amortization
payments pursuant to Section
3.2(b), Borrowers shall pay to Lenders a premium in cash, as
follows:

     

    (i)           three
percent (3.00%) of the amount of Principal Debt prepaid if such prepayment
occurs on or prior to the first anniversary of the Closing
Date;

    
      
         

      

      
        28

        
          

        

      

      
         

      

    

    (ii)          two
percent (2.00%) of the amount of Principal Debt prepaid if such prepayment
occurs after the first anniversary of the Closing Date and on or prior to the
second anniversary of the Closing Date; or

     

    (iii)         one
percent (1.00%) of the amount of Principal Debt prepaid if such prepayment
occurs after the second anniversary of the Closing Date and on or prior to the
third anniversary of the Closing Date.

     

    For the
avoidance of doubt, nothing in this subsection (d) shall apply to any mandatory
prepayments required under Section
2.5.

     

    From and
after the first day immediately after the third anniversary of the Closing Date,
Borrowers may make optional prepayments of principal or interest in respect of
the Notes without premium or penalty.  Amounts repaid or prepaid in
respect of the Notes may not be re-borrowed without the Lenders’ written
consent.

     

    2.5          Mandatory
Prepayment.

     

    (a)          Excess Principal
Debt.  If the Principal Debt ever exceeds (i) the Initial Term
Loan Commitment, at any time prior to the funding of any Additional Term Loan by
Lenders, or (ii) the Initial Term Loan Commitment plus the aggregate principal
amount of any Additional Term Loans, at any time following the funding of any
Additional Term Loan(s) by Lenders, then Borrowers shall promptly prepay the
Principal Debt in the amount of that excess, together with all accrued and
unpaid interest on the principal amount prepaid.

     

    (b)          Excess Cash Flow
Sweep.

     

    (i)           Borrowers
shall make mandatory prepayments of the Principal Debt (not subject to any
prepayment penalty or premium) on an annual basis (each, an “Annual Excess
Cash Flow Prepayment”) in an amount equal to seventy-five percent (75%)
of Borrowers’ Excess Cash Flow for each Excess Cash Flow Period, provided that such Annual
Cash Flow Prepayments shall be made only if and to extent that they do not
reduce the aggregate cash available in Borrowers’ deposit accounts to an amount
below $250,000 as of the last day of such Excess Cash Flow Period.

     

    (ii)          The
amount of each Annual Excess Cash Flow Prepayment shall be calculated promptly
following completion of Borrowers’ certified annual financial statements
provided to Lenders pursuant to Section 8.1(a)
with respect to Borrowers’ fiscal year ending on the last day of the
applicable Excess Cash Flow Period, and Borrowers shall fund such Annual Excess
Cash Flow Prepayment to Lenders no later than twenty (20) Business Days
following delivery of such certified annual financial statements to Lenders;
provided, that if such
certified annual financial statements are not available within 130 days after
the last day of such fiscal year, then such Annual Excess Cash Flow Prepayment
shall be calculated based on the Borrowers’ internal financial statements for
such fiscal year and Borrowers shall fund the Annual Excess Cash Flow Prepayment
to Lenders no later than the 130th day
after the last day of such fiscal year; provided, further that
Borrowers shall fund the amount of any deficiency, if applicable, in the amount
of such Annual Excess Cash Flow Prepayment promptly upon receipt of the
certified annual financial statements for such fiscal year, and any excess
amount, if applicable, shall be returned to Borrowers promptly.

    
      
         

      

      
        29

        
          

        

      

      
         

      

    

    (c)  Mandatory Prepayments of
Proceeds.  At Agent’s election, the following amounts may
either be applied to the Obligations in accordance with Section 3.3
or retained by the applicable Borrower:

     

    (i)           100%
of the proceeds of any post-closing purchase price adjustment received by
Borrowers with respect to the Culinary Group Acquisition or any other
acquisition of a company or companies (whether by purchase of assets or equity
interests, merger or other transaction or series of transactions);

     

    (ii)          all
Net Proceeds from the disposition of any asset of any Borrower whether or not
permitted by Section
9.9 (other than
dispositions permitted under Section
9.9(a), (b) or
(c));

     

    (iii)         all
Insurance Proceeds and Eminent Domain Proceeds that relate to any Borrower’s
assets and that Lenders are entitled to receive under Section
8.12 (other than Insurance Proceeds used to restore or replace assets of
any Borrower as permitted under Section
8.12(c));

     

    (iv)         all
Net Proceeds of the issuance of Equity Securities by any Borrower other than the
Company, except if and to the extent that such Net Proceeds are used to fund
Valley Permitted Payments pursuant to Section 9.14(c)(i)(C);

     

    (v)          50%
of all Net Proceeds from any Qualified Public Offering or any other public
offering or private placement of Equity Securities of the Company;
and

     

    (vi)         100%
of the proceeds of any of the following received by Borrowers:  (A)
foreign, United States, state or local tax refunds, (B) judgments, settlements
or other consideration of any kind in connection with any cause of action, and
(C) indemnity payments.

     

    (d)  Amounts
repaid or prepaid in respect of the Notes may not be re-borrowed without the
Lenders’ written consent.

     

    2.6          Joint and Several
Obligations.

     

    (a)  The
Loans and all other Obligations of Borrowers arising under this Agreement and
the other Loan Documents shall constitute the joint and several Obligations of
Borrowers secured, until their final maturity and payment in full, by all of the
Collateral.  Notwithstanding the foregoing, at the time the Loans and
all other Obligations are paid in full and all commitments by Lenders hereunder
have been terminated or expired, Agent shall, at Borrowers’ sole cost and
expense, take any and all actions reasonably necessary and requested by the
Borrowers to release Agent’s security interest in and to the
Collateral.

    
      
         

      

      
        30

        
          

        

      

      
         

      

    

    (b)  Each
Borrower acknowledges that: (i) the business operations of each Borrower are
interrelated and complement one another, and that such entities have a common
business purpose, (ii) to permit their uninterrupted and continuous operations,
Borrowers now require the funds from Lenders as set forth in the Loan Documents,
and (iii) each Borrower has determined that the execution, delivery and
performance of this Agreement and any other Loan Documents to which such
Borrower is a party is within its purpose, will be of direct and indirect
benefit to such Borrower, and is in the best interest of such
Borrower.

     

    2.7          Issuance of Deerpath Shares
and Deerpath Warrant; Post-Closing True-Up.

     

    (a)  In
connection with the Initial Term Loan, the Company has authorized the issuance,
sale and delivery to Deerpath of:

     

    (i)           1,886,571
shares of Oak Tree Common Stock, constituting 7.50% of the Oak Tree Fully
Diluted Common Stock as of the Closing Date (together with any Equity Securities
of the Company delivered in substitution, replacement or exchange thereof or
pursuant to any stock dividend, the “Deerpath
Shares”), for an aggregate purchase price equal to $10.00;
and

     

    (ii)          a
warrant, issued for total consideration equal to $10.00 and initially
exercisable to purchase 628,857 shares of Oak Tree Common Stock, constituting
2.50% of the Oak Tree Fully Diluted Common Stock as of the Closing Date, at an
exercise price of $0.50 per share, attached hereto as Exhibit G
(as amended, and together with any other warrant delivered in
substitution, replacement or exchange of, or in addition to, such warrant,
collectively, the “Deerpath
Warrant”).

     

    (b)  Notwithstanding
anything in this Agreement, the Investor Rights Agreement or the Deerpath
Warrant to the contrary, it is the intention of Borrowers, Lenders and Agent
that, as at the Closing Date, (i) the Deerpath Shares shall consist of not less
than 7.50% of the Oak Tree Fully Diluted Common Stock and (ii) the shares of Oak
Tree Common Stock underlying the Deerpath Warrant shall consist of not less than
2.50% of the Oak Tree Fully Diluted Common Stock.

     

    (c)  For
purposes of this Agreement, the “Oak Tree Fully
Diluted Common Stock” means the aggregate number of the following
securities that are issued or are potentially issuable as at the Closing
Date:

     

    (i)           the
aggregate number of shares of Oak Tree Common Stock that are issued and
outstanding on a Fully Diluted Basis as of the Closing Date, but excluding,
solely for purposes of this subsection (i) and to avoid
duplication:

    
      
         

      

      
        31

        
          

        

      

      
         

      

    

    (A)          all
of the shares of Oak Tree Common Stock underlying the Bianco Contingent Options
and the Narang Contingent Options;

     

    (B)           the
TD Escrow Shares; and

     

    (C)           the
shares of Oak Tree Common Stock that are issuable or that may become issuable as
the Contingent Merger Consideration (as defined in the Culinary Group Merger
Agreement) pursuant to the terms and conditions of the Culinary Group Merger
Agreement;

     

    (ii)          the
622,640 shares of Oak Tree Common Stock underlying the remaining authorized and
unissued options under the Company’s 2009 Stock Incentive Plan;

     

    (iii)         the
aggregate number of all shares of Oak Tree Common Stock that are issued on or
issuable following the Closing Date as the Closing Merger Consideration (as
defined in the Culinary Group Merger Agreement) pursuant to the Culinary Group
Merger Agreement, including but not limited to any shares of Oak Tree Common
Stock that may be issued at any time pursuant to any indemnification claim or
other dispute with the ETI Shareholders arising out of the Culinary Group
Acquisition (other than the Contingent Merger Consideration (as defined in the
Culinary Group Merger Agreement);

     

    (iv)         the
aggregate number of all Deerpath Shares and all shares of Oak Tree Common Stock
underlying the Deerpath Warrant; and

     

    (v)          the
aggregate number of the Contingent Shares.  For purposes of this
Agreement, the “Contingent
Shares” means the aggregate of the following:

     

    (A) the
aggregate number of shares of Oak Tree Common Stock that the Bianco Contingent
Options and the Narang Contingent Options become exercisable for at any time,
and from time to time, pursuant to the terms and conditions of the Bianco Option
Agreement and the Narang Option Agreement, respectively, regardless of whether
any or all of such Bianco Contingent Options or Narang Contingent Options are
ever actually exercised by Bianco or Narang;

     

    (B) the
aggregate number of TD Escrow Shares that are issued and released to the Sellers
(as defined in the Training Direct Interest Purchase Agreement) at any time, and
from time to time, pursuant to the Training Direct Interest Purchase Agreement;
and

     

    (C) the
aggregate number of shares of Oak Tree Common Stock that are issued at any time,
and from time to time, as the Contingent Merger Consideration (as defined in the
Culinary Group Merger Agreement) pursuant to the Culinary Group Merger
Agreement;

    
      
         

      

      
        32

        
          

        

      

      
         

      

    

    (d)  Schedule 2.7
lists all of the (i) issued and outstanding shares of Oak Tree Common
Stock, (ii) outstanding warrants and options to purchase Oak Tree Common Stock,
(iii) authorized but unissued options to purchase Oak Tree Common Stock
under the 2009 Stock Incentive Plan, (iv) Contingent Shares and (v) other actual
or contingent obligations and earn-outs to issue shares of Oak Tree Common Stock
or warrants, options or other rights to purchase or acquire Oak Tree Common
Stock.  Schedule 2.7
also sets forth the following; provided, that Schedule 2.7
assumes an estimated VWAP (as defined in the Culinary Group Merger
Agreement) for the twenty Trading Days (as defined in the Culinary Group Merger
Agreement) immediately prior to the Closing Date equal to $2.50 per share, which
implies a total of 1,200,000 shares of Oak Tree Common Stock to be issued as
Closing Merger Consideration pursuant to the Culinary Group Merger
Agreement:

     

    (i)           Borrowers’
calculations of (A) the number of Deerpath Shares that constitutes 7.50% of the
Oak Tree Fully Diluted Common Stock and (B) the number of Oak Tree Common Shares
underlying the Deerpath Warrant that constitutes 2.50% of the Oak Tree Fully
Diluted Common Stock, in each case excluding any issuance of Contingent Shares
following the Closing; and

     

    (ii)          Borrowers’
calculations of (A) the number of Deerpath Shares that constitutes 7.50% of the
Oak Tree Fully Diluted Common Stock and (B) the number of Oak Tree Common Shares
underlying the Deerpath Warrant that constitutes 2.50% of the Oak Tree Fully
Diluted Common Stock, in each case assuming that 100% of the Contingent Shares
are issued following the Closing; and

     

    (e)  Based
on (i) Schedule
2.7, (ii) the representations and warranties of Borrowers in Section 7.20
(including the disclosures on Schedules
7.20(a), (b) and
(c)), and
(iii) the estimated VWAP (as defined in the Culinary Group Merger Agreement) for
the twenty Trading Days (as defined in the Culinary Group Merger Agreement)
immediately prior to the Closing Date equal to $2.50 per share, at the Closing
the amount of Oak Tree Fully Diluted Common Stock (excluding the Contingent
Shares) has been calculated to be equal to 25,154,276.  Accordingly,
at the Closing (i) the number of Deerpath Shares the Company is issuing to
Deerpath is equal to 1,886,571 shares of Oak Tree Common Stock, and (ii) the
number of shares of Oak Tree Common Stock underlying the Deerpath Warrant is
equal to 628,857.

     

    (f)  Notwithstanding
the foregoing, if, at any time and from time to time following the Closing Date,
the aggregate amount of the Oak Tree Fully Diluted Common Stock increases
(whether due to (i) the discovery of any error or omission on Schedule
2.7, including but not limited to any error in the number of issued and
outstanding shares of Oak Tree Common Stock on the Closing Date or any warrants
or options to purchase Oak Tree Common Stock not disclosed on Schedule
2.7, (ii) any Bianco Contingent Options or Narang Contingent Options
becoming exercisable pursuant to the Bianco Option Agreement or the Narang
Option Agreement, (iii) the issuance and release of any TD Escrow Shares to the
Sellers pursuant to the Training Direct Interest Purchase Agreement, (iv) the
issuance of additional shares of Oak Tree Common Stock as Closing Merger
Consideration under the Culinary Group Merger Agreement (whether due to a change
in the calculation of the VWAP for the twenty Trading Days immediately prior to
the Closing Date, in connection with any indemnification claim or other dispute
with the ETI Shareholders, or otherwise), or (v) the issuance of any shares of
Oak Tree Common Stock as Contingent Merger Consideration pursuant to the
Culinary Group Merger Agreement, then the Company shall promptly (A) issue and
deliver additional Deerpath Shares to Deerpath and (B) amend, modify, supplement
or replace the Deerpath Warrant, or issue an additional Deerpath Warrant, such
that the total number of Deerpath Shares shall be equal to 7.50% of such
adjusted Oak Tree Fully Diluted Common Stock and the total number of shares of
Oak Tree Common Stock underlying the Deerpath Warrant(s) shall be equal to 2.50%
of such adjusted Oak Tree Fully Diluted Common Stock.

    
      
         

      

      
        33

        
          

        

      

      
         

      

    

    (g)  Each
Borrower shall take such action as Agent or any Lender may reasonably request to
carry out more effectively the terms of this Section
2.7, including but not limited to providing Agent and Lenders with prompt
notice of any increase in the Oak Tree Fully Diluted Common Stock as described
in subsection (f) above, together with all reasonable supporting documents and
other information relating thereto, and executing, acknowledging, delivering and
recording or filing additional instruments, certificates or
documents.

     

    Section
3   Terms Of
Payment.

     

    3.1          Notes and Payments
Generally.

     

    (a)  Borrowers’
Debt under the Loans shall be evidenced by the Notes.  Each Borrower
hereby irrevocably authorizes each Lender to make (or cause to be made)
appropriate notations on the grids attached to the Notes (or on any continuation
of such grids or, at each Lender’s option, in its records), which notations, if
made, shall evidence, inter alia, the date of and the outstanding principal
balance of the portion of the Loan(s) evidenced thereby.  Such
notations shall be rebuttably presumptive evidence of the subject matter thereof
absent manifest error; provided, however, that the
failure to make any such notations shall not limit or otherwise affect any
Obligations of any Borrower.

     

    (b)           Except
as otherwise required by applicable Law, Borrowers must make each payment on the
Obligation, without offset, counterclaim or deduction, free and clear of all
Taxes (other than Taxes imposed on the net income of Lenders or franchise Taxes)
and without any withholding, restriction or condition imposed by any
Governmental Authority to Lenders’ designated depositary accounts or to Lenders’
designated principal offices, in funds that will be available for immediate use
by Lenders by 11:00 a.m. on the day due.  If any Borrower is required
by applicable Law to deduct any such amounts from or in respect of any sum
payable hereunder to any Lender, then the sum payable hereunder shall be
increased as may be necessary so that, after making all required deductions,
such Lender receives an amount equal to the sum it would have received had no
such deductions been made.  Payments received after the time noted in
the first sentence of this subsection (b) will be deemed
received on the next Business Day.  Whenever any payment to be made
hereunder shall be stated to be due on a date other than a Business Day, such
payment shall be made on the immediately preceding Business
Day.

    
      
         

      

      
        34

        
          

        

      

      
         

      

    

    3.2          Loan
Payments.

     

    (a)  Term Loan Interest
Payments.  Beginning January 1, 2011 and continuing until the
Principal Debt is paid in full, accrued interest on the Term Loan is due and
payable monthly in arrears on the first day of each month.

     

    (b)  Mandatory Amortization of
Term Loan.  Borrowers shall make payments of Principal Debt on
a quarterly basis (on the first day of each calendar quarter of Borrowers until
the Principal Debt is paid in full, commencing January 1, 2011 (i.e., on each
January 1, April 1, July 1 and October 1), in an amount equal to $75,000 per
quarter.

     

    (c)  Payments at
Maturity.  All outstanding Principal Debt and all accrued and
unpaid interest with respect to the Term Loan are due and payable on the
Maturity Date.

     

    (d)  ACH Authorization
Agreements.  No later than sixty (60) days following the
Closing Date, Borrowers shall execute and deliver to each Lender an ACH
Authorization Agreement and shall make, or cause to be made, all payments under
this Section 3.2
when due by ACH transfer or automatic debit from Borrowers’ accounts into each
Lender’s respective account as designated on attached Schedule 1
or such other account(s) as any Lender may designate in writing from time to
time.

     

    3.3          Order of
Application.

     

    (a)  If
no Default or Potential Default exists, all payments, permitted prepayments, and
mandatory prepayments shall be applied as specified in this Agreement, and if
not specified, such payments shall be applied among principal, interest, fees,
expenses, late charges, collection costs, and other charges under the Loan
Documents for which Lenders have not been paid or reimbursed at Agent’s sole
discretion.

     

    (b)  At
any time a Default or Potential Default exists, all payments (including the
proceeds from the exercise of any rights by Agent, any Lender or Borrower) shall
be applied among principal, interest, fees, expenses, late charges, collection
costs, and other charges under the Loan Documents for which Lenders have not
been paid or reimbursed at Agent’s sole discretion.

     

    (c)  Unless
otherwise agreed to by Lenders, (i) any payment, permitted prepayment and
mandatory prepayment under the Loans shall be applied between the Notes in
proportion to the Percentage Interests of the Lenders, and (ii) any prepayment
under the Loans shall be applied to reduce the Borrowers’ Principal Debt
repayment Obligations in the reverse order of maturity, beginning with the
Principal Debt due at the Maturity Date.

    
      
         

      

      
        35

        
          

        

      

      
         

      

    

    3.4          Interest
Rate.  Except
as otherwise provided in this Agreement, the Principal Debt shall accrue
interest at an annual rate equal to the lesser of (a) 13.50% per
annum and (b) the Maximum Rate.  Each change in the Maximum Rate
is effective as of the effective date of such change without notice to Borrowers
or any other Person.

     

    3.5          Default
Rate.  To
the extent permitted by Law, upon the occurrence and during the continuation of
any Default, the Principal Debt shall accrue interest, payable on demand, at an
annual rate equal to the lesser of (a) 17.50%
percent per annum and (b) the Maximum Rate (such interest rate, the “Default
Rate”).  Subject to Section 3.7,
Lenders may, to the extent permitted by Law, in their sole discretion, add
accrued and unpaid interest to the Principal Debt after any such amount is due
in accordance with this Agreement, and such amount will accrue interest until
paid at the applicable interest rate.

     

    3.6          Interest
Calculations.  Interest
on the Loans and all other amounts due under any Loan Document will be
calculated on the basis of actual number of days elapsed (including the first
day but excluding the last day) but computed as if each calendar year consisted
of 360 days (unless such computation would result in an interest rate in excess
of the Maximum Rate or interest in excess of the Maximum Amount, in which event
the computation is made on the basis of a year of 365 or 366 days, as the case
may be).  All interest rate determinations and calculations by Lenders
are presumptively correct absent manifest error.

     

    3.7          Maximum
Rate.  Regardless
of any provision in any Loan Document, it is the intention of Borrowers and
Lenders that Lenders not (a) contract for, charge, take, reserve, receive,
or apply, as interest on all or any part of the Obligations any amount in excess
of the Maximum Rate or the Maximum Amount or (b) receive any unearned
interest, in violation of any applicable Law.  If any acceleration of
the maturity of the Notes or any payment under the Loan Documents produces a
rate in excess of the Maximum Rate, or if Lenders shall for any reason receive
any such unearned interest, or if any transaction contemplated hereby or by any
other Loan Document would otherwise be usurious under applicable Law, then
(i) the aggregate of all interest under applicable usury laws that is
contracted for, charged, taken, reserved, received or applied under this
Agreement, or under any of the other Loan Documents or otherwise shall under no
circumstances exceed the Maximum Amount, (ii) no Borrower nor any other Person
shall be obligated to pay the amount of such interest to the extent that it is
in excess of the Maximum Amount, (iii) any excess or unearned interest
shall be deemed to be and shall be treated as a partial prepayment or repayment
of principal (not subject to any prepayment premium under Section
2.4) and any remaining excess or unearned interest will be refunded to
Borrowers, and (iv) the provisions of this Agreement, the Notes and the other
Loan Documents immediately shall be deemed reformed, without the necessity of
the execution of any new document or instrument, so as to comply with all
applicable usury laws.  In determining whether interest paid or
payable exceeds the Maximum Rate or the Maximum Amount, Borrowers and Lenders
shall, to the maximum extent permitted under applicable Law (w) treat all
Loans as a single extension of credit (Lenders and Borrowers agree that such is
the case), (x) characterize any non-principal payment as an expense, fee or
premium rather than as interest, (y) exclude voluntary prepayments or
repayments and their effects, and (z) amortize, prorate, allocate and
spread the total amount of interest throughout the entire contemplated term of
the Obligations.  However, if the Obligations is paid in full before
the end of its full contemplated term, and if the interest received for its
actual period of existence exceeds the Maximum Rate or the Maximum Amount,
Lenders shall refund any excess (and Lenders may not, to the extent permitted by
Law, be subject to any penalties provided by any Laws for contracting for,
charging, taking, reserving or receiving interest in excess of the Maximum
Amount).  If the applicable Law is amended in the future to allow a
greater rate of interest to be charged under this Agreement than is presently
allowed by applicable Law, then the “Maximum Rate” shall be
increased to the maximum rate of interest allowed by applicable Law as amended,
which increase shall be effective hereunder on the effective date of such
amendment, to the extent permitted by applicable Law.

    
      
         

      

      
        36

        
          

        

      

      
         

      

    

    3.8          Cost of Money
Ceiling.  If
the “cost of money” (including interest and certain prepayment premiums and
other consideration, as more fully defined in 13 C.F.R. §107.855) payable
on the Term Loan is in excess of the maximum permissible rate (the “SBIC Maximum
Rate”) permitted under 13 C.F.R. §107.855, that is the greater of
nineteen percent or the cost of money ceiling calculated pursuant to that
section, then at the election of any Lender (a) any “cost of money” payable on
the Term Loan in excess of that SBIC Maximum Rate shall be treated as a
repayment of principal (not subject to any prepayment premium under Section
2.4), (b) any remaining cost of money will be refunded to Borrowers, and
(c) the provisions of this Agreement, the Notes and the other Loan Documents
immediately shall be deemed reformed, without the necessity of the execution of
any new document or instrument, so as to comply with all 13 C.F.R.
§107.855.

     

    Section
4   Fees and
Expenses.

     

    4.1          Treatment of Fees and
Expenses.  To
the extent permitted by Law, the fees and expenses described in this Section 4
(a) do not constitute compensation for the use, detention, or forbearance of
money, (b) are in addition to, and not in lieu of, interest and expenses
otherwise described in this Agreement, (c) are payable in accordance with
Section 3.1(b),
(d) are non-refundable, (e) accrue interest, if not paid when due, at
the Default Rate, and (f) are calculated on the basis of actual number of
days elapsed (including the first day but excluding the last day), but computed
as if each calendar year consisted of 360 days (unless computation would result
in an interest rate in excess of the Maximum Rate or interest in excess of the
Maximum Amount, in which event the computation is made on the basis of a year of
365 or 366 days, as the case may be); provided, that the fees
described in this Section 4
are in all events subject to the provisions of Section
3.7.

     

    4.2          Structuring and Closing
Fees.  Concurrently
with the funding of the Initial Term Loan by Lenders, Borrowers shall pay to
Lenders (a) a structuring fee in an amount equal to $30,000.00, which is equal
to one percent (1.00%) of the Initial Term Loan Commitment, and (b) a
closing fee in an amount equal to $60,000.00, which is equal to two percent
(2.00%) of the Initial Term Loan Commitment.  On the date of each
advance of a Loan to Borrowers, Borrowers shall pay in cash to Lenders any other
fees and expenses provided for in Section 8.11
hereof (net of any expense deposit); provided, however, that, in
lieu of any such cash payment under this Section
4.2, Lenders may in their sole discretion elect to deduct such fees and
expenses from the applicable Loan.

    
      
         

      

      
        37

        
          

        

      

      
         

      

    

    Section
5   Conditions
Precedent.

     

    5.1           To
Closing.  This
Agreement will become effective once all parties have executed and delivered
this Agreement.

     

    5.2           To Initial Term
Loan.  The
obligation of Lenders to make the Initial Term Loan on or within two (2) days
following the Closing Date is, in addition to the conditions precedent specified
in Section 5.1,
subject to the following conditions precedent, each of which shall be
satisfactory in all respects to Agent, Lenders and their counsel:

     

    (a)  Lenders
have received all of the following items, each fully executed and in Proper
Form:

     

    (i)           this
Agreement;

     

    (ii)          the
Deerpath Initial Term Note;

     

    (iii)         the
Security Agreement;

     

    (iv)         the
Pledge Agreement;

     

    (v)          the
Valley Note Subordination Agreement;

     

    (vi)         the
Loan Request for the Initial Term Loan;

     

    (vii)        the
Deerpath Shares;

     

    (viii)       the
Deerpath Warrant;

     

    (ix)          the
Investor Rights Agreement;

     

    (x)           the
Noncompetition Letter Agreements with respect to each of Sanjo Squared, LLC,
Bianco, Narang, Kellis Veach, Monaco, Ashok Narang, Kaplan, Timothy Sauvage and
Barbara Paradise;

     

    (xi)          the
Small Business Side Letter;

     

    (xii)         the
Flow of Funds Memo;

     

    (xiii)       executed
copies of the Culinary Group Purchase Agreements and all ancillary and related
documents and agreements executed in connection with the Culinary Group
Acquisition, and evidence reasonably satisfactory to Agent and Lenders that the
closing of the Culinary Group Acquisition will occur concurrently with the
closing of the Initial Term Loan;

     

    (xiv)       the
Company’s Secretary’s Certificate certifying as to its articles of
incorporation, its bylaws, the incumbency of its officers executing Loan
Documents and their specimen signatures, and resolutions adopted by its Board of
Directors authorizing the Culinary Group Acquisition and the Initial Term
Loan;

    
      
         

      

      
        38

        
          

        

      

      
         

      

    

    (xv)        Secretary’s
Certificates of each other Borrower in substantially the same form as the
Secretary’s Certificate delivered by the Company;

     

    (xvi)       SBA
Forms 480, 652 and 1031, together with a written certification from Borrowers
regarding their intended use of the proceeds of the Term Loan;

     

    (xvii)      evidence
that all material consents, permits and approvals (governmental or otherwise)
required for the execution, delivery and performance by Borrowers of the Loan
Documents have been duly obtained and are in full force and effect;
and

     

    (xviii)     evidence
that all agreements executed by the Borrowers and/or their Equityholders between
themselves or with third parties prior to the date hereof have been amended,
supplemented, or terminated to the extent necessary (and such amended agreements
are in Proper Form) so as to not be in contravention of or conflict with the
provisions of any such agreement, any Loan Document or any other agreement
executed in connection herewith or therewith.

     

    (b)  Lenders
have received each of the following in Proper Form:

     

    (i)           UCC-1
Financing Statements with respect to the Collateral referenced in the Security
Documents;

     

    (ii)          Lien
search reports from the state and county UCC records, tax lien records,
bankruptcy records for each of the jurisdictions where any Borrower is organized
or authorized to do business or does business, which shows no Liens on the
Collateral other than Permitted Liens, including from the following
jurisdictions:

     

    (A) New
York Secretary of State, and

     

    (B) Delaware
Secretary of State,

     

    (iii)         Certificates
of Existence and Good Standing from Delaware and New York for the Company and
from New York and Iowa for the other Borrowers; and

     

    (iv)         Certificates
of Insurance or other proof, satisfactory to Lenders, that Borrowers have the
insurance coverage required by Section
8.8;

     

    (v)          all
collateral assignments of insurance policies required by Section 8.8;

     

    (vi)         appropriate
collateral filings with respect to registered intellectual
property;

    
      
         

      

      
        39

        
          

        

      

      
         

      

    

    (vii)        such
other certificates, documents and agreements as Agent or Lenders may reasonably
request.

     

    (c)  Each
of the following has been completed, satisfied, or is true and correct as of the
date of such funding:

     

    (i)           at
the sole discretion of Lenders, completion of Lenders’ due diligence regarding
the Culinary Group Acquisition, as well as the following with respect to
Borrowers:  Litigation, Taxes, accounting, labor, insurance, pension
liabilities, real estate leases, material contracts, Debt agreements, property
ownership, and contingent liabilities, the results of which are satisfactory to
Lenders in their sole discretion;

     

    (ii)          all
of the representations and warranties of the Borrowers in the Loan Documents are
true and correct in all material respects (except to the extent that the
representations and warranties speak to a specific date, in which case they
shall be true and correct as of such specific date);

     

    (iii)         no
Material Adverse Event exists;

     

    (iv)         no
material Litigation exists;

     

    (v)          no
Default or Potential Default exists;

     

    (vi)         Borrowers
have paid the fees under Section 4.2
and the fees and expenses under Section
8.11; and

     

    (vii)        The
Company shall have authorized the issuance of the Deerpath Shares and the
Deerpath Warrant to Deerpath.

     

    (d)  Borrowers’
delivery to Lenders of the Loan Request for the Initial Term Loan constitutes a
representation and warranty by the Borrowers to Lenders that the statements in
this Section
5.2 are true and correct in all respects.

     

    5.3          To Additional Term
Loans.  In
addition to the conditions precedent specified in Section 5.1, the
obligation of Lenders to make any Additional Term Loan pursuant to Section 2.2
shall be subject to (i) Lenders’ approval of such Additional Term
Loan in their sole discretion, which approval may be withheld by Lenders for any
reason or for no reason, and (ii) the following terms and conditions precedent,
each of which shall be satisfactory in all respects to Agent, Lenders and their
counsel:

     

    (a)  Such
Additional Term Loan shall be in an amount greater than or equal to
$500,000.

     

    (b)  Lenders
have received all of the following items, each fully executed and in Proper
Form:

     

    (i)           the
Loan Request for such Additional Term Loan;

    
      
         

      

      
        40

        
          

        

      

      
         

      

    

    (ii)          the
Company’s Secretary’s Certificate certifying as to its articles of
incorporation, its bylaws, the incumbency of its officers executing Loan
Documents on such Loan Date and their specimen signatures, and resolutions
adopted by its Board of Directors authorizing the Additional Term
Loan;

     

    (iii)         Secretary’s
Certificates of each other Borrower in substantially the same form as the
Secretary’s Certificate delivered by the Company;

     

    (iv)         such
other certificates, documents and agreements as Lenders may reasonably
request.

     

    (c)  Lenders
have received, if requested, each of the following in Proper Form:

     

    (i)           Certificates
of Existence and Good Standing from Delaware and New York for the Company and
from New York and Iowa for the other Borrowers; and

     

    (ii)          Certificates
of Insurance or other proof, satisfactory to Lenders, that Borrowers have the
insurance coverage required by Section
8.8.

     

    (d)  Each
of the following has been completed, satisfied, or is true and correct as of the
applicable Loan Date:

     

    (i)           all
of the representations and warranties of the Borrowers in the Loan Documents are
true and correct in all material respects (except to the extent that the
representations and warranties speak to a specific date, in which case they are
true and correct in all material respects as of such specific
date);

     

    (ii)          no
Material Adverse Event exists;

     

    (iii)         no
material Litigation exists;

     

    (iv)         no
Default or Potential Default exists; and

     

    (v)          Borrowers
have paid the fees under Section 4.2
and the fees and expenses under Section
8.11.

     

    Borrowers’
delivery of the Loan Request for such Additional Term Loan to Lenders shall
constitute a representation and warranty by the Borrowers to Lenders that the
statements in this Section
5.3 are true and correct in all respects.

     

    5.4           No Waiver.  Each
condition precedent in this Agreement is material to the transactions
contemplated by this Agreement, and time is of the essence with respect to each
condition precedent.

     

    5.5           Borrowers’
Conditions.  The
Obligations of the Borrowers to consummate the transactions contemplated by this
Agreement are subject to satisfaction of the following
conditions:

    
      
         

      

      
        41

        
          

        

      

      
         

      

    

    (b)           To Initial Term
Loan.  On the Closing Date (i) Borrowers shall have received
(i) the net proceeds (after deducting all fees and expenses under the Loan
Documents) of the Initial Term Loan; provided, that such condition
shall be deemed to be satisfied if Lenders initiate the wire transfer of such
funds to the account(s) designated in advance by Borrowers to receive such funds
within two (2) days following the Closing Date, regardless of whether such funds
are received and posted to such account(s) on the Closing Date, and
(ii) the Borrowers shall have received this Agreement and counterparts of
the other Loan Documents required to be executed by the Agent or the Lenders on
or within two (2) days following the Closing Date, duly executed by such
Persons.

     

    (c)           To Additional Term
Loans. On the Loan Date for each Additional Term Loan, Borrowers shall
have received (i) the net proceeds (after deducting all fees and expenses under
the Loan Documents) of such Additional Term Loan; provided, that such condition
shall be deemed to be satisfied if Lenders have initiated the wire transfer of
such funds to the account(s) designated in advance by Borrowers to receive such
funds, regardless of whether such funds are received and posted to such
account(s) on such Loan Date, and (ii) counterparts of the other Loan
Documents required to be executed by the Agent or the Lenders in connection with
such Additional Term Loan, duly executed by such Persons.

     

    Section
6   Security.

     

    6.1          Collateral; After-Acquired
Property.

     

    (a)  The
complete payment and performance of the Obligations shall be secured by all of
the items and types of property of each Borrower (collectively, the “Collateral”)
described as collateral or otherwise secured in the Security Documents,
including, without limitation, (i) all personal property, real property
interests (including all ownership, leasehold, mineral or other interests),
equity interests, accounts receivable, notes receivable, accounts, contracts,
intellectual property, general intangibles, inventory, equipment and
after-acquired property of each Borrower, (ii) all Equity Securities of any
Person owned by each Borrower, including but not limited to the Equity
Securities pledged pursuant to the Pledge Agreement, and (iii) any Title IV
national accreditation that is obtained by any Borrower.  Each
Borrower shall execute all applicable Security Documents necessary or
appropriate to perfect Lenders’ Liens in all of the Collateral it
owns.

     

    (b)  Within
five (5) Business Days after any Borrower creates or acquires any Subsidiary
after the Closing Date, such Borrower shall grant a security interest in and
pledge to Agent (for the ratable benefit of the Lenders), pursuant to a pledge
agreement in Proper Form, one hundred percent (100%) of its ownership in the
Equity Securities of such Subsidiary.

     

    (c)  Each
Borrower shall notify Agent within five (5) Business Days after such Borrower’s
acquisition or purchase of any ownership, leasehold, mineral or other interest
in any real property after the Closing Date, and, upon Agent’s request, such
Borrower shall execute, deliver, record and file any Deed of Trust, Landlord
Subordination of Lien (and shall cause the applicable landlord to execute any
such Landlord Subordination of Lien) and/or any other instruments or documents
(in Proper Form) that are necessary to provide Agent (for the ratable benefit of
the Lenders) a first priority Lien on such real property
interest.  Borrowers acknowledge that the execution of such Deeds of
Trust, Landlord Subordinations of Liens and other instruments and documents is a
part of the bargained-for exchange between Lenders and Borrowers and constitutes
a part of the consideration for the Loans.

    
      
         

      

      
        42

        
          

        

      

      
         

      

    

    (d)  Within
five (5) Business Days after any Borrower opens or acquires any deposit account
after the Closing Date, such Borrower shall execute and deliver to Agent (for
the ratable benefit of the Lenders) a Deposit Account Control Agreement in
Proper Form with respect to such deposit account.

     

    (e)  Each
Borrower shall notify Agent within five (5) Business Days after any Title IV
national accreditation is obtained by any Borrower or any of its Affiliates, and
upon Agent’s request at any time, Borrowers shall take such actions as shall be
reasonably necessary or appropriate to (i) grant a Lien on and pledge such Title
IV national accreditation to secure the Obligations, (ii) place such
accreditation in a special purpose Subsidiary, with 100% of the equity interests
of such special purpose Subsidiary to be pledged to secure the Obligations,
and/or (iii) obtain any and all required consents and approvals of Governmental
Authorities to the foregoing or to the change of control of the entity that
holds such accreditation.

     

    6.2           Financing
Statements.  Borrowers
hereby authorize Agent to execute or otherwise authenticate and file any
financing statements, continuation statements, and termination statements
recording Agent’s security interest in the Collateral, and Borrowers shall take
such other actions as are reasonably requested by Agent relating to the
Collateral, including, without limitation, initiating any Lien search reasonably
required by Agent.

     

    6.3           Priority.  Except
for Liens described in clause
(b) of the definition of Permitted Liens, Agent shall have a first
priority Lien on the Collateral.

     

    Section
7   Representations
And Warranties.

     

    Each
Borrower jointly and severally represents and warrants to Lenders on and as of
the Closing Date, after giving effect to the closing and effectiveness of the
Acquisition, as follows:

     

    7.1          Existence, Good Standing,
and Authority to do Business.  The
Company is a corporation duly organized, validly existing, and in good standing
under the Laws of the State of Delaware.  Each other Borrower is duly
organized, validly existing, and in good standing under the Laws of the
jurisdiction in which it is organized.  Each Borrower is duly
qualified to transact business and is in good standing as a foreign entity in
each jurisdiction where the nature and extent of its business and properties
require due qualification and good standing.  Except where the failure
to do so is not a Material Adverse Event, each Borrower (a) possesses all
requisite authority, power, licenses, permits, and franchises to conduct its
business as is now being, or is contemplated to be, conducted, and (b) is
in compliance with all applicable Laws.

    
      
         

      

      
        43

        
          

        

      

      
         

      

    

    7.2          Subsidiaries.  No
Borrower has any Subsidiaries except as set forth on Schedule
7.2.  Schedule 7.2
lists the jurisdiction of organization of each Subsidiary.

     

    7.3          Authorization, Compliance,
and No Default.  The
execution and delivery by each Borrower of the Loan Documents to which it is a
party and each Borrower’s performance of its Obligations under the Loan
Documents (a) are within its corporate, company or partnership power, (b)
have been duly authorized by all necessary corporate, company or partnership
action, (c) do not require action by, or filing with, any Governmental Authority
or any action by any other Person (other than any action taken
or filing made on or before the Closing Date), (d) do not violate any provision
of such Borrower’s organizational documents, (e) to the knowledge of such
Borrower, do not violate any material provision of Law or any order of any
Governmental Authority, in each case applicable to such Borrower, (f) do not
materially violate, or constitute a material breach of, any material agreements
to which it is a party (and no default exists on the part of such Borrower under
any agreement to which it is a party), and (g) will not result in the creation
or imposition of any Lien on any asset of any Borrower other than Liens in favor
of Agent.  Except as set forth in the SEC Documents or on Schedule
7.3, prior to the date hereof, no Borrower or Equityholder of a Borrower
has been required to amend, supplement or terminate any agreement to which such
Borrower or Equityholder of a Borrower is a party so as to not be in
contravention of or conflict with the provisions of any such agreement, any Loan
Document or any other agreement executed in connection herewith or
therewith.

     

    7.4          Binding
Effect.  Each
Loan Document (a) has been duly executed and delivered by each Borrower which is
a party to it, (b) constitutes the legal, valid and binding Obligation of each
Borrower which is a party to it, and (c) is enforceable against each Borrower
which is a party to it in accordance with its respective terms, except as
enforceability may be limited by applicable Debtor Relief Laws and general
principles of equity.

     

    7.5          Litigation.

     

    (a)  Except
as disclosed in the SEC Documents or on Schedule
7.5(a), no Borrower is subject to, or aware of the threat of, (i) any
Litigation involving any Borrower or any assets of any Borrower, or (ii) any
pending or, to the knowledge of Borrowers, asserted or threatened claims for
liability arising out of products sold or services rendered on or prior to the
Closing Date.  No Borrower knows of any valid basis for any such
Litigation or liabilities involving any Borrower, any Borrower’s assets or any
products sold or services rendered  by any Borrower.

     

    (b)  Except
as disclosed in the SEC Documents or on Schedule
7.5(b), there are no outstanding judgments, orders, injunctions, decrees,
citations, stipulations or awards (whether rendered by a court, administrative
agency, arbitral body or Governmental Authority) against or pertaining to any
Borrower or any assets of any Borrower.

     

    7.6           Taxes.  All
Tax returns required to be filed by each Borrower have been filed (or extensions
have been granted) before delinquency, and all Taxes imposed upon any Borrower
that are due and payable have been paid before delinquency, other than Taxes disclosed on
Schedule
7.6, which are being contested in good faith by lawful proceedings
diligently conducted, against which reserve or other provision required by GAAP
has been made.

    
      
         

      

      
        44

        
          

        

      

      
         

      

    

    7.7           Environmental
Matters.  Except
as disclosed in the SEC Documents or on Schedule
7.7, no Borrower has any environmental condition or circumstance
adversely affecting its assets, properties, or operations that could reasonably
be expected to result in a Material Adverse Event.  Except as
disclosed in the SEC Documents or on Schedule 7.7
(other than correspondence, notices and reports given and received (i) in
the ordinary course of business in respect of environmental matters previously
disclosed in the SEC Documents or on Schedule
7.7, and (ii) in respect of procedural matters relating to the periodic
renewal of, and application for, Environmental Permits), (a) no Borrower has
received written notice or report of, or written inquiry regarding, or is
otherwise subject to or bound by any obligation to remedy any violation of any
Environmental and Safety Law, and (b) no Borrower has received written notice or
report of, or written inquiry regarding, or is otherwise subject to any
liability under any Environmental and Safety Law arising out of or directly
affecting the properties or operations of any Borrower or any obligation of any
Borrower to remedy any violation of any Environmental and Safety
Law.  For each Borrower, each Environmental Permit necessary to
conduct its operations is currently in effect, and such Borrower’s conduct of
its operations is in full compliance with the terms and restrictions of each
such Environmental Permit.  No Borrower knows or has received notice
that any such Environmental Permit has been terminated.  No facility
of any Borrower is used for, or to the knowledge of any Borrower has been used
for, storage, treatment, or disposal of any Hazardous Substance in violation of
any applicable Environmental and Safety Law, other than violations that
individually or collectively would not constitute a Material Adverse
Event.

     

    7.8           Ownership of Assets;
Intellectual Property.  Except
as disclosed in the SEC Documents or on Schedule
7.8, no Borrower has any ownership, leasehold or other interest in any
real property.  Each Borrower has (a) indefeasible title to its owned
real property, (b) a vested leasehold interest in all of its leased real
property, and (c) good and marketable title to all of its personal property, all
as reflected on the Current Financials (except for property that has been
disposed of as permitted by Section
9.9).  All assets material to the Borrowers’ operations are
owned by a Borrower or are leased from a Person which is not an Affiliate of
Borrowers, other than as disclosed in the SEC Documents or on Schedule 7.18.  Each
Borrower owns or has the right to use and assign all material licenses, patents,
patent applications, copyrights, service marks, trademarks, trademark
applications, trade names and software licenses necessary to continue to conduct
its businesses as presently conducted by it and as proposed to be conducted by
it immediately after the Closing Date.  Each Borrower is conducting
its business without infringement or claim of infringement of any license,
patent, copyright, service mark, trademark, trade name, trade secret or other
intellectual property right of any other Person, other than any infringements
or claims that, if successfully asserted against or determined adversely to any
Borrower, would not, individually or collectively, constitute a Material Adverse
Event.  To the knowledge of the Borrowers, no infringement or claim of
infringement by any other Person of any material license, patent, copyright,
service mark, trademark, trade name, trade secret or other intellectual property
of any Borrower exists.

     

    7.9           Liens.  No
Lien exists on any asset of any Borrower other than Permitted
Liens.

     

    7.10         Debt.  No
Borrower is an obligor on any Debt other than Permitted Debt.

    
      
         

      

      
        45

        
          

        

      

      
         

      

    

    7.11        Insurance.  Schedule 7.11
contains a list of all of the insurance policies covering the assets,
businesses, operations, product liability, employees, officers, managers and
directors of Borrowers.  Borrowers maintain insurance at all times
with financially sound, responsible and reputable insurance companies or
associations (or, as to workers’ compensation or similar insurance, with an
insurance fund or by self insurance authorized by the jurisdictions in which it
operates) that possess a minimum A.M. Best Financial Strength Rating of B+ or
better.  Borrowers maintain insurance concerning each Borrower’s
assets, businesses, operations, product liability, employees, officers, managers
and directors, against such damages, losses, casualties, liabilities and
contingencies and of the types and in the amounts (and with co-insurance and
deductibles) as are reasonable and customary for Borrowers’
businesses.

     

    7.12        Full
Disclosure.  Each
material fact or condition relating to the Loan Documents and the Borrowers’
financial condition, obligations, liabilities, business, operations, assets,
property or prospects has been disclosed to Lenders in writing.  All
such information (a) is true and accurate in all material respects and does not
fail to state any fact the omission of which would otherwise make any such
information materially misleading, and (b) in the case of projections and
financial information, is based on reasonable estimates on the date the
information is stated or certified and does not fail to state any fact the
omission of which would otherwise make any such information materially
misleading.

     

    7.13        Place of
Business.  The
location of each principal executive office or other material place of business
of each Borrower is set out on Schedule
7.13.  The books and records of each Borrower concerning
accounts and accounts receivable are located at one or more of the locations set
forth on Schedule
7.13.  All of each Borrower’s inventory (other than inventory
on consignment, in transit, or in the possession of a Person under the terms of
a contract with a Borrower) is in its possession and, together with its other
material assets, are located (until disposed of in the ordinary course of
business), at one or more of the locations set out on Schedule
7.13.

     

    7.14        Use of
Proceeds.

     

    (a)  Initial Term
Loan.  Borrowers will use the proceeds of the Initial Term Loan
(i) to fund a portion of the purchase consideration for the Culinary Group
Acquisition, (ii) to fund the Valley Note Permitted Prepayments, (iii) to fund
the transaction costs, fees and expenses of the Initial Term Loan and the
Culinary Group Acquisition, and (iv) for the Borrowers’ general working
capital purposes.

     

    (b)  Additional Term
Loans.  Except as otherwise agreed to in writing by Lenders in
connection with any Additional Term Loan, Borrowers shall use the proceeds of
any and all Additional Term Loans for the purpose of funding (i) any earn-out
obligations of Borrowers arising out of the Culinary Group Acquisition,
(ii) future Permitted Acquisitions by Borrowers and (iii) other growth
initiatives by Borrowers.

     

    (c)  Prohibited Uses of
Proceeds.  No Borrower is engaged principally, or as one of its
important activities, in the business of extending credit for the purpose of
purchasing or carrying any “margin stock” within the
meaning of Regulation U
of the Board of Governors of the Federal Reserve System, as
amended.  No part of the proceeds of the Loans will be used, directly
or indirectly, for a purpose that violates any Law, including without
limitation, the provisions of Regulation U or Regulation X of the Board of
Governors of the Federal Reserve System.  Each Borrower represents and
warrants that no portion of the Loans shall be used directly or indirectly to
purchase ineligible securities, as defined by applicable regulations of the
Federal Reserve Board, underwritten by any Affiliate of a Lender during the
underwriting period and for thirty (30) days thereafter.

    
      
         

      

      
        46

        
          

        

      

      
         

      

    

    7.15        Employee
Benefits.

     

    (a)  Schedule 7.15(a)
contains a list of all of Borrowers’ Employee Plans.  Except
where occurrence or existence is not a Material Adverse Event,
(i) Borrowers are in compliance with ERISA and the terms and conditions of
each Employee Plan, (ii) no Employee Plan has incurred an “accumulated funding
deficiency” (as defined in section 302 of ERISA or section 412 of the Tax
Code), (iii) no Borrower has incurred liability under ERISA to the PBGC in
connection with any Employee Plan (other than required insurance
premiums, all of which have been paid), (iv) no Borrower has withdrawn in
whole or in part from participation in a “multiemployer plan” (as
defined in Section 3(37) of ERISA), (v) no Borrower has engaged in any
“prohibited
transaction” (as defined in Section 406 of ERISA or section 4975 of the
Tax Code), and (vi) no “reportable event” (as defined
in Section 4043 of ERISA) has occurred, excluding events for which the notice
requirement is waived under applicable PBGC regulations.

     

    (b)  All
payments due from any Borrower for employee health and welfare insurance have
been paid or accrued as a liability in its Current Financials, other than any nonpayments
that are not, individually or collectively, a Material Adverse
Event.

     

    7.16        Laws Relating to
Employment.

     

    (a)  Except
as set forth in the SEC Documents or on Schedule
7.16(a), Borrowers are not currently subject to any complaints, charges,
claims, consent decrees, judgments, arbitration awards, or Orders from any
Governmental Authority concerning any federal, state or local Laws regarding
employment and employment practices, the terms and conditions of employment,
non-discrimination, equal employment opportunity, affirmative action, collective
bargaining, payment of social security, occupational safety and health, wages
and hours, plant closing, workers compensation and any and all of the employment
Laws, regulations or statutes cited above.

     

    (b)  Borrowers
and their respective facilities, businesses, operations, assets and property
have been in material compliance for the past three (3) years and are currently
in material compliance with all applicable Laws and Orders regarding employment
and employment practices, the terms and conditions of employment,
non-discrimination, equal employment opportunity, affirmative action, collective
bargaining, payment of social security, occupational safety and health, wages
and hours, plant closing and workers compensation, including but not limited to
the Immigration Reform and Control Act, Title VII of the Civil Rights Act of
1964, the Fair Labor Standards Act, the Federal Occupational Safety and Health
Act, the Age Discrimination in Employment Act, the Americans with Disability
Act, the Family Medical & Leave Act, the National Labor Relations Act, the
labor codes promulgated by the States and regulations promulgated thereunder or
any other federal or state statute, ordinance or regulation governing, touching
upon or concerning the employment relationship, in each case as amended and in
effect as of the Closing Date.  Borrowers have not engaged at any time
during the past three (3) years, and are currently not engaging, in any unfair
labor practice.  There are not any pending or, to the knowledge of
Borrowers, threatened charges, claims, complaints, administrative complaints, or
lawsuits alleging (i) breach of an employment contract (whether in fact,
expressed or implied), (ii) a claim for workers’ compensation, (iii) any tort
such as invasion of privacy, defamation, or intentional infliction of emotional
distress, or (iv) any violation of any employment Law, regulation or statute,
including, but not limited to, the statutes and Laws cited in this Section 7.16.

    
      
         

      

      
        47

        
          

        

      

      
         

      

    

    (c)  Borrowers
are and have always been in material compliance with all applicable Immigration
Laws.  Borrowers’ employees and contractors have verified their legal right
to work in the United States of America through Form I-9s or similar documents
consistent with applicable Immigration Laws.

     

    7.17        Trade
Names.  No
Borrower has used or transacted business under any other corporate or trade name
in the five-year period preceding the Closing Date, except as disclosed on Schedule
7.17.  Schedule
7.17 includes the names of all Persons with which any Borrower has merged
or consolidated, or from which any Borrower has acquired all or substantially
all of such Person’s assets, in each case in the five-year period preceding the
Closing Date.

     

    7.18        Transactions with
Affiliates.

     

    (a)  Except
as disclosed in the SEC Documents or on Schedule
7.18(a), no Borrower is a party to any material contract, agreement,
arrangement or transaction, whether written or oral, with any of the
following:  (i) any director, manager, officer or key employee of a
Borrower, (ii) any spouse or immediate family member or Affiliate of any of
its directors, managers, officers or key employees or (iii) any of its
Affiliates (excluding other Borrowers), other than (A) written
employment, noncompetition and confidentiality agreements (including the
Noncompetition Letter Agreements), executed copies of which have been provided
to Lenders prior to the Closing Date, (B) at-will employment arrangements with
employees who are not related (by blood or marriage) to any director, manager,
officer or key employee of a Borrower, and (C) any partnership agreement,
company agreement, operating agreement, shareholders agreement or other similar
governing agreement for such Borrower, an executed copy of which has been
provided to Lenders prior to the Closing Date.

     

    (b)  Except
as disclosed in the SEC Documents or on Schedule
7.18(b), each contract, agreement, arrangement or transaction listed or
required to be listed on Schedule
7.18(a) was entered into in the ordinary course of business and upon fair
and reasonable terms not materially less favorable than the applicable Borrower
could obtain or could become entitled to in an arm’s-length transaction with a
Person that was not one of its Affiliates, directors, managers, officers or key
employees or one of their spouses or immediate family members or
Affiliates.

    
      
         

      

      
        48

        
          

        

      

      
         

      

    

    (c)  For
purposes of this Section
7.18, a contract, agreement, arrangement or transaction is “material” if it requires any
Borrower to pay or provide products or services of more than $100,000 during the
term of the governing agreement.

     

    7.19       Government
Regulation.

     

    (a)  No
Borrower is an “investment
company” or a company “controlled” by an “investment company” or a
“subsidiary” of an
“investment company”,
within the meaning of the Investment Company Act of 1940.

     

    (b)  No
Borrower is a “holding
company”, or a “subsidiary company” of a
“holding company”, or
an “affiliate” of a
“holding company” or of
a “subsidiary company”
of a “holding company”,
within the meaning of the Public Utility Holding Company Act of 1935 or any
other federal or state statute that restricts or limits any Borrower’s ability
to incur Debt or to perform any Borrower’s Obligations hereunder or under any
other Loan Document.

     

    (c)  No
Borrower is subject to regulation as a “common carrier” or “contract carrier” or any
similar classification by the Interstate Commerce Commission or under the laws
of any state, or is subject to regulation under any other federal, state or
local statute which limits its ability to incur Debt.

     

    (d)  The
making of the Loans by Lenders to Borrowers, the application of the proceeds
thereof and repayment thereof will not violate any provision of any statute or
any rule, regulation or order issued by the SEC.

     

    (e)  Each
Borrower acknowledges that Deerpath is a federally licensed SBIC and is subject
to the SBIC Regulations.  Borrowers, together with their “affiliates” (as defined in 13
CFR § 121.103), are a “small
business concern” within the meaning of the SBIC
Regulations.  The information set forth in SBA Forms 480, 652 and
Section A of Form 1031 regarding Borrowers, which have been prepared with
information provided by Borrowers, is accurate and complete.  Copies
of such forms have been completed and executed by
Borrowers.  Borrowers do not presently engage in, and will not engage
in, any activities, and will not use directly or indirectly the proceeds from
the Loans for any purposes for which an SBIC is prohibited from providing funds
by the SBIC Regulations.

     

    At least
fifty-one percent (51%) of the employees of Borrowers are located within the
United States and at least fifty-one percent (51%) of the tangible assets of
Borrowers are located within the United States.  The proceeds of the
Loans are intended for use and shall only be used for specific domestic purposes
within the United States including, for example, payroll for employees located
within the United States or acquiring assets for use solely within the United
States, and no portion of such proceeds shall be used, directly or indirectly:
(i) to purchase stock in or provide capital to an SBIC; (ii) to acquire farm
land; or (iii) for any purpose contrary to the public interest, including
activities which are in violation of Law or inconsistent with free competitive
enterprise.

    
      
         

      

      
        49

        
          

        

      

      
         

      

    

    7.20        Capitalization.

     

    (a)  The
SEC Documents list the owners of five percent (5%) or more of the outstanding
Equity Securities of the Company and all Equity Securities owned by executive
officers and directors of the Company.  Schedule
7.20(a) lists the owners of all authorized and outstanding Equity
Securities of each Borrower other than the Company, including options and other
equity equivalents of each Borrower, pre-Closing and as of (and after giving
effect to) the Closing, together with the amount and percentage of such Equity
Securities held by each such owner.  All of the outstanding Equity
Securities of Borrowers are validly authorized and issued, fully paid and
nonassessable, and free and clear of any and all Liens (other than Liens in
favor of Agent pursuant to the Security Documents).

     

    (b)  Except
as contemplated by the Warrants and as set forth in the SEC Documents or on
Schedule 7.20(b):  (i) there
are no outstanding or any present plans to issue any shares of capital stock or
other Equity Securities, securities, rights, warrants or options convertible or
exchangeable into or exercisable for any shares of capital stock or other Equity
Securities, stock appreciation rights or phantom stock of any Borrower; provided, that, nothing
contained in this Section 7.20
shall restrict any Borrower from granting equity options to its managers or
directors pursuant to Agent’s prior written consent, (ii) no Borrower is under
any obligation, contingent or otherwise, to redeem or otherwise acquire any
shares of its capital stock or other Equity Securities or any securities, rights
or options to acquire such capital stock, Equity Securities, stock appreciation
rights or phantom stock, and (iii) there are no agreements (other than any
applicable Loan Documents) between any Persons, Equityholders, or managers or
directors of any Borrower with respect to the voting or transfer of any Equity
Securities of a Borrower owned by such parties or with respect to any other
aspect of their affairs concerning any Borrower.

     

    (c)  Except
as contemplated by the Warrants and as set forth in the SEC Documents or on
Schedule 7.20(c),
(i) there are no statutory or contractual shareholders’ preemptive rights with
respect to the Equity Securities of any Borrower, (ii) no Borrower has violated
any applicable federal or state securities laws in connection with the offer,
sale or issuance of any of its Equity Securities, and (iii) there are no
agreements granting registration rights to any Person with respect to any Equity
Securities of a Borrower.

     

    (d)  None
of the items, agreements, arrangements or other disclosures set forth in the SEC
Documents or on Schedule 7.20(b)
or Schedule
7.20(c) conflicts with the rights granted to Agent or any Lender in the
Loan Documents or any related agreements executed simultaneously
herewith.

     

    7.21        Compliance with Laws;
Certain Operations.  Each
Borrower and to the knowledge of each of the Borrowers, each of the officers,
directors, managers and employees of each Borrower have complied in all material
respects with all applicable Laws relating to the businesses of Borrowers and
all applicable requirements of any Governmental Authority or self-regulatory
organization.  No notices, citations, claims or orders have been filed
or granted against any Borrower alleging or finding violation of, or liability
or responsibility under, any such Law which have not been heretofore
settled.

    
      
         

      

      
        50

        
          

        

      

      
         

      

    

    7.22        Solvency.  Each
Borrower is Solvent prior to, and after giving effect to, the transactions
contemplated hereby.  No transfer of property is being made and no
obligation is being incurred in connection with such transactions with actual
intent to hinder, delay or defraud any  present or future creditors of
any Borrower.

     

    7.23        Financials.

     

    (a)  Amendment
No. 2 to the registration statement of the Company on Form S-1 filed with the
SEC on August 31, 2010, and included in the SEC Documents, contains the
historical audited and interim financial statements of the Borrowers for the two
fiscal years ended December 31, 2009 and as at June 30, 2010 and for the six
month period then ended, or from the date of inception, if a lesser
period.  The Company has also furnished the Agent true and complete
copies of (i) the audited financial statements of the Valley Seller as at
December 31, 2007, December 31, 2008 and August 20, 2009, and for the fiscal
periods then ended, and (ii) the unaudited historical financial statements of
the Culinary Group Sellers, in each case, for the two fiscal years ended
December 31, 2009 and for the six month interim periods ended June 30, 2009 and
June 30, 2010 (all
such financial statements described in this Section
7.23(a), collectively, the “Financial
Statements”).

     

    (b)  Except
as set forth on Schedule 7.23(b),
the Financial Statements were prepared in accordance with GAAP and Borrowers’
past accounting practices, except that the unaudited financial statements are
subject to customary audit adjustments and may not include footnotes required in
accordance with GAAP.  The Financial Statements present fairly
the consolidated financial position of Borrowers as of the dates thereof and the
consolidated results of their operations for the periods then
ended.  Since December 31, 2009, Borrowers’ businesses have been
operated in the ordinary course thereof consistent with past practices and there
has not occurred, and no event, occurrence or condition exists, which was or
could reasonably be determined to be a Material Adverse Event.

     

    (c)  Borrowers
have also delivered to Lenders certain projections of profits and losses (the
“Projections”)
of Borrowers’ (and, with respect to the portion of calendar year 2010 prior to
the Closing Date, the Culinary Group Sellers’) profit and loss statement for
calendar years 2010 through 2014.  The Projections represent estimates
of Borrowers’ future financial performance for the period set forth therein, and
Borrowers believe such estimates are fair and reasonable in light of the current
and reasonably foreseeable future conditions.

     

    7.24        Absence of Undisclosed
Liabilities.  Except
as disclosed in the SEC Documents, there are no liabilities or any facts or
circumstances that could give rise to liabilities, whether accrued, known, due
or to become due, contingent, absolute, determined, determinable or otherwise,
and regardless of when asserted, of any Borrower arising out of (a) any
transaction entered into, product sold, service rendered or action or inaction
by any Borrower on or prior to the date hereof, or (b) any state of facts
existing on or prior to the date hereof, other than
(i) liabilities set forth in the Current Financials and (ii) other
undisclosed liabilities incurred since the date of the Current Financials in the
ordinary course of business that could not, individually or in the aggregate,
reasonably be expected to result in a Material Adverse Event.

    
      
         

      

      
        51

        
          

        

      

      
         

      

    

    7.25        Employee
Matters.  Except
as set forth in the SEC Documents or on Schedule 7.25:

     

    (a)  no
employee of a Borrower is currently represented by any labor union, no Borrower
is a party to any collective bargaining agreement, and there is no
organizational effort presently being made or threatened by or on behalf of any
labor unions with respect to employees of any Borrower;

     

    (b)  there
is no unfair labor practice complaint against any Borrower pending before the
National Labor Relations Board;

     

    (c)  there
is no labor strike, dispute, slow down, walkout, work stoppage, representation
campaign other concerted interruption of operations pending or, to the knowledge
of Borrowers, threatened by the employees of any Borrower or otherwise against
any Borrower;

     

    (d)  there
has been no change in the compensation of any employee of Borrowers since
December 31, 2009, other than increases in the ordinary course of business that
are reflected or accounted for in the Projections; provided, however, there
shall have been no change in the compensation of any employee who is also an
Equityholder of a Borrower; and

     

    (e)  to
the best of Borrowers’ knowledge, no officer or employee of any Borrower has
entered into any agreement which is now in effect with any person, corporation,
partnership or business organization other than Borrowers requiring such person
to assign any interest in any invention or trade secrets or to keep confidential
any trade secrets or other proprietary information or containing any prohibition
or restriction on competition or solicitation of customers.

     

    7.26        SEC Documents and
Compliance.

     

    (a)  Since
May 4, 2007, the Company has filed on a timely basis with the SEC all reports,
schedules, forms, statements and other documents required to be filed by the
Company under the Securities Act and the Exchange Act, including pursuant to
Section 13(a) or 15(d) thereof (the foregoing documents, including all exhibits,
financial statements and schedules attached thereto and any document
incorporated by reference therein, being collectively referred to herein as the
“Reports”),
or has received a valid extension of such time of filing and has filed any such
Report prior to the expiration of any such extension.  As of their
respective dates, the Reports complied in all material respects with the
requirements of the Securities Act and the Exchange Act, as applicable, and none
of the Reports, when filed, contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading.  No executive officer of the Company
has failed to make the certification required of him or her under Section 302 or
906 of the Sarbanes-Oxley Act with respect to any Report.  As of the
date of this Agreement, there are no outstanding or unresolved comments received
from the SEC staff with respect to the Reports, and none of the Reports is
subject to ongoing review or outstanding SEC comment or investigation. A
complete and accurate list of the Reports is available on the SEC’s web site at
www.sec.gov.

    
      
         

      

      
        52

        
          

        

      

      
         

      

    

    (b)  As
of their respective dates, the consolidated financial statements of the Company
and all Subsidiary Borrowers included in the Reports complied as to form in all
material respects with applicable accounting requirements, the Securities Act
and the Exchange Act, as applicable, and the rules and regulations of the SEC
with respect thereto as in effect at the time of filing.  Such
financial statements have been prepared in accordance with GAAP consistently
applied, during the periods involved (except (i) as may be otherwise indicated
in such financial statements or the notes thereto, or (ii) in the case of
unaudited interim statements, to the extent they may exclude footnotes) and
fairly present in all material respects the financial position of the Company
and the Subsidiary Borrowers as of the dates thereof and the results of their
operations and cash flows for the periods then ended (subject, in the case of
unaudited statements, to normal, immaterial, year-end audit
adjustments).

     

    (c)  Each
Independent Accounting Firm that has expressed its opinion with respect to the
consolidated financial statements included in the Company’s registration
statement on Form S-1, File No. 333-164871 (each opinion, an “Audit
Opinion”) is independent of the Company pursuant to the standards set
forth in Rule 2-01 of Regulation S-X promulgated by the SEC, and each such
Independent Public Accounting Firm was otherwise qualified to render their
respective Audit Opinion under the Securities Act and the Exchange Act, as
applicable.  In the event another accounting firm shall be engaged by
the Company subsequent to such filing to conduct a review or audit of any of the
Company’s consolidated financial statements, such other or additional accounting
firm will be independent of the Company pursuant to the standards set forth in
Rule 2-01 of Regulation S-X promulgated by the SEC and will be otherwise
qualified to conduct such review or audit and render an audit opinion under the
Securities Act or Exchange Act, as applicable.

     

    (d)  The
Company and all Subsidiary Borrowers have implemented and maintain a system of
“internal control over financial reporting” (as defined in Rules 13a-15(f) and
15d-15(f) of the Exchange Act) sufficient to provide reasonable assurances
regarding the reliability of financial reporting and the preparation of
financial statements in accordance with GAAP.  The Company (i) has
implemented and maintains “disclosure controls and procedures” (as defined in
Rule 13a-15(e) of the Exchange Act) that are designed to ensure that material
information relating to the Company, including the Subsidiary Borrowers, is made
known to the Chief Executive Officer and the Chief Financial Officer of the
Company by others within those entities and (ii) has disclosed, based on its
most recent evaluation prior to the Closing Date, to the Company’s outside
auditors and the Audit Committee of the Company’s Board of Directors (A) any
significant deficiencies and material weaknesses in the design or operation of
“internal control over financial reporting” that would be reasonably likely to
adversely affect the Company’s ability to record, process, summarize and report
financial information and (B) any fraud, whether or not material, that
involves management or other employees who have a significant role in the
Company’s “internal control over financial reporting.”

    
      
         

      

      
        53

        
          

        

      

      
         

      

    

    (e)  Since
May 4, 2007, (i) neither the Company nor any of the Subsidiary Borrowers or any
director, officer, employee, auditor, accountant or representative of the
Company or any of the Subsidiary Borrowers has received or otherwise had or
obtained knowledge of any material written complaint, allegation, assertion or
claim regarding the accounting or auditing practices, procedures, methodologies
or methods of the Company or any of the Subsidiary Borrowers or their respective
“internal control over financial reporting,” including any material complaint,
allegation, assertion or claim that the Company or any of the Subsidiary
Borrowers has engaged in questionable accounting or auditing practices and (ii)
no attorney representing the Company or any of the Subsidiary Borrowers, whether
or not employed by the Company or any of the Subsidiary Borrowers, has reported
to the Board of Directors or any committee thereof or to any officer or director
of the Company or any Subsidiary Borrower evidence of a material violation of
the Securities Act or Exchange Act or the rules promulgated thereunder, the
rules of the SEC, a breach of fiduciary duty or similar violation by the
Company, any of the Subsidiary Borrowers or any of their respective officers,
directors, employees or agents.

     

    (f)  No
Subsidiary Borrower is required to file any form, report, schedule, statement or
other document with the SEC.

     

    (g)  Neither
the Company nor any Subsidiary Borrower is a party to, or has entered into any
contract to become a party to, any joint venture, off-balance sheet partnership
or any similar contract or arrangement (including any transaction or
relationship between or among the Company or any Subsidiary Borrower, on the one
hand, and any unconsolidated affiliate, including any structured finance,
special purpose or limited purpose entity or person, on the other hand, or any
“off-balance sheet arrangements” (as defined in Item 303(a) of Regulation S-K of
the SEC), where the result, purpose or effect of such contract is to avoid
disclosure of any material transaction involving, or material liabilities of,
the Company or any of the Subsidiary Borrowers in any audited financial
statements or other reports filed with the SEC.

     

    Section
8   Affirmative
Covenants.

     

    Each
Borrower covenants jointly and severally that, except with the prior written
consent of Agent, so long as all or any portion of the Loans remains outstanding
and until Lenders’ commitments to lend hereunder have terminated:

     

    8.1          Items to be
Furnished.  Borrowers
shall cause the following to be furnished to each Lender at its respective
principal office, as designated by each Lender to Borrowers from time to
time:

    
      
         

      

      
        54

        
          

        

      

      
         

      

    

    (a)  Promptly
after preparation, and no later than one hundred twenty (120) days after the
last day of each fiscal year of Borrowers, (i) audited consolidated financial
statements (including balance sheets, statements of income, cash flows and
stockholders’ equity), and (ii) an unaudited consolidating balance sheet and an
unaudited consolidating statement of income detailing the statement of income
and balance sheet for each individual Borrower and the adjustments required to
eliminate any intercompany transactions, if applicable, key operating statistics
and a summary of accounting policies and detailed notes) showing the
consolidated financial condition and results of operations of the Borrowers as
of, and for the year ended on, that last day, accompanied by:

     

    (i)           the
unqualified opinion of Raich, Ende Malter LLC or another firm of independent
certified public accountants acceptable to Lenders (the “Accounting
Firm”), based on an audit using generally accepted auditing standards,
that the financial statements were prepared in accordance with GAAP and present
fairly, in all material respects, the consolidated financial condition and
results of operations of the Borrowers; and

     

    (ii)          a
Compliance Certificate with respect to such financial statements certifying (A)
as to the Borrowers’ compliance with the financial covenants set forth in Section 10
of this Agreement and (B) that such financial statements were prepared in
accordance with GAAP and present fairly, in all material respects, the
consolidated financial condition and results of operations of the
Borrowers.

     

    (b)  Commencing
with the calendar month ending February 28, 2011, promptly after preparation,
and no later than forty-five (45) days after the last day of each calendar month
of Borrowers, internally-certified unaudited financial statements (including
statements of income and cash flows, a balance sheet, a consolidating statement
of income and a consolidating balance sheet detailing the statement of income
and balance sheet for each individual Borrower and the adjustments required to
eliminate any intercompany transactions, if applicable, key operating statistics
and detailed notes) showing the consolidated financial condition and results of
operations of the Borrowers as of, and for the month-end and
year-to-date.

     

    (c)  Promptly
after preparation, and no later than forty-five (45) days after the last day of
each fiscal quarter of Borrowers, Borrowers shall deliver the following to
Lenders:

     

    (i)           internally-certified
unaudited financial statements (including statements of income and cash flows, a
balance sheet, a consolidating statement of income and a consolidating balance
sheet detailing the statement of income and balance sheet for each individual
Borrower and the adjustments required to eliminate any intercompany
transactions, if applicable, key operating statistics and detailed notes)
showing the consolidated financial condition and results of operations of the
Borrowers as of, and for the month-end and year-to-date;

     

    (ii)          a
management discussion and analysis that includes a discussion and explanation of
(A) the comparison of the Borrowers’ actual operating results to budget for such
fiscal quarter and for the year to date period then ended, (B) the comparison of
the Borrowers’ operating results for such fiscal quarter and for the year to
date period then ended to the corresponding periods in the prior year, (C) a
comparison of Borrowers’ operating results for such fiscal quarter to the
immediately preceding fiscal quarter, and (D) the Borrowers’ current financial
position in comparison to (I) the prior quarter, (II) the prior year-end, and
(III) the budget for such fiscal quarter then ended; and

    
      
         

      

      
        55

        
          

        

      

      
         

      

    

    (iii)          a
Compliance Certificate with respect to such financial statements certifying (A)
as to the Borrower’s compliance with the financial covenants set forth in Section 10
of this Agreement and (B) that such financial statements (I) were prepared
in accordance with GAAP and on a basis consistent with Borrowers’ historical
financial statements and (II) present fairly, in all material respects, the
consolidated financial condition and results of operations of the
Borrowers.

     

    (d)  Promptly
after preparation, and no later than the last day of January of each year
(assuming a fiscal year end of December 31), an annual operating plan (with a
level of detail consistent with the Projections) for Borrowers on a consolidated
and consolidating (by legal entity) basis, approved by the Board of Directors of
the Company, for the current fiscal year (if delivered in January of such year),
that (i) includes a statement of all of the material assumptions on which
such plan is based, (ii) includes budgeted monthly balance sheets, income
statements and statements of cash flows for such fiscal year, and, commencing in
2010, comparisons of such items to the corresponding months in the prior fiscal
year, and (iii) integrates sales, gross profits, operating expenses,
operating profit and cash flow projections, all prepared on the same basis and
in similar detail as that on which operating results are reported (and in the
case of cash flow projections, representing management’s good faith estimates of
future financial performance based on historical performance), and including
plans for personnel, Capital Expenditures and facilities.

     

    (e)  Promptly
after preparation, and no later than the earlier to occur of (i) ninety
(90) days after the end of each fiscal year of Borrowers or any extensions
approved by the Internal Revenue Service or any state taxing authorities, or
(ii) five (5) Business Days after Borrowers’ federal income tax return has been
filed, copies of each federal income tax return, Form K-1’s and related tax
reporting information for each Borrower for the prior fiscal year.

     

    (f)  Promptly
after receipt, a copy of each interim or special audit report and completed
management letter issued by independent accountants with respect to any Borrower
or its financial records.

     

    (g)  Notice,
promptly after any Borrower receives notice of, or otherwise becomes aware of,
(i) the institution of any Litigation involving any Borrower which, if
adversely determined, could reasonably be expected to result in a Material
Adverse Event, (ii) any other event which could reasonably be expected to
cause a Material Adverse Event, (iii) the obligation of any Borrower to remedy
any violation of Environmental and Safety Law, (iv) any liability or alleged
liability under any Environmental and Safety Law arising out of, or directly
affecting, the properties or operations of such Borrower, (v) any violation or
alleged violation by any Borrower of ERISA or any Law with respect to an
Employee Plan, or (vi)  any Default or Potential Default, specifying the
nature thereof and what action each Borrower has taken and is taking or proposes
to take.

    
      
         

      

      
        56

        
          

        

      

      
         

      

    

    (h)  Promptly
upon reasonable request by any Lender, information and documents not otherwise
required to be furnished under the Loan Documents respecting the business
affairs, assets and liabilities of the Borrowers.

     

    8.2          Books and
Records.  Each
Borrower shall maintain books, records, and accounts necessary to prepare the
financial statements required by Section
8.1.

     

    8.3          Inspections.  Upon
reasonable notice, each Borrower shall allow Agent or any Lender (or its
Representatives) during business hours or at other reasonable times to inspect
any of its properties, to review reports, files, books, accounts and other
records, to make and take away copies, and, to discuss, from time to time, any
of such Borrower’s affairs, conditions and finances with its directors,
managers, officers, and certified public accountants.

     

    8.4          Taxes.  Each
Borrower will promptly pay and discharge when due any and all of its Taxes,
other than Taxes that
are being contested in good faith by lawful proceedings diligently conducted,
against which reserves or other provisions required by GAAP have been made, and
in respect of which levy and execution of any Lien are stayed.  Each
Borrower will file all Tax returns that it is required to file, and if any
Borrower becomes aware that it has failed to timely file any Tax return, such
Borrower shall promptly file such Tax return and pay and discharge any
delinquent Taxes associated therewith.

     

    8.5          Payment of Obligations and
Compliance with Contracts.  Each
Borrower (i) will pay and perform all of the Obligations as the same become
due in the ordinary course of its business and are payable or enforceable and
(ii) will promptly pay and perform (or renew and extend) all of its other
material obligations as they become due (unless such obligations are being
contested in good faith by lawful proceedings diligently conducted, against
which reserves or other provisions required by GAAP have been
made).  Each Borrower will use its best efforts to comply with the
terms of, and to perform its obligations under, the Loan Documents and each
contract with its customers.

     

    8.6          Indemnification.

     

    (a)  Each
Borrower agrees to indemnify, defend, and hold harmless each Indemnified Party
(as defined herein) from and against (and will reimburse each Indemnified Party
as the same are incurred) all Claims arising out of or in connection with or by
reason of (including, without limitation, in connection with any investigation,
Litigation or proceeding or preparation of a defense in connection therewith)
(i) The Loans, the Loan Documents or any of the transactions contemplated
by the Loan Documents, (ii) The Culinary Group Acquisition, the Culinary
Group Purchase Agreements or any of the transactions contemplated by the
Culinary Group Purchase Agreements, (iii) the actual or proposed use of the
proceeds of the Loans, (iv) any act arising out of or in connection with Agent’s
or any Lender’s representation on, or visitation and observer rights with
respect to, the Board of Directors of any Borrower (to the maximum extent
permitted by applicable Law), (v) the direct or indirect result of the violation
by any Borrower of any Environmental and Safety Law, (vi) any Borrower’s
generation, manufacture, production, storage, release, threatened release,
discharge, disposal or presence of a Hazardous Substance at, to or from any of
its properties, (vii) any personal injury to Agent’s, any Lender’s or any
Borrower’s respective Representatives, invitees, or licensees, and (viii) any
damage to any Borrower’s assets.

    
      
         

      

      
        57

        
          

        

      

      
         

      

    

    (b)  Borrowers
agree not to assert any Claim against any Indemnified Party on any theory of
liability for special, indirect, consequential, or punitive damages arising out
of or otherwise relating to the Loan Documents, any of the transactions
contemplated by the Loan Documents or the actual or proposed use of the proceeds
of the Loans.

     

    (c)  Each
Indemnified Party shall be indemnified under the terms of the Loan Documents for
its own ordinary negligence; however, no Borrower is obligated to indemnify any
Indemnified Party under the Loan Documents to the extent a Claim is found in a
final, non-appealable judgment by a court of competent jurisdiction to have
resulted primarily from any Indemnified Party’s gross negligence or willful
misconduct.

     

    (d)  For
purposes of this Section, (i) “Indemnified Party” means each Lender and Agent
and their respective Affiliates, partners, officers, members or other
equityholders, managers, directors, employees, agents, representatives,
advisors, successors and assigns, and (ii)  “Claim” means any and all
claims, damages, losses, liabilities, penalties, costs, obligations, actions,
judgments, Litigation, investigations, orders and expenses (including, without
limitation, reasonable attorneys’ and paralegal fees and expenses, whether or
not suit is filed) incurred by, asserted against, or awarded against any
Indemnified Party.

     

    (e)  in the case
of any investigation, litigation or proceeding to which the indemnity provided
for in this Section
8.6 applies,
such indemnity shall be effective whether or not such investigation, litigation
or proceeding is brought by any Borrower, any Borrower’s Equityholders or
creditors or any Indemnified Party and whether or not the Loans are consummated
or, if consummated, have been repaid.  Each Borrower agrees that no
Indemnified Party shall have any liability to any Borrower or any Borrower’s
Subsidiaries or Affiliates or to any Borrower’s Equityholders or creditors or
the Equityholders or creditors of any Borrower’s Subsidiaries for any indirect
or consequential damages arising out of, related to or in conjunction with the
Loans, the Culinary Group Acquisition, the Culinary Group Purchase Agreements or
any Loan Documents.

    
      
         

      

      
        58

        
          

        

      

      
         

      

    

    (f)  All
covenants, agreements, representations and warranties made in this Agreement
shall survive and continue in effect after the Closing Date.  The
indemnity set out in this Section and its terms and provisions shall survive the
satisfaction and payment of the Obligations and the termination of this
Agreement and the other Loan Documents.

     

    (g)  Amounts
payable under this Section shall be a part of the Obligations and, if not paid
upon demand, shall bear interest at the Default Rate until
paid.

     

    8.7          Maintenance of Existence,
Assets, and Business.  Except
as otherwise permitted by Section
9.6, each Borrower will (a) preserve and maintain its existence and
good standing in its jurisdiction of organization and its authority to transact
business and good standing in all other jurisdictions where the nature and
extent of its business and properties require due qualification and good
standing; (b) maintain all licenses, permits and franchises necessary for
its business where failure to do so is a Material Adverse Event; and
(c) keep all of its assets that are useful in and necessary to its business
in good working order and condition (ordinary wear and tear excepted) and make
all necessary repairs and replacements.  Each Borrower shall (i)
perform all of such Borrower’s duties under and in connection with each
transaction to which any of its accounts receivable, accounts, or contracts
relates, so that the amounts thereof (net of any reserves established in the
ordinary course of business in respect of such accounts receivable, accounts, or
contracts) shall actually become payable in their entirety to such Borrower,
(ii) maintain and store all its inventory with reasonable care, skill, and
caution and repair and otherwise keep the same in good condition, and
(iii) not relocate such Borrower’s chief executive office (or the location
of such Borrower’s books and records related to accounts) or any of such
Borrower’s inventory, to a county, parish, or state other than those listed on
Schedule
7.13 unless such Borrower gives Lenders thirty (30) days prior written
notice of such proposed relocation (such notice to include the address with the
name of the county or parish and state of the new location).

     

    8.8          Insurance.

     

    (a)  Borrowers
shall maintain insurance with financially sound, responsible and reputable
insurance companies or associations (or, as to workers’ compensation or similar
insurance, with an insurance fund or by self insurance authorized by the
jurisdictions in which it operates) in such amounts and against such risks as is
(i) required by all applicable Laws, (ii) customarily maintained by similar
businesses operating in the same geographic region, and (iii) with respect
to the Collateral, reasonably acceptable to Agent.

     

    (b)  At
a minimum, Borrowers’ insurance must include (i) the Key Man Life Insurance;
provided, that
Borrowers shall have up to 120 days following the Closing to obtain the
Key Man Life Insurance, (ii) business interruption insurance, (iii) fire,
property damage and extended coverage insurance covering all assets and naming
Agent as mortgagee or loss payee, as applicable, (iv) workers compensation
insurance and (v) public liability insurance naming Agent as an additional
insured as its interest may appear, and, with respect to each such insurance
policy, providing for at least thirty (30) days prior notice to Agent of any
cancellation thereof.  Satisfactory evidence of such insurance must be
supplied to Agent on the Closing Date and at least five (5) days prior to each
policy renewal at Agent’s request.  All such insurance policies shall
be primary, and not excess or contributory, to any policies of insurance that
are maintained by Lenders.

    
      
         

      

      
        59

        
          

        

      

      
         

      

    

    (c)  With
regard to workers’ compensation insurance, nothing contained in this Section
8.8 shall prohibit Borrowers from becoming a non-subscriber with the
prior written consent of Agent.

     

    (d)  Unless
the Borrowers provide Agent with evidence of the continuing insurance coverage
required by this Agreement, Agent may purchase insurance at the Borrowers’
expense to protect Agent’s interests in the Collateral.  This
insurance may, but need not, protect the Borrowers’ interests.  The
coverage that Agent purchases may, but need not, pay any claim that is made
against any Borrower in connection with the Collateral.  Borrowers may
later cancel any insurance purchased by Agent, but only after providing Agent
with evidence that Borrowers have obtained the insurance coverage required by
this Agreement.  If Agent purchases insurance for the Collateral as
set forth above, Borrowers will be responsible for the costs of that insurance,
including interest and any other charges that may be imposed with the placement
of the insurance, until the effective date of the cancellation or expiration of
the insurance, and the costs of the insurance may be added to the principal
amount of the Loans owing hereunder.

     

    8.9          Further
Assurances.

     

    (a)  Each
Borrower shall cause each of its Subsidiaries created or acquired after the
Closing Date, within five (5) days of such Subsidiary’s creation or acquisition
by such Borrower, to execute and deliver to Agent and Lenders a joinder to this
Agreement, substantially in the form of Exhibit N
hereto, agreeing to become a Borrower under this Agreement, a “Debtor” under the
Security Agreement and a “Maker” under the Notes (a “Joinder
Agreement”).

     

    (b)  Each
Borrower shall take such action as Agent or any Lender may reasonably request to
carry out more effectively the terms of Section 6
and all other terms of the Loan Documents, including executing,
acknowledging, delivering and recording or filing additional instruments or
documents.  Each Borrower will promptly execute and deliver, or cause
the execution and delivery of, all applications, certificates, instruments,
registration statements and all other documents and papers Agent or any Lender
reasonably requests in connection with the obtaining of any consent, approval,
registration, qualification, permit, license or authorization of any
Governmental Authority or other Person necessary or appropriate for the
effective exercise of any rights under the Loan Documents.  Because
Borrowers agree that Agent’s and the Lenders’ remedies at Law for failure of
Borrowers to comply with the provisions of this section would be inadequate and
that failure would not be adequately compensable in damages, Borrowers agree
that the covenants of this Section 8.9
may be specifically enforced.

    
      
         

      

      
        60

        
          

        

      

      
         

      

    

    (c)  Within
sixty (60) days following the Closing Date, Borrowers shall execute and deliver
the ACH Authorization Agreements to Lenders in accordance with Section
3.2(d).

     

    (d)  Within
90 days following the Closing Date, Borrowers shall deliver to Agent a duly
executed Deposit Account Control Agreement with respect to all of Borrowers’
bank accounts and other similar accounts.

     

    (e)  Within
120 days following the Closing Date, unless waived in writing by Agent, the
Company shall:

     

    (i)           obtain
the Key Man Life Insurance and deliver proof of the same to Agent;
and

     

    (ii)          deliver
the Landlord Subordination of Lien with respect to Borrowers’ leased real
property.

     

    8.10        Compliance with
Laws.  Except
where non-compliance would not constitute a Material Adverse Event, each
Borrower shall conduct its business so as to comply with all applicable Laws
(including all applicable Environmental and Safety Laws), and shall promptly
take corrective action to remedy any violation of any Law (including any
Environmental and Safety Law of which it is aware), and shall immediately notify
Lender of any claims or demands by any Governmental Authority or Person with
respect to any Law (including any Environmental and Safety Law) or Hazardous
Substance.

     

    8.11        Expenses.  In
addition to the pre-closing out-of-pocket expenses set forth in the Commitment
Letter and the fees set forth in Section 4,
Borrowers shall promptly pay upon demand (a) all reasonable costs, fees and
expenses paid or incurred by Agent or any Lender in connection with the
arrangement, syndication and negotiation of the credit facilities evidenced by
the Loan Documents and the negotiation, preparation, delivery and execution of
the Loan Documents (including those incurred under Section 6)
and any related or subsequent amendment, waiver, or consent (including in each
case, without limitation, the reasonable fees and expenses of Agent’s and each
Lender’s counsel), (b) all reasonable due diligence, closing, and
post-closing costs including filing fees, recording costs, lien searches,
corporate due diligence, third-party expenses, appraisals, title insurance,
environmental surveys, and other related due diligence, closing and post-closing
costs and expenses, (c) all costs, fees and expenses of Agent and each Lender
incurred in connection with the interpretation and enforcement of the
Obligations of the Borrowers arising under the Loan Documents or the exercise of
any rights arising under the Loan Documents (including without limitation,
reasonable attorneys’ fees, expenses and costs paid or incurred in connection
with any negotiation, workout, or restructure and any action taken in connection
with any Debtor Relief Laws), (d) all costs, fees and expenses incurred by Agent
and each Lender or any of their respective designees in the exercise of their
visitation and observer rights with respect to the Board of Directors of any
Borrower as specified in Section
8.14, and (e) all stamp or other similar documentary or recording Taxes
which may be payable in connection with this Agreement and the other Loan
Documents or the performance of any transactions contemplated hereby or thereby,
all of which shall be a part of the Obligations and shall accrue interest, if
not paid upon demand, at the Default Rate until repaid.  All
Obligations provided for in this Section 8.11
shall survive repayment of the Loans, cancellation of the Notes and termination
of this Agreement.

    
      
         

      

      
        61

        
          

        

      

      
         

      

    

    8.12        Application of Insurance
Proceeds, Eminent Domain, Proceeds and Conditions to
Disbursement.

     

    (a)  Agent,
Lenders and each Borrower agree that all Insurance Proceeds shall, except as
otherwise provided in subsections (b) and (c) below, be paid by the
insurers directly to Agent (as loss payee or additional insured, as applicable)
for the ratable benefit of the Lenders.  Each Borrower shall cause all
Eminent Domain Proceeds to be paid by the condemning Governmental Authority
directly to Agent for the ratable benefit of the Lenders.  Except as
otherwise provided in subsections (b) and (c) below, if any Insurance
Proceeds or Eminent Domain Proceeds are paid to any Borrower, such Insurance
Proceeds or Eminent Domain Proceeds shall be received only in trust for Agent,
shall be segregated from other funds of the Borrowers and shall promptly be paid
over to Agent in the same form as received (with any necessary
endorsement).

     

    (b)  Unless
a Default exists, any business interruption insurance proceeds received by Agent
shall be paid to Borrowers.

     

    (c)  If
the loss, damage or destruction of any asset of any Borrower with respect to
which Insurance Proceeds payable for any single loss does not exceed $100,000,
such Insurance Proceeds shall be paid to Borrowers and applied to the payment of
the cost of the repair or restoration of such loss, damage or destruction, which
repair or restoration shall be undertaken promptly by such Borrower and
completed within a commercially reasonable time period.

     

    (d)  Agent,
Lenders and each Borrower agree that, to the extent not prohibited by applicable
Law and subject to Section 3.3,
all Insurance Proceeds and all Eminent Domain Proceeds received by Agent (or
which Agent is entitled to receive) shall be applied in accordance with Section 2.3(b).

     

    8.13        Use of
Proceeds.  Borrowers
shall use the proceeds of the Loans only for the purposes represented in Section 7.14
or otherwise in this Agreement.

     

    8.14        Board of Directors.  For
so long as all or any portion of the Loans or any other Obligation remains
outstanding and until Lenders’ commitments to lend hereunder have
terminated:

     

    (a)  Lender
shall have the right to designate one (1) representative of Lender (the “Lender
Observer”) to attend all meetings of the Board of Directors (and all
committees thereof) of each Borrower as a non-voting observer.

     

    (b)  The
Borrowers shall (i) give the Lender Observer notice, at the same time as
furnished to the Directors, of all meetings of the Board of Directors (or any
committee thereof) of each Borrower, (ii) provide to the Lender Observer all
notices, documents and information furnished to the Directors of each Borrower
whether at or in anticipation of a meeting, an action by written consents or
otherwise, at the same time as furnished to the Directors, (iii) notify the
Lender Observer by telephone of, and permit the Lender Observer to attend by
telephone, emergency meetings of the Board of Directors (and all committees
thereof) of each Borrower, and (iv) provide the Lender Observer copies of the
minutes of all such meetings at the time such minutes are furnished to the
Directors of any Borrower;

    
      
         

      

      
        62

        
          

        

      

      
         

      

    

    (c)  The
Lender Observer will be reimbursed for his or her reasonable out of pocket
expenses incurred in connection with his or her rights under this Section
8.14; and

     

    (d)  At
a minimum, the Board of Directors of the Company shall meet within forty-five
(45) days after the end of each calendar quarter.  The meetings of the
Board of Directors may be held in person or telephonically; provided, that at least one
(1) meeting of the Board of Directors of the Company shall be held in person in
each fiscal year of the Borrowers.

     

    8.15        Special SBIC
Covenants.

     

    (a)  On
the date hereof and for the one year period hereafter, Borrowers hereby covenant
and agree that at least fifty-one percent (51%) of the employees of each
Borrower are and will remain located within the United States and at least
fifty-one percent (51%) of the tangible assets of each Borrower are and will
remain located within the United States.

     

    (b)  The
proceeds of the Loans shall only be used for specific domestic purposes within
the United States including, for example, payroll for employees located within
the United States or acquiring assets for use solely in the United
States.

     

    (c)  Borrowers
shall within five (5) Business Days after the end of each fiscal quarter of
Borrowers, or upon any Lender’s request, provide to such Lender a written
certificate, signed by the chief executive officer or the chief financial
officer of the Company, stating that Borrowers are in compliance with the
covenants described above in subsections (a) and (b) and describing in
reasonable detail the use of the proceeds received from the Loans by
Borrowers.

     

    (d)  Borrowers
shall notify Lenders (i) at least fifteen (15) days prior to taking any action
after which the number of record holders of any Borrower’s voting securities
would be increased from fewer than fifty (50) to fifty (50) or more, and (ii) of
any other action or occurrence after which the number of record holders of any
Borrower’s voting securities was increased (or would increase) from fewer than
fifty (50) to fifty (50) or more, as soon as practicable after Borrowers become
aware that such other action or occurrence has occurred or is proposed to
occur.  Each Borrower shall at all times comply with the
non-discrimination requirements of 13 C.F.R. Parts 112, 113 and
117.

    
      
         

      

      
        63

        
          

        

      

      
         

      

    

    (e)  Within
forty-five (45) days after the end of each calendar year and at such other times
as any Lender may reasonably request, Borrowers shall deliver to Lenders a
written assessment, in form and substance reasonably satisfactory to Lenders, in
order to permit Lenders to file SBA Form 468, of the economic impact of Lenders’
financing specifying the full-time equivalent jobs created or retained in
connection with such investment, and the impact of the financing on Borrowers’
businesses in terms of profits and on taxes paid by Borrowers and their
employees.  Upon request, Borrowers shall promptly (and in any event
within twenty (20) days of such request) furnish to Lenders all information
reasonably requested by Lenders in order for Lenders to comply with the
requirements of 13 C.F.R. Section 107.620 or to prepare and file SBA Form 468
and any other information requested or required by the SBA or any other similar
Governmental Authority asserting jurisdiction over a
Lender.  Borrowers shall afford to representatives of the SBA
reasonable access to their books, records and properties in accordance with 13
C.F.R. Section 107.620(c).  Any submission of any financial
information under this paragraph shall include a certificate of the Company’s
president, chief executive officer, treasurer or chief financial
officer.

     

    (f)  Upon
the occurrence of a Regulatory Problem or in the event any Lender determines in
its good faith judgment that a Regulatory Problem has occurred, in addition to
any other rights and remedies to which it may be entitled hereunder, such Lender
shall have the right to the extent required under the SBIC Regulations to demand
the immediate repayment of all of the outstanding Obligations owed to Lenders,
including all accrued interest thereon, by delivering written notice of such
demand to Borrowers.  Borrowers shall make such repayment by wire
transfer of immediately available funds to Lenders within thirty (30) days after
any Borrower’s receipt of the demand notice.

     

    (g)  In
the event that any Lender determines in its good faith judgment that it has a
Regulatory Problem, such Lender shall have the right to transfer its rights and
obligations hereunder, without regard to any restrictions on transfer set forth
herein or in any other agreement (including without limitation, the Warrants),
and Borrowers shall take all such actions as are reasonably requested by such
Lender in order to (i) effectuate and facilitate any transfer by such Lender to
any permitted Person designated by such Lender, and (ii) cooperate with such
Lender in connection with other regulatory matters.  Such cooperation
shall include cooperation in making any required filings with any Governmental
Authority, including the filing of a certificate or plan of
divestiture.

     

    (h)  Borrowers
shall comply with the Small Business Side Letter.

     

    Section
9   Negative
Covenants.

     

    Each
Borrower covenants jointly and severally that, except with the prior written
consent of Agent, for so long as all or any portion of the Loans remains
outstanding and until Lenders’ commitments to lend hereunder have
terminated:

     

    9.1          Debt.  No
Borrower may create, incur, assume, guarantee or be or remain liable for,
contingently or otherwise, or suffer to exist any Debt, except Permitted
Debt.

    
      
         

      

      
        64

        
          

        

      

      
         

      

    

    9.2          Liens.  No
Borrower may create, assume, incur or suffer to be created any Lien upon any of
its now owned or hereafter acquired assets (including any other Borrower’s
Equity Securities that are owned by such Borrower), except Permitted
Liens.

     

    9.3          Compliance with Laws and
Documents.  No
Borrower may violate the provisions of any Laws applicable to it, any agreement
to which it is a party, or the provisions of its organizational documents, if
such violations individually or collectively could reasonably be expected to
cause a Material Adverse Event.

     

    9.4          Loans, Advances, and
Investments.  No
Borrower may (i) make any loan, advance, extension of credit (other than in the
ordinary course of business), or capital contribution to, (ii) make any
investment in, or purchase or commit to purchase any stock or other securities
of or interests in, or (iii) enter into any joint venture, partnership, or other
similar arrangement with, any Person, other than

     

    (a)  Permitted
Acquisitions;

     

    (b)  Permitted
Debt;

     

    (c)  marketable
obligations issued or unconditionally guaranteed by the United States government
or issued by any of its agencies and backed by the full faith and credit of the
United States of America (and investments in mutual funds investing primarily in
those obligations);

     

    (d)  marketable
obligations issued by any state of the United States of America or any political
subdivision of any such state or any public instrumentality thereof and rated
“Aa2” or better by Moody’s or “AA” by S&P (and investments in mutual funds
investing primarily in those obligations);

     

    (e)  certificates
of deposit or banker’s acceptances that are fully insured by the Federal Deposit
Insurance Corporation or are issued by commercial banks having combined capital,
surplus, and undivided profits of not less than $250,000,000 (as shown on its
most recently published statement of condition (and investments in mutual funds
investing primarily in those certificates of deposit or banker’s
acceptances));

     

    (f)  commercial
paper and similar obligations rated “P-2” or better by Moody’s, or
“A-2” or better by
S&P (and investments in mutual funds investing primarily in those
obligations);

     

    (g)  checking
and demand deposit accounts maintained in the ordinary course of business
(provided an executed Deposit Account Control Agreement has been delivered to
Lenders in Proper Form);

     

    (h)  expense
accounts or loans or advances to its directors, managers, officers or employees
in the ordinary course of business which may not, in the aggregate, at any time
exceed $100,000;

    
      
         

      

      
        65

        
          

        

      

      
         

      

    

    (i)  investments
in securities purchased by any Borrower under repurchase
obligations pursuant to which arrangements are made with selling financial
institutions (being a financial institution having unimpaired capital and
surplus of not less than $500,000,000 and with a rating of “A-1” by S&P or “P-1” by Moody’s) for such
financial institutions to repurchase such securities within thirty (30) days
from the date of purchase by such Borrower, and other similar short term
investments made in connection with the Borrower’s cash management
practices;

     

    (j)  non-cash
proceeds from dispositions permitted under Section
9.9;

     

    (k)  investments
by any Borrower in any other Borrower;

     

    (l)  cash
and Cash Equivalents;

     

    (m)  prepaid
expenses incurred in the ordinary course of business; and

     

    (n)  accounts
receivable created in the ordinary course of business.

     

    9.5          Distributions.  No
Borrower may declare, make, or pay any Distribution, other than (a) dividends
declared, made or paid by such Borrower wholly in the form of its Equity
Securities,  and (b) dividends or intercompany loans by one
Borrower to another Borrower.

     

    9.6          Acquisitions,
Mergers and
Dissolutions.

     

    (a)  Except
as provided in this Section
9.6, no Borrower may (i) acquire all or any substantial portion of
the stock issued by, equity or other interest in, or assets of, any other
Person, (ii) merge or consolidate with any other Person, (iii) liquidate, wind
up or dissolve (or suffer any liquidation or dissolution), or (iv) create or
acquire any Subsidiaries.

     

    (b)  Notwithstanding
the foregoing, any Borrower may merge or consolidate with or acquire the stock
issued by, an interest in, or the assets of, another Borrower (and, in the case
of such merger or consolidation or, in the case of the conveyance or
distribution of all of such assets, the non-surviving or selling entity, as the
case may be, may be liquidated, wound up or dissolved); provided, that if the Company
is a party to such transaction, the Company must be the surviving
entity.

     

    (c)  Notwithstanding
the foregoing, the Company may consummate the Culinary Group
Acquisition.

     

    9.7          Assignment.  No
Borrower may assign or transfer any of its rights, duties, or Obligations under
any of the Loan Documents.

     

    9.8          Fiscal Year and Accounting
Methods.  No
Borrower may change its fiscal year or its method of accounting (other than immaterial changes
in methods or as required by GAAP).

    
      
         

      

      
        66

        
          

        

      

      
         

      

    

    9.9          Sale of
Assets.  No
Borrower may sell, assign, lease, transfer, or otherwise dispose of any of its
assets, other than (a)
sales of inventory in the ordinary course of business, (b) the sale, discount,
or transfer of its delinquent accounts receivable in the ordinary course of
business for purposes of collection, (c) dispositions of assets from one
Borrower to another, (d) occasional dispositions of immaterial assets for
consideration not less than fair market value, and dispositions of assets that
are worn-out, surplus or obsolete, and (e) to the extent permitted by Section
9.6.  All dispositions by a Borrower of its assets, whether or
not permitted by this Section
9.9, are subject to Section 2.5.  All
Net Proceeds shall be cash Net Proceeds unless approved by Agent in
advance.  The non-cash portion of all Net Proceeds shall be pledged to
Agent as Collateral concurrently with the applicable disposition.

     

    9.10        New
Businesses.  No
Borrower may engage in any business except (a) the Business, and
(b) any Business or other business acquired in connection with a Permitted
Acquisition.

     

    9.11        Employee
Plans.  No
Borrower may permit any events or circumstances described in Section
7.15 to occur.

     

    9.12        Transactions with
Affiliates.  Except
for (a) the Noncompetition Letter Agreements and the documents and agreements
referenced therein, (b) employment agreements between the Company and each of
Monaco and Kaplan, (c) transactions and agreements as otherwise referred to and
disclosed in the SEC Documents, and (d) compensation increases to employees of
the Borrowers in the ordinary course of the Business, no Borrower may enter into
any material transaction with any of its or any other Borrower’s officers,
directors, managers, employees, Equityholders or any of their respective
Affiliates other than transactions in the ordinary course of business which are
(a) disclosed in advance to Lenders and (b) upon fair and reasonable terms not
materially less favorable than such Borrower could obtain or could become
entitled to in an arm’s-length transaction with a Person that is not one of such
Borrower’s officers, directors, managers, employees, Equityholders or
Affiliates.  For purposes of this section, a transaction or series of
transactions, in the aggregate, is “material” if it requires any Borrower to pay
or provide products or services of more than $100,000 during the term of the
agreement covering such transaction.

     

    9.13        Taxes.  No
Borrower may use any portion of the proceeds of the Loans to pay the wages of
employees, unless a timely payment to or deposit with the appropriate
Governmental Authority of all amounts of Tax required to be deducted and
withheld with respect to such wages is also made.

     

    9.14        Prepayment of Debt;
Subordinated Debt.

     

    (a)  No
Borrower may voluntarily prepay, redeem, defease, repurchase, acquire for value
or make any sinking fund payment or other voluntary or optional payment with
respect to any principal of, or interest on, any Debt other than the
Obligations.

     

    (b)  Except
as expressly permitted by the applicable Subordination Agreement, no Borrower
may pay, prepay, redeem, defease, repurchase, acquire for value or make any
sinking fund payment or other payment (including scheduled and required
payments) with respect to any Subordinated Debt without the prior written
consent of Lender.

    
      
         

      

      
        67

        
          

        

      

      
         

      

    

    (c)  Notwithstanding
anything in this Section 9.14
to the contrary, the Company may make (A) the Valley Note Permitted
Prepayment and (B) the following additional payments to the Valley Seller under
the Valley Note and the Valley Purchase Agreement; provided, that no Default
exists or would result from such payments under this terms of this Agreement
(collectively, “Valley Permitted
Payments”):

     

    (iii)         commencing
in June 2011, regularly scheduled installment payments of principal and interest
under the Valley Note;

     

    (iv)         the
Valley Earn-Out Payments; and

     

    (v)          a
payment or prepayment of the Valley Note using up to eighty percent (80%) of the
Net Proceeds of any issuance of Equity Securities by Borrowers following the
Closing Date.

     

    9.15        Lease
Obligations.  No
Borrower shall enter into any lease arrangement for real or personal property
(unless capitalized and permitted under Section
9.16) if, after giving effect thereto, the aggregate amount of all rental
and other payments under such lease and all other leases of Borrowers then in
effect would exceed for any fiscal year an amount equal to $600,000, unless
otherwise approved in writing in advance by Agent.

     

    9.16        Capital
Expenditures.  No
Borrower shall make or incur any Capital Expenditures if, after giving effect
thereto, the aggregate amount of all Capital Expenditures made by Borrowers in
each of the following calendar years would exceed the following amounts: (a)
2010 - $150,000; (b) 2011 - $300,000; (c) 2012 and 2013 - $300,000; and (d) in
each of 2014 and 2015 - $200,000.   Up to fifty percent (50%) of
any unused Capital Expenditure in any one calendar year may be carried over to
the next immediately succeeding calendar year.

     

    9.17        Available
Cash.  The
aggregate cash available in Borrowers’ deposit accounts shall not be less than
$100,000 at any time.

     

    9.18        Amendments or Changes in
Agreements.  No
Borrower shall enter into an agreement or document after the Closing Date or
modify, alter, supplement, extend, amend or waive any of its rights under any
current agreement or document including, without limitation, its respective
organizational documents, in a manner that (a) is materially adverse to any
Lender; (b) affects or diminishes the rights of any Lender as an
Equityholder of any Borrower in any manner different from the rights of other
Equityholders of such Borrower, (c) diminishes Agent’s or any Lender’s rights
granted hereunder or under any other Loan Document; or (d) otherwise violates
the terms of this Agreement.

     

    9.19        Allocation of
Consideration.  No
Borrower shall take any action in preparation of its Tax returns or financial
statements that is inconsistent with the allocation of the consideration paid by
Lenders for the Deerpath Shares and the Deerpath Warrant, as set forth in the
Investor Rights Agreement.

     

    9.20        Compensation.  Except
as set forth on Schedule
9.20, Borrowers shall not increase the compensation paid to any
Management Person, including but not limited to salaries, bonuses or other forms
of compensation, without the prior written approval of the Agent and provided
that no Default or Potential Default exists or would result from such
increase.

    
      
         

      

      
        68

        
          

        

      

      
         

      

    

    9.21        Bank
Accounts.  No
Borrower shall open any new bank account without the written consent of Agent,
such consent not to be unreasonably withheld, and without the execution and
delivery of a Deposit Account Control Agreement relating to such account(s) to
Agent in Proper Form.

     

    9.22        Negative
Pledge.

     

    (a)           No
Borrower will, or permit any Subsidiary to, create, incur, assume or suffer to
exist any contract, agreement or understanding (other than this Agreement and
the other Loan Documents) which in any way prohibits or restricts the granting,
conveying, creation or imposition of any Lien on any of its property in favor of
Agent and Lender to secure the Obligations or which restricts any Borrower or
any Subsidiary from paying dividends or making distributions to the Company or
any other Borrower, or which requires the consent of or notice to other Persons
in connection therewith.

     

    (b)           No
Borrower will create, incur, assume or suffer to exist any Lien on the Equity
Securities of any Borrower other than the Company, except for Liens in favor of
Agent.

     

    Section
10  Financial
Covenants.

     

    Borrowers
jointly and severally covenant that, except with the prior written consent of
Agent, so long as all or any portion of the Loans remains outstanding, they
shall comply on a consolidated basis with the following financial covenants;
provided, that each of
the financial covenant tests set forth below (a) shall be calculated based on
the trailing twelve (12) month period, (b) for 2010, shall give pro-forma effect
to the add-backs and adjustments included in the definition of EBITDA, and (c)
in the case of the period in which the Culinary Group Acquisition or any
Permitted Acquisition occurs, shall be calculated on a pro-forma basis as if the
Culinary Group Sellers or such Permitted Acquisition, as applicable, were owned
by the Company as at the first day of such period:

     

    10.1        Minimum
EBITDA.  Borrowers’
EBITDA for the most recently completed 12-month period shall not at any time be
less than the amount set forth below for the applicable period:

     

    
      
        
          
            	
                    (a)  Closing
      Date through December 31, 2010

                  	 	$	1,050,000	 
	 
      	 	 	 	 
	
                    (b)  January
      1, 2011 through December 31, 2011

                  	 	$	1,250,000	 
	 
      	 	 	 	 
	
                    (c)  January
      1, 2012 through December 31, 2012

                  	 	$	1,600,000	 
	 
      	 	 	 	 
	
                    (d)  January
      1, 2013 through December 31, 2013

                  	 	$	2,100,000	 
	 
      	 	 	 	 
	
                    (e)  January
      1, 2014 through December 31, 2014

                  	 	$	2,400,000	 
	 
      	 	 	 	 
	
                    (f)  Thereafter

                  	 	$	2,400,000	 

          

        

      

    

    
      
         

      

      
        69

        
          

        

      

      
         

      

    

     

    10.2        Senior Debt to EBITDA
Ratio.  The
Senior Debt to EBITDA Ratio may not at any time exceed the ratio set out below
for the applicable period:

     

    
      
        
          	
                  (a)  Closing
      Date through December 31, 2010

                	
                  3.00
      to 1.00

                
	 
      	 
      
	
                  (b)  January
      1, 2011 through December 31, 2011

                	
                  2.25
      to 1.00

                
	 
      	 
      
	
                  (c)  January
      1, 2012 through December 31, 2012

                	
                  1.75
      to 1.00

                
	 
      	 
      
	
                  (d)  January
      1, 2013 through December 31, 2013

                	
                  1.00
      to 1.00

                
	 
      	 
      
	
                  (e)  Thereafter

                	
                  0.75
      to 1.00

                

        

      

    

      

    10.3        Funded Debt to EBITDA
Ratio.  The
Funded Debt to EBITDA Ratio may not at any time exceed the ratio set out below
for the applicable period:

     

    
      
        
          	
                  (a)  December
      31, 2010

                	
                  4.75
      to 1.00

                
	 
      	 
      
	
                  (b)  January
      1, 2011 through December 31, 2011

                	
                  3.75
      to 1.00

                
	 
      	 
      
	
                  (c)  January
      1, 2012 through December 31, 2012

                	
                  2.50
      to 1.00

                
	 
      	 
      
	
                  (d)  January
      1, 2013 through December 31, 2013

                	
                  1.50
      to 1.00

                
	 
      	 
      
	
                  (e)  Thereafter

                	
                  1.00
      to 1.00

                

        

      

    

     

    10.4        Fixed Charge Coverage
Ratio.  The
Fixed Charge Coverage Ratio may not at any time be less than the ratio set out
below for the applicable period:

     

    
      
        
          	
                  (a)  Closing
      Date through December 31, 2010

                	
                  1.25
      to 1.00

                
	 
      	 
      
	
                  (b)  January
      1, 2011 through December 31, 2011

                	
                  1.00
      to 1.00

                
	 
      	 
      
	
                  (c)  January
      1, 2012 through December 31, 2012

                	
                  1.00
      to 1.00

                
	 
      	 
      
	
                  (d)  January
      1, 2013 through December 31, 2013

                	
                  1.00
      to 1.00

                
	 
      	 
      
	
                  (e)  January
      1, 2014 through December 31, 2014

                	
                  1.10
      to 1.00

                
	 
      	 
      
	
                  (f)  Thereafter

                	
                  1.20
      to 1.00

                

        

      

    

     

    Each of
the covenants in this Section 10
shall be based upon the trailing twelve (12) month results, and shall be
tested on a quarterly basis, as of the last day of each fiscal quarter of
Borrowers, commencing with the fiscal quarter ending December 31,
2010.

    
      
         

      

      
        70

        
          

        

      

      
         

      

    

    Section
11  Default.

     

    The
occurrence and continuation of any one or more of the following events shall
constitute a “Default”
hereunder:

     

    11.1        Payment of
Obligations.  The
failure of any Borrower to pay (a) the Principal Debt on the Maturity Date, (b)
any mandatory payment or prepayment of principal or interest (including but not
limited to any Annual Excess Cash Flow Payment pursuant to Section 2.5(b)
and any mandatory amortization payment pursuant to Section
3.2(b)) on the date such payment is due and payable under any Loan
Document, (c) any scheduled interest payment within three (3) Business Days of
its due date under any Loan Document, or (d) any other portion of the
Obligations, including fees payable to Lenders under Section
4.2, within two (2) Business Days of the date when it becomes due and
payable under any Loan Document.

     

    11.2        Covenants.  The
failure of any Borrower to punctually and properly perform, observe and comply
with:

     

    (a)  Any
covenant, agreement, or condition contained in Sections 2.3(b),
8.13,
8.14, 9.5, 9.6, 9.7, 9.9 or
10;

     

    (b)  A
Control Event shall occur and be continuing; or

     

    (c)  Any
other covenant, agreement, or condition contained in any Loan Document (other than the covenants to
pay the Obligations and the covenants in clause (a) preceding), and
such failure continues for twenty (20) Business Days after the earlier of
(i) delivery by Agent or any Lender to any Borrower of notice of such
non-compliance or (ii) a Responsible Officer of any Borrower becoming aware of
such failure.

     

    11.3        Debtor
Relief.  Any
Borrower (a) voluntarily seeks, consents to, or acquiesces in the benefit of any
Debtor Relief Law, other than a voluntary liquidation or dissolution permitted
by Section
9.6, (b) becomes a party to or is made the subject of any proceeding
provided for by any Debtor Relief Law (other than as a creditor,
claimant, purchaser, or party making a bid to purchase assets), and (i) the
petition is not controverted within ten (10) days and is not dismissed within
sixty (60) days, or (ii) an order for relief is entered under Title 11 of the
United States Code, (c) makes an assignment for the benefit of creditors,
(d) fails (or admits in writing its inability) to pay its debts generally
as they become due, or (e) is not Solvent.

     

    11.4        Judgments and
Attachments.  Any
Borrower fails, within twenty (20) days after entry, to pay, bond or otherwise
discharge any judgment or order for the payment of money in excess of $250,000
(individually or in the aggregate and net of applicable insurance if the insurer
has accepted coverage) or any warrant of attachment, sequestration or similar
proceeding against any Borrower’s assets that is not (a) stayed on appeal or (b)
diligently contested in good faith by appropriate proceedings with adequate
reserves being set aside on its books in accordance with GAAP.

     

    11.5        Misrepresentation.  Any
representation or warranty made to any Lender (or its Representatives) by any
Borrower or contained in any Loan Document at any time proves to have been
incorrect in any material respect when made (excluding clerical, typographical
or other similar scrivener errors); provided, that, with respect
to the representations in Sections
7.6 and 7.8, the
Borrowers shall have twenty (20) days to cure any such misrepresentation after
the first to occur of (a) written notice of such misrepresentation has been
given to any Borrower by Agent or any Lender, and (b) any Borrower knows of
such misrepresentation.

    
      
         

      

      
        71

        
          

        

      

      
         

      

    

    11.6        Default Under Other
Agreements.

     

    (a)  Except
for trade accounts payable in the ordinary course of business, any Borrower
fails to pay when due (after lapse of any applicable grace period) any amount
(individually or in the aggregate) of Debt in an amount equal to $250,000 or
more, or any default exists under any agreement which permits any Person to
cause an amount (individually or in the aggregate) of Debt in an amount equal to
$250,000 or more to become due and payable by any Borrower before its stated
maturity.

     

    (b)  Any
Borrower breaches or defaults under any term, condition, provision,
representation or warranty contained in any agreement and the effect of such
breach or default could reasonably be expected to result in a Material Adverse
Event.

     

    (c)  A
default occurs under the Valley Note or any other Subordinated
Debt.

     

    11.7        Validity and Enforceability
of Loan Documents.  Except
in accordance with its terms or as otherwise expressly permitted by this
Agreement, any Loan Document at any time after its execution and delivery ceases
to be in full force and effect in any material respect or is declared by a
Governmental Authority to be null and void or its validity or enforceability is
contested by any Borrower or any Borrower denies that it has any further
liability or Obligations under any Loan Document, unless such Borrower does not
have any further liability or Obligations under such Loan Document as a result
of a transaction permitted by this Agreement.

     

    11.8        Change of Control, Change of
Management or Control Event.  A
Change of Control, a Change of Management or a Control Event
occurs.

     

    11.9        Ownership of Other
Borrowers.  Any
Borrower (other than the Company) ceases to be owned, beneficially and of
record, with power to vote at least fifty-one percent (51%) of its issued and
outstanding shares of capital stock, partnership or membership interests or
other equity interests, by the Company or any other Borrower (except as a result of a
transaction permitted by this Agreement or otherwise consented to in advance by
Agent).

     

    11.10      Subordination
Agreements.  There
shall occur and be continuing any material breach under the Valley Note
Subordination Agreement or any other Subordination Agreement by any party
thereto other than Agent or any Lender, or the Valley Note Subordination
Agreement or any other Subordination Agreement shall terminate, cease to be
effective or cease to be legally valid, binding and enforceable against any
holder of the applicable Subordinated Debt.

     

    11.11      Material Adverse
Event.  A
Material Adverse Event occurs and shall be continuing.

     

    Section
12  Rights
And Remedies.

     

    12.1        Remedies Upon
Default.

    
      
         

      

      
        72

        
          

        

      

      
         

      

    

    (a)  If
a Default exists under Section 11.3,
the entire unpaid balance of the Obligations automatically becomes due and
payable without any action of any kind.

     

    (b)  If
a Default exists, Agent and Lenders may do any one or more of the
following:  (i) if the maturity of the Obligations has not
already been accelerated under Section 12.1(a),
declare the entire unpaid balance of all or any part of the Obligations
immediately due and payable; (ii) reduce any claim to judgment; and
(iii) exercise any and all other legal or equitable rights afforded by the
Loan Documents, the Laws of the State of New York or the Laws of any other
applicable jurisdiction.

     

    12.2        Borrower
Waivers.  To
the fullest extent permitted by applicable Law, each Borrower waives diligence,
presentment and demand for payment, protest, notice of intent to accelerate,
notice of acceleration and notice of protest, demand, dishonor and nonpayment,
and agrees that its liability with respect to all or any part of the Obligations
is not affected by any renewal or extension in the time of payment of all or any
part of the Obligations, by any indulgence, or by any release or change in any
security for the payment of all or any part of the Obligations.

     

    12.3        Performance by Agent.  If
any covenant, duty or agreement of any Borrower is not performed in accordance
with the terms of the Loan Documents, Agent may, while a Default or Potential
Default exists, at its option, perform or attempt to perform that covenant, duty
or agreement on behalf of that Borrower (and any amount reasonably expended by
Agent in its performance or attempted performance is payable by the Borrowers,
jointly and severally, to Agent on demand, becomes part of the Obligations, and
bears interest at the Default Rate from the date of Agent’s expenditure until
paid).  However, Agent does not assume, except by its express written
consent, any liability or responsibility for the performance of any covenant,
duty or agreement of any Borrower.

     

    12.4        Not in
Control.  None
of the covenants or other provisions contained in any Loan Document shall, or
shall be deemed to, give Agent or any Lender the right to exercise control over
the assets (including, without limitation, real property), affairs, or
management of any Borrower (other than control for Lien perfection purposes);
the power of Agent and Lenders is limited to the right to exercise the remedies
provided in this Section
12.

     

    12.5        Course of
Dealing.  The
acceptance by Agent or any Lender of any partial payment on the Obligations
shall not be deemed to be a waiver of any Default then existing.  No
waiver by Agent or any Lender of any Default shall be deemed to be a waiver of
any other then-existing or subsequent Default or Potential
Default.  No delay or omission by Agent or any Lender in exercising
any right under the Loan Documents will impair that right or be construed as a
waiver thereof or any acquiescence therein, nor will any single or partial
exercise of any right preclude other or further exercise thereof or the exercise
of any other right.

     

    12.6        Cumulative
Rights.  All
rights available to Agent and Lenders under the Loan Documents are cumulative of
and in addition to all other rights granted to Agent and Lenders at law or in
equity, whether or not the Obligations is due and payable and whether or not
Agent or any Lender has instituted any suit for collection, foreclosure, or
other action in connection with the Loan Documents.

    
      
         

      

      
        73

        
          

        

      

      
         

      

    

    12.7        Application of
Proceeds.  Any
and all proceeds received by Agent or Lenders from the exercise of any rights
and remedies pertaining to the Obligations shall be applied to the Obligations
in accordance with Section 3.3.

     

    12.8        Diminution in Value of
Collateral.  Neither
Agent nor any Lender has any liability or responsibility for any diminution in
or loss of value of any Collateral now or hereafter securing payment or
performance of all or any part of the Obligations.

     

    Section
13  Agent.

     

    13.1        Appointment and
Authorization of Agent.

     

    (a)  Each
of the Lenders hereby appoints Deerpath to act on its behalf as 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 and any Lender, and no Borrower shall have rights as a third
party beneficiary of any of such provisions.

     

    (b)  Except
as set forth in Section 14.8(a)
or otherwise specified in this Agreement:

     

    (i)           subject
to subsection (ii) below, the exercise of any right or remedy; the grant of any
waiver, consent, agreement, approval, authorization or acceptance; the execution
and delivery of any document, agreement or instrument; the making of any
request, election, designation or requirement; the receipt of notice of any
event or of delivery of any document; and the taking of any other action by or
on behalf of “Lender” or “Lenders” under this Agreement or any other Loan
Document shall require only the action or approval of the Agent, and Borrowers
shall be entitled to rely on any of the foregoing actions and approvals by Agent
as being the valid action or approval of Agent on behalf of Lenders;
and

     

    (ii)          except
as set forth in Section 13.10
(with respect to certain Collateral matters), Agent shall not take any
discretionary action or exercise any discretionary powers without the consent or
approval of Lenders holding at least a majority of the Percentage
Interests.

     

    13.2        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 the 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.

    
      
         

      

      
        74

        
          

        

      

      
         

      

    

    13.3        Exculpatory
Provisions.  Agent
shall not have any duties or obligations except those expressly set out 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 or Potential Default has occurred and is continuing;

     

    (b)  shall
not have any duty to take any discretionary action or exercise any discretionary
powers; 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;

     

    (c)  shall
not, except as expressly set out herein and in the other Loan Documents, be
liable for the failure to disclose, any information relating to any Borrower 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; and

     

    (d)  shall
not be liable for any action taken or not taken by it (i) with the consent or at
the request of the Lenders or (ii) in the absence of its own gross negligence or
willful misconduct.  Agent shall be deemed not to have knowledge of
any Default or Potential Default unless and until written notice describing such
Default or Potential Default is given to Agent by Borrowers or a
Lender.  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
out herein or therein or the occurrence of any Default or Potential 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 out in Section 5
or elsewhere herein, other than to confirm receipt of items expressly required
to be delivered to Agent.

     

    13.4        Reliance by
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 that by its terms must be fulfilled to the
satisfaction of a Lender, Agent may presume that such condition is satisfactory
to such Lender unless Agent shall have received notice to the contrary from such
Lender prior to the making of such Loan.  Agent may consult with legal
counsel (who may be counsel for one or more 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.

    
      
         

      

      
        75

        
          

        

      

      
         

      

    

    13.5        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 Affiliates.  The exculpatory provisions of
this Section shall apply to any such sub-agent and to the Affiliates 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.

     

    13.6        Resignation; Removal of
Agent.

     

    (a)  Agent
may at any time give written notice of its resignation to
Lenders.  Agent may also be removed at any time, with or without
cause, by the affirmative vote of Lenders holding a majority of the Percentage
Interests.

     

    (b)  Upon
the resignation or removal of Agent pursuant to this Section
13.6, Lenders shall have the right, in consultation with Borrower, to
appoint, by vote of a majority of the Percentage Interests, a successor, which
may be any other Lender or any other Person selected by vote of Lenders holding
majority of the Percentage Interests.  If no such successor shall have
been so appointed by the Lenders and shall have accepted such appointment within
30 days after the resignation or removal of the Agent, then the resigning or
removed Agent (the “Retiring
Agent”) may, on behalf of Lenders, appoint a successor Agent meeting the
qualifications set out above; provided that if Agent shall
notify a Borrower and the Lenders that no qualifying Person has accepted such
appointment, then such resignation or removal shall nonetheless become effective
in accordance with such notice and (i) 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 the Retiring Agent
on behalf of the Lenders 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 (ii) all payments, communications and determinations
provided to be made by, to or through Agent shall instead be made by or to each
Lender directly, until such time as the Lenders appoint a successor Agent as
provided for above in this Section.

     

    (c)  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 “Agent”, under this Agreement and the other Loan Documents,
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).  After the
Retiring Agent’s resignation or removal hereunder and under the other Loan
Documents, the provisions of this Section and Section 8.6
shall continue in effect for the benefit of such Retiring Agent, its
sub-agents and their respective Affiliates in respect of any actions taken or
omitted to be taken by any of them while the Retiring Agent was acting as
Agent.

    
      
         

      

      
        76

        
          

        

      

      
         

      

    

    13.7        Non-Reliance on Agent and
Other Lenders.  Each
Lender acknowledges that it has, independently and without reliance upon Agent
or any other Lender or any of their respective Affiliates 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 also
acknowledges that it will, independently and without reliance upon Agent or any
other Lender or any of their respective Affiliates 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.

     

    13.8        No Other Duties,
Etc.  Anything
herein to the contrary notwithstanding, no Lender shall have any duties or
responsibilities under this Agreement or any of the other Loan Documents, except
in its capacity, as applicable, as Agent, Lender or both.

     

    13.9        Agent May File Proofs of
Claim.  In
case of the pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to any Borrower, Agent (irrespective of whether the
principal of any Loan 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 any Borrower) 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, 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 and Agent (including any claim for the
reasonable compensation, expenses, disbursements and advances of Lenders and
Agent and their respective agents and counsel and all other amounts due Lenders
and Agent under Sections 8.6
and 8.11)
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 to make such payments to Agent and 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 8.6
and 8.11.  Nothing
contained herein shall be deemed to authorize Agent to authorize or consent to
or accept or adopt on behalf of any Lender any plan of reorganization,
arrangement, adjustment or composition affecting the Obligations or the rights
of any Lender or to authorize Agent to vote in respect of the claim of any
Lender in any such proceeding.

     

    13.10      Collateral
Matters.

     

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

    
      
         

      

      
        77

        
          

        

      

      
         

      

    

    (b)  Each
Lender hereby authorizes Agent, at its option and in its discretion, to release
any Lien on any property granted to or held by Agent under any Loan Document (i)
upon payment in full of the Loans and all other Obligations (other than
contingent indemnification Obligations) and termination of the Term Loan
Commitment and any other commitment by Lenders hereunder, (ii) that is sold or
to be sold as part of or in connection with any sale permitted hereunder or
under any other Loan Document, (iii) subject to Section 14.8(a),
if approved, authorized or ratified in writing by the Lenders, or (iv) in
connection with any foreclosure sale or other disposition of Collateral after
the occurrence of a Default.  Upon request by Agent at any time, each
Lender will confirm in writing Agent’s authority to release its interest in
particular types or items of Collateral pursuant to this Section
13.10.

     

    (c)  Subject
to subsection (b) above, Agent shall (and
is hereby authorized by each Lender to) execute such documents as may be
necessary to evidence the release of the Liens granted to Agent for the benefit
of Agent and Lenders herein or pursuant to this Agreement upon the applicable
Collateral; provided
that (i) Agent shall not be required 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 shall not in any manner
discharge, affect or impair the Obligations or any Liens upon any interests
retained by Borrowers or any other Person, 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 or any other Person to ensure
that the Collateral exists or is owned by a Borrower or any other Person or is
cared for, protected or insured or that the Liens granted to Agent herein or in
any of the Security Documents or pursuant to this Agreement 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
13.10 or in any of the Security 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 the Lenders
and that Agent shall have no duty or liability whatsoever to the
Lenders.

    
      
         

      

      
        78

        
          

        

      

      
         

      

    

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

     

    Section
14  Miscellaneous.

     

    14.1        Headings.  The
headings and captions used in the Loan Documents are for convenience only and
will not be deemed to limit, amplify or modify the terms of the Loan
Documents.

     

    14.2        Non-Business
Days.  Any
payment or action that is due under any Loan Document on a non-Business Day may
be delayed until the next-succeeding Business Day, but interest shall continue
to accrue on any applicable payment until payment is made.

     

    14.3        Communications.  Unless
otherwise provided, any consent, notice, or other communication under or in
connection with any Loan Document must be in writing to be effective and shall
be deemed to have been given (a) if by telecopy, when transmitted to the
appropriate telecopy number, (b) if by mail, on the third Business Day
after it is enclosed in an envelope and properly addressed, stamped, sealed,
certified return receipt requested, and deposited in the appropriate official
postal service, or (c) if by electronic mail or any other means, when
actually received or delivered (with respect to electronic mail, each party
giving such notice shall be responsible for keeping records acceptable to
Lenders regarding all such notices).  Until changed by notice pursuant
to this Agreement, the address (and telecopy number) for each party is as
follows:

     

    If to
Borrowers:

     

    Oak Tree
Educational Partners, Inc.

    845 Third
Avenue, 6th
Floor

    New York,
New York 10022

    Attention:  Anil
Narang

    Fax
No.:  (646) 290-5001

    Tel.
No.:  (646) 290-5290

     

    with a
copy to (which shall not constitute notice):

     

    Hodgson
Russ LLP

    1540
Broadway

    24th
floor

    New York,
New York 10036

    Attention:  Stephen
A. Weiss, Esq.

    Email:
sweiss@hodgsonruss.com

    Fax
No.:  (212) 751-0928

    Tel.
No.:  (212) 751-4300

    
      
         

      

      
        79

        
          

        

      

      
         

      

    

    If to
Agent or Lenders:

    

    Deerpath
Funding, LP

    405
Lexington Avenue, 71st
Floor

    New York,
NY 10174

    Attention:  James
H. Kirby

    Fax
No.:  (646) 417-7095

    Tel.
No.:  (646) 786-1022

    

    with a
copy to (which shall not constitute notice):

     

    Porter
& Hedges, LLP

    1000 Main
Street, 36th
Floor

    Houston,
Texas 77002

    Attention:
Andrew C. Fertitta

    Email:  afertitta@porterhedges.com

    Tel:  (713) 226-6640

    Fax No:
(713) 226-6240

     

    14.4        Survival.  Unless
otherwise provided, all covenants, agreements, representations and warranties
made in this Agreement and any of the other Loan Documents shall survive and
continue in effect as long as any Loan or other Obligations is outstanding or
any commitment by Lenders hereunder is in effect; provided, that the
indemnities set out in Section 8.6
and their terms and provisions shall survive the satisfaction and payment
of the Obligations and the termination of this Agreement and Lenders’
commitments hereunder.

     

    14.5        Governing
Law.  This
Agreement and each Loan Document shall be a contract made under and governed by
the internal laws of the State of New York applicable to contracts made and to
be performed entirely within such state, without regard to conflict of law
principles.

     

    14.6        Invalid
Provisions.  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 and legal effect of which comes as
close as possible to the intent 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.

     

    14.7        Multiple
Counterparts.

     

    (a)  Each
Loan Document may be executed in several counterparts, each of which shall be
deemed an original and all of which shall constitute one and the same
instrument, and shall become effective when counterparts have been signed by
each of the parties and delivered to the other parties; it being understood that
all parties need not sign the same counterpart.

    
      
         

      

      
        80

        
          

        

      

      
         

      

    

    (b)  The
exchange of copies of any Loan Document and of signature pages to any Loan
Document by facsimile transmission (whether directly from one facsimile device
to another by means of a dial-up connection or whether mediated by the worldwide
web), by electronic mail in “portable document format” (“pdf”)
form, or by any other electronic means intended to preserve the original graphic
and pictorial appearance of a document, or by combination of such means, shall
constitute effective execution and delivery of such Loan Document as to the
parties thereto and may be used in lieu of the original Loan Document for all
purposes.  Signatures of the parties transmitted by facsimile shall be
deemed to be their original signatures for all purposes.

     

    14.8        Amendments; Assignments and
Participations.

     

    (a)  The
Loan Documents may be amended, modified, supplemented or be the subject of a
waiver only by a writing executed by Agent, Lenders and
Borrowers.  Any conflict or ambiguity between this Agreement and any
other Loan Document is controlled by the terms and provisions of this
Agreement.  This Agreement is binding upon, and inures to the benefit
of, the parties hereto and their respective successors and permitted
assigns.

     

    (b)  Upon
prior written notice to the Borrowers, from time to time any Lender may assign,
or sell one or more participations in, all or any portion of its Notes and its
other rights and obligations under the Loans, this Agreement and the other Loan
Documents, to one or more Persons.

     

    (c)  Any
Lender may furnish any information concerning the Borrowers in its possession
from time to time to assignees and participants (including prospective assignees
and participants).

     

    (d)  To
facilitate any assignment or participation pursuant to this Section
14.8, Borrowers shall, from time to time promptly upon the request of any
Lender, execute and deliver to such Lender or to such party or parties as such
Lender may designate, any and all replacement Notes and Warrants, consents,
acknowledgements and other instruments and agreements as may in the reasonable
opinion of such Lender be necessary or advisable to give full force and effect
to such assignment or participation.

     

    (e)  No
Borrower may assign or transfer its rights or Obligations hereunder or any
interest herein or delegate its duties or Obligations hereunder without the
prior written consent of Agent and each of the Lenders.

     

    14.9        Term.  This
Agreement will stay in effect until, and all obligations under this Agreement
shall terminate (except for any provisions thereof, such as indemnification
provisions, which by their terms survive termination), upon the later to occur
of (a) all Principal Debt and accrued interest under the Loans and all other
Obligations have been repaid in full and no Loan or other Obligations remain
outstanding, and (b) all commitments of Lenders hereunder have been terminated
or expired.

    
      
         

      

      
        81

        
          

        

      

      
         

      

    

    14.10      Marshaling; Discharge Only
Upon Payment in Full; Reinstatement in Certain Circumstances.  Neither
Agent nor any Lender shall be under any obligation to marshal any assets in
favor of any Borrower or any other Person or against or in payment of any or all
of the Obligations hereunder.  Except as otherwise provided herein,
each Borrower’s Obligations under the Loan Documents remain in full force and
effect until the Obligations are paid in full (except for provisions under
the Loan Documents which by their terms expressly survive payment of the
Obligations and termination of the Loan Documents).  If at any time
any payment of the principal of or interest on any Loan or any other amount
payable by any Borrower or any other obligor on the Obligations under any Loan
Document is rescinded or must be restored or returned upon the insolvency,
bankruptcy or reorganization of any Borrower or otherwise, the Obligations of
each Borrower under the Loan Documents with respect to that payment shall be
reinstated as though the payment had been due but not made at that
time.

     

    14.11      Arbitration.  Agent,
each Lender, and each Borrower agree that upon the written demand of either
party, whether made before or after the institution of any legal proceedings,
but prior to the rendering of any judgment in that proceeding, all disputes,
claims, and controversies between them, whether individual, joint, or class in
nature, arising from this Agreement, the Loan Documents, or otherwise, including
without limitation contract disputes and tort claims, shall be resolved by
binding arbitration pursuant to the Commercial Rules of the American Arbitration
Association (“AAA”).  Any
arbitration proceeding held pursuant to this arbitration provision shall be
conducted in New York, New York, or at any other place selected by mutual
agreement of the parties.  No act to take or dispose of any Collateral
shall constitute a waiver of this Section 14.11
agreement or be prohibited by this Section 14.11.  This
arbitration provision shall not limit the right of either party during any
dispute, claim or controversy to seek, use, and employ ancillary, or preliminary
rights and/or remedies, judicial or otherwise, for the purposes of realizing
upon, preserving, protecting, foreclosing upon or proceeding under forcible
entry and detainer for possession of, any real or personal property, and any
such action shall not be deemed an election of remedies. Such remedies include,
without limitation, obtaining injunctive relief or a temporary restraining
order, invoking a power of sale under any deed of trust or mortgage, obtaining a
writ of attachment or imposition of a receivership, or exercising any rights
relating to personal property, including exercising the right of set-off, or
taking or disposing of such property with or without judicial process pursuant
to the UCC.  Any disputes, claims or controversies concerning the
lawfulness or reasonableness of an act, or exercise of any right or remedy
concerning any Collateral, including any claim to rescind, reform, or otherwise
modify any agreement relating to the Collateral, shall also be arbitrated; provided that, no arbitrator
shall have the right or the power to enjoin or restrain any act of either
party.  Judgment upon any award rendered by any arbitrator may be
entered in any court having jurisdiction.  The statute of limitations,
estoppel, waiver, laches and similar doctrines which would otherwise be
applicable in an action brought by a party shall be applicable in any
arbitration proceeding, and the commencement of an arbitration proceeding shall
be deemed the commencement of any action for these purposes. The Federal
Arbitration Act (Title 9 of the United States Code) shall apply to the
construction, interpretation, and enforcement of this arbitration
provision.

     

    14.12      No Implied Waivers;
Cumulative Remedies; Writing Required.  No
delay or failure of Agent or any Lender in exercising any right, power or remedy
hereunder shall affect or operate as a waiver thereof, nor shall any single or
partial exercise thereof or any abandonment or discontinuance of steps to
enforce such a right, power or remedy preclude any further exercise thereof or
any other right, power or remedy.  The rights and remedies hereunder
of Agent and the Lenders are cumulative and not exclusive of any rights or
remedies which they would otherwise have.  Any waiver, permit, consent
or approval of any kind or character on the part of Agent or any Lender of any
breach or default under this Agreement or any such waiver of any provision or
condition of this Agreement must be in writing and shall be effective only to
the extent specifically set forth in such writing.

    
      
         

      

      
        82

        
          

        

      

      
         

      

    

    14.13      Electronic
Submissions.  Upon
not less than thirty (30) days’ prior written notice (the “Approved
Electronic Form Notice”), Agent or Lenders may permit or require that any
of the documents, certificates, forms, deliveries or other communications,
authorized, required or contemplated by this Agreement or the other Loan
Documents be submitted to Lenders in Approved Electronic Form (as hereafter
defined), subject to any reasonable terms, conditions and requirements in the
applicable Approved Electronic Forms Notice.  For purposes hereof
“Electronic
Form” means e-mail, e-mail attachments, data submitted on web-based forms
or any other communication method that delivers machine readable data or
information to Lenders, and “Approved
Electronic Form” means an Electronic Form that has been approved in
writing by Lenders (which approval has not been revoked or modified by Lenders)
and sent to Borrowers in an Approved Electronic Form Notice.  Except
as otherwise specifically provided in the applicable Approved Electronic Form
Notice, any submissions made in an applicable Approved Electronic Form shall
have the same force and effect that the same submissions would have had if they
had been submitted in any other applicable form authorized, required or
contemplated by this Agreement or the other Loan Documents.

     

    14.14      Jury
Waiver.  Agent,
Lenders and Borrowers hereby voluntarily, knowingly, irrevocably and
unconditionally waive any right to have a jury participate in resolving any
dispute (whether based upon contract, tort or otherwise) between Agent, Lenders
(or any Lender) and Borrowers (or any Borrower) arising out of or in any way
related to this Agreement or any Loan Document, or any relationship between
Agent, any Lender and any Borrower.  This provision is a material
inducement to Agent and Lenders to provide the financing described in this
Agreement.

     

    14.15      Venue and Service of
Process.  Each party
to any Loan Document, in each case for itself, its successors and assigns, (a)
irrevocably submits and consents to the exclusive jurisdiction of the state and
federal courts of the state of New York (and of the appropriate appellate courts
therefrom), (b) irrevocably waives, to the fullest extent permitted by law,
any objection that it may now or hereafter have to the laying of venue of any
Litigation arising out of or in connection with the Loan Documents and the
Obligations brought in the district court of New York county, New York, or in
the United States District Court for the Southern District of New York,
(c) irrevocably waives any claims that any litigation brought in any of the
aforementioned courts has been brought in an inconvenient forum,
(d) irrevocably consents to the service of process out of any of those
courts in any Litigation by the mailing of copies thereof by certified mail,
return receipt requested, postage prepaid, by hand-delivery, or by delivery by a
nationally recognized courier service, and service shall be deemed complete upon
delivery of the legal process at its address set out in this Agreement, and
(e) irrevocably agrees that any legal proceeding against any party to any
Loan Document arising out of or in connection with the Loan Documents or the
Obligations may be brought in one of the aforementioned courts.  The
scope of each of the foregoing consents and waivers is intended to be
all-encompassing of any and all disputes that may be filed in any court and that
relate to the subject matter of this transaction, including, without limitation,
contract claims, tort claims, breach of duty claims, and all other common law
and statutory claims.  Each Borrower acknowledges that these consents
and waivers are a material inducement to Lenders’ agreement to enter into a
business relationship, that Agent and Lenders have already relied on these
consents and waivers in entering into this Agreement, and that Agent and Lenders
will continue to rely on each of these consents and waivers in related future
dealings.  Each Borrower further warrants and represents that it has
reviewed these consents and waivers with its legal counsel, and that it
knowingly and voluntarily agrees to each consent and waiver following
consultation with legal counsel.

    
      
         

      

      
        83

        
          

        

      

      
         

      

    

    The
consents and waivers in this Section 14.15 are
irrevocable, meaning that they may not be modified either orally or in writing,
and these consents and waivers shall apply to any subsequent amendments,
supplements, or replacements to or of this or any other Loan
Document.  In the event of Litigation, this Agreement may be filed as
a written consent to a trial by the court.

     

    14.16      Marketing and Disclosure
Rights of Lenders.  Each
Borrower hereby grants Agent and each Lender the right to divulge such
Borrower’s name and a brief description of the transactions contemplated by this
Agreement and the other Loan Documents, including such information as is
normally and customarily provided in tombstone advertisements, on Agent’s or any
Lender’s internet website, in Agent’s or any Lender’s newsletter or in any of
Agent’s or any Lender’s other marketing materials; provided, that neither Agent
nor any Lender shall divulge any non-public information about the financial
condition of the Borrowers in any such advertisements.  Each Borrower
also grants Agent and each Lender the right to divulge information about the
Borrowers and all material aspects of the transactions contemplated by this
Agreement and the other Loan Documents to the SBA and to Agent’s and each
Lender’s current and prospective lenders, partners, affiliates, investors,
co-investors and co-lenders, subject to Agent’s and Lenders’ obligations to
instruct such Persons to maintain the confidentiality of such
information.  Borrower further understands and acknowledges that Agent
and each Lender and one or more of their respective members and affiliates
(including Deerpath Capital, LP, a Delaware limited partnership,
Deerpath Capital Management, LP a Delaware limited partnership,
Deerpath Capital General Partner, LLC, a Delaware limited liability
company, and Deerpath Funding General Partner, Inc. a Delaware corporation) may have
certain regulatory requirements in order to maintain compliance with the rules
and regulations of the Securities and Exchange Commission (the “SEC”) and
as such Borrower approves and consents to the disclosure of the transactions
contemplated by this Agreement for such purposes.

     

    14.17      Managerial Assistance by
Lenders.  Each
Borrower acknowledges that Lenders have offered and continue to offer to make
available managerial, consulting or other assistance upon such Borrower’s
request.

    
      
         

      

      
        84

        
          

        

      

      
         

      

    

    14.18      Entirety.  This
Agreement and the other Loan Documents represent the final agreement between the
Agent, Lenders and Borrowers and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof,
including without limitation the Commitment Letter and any term sheet entered
into by any Lender and any Borrower.  This Agreement and the other
Loan Documents may not be contradicted by evidence of prior, contemporaneous, or
subsequent oral agreements by the parties.  There are no unwritten
oral agreements among the parties.

     

    [The
remainder of this page has been intentionally left blank.

    Signatures are on the following
page.]

    
      
         

      

      
        85

        
          

        

      

      
         

      

    

     

    IN
WITNESS WHEREOF, the parties have executed and delivered this Loan Agreement as
of the date first written above.

     

    
      
        
          	 
      	
                  AGENT:

                
	 
      	 
      
	 
      	
                  Deerpath
      Funding, LP

                
	 
      	
                  a
      Delaware limited partnership,

                
	 
      	
                  as
      Agent

                
	 
      	 
      
	 
      	
                  By:        Deerpath
      Funding General Partner, Inc.

                
	 
      	
                     its
      general partner

                
	 
      	 
      
	 
      	
                  By: 

                	
                  /s/ James H. Kirby

                
	 
      	
                  Name:         James
      H. Kirby

                
	 
      	
                  Title:           President

                
	 
      	 
      
	 
      	
                  LENDER:

                
	 	 
	 
      	
                  Deerpath
      Funding, LP

                
	 
      	
                  a
      Delaware limited partnership,

                
	 
      	
                  as
      Lender

                
	 
      	 
      
	 
      	
                  By:        Deerpath
      Funding General Partner, Inc.

                
	 
      	
                     its
      general partner

                
	 
      	 
      
	 
      	
                  By:

                	
                  /s/ James H. Kirby

                
	 
      	
                  Name:         James
      H. Kirby

                
	 
      	
                  Title:           President

                

        

      

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    BORROWERS:

    

    
      
        	
                Oak
      Tree Educational Partners, Inc.

              	 
      	
                Educational
      Investors, Inc.

              
	
                (formerly
      known as Florham Consulting Corp.)

              	 
      	
                a
      Delaware corporation

              
	
                a
      Delaware corporation

              	 
      	 
      
	 
      	 
      	 
      
	
                By: 

              	
                /s/ Joseph J. Bianco

              	 
      	
                By: 

              	
                /s/ Joseph J. Bianco

              
	
                Name:       Joseph
      J. Bianco

              	 
      	
                Name:       Joseph
      J. Bianco

              
	
                Title:         Chief
      Executive Officer

              	 
      	
                Title:         Chief
      Executive Officer

              
	 
      	 
      	 
      
	
                Training
      Direct, LLC

              	 
      	
                Valley
      Anesthesia, Inc.

              
	
                a
      Connecticut limited liability company

              	 
      	
                a
      Delaware corporation

              
	 
      	 
      	 
      
	
                By:

              	
                /s/ Joseph Monaco

              	 
      	
                By:

              	
                /s/ Joseph J. Bianco

              
	
                Name:       Joseph
      Monaco, Jr.

              	 
      	
                Name:       Joseph
      J. Bianco

              
	
                Title:         Manager

              	 
      	
                Title:         Chief
      Executive Officer

              
	 
      	 
      	 
      
	
                Educational
      Training Institute, Inc.

              	 
      	
                Professional
      Culinary Institute, LLC

              
	
                a
      New York corporation

              	 
      	
                a
      New York limited liability company

              
	 
      	 
      	 
      
	
                By:

              	
                /s/ Joseph Monaco

              	 
      	
                By:

              	
                /s/ Joseph Monaco

              
	
                Name:       Joseph
      Monaco, Jr.

              	 
      	
                Name:       Joseph
      Monaco, Jr.

              
	
                Title:         President

              	 
      	
                Title:         Manager

              
	 
      	 
      	 
      
	
                Culinary
      Tech Center, LLC

              	 
      	 
      
	
                a
      New York limited liability company

              	 
      	 
      
	 
      	 
      	 
      
	
                By:

              	
                /s/ Joseph Monaco

              	 
      	 
      
	
                Name:       Joseph
      Monaco, Jr.

              	 
      	 
      
	
                Title:         Manager

              	 
      	 
      

      

    

     

    
      [Signature
Page 2 of 2 to Loan Agreement]PROMISSORY
NOTE

    (Deerpath Initial
Term Note)

     

    
      	
              $3,000,000.00

            	
              New
      York, New York

            	
              November
      30, 2010

            

    

    

    FOR VALUE
RECEIVED, Oak
Tree Educational Partners, Inc., a Delaware corporation formerly known as
Florham Consulting Corp. (the “Company”),
Educational
Investors, Inc., a Delaware corporation (“EII”),
Valley
Anesthesia, Inc., a Delaware corporation (“Valley
Anesthesia”), Training
Direct, LLC, a Connecticut limited liability company (“Training
Direct”), Educational
Training Institute, Inc., a New York corporation (“ETI”),
Professional
Culinary Institute LLC, a New York limited liability company (“PCI”),
Culinary
Tech Center LLC, a New York limited liability company (“CTC”), and
each of the Company’s other Subsidiaries, current and future (such Subsidiaries
together with the Company, EII, Valley Anesthesia, Training Direct, ETI, PCI and
CTC, collectively, “Maker”),
hereby promise, jointly and severally, to pay to the order of Deerpath
Funding, LP, a Delaware limited partnership (“Payee”),
the principal amount of Three Million Dollars ($3,000,000.00), or so much
thereof as may be disbursed and outstanding under this note (this “Note”),
together with interest on the outstanding principal balance, as described in
this Note.

     

    This Note
is executed and delivered under, and is subject to the terms of, the Loan
Agreement dated as of the same date as this Note (as amended, supplemented, or
restated, from time to time, the “Loan
Agreement”) by and among Maker, Payee and the other Lenders named
therein, and Payee, as administrative agent and collateral agent for itself and
the other Lenders, and is the “Deerpath Initial Term Note” referred to in the
Loan Agreement.  Capitalized terms used, but not defined, in this Note
have the meanings given them in the Loan Agreement.

     

    Reference
is made to the Loan Agreement for provisions affecting this Note regarding
applicable interest rates, principal and interest payment dates, prepayments,
final maturity, default, acceleration of maturity, exercise of rights, payment
of attorneys’ fees, court costs and other costs of collection, arbitration and
certain waivers by Maker and others now or hereafter obligated for payment of
the amounts due under this Note.  This Note is a Loan Document and,
therefore, is subject to the provisions of the Loan Agreement.

     

    Specific
reference is made to Section
3.7 of the Loan Agreement for usury savings provisions.

     

    To the
extent permitted by applicable Laws, Maker waives presentment and demand for
payment, protest, notice of intent to accelerate, notice of acceleration and
notice of protest and nonpayment, and agrees that its liability with respect to
all or any part of the Term Loan is not affected by any renewal or extension in
the time of payment of all or any part of the Term Loan, by any indulgence, or
by any release or change in any security for the payment of all or any part of
the Term Loan.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    THIS
NOTE, THE LOAN AGREEMENT, AND THE OTHER WRITTEN LOAN DOCUMENTS EXECUTED BY MAKER
AND PAYEE (OR BY MAKER FOR THE BENEFIT OF PAYEE) REPRESENT THE FINAL AGREEMENT
BETWEEN MAKER AND PAYEE AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS BY THE PARTIES.  THERE
ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

     

    This Note
must be construed3⁄4and
its performance enforced3⁄4under New York
law.

     

    [Signatures
appear on the following page]

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    IN
WITNESS WHEREOF, this Promissory Note has been executed as of the date first set
forth above.

     

    MAKER:

    

    
      
        
          	
                  Oak
      Tree Educational Partners, Inc.

                	 
      	
                  Educational
      Investors, Inc.

                
	
                  a
      Delaware corporation

                	 
      	
                  a
      Delaware corporation

                
	 
      	 
      	 
      	 
      	 
      
	
                  By:

                	
                  /s/ Joseph J. Bianco

                	 
      	
                  By:

                	
                  /s/ Joseph J. Bianco

                
	
                  Name: 

                	
                  Joseph
      J. Bianco

                	 
      	
                  Name: 

                	
                  Joseph
      J. Bianco

                
	
                  Title:

                	
                  Chief
      Executive Officer

                	 
      	
                  Title:

                	
                  Chief
      Executive Officer

                
	 
      	 
      	 
      	 
      	 
      
	
                  Valley
      Anesthesia, Inc.

                	 
      	
                  Training
      Direct, LLC

                
	
                  a
      Delaware corporation

                	 
      	
                  a
      Connecticut limited liability company

                
	 
      	 
      	 
      	 
      	 
      
	
                  By:

                	
                  /s/ Joseph J. Bianco

                	 
      	
                  By:

                	
                  /s/ Joseph Monaco

                
	
                  Name:

                	
                  Joseph
      J. Bianco

                	 
      	
                  Name:

                	
                  Joseph
      Monaco

                
	
                  Title:

                	
                  Chief
      Executive Officer

                	 
      	
                  Title:

                	
                  Manager

                
	 
      	 
      	 
      	 
      	 
      
	
                  Educational
      Training Institute, Inc.

                	 
      	
                  Professional
      Culinary Institute LLC

                
	
                  a
      New York corporation

                	 
      	
                  a
      New York limited liability company

                
	 
      	 
      	 
      	 
      	 
      
	
                  By:

                	
                  /s/ Joseph Monaco

                	 
      	
                  By:

                	
                  /s/ Joseph Monaco

                
	
                  Name:

                	
                  Joseph
      Monaco

                	 
      	
                  Name:

                	
                  Joseph
      Monaco

                
	
                  Title:

                	
                  President

                	 
      	
                  Title:

                	
                  Manager

                
	 
      	 
      	 
      	 
      	 
      
	
                  Culinary
      Tech Center LLC

                	 
      	 
      	 
      
	
                  a
      New York limited liability company

                	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	
                  By:

                	
                  /s/ Joseph Monaco

                	 
      	 
      	 
      
	
                  Name:

                	
                  Joseph
      Monaco

                	 
      	 
      	 
      
	
                  Title:

                	
                  Manager

                	 
      	 
      	 
      

        

      

    

    

    [Signature
Page to Deerpath Initial Term Note]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00182-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00182-of-00352.parquet"}]]