Document:

Exhibit 10.21
-------------
                           SALE AND PURCHASE AGREEMENT
                           ---------------------------

         THIS  SALE  AND  PURCHASE   AGREEMENT   (this   "Agreement")  is  among
Videolocity  International,  Inc., a Nevada corporation  ("Seller"),  and Summit
Media Group LLC, a Delaware limited liability company  ("Purchaser"),  which was
previously  agreed to in principle  during September 2006, and is executed as of
the 11th day of December, 2006 ("Effective Date").

         In consideration of the mutual covenants herein  contained,  Seller and
Purchaser agree as follows:

                                    ARTICLE 1
                                    ---------
                                PURCHASE AND SALE

1.1 Subject to the terms and conditions of this Agreement,  Seller hereby sells,
conveys and assigns to Purchaser,  and Purchaser  hereby  purchases from Seller,
all of Seller's right, title and interest in all of the properties and rights of
the Seller described in Schedule 1 annexed hereto (the "Assets").

                                    ARTICLE 2
                                    ---------
                                 PURCHASE PRICE

         2.1 Purchase  Price.  The  purchase  price  ("Purchase  Price") for the
Assets  of  Seller  as  documented  in  Schedule  1 of this  agreement  shall be
$18,719,000  a price that has been  mutually  agreed upon by both the Seller and
the Purchaser and is further supported by the Preliminary Indication of Value as
prepared by IPA Advisory & Intermediary  Services,  an independent,  third party
company.  The Purchase Price was derived from various factors  including but not
limited to (i) nature of the business;  (ii) outlook of the economy and specific
industry;  (iii) financial condition of the Seller; (iv) nature and value of the
tangible and intangible assets of the business; and (v) market price for similar
corporations,  industry ratios, and other industry  comparisons.  Purchase Price
shall be  payable  to  Seller  based on the  following  schedule  and use of the
assets:  (i)  twenty-five  percent (25%) of the technical  transfer fees and the
first 10% of the net  licensing  fees  derived by  Purchaser in licensing of the
Assets  currently in  development or any subsequent  version  thereof;  (ii) ten
percent 10% of the net  revenues  derived by  Purchasers  deployment  any of the
technologies  beginning one year after effective date of this  agreement;  (iii)
ten percent (10%) of the net revenues  from all other  products or services that
uses a portion or all of the  Intellectual  Property  Technology.  The  Purchase
Price will be paid by  Purchaser  to Seller as provided in Article 4 below.  For
purposes of this agreement Net Revenue shall be defined as "Revenue derived from
use of all or a portion of the  Intellectual  Property  Technology  less  direct
costs customarily used in cost of sales calculations; or as commonly referred to
as gross margin,  these costs shall include the direct incremental cost of sales
including per use cost of content,  costs of T-1 or other delivery method, costs
of interest on equipment deployed to generate revenues with the technology.
<PAGE>

         Until  purchase  price is paid in full the Seller shall hold  preferred
shares of the  Purchaser and will retain the option of the Seller as per section
2.2.  Seller shall be a Non Voting Member of the  Purchaser.  Nonvoting  Members
shall have no voting rights  attached to them and each member holding  Nonvoting
shares shall not be entitled to vote on any Purchaser company matter.

         2.2 Option of the Seller:  In the event that  Purchaser  elects to sell
its Company and or assets prior to payment in full of the Purchase Price for the
Assets of the Seller as outlined in Article 2 Purchase Price, 2.1 Purchase Price
above;  Seller  retains  the  right to either 1)  require  Purchaser  to pay the
remaining balance of the Purchase Price upon its closing of the sale or 2) prior
to sale,  the Seller may convert the remaining  balance of the Purchase Price to
equity in  Purchaser's  company at fair market  value not to exceed five percent
(5%) of purchaser's company.

                                    ARTICLE 3
                                    ---------
                            OBLIGATIONS OF PURCHASER

3.1 Obligations of Purchaser.  Purchaser shall continue developing and licensing
the Assets worldwide,  including the current business  opportunities  within the
Caribbean, the United States, and the European markets.

Purchaser  shall not be  allowed  to sell all or a portion  of the  technologies
until the Purchase Price has been paid in full unless approved in writing by the
Seller.

Purchaser  shall grant Seller a non-exclusive  licensed use of the  technologies
for the pursuit of business  opportunities  by Seller.  In the event that Seller
uses any of the  purchased  technologies  that are  covered  by this  agreement,
Seller  agrees to pay  Purchaser  on a per unit,  lump  sum,  or other  mutually
agreeable  basis at a mutually agreed upon rate not to exceed the then usual and
customary  rate  applicable  to such  products  at  that  time.  However,  in no
circumstance  will the amount be greater than rates that Purchaser would have to
pay Seller under terms of this agreement.

                                    ARTICLE 4
                                    ---------
                          PAYMENT OF PURCHASE AGREEMENT

4.1. Payment of Purchase Agreement. Purchaser has advanced to Seller one hundred
and  fifty  thousand  dollars  ($  150,000)  toward  the  purchase  price of the
purchased  assets  and will  also  make a  monthly  thirty  thousand  dollar  ($
30,000.00)  payment  until  such time that the net  licensing  fees set forth in
Section 2.1 paid by the Purchaser  exceeds  $30,000.00 per month or the revenues
from the  Seller's  licensed  use of the  technology  set fourth in Section  3.1
exceeds monthly  installments of $30,000.00 and shall be remitted to Seller five
days prior to the month when it is due to Seller.  The amounts due to Seller Set
forth in  Section  2.1  shall be paid  monthly  through  December  31,  2007 and
quarterly thereafter. The monthly funding requirement will begin January 1, 2007
which will be due December 26, 2006.  All payments  whether  technical  transfer
fees, net licensing revenues,  or monthly advances will decrease the amount owed
on the  purchase  price.  In the event that  Purchaser is unable or unwilling to

                                      -2-
<PAGE>

make payments and/or advances to Seller in accordance to Section 4.1, Seller may
provide a notice of default and will provide no more than 60 days for  Purchaser
to cure the  default.  If  Purchaser  is unable to cure the  default  within the
allotted  time  following  notification,  Seller  shall  be  granted  a lien  on
available  Summit  Media  Group LLC assets  until the  remaining  balance of the
Purchase Price has been paid in full.

4.1.1  Prepayment Option
       -----------------

The Purchaser  has the right to prepay the Purchase  Price set fourth in Section
2.1 in full at any time with no penalties.

4.2 Right of Audit.  Purchaser  shall  maintain,  in  accordance  with  standard
recognized  accounting  practices (US GAAP),  accurate and complete records that
enable Purchaser to demonstrate  full compliance with this Agreement.  Purchaser
shall make all its books, accounts, memoranda, and other records relative to the
Agreement  available for  inspection  and audit by Seller and/or its  authorized
representatives  at all  reasonable  times  during the term the  Purchase  Price
amount set fourth in Section  2.1 is  outstanding.  If an audit  discloses  that
Purchaser  has been paid by Seller an amount less than any  amounts  owing under
the Purchase Price  Agreement set fourth in Section 2.1,  Purchaser  shall remit
such funds  within 30 days of a formal  claim to Seller.  If an audit  discloses
that  Purchaser  has under  remitted  funds  exceeding  five percent (5%) of the
requirement  under this agreement,  Purchaser will pay all reasonable  costs for
the audit and all related collection efforts.

                                    ARTICLE 5
                                    ---------
                         REPRESENTATIONS AND WARRANTIES

5.1  Seller.  Seller  represents  and  warrants  to  Purchaser  that  it is duly
incorporated in the State of Nevada and validly  operating under the laws of the
State of Nevada and that Seller has the power and authority to complete, and has
properly  authorized,  the sale of the Assets and that it is conveying  good and
marketable  title to Assets being  conveyed  hereunder,  free and clear from all
liens, claims, and encumbrances.

5.2 Purchaser. Purchaser represents and warrants to Seller that it has the power
and  authority to complete,  and has  properly  authorized,  the purchase of the
Assets and the performance of its obligations hereunder.

5.3 All Parties.  Each Party hereto  represents  and warrants to the others that
the execution of this Agreement and any other documents required or necessary to
be executed pursuant to the provisions hereof are valid and binding  obligations
and are enforceable in accordance with their terms.

5.4 Indemnity.  Seller agrees to hold Purchaser and in return,  Purchaser agrees
to hold  Seller  harmless  from and pay for any loss,  damage,  cost or expense,
including but not limited to legal fees and courts costs, which incurs by virtue
of inaccurate representation or warranty made by either party to the other or by
reason of any breach by either party of any covenants or obligations  under this
Agreement.

                                      -3-
<PAGE>

                                    ARTICLE 6
                                    ---------
                                  MISCELLANEOUS

6.1 Notices.  All notices,  demands and requests which may be given or which are
required to be given by any Party to the others under this  Agreement must be in
writing and will be deemed effective either:  (i) at 5:00 pm of the business day
next following the deposit  thereof into the custody of a nationally  recognized
overnight  delivery  service,  addressed to such Party at the address  specified
below; or (ii)  immediately if sent during regular business hours by telegram or
telex,  provided  that  receipt  for such  telegram  or telex is verified by the
sender.  For purposes of this Section 6.1, the  addresses of the Parties for all
notices are as follows (unless changed by similar notice in writing given by the
particular person whose address is to be changed):

IF TO SELLER:
                                    Videolocity International Inc.
                                    PO Box 1929
                                    Sandy, Utah 84091
                                    ATTN:  Robert Holt
                                    Tel:    (435) 615-8338
                                    Fax:    (435) 615-9979

IF TO PURCHASER:
                                    Summit Media Group LLC
                                    5532 Lillehammer Lane
                                    Suite 300
                                    Park City, Utah 84098
                                    Tel: (435) 575-0610

WITH A COPY TO:

                                    Summit Media Group LLC
                                    c/o  Agents and Corporations, Inc.
                                    Suite 600, One Commerce Center
                                    1201 Orange Street
                                    PO Box 511
                                    Wilmington, DE  19899-0511

6.2      Changes. All changes to this agreement will be outlined in an amendment
that is mutually agreeable and will be attached hereto.

6.3      Entire Agreement.  This Agreement embodies the entire agreement between
the parties  relative  to the subject  matter  hereof and  supercedes  all prior
agreements between the parties relative to the subject matter hereof.

6.4      Amendment.  This Agreement may be amended only by a written  instrument
executed by the Party or Parties to be bound hereby.

                                      -4-
<PAGE>

6.5      Headings.  The  captions and headings  used in this  Agreement  are for
convenience  only and do not in any way limit,  amplify or otherwise  modify the
provisions of this Agreement.

6.6      Governing  Law.  This  agreement  shall be governed by and construed in
accordance with the laws of the State of Utah.

6.7      Successors and Assigns; Assignment. This Agreement will bind and insure
to the benefit of the Parties hereto and their respective legal representatives,
successors and assigns.  Other than to an affiliate,  a Party may not assign its
rights  under this  Agreement  without  the prior  written  consent of the other
Parties, which consent shall not be unreasonably withheld.

6.8      Invalid  Provision.  If any  provision of this  Agreement is held to be
illegal,  invalid or unenforceable  under present or future laws, such provision
will be fully  severable;  this  Agreement  will be construed and enforced as if
such illegal,  invalid or unenforceable  provision had never comprised a part of
this  Agreement,  and the remaining  provisions of this Agreement will remain in
full force and  effect  and will not be  affected  by such  illegal,  invalid or
unenforceable provision or by its severance from this Agreement.

         IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be
executed  by  persons  duly  empowered  to bind the  Parties  to  perform  their
respective obligations hereunder, as of the day and year first above written.

                                   SELLER:
                                   VIDEOLOCITY INTERNATIONAL, INC.

                                   By:__________________________________________

                                   Name:________________________________________

                                   Title:_______________________________________

                                   PURCHASER:
                                   Summit Media Group LLC

                                   By:__________________________________________

                                   Name:________________________________________

                                   Title:_______________________________________

                                      -5-
<PAGE>

                               SCHEDULE 1 - ASSETS
                               -------------------

All  United  States,  United  States  Territories,  and  non  US  rights  to all
intellectual property and technology, which shall include, but not be limited to
(i) its  Videolocity  Digital  Entertainment  System (DES tm), (ii)  trademarks,
trademark applications,  trade secrets, know-how,  patents, patent applications,
copyrights  and any other  intellectual  property  rights,  including High Speed
Internet Access together with digital streaming video technology,  and (iii) its
existing   license   agreements,   content   agreements   and   agreements   for
Video-On-Demand  programming for the DES, including, but not limited to, digital
movie  titles,  other  content  and  entertainment  (including  music and gaming
content).

                                      -6-EX-10.1

 

EXECUTION COPY               

 

CREDIT AGREEMENT

dated as of

November 3, 2006

among

ATARI, INC.

The Lenders Party Hereto,

GUGGENHEIM CORPORATE FUNDING, LLC,

as Administrative Agent

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 
	 	 	Page	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE I

	 
	 	 	 	 	 	 	 	 
	Definitions

	 
	 	 	 	 	 	 	 	 
	SECTION 1.01. Defined Terms
	 	 	1	 	 	 	 	 
	SECTION 1.02. Classification of Loans and Borrowings
	 	 	20	 	 	 	 	 
	SECTION 1.03. Terms Generally
	 	 	20	 	 	 	 	 
	SECTION 1.04. Accounting Terms; GAAP
	 	 	21	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE II

	 
	 	 	 	 	 	 	 	 
	The Credits

	 
	 	 	 	 	 	 	 	 
	SECTION 2.01. Commitments
	 	 	21	 	 	 	 	 
	SECTION 2.02. Loans and Borrowings
	 	 	22	 	 	 	 	 
	SECTION 2.03. Requests for Revolving Borrowings
	 	 	22	 	 	 	 	 
	SECTION 2.04. [Intentionally omitted]
	 	 	23	 	 	 	 	 
	SECTION 2.05. Letters of Credit
	 	 	23	 	 	 	 	 
	SECTION 2.06. Funding of Borrowings
	 	 	27	 	 	 	 	 
	SECTION 2.07. Interest Elections
	 	 	28	 	 	 	 	 
	SECTION 2.08. Termination and Reduction of Commitments
	 	 	29	 	 	 	 	 
	SECTION 2.09. Repayment of Loans; Evidence of Debt
	 	 	30	 	 	 	 	 
	SECTION 2.10. [Intentionally omitted]
	 	 	30	 	 	 	 	 
	SECTION 2.11. Prepayment of Loans
	 	 	30	 	 	 	 	 
	SECTION 2.12. Fees
	 	 	32	 	 	 	 	 
	SECTION 2.13. Interest
	 	 	33	 	 	 	 	 
	SECTION 2.14. Alternate Rate of Interest
	 	 	34	 	 	 	 	 
	SECTION 2.15. Increased Costs
	 	 	34	 	 	 	 	 
	SECTION 2.16. Break Funding Payments
	 	 	35	 	 	 	 	 
	SECTION 2.17. Taxes
	 	 	36	 	 	 	 	 
	SECTION 2.18. Payments Generally; Pro Rata Treatment; Sharing of Set-offs
	 	 	37	 	 	 	 	 
	SECTION 2.19. Mitigation Obligations; Replacement of Lenders
	 	 	39	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE III

	 
	 	 	 	 	 	 	 	 
	Representations and Warranties

	 
	 	 	 	 	 	 	 	 
	SECTION 3.01. Organization; Powers
	 	 	40	 	 	 	 	 
	SECTION 3.02. Authorization; Enforceability
	 	 	40	 	 	 	 	 
	SECTION 3.03. Governmental Approvals; No Conflicts
	 	 	41	 	 	 	 	 
	SECTION 3.04. Financial Condition; No Material Adverse Change
	 	 	41	 	 	 	 	 
	SECTION 3.05. Properties
	 	 	41	 	 	 	 	 
	SECTION 3.06. Litigation, Labor Matters and Environmental Matters
	 	 	42	 	 	 	 	 

i

 

	 	 	 	 	 	 	 	 	 
	 	 	Page	 	 	 	 	 
	SECTION 3.07. Compliance with Laws and Agreements; No Burdensome Restrictions
	 	 	43	 	 	 	 	 
	SECTION 3.08. Investment Company Status
	 	 	43	 	 	 	 	 
	SECTION 3.09. Taxes
	 	 	43	 	 	 	 	 
	SECTION 3.10. ERISA
	 	 	43	 	 	 	 	 
	SECTION 3.11. Disclosure
	 	 	43	 	 	 	 	 
	SECTION 3.12. No Default
	 	 	44	 	 	 	 	 
	SECTION 3.13. Liens
	 	 	44	 	 	 	 	 
	SECTION 3.14. Contingent Obligations
	 	 	44	 	 	 	 	 
	SECTION 3.15. Regulation U
	 	 	44	 	 	 	 	 
	SECTION 3.16. Solvency
	 	 	44	 	 	 	 	 
	SECTION 3.17. Insurance
	 	 	45	 	 	 	 	 
	SECTION 3.18. Collateral Documents
	 	 	45	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE IV

	 
	 	 	 	 	 	 	 	 
	Conditions

	 
	 	 	 	 	 	 	 	 
	SECTION 4.01. Effective Date
	 	 	45	 	 	 	 	 
	SECTION 4.02. Each Credit Event
	 	 	47	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE V
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Affirmative Covenants
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	SECTION 5.01. Financial Statements and Other Information
	 	 	47	 	 	 	 	 
	SECTION 5.02. Borrowing Base; Schedules
	 	 	48	 	 	 	 	 
	SECTION 5.03. Notices of Material Events
	 	 	49	 	 	 	 	 
	SECTION 5.04. Existence; Conduct of Business
	 	 	50	 	 	 	 	 
	SECTION 5.05. Payment of Obligations
	 	 	50	 	 	 	 	 
	SECTION 5.06. Maintenance of Properties; Insurance
	 	 	50	 	 	 	 	 
	SECTION 5.07. Books and Records; Inspection Rights
	 	 	51	 	 	 	 	 
	SECTION 5.08. Compliance with Laws
	 	 	51	 	 	 	 	 
	SECTION 5.09. Use of Proceeds and Letters of Credit
	 	 	51	 	 	 	 	 
	SECTION 5.10. Credit Parties Guaranty
	 	 	51	 	 	 	 	 
	SECTION 5.11. Collateral
	 	 	52	 	 	 	 	 
	SECTION 5.12. Employment Contracts
	 	 	53	 	 	 	 	 
	SECTION 5.13. Ratings
	 	 	53	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE VI

	 
	 	 	 	 	 	 	 	 
	Negative Covenants

	 
	 	 	 	 	 	 	 	 
	SECTION 6.01. Indebtedness
	 	 	53	 	 	 	 	 
	SECTION 6.02. Liens
	 	 	54	 	 	 	 	 
	SECTION 6.03. Fundamental Changes
	 	 	55	 	 	 	 	 
	SECTION 6.04. Investments, Loans, Advances, Guarantees and Acquisitions
	 	 	56	 	 	 	 	 
	SECTION 6.05. Swap Agreements
	 	 	57	 	 	 	 	 

ii

 

	 	 	 	 	 	 	 	 	 
	 	 	Page	 	 	 	 	 
	SECTION 6.06. Restricted Payments
	 	 	57	 	 	 	 	 
	SECTION 6.07. Transactions with Affiliates
	 	 	57	 	 	 	 	 
	SECTION 6.08. Restrictive Agreements
	 	 	57	 	 	 	 	 
	SECTION 6.09. Changes in Fiscal Year
	 	 	58	 	 	 	 	 
	SECTION 6.10. Asset Sales
	 	 	58	 	 	 	 	 
	SECTION 6.11. Sale and Leaseback Transactions
	 	 	59	 	 	 	 	 
	SECTION 6.12. Minimum Consolidated EBITDA
	 	 	59	 	 	 	 	 
	SECTION 6.13. Liquidity
	 	 	59	 	 	 	 	 
	SECTION 6.14. Capital Expenditures
	 	 	59	 	 	 	 	 
	SECTION 6.15. Net Revenues
	 	 	59	 	 	 	 	 
	SECTION 6.16. Subsidiaries
	 	 	60	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	ARTICLE VII

	 
	 	 	 	 	 	 	 	 
	Events of Default

	 
	 	 	 	 	 	 	 	 
	ARTICLE VIII

	 
	 	 	 	 	 	 	 	 
	The Administrative Agent

	 
	 	 	 	 	 	 	 	 
	ARTICLE IX

	 
	 	 	 	 	 	 	 	 
	Miscellaneous

	 
	 	 	 	 	 	 	 	 
	SECTION 9.01. Notices
	 	 	66	 	 	 	 	 
	SECTION 9.02. Waivers; Amendments
	 	 	67	 	 	 	 	 
	SECTION 9.03. Expenses; Indemnity; Damage Waiver
	 	 	68	 	 	 	 	 
	SECTION 9.04. Successors and Assigns
	 	 	70	 	 	 	 	 
	SECTION 9.05. Survival
	 	 	73	 	 	 	 	 
	SECTION 9.06. Counterparts; Integration; Effectiveness
	 	 	73	 	 	 	 	 
	SECTION 9.07. Severability
	 	 	73	 	 	 	 	 
	SECTION 9.08. Right of Setoff
	 	 	74	 	 	 	 	 
	SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process
	 	 	74	 	 	 	 	 
	SECTION 9.10. WAIVER OF JURY TRIAL
	 	 	74	 	 	 	 	 
	SECTION 9.11. Headings
	 	 	75	 	 	 	 	 
	SECTION 9.12. Confidentiality
	 	 	75	 	 	 	 	 
	SECTION 9.13. USA PATRIOT Act
	 	 	76	 	 	 	 	 
	SECTION 9.14. Subordination of Intercompany Indebtedness
	 	 	76	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	SCHEDULES:
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Schedule 2.01 —  Commitments
	 	 	 	 	 	 	 	 
	Schedule 3.01 —  Subsidiaries
	 	 	 	 	 	 	 	 

iii

 

	 	 	 	 	 	 	 	 	 
	 	 	Page	 	 	 	 	 
	Schedule 3.03 —  Conflicting Agreements
	 	 	 	 	 	 	 	 
	Schedule 3.05 —  Owned and Leased Properties
	 	 	 	 	 	 	 	 
	Schedule 3.06 —  Disclosed Matters
	 	 	 	 	 	 	 	 
	Schedule 3.17 —  Insurance
	 	 	 	 	 	 	 	 
	Schedule 6.01 —  Existing Indebtedness
	 	 	 	 	 	 	 	 
	Schedule 6.02 —  Existing Liens
	 	 	 	 	 	 	 	 
	Schedule 6.07 —  Affiliate Transactions
	 	 	 	 	 	 	 	 
	Schedule 6.08 —  Existing Restrictions
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	EXHIBITS:
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Exhibit A  —  Form of Assignment and Assumption
	 	 	 	 	 	 	 	 
	Exhibit B  —  Form of Borrowing Base Certificate
	 	 	 	 	 	 	 	 
	Exhibit C  —  Form of Revolving Credit Note
	 	 	 	 	 	 	 	 
	Exhibit D  —  Form of Opinion of Borrower’s Counsel
	 	 	 	 	 	 	 	 
	Exhibit E  —  Form of Compliance Certificate
	 	 	 	 	 	 	 	 
	Exhibit F  —  List of Closing Documents
	 	 	 	 	 	 	 	 

iv

 

          CREDIT AGREEMENT, dated as of November 3, 2006, among ATARI, INC., the LENDERS party hereto,
and GUGGENHEIM CORPORATE FUNDING, LLC, as Administrative Agent.

ARTICLE I

Definitions

          SECTION 1.01. Defined Terms. As used in this Agreement, the following terms have the
meanings specified below:

          “ABR”, when used in reference to any Loan or Borrowing, refers to whether such Loan,
or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to
the Alternate Base Rate.

          “Acquisition” means any acquisition (whether by purchase, merger, consolidation or
otherwise) or series of related acquisitions by the Borrower or any Subsidiary of all or
substantially all of the assets of, or all of the Equity Interests in, a Person or division or line
of business of a Person.

          “Administrative Agent” means Guggenheim Corporate Funding, LLC, in its capacity as
administrative agent for the Lenders hereunder.

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

          “Advances” shall mean and include the Revolving Loans and Letters of Credit.

          “Affected Foreign Subsidiary” means any Foreign Subsidiary to the extent that
designation of such Foreign Subsidiary as a Subsidiary Guarantor would (a) be prohibited by
applicable law or (b) cause a Deemed Dividend Problem.

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

          “Aggregate Letter of Credit Commitment” means the aggregate amount of the Letter of
Credit Commitments of all the Lenders, which aggregate amount equals Ten Million and 00/100 Dollars
($10,000,000) as of the Effective Date.

          “Aggregate Revolving Commitment” means the aggregate amount of the Revolving
Commitments of all of the Lenders, as may be reduced from time to time pursuant to the terms of
this Agreement. The initial Aggregate Revolving Commitment is Fifteen Million and 00/100 Dollars
($15,000,000) until a Term Loan in an amount agreed to by the Administrative Agent is fully funded
and thereafter Twenty-Five Million and 00/100 Dollars ($25,000,000).

 

 

          “Aggregate Term Loan Commitment” means the aggregate amount of the Term Loan
Commitments of all of the Lenders.

          “Alternate Base Rate” means, for any day, a rate per annum equal to the greater of (a)
the Prime Rate in effect on such day and (b) the Federal Funds Effective Rate in effect on such day
plus 1/2 of 1%. Any change in the Alternate Base Rate due to a change in the Prime Rate or
the Federal Funds Effective Rate shall be effective from and including the effective date of such
change in the Prime Rate or the Federal Funds Effective Rate, respectively.

          “Applicable Percentage” means, with respect to any Lender, the percentage of the total
Commitments represented by such Lender’s Commitment. If the Commitments have terminated or
expired, the Applicable Percentages shall be determined based upon the Commitments most recently in
effect, giving effect to any assignments.

          “Applicable Rate” means, for any day, the following per annum rates for the following
Obligations:

	 	 	 	 	 	 	 	 	 
	 	 	APPLICABLE RATE
	 	 	FOR EURODOLLAR	 	FOR ABR
	TYPE OF OBLIGATION	 	BORROWING	 	BORROWING
	Revolving Loan
	 	 	5.00	%	 	 	2.25	%
	Participation Fee for Letters of Credit
	 	 	5.00	%	 	 	 	 

          If the parties to the trademark license agreement among the Borrower, the Parent and Atari
Interactive, Inc. agree under terms reasonably acceptable to the Administrative Agent to extend the
license agreement beyond its current maturity of 2013, then the interest rate or rates applicable
to the Loans shall be reduced on a blended basis, based on the Aggregate Revolving Commitment and
the Aggregate Term Loan Commitment, by 0.50% per annum if the extension is for five years or more,
1.00% per annum if the extension is for ten years or more or 1.25% per annum if the extension is
for fifteen years or more. If the Borrower purchases the Atari brand, trademark and intellectual
property from Atari Interactive, Inc. on terms and with financing reasonably acceptable to the
Administrative Agent, the Administrative Agent agrees to enter into negotiations with the goal,
subject to the Borrower’s business prospects and approval of the Administrative Agent’s Credit
Committee of reducing the interest rate or rates applicable to the Loans so that the blended rate
based on the Maximum Aggregate Revolving Commitment and the Aggregate Term Loan Commitment would be
the LIBO Rate plus 5.00% per annum.

          “Approved Fund” has the meaning assigned to such term in Section 9.04.

          “Assignment and Assumption” means an assignment and assumption entered into by a
Lender and an assignee (with the consent of any party whose consent is required by Section 9.04),
and accepted by the Administrative Agent, in the form of Exhibit A hereto or any other form
approved by the Administrative Agent.

2

 

          “Availability Period” means the period from and including the Effective Date to but
excluding the earlier of the Maturity Date and the date of termination of the Commitments.

          “Board” means the Board of Governors of the Federal Reserve System of the United
States of America.

          “Borrower” means Atari, Inc., a Delaware corporation.

          “Borrowing” means Loans of the same Class and Type, made, converted or continued on
the same date and, in the case of Eurodollar Loans, as to which a single Interest Period is in
effect.

          “Borrowing Base Certificate” shall mean a certificate duly executed by an officer of
Borrower appropriately completed and in substantially the form of Exhibit B.

          “Borrowing Request” means a request by the Borrower for a Revolving Borrowing in
accordance with Section 2.03.

          “Business Day” means any day that is not a Saturday, Sunday or other day on which
commercial banks in New York City are authorized or required by law to remain closed;
provided that, when used in connection with a Eurodollar Loan, the term “Business
Day” shall also exclude any day on which banks are not open for dealings in dollar deposits in
the London interbank market.

          “Capital Expenditures” means, without duplication, any expenditures for any purchase
or other acquisition of any asset which would be classified as a fixed or capital asset on a
consolidated balance sheet of the Borrower and its consolidated Subsidiaries prepared in accordance
with GAAP.

          “Capital Lease Obligations” of any Person means the obligations of such Person to pay
rent or other amounts under any lease of (or other arrangement conveying the right to use) real or
personal property, or a combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP, and the amount of
such obligations shall be the capitalized amount thereof determined in accordance with GAAP.

          “Change in Control” means (a) the acquisition of ownership, directly or indirectly,
beneficially or of record, by any Person or group (within the meaning of the Securities Exchange
Act of 1934 and the rules of the Securities and Exchange Commission thereunder as in effect on the
date hereof), of Equity Interests representing more than 30% of the aggregate ordinary voting power
represented by the issued and outstanding Equity Interests of the Borrower; (b) occupation of a
majority of the seats (other than vacant seats) on the board of directors of the Borrower by
Persons who were neither (i) nominated by the board of directors nor (ii) appointed by directors so
nominated; or (b) the acquisition of direct or indirect Control of the Borrower by any Person or
group.

          “Change in Law” means (a) the adoption of any law, rule or regulation after the date
of this Agreement, (b) any change in any law, rule or regulation or in the interpretation or

3

 

application thereof by any Governmental Authority after the date of this Agreement or (c)
compliance by any Lender or the Issuing Lender (or, for purposes of Section 2.15(b), by any lending
office of such Lender or by such Lender’s or the Issuing Lender’s holding company, if any) with any
request, guideline or directive (whether or not having the force of law) of any Governmental
Authority made or issued after the date of this Agreement.

          “Class”, when used in reference to any (a) Loan or Borrowing, refers to whether such
Loan, or the Loans comprising such Borrowing, are Revolving Loans or Term Loans, or (b) Commitment,
refers to whether such Commitment is a Revolving Commitment or a Term Loan Commitment.

          “Code” means the Internal Revenue Code of 1986, as amended from time to time.

          “Collateral” means all property and interests in property now owned or hereafter
acquired by any Credit Party in or upon which a security interest or Lien or mortgage is from time
to time granted to the Administrative Agent, for the benefit of the Holders of Obligations, whether
under the Pledge and Security Agreement, under any of the other Collateral Documents or under any
of the other Loan Documents.

          “Collateral Documents” means all agreements, instruments and documents executed in
connection with this Agreement pursuant to which the Administrative Agent is granted a security
interest in Collateral, including, the Pledge and Security Agreement, and all other security
agreements, loan agreements, notes, guarantees, subordination agreements, pledges, powers of
attorney, consents, assignments, contracts, fee letters, notices, leases, financing statements and
all other written matter whether heretofore, now, or hereafter executed by or on behalf of the
Borrower or any of its Subsidiaries and delivered to the Administrative Agent or any of the
Lenders, together with all agreements and documents referred to therein or contemplated thereby.

          “Commitment” means a Revolving Commitment and/or a Term Loan Commitment, as
applicable.

          “Consolidated Capital Expenditures” means, with reference to any period, the Capital
Expenditures of the Borrower and its consolidated Subsidiaries calculated on a consolidated basis
for such period.

          “Consolidated EBITDA” means Consolidated Net Income plus, to the extent
deducted from revenues in determining Consolidated Net Income, (i) Consolidated Interest Expense,
(ii) expense for taxes paid or accrued, (iii) depreciation, (iv) amortization, (v) extraordinary
losses, (vi) charges in Borrower’s third fiscal quarter of 2006 for discontinued operations in an
amount not to exceed $363,000, and (vii) restructuring charges in Borrower’s third and fourth
fiscal quarters of 2006 in an amount not to exceed $60,000 for either fiscal quarter minus,
to the extent included in Consolidated Net Income, extraordinary gains, all calculated for the
Borrower and its consolidated Subsidiaries on a consolidated basis.

          “Consolidated Interest Expense” means, with reference to any period, the interest
expense (including interest expense under Capital Lease Obligations that is treated as interest in

4

 

accordance with GAAP) of the Borrower and its consolidated Subsidiaries calculated on a
consolidated basis for such period.

          “Consolidated Net Income” means, with reference to any period, the net income (or
loss) of the Borrower and its consolidated Subsidiaries calculated on a consolidated basis for such
period in accordance with GAAP.

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

          “Credit Parties Guaranty” means that certain Guaranty (and any and all supplements
thereto) dated as of the Effective Date and executed by each Subsidiary Guarantor, and, in the case
of any guaranty by a Foreign Subsidiary, any other guaranty agreements as are requested by the
Administrative Agent and its counsel, in each case as amended, restated, supplemented or otherwise
modified from time to time.

          “Credit Party” means the Borrower, the Subsidiary Guarantors and any other Subsidiary
required to become a Credit Party pursuant to Sections 5.09 and 5.10.

          “Customer” shall mean and include the account debtor with respect to any Receivable
and/or the prospective purchaser of goods, services or both with respect to any contract or
contract right, and/or any party who enters into or proposes to enter into any contract or other
arrangement with Borrower, pursuant to which Borrower is to deliver any personal property or
perform any services.

          “Customs” shall mean the United States of America Customs Department.

          “Deemed Dividend Problem” means, with respect to any Foreign Subsidiary, such Foreign
Subsidiary’s accumulated and undistributed earnings and profits being deemed to be repatriated to
the Borrower or the applicable parent Domestic Subsidiary under Section 956 of the Code and the
effect of such repatriation causing adverse tax consequences to the Borrower or such parent
Domestic Subsidiary, in each case as determined by the Borrower in its commercially reasonable
judgment acting in good faith and in consultation with its legal and tax advisors.

          “Default” means any event or condition which constitutes an Event of Default or which
upon notice, lapse of time or both would, unless cured or waived, become an Event of Default.

          “Disclosed Matters” means the actions, suits and proceedings and the environmental
matters disclosed in Schedule 3.06.

          “Dollars,” “dollars,” or “$” refers to lawful money of the United
States of America.

5

 

          “Domestic Subsidiary” means a Subsidiary organized under the laws of a jurisdiction
located in the United States of America.

          “Effective Date” means the date on which the conditions specified in Section 4.01 are
satisfied (or waived in accordance with Section 9.02).

          “Eligible Receivables” shall mean and include with respect to Borrower, each
Receivable of Borrower arising in the ordinary course of Borrower’s business and which Lender, in
its sole credit judgment which shall be exercised in a commercially reasonable manner, shall deem
to be an Eligible Receivable, based on such considerations as Lender may from time to time deem
appropriate. A Receivable shall not be deemed eligible unless such Receivable is subject to
Lender’s first priority perfected security interest and no other Lien (other than Liens permitted
by Section 6.02 or by the Collateral Documents), and is evidenced by an invoice or other
documentary evidence reasonably satisfactory to Lender. In addition, no Receivable shall be an
Eligible Receivable if:

               (a) it arises out of a sale made by Borrower to (i) an Affiliate of Borrower or (ii) a
Person controlled by an Affiliate of Borrower;

               (b) it is due or unpaid more than sixty (60) days after the due date;

               (c) fifty percent (50%) or more of the Receivables from such Customer are not deemed
Eligible Receivables hereunder. Such percentage may, in Lender’s sole discretion, be
increased or decreased from time to time;

               (d) any covenant, representation or warranty contained in this Agreement with respect
to such Receivable has been breached;

               (e) the Customer shall (i) apply for, suffer, or consent to the appointment of, or the
taking of possession by, a receiver, custodian, trustee or liquidator of itself or of all or
a substantial part of its property or call a meeting of its creditors, (ii) admit in writing
its inability, or be generally unable, to pay its debts as they become due or cease
operations of its present business, (iii) make a general assignment for the benefit of
creditors, (iv) commence a voluntary case under any state or federal bankruptcy laws (as now
or hereafter in effect), (v) be adjudicated a bankrupt or insolvent, (vi) file a petition
seeking to take advantage of any other law providing for the relief of debtors, (vii)
acquiesce to, or fail to have dismissed within 60 days after the filing thereof, any
petition which is filed against it in any involuntary case under such bankruptcy laws, or
(viii) take any action for the purpose of effecting any of the foregoing;

               (f) the sale is to a Customer outside the United States of America or Canada, unless
the sale is on letter of credit, guaranty or acceptance terms, in each case acceptable to
Lender in its sole discretion;

               (g) the sale to the Customer is on a bill-and-hold, guaranteed sale, sale-and-return,
sale on approval, consignment or any other repurchase or return basis or is evidenced by
chattel paper;

6

 

               (h) Lender believes, in its sole judgment, that collection of such Receivable is
insecure or that such Receivable may not be paid by reason of the Customer’s financial
inability to pay;

               (i) the Customer is the United States of America, any state or any department, agency
or instrumentality of any of them, unless Borrower assigns its right to payment of such
Receivable to Lender pursuant to the Assignment of Claims Act of 1940, as amended (31 U.S.C.
Sub-Section 3727 et seq. and 41 U.S.C. Sub-Section 15 et seq.) or
has otherwise complied with other applicable statutes or ordinances;

               (j) the goods giving rise to such Receivable have not been shipped to the Customer or
the services giving rise to such Receivable have not been performed by Borrower or the
Receivable otherwise does not represent a final sale;

               (k) the Receivables of the Customer exceed a credit limit determined by Lender, in its
sole discretion, to the extent such Receivable exceeds such limit;

               (l) the Receivable is subject to any offset, deduction, defense, dispute, or
counterclaim or the Customer is also a creditor or supplier of Borrower, except, in the case
of any of the foregoing, to the extent the Customer has waived the right of setoff in a
manner reasonably satisfactory to Lender, and in each such case only to the extent of such
offset, deduction, defense, dispute, or counterclaim; or the Receivable is contingent in any
respect or for any reason;

               (m) Borrower has made any agreement with any Customer for any deduction therefrom (but
only to the extent of such deduction), except for discounts or allowances made in the
ordinary course of business for prompt payment, all of which discounts or allowances are
reflected in the calculation of the face value of each respective invoice related thereto;

               (n) any return, rejection or repossession of the merchandise covered by such Receivable
has occurred, to the extent of the invoiced value of such returned, rejected or repossessed
merchandise;

               (o) such Receivable is not payable to Borrower; or

               (p) such Receivable is not otherwise satisfactory to Lender as determined in good faith
by Lender in the exercise of its discretion in a reasonable manner.

          “Environmental Laws” means all laws, rules, regulations, codes, ordinances, orders,
decrees, judgments, injunctions, notices or binding agreements issued, promulgated or entered into
by any Governmental Authority, relating in any way to the environment, preservation or reclamation
of natural resources, the management, release or threatened release of any Hazardous Material or to
health and safety matters.

          “Environmental Liability” means any liability, contingent or otherwise (including any
liability for damages, costs of environmental remediation, fines, penalties or indemnities), of

7

 

the Borrower or any Subsidiary directly or indirectly resulting from or based upon (a)
violation of any Environmental Law, (b) the generation, use, handling, transportation, storage,
treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the
release or threatened release of any Hazardous Materials into the environment or (e) any contract,
agreement or other consensual arrangement pursuant to which liability is assumed or imposed with
respect to any of the foregoing.

          “Equity Interests” means shares of capital stock, partnership interests, membership
interests in a limited liability company, beneficial interests in a trust or other equity ownership
interests in a Person, and any warrants, options or other rights entitling the holder thereof to
purchase or acquire any such equity interest.

          “ERISA” means the Employee Retirement Income Security Act of 1974, as amended from
time to time.

          “ERISA Affiliate” means any trade or business (whether or not incorporated) that,
together with the Borrower, is treated as a single employer under Section 414(b) or (c) of the Code
or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single
employer under Section 414 of the Code.

          “ERISA Event” means (a) any “reportable event”, as defined in Section 4043 of ERISA or
the regulations issued thereunder with respect to a Plan (other than an event for which the 30-day
notice period is waived); (b) the existence with respect to any Plan of an “accumulated funding
deficiency” (as defined in Section 412 of the Code or Section 302 of ERISA), whether or not waived;
(c) the filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an application
for a waiver of the minimum funding standard with respect to any Plan; (d) the incurrence by the
Borrower or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to
the termination of any Plan; (e) the receipt by the Borrower or any ERISA Affiliate from the PBGC
or a plan administrator of any notice relating to an intention to terminate any Plan or Plans or to
appoint a trustee to administer any Plan; (f) the incurrence by the Borrower or any of its ERISA
Affiliates of any liability with respect to the withdrawal or partial withdrawal from any Plan or
Multiemployer Plan; or (g) the receipt by the Borrower or any ERISA Affiliate of any notice, or the
receipt by any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice,
concerning the imposition of Withdrawal Liability or a determination that a Multiemployer Plan is,
or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA.

          “Eurodollar”, when used in reference to any Loan or Borrowing, refers to whether such
Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by
reference to the LIBO Rate.

          “Event of Default” has the meaning assigned to such term in Article VII.

          “Excluded Taxes” means, with respect to the Administrative Agent, any Lender, the
Issuing Lender or any other recipient of any payment to be made by or on account of any obligation
of the Borrower hereunder, (a) income or franchise taxes imposed on (or measured by) its net income
by the United States of America, or by the jurisdiction under the laws of

8

 

which such recipient is organized or in which its principal office is located or, in the case
of any Lender, in which its applicable lending office is located, (b) any branch profits taxes
imposed by the United States of America or any similar tax imposed by any other jurisdiction in
which the Borrower is located and (c) in the case of a Foreign Lender (other than an assignee
pursuant to a request by the Borrower under Section 2.19(b)), any withholding tax that is imposed
on amounts payable to such Foreign Lender at the time such Foreign Lender becomes a party to this
Agreement (or designates a new lending office) or is attributable to such Foreign Lender’s failure
to comply with Section 2.17(e), except to the extent that such Foreign Lender (or its assignor, if
any) was entitled, at the time of designation of a new lending office (or assignment), to receive
additional amounts from the Borrower with respect to such withholding tax pursuant to Section
2.17(a).

          “Federal Funds Effective Rate” means, for any day, the weighted average (rounded
upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal funds brokers, as
published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day that is a Business Day, the average (rounded upwards, if
necessary, to the next 1/100 of 1%) of the quotations for such day for such transactions received
by the Administrative Agent from three Federal funds brokers of recognized standing selected by it.

          “Financial Assistance Problem” means, with respect to any Foreign Subsidiary, the
inability of such Foreign Subsidiary to become a Subsidiary Guarantor or to permit its Equity
Interests from being pledged pursuant to a pledge agreement on account of legal or financial
limitations imposed by the jurisdiction of organization of such Foreign Subsidiary or other
relevant jurisdictions having authority over such Foreign Subsidiary, in each case as determined by
the Borrower in its commercially reasonable judgment acting in good faith and in consultation with
its legal and tax advisors.

          “Financial Officer” means the chief executive officer, chief financial officer (or
acting chief financial officer), president, controller or treasurer of the Borrower.

          “Financials” means the annual or quarterly or monthly financial statements, and
accompanying certificates and other documents, of the Borrower required to be delivered pursuant to
Section 5.01(a), 5.01(b) or 5.01(d).

          “Foreign Lender” means any Lender that is organized under the laws of a jurisdiction
other than that in which the Borrower is located. For purposes of this definition, the United
States of America, each State thereof and the District of Columbia shall be deemed to constitute a
single jurisdiction.

          “Foreign Subsidiary” means any Subsidiary which is not a Domestic Subsidiary.

          “Formula Amount” shall have the meaning set forth in Section 2.01(a).

          “GAAP” means generally accepted accounting principles in the United States of America.

9

 

          “Governmental Authority” means the government of the United States of America, any
other nation or any political subdivision thereof, whether state or local, and any agency,
authority, instrumentality, regulatory body, court, central bank or other entity exercising
executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or
pertaining to government.

          “Guarantee” of or by any Person (the “guarantor”) means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic effect of
guaranteeing any Indebtedness or other obligation of any other Person (the “primary
obligor”) in any manner, whether directly or indirectly, and including any obligation of the
guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase
or payment of) such Indebtedness or other obligation or to purchase (or to advance or supply funds
for the purchase of) any security for the payment thereof, (b) to purchase or lease property,
securities or services for the purpose of assuring the owner of such Indebtedness or other
obligation of the payment thereof, (c) to maintain working capital, equity capital or any other
financial statement condition or liquidity of the primary obligor so as to enable the primary
obligor to pay such Indebtedness or other obligation or (d) as an account party in respect of any
letter of credit or letter of guaranty issued to support such Indebtedness or obligation;
provided, that the term Guarantee shall not include endorsements for collection or deposit
in the ordinary course of business.

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

          “Holders of Obligations” means the holders of the Obligations from time to time and
shall include (i) each Lender and the Issuing Lender in respect of its Loans, Deposit and LC
Exposure, (ii) the Administrative Agent and the Lenders in respect of all other present and future
obligations and liabilities of the Borrower and each Subsidiary of every type and description
arising under or in connection with the Credit Agreement or any other Loan Document, (iii) each
Lender and affiliate of such Lender in respect of Swap Agreements entered into with such Person by
the Borrower or any Subsidiary, (iv) each indemnified party under Section 9.03 in respect of the
obligations and liabilities of the Borrower to such Person hereunder and under the other Loan
Documents, and (v) their respective successors and (in the case of a Lender, permitted) transferees
and assigns.

          “Hostile Acquisition” means (a) the acquisition of the Equity Interests of a Person
through a tender offer or similar solicitation of the owners of such Equity Interests which has not
been approved by the board of directors (or any other applicable governing body) of such Person or
by similar action if such Person is not a corporation or (b) any such acquisition as to which such
approval has been withdrawn.

          “Indebtedness” of any Person means, without duplication, (a) all obligations of such
Person for borrowed money or with respect to deposits or advances of any kind, (b) all obligations
of such Person evidenced by preferred stock, bonds, debentures, notes or similar

10

 

instruments, (c) all obligations of such Person upon which interest charges are customarily
paid, (d) all obligations of such Person under conditional sale or other title retention agreements
relating to property acquired by such Person, (e) all obligations of such Person in respect of the
deferred purchase price of property or services (excluding current accounts payable incurred in the
ordinary course of business), (f) all Indebtedness of others secured by (or for which the holder of
such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on
property owned or acquired by such Person, up to the value of the property subject to such Lien or,
if greater, the Indebtedness secured thereby that is assumed by such Person, (g) all Guarantees by
such Person of Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i) all
obligations, contingent or otherwise, of such Person as an account party in respect of letters of
credit and letters of guaranty, (j) all obligations, contingent or otherwise, of such Person in
respect of bankers’ acceptances, and (k) all Off-Balance Sheet Liabilities of such Person. The
Indebtedness of any Person shall include the Indebtedness of any other entity (including any
partnership in which such Person is a general partner) to the extent such Person is liable therefor
as a result of such Person’s ownership interest in or other relationship with such entity, except
to the extent the terms of such Indebtedness provide that such Person is not liable therefor.

          “Indemnified Taxes” means Taxes other than Excluded Taxes.

          “Insolvency Event” has the meaning assigned to such term in Section 9.14.

          “Intercompany Indebtedness” has the meaning assigned to such term in Section 9.14.

          “Interest Election Request” means a request by the Borrower to convert or continue a
Borrowing in accordance with Section 2.07.

          “Interest Payment Date” means with respect to any ABR Loan or Eurodollar Loan, the
last Business Day of each calendar month.

          “Interest Period” means, with respect to any Eurodollar Borrowing, the period
commencing on the date of such Borrowing and ending on the numerically corresponding day in the
calendar month that is one, two, three or six months thereafter, as the Borrower may elect;
provided, that (i) if any Interest Period would end on a day other than a Business Day,
such Interest Period shall be extended to the next succeeding Business Day unless, in the case of a
Eurodollar Borrowing only, such next succeeding Business Day would fall in the next calendar month,
in which case such Interest Period shall end on the next preceding Business Day and (ii) any
Interest Period pertaining to a Eurodollar Borrowing that commences on the last Business Day of a
calendar month (or on a day for which there is no numerically corresponding day in the last
calendar month of such Interest Period) shall end on the last Business Day of the last calendar
month of such Interest Period. For purposes hereof, the date of a Borrowing initially shall be the
date on which such Borrowing is made and thereafter shall be the effective date of the most recent
conversion or continuation of such Borrowing.

          “Issuing Lender” means one of the Lenders designated by the Administrative Agent, in
its capacity as the issuer of Letters of Credit hereunder, and its successors in such

11

 

capacity as provided in Section 2.05(i). The Issuing Lender may, in its discretion, arrange
for one or more Letters of Credit to be issued by an Underlying Issuer by entering into a risk
participation or other arrangement with such Underlying Issuer to reimburse such Underlying Issuer
in respect of Letters of Credit.

          “LC Disbursement” means a payment made by the Issuing Lender pursuant to a Letter of
Credit.

          “LC Exposure” means, at any time, the sum of (a) the aggregate undrawn amount of all
outstanding Letters of Credit at such time plus (b) the aggregate amount of all LC
Disbursements that have not yet been reimbursed by or on behalf of the Borrower at such time. The
LC Exposure of any Lender at any time shall be its Applicable Percentage of the total LC Exposure
at such time.

          “Lenders” means the Persons listed on Schedule 2.01 and any other Person that
shall have become a party hereto pursuant to an Assignment and Assumption in accordance with the
terms of this Agreement, other than any such Person that ceases to be a party hereto pursuant to an
Assignment and Assumption.

          “Letter of Credit” means any letter of credit issued pursuant to this Agreement.

          “LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest Period,
the rate appearing on Page 3750 of the Dow Jones Market Service (or on any successor or substitute
page of such Service, or any successor to or substitute for such Service, providing rate quotations
comparable to those currently provided on such page of such Service, as determined by the
Administrative Agent from time to time for purposes of providing quotations of interest rates
applicable to dollar deposits in the London interbank market) at approximately 11:00 a.m., London
time, two Business Days prior to the commencement of such Interest Period, as the rate for dollar
deposits with a maturity comparable to such Interest Period. In the event that such rate is not
available at such time for any reason, then the “LIBO Rate” with respect to such Eurodollar
Borrowing for such Interest Period shall be the rate at which dollar deposits of $5,000,000 and for
a maturity comparable to such Interest Period are offered by the principal London office of the
Administrative Agent in immediately available funds in the London interbank market at approximately
11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period.

          “Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien,
pledge, hypothecation, encumbrance, charge or security interest in, on or of such asset, (b) the
interest of a vendor or a lessor under any conditional sale agreement, capital lease or title
retention agreement (or any financing lease having substantially the same economic effect as any of
the foregoing) relating to such asset and (c) in the case of securities, any purchase option, call
or similar right of a third party with respect to such securities.

          “Loan Documents” means this Agreement, any promissory notes executed and delivered
pursuant to Section 2.09(e), the Collateral Documents, the Credit Parties Guaranty, and any and all
other instruments and documents executed and delivered in connection with any of the foregoing.

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          “Loans” means the loans made by the Lenders to the Borrower pursuant to this
Agreement.

          “Material Adverse Effect” means a material adverse effect on (a) the business, assets,
operations, performance, prospects or condition (financial or otherwise) of the Borrower and the
Subsidiaries taken as a whole, (b) the ability of the Borrower to perform any of its obligations
under this Agreement or (c) the validity or enforceability of this Agreement or the rights of or
benefits available to the Administrative Agent and the Lenders under this Agreement and the other
Loan Documents.

          “Material Indebtedness” means Indebtedness (other than the Loans and Letters of
Credit), or obligations in respect of one or more Swap Agreements, of any one or more of the
Borrower and its Subsidiaries in an aggregate principal amount exceeding $1,000,000. For purposes
of determining Material Indebtedness, the “principal amount” of the obligations of the Borrower or
any Subsidiary in respect of any Swap Agreement at any time shall be the maximum aggregate amount
(giving effect to any netting agreements) that the Borrower or such Subsidiary would be required to
pay if such Swap Agreement were terminated at such time.

          “Maturity Date” means November 3, 2009.

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

          “Multiemployer Plan” means a multiemployer plan as defined in Section 4001(a)(3) of
ERISA.

          “Net Debt” means, with reference to any date of determination, (i) all Indebtedness of
the Borrower minus (ii) the aggregate amount of all cash and cash equivalents held by the
Borrower.

          “Net Proceeds” means, with respect to any event (a) the cash proceeds received in
respect of such event including (i) any cash received in respect of any non-cash proceeds, but only
as and when received, (ii) in the case of a casualty, insurance proceeds, and (iii) in the case of
a condemnation or similar event, condemnation awards and similar payments, net of (b) the sum of
(i) all fees and out-of-pocket expenses paid by the Borrower and the Subsidiaries to third parties
(other than fees and expenses paid to Affiliates at prices or on terms and conditions less
favorable to the Borrower or any such Subsidiary than could be obtained on an arm’s-length basis
from unrelated third parties) in connection with such event, (ii) in the case of a sale, transfer
or other disposition of an asset (including pursuant to a sale and leaseback transaction or a
casualty or a condemnation or similar proceeding), the amount of all payments required to be made
by the Borrower and the Subsidiaries as a result of such event to repay Indebtedness (other than
Loans) secured by such asset, and (iii) the amount of all taxes paid (or reasonably estimated to be
payable) by the Borrower and the Subsidiaries, and the amount of any reserves established by the
Borrower and the Subsidiaries to fund contingent liabilities reasonably estimated to be payable
that are directly attributable to such event (as determined reasonably and in good faith by a
Financial Officer); provided that “Net Proceeds” shall include on a dollar-for-dollar basis all
amounts remaining in such reserve after such liability shall have been satisfied in full or
terminated.

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          “Obligations” means all Loans, LC Disbursements, advances, debts, liabilities,
obligations, covenants and duties owing by the Borrower or any Subsidiary to the Administrative
Agent, any Lender, the Issuing Lender, any Affiliate of the Administrative Agent or any Lender, the
Issuing Lender, or any indemnified Person hereunder, of any kind or nature, present or future,
arising under this Agreement, any Collateral Document, any Swap Agreement (to the extent such Swap
Agreement is with a Lender or its Affiliate) or any other Loan Document, including obligations
owing to Lenders under Section 2.05, whether or not evidenced by any note, guaranty or other
instrument, whether or not for the payment of money, whether arising by reason of an extension of
credit, loan, guaranty, indemnification, or in any other manner, whether direct or indirect
(including those acquired by assignment), absolute or contingent, due or to become due, now
existing or hereafter arising and however acquired. The term includes all interest, charges,
expenses, fees, reasonable attorneys’ fees and disbursements, reasonable paralegals’ fees (in each
case whether or not allowed), and any other sum chargeable to the Borrower or any Subsidiary under
this Agreement or any other Loan Document.

          “Off-Balance Sheet Liabilities” of a Person means (a) any repurchase obligation or
liability of such Person or any Subsidiary thereof with respect to receivables sold by such Person
or such Subsidiary, (b) any liability under any sale and leaseback transaction which does not
create a liability on the consolidated balance sheet of such Person or any Subsidiary thereof, (c)
any liability of such Person or any Subsidiary thereof under any financing lease, so-called
“synthetic” lease or “tax ownership operating lease” transaction, (d) any obligation under a
receivables purchase facility or other similar asset securitization transaction that would be
characterized as principal if such facility were structured as a secured lending transaction rather
than a purchase, or (e) any obligation of such Person or any Subsidiary thereof arising with
respect to any other transaction which is the functional equivalent of or takes the place of
borrowing but which, in the case of the foregoing clauses, does not constitute a liability on the
consolidated balance sheet of such Person or any Subsidiary thereof.

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

          “Parent” shall mean Infogrames Entertainment S.A., a French corporation.

          “Participant” has the meaning set forth in Section 9.04.

          “PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA
and any successor entity performing similar functions.

          “Permitted Acquisition” means any Acquisition (excluding in any event a Hostile
Acquisition) if, at the time of and immediately after giving effect thereto, (a) no Default has
occurred and is continuing or would arise after giving effect thereto, (b) the principal business
of such Person shall be in the same line of business as, or otherwise reasonably related to, a
business in which the Borrower is engaged on the Effective Date, (c) each Subsidiary formed for the
purpose of or resulting from such Acquisition shall (i) to the extent required by Section 5.10,
become a Subsidiary Guarantor and (ii) to the extent required by Section 5.11, grant a first-

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priority perfected security interest (subject in any case to Liens permitted by Section 6.02
or by the Collateral Documents) in all of its owned property, and all of the Equity Interests of
such Subsidiary shall be owned directly by the Borrower or, to the extent so required by such
definition, a Subsidiary Guarantor, and all actions required to be taken with respect to such
acquired or newly formed Subsidiary under Sections 5.10 and 5.11 shall have been taken, (d) the
Borrower and the Subsidiaries are in compliance, on a pro forma basis acceptable to the
Administrative Agent after giving effect to such Acquisition, with the covenants contained in
Sections 6.12, 6.13, 6.14, 6.15 and 6.16 recomputed as of the last day of the most recently ended
fiscal quarter of the Borrower for which financial statements are available, as if such Acquisition
(and any related incurrence or repayment of Indebtedness, with any new Indebtedness being deemed to
be amortized over the applicable testing period in accordance with its terms) had occurred on the
first day of each relevant period for testing such compliance, (e) no material challenge to such
Acquisition (excluding the exercise of appraisal rights) shall be pending or threatened by any
shareholder or director of the seller or Person to be acquired, (f) all material governmental and
corporate approvals required in connection therewith shall have been obtained, and (g) the Borrower
has delivered to the Administrative Agent an officers’ certificate certifying as to clauses (a),
(b), (c), (d), (e) and (f) above, together with all relevant financial information for the Person
or assets to be acquired and reasonably detailed calculations demonstrating satisfaction of the
requirements described herein.

          “Permitted Encumbrances” means:

          (a) Liens imposed by law for taxes that are not yet due or are being contested in compliance
with Section 5.05;

          (b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other like Liens
imposed by law, arising in the ordinary course of business and securing obligations that are not
overdue by more than 30 days or are being contested in compliance with Section 5.05;

          (c) pledges and deposits made in the ordinary course of business in compliance with workers’
compensation, unemployment insurance and other social security laws or regulations;

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

          (e) judgment liens in respect of judgments that do not constitute an Event of Default under
clause (k) of Article VII;

          (f) easements, zoning restrictions, rights-of-way and similar encumbrances on real property
imposed by law or arising in the ordinary course of business that do not secure any monetary
obligations and do not materially detract from the value of the affected property or interfere with
the ordinary conduct of business of the Borrower or any Subsidiary; and

          (g) Liens in favor of the Administrative Agent for the benefit of the Holders of Obligations.

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provided that, except as set forth in clause (g) above, the term “Permitted Encumbrances”
shall not include any Lien securing Indebtedness.

          “Permitted Investments” means:

          (a) direct obligations of, or obligations the principal of and interest on which are
unconditionally guaranteed by, the United States of America, in each case maturing within one year
from the date of acquisition thereof;

          (b) investments in commercial paper maturing within 270 days from the date of acquisition
thereof and having, at such date of acquisition, a rating of at least A-2 from S&P and at least P-2
from Moody’s;

          (c) investments in certificates of deposit, banker’s acceptances and time deposits maturing
within 180 days from the date of acquisition thereof issued or guaranteed by or placed with, and
money market deposit accounts issued or offered by, any domestic office of any commercial bank
organized under the laws of the United States of America or any State thereof which has a combined
capital and surplus and undivided profits of not less than $500,000,000;

          (d) fully collateralized repurchase agreements with a term of not more than 30 days for
securities described in clause (a) above and entered into with a financial institution satisfying
the criteria described in clause (c) above;

          (e) money market funds that (i) comply with the criteria set forth in Securities and Exchange
Commission Rule 2a-7 under the Investment Company Act of 1940, (ii) are rated AAA by S&P and Aaa by
Moody’s and (iii) have portfolio assets of at least $5,000,000,000;

          (f) in the case of investments of any Foreign Subsidiary or non-domestic branch of the
Borrower, securities issued by any foreign government or any political subdivision of any foreign
government or any public instrumentality thereof having maturities of not more than one year from
the date of acquisition thereof and, at the time of acquisition thereof, having an investment grade
credit rating obtainable from S&P, Moody’s, or other generally recognized rating agency; and

          (g) in the case of investments by any Foreign Subsidiary or non-domestic branch of the
Borrower, investments in time deposits maturing within one year from the date of acquisition
thereof issued or guaranteed by or placed with any highly capitalized commercial bank which is
located in the jurisdiction where such non-domestic branch of the Borrower or such Foreign
Subsidiary is located and which bank has an investment grade credit rating obtainable from S&P,
Moody’s or other generally recognized rating agency.

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

          “Plan” means any employee pension benefit plan (other than a Multiemployer Plan)
subject to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA,
and in respect of which the Borrower or any ERISA Affiliate is (or,
if such plan were terminated, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in
Section 3(5) of ERISA.

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          “Pledge and Security Agreement” means that certain Pledge and Security Agreement,
dated as of the Effective Date, by and among the Credit Parties party thereto and the
Administrative Agent for the benefit of the Holders of Obligations, as the same may be amended,
restated, supplemented or otherwise modified from time to time.

          “Prime Rate” means for any day the prime rate as published for each Business Day (or
if such a day is not a Business Day, the immediately preceding Business Day) in the Wall Street
Journal under the caption “Money Rates, Prime Rate.”

          “Pro Forma EBITDA” means, with respect to any target entity acquired pursuant to a
Permitted Acquisition, the amount of such target’s EBITDA for the most recent trailing four (4)
fiscal quarter period ending as of the last day of the fiscal quarter preceding the closing of the
respective Permitted Acquisition for which financial statements are available, adjusted as provided
herein. Such amount shall be determined by the Borrower and shall be subject to the consent of the
Administrative Agent acting in good faith, based upon and derived from financial information
delivered to the Administrative Agent prior to the consummation of such Permitted Acquisition. In
each instance, such target’s historical EBITDA shall be adjusted by: (x) verifiable cost savings
attributable to operating efficiencies reasonably expected to be realized by such target as
operated and controlled by the Borrower or by a Subsidiary of the Borrower and (y) an amount which
gives effect to the prorating of any year end adjustments made to the most recent annual financial
statements of such target and which should have been accrued during such year in accordance with
GAAP, all of which shall be reasonably determined by the Borrower, and must be consented to by the
Administrative Agent in good faith (Pro Forma EBITDA for such target as calculated and consented to
as of such closing being referred to as the “Initial Pro Forma EBITDA”). After the closing
of such Permitted Acquisition and unless otherwise agreed by the Administrative Agent and the
Borrower, Pro Forma EBITDA with respect thereto shall equal Initial Pro Forma EBITDA multiplied by
a fraction the numerator of which is three hundred sixty five (365) less the number of days after
the closing of the Permitted Acquisition included in any period for which financial statements have
been delivered and the denominator of which is three hundred sixty five (365).

          “Receivables” shall mean and include all of Borrower’s accounts, contract rights,
instruments (including promissory notes and other instruments evidencing Indebtedness owed to
Borrower by Affiliates), documents, chattel paper (whether tangible or electronic), general
intangibles relating to accounts, drafts and acceptances, and all other forms of obligations owing
to Borrower arising out of or in connection with the sale, lease or other disposition of Inventory
or the rendition of services and all guarantees and other security therefor, whether secured or
unsecured, now existing or hereafter created.

          “Receivables Advance Rate” shall have the meaning set forth in Section
2.01(a)(ii)(B)(i).

          “Register” has the meaning set forth in Section 9.04.

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          “Regulation U” means Regulation U of the Board of Governors of the Federal Reserve
System as from time to time in effect and any successor or other regulation or official
interpretation of said Board of Governors relating to the extension of credit by banks for the
purpose of purchasing or carrying margin stocks applicable to member banks of the Federal Reserve
System.

          “Related Parties” means, with respect to any specified Person, such Person’s
Affiliates and the respective directors, officers, trustees, employees, agents and advisors of such
Person and such Person’s Affiliates.

          “Required Lenders” means, at any time, Lenders having Revolving Credit Exposures, and
unused Commitments not otherwise described herein representing more than 50% of the sum of the
total Revolving Credit Exposures and unused Commitments at such time.

          “Reserves” shall mean such reserves against availability as Lender may reasonably deem
proper and necessary from time to time, including reserves for unpaid license fees and royalty
obligations owed by the Borrower.

          “Restricted Payment” means any dividend or other distribution (whether in cash,
securities or other property) with respect to any Equity Interests in the Borrower or any
Subsidiary, or any payment (whether in cash, securities or other property), including any sinking
fund or similar deposit, on account of the purchase, redemption, retirement, acquisition,
cancellation or termination of any such Equity Interests in the Borrower or any option, warrant or
other right to acquire any such Equity Interests in the Borrower.

          “Revolving Commitment” means, with respect to each Lender, the commitment of such
Lender to make Revolving Loans and to acquire participations in Letters of Credit hereunder,
expressed as an amount representing the maximum aggregate amount of such Lender’s Revolving Credit
Exposure hereunder, as such commitment may be (a) reduced from time to time pursuant to Section
2.08, and (b) reduced or increased from time to time pursuant to assignments by or to such Lender
pursuant to Section 9.04. The initial amount of each Lender’s Revolving Commitment is set forth on
Schedule 2.01, or in the Assignment and Assumption pursuant to which such Lender shall have
assumed its Revolving Commitment, as applicable.

          “Revolving Credit Exposure” means, with respect to any Lender at any time, the sum of
the outstanding principal amount of such Lender’s Revolving Loans and its LC Exposure at such time.

          “Revolving Credit Note” has the meaning set forth in Section 2.01(a).

          “Revolving Loan” means a Loan made pursuant to clause (a) of Section 2.01.

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

          “Sale and Leaseback Transaction” means any sale or other transfer of assets or
property by any Person with the intent to lease any such asset or property as lessee.

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          “subsidiary” means, with respect to any Person (the “parent”) at any date, any
corporation, limited liability company, partnership, association or other entity the accounts of
which would be consolidated with those of the parent in the parent’s consolidated financial
statements if such financial statements were prepared in accordance with GAAP as of such date, as
well as any other corporation, limited liability company, partnership, association or other entity
(a) of which securities or other ownership interests representing more than 50% of the equity or
more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the
general partnership interests are, as of such date, owned, controlled or held, or (b) that is, as
of such date, otherwise Controlled, by the parent or one or more subsidiaries of the parent or by
the parent and one or more subsidiaries of the parent.

          “Subsidiary” means any subsidiary of the Borrower.

          “Subsidiary Guarantor” means each Subsidiary of the Borrower (other than any Affected
Foreign Subsidiary). On the Effective Date there will be no Subsidiary Guarantors.

          “Swap Agreement” means any agreement with respect to any swap, forward, future or
derivative transaction or option or similar agreement involving, or settled by reference to, one or
more rates, currencies, commodities, equity or debt instruments or securities, or economic,
financial or pricing indices or measures of economic, financial or pricing risk or value or any
similar transaction or any combination of these transactions; provided that no phantom
stock or similar plan providing for payments only on account of services provided by current or
former directors, officers, employees or consultants of the Borrower or the Subsidiaries shall be a
Swap Agreement.

          “Taxes” means any and all present or future taxes, levies, imposts, duties,
deductions, charges or withholdings imposed by any Governmental Authority.

          “Term Loan” means a Loan made pursuant to Section 2.01(c).

          “Term Loan Commitment” means, with respect to each Lender, the commitment, if any, of
such Lender to make a Term Loan hereunder, expressed as an amount representing the maximum
principal amount of the Term Loan to be made by such Lender hereunder, as such commitment may be
(a) reduced from time to time pursuant to Section 2.08 and (b) reduced or increased from time to
time pursuant to assignments by or to such Lender pursuant to Section 9.04. The initial amount of
each Lender’s Term Loan Commitment is set forth on Schedule 2.01, or in the Assignment and
Assumption pursuant to which such Lender shall have assumed its Term Loan Commitment, as
applicable.

          “Total Consideration” means the total consideration and other amounts payable in
connection with any Acquisition, including any portion of the consideration payable in cash, any
consideration constituting the deferred purchase price for such Acquisition and all Indebtedness,
liabilities and contingent obligations incurred or assumed in connection with such Acquisition.

          “Transactions” means the execution, delivery and performance by the Borrower of this
Agreement and the other Loan Documents, the borrowing of Loans, the use of the proceeds thereof and
the issuance of Letters of Credit hereunder.

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          “Type”, when used in reference to any Loan or Borrowing, refers to whether the rate of
interest on such Loan, or on the Loans comprising such Borrowing, is determined by reference to the
LIBO Rate or the Alternate Base Rate.

          “Underlying Issuer” means Deutsche Bank AG, New York Branch or another bank reasonably
acceptable to the Borrower designated by the Issuing Bank to issue one or more Letters of Credit.

          “Unrestricted Liquid Assets” means, on any date, the aggregate amount of Borrower’s
and its Domestic Subsidiaries’ cash and Permitted Investments that are free from all Liens
(including Permitted Encumbrances other than those in favor of the Administrative Agent), setoff
(other than ordinary course setoff rights of a depository bank or securities intermediary arising
under a bank depository or securities intermediary agreement for customary fees, changes and other
account-related expenses due to such depository bank or securities intermediary thereunder),
counterclaim, recoupment, defense or other right in favor of any Person plus the amount of
undrawn availability under Section 2.01.

          “Withdrawal Liability” means liability to a Multiemployer Plan as a result of a
complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of
Subtitle E of Title IV of ERISA.

          SECTION 1.02. Classification of Loans and Borrowings. For purposes of this Agreement,
Loans may be classified and referred to by Class (e.g., a “Revolving Loan”) or by Type
(e.g., a “Eurodollar Loan”) or by Class and Type (e.g., a “Eurodollar Revolving
Loan”). Borrowings also may be classified and referred to by Class (e.g., a “Revolving
Borrowing”) or by Type (e.g., a “Eurodollar Borrowing”) or by Class and Type (e.g.,
a “Eurodollar Revolving Borrowing”).

          SECTION 1.03. Terms Generally. The definitions of terms herein shall apply equally to
the singular and plural forms of the terms defined. Whenever the context may require, any pronoun
shall include the corresponding masculine, feminine and neuter forms. The words “include”,
“includes” and “including” shall be deemed to be followed by the phrase “without limitation”. The
word “will” shall be construed to have the same meaning and effect as the word “shall”. Unless the
context requires otherwise (a) any definition of or reference to any agreement, instrument or other
document herein shall be construed as referring to such agreement, instrument or other document as
from time to time amended, supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference herein to any Person
shall be construed to include such Person’s successors and assigns, (c) the words “herein”,
“hereof” and “hereunder”, and words of similar import, shall be construed to refer to this
Agreement in its entirety and not to any particular provision hereof, (d) all references herein to
Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of,
and Exhibits and Schedules to, this Agreement and (e) the words “asset” and “property” shall be
construed to have the same meaning and effect and to refer to any and all tangible and intangible
assets and properties, including cash, securities, accounts and contract rights.

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          SECTION 1.04. Accounting Terms; GAAP. Except as otherwise expressly provided herein,
all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in
effect from time to time; provided that, if the Borrower notifies the Administrative Agent that the
Borrower requests an amendment to any provision hereof to eliminate the effect of any change
occurring after the date hereof in GAAP or in the application thereof on the operation of such
provision (or if the Administrative Agent notifies the Borrower that the Required Lenders request
an amendment to any provision hereof for such purpose), regardless of whether any such notice is
given before or after such change in GAAP or in the application thereof, then such provision shall
be interpreted on the basis of GAAP as in effect and applied immediately before such change shall
have become effective until such notice shall have been withdrawn or such provision amended in
accordance herewith.

ARTICLE II

The Credits

          SECTION 2.01. Commitments.

          (a) Subject to the terms and conditions set forth herein, each Lender agrees to make Revolving
Loans to the Borrower from time to time during the Availability Period in an aggregate principal
amount that will not result in (i) such Lender’s Revolving Credit Exposure exceeding such Lender’s
Revolving Commitment, or (ii) the aggregate amount of the Lenders’ Revolving Credit Exposures
exceeding the lesser of (A) the Aggregate Revolving Commitment or (B) an amount equal to:

     (i) up to 80% (the “Receivables Advance Rate”) of Eligible Receivables,
minus

     (ii) the aggregate amount of outstanding Letters of Credit, minus

     (iii) Reserves.

The amount derived from Section 2.1(a)(ii)(B)(i) minus Section 2.1(a)(ii)(B)(iii) at any
time and from time to time shall be referred to as the “Formula Amount”. The Revolving
Loans shall be evidenced by a note (“Revolving Credit Note”) substantially in the form
attached hereto as Exhibit C. Within the foregoing limits and subject to the terms and
conditions set forth herein, the Borrower may borrow, repay and reborrow Revolving Loans.

          (b) Discretionary Rights. The Receivables Advance Rate may be (i) decreased by Lender
at any time and from time to time, and (ii) increased by Lender at any time and from time to time
after the Receivables Advance Rate has been decreased, but in no event to levels higher than the
initial Receivables Advance Rate, in each case in the exercise of Lender’s sole discretion.
Borrower consents to any such decreases and acknowledges that decreasing the Receivables Advance
Rate or increasing the Reserves may limit or restrict Advances requested by Borrower. Lender shall
give Borrower five (5) days prior written notice of its intention to decrease the Receivables
Advance Rate.

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          (c) Subject to additional business and legal due diligence on the Borrower, including, but not
limited to, valuation of the intellectual property owned and/or used by the Borrower, with results
satisfactory to the Administrative Agent in its sole discretion, the Administrative Agent and the
Lenders may enter into an amendment to this Credit Agreement pursuant to which the Lenders may make
Term Loans in an aggregate amount up to $20,000,000 (the “Term Loans”), which Term Loans
shall be available in not more than three (3) separate draws beginning on the effective date of the
amendment to this Credit Agreement providing for such Term Loans and ending on the first
anniversary of the Effective Date. The Administrative Agent retains the right in its sole
discretion to provide the Term Loans in two or more separate tranches.

          SECTION 2.02. Loans and Borrowings.

          (a) Each Revolving Loan shall be made as part of a Borrowing consisting of Revolving Loans
made by the Lenders ratably in accordance with their respective Revolving Commitments. The failure
of any Lender to make any Loan required to be made by it shall not relieve any other Lender of its
obligations hereunder; provided that the Commitments of the Lenders are several, and no
Lender shall be responsible for any other Lender’s failure to make Loans as required hereunder.

          (b) Subject to Section 2.14, each Revolving Borrowing shall be comprised entirely of ABR Loans
or Eurodollar Loans as the Borrower may request in accordance herewith. Each Lender at its option
may make any Eurodollar Loan by causing any domestic or foreign branch or Affiliate of such Lender
to make such Loan; provided that any exercise of such option shall not affect the
obligation of the Borrower to repay such Loan in accordance with the terms of this Agreement.

          (c) At the commencement of each Interest Period for any Eurodollar Borrowing, such Borrowing
shall be in an aggregate amount that is an integral multiple of $500,000 and not less than
$500,000. At the time that each ABR Borrowing is made, such Borrowing shall be in an aggregate
amount that is an integral multiple of $500,000 and not less than $500,000; provided that
an ABR Revolving Borrowing may be made in an aggregate amount that is equal to the entire unused
balance of the total Revolving Commitments or that is required to finance the reimbursement of an
LC Disbursement as contemplated by Section 2.05(e). Borrowings of more than one Type and Class may
be outstanding at the same time; provided that there shall not at any time be more than a
total of five (5) Eurodollar Revolving Borrowings outstanding.

          (d) Notwithstanding any other provision of this Agreement, the Borrower shall not be entitled
to request, or to elect to convert or continue, any Borrowing if the Interest Period requested with
respect thereto would end after the Maturity Date.

          SECTION 2.03. Requests for Revolving Borrowings. To request a Revolving Borrowing,
the Borrower shall notify the Administrative Agent of such request by telephone (a) in the case of
a Eurodollar Borrowing, not later than 11:00 a.m., New York City time, three (3) Business Days
before the date of the proposed Borrowing or (b) in the case of an ABR Borrowing, not later than
11:00 a.m., New York City time, one (1) Business Day before the

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date of the proposed Borrowing; provided that any such notice of an ABR Revolving
Borrowing to finance the reimbursement of an LC Disbursement as contemplated by Section 2.05(e) may
be given not later than 10:00 a.m., New York City time, on the date of the proposed Borrowing.
Each such telephonic Borrowing Request shall be irrevocable and shall be confirmed promptly by hand
delivery or facsimile to the Administrative Agent of a written Borrowing Request in a form approved
by the Administrative Agent and signed by the Borrower. Each such telephonic and written Borrowing
Request shall specify the following information in compliance with Section 2.02:

     (i) the aggregate amount of the requested Borrowing;

     (ii) the date of such Borrowing, which shall be a Business Day;

     (iii) whether such Borrowing is to be an ABR Borrowing or a Eurodollar
Borrowing;

     (iv) in the case of a Eurodollar Borrowing, the initial Interest Period to be
applicable thereto, which shall be a period contemplated by the definition of the
term “Interest Period”; and

     (v) the location and number of the Borrower’s account to which funds are to be
disbursed, which shall comply with the requirements of Section 2.06.

If no election as to the Type of Borrowing is specified, then the requested Borrowing shall be an
ABR Borrowing. If no Interest Period is specified with respect to any requested Eurodollar
Borrowing, then the Borrower shall be deemed to have selected an Interest Period of one month’s
duration. Promptly following receipt of a Borrowing Request in accordance with this Section, the
Administrative Agent shall advise each Lender of the details thereof and of the amount of such
Lender’s Loan to be made as part of the requested Borrowing.

          SECTION 2.04. [Intentionally omitted].

          SECTION 2.05. Letters of Credit.

          (a) General. Subject to the terms and conditions set forth herein, the Borrower may
request the issuance of Letters of Credit for its own account, in a form reasonably acceptable to
the Administrative Agent and the Issuing Lender, at any time and from time to time during the
Availability Period. In the event of any inconsistency between the terms and conditions of this
Agreement and the terms and conditions of any form of letter of credit application or other
agreement submitted by the Borrower to, or entered into by the Borrower with, the Issuing Lender
relating to any Letter of Credit, the terms and conditions of this Agreement shall control.

          (b) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions. To request
the issuance of a Letter of Credit (or the amendment, renewal or extension of an outstanding Letter
of Credit), the Borrower shall hand deliver or facsimile (or transmit by electronic communication,
if arrangements for doing so have been approved by the Issuing Lender) to the Issuing Lender and
the Administrative Agent (reasonably in advance of the

23

 

requested date of issuance, amendment, renewal or extension), but in any event at least three
Business Days in advance of the requested action, a notice requesting the issuance of a Letter of
Credit, or identifying the Letter of Credit to be amended, renewed or extended, and specifying the
date of issuance, amendment, renewal or extension (which shall be a Business Day), the date on
which such Letter of Credit is to expire (which shall comply with paragraph (c) of this Section),
the amount of such Letter of Credit, the name and address of the beneficiary thereof, and such
other information as shall be necessary to prepare, amend, renew or extend such Letter of Credit.
If requested by the Issuing Lender, the Borrower also shall submit a letter of credit application
on the Issuing Lender’s standard form in connection with any request for a Letter of Credit. A
Letter of Credit shall be issued, amended, renewed or extended only if (and upon issuance,
amendment, renewal or extension of each Letter of Credit the Borrower shall be deemed to represent
and warrant that), after giving effect to such issuance, amendment, renewal or extension (i) the LC
Exposure shall not exceed $10,000,000 and (ii) the total Revolving Credit Exposures shall not
exceed the Aggregate Revolving Commitment.

          (c) Expiration Date. Each Letter of Credit shall expire at or prior to the close of
business on the earlier of (i) the date one year after the date of the issuance of such Letter of
Credit (or, in the case of any renewal or extension thereof, one year after such renewal or
extension) and (ii) the date that is five (5) Business Days prior to the Maturity Date. Any Letter
of Credit may provide by its terms that it may be extended for additional successive one-year
periods on terms reasonably acceptable to the Issuing Lender. Any Letter of Credit providing for
automatic extension shall be extended upon the then current expiration date without any further
action by any Person unless the Issuing Lender shall have given notice to the applicable
beneficiary (with a copy to the Borrower) of the election by the Issuing Lender not to extend such
Letter of Credit, such notice to be given not fewer than forty five (45) days prior to the then
current expiration date of such Letter of Credit, provided that no Letter of Credit may be
extended automatically or otherwise beyond the date that is five (5) Business Days prior to the
Maturity Date.

          (d) Participations. By the issuance of a Letter of Credit (or an amendment to a
Letter of Credit increasing the amount thereof) and without any further action on the part of the
Issuing Lender or the Lenders, the Issuing Lender hereby grants to each Lender, and each Lender
hereby acquires from the Issuing Lender, a participation in such Letter of Credit equal to such
Lender’s Applicable Percentage of the aggregate amount available to be drawn under such Letter of
Credit. In consideration and in furtherance of the foregoing, each Lender hereby absolutely and
unconditionally agrees to pay to the Administrative Agent, for the account of the Issuing Lender,
such Lender’s Applicable Percentage of each LC Disbursement made by the Issuing Lender and not
reimbursed by the Borrower on the date due as provided in paragraph (e) of this Section, or of any
reimbursement payment required to be refunded to the Borrower for any reason. Each Lender
acknowledges and agrees that its obligation to acquire participations pursuant to this paragraph in
respect of Letters of Credit is absolute and unconditional and shall not be affected by any
circumstance whatsoever, including any amendment, renewal or extension of any Letter of Credit or
the occurrence and continuance of a Default or reduction or termination of the Commitments, and
that each such payment shall be made without any offset, abatement, withholding or reduction
whatsoever.

24

 

          (e) Reimbursement. If the Issuing Lender shall make any LC Disbursement in respect of
a Letter of Credit, the Borrower shall reimburse such LC Disbursement by paying to the
Administrative Agent an amount equal to such LC Disbursement not later than 10:00 a.m., New York
City time, on the date that such LC Disbursement is made, if the Borrower shall have received
notice of such LC Disbursement prior to 10:00 a.m., New York City time, on such date, or, if such
notice has not been received by the Borrower prior to such time on such date, then not later than
12:00 noon, New York City time, on (i) the Business Day that the Borrower receives such notice, if
such notice is received prior to 10:00 a.m., New York City time, on the day of receipt, or (ii) the
Business Day immediately following the day that the Borrower receives such notice, if such notice
is not received prior to such time on the day of receipt; provided that the Borrower may,
subject to the conditions to borrowing set forth herein, request in accordance with Section 2.03 or
2.04 that such payment be financed with an ABR Revolving Borrowing in an equivalent amount and, to
the extent so financed, the Borrower’s obligation to make such payment shall be discharged and
replaced by the resulting ABR Revolving Borrowing. If the Borrower fails to make such payment when
due, the Administrative Agent shall notify each Lender of the applicable LC Disbursement, the
payment then due from the Borrower in respect thereof and such Lender’s Applicable Percentage
thereof. Promptly following receipt of such notice, each Lender shall pay to the Administrative
Agent its Applicable Percentage of the payment then due from the Borrower, in the same manner as
provided in Section 2.06 with respect to Loans made by such Lender (and Section 2.06 shall apply,
mutatis mutandis, to the payment obligations of the Lenders). Promptly following
receipt by the Administrative Agent of any payment from the Borrower pursuant to this paragraph,
the Administrative Agent shall distribute such payment to the Issuing Lender or, to the extent that
Lenders have made payments pursuant to this paragraph to reimburse the Issuing Lender, then to such
Lenders and the Issuing Lender as their interests may appear. Any payment made by a Lender
pursuant to this paragraph to reimburse the Issuing Lender for any LC Disbursement (other than the
funding of ABR Revolving Loans as contemplated above) shall not constitute a Loan and shall not
relieve the Borrower of its obligation to reimburse such LC Disbursement.

          (f) Obligations Absolute. The Borrower’s obligation to reimburse LC Disbursements as
provided in paragraph (e) of this Section shall be absolute, unconditional and irrevocable, and
shall be performed strictly in accordance with the terms of this Agreement under any and all
circumstances whatsoever and irrespective of

     (i) any lack of validity or enforceability of any Letter of Credit or this
Agreement, or any term or provision therein,

     (ii) any draft or other document presented under a Letter of Credit proving to
be forged, fraudulent or invalid in any respect or any statement therein being
untrue or inaccurate in any respect,

     (iii) payment by the Issuing Lender under a Letter of Credit against
presentation of a draft or other document that does not strictly comply with the
terms of such Letter of Credit, or

     (iv) any other event or circumstance whatsoever, whether or not similar to any
of the foregoing, that might, but for the provisions of this Section,

25

 

constitute a legal or equitable discharge of, or provide a right of setoff
against, the Borrower’s obligations hereunder. Neither the Administrative Agent,
the Lenders nor the Issuing Lender, nor any of their Related Parties, shall have any
liability or responsibility by reason of or in connection with the issuance or
transfer of any Letter of Credit or any payment or failure to make any payment
thereunder (irrespective of any of the circumstances referred to in the preceding
sentence), or any error, omission, interruption, loss or delay in transmission or
delivery of any draft, notice or other communication under or relating to any Letter
of Credit (including any document required to make a drawing thereunder), any error
in interpretation of technical terms or any consequence arising from causes beyond
the control of the Issuing Lender. The parties hereto expressly agree that, in the
absence of gross negligence or willful misconduct on the part of the Issuing Lender
(as finally determined by a court of competent jurisdiction), the Issuing Lender
shall be deemed to have exercised care in each such determination. In furtherance
of the foregoing and without limiting the generality thereof, the parties agree
that, with respect to documents presented which appear on their face to be in
substantial compliance with the terms of a Letter of Credit, the Issuing Lender may,
in its sole discretion and in the absence of any injunction or other legal
restriction on its so doing, either accept and make payment upon such documents
without responsibility for further investigation, regardless of any notice or
information to the contrary, or refuse to accept and make payment upon such
documents if such documents are not in strict compliance with the terms of such
Letter of Credit.

          (g) Disbursement Procedures. The Issuing Lender shall, promptly following its receipt
thereof, examine all documents purporting to represent a demand for payment under a Letter of
Credit. The Issuing Lender shall promptly notify the Administrative Agent and the Borrower by
telephone (confirmed by facsimile) of such demand for payment and whether the Issuing Lender has
made or will make an LC Disbursement thereunder; provided that any failure to give or delay
in giving such notice shall not relieve the Borrower of its obligation to reimburse the Issuing
Lender and the Lenders with respect to any such LC Disbursement.

          (h) Interim Interest. If the Issuing Lender shall make any LC Disbursement, then,
unless the Borrower shall reimburse such LC Disbursement in full on the date such LC Disbursement
is made, the unpaid amount thereof shall bear interest, for each day from and including the date
such LC Disbursement is made to but excluding the date that the Borrower reimburses such LC
Disbursement, at the rate per annum then applicable to ABR Revolving Loans; provided that,
if the Borrower fails to reimburse such LC Disbursement when due pursuant to paragraph (e) of this
Section, then Section 2.13(c) shall apply. Interest accrued pursuant to this paragraph shall be
for the account of the Issuing Lender, except that interest accrued on and after the date of
payment by any Lender pursuant to paragraph (e) of this Section to reimburse the Issuing Lender
shall be for the account of such Lender to the extent of such payment.

          (i) Replacement of the Issuing Lender. The Issuing Lender may be replaced at any time
by written agreement among the Borrower, the Administrative Agent, the replaced Issuing Lender and
the successor Issuing Lender. The Administrative Agent shall notify the

26

 

Lenders of any such replacement of the Issuing Lender. At the time any such replacement
shall become effective, the Borrower shall pay all unpaid fees accrued for the account of the
replaced Issuing Lender pursuant to Section 2.12(b). From and after the effective date of any such
replacement, (i) the successor Issuing Lender shall have all the rights and obligations of the
Issuing Lender under this Agreement with respect to Letters of Credit to be issued by it thereafter
and (ii) references herein to the term “Issuing Lender” shall be deemed to refer to such successor
or to any previous Issuing Lender, or to such successor and all previous Issuing Lenders, as the
context shall require. After the replacement of an Issuing Lender hereunder, the replaced Issuing
Lender shall remain a party hereto and shall continue to have all the rights and obligations of an
Issuing Lender under this Agreement with respect to Letters of Credit issued by it prior to such
replacement, but shall not be required to issue additional Letters of Credit.

          (j) Cash Collateralization. If any Event of Default shall occur and be continuing, on
the Business Day that the Borrower receives notice from the Administrative Agent or the Required
Lenders (or, if the maturity of the Loans has been accelerated, Lenders with LC Exposure
representing greater than 50% of the total LC Exposure) demanding the deposit of cash collateral
pursuant to this paragraph, the Borrower shall deposit in an interest – bearing account with the
Administrative Agent, in the name of the Administrative Agent and for the benefit of the Lenders,
an amount in cash equal to 105% of the LC Exposure as of such date plus any accrued and unpaid
interest thereon; provided that the obligation to deposit such cash collateral shall become
effective immediately, and such deposit shall become immediately due and payable, without demand or
other notice of any kind, upon the occurrence of any Event of Default with respect to the Borrower
described in clause (h) or (i) of Article VII. Such deposit shall be held by the Administrative
Agent as collateral for the payment and performance of the obligations of the Borrower under this
Agreement. The Administrative Agent shall have exclusive dominion and control, including the
exclusive right of withdrawal, over such account. Interest or profits, if any, shall accumulate in
such account. Moneys in such account shall be applied by the Administrative Agent to reimburse the
Issuing Lender for LC Disbursements for which it has not been reimbursed and, to the extent not so
applied, shall be held for the satisfaction of the reimbursement obligations of the Borrower for
the LC Exposure at such time or, if the maturity of the Loans has been accelerated (but subject to
the consent of Lenders with LC Exposure representing greater than 50% of the total LC Exposure), be
applied to satisfy other obligations of the Borrower under this Agreement. If the Borrower is
required to provide an amount of cash collateral hereunder as a result of the occurrence of an
Event of Default, such amount (to the extent not applied as aforesaid) and the accrued interest and
profits thereon shall be returned to the Borrower within three Business Days after all Events of
Default have been cured or waived.

          SECTION 2.06. Funding of Borrowings.

          (a) Each Lender shall make each Loan to be made by it hereunder on the proposed date thereof
by wire transfer of immediately available funds by 12:00 noon, New York City time, to the account
of the Administrative Agent most recently designated by it for such purpose by notice to the
Lenders. The Administrative Agent will make such Loans available to the Borrower by crediting by
3:00 p.m., New York City time, the amounts so received, in like funds, to an account of the
Borrower maintained with the Administrative Agent in New York City and designated by the Borrower
in the applicable Borrowing Request; provided that ABR

27

 

Revolving Loans made to finance the
reimbursement of an LC Disbursement as provided in Section 2.05(e) shall be remitted by the
Administrative Agent to the Issuing Lender.

          (b) Unless the Administrative Agent shall have received notice from a Lender prior to the
proposed date of any Borrowing that such Lender will not make available to the Administrative Agent
such Lender’s share of such Borrowing, the Administrative Agent may assume that such Lender has
made such share available on such date in accordance with paragraph (a) of this Section and may, in
reliance upon such assumption, make available to the Borrower a corresponding amount. In such
event, if a Lender has not in fact made its share of the applicable Borrowing available to the
Administrative Agent, then the applicable Lender and the Borrower severally agree to pay to the
Administrative Agent forthwith on demand such corresponding amount with interest thereon, for each
day from and including the date such amount is made available to the Borrower to but excluding the
date of payment to the Administrative Agent, at (i) in the case of such Lender, the greater of the
Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with
banking industry rules on interbank compensation or (ii) in the case of the Borrower, the interest
rate applicable to ABR Loans. If such Lender pays such amount to the Administrative Agent, then
such amount shall constitute such Lender’s Loan included in such Borrowing.

          SECTION 2.07. Interest Elections.

          (a) Each Revolving Borrowing initially shall be of the Type specified in the applicable
Borrowing Request and, in the case of a Eurodollar Borrowing, shall have an initial Interest Period
as specified in such Borrowing Request. Thereafter, the Borrower may elect to convert such
Borrowing to a different Type or to continue such Borrowing and, in the case of a Eurodollar
Borrowing, may elect Interest Periods therefor, all as provided in this Section. The Borrower may
elect different options with respect to different portions of the affected Borrowing, in which case
each such portion shall be allocated ratably among the Lenders holding the Loans comprising such
Borrowing, and the Loans comprising each such portion shall be considered a separate Revolving
Borrowing.

          (b) To make an election pursuant to this Section, the Borrower shall notify the Administrative
Agent of such election by telephone by the time that a Borrowing Request would be required under
Section 2.03 if the Borrower were requesting a Revolving Borrowing of the Type resulting from such
election to be made on the effective date of such election. Each such telephonic Interest Election
Request shall be irrevocable and shall be confirmed promptly by hand delivery or facsimile to the
Administrative Agent of a written Interest Election Request in a form approved by the
Administrative Agent and signed by the Borrower.

          (c) Each telephonic and written Interest Election Request shall specify the following
information in compliance with Section 2.02:

     (i) the Borrowing to which such Interest Election Request applies and, if
different options are being elected with respect to different portions thereof, the
portions thereof to be allocated to each resulting Borrowing (in which case the
information to be specified pursuant to clauses (iii) and (iv) below shall be
specified for each resulting Borrowing);

28

 

     (ii) the effective date of the election made pursuant to such Interest Election
Request, which shall be a Business Day;

     (iii) whether the resulting Borrowing is to be an ABR Borrowing or a Eurodollar
Borrowing; and

     (iv) if the resulting Borrowing is a Eurodollar Borrowing, the Interest Period
to be applicable thereto after giving effect to such election, which shall be a
period contemplated by the definition of the term “Interest Period”.

If any such Interest Election Request requests a Eurodollar Borrowing but does not specify an
Interest Period, then the Borrower shall be deemed to have selected an Interest Period of one
month’s duration.

          (d) Promptly following receipt of an Interest Election Request, the Administrative Agent shall
advise each Lender of the details thereof and of such Lender’s portion of each resulting Borrowing.

          (e) If the Borrower fails to deliver a timely Interest Election Request with respect to a
Eurodollar Borrowing prior to the end of the Interest Period applicable thereto, then, unless such
Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing shall be
converted to an ABR Borrowing. Notwithstanding any contrary provision hereof, if an Event of
Default has occurred and is continuing and the Administrative Agent, at the request of the Required
Lenders, so notifies the Borrower, then, so long as an Event of Default is continuing (i) no
outstanding Borrowing may be converted to or continued as a Eurodollar Borrowing and (ii) unless
repaid, each Eurodollar Borrowing shall be converted to an ABR Borrowing at the end of the Interest
Period applicable thereto.

          SECTION 2.08. Termination and Reduction of Commitments.

          (a) Unless previously terminated, the Revolving Commitments shall terminate on the Maturity
Date.

          (b) The Borrower may at any time terminate, or from time to time reduce, the Commitments;
provided that (i) each reduction of the Commitments shall be in an amount that is not less
than $1,000,000 and in integral multiples of $500,000 in excess thereof, (ii) the Borrower shall
not terminate or reduce the Revolving Commitments if, after giving effect to any concurrent
prepayment of the Loans in accordance with Section 2.11, the Revolving Credit Exposures would
exceed the Aggregate Revolving Commitment and (iii) if at any time before any Term Loans are made,
the Borrower satisfies the prepayment requirements set forth in this Section 2.08(b) by remitting a
prepayment fee to the Administrative Agent for the ratable benefit of the Lenders with Revolving
Commitments in an amount equal to 20% of the aggregate amount by which the Aggregate Revolving
Commitment is reduced.

          (c) The Borrower shall notify the Administrative Agent of any election to terminate or reduce
the Commitments of any Class under paragraph (b) of this Section at least one Business Days prior
to the effective date of such termination or reduction, specifying such election and the effective
date thereof. Promptly following receipt of any notice, the

29

 

Administrative Agent shall advise the
Lenders of the contents thereof. Each notice delivered by the Borrower pursuant to this Section
shall be irrevocable; provided that a notice of termination of the Commitments delivered by
the Borrower may state that such notice is conditioned upon the effectiveness of other credit
facilities, in which case such notice may be revoked by the Borrower (by notice to the
Administrative Agent on or prior to the specified effective date) if such condition is not
satisfied. Any termination or reduction of the Commitments of any Class shall be permanent. Each
reduction of the Commitments of any Class shall be made ratably among the Lenders in accordance
with their respective Commitments with respect to such Class.

          SECTION 2.09. Repayment of Loans; Evidence of Debt.

          (a) The Borrower hereby unconditionally promises to pay to the Administrative Agent for the
account of each Lender the then unpaid principal amount of each Revolving Loan on the Maturity
Date.

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

          (c) The Administrative Agent shall maintain accounts in which it shall record (i) the amount
of each Loan made hereunder, the Class and Type thereof and the Interest Period applicable thereto,
(ii) the amount of any principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder and (iii) the amount of any sum received by the Administrative
Agent hereunder for the account of the Lenders and each Lender’s share thereof.

          (d) The entries made in the accounts maintained pursuant to paragraph (b) or (c) of this
Section shall be prima facie evidence of the existence and amounts of the
obligations recorded therein; provided that the failure of any Lender or the Administrative
Agent to maintain such accounts or any error therein shall not in any manner affect the obligation
of the Borrower to repay the Loans in accordance with the terms of this Agreement.

          (e) Any Lender may request that Loans of any Class made by it be evidenced by a promissory
note. In such event, the Borrower shall prepare, execute and deliver to such Lender a promissory
note payable to the order of such Lender (or, if requested by such Lender, to such Lender and its
registered assigns) and in a form approved by the Administrative Agent. Thereafter, the Loans
evidenced by such promissory note and interest thereon shall at all times (including after
assignment pursuant to Section 9.04) be represented by one or more promissory notes in such form
payable to the order of the payee named therein (or, if such promissory note is a registered note,
to such payee and its registered assigns).

          SECTION 2.10. [Intentionally omitted]

          SECTION 2.11. Prepayment of Loans. (a) The Borrower shall have the right at any time
and from time to time to prepay any Borrowing in whole or in part, provided that the Borrower pays
the funding compensation required by Section 2.16 and such prepayment is in a minimum amount equal
to $1,000,000 or any integral multiple of $500,000 in excess thereof in the case of any ABR
Borrowing, and $1,000,000 or any integral multiple of $500,000 in excess thereof in the case of any
Eurodollar Borrowing.

30

 

          (b) In the event and on such occasion the total Revolving Credit Exposures exceed the lesser
of the Aggregate Revolving Commitment or the Formula Amount, the Borrower shall prepay Revolving
Borrowings (or, if no such Borrowings are outstanding, deposit cash collateral in an account with
the Administrative Agent pursuant to Section 2.05(j)) in an aggregate amount equal to such excess.

          (c) In the event and on such occasion the Borrower or any Subsidiary receives Net Proceeds
from the issuance or sale by the Borrower or any Subsidiary of any Equity Interests, in each case
within three (3) Business Days after the Borrower’s or any Subsidiaries’ receipt of such Net
Proceeds, the Borrower shall make a mandatory prepayment of the Loans in an aggregate amount equal
to 100% of such Net Proceeds; provided, however, that, so long as no Event of Default has occurred
and is continuing, no such repayment shall be applied without Borrower’s consent to any Eurodollar
Rate Loan until the last day of the Interest Period therefor.

          (d) In the event and on such occasion the Borrower or any Subsidiary receives Net Proceeds
from the incurrence by the Borrower or any Subsidiary of any Indebtedness pursuant to Section
6.01(h) or any other Indebtedness not permitted pursuant to Section 6.01, in each case within three
(3) Business Days after the Borrower’s or any Subsidiaries’ receipt of such Net Proceeds, the
Borrower shall make a mandatory prepayment of the Loans in an aggregate amount equal to 100% of
such Net Proceeds; provided, however, that, so long as no Event of Default has occurred and is
continuing, no such repayment shall be applied without Borrower’s consent to any Eurodollar Rate
Loan until the last day of the Interest Period therefor.

          (e) In the event and on such occasion the Borrower or any Subsidiary receives any Net Proceeds
from the sale, transfer, lease or other disposition (including pursuant to a sale and leaseback
transaction) of any property or asset of any Borrower or any Subsidiary, other than (i)
dispositions described in clauses (a), (b) and (c) of Section 6.10 and (ii) other dispositions
resulting in aggregate Net Proceeds not exceeding (A) $100,000 in the case of any single
transaction or series of related transactions or (B) $250,000 for all such dispositions during any
fiscal year of the Borrower, in each case within three (3) Business Days after the Borrower’s or
any Subsidiary’s receipt of such Net Proceeds, the Borrower shall make a mandatory prepayment of
the Loans in an aggregate amount equal to 100% of such Net Proceeds; provided, however, that, so
long as no Event of Default has occurred and is continuing, no such repayment shall be applied
without Borrower’s consent to any Eurodollar Rate Loan until the last day of the Interest Period
therefor.

          (f) In the event and on such occasion the Borrower or any Subsidiary receives any Net Proceeds
from any casualty or other insured damage to, or any taking under power of eminent domain or by
casualty or other insured damage to, or any taking under power of eminent domain or by condemnation
or similar proceeding of, any property or asset of the Borrower or any Subsidiary, within three (3)
Business Days after the Borrower’s or any Subsidiaries’ receipt of such Net Proceeds, the Borrower
shall, except as otherwise permitted below, make a mandatory prepayment of the Loans in an
aggregate amount equal to 100% of such Net Proceeds, but only to the extent that (i) the Net
Proceeds therefrom have not been applied to

31

 

repair, restore or replace such property or asset or to
acquire real property, equipment or other tangible assets to be used in the business of the
Borrower and the Subsidiaries within 90 days after receipt of such Net Proceeds or (ii) a written
contract or agreement has not been entered into during such 90-day period to so apply such Net
Proceeds during the period ending 180 days after such receipt; provided, however, that, so long as
no Event of Default has occurred and is continuing, no such repayment shall be applied without
Borrower’s consent to any Eurodollar Rate Loan until the last day of the Interest Period therefor.

          (g) Prior to any optional or mandatory prepayment of Borrowings hereunder, the applicable
Borrower shall select the Borrowing or Borrowings to be prepaid and shall specify such selection in
the notice of such prepayment.

          SECTION 2.12. Fees.

          (a) The Borrower agrees to pay to the Administrative Agent for the account of each Lender a
commitment fee, which shall accrue at a per annum rate of 0.75% on the average daily unused amount
of the Revolving Commitment of such Lender during the period from and including the Effective Date
to but excluding the date on which such Revolving Commitment terminates; provided that, if
such Lender continues to have any Revolving Credit Exposure after its Revolving Commitment
terminates, then such commitment fee shall continue to accrue on the daily amount of such Lender’s
Revolving Credit Exposure from and including the date on which its Revolving Commitment terminates
to but excluding the date on which such Lender ceases to have any Revolving Credit Exposure.
Accrued commitment fees shall be payable in arrears on the last day of each calendar month and on
the date on which the Revolving Commitments terminate, commencing on the first such date to occur
after the date hereof; provided that any commitment fees accruing after the date on which
the Commitments terminate shall be payable on demand. All commitment fees and amounts payable in
respect of Deposits shall be computed on the basis of a year of 365 (or 366 days in a leap year)
days and shall be payable for the actual number of days elapsed (including the first day but
excluding the last day).

          (b) The Borrower agrees to pay (i) to the Administrative Agent for the account of each Lender
with a Revolving Commitment a participation fee with respect to its participations in Letters of
Credit, which shall accrue at the same Applicable Rate used to determine the interest rate
applicable to Eurodollar Revolving Loans on the average daily amount of such Lender’s LC Exposure
(excluding any portion thereof attributable to unreimbursed LC Disbursements) during the period
from and including the Effective Date to but excluding the later of the date on which such Lender’s
Revolving Commitment terminates and the date on which such Lender ceases to have any LC Exposure,
and (ii) to the Issuing Lender a fronting fee, which shall accrue at the rate of 0.125% per annum
on the average daily amount of the LC Exposure during the period from and including the Effective
Date to but excluding the later of the date of termination of the Revolving Commitments and the
date on which there ceases to be any LC Exposure, as well as the Issuing Lender’s standard fees
with respect to the issuance, amendment, renewal or extension of any Letter of Credit or processing
of drawings thereunder. Participation fees and fronting fees accrued through and including the
last day of each calendar month; provided that all such fees shall be payable on the date on which
the Commitments terminate and any such fees accruing after the date on which the Commitments
terminate shall be payable on demand. Any other fees payable to the Issuing Lender pursuant to

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this paragraph shall be payable within 10 days after demand. All participation fees and fronting
fees shall be computed on the basis of a year of 365 (or 366 days in a leap year) days and shall be
payable for the actual number of days elapsed (including the first day but excluding the last day).

          (c) The Borrower agrees to pay to the Administrative Agent, for its own account, fees payable
in the amounts and at the times separately agreed upon between the Borrower and the Administrative
Agent.

          (d) All fees payable hereunder or under any other Loan Document shall be paid on the dates
due, in immediately available funds, to the Administrative Agent (or to the Issuing Lender, in the
case of fees payable to it) for distribution, in the case of commitment fees and participation
fees, to the Lenders. Fees paid shall not be refundable under any circumstances.

          SECTION 2.13. Interest.

          (a) The Loans comprising each ABR Borrowing shall bear interest at the Alternate Base Rate
plus the Applicable Rate.

          (b) The Loans comprising each Eurodollar Borrowing shall bear interest at the LIBO Rate for
the Interest Period in effect for such Borrowing plus the Applicable Rate.

          (c) Notwithstanding the foregoing, if (i) an Event of Default described in clause (h) or (i)
of Article VII has occurred and is continuing or (ii) any principal of or interest on any Loan or
any fee or other amount payable by the Borrower hereunder is not paid when due, whether at stated
maturity, upon acceleration or otherwise, such overdue amount shall bear interest, after as well as
before judgment, at a rate per annum equal to (i) in the case of overdue principal of any Loan, 2%
plus the rate otherwise applicable to such Loan as provided in the preceding paragraphs of
this Section, or (ii) in the case of any other amount, 2% plus the rate applicable to ABR
Loans as provided in paragraph (a) of this Section.

          (d) Accrued interest on each Loan shall be payable in arrears on each Interest Payment Date
for such Loan and, in the case of Revolving Loans, upon termination of the Revolving Commitments;
provided that (i) interest accrued pursuant to paragraph (c) of this Section shall be
payable on demand, (ii) in the event of any repayment or prepayment of any Loan (other than a
prepayment of an ABR Revolving Loan prior to the end of the Availability Period), accrued interest
on the principal amount repaid or prepaid shall be payable on the date of such repayment or
prepayment and (iii) in the event of any conversion of any Eurodollar Revolving Loan prior to the
end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the
effective date of such conversion.

          (e) All interest hereunder shall be computed on the basis of a year of 360 days, except that
interest computed by reference to the Alternate Base Rate at times when the Alternate Base Rate is
based on the Prime Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap
year), and in each case shall be payable for the actual number of days elapsed (including the first
day but excluding the last day). The applicable Alternate Base Rate, LIBO Rate or LIBO Rate shall
be determined by the Administrative Agent, and such determination shall be conclusive absent
manifest error.

33

 

          SECTION 2.14. Alternate Rate of Interest. If prior to the commencement of any
Interest Period for a Eurodollar Borrowing:

          (a) the Administrative Agent determines (which determination shall be conclusive absent
manifest error) that adequate and reasonable means do not exist for ascertaining the LIBO Rate or
the LIBO Rate, as applicable, for such Interest Period;

          (b) the Administrative Agent is advised by the Required Lenders that the LIBO Rate or the LIBO
Rate, as applicable, for such Interest Period will not adequately and fairly reflect the cost to
such Lenders (or Lender) of making or maintaining their Loans (or its Loan) included in such
Borrowing for such Interest Period; or

          (c) the Administrative Agent is advised by any Lender that maintenance of its Eurodollar Loans
at a suitable lending office for funding or booking its Loans hereunder would violate any
applicable law, rule, regulation or directive, whether or not having the force of law;

then the Administrative Agent shall give notice thereof to the Borrower and the Lenders by
telephone or facsimile as promptly as practicable thereafter and, until the Administrative Agent
notifies the Borrower and the Lenders that the circumstances giving rise to such notice no longer
exist, (i) any Interest Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective and (ii) if any
Borrowing Request requests a Eurodollar Borrowing, such Borrowing shall be made as an ABR
Borrowing; provided that if the circumstances giving rise to such notice affect only one
Type of Borrowings, then the other Type of Borrowings shall be permitted.

          SECTION 2.15. Increased Costs.

          (a) If any Change in Law shall:

     (i) impose, modify or deem applicable any reserve, special deposit or similar
requirement against assets of, deposits with or for the account of, or credit
extended by, any Lender (except any such reserve requirement reflected in the LIBO
Rate) or the Issuing Lender; or

     (ii) impose on any Lender or the Issuing Lender or the London interbank market
any other condition affecting this Agreement or Eurodollar Loans made by such Lender
or any Letter of Credit or participation therein;

and the result of any of the foregoing shall be to increase the cost to such Lender of making or
maintaining any Eurodollar Loan (or of maintaining its obligation to make any such Loan) or to
increase the cost to such Lender or the Issuing Lender of participating in, issuing or maintaining
any Letter of Credit or to reduce the amount of any sum received or receivable by such Lender or
the Issuing Lender hereunder (whether of principal, interest or otherwise), then the Borrower will
pay to such Lender or the Issuing Lender, as the case may be, such additional amount or amounts as
will compensate such Lender or the Issuing Lender, as the case may be, for such additional costs
incurred or reduction suffered.

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

          (c) A certificate of a Lender or the Issuing Lender setting forth the amount or amounts
necessary to compensate such Lender or the Issuing Lender or its holding company, as the case may
be, as specified in paragraph (a) or (b) of this Section shall be delivered to the Borrower and
shall be conclusive absent manifest error. The Borrower shall pay such Lender or the Issuing
Lender, as the case may be, the amount shown as due on any such certificate within 10 days after
receipt thereof.

          (d) Failure or delay on the part of any Lender or the Issuing Lender to demand compensation
pursuant to this Section shall not constitute a waiver of such Lender’s or the Issuing Lender’s
right to demand such compensation; provided that the Borrower shall not be required to
compensate a Lender or the Issuing Lender pursuant to this Section for any increased costs or
reductions incurred more than 270 days prior to the date that such Lender or the Issuing Lender, as
the case may be, notifies the Borrower of the Change in Law giving rise to such increased costs or
reductions and of such Lender’s or the Issuing Lender’s intention to claim compensation therefor;
provided further that, if the Change in Law giving rise to such increased costs or
reductions is retroactive, then the 270-day period referred to above shall be extended to include
the period of retroactive effect thereof.

          SECTION 2.16. Break Funding Payments. In the event of

          (a) the payment of any principal of any Eurodollar Loan other than on the last day of an
Interest Period applicable thereto (including as a result of an Event of Default),

          (b) the conversion of any Eurodollar Loan to a Loan of a different Interest Period other than
on the last day of the Interest Period applicable thereto,

          (c) the failure to borrow, convert, continue or prepay any Revolving Loan on the date
specified in any notice delivered pursuant hereto (regardless of whether such notice may be revoked
under Section 2.11(b) and is revoked in accordance therewith), or

          (d) the assignment of any Eurodollar Loan other than on the last day of the Interest Period
applicable thereto as a result of a request by the Borrower pursuant to Section 2.19, then, in any
such event, the Borrower shall compensate each Lender for the loss, cost and expense attributable
to such event. In the case of a Eurodollar Loan, such loss, cost or expense to any Lender shall be
deemed to include an amount determined by such Lender to be the excess, if any, of

35

 

     (i) the amount of interest which would have accrued on the principal amount of
such Loan had such event not occurred, at the LIBO Rate that would have been
applicable to such Loan, for the period from the date of such event to the last day
of the then current Interest Period therefor (or, in the case of a failure to
borrow, convert or continue, for the period that would have been the Interest Period
for such Loan), over

     (ii) the amount of interest which would accrue on such principal amount for
such period at the interest rate which such Lender would bid were it to bid, at the
commencement of such period, for dollar deposits of a comparable amount and period
from other banks in the eurodollar market. A certificate of any Lender setting
forth any amount or amounts that such Lender is entitled to receive pursuant to this
Section shall be delivered to the Borrower and shall be conclusive absent manifest
error. The Borrower shall pay such Lender the amount shown as due on any such
certificate within 10 days after receipt thereof.

          SECTION 2.17. Taxes.

          (a) Any and all payments by or on account of any obligation of the Borrower hereunder shall be
made free and clear of and without deduction for any Indemnified Taxes or Other Taxes;
provided that if the Borrower shall be required to deduct any Indemnified Taxes or Other
Taxes from such payments, then

     (i) the sum payable shall be increased as necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section) the Administrative Agent, Lender or Issuing Lender (as the case
may be) receives an amount equal to the sum it would have received had no such
deductions been made,

     (ii) the Borrower shall make such deductions and

     (iii) the Borrower shall pay the full amount deducted to the relevant
Governmental Authority in accordance with applicable law.

          (b) In addition, the Borrower shall pay any Other Taxes to the relevant Governmental Authority
in accordance with applicable law.

          (c) The Borrower shall indemnify the Administrative Agent, each Lender and the Issuing Lender,
within 10 days after written demand therefor, for the full amount of any Indemnified Taxes or Other
Taxes paid by the Administrative Agent, such Lender or the Issuing Lender, as the case may be, on
or with respect to any payment by or on account of any obligation of the Borrower hereunder or
under any other Loan Document (including Indemnified Taxes or Other Taxes imposed or asserted on or
attributable to amounts payable under this Section) and any penalties, interest and reasonable
expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other
Taxes were correctly or legally imposed or asserted by

36

 

the relevant Governmental Authority. A
certificate as to the amount of such payment or liability delivered to the Borrower by a Lender or
the Issuing Lender, or by the Administrative Agent on its own behalf or on behalf of a Lender or
the Issuing Lender, shall be conclusive absent manifest error.

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

          (e) Any Foreign Lender that is entitled to an exemption from or reduction of withholding tax
under the law of the jurisdiction in which the Borrower is located, or any treaty to which such
jurisdiction is a party, with respect to payments under this Agreement shall deliver to the
Borrower (with a copy to the Administrative Agent), at the time or times prescribed by applicable
law, such properly completed and executed documentation prescribed by applicable law or reasonably
requested by the Borrower as will permit such payments to be made without withholding or at a
reduced rate.

          (f) If the Administrative Agent or a Lender determines, in its sole discretion, that it has
received a refund of any Taxes or Other Taxes as to which it has been indemnified by the Borrower
or with respect to which the Borrower has paid additional amounts pursuant to this Section 2.17, it
shall pay over such refund to the Borrower (but only to the extent of indemnity payments made, or
additional amounts paid, by the Borrower under this Section 2.17 with respect to the Taxes or Other
Taxes giving rise to such refund), net of all out-of-pocket expenses of the Administrative Agent or
such Lender and without interest (other than any interest paid by the relevant Governmental
Authority with respect to such refund); provided, that the Borrower, upon the request of the
Administrative Agent or such Lender, agrees to repay the amount paid over to the Borrower (plus any
penalties, interest or other charges imposed by the relevant Governmental Authority) to the
Administrative Agent or such Lender in the event the Administrative Agent or such Lender is
required to repay such refund to such Governmental Authority. This Section shall not be construed
to require the Administrative Agent or any Lender to make available its tax returns (or any other
information relating to its taxes which it deems confidential) to the Borrower or any other Person.

          SECTION 2.18. Payments Generally; Pro Rata Treatment; Sharing of Set-offs.

          (a) The Borrower shall make each payment required to be made by it hereunder or under any
other Loan Document (whether of principal, interest, fees or reimbursement of LC Disbursements, or
of amounts payable under Section 2.15, 2.16 or 2.17, or otherwise) prior to the time expressly
required hereunder or under such other Loan Document for such payment (or, if no time is expressly
required, prior to 12:00 noon, New York City time) on the date when due, in immediately available
funds, without set-off or counterclaim. Any amounts received after such time on any date may, in
the discretion of the Administrative Agent, be deemed to have been received on the next succeeding
Business Day for purposes of calculating interest thereon. All such payments shall be made to the
Administrative Agent at its

37

 

main offices at New York, New York or to such other office within the
United States of America as otherwise designated from time to time by the Administrative Agent,
except payments to be made directly to the Issuing Lender as expressly provided herein and except
that payments pursuant to Sections 2.15, 2.16, 2.17 and 9.03 shall be made directly to the Persons
entitled thereto. The Administrative Agent shall distribute any such payments received by it for
the account of any other Person to the appropriate recipient promptly following receipt thereof.
If any payment hereunder of under any other Loan Document shall be due on a day that is not a
Business Day, the date for payment shall be extended to the next succeeding Business Day, and, in
the case of any payment accruing interest, interest thereon shall be payable for the period of such
extension. All payments hereunder or under any other Loan Document shall be made in dollars.

          (b) If at any time insufficient funds are received by and available to the Administrative
Agent to pay fully all amounts of principal, unreimbursed LC Disbursements, interest and fees then
due hereunder, such funds shall be applied (i) first, towards payment of interest and fees then due
hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest
and fees then due to such parties, and (ii) second, towards payment of principal and unreimbursed
LC Disbursements then due hereunder, ratably among the parties entitled thereto in accordance with
the amounts of principal and unreimbursed LC Disbursements then due to such parties.

          (c) If any Lender shall, by exercising any right of set-off or counterclaim or otherwise,
obtain payment in respect of any principal of or interest on any of its Revolving Loans or
participations in LC Disbursements resulting in such Lender receiving payment of a greater
proportion of the aggregate amount of its Revolving Loans, and participations in LC Disbursements
and accrued interest thereon than the proportion received by any other Lender, then the Lender
receiving such greater proportion shall purchase (for cash at face value) participations in the
Revolving Loans, participations in LC Disbursements of other Lenders to the extent necessary so
that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the
aggregate amount of principal of and accrued interest on their respective Revolving Loans, and
participations in LC Disbursements; provided that

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

     (ii) the provisions of this paragraph shall not be construed to apply to any
payment made by the Borrower pursuant to and in accordance with the express terms of
this Agreement or any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans or participations in LC
Disbursements to any assignee or participant, other than to the Borrower or any
Subsidiary or Affiliate thereof (as to which the provisions of this paragraph shall
apply). The Borrower consents to the foregoing and agrees, to the extent it may
effectively do so under applicable law, that any Lender acquiring a participation
pursuant to the foregoing arrangements may exercise against the Borrower rights of
set-off and counterclaim with respect to such participation as fully as if such
Lender were a direct creditor of the Borrower in the amount of such participation.

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          (d) Unless the Administrative Agent shall have received notice from the Borrower prior to the
date on which any payment is due to the Administrative Agent for the account of the Lenders or the
Issuing Lender hereunder that the Borrower will not make such payment, the Administrative Agent may
assume that the Borrower has made such payment on such date in accordance herewith and may, in
reliance upon such assumption, distribute to the Lenders or the Issuing Lender, as the case may be,
the amount due. In such event, if the Borrower has not in fact made such payment, then each of the
Lenders or the Issuing Lender, as the case may be, severally agrees to repay to the Administrative
Agent forthwith on demand the amount so distributed to such Lender or Issuing Lender with interest
thereon, for each day from and including the date such amount is distributed to it to but excluding
the date of payment to the Administrative Agent, at the greater of the Federal Funds Effective Rate
and a rate determined by the Administrative Agent in accordance with banking industry rules on
interbank compensation.

          (e) If any Lender shall fail to make any payment required to be made by it pursuant to Section
2.05(d) or (e), 2.06(b), 2.18(d) or 9.03(c), then the Administrative Agent may, in its discretion
(notwithstanding any contrary provision hereof), apply any amounts thereafter received by the
Administrative Agent for the account of such Lender to satisfy such Lender’s obligations under such
Sections until all such unsatisfied obligations are fully paid.

          SECTION 2.19. Mitigation Obligations; Replacement of Lenders.

          (a) If any Lender requests compensation under Section 2.15, or if the Borrower is required to
pay any additional amount to any Lender or any Governmental Authority for the account of any Lender
pursuant to Section 2.17, then such Lender shall use reasonable efforts to designate a different
lending office for funding or booking its Loans hereunder or to assign its rights and obligations
hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender,
such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section
2.15 or 2.17, as the case may be, in the future and (ii) would not subject such Lender to any
unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The
Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.

          (b) If any Lender delivers a notice pursuant to Section 2.14(c), or if any Lender requests
compensation under Section 2.15, or if the Borrower is required to pay any additional amount to any
Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.17, or if
any Lender defaults in its obligation to fund Loans hereunder, or if any Lender refuses to consent
to certain proposed changes, waivers, discharges or terminations with respect to this Agreement or
the other Loan Documents requiring the consent of the Required Lenders or all Lenders (or all
affected Lenders) pursuant to Section 9.02 and the same have been approved by such Lenders, as
applicable (or would have been approved by such Lenders with the disapproving Lender’s consent),
then the Borrower may, at its sole expense and effort, upon notice to such Lender and the
Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance
with and subject to the restrictions contained in

39

 

Section 9.04), all its interests, rights and obligations under this Agreement to an assignee
that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such
assignment); provided that

     (i) the Borrower shall have received the prior written consent of the
Administrative Agent (and if a Revolving Commitment is being assigned, the Issuing
Lender), which consent shall not unreasonably be withheld,

     (ii) such Lender shall have received payment of an amount equal to the
outstanding principal of its Loans and participations in LC Disbursements, accrued
interest thereon, accrued fees and all other amounts payable to it hereunder, from
the assignee (to the extent of such outstanding principal and accrued interest and
fees) or the Borrower (in the case of all other amounts) and

     (iii) in the case of any such assignment resulting from a claim for
compensation under Section 2.15 or payments required to be made pursuant to Section
2.17, such assignment will result in a reduction in such compensation or payments.
A Lender shall not be required to make any such assignment and delegation if, prior
thereto, as a result of a waiver by such Lender or otherwise, the circumstances
entitling the Borrower to require such assignment and delegation cease to apply.

ARTICLE III

Representations and Warranties

          The Borrower represents and warrants to the Administrative Agent and the Lenders that:

          SECTION 3.01. Organization; Powers. The Borrower is duly organized, validly existing
and in good standing under the laws of the jurisdiction of its organization, has all requisite
power and authority to carry on its business as now conducted or proposed to be conducted and,
except where the failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, is qualified to do business in, and is in good
standing in, every jurisdiction where such qualification is required. Schedule 3.01 hereto
identifies the Borrower and each Subsidiary, the jurisdiction of its incorporation or organization,
as the case may be, the percentage of issued and outstanding shares of each class of its capital
stock or other equity interests owned by the Borrower or such Subsidiary, and, if such percentage
is not 100% (excluding directors’ qualifying shares as required by law), a description of each
class issued and outstanding. All of the outstanding shares of capital stock and other equity
interests of the Borrower are validly issued and outstanding and fully paid and nonassessable and
all such shares and other equity interests indicated on Schedule 3.01 as owned by the
Borrower are owned, beneficially and of record, by the Borrower free and clear of all Liens (other
than Liens created by the Collateral Documents).

          SECTION 3.02. Authorization; Enforceability. The Transactions are within the
Borrower’s corporate or other organizational powers, as applicable, and have been duly

40

 

authorized by all necessary corporate or other organizational action and, if required,
stockholder or other equity holder action, as applicable. This Agreement, and each of the other
Loan Documents, has been duly executed and delivered by the Borrower and constitutes a legal, valid
and binding obligation of the Borrower, enforceable in accordance with its terms, subject to
applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’
rights generally and subject to general principles of equity, regardless of whether considered in a
proceeding in equity or at law and to requirements of reasonableness, good faith and fair dealing.

          SECTION 3.03. Governmental Approvals; No Conflicts. Except as set forth on
Schedule 3.03, the Transactions

          (a) do not require any consent or approval of, registration or filing with, or any other
action by, any Governmental Authority, except such as have been obtained or made and are in full
force and effect,

          (b) will not violate any applicable law or regulation or the charter, by-laws or other
organizational documents of the Borrower or any order of any Governmental Authority,

          (c) will not violate or result in a default under any indenture, agreement or other instrument
binding upon the Borrower or its assets, or give rise to a right thereunder to require any payment
to be made by the Borrower, and

          (d) will not result in the creation or imposition of any Lien on any asset of the Borrower
except Liens created under the Loan Documents.

          SECTION 3.04. Financial Condition; No Material Adverse Change.

          (a) The Borrower has heretofore furnished to the Lenders its consolidated balance sheet and
statements of income, stockholders equity and cash flows (i) as of and for the fiscal year ended
March 31, 2006 reported on by Deloitte & Touche LLP, independent public accountants and (ii) as of
and for the fiscal quarter and the portion of the fiscal year ended September 30, 2006, certified
by a Financial Officer. Such financial statements present fairly, in all material respects, the
financial position and results of operations and cash flows of the Borrower and its consolidated
Subsidiaries as of such dates and for such periods in accordance with GAAP.

          (b) Except as disclosed in the financial statements referred to above or the notes thereto and
except for the Disclosed Matters, after giving effect to the Transactions, none the Borrower or the
Subsidiaries has, as of the Effective Date, any contingent liabilities that would reasonably be
expected to have a Material Adverse Effect.

          (c) Since March 31, 2006, there has been no material adverse change in the business, assets,
operations, performance, prospects or condition (financial or otherwise) of the Borrower and its
Subsidiaries, taken as a whole, except as disclosed in the Forms 10-Q and 8-K filed by the Borrower
with the Securities and Exchange Commission since March 31, 2006 and prior to the Effective Date.

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          SECTION 3.05. Properties.

          (a) The Borrower has good title to, or valid leasehold interests in, all its real and personal
property material to its business, except for minor defects in title that do not interfere with its
ability to conduct its business as currently conducted or to utilize such properties for their
intended purposes.

          (b) The Borrower owns, or is licensed to use, all trademarks, tradenames, copyrights, patents
and other intellectual property material to its business, and the use thereof by the Borrower does
not infringe upon the rights of any other Person, except for any such infringements that,
individually or in the aggregate, could not reasonably be expected to result in a Material Adverse
Effect.

          (c) Schedule 3.05 sets forth the address of each parcel of real property that is
owned, and each material parcel of property that is leased, by the Borrower or any of the
Subsidiaries.

          SECTION 3.06. Litigation, Labor Matters and Environmental Matters.

          (a) There are no actions, suits or proceedings by or before any arbitrator or Governmental
Authority pending against or, to the knowledge of the Borrower, threatened against or affecting,
the Borrower or any of its Subsidiaries (i) that, if adversely determined, could reasonably be
expected, individually or in the aggregate, to result in a Material Adverse Effect (other than the
Disclosed Matters) or (ii) that involve this Agreement or the Transactions.

          (b) There are no labor controversies pending against or, to the knowledge of the Borrower,
threatened against or affecting the Borrower or any of its Subsidiaries (i) which could reasonably
be expected, individually or in the aggregate, to result in a Material Adverse Effect, or (ii) that
involve this Agreement or the Transactions.

          (c) Except for the Disclosed Matters and except with respect to any other matters that,
individually or in the aggregate, could not reasonably be expected to result in a Material Adverse
Effect, neither the Borrower nor any of its Subsidiaries:

     (i) has failed to comply with any Environmental Law or to obtain, maintain or
comply with any permit, license or other approval required under any Environmental
Law;

     (ii) has become subject to any Environmental Liability;

     (iii) has received notice of any claim with respect to any Environmental
Liability; or

     (iv) knows of any basis for any Environmental Liability.

          (d) Since the date of this Agreement, there has been no change in the status of the Disclosed
Matters that, individually or in the aggregate, has resulted in, or materially increased the
likelihood of, a Material Adverse Effect. The Borrower shall update Schedule 3.06 as and
when appropriate, although the inclusion of new information on Schedule 3.06 shall not mean
that the new development or condition does not constitute a Default.

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          SECTION 3.07. Compliance with Laws and Agreements; No Burdensome Restrictions.

          (a) The Borrower is in compliance with all laws, regulations and orders of any Governmental
Authority applicable to it or its property and all indentures, agreements and other instruments
binding upon it or its property, except where the failure to do so, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse Effect. The Borrower
is not in default in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in any (i) agreement or instrument to which it is a party, which
default would reasonably be expected to have a Material Adverse Effect or (ii) any agreement or
instrument evidencing or governing Indebtedness.

          (b) The Borrower is not party or subject to any law, regulation, rule or order, or any
obligation under any agreement or instrument, that has a Material Adverse Effect.

          (c) The Borrower is not in default in the performance, observance or fulfillment of any of the
obligations, covenants or conditions contained in any (i) agreement or instrument to which it is a
party, which default would reasonably be expected to have a Material Adverse Effect or (ii) any
agreement or instrument evidencing or governing Indebtedness.

          SECTION 3.08. Investment Company Status. The Borrower is not an “investment company”
as defined in, or subject to regulation under, the Investment Company Act of 1940.

          SECTION 3.09. Taxes. The Borrower has timely filed or caused to be filed all Tax
returns and reports required to have been filed and has paid or caused to be paid all Taxes shown
thereon as required to have been paid by it, except (a) Taxes that are being contested in good
faith by appropriate proceedings and for which the Borrower has set aside on its books adequate
reserves in accordance with GAAP or (b) to the extent that the failure to do so could not
reasonably be expected to result in a Material Adverse Effect.

          SECTION 3.10. ERISA. No ERISA Event has occurred or is reasonably expected to occur
that, when taken together with all other such ERISA Events for which liability has occurred or is
reasonably expected to occur, could reasonably be expected to result in a Material Adverse Effect.
The present value of all accumulated benefit obligations under each Plan (based on the assumptions
used for purposes of Statement of Financial Accounting Standards No. 87) did not, as of the date of
the most recent financial statements reflecting such amounts, exceed by more than $1,000,000 the
fair market value of the assets of such Plan, and the present value of all accumulated benefit
obligations of all underfunded Plans (based on the assumptions used for purposes of Statement of
Financial Accounting Standards No. 87) did not, as of the date of the most recent financial
statements reflecting such amounts, exceed by more than $1,000,000 the fair market value of the
assets of all such underfunded Plans.

          SECTION 3.11. Disclosure. The Borrower has disclosed to the Lenders all contractual,
corporate or other restrictions to which it or any of its Subsidiaries is subject, and all other
matters known to it, that, individually or in the aggregate, could reasonably be expected to result
in a Material Adverse Effect. The reports, financial statements, certificates or other

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information furnished by or on behalf of the Borrower to the Administrative Agent or any
Lender in connection with the negotiation of this Agreement or delivered hereunder (as modified or
supplemented by other information so furnished) in the aggregate do not contain any material
misstatement of fact or omits to state any material fact necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading; provided
that, with respect to projected financial information, the Borrower represents only that such
information was prepared in good faith based upon assumptions believed to be reasonable at the
time.

          SECTION 3.12. No Default. The Borrower is in compliance in all material respects with
the terms and conditions of this Agreement, and no Default has occurred and is continuing.

          SECTION 3.13. Liens. There are no Liens on any of the real or personal properties of
the Borrower or any Subsidiary except for Liens permitted by Section 6.02.

          SECTION 3.14. Contingent Obligations. Other than any liability incident to any
litigation, arbitration or proceeding which could not reasonably be expected to have a Material
Adverse Effect, the Borrower has no material contingent obligations not provided for or disclosed
in the financial statements referred to in Section 3.04.

          SECTION 3.15. Regulation U.

          (a) Margin stock (as defined in Regulation U) constitutes less than 25% of the value of those
assets of the Borrower and its Subsidiaries which are subject to any limitation on sale, pledge, or
other restriction hereunder.

          (b) The Borrower shall use the proceeds of the Loans solely for the purposes set forth in
Section 5.08. No part of the proceeds of the Loans will be used, directly or indirectly, for the
purpose of purchasing or carrying any margin stock within the meaning of Regulation U of the Board
or to extend credit to others for the purpose of purchasing or carrying any such margin stock.

          SECTION 3.16. Solvency. Immediately after the consummation of the Transactions to
occur on the Effective Date and immediately following the making of each Loan and each issuance of
a Letter of Credit and after giving effect to the application of the proceeds of such Loans and
Letters of Credit, (a) the fair value (measured on a going concern basis) of the assets of the
Credit Parties, taken as a whole, will exceed their debts and liabilities, subordinated, contingent
or otherwise; (b) the present fair saleable value (measured on a going concern basis) of the
property of the Credit Parties, taken as a whole, will be greater than the amount that will be
required to pay the probable liability of its debts and other liabilities, subordinated, contingent
or otherwise, as such debts and other liabilities become absolute and matured in the ordinary
course of business; (c) the Credit Parties, taken as a whole, will be able to pay their debts and
liabilities, subordinated, contingent or otherwise, as such debts and liabilities become absolute
and matured; and (d) the Credit Parties, taken as a whole, will not have unreasonably small capital
with which to conduct the business in which they are engaged as such business is now conducted and
is proposed to be conducted following the Effective Date.

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          SECTION 3.17. Insurance. The Borrower maintains, with financially sound and reputable
insurance companies, insurance in such amounts and against such risks as are customarily maintained
by companies engaged in the same or similar businesses operating in the same or similar locations.
Schedule 3.17 sets forth a description of all material insurance maintained by or on behalf
of the Borrower as of the Effective Date. As of the Effective Date, all premiums in respect of
such insurance that are due and payable have been paid. The Borrower believes that the insurance
maintained by or on behalf of the Borrower is adequate.

          SECTION 3.18. Collateral Documents. The Collateral Documents create, as security for
the obligations purported to be secured thereby, a valid and enforceable interest in and Lien on
all of the properties covered thereby in favor of the Administrative Agent, and upon the filing of
any financing statements, notices or mortgages contemplated thereby in the offices specified
therein, such Liens (other than Liens permitted under Section 6.02 and the Collateral Documents)
shall be superior to and prior to the right of all third Persons and subject to no other Liens.

ARTICLE IV

Conditions

          SECTION 4.01. Effective Date. The obligations of the Lenders to make Loans and of the
Issuing Lender to issue Letters of Credit hereunder shall not become effective until the date on
which each of the following conditions is satisfied (or waived in accordance with Section 9.02):

          (a) The Administrative Agent (or its counsel) shall have received from each party hereto
either (i) a counterpart of this Agreement signed on behalf of such party or (ii) written evidence
satisfactory to the Administrative Agent (which may include facsimile transmission of a signed
signature page of this Agreement) that such party has signed a counterpart of this Agreement.

          (b) The Administrative Agent shall have received a favorable written opinion (addressed to the
Administrative Agent and the Lenders and dated the Effective Date) of Clifford Chance US LLP,
counsel for the Borrower, substantially in the form of Exhibit D hereto, and covering such
other matters relating to the Credit Parties, this Agreement or the Transactions as the Required
Lenders shall reasonably request. The Borrower hereby requests such counsel to deliver such
opinion.

          (c) The Administrative Agent shall have received such documents and certificates as the
Administrative Agent or its counsel may reasonably request relating to (i) the organization,
existence and good standing of the Borrower, (ii) the authorization of the Transactions and (iii)
any other legal matters relating to the Credit Parties, this Agreement or the Transactions, all in
form and substance satisfactory to the Administrative Agent and its counsel.

          (d) All governmental and third party approvals necessary or, in the discretion of the
Administrative Agent, advisable in connection with the financing
contemplated hereby and the continuing operations of the Borrower and its Subsidiaries shall have been obtained
and be continuing in full force and effect.

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          (e) The Administrative Agent shall have received a certificate, dated the Effective Date and
signed by the President, a Vice President or a Financial Officer of the Borrower, confirming
compliance with the conditions set forth in paragraphs (a) and (b) of Section 4.02.

          (f) The Lenders and the Administrative Agent shall have received all fees and other amounts
due and payable on or prior to the Effective Date, including, to the extent invoiced, reimbursement
or payment of all out-of-pocket expenses required to be reimbursed or paid by the Borrower
hereunder.

          (g) The Administrative Agent shall have determined that (i) there is an absence of any
material adverse change or disruption in primary or secondary loan syndication markets, financial
markets or in capital markets generally that would likely impair syndication of the Loans and other
extensions of credit hereunder, and (ii) the Borrower has cooperated with the Administrative
Agent’s syndication efforts, including, by providing the Administrative Agent with information
regarding the Borrower’s and its Subsidiaries’ operations and prospects and such other information
as the Administrative Agent reasonably deems necessary to successfully syndicate the Loans and
other credit extensions hereunder.

          (h) The Administrative Agent shall have received results satisfactory to the Administrative
Agent of all aspects of its due diligence investigation of the Borrower and its Subsidiaries
(including contingent liabilities and contractual obligations).

          (i) All other legal and regulatory matters shall be satisfactory to the Administrative Agent
and the Lenders.

          (j) There shall be no pending or threatened litigation, arbitration, administrative proceeding
or consent decree that would reasonably be expected to (a) result in a Material Adverse Effect or
(b) have a material adverse effect on the ability of the Credit Parties to consummate the
Transactions.

          (k) The Administrative Agent shall have received such documents and certificates as the
Administrative Agent or its counsel may request, all in form and substance satisfactory to the
Administrative Agent and its counsel and as further described in the list of closing documents
attached as Exhibit F hereto, it being agreed by the Lenders that no blocked account
agreement with HSBC Bank, National Association shall be required provided the Borrower closes its
payroll account with HSBC Bank, National Association within ninety (90) days of the Effective Date
and its non-payroll account within thirty (30) days after the Effective Date.

The Administrative Agent shall notify the Borrower and the Lenders of the Effective Date, and such
notice shall be conclusive and binding. Notwithstanding the foregoing, the obligations of the
Lenders to make Loans and of the Issuing Lender to issue Letters of Credit hereunder shall not
become effective unless each of the foregoing conditions is satisfied (or waived pursuant to

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Section 9.02) at or prior to 3:00 p.m., New York City time, on the date hereof (and, in the event
such conditions are not so satisfied or waived, the Commitments shall terminate at such time).

          SECTION 4.02. Each Credit Event. The obligation of each Lender to make a Loan on the
occasion of any Borrowing, and of the Issuing Lender to issue, amend, renew or extend any Letter of
Credit (including the incorporation of the Existing Letters of Credit hereunder) herein, is subject
to the satisfaction of the following conditions:

          (a) The representations and warranties of the Borrower and its Subsidiaries set forth in this
Agreement and each other Loan Document shall be true and correct in all material respects on and as
of the date of such Borrowing or the date of issuance, amendment, renewal or extension of such
Letter of Credit, as applicable, except to the extent that such representations or warranties were
made with respect to a specific date.

          (b) At the time of and immediately after giving effect to such Borrowing or the issuance,
amendment, renewal or extension of such Letter of Credit, as applicable, no Default shall have
occurred and be continuing.

          (c) At the time of and immediately after giving effect to such Borrowing or the issuance,
amendment, renewal or extension of such Letter of Credit, as applicable, the aggregate of the
Revolving Credit Exposures does not exceed the Aggregate Revolving Commitment.

Each Borrowing and each issuance, amendment, renewal or extension of a Letter of Credit shall be
deemed to constitute a representation and warranty by the Borrower on the date thereof as to the
matters specified in paragraphs (a), (b) and (c) of this Section.

ARTICLE V

Affirmative Covenants

          Until the Commitments have expired or been terminated and the principal of and interest on
each Loan and all fees payable hereunder shall have been paid in full and all Letters of Credit
shall have expired or terminated and all LC Disbursements shall have been reimbursed, the Borrower
covenants and agrees with the Lenders that:

          SECTION 5.01. Financial Statements and Other Information. The Borrower will furnish
to the Administrative Agent and each Lender:

          (a) within 90 days after the end of each fiscal year of the Borrower, its audited consolidated
balance sheet and related statements of operations, stockholders’ equity and cash flows as of the
end of and for such year, setting forth in each case in comparative form the figures for the
previous fiscal year, all reported on by Deloitte & Touche LLP or other independent public
accountants of recognized national standing (without any qualification or exception as to the scope
of such audit) to the effect that such consolidated financial statements present fairly in all
material respects the financial condition and results of operations
of the Borrower and its consolidated Subsidiaries on a consolidated basis in accordance with GAAP
consistently applied;

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          (b) within 45 days after the end of each fiscal quarter of each fiscal year of the Borrower,
its consolidated balance sheet and related statements of operations, stockholders’ equity and cash
flows as of the end of and for such fiscal quarter and the then elapsed portion of the fiscal year,
setting forth in each case in comparative form the figures for the corresponding period or periods
of (or, in the case of the balance sheet, as of the end of) the previous fiscal year and the
figures budgeted for the fiscal quarter reported on, all certified by one of its Financial Officers
as presenting fairly in all material respects the financial condition and results of operations of
the Borrower and its consolidated Subsidiaries on a consolidated basis in accordance with GAAP
consistently applied, subject to normal year-end audit adjustments and the absence of footnotes;

          (c) concurrently with any delivery of financial statements under clause (a) or (b) above, a
certificate (substantially in the form of Exhibit E hereto) of a Financial Officer of the
Borrower (i) certifying as to whether a Default has occurred and, if a Default has occurred,
specifying the details thereof and any action taken or proposed to be taken with respect thereto,
(ii) setting forth reasonably detailed calculations demonstrating compliance with Sections 6.01,
6.04, 6.06, 6.10 and 6.12 through 6.16 and (iii) stating whether any change in GAAP or in the
application thereof has occurred since the date of the audited financial statements referred to in
Section 3.04 and, if any such change has occurred, specifying the effect of such change on the
financial statements accompanying such certificate;

          (d) within thirty (30) days after the end of each month, an unaudited balance sheet and
unaudited statements of income and stockholders’ equity and cash flow of Borrower on a consolidated
basis reflecting results of operations from the beginning of the fiscal year to the end of such
month and for such month, prepared on a basis consistent with prior practices and complete and
correct in all material respects, subject to normal year end audit adjustments and the absence of
footnotes. Each such balance sheet, statement of income and stockholders’ equity and statement of
cash flow shall set forth a comparison of the figures for (x) the current fiscal period and the
current year-to-date with the figures for (y) the same fiscal period and year-to-date period of the
immediately preceding fiscal year and (z) the figures budgeted for the month reported on. The
financial statements shall be accompanied by a certificate of a Financial Officer, which shall
state that, based on an examination sufficient to permit him to make an informed statement, no
Default or Event of Default exists, or, if such is not the case, specifying such Default or Event
of Default, its nature, when it occurred, whether it is continuing and the steps being taken by
Borrower with respect to such event; and

          (e) promptly following any request therefor, such other information regarding the operations,
business affairs and financial condition of the Borrower or any Subsidiary, or compliance with the
terms of this Agreement and any other Loan Document, as the Administrative Agent or any Lender may
reasonably request.

          SECTION 5.02. Borrowing Base; Schedules. The Borrower will furnish to the
Administrative Agent,

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          (a) on a weekly basis, daily sales journals, credit memo journals, cash receipt journals and
sell through reports, in each case, with supporting documentation in such detail as the
Administrative Agent shall require.

          (b) on the third Business Day of each week (or more frequently if required by the
Administrative Agent), a Borrowing Base Certificate (which shall be calculated as of the last day
of the immediately preceding week and which shall not be binding upon the Administrative Agent or
restrictive of the Administrative Agent’s rights under this Agreement).

          (c) on or before the twentieth (20th) day of each month as and for the prior month (i) an
accounts receivable aging, (ii) an accounts payable aging, (iii) an Inventory report, (iv) a
schedule showing all Receivables that constitute Eligible Receivables, (v) a report setting forth
all royalty and license payments made during such preceding month, and if applicable, listing the
license agreements and distribution agreements under which Borrower is then in default in the
payment of any license or royalty fee due thereunder. In addition, Borrower shall deliver to the
Administrative Agent, upon the Administrative Agent’s request, at such intervals as the
Administrative Agent may require: (i) confirmatory assignment schedules, (ii) copies of Customer’s
invoices, (iii) evidence of shipment or delivery, and (iv) such further schedules, documents and/or
information regarding the Collateral as the Administrative Agent may require including trial
balances and test verifications. The Administrative Agent shall have the right to confirm and
verify all Receivables and Inventory by any manner and through any medium it considers advisable
and do whatever it may deem reasonably necessary to protect its interests hereunder.

          (d) on a daily basis, a daily liquidity roll forward in a form and with supporting information
in such detail as the Administrative Agent shall require.

          SECTION 5.03. Notices of Material Events. The Borrower will furnish to the
Administrative Agent and each Lender prompt written notice of the following:

          (a) the occurrence of any Default;

          (b) the filing or commencement of any action, suit or proceeding by or before any arbitrator
or Governmental Authority against or affecting the Borrower or any Affiliate thereof that could
reasonably be expected to result in a Material Adverse Effect;

          (c) the occurrence of any ERISA Event that, alone or together with any other ERISA Events that
have occurred, could reasonably be expected to result in liability of the Borrower and its
Subsidiaries in an aggregate amount exceeding $1,000,000; and

          (d) any other development that results in, or could reasonably be expected to result in, a
Material Adverse Effect.

Each notice delivered under this Section shall be accompanied by a statement of a Financial Officer
or other executive officer of the Borrower setting forth the details of the event or development
requiring such notice and any action taken or proposed to be taken with respect thereto.

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          SECTION 5.04. Existence; Conduct of Business. The Borrower will do or cause to be
done all things necessary to preserve, renew and keep in full force and effect its legal existence
and the business operations and the rights, licenses, permits, privileges and franchises, patents,
copyrights, trademarks and tradenames material to the conduct of its business, except where the
failure to do so, individually or in the aggregate, could not reasonably be expected to result in a
Material Adverse Effect; provided that the foregoing shall not prohibit any merger,
consolidation, liquidation or dissolution permitted under Section 6.03.

          SECTION 5.05. Payment of Obligations. The Borrower will pay its obligations,
including Tax liabilities, that, if not paid, could result in a Material Adverse Effect before the
same shall become delinquent or in default, except where (a) the validity or amount thereof is
being contested in good faith by appropriate proceedings, (b) the Borrower has set aside on its
books adequate reserves with respect thereto in accordance with GAAP and (c) the failure to make
payment pending such contest could not reasonably be expected to result in a Material Adverse
Effect.

          SECTION 5.06. Maintenance of Properties; Insurance. The Borrower will (a) keep and
maintain all property that is material to the conduct of the business of the Borrower in good
working order and condition, ordinary wear and tear excepted, and (b) maintain, with financially
sound and reputable insurance companies, insurance in such amounts and against such risks as are
customarily maintained by companies engaged in the same or similar businesses operating in the same
or similar locations, and the Borrower will furnish to any Lender upon request full information as
to the insurance carried. The Borrower shall deliver to the Administrative Agent endorsements in
form and substance reasonably acceptable to the Administrative Agent (x) to all “All Risk” physical
damage insurance policies on all of the Borrower’s tangible real and personal property and assets
and business interruption insurance policies naming the Administrative Agent as lender loss payee
and (y) to all general liability, property and casualty policies naming the Administrative Agent as
an additional insured; provided, that the Borrower shall not be required to deliver to the
Administrative Agent such endorsements to any automobile insurance policies. In the event the
Borrower at any time or times hereafter shall fail to obtain or maintain any of the policies or
insurance required herein or to pay any premium in whole or in part relating thereto, then the
Administrative Agent, without waiving or releasing any obligations or resulting Event of Default
hereunder, may at any time or times thereafter (but shall be under no obligation to do so) obtain
and maintain such policies of insurance and pay such premiums and take any other action with
respect thereto which the Administrative Agent deems advisable. All sums so disbursed by the
Administrative Agent shall constitute part of the Obligations, payable as provided in this
Agreement. The Borrower shall direct all insurers under policies of property damage, boiler and
machinery and business interruption insurance and payors and any condemnation claim or award
relating to the property to pay all proceeds payable under such policies or with respect to such
claim or award for any loss with respect to the Collateral directly to the Administrative Agent,
for the benefit of the Holders of Obligations, to the extent such proceeds are required to be used
to prepay the Obligations pursuant to the terms hereof or any other Loan Document. Each such
policy shall contain a long-form loss-payable endorsement naming the Administrative Agent as lender
loss payee, which endorsement shall be in form and substance reasonably acceptable to the
Administrative Agent.

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          SECTION 5.07. Books and Records; Inspection Rights. The Borrower will keep proper
books of record and account in which full, true and correct entries are made of all dealings and
transactions in relation to its business and activities. The Borrower will permit any
representatives designated by the Administrative Agent or any Lender, upon reasonable prior notice,
at the sole cost of the Borrower, to visit and inspect any of its property, including the
Collateral, books and financial records of the Borrower, to examine and make extracts from its
books and records and to discuss its affairs, finances and condition with its officers and
independent accountants, all at such reasonable times during normal business hours and as often as
reasonably requested; provided, however, unless an Event of Default has occurred and is continuing,
the Borrower shall only be obligated to pay for the costs and expenses of a total of four (4) such
visits in any fiscal year. In the absence of an Event of Default, the Administrative Agent or any
Lender exercising any rights pursuant to this Section 5.06 shall give Borrower reasonable prior
written notice of such exercise. No notice shall be required during the existence and continuance
of any Default or Event of Default.

          SECTION 5.08. Compliance with Laws. The Borrower will comply with all laws, rules,
regulations and orders (including Environmental Laws) of any Governmental Authority applicable to
it or its property, except where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.

          SECTION 5.09. Use of Proceeds and Letters of Credit. The proceeds of the Loans will
be used only to finance Permitted Acquisitions and for other general corporate purposes and working
capital needs of the Borrower and its Subsidiaries in the ordinary course of business. No part of
the proceeds of any Loan will be used, whether directly or indirectly, for any purpose that entails
a violation of any of the Regulations of the Board, including Regulations T, U and X. Letters of
Credit will be issued for general corporate purposes of the Borrower and its Subsidiaries in the
ordinary course of business.

          SECTION 5.10. Credit Parties Guaranty. The Borrower shall cause each of Borrower’s
Subsidiaries created or acquired after the date hereof which the Administrative Agent has
determined to be active to guarantee pursuant to the Credit Parties Guaranty or a supplement
thereto (or, in the case of a Foreign Subsidiary, any other guarantee agreement requested by the
Administrative Agent) the Obligations. In furtherance of the above, the Borrower shall promptly
(and in any event within 30 days thereof) (i) provide written notice to the Administrative Agent
and the Lenders upon any Person becoming a Subsidiary, setting forth information in reasonable
detail describing all of the assets of such Person, (ii) cause such Person to execute a supplement
to the Credit Parties Guaranty and such other Collateral Documents as are necessary for the
Borrower and its Subsidiaries to comply with this Section 5.10 and Section 5.11, (iii) cause 100%
(or if a Deemed Dividend Problem or foreign withholding tax problem exists, 65%) of the issued and
outstanding equity interests of such Person to be delivered to the Administrative Agent (together
with undated stock powers signed in blank, if applicable) and pledged to the Administrative Agent
pursuant to an appropriate pledge agreement(s) in substantially the form of the Pledge and Security
Agreement (or joinder or other supplement thereto) and otherwise in form reasonably acceptable to
the Administrative Agent and (iv) deliver such other documentation as the Administrative Agent may
reasonably request in connection with the foregoing, including, certified resolutions and other
authority documents of such Person and, to the extent requested by the Administrative Agent,
favorable opinions of counsel to such Person

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(which shall cover, among other things, the legality, validity, binding effect and
enforceability of the documentation referred to above), all in form, content and scope reasonably
satisfactory to the Administrative Agent. Notwithstanding the foregoing, no Foreign Subsidiary
shall be required to execute and deliver the Credit Parties Guaranty (or a supplement thereto) or
such other guarantee agreement or such Collateral Documents if such execution and delivery would
cause a Deemed Dividend Problem or a Financial Assistance Problem with respect to such Foreign
Subsidiary and no current Subsidiary shall be required to execute the Credit Parties Guaranty.

          SECTION 5.11. Collateral.

          (a) The Borrower will cause, and will cause each other Credit Party to cause, all of its owned
property to be subject at all times to first priority, perfected Liens in favor of the
Administrative Agent for the benefit of the Holders of Obligations, to secure the Obligations in
accordance with the terms and conditions of the Collateral Documents, subject in any case to Liens
permitted by Section 6.02 or by the Collateral Documents. Without limiting the generality of the
foregoing, the Borrower will cause 100% (or if a Deemed Dividend Problem or foreign withholding
tax problem exists, 65%) of the issued and outstanding equity interests of each Credit Party
directly owned by the Borrower or any other Credit Party to be subject at all times to a first
priority, perfected Lien in favor of the Administrative Agent (subject in any case to Liens
permitted by Section 6.02 or by the Collateral Documents) in accordance with the terms and
conditions of the Collateral Documents or such other security documents as the Administrative Agent
shall reasonably request, together with such other documentation as the Administrative Agent may
reasonably request in connection with the foregoing, including certified resolutions and other
authority documents of such Person and, to the extent requested by the Administrative Agent,
customary opinions of counsel with respect to such Person (which shall cover, among other things,
the legality, validity, binding effect and enforceability of the documentation referred to above
and attachment and perfection of all Liens thereunder), all in form, content and scope reasonably
satisfactory to the Administrative Agent.

          (b) The Lenders and the Borrower, on behalf of itself and the other Credit Parties,
irrevocably authorize the Administrative Agent, at its option and in its reasonable judgment, in
the event that, at any time, the Administrative Agent determines that it does not have a perfected
Lien on substantially all of the assets of any Credit Party to secure the Obligations, to obtain
perfected Liens on such unencumbered assets as the Administrative Agent deems necessary in
consultation with the Required Lenders to secure the Obligations. The Borrower shall provide, and
cause the other Credit Parties to provide, the Administrative Agent with all information reasonably
requested by the Administrative Agent from time to time related to assets owned by the Borrower and
the Borrower’s Subsidiaries, shall cooperate fully with the Administrative Agent with respect to
the performance of due diligence and the execution of instruments and other Collateral Documents
and making of any filings necessary to facilitate such Lien perfection (including certified
resolutions and other authority documents of any applicable Subsidiary and, to the extent requested
by the Administrative Agent, customary opinions of counsel with respect to such Subsidiary (which
shall cover, among other things, the legality, validity, binding effect and enforceability of the
documentation referred to above and attachment and perfection of all Liens thereunder), all in
form, content and scope reasonably satisfactory to the Administrative Agent) and shall pay all
reasonable costs and expenses

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incurred by the Administrative Agent and its counsel in connection therewith, whereupon such
Subsidiary shall thereafter be deemed a “Credit Party” hereunder. Notwithstanding the foregoing,
no pledge agreement in respect of the Equity Interests of a Foreign Subsidiary shall be required
hereunder to the extent such pledge thereunder is prohibited by applicable law or its counsel
reasonably determines that such pledge would not provide material credit support for the benefit of
the Holders of Obligations pursuant to legally valid, binding and enforceable pledge agreements.

          SECTION 5.12. Employment Contracts. The Borrower shall have and maintain employment
contracts reasonably satisfactory to the Administrative Agent with Bruno Bonnell and David Pierce.

          SECTION 5.13. Ratings. The Borrower will deliver to the Administrative Agent within
sixty (60) days after the Effective Date and on each anniversary of the Effective Date, private
rating letters with respect to the Loans from each of S&P and Moody’s addressed to the
Administrative Agent and the Lenders, each in form and substance acceptable to the Administrative
Agent and with the costs and expenses associated with such letters up to an amount not to exceed
$10,000 per year to be borne by the Borrower.

ARTICLE VI

Negative Covenants

          Until the Commitments have expired or terminated and the principal of and interest on each
Loan and all fees payable hereunder have been paid in full and all Letters of Credit have expired
or terminated and all LC Disbursements shall have been reimbursed, the Borrower covenants and
agrees with the Lenders that:

          SECTION 6.01. Indebtedness. The Borrower will not, and will not permit any Subsidiary
to, create, incur, assume or permit to exist any Indebtedness, except:

          (a) Indebtedness created hereunder;

          (b) Indebtedness existing on the date hereof and set forth in Schedule 6.01 and
extensions, renewals and replacements of any such Indebtedness that do not increase the maximum
principal amount thereof;

          (c) Indebtedness of the Borrower to any Subsidiary Guarantor and of any Subsidiary Guarantor
to the Borrower or any other Subsidiary Guarantor;

          (d) Guarantees by the Borrower of Indebtedness of any Subsidiary Guarantor and by any
Subsidiary Guarantor of Indebtedness of the Borrower or any other Subsidiary Guarantor;

          (e) Indebtedness of the Borrower or any Subsidiary incurred to finance the acquisition,
construction or improvement of any fixed or capital assets, including Capital Lease Obligations and
any Indebtedness assumed in connection with the acquisition of any such assets

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or secured by a Lien on any such assets prior to the acquisition thereof, and extensions,
renewals and replacements of any such Indebtedness that do not increase the outstanding principal
amount thereof; provided that (i) such Indebtedness is incurred prior to or within 90 days after
such acquisition or the completion of such construction or improvement and (ii) the aggregate
principal amount of Indebtedness permitted by this clause (e) shall not exceed $500,000 at any time
outstanding;

          (f) Indebtedness of any Person that becomes a Subsidiary after the date hereof;
provided that (i) such Indebtedness exists at the time such Person becomes a Subsidiary and
is not created in contemplation of or in connection with such Person becoming a Subsidiary and (ii)
the aggregate principal amount of Indebtedness permitted by this clause (f) shall not exceed
$500,000 at any time outstanding;

          (g) Indebtedness of the Borrower or any Subsidiary as an account party in respect of trade
letters of credit; and

          (h) Other unsecured Indebtedness of the Borrower in an aggregate principal amount not
exceeding $500,000 at any time outstanding; provided that the maturity of all such
Indebtedness is subsequent to the Maturity Date and no cash interest is payable on such
Indebtedness.

          SECTION 6.02. Liens. The Borrower will not, and will not permit any Subsidiary to,
create, incur, assume or permit to exist any Lien on any property or asset now owned or hereafter
acquired by it, or assign or sell any income or revenues (including accounts receivable) or rights
in respect of any thereof, except:

          (a) Permitted Encumbrances;

          (b) any Lien on any property or asset of the Borrower or any Subsidiary existing on the date
hereof and set forth in Schedule 6.02; provided that (i) such Lien shall not apply
to any other property or asset of the Borrower or any Subsidiary and (ii) such Lien shall secure
only those obligations which it secures on the date hereof and extensions, renewals and
replacements thereof that do not increase the outstanding principal amount thereof;

          (c) any Lien existing on any property or asset prior to the acquisition thereof by the
Borrower or any Subsidiary or existing on any property or asset of any Person that becomes a
Subsidiary, or merges into the Borrower or a Subsidiary after the date hereof prior to the time
such Person becomes a Subsidiary, or merges into the Borrower or a Subsidiary; provided
that

     (i) such Lien is not created in contemplation of or in connection with such
acquisition or such Person becoming, or merging into, a Subsidiary, as the case may
be,

     (ii) such Lien shall not apply to any other property or assets of the Borrower
or any Subsidiary and

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     (iii) such Lien shall secure only those obligations which it secures on
the date of such acquisition or the date such Person becomes, or merges into, a
Subsidiary, as the case may be and extensions, renewals and replacements thereof
that do not increase the outstanding principal amount thereof;

(d) Liens on fixed or capital assets acquired, constructed or improved by the Borrower or any
Subsidiary; provided that

     (i) such security interests secure Indebtedness permitted by clause (e) of
Section 6.01,

     (ii) such security interests and the Indebtedness secured thereby are incurred
prior to or within 90 days after such acquisition or the completion of such
construction or improvement,

     (iii) the Indebtedness secured thereby does not exceed 100% of the cost of
acquiring, constructing or improving such fixed or capital assets, and

     (iv) such security interests shall not apply to any other property or assets of
the Borrower or any Subsidiary; and

     (v) Liens created by the Collateral Documents.

SECTION 6.03. Fundamental Changes.

(a) The Borrower will not, and will not permit any Subsidiary to, merge into or consolidate
with any other Person, or permit any other Person to merge into or consolidate with it, or sell,
transfer, lease or otherwise dispose (including pursuant to a Sale and Leaseback Transaction) of
(in one transaction or in a series of transactions) any of its assets, or all or substantially all
of the stock of any of its Subsidiaries (in each case, whether now owned or here-after acquired),
or liquidate or dissolve, except that, if at the time thereof and immediately after giving effect
thereto no Default or Event of Default shall have occurred and be continuing

     (i) any Person may merge into the Borrower in a transaction in which the
Borrower is the surviving company,

     (ii) any Subsidiary may merge into any Subsidiary in a transaction in which the
surviving entity is a Subsidiary Guarantor; provided, however, that
in no circumstance shall a Domestic Subsidiary merge into a Foreign Subsidiary in a
transaction in which such Foreign Subsidiary is the surviving entity,

     (iii) any Subsidiary may sell, transfer, lease or otherwise dispose of its
assets to the Borrower or to a Subsidiary Guarantor, and

     (iv) any Subsidiary may liquidate or dissolve if the Borrower determines in
good faith that such liquidation or dissolution is in the best interests of the
Borrower and is not materially disadvantageous to the Lenders; provided

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that any such merger involving a Person that is not a wholly owned Subsidiary
immediately prior to such merger shall not be permitted unless also permitted by
Section 6.04.

          (b) The Borrower will not, and will not permit any of its Subsidiaries to, engage to any
material extent in any business other than businesses (and businesses reasonably related thereto)
of the type conducted by the Borrower and its Subsidiaries on the date of execution of this
Agreement.

          SECTION 6.04. Investments, Loans, Advances, Guarantees and Acquisitions. The Borrower
will not, and will not permit any of its Subsidiaries to, purchase, hold or acquire (including
pursuant to any merger with any Person that was not a wholly owned Subsidiary prior to such merger)
any Equity Interests, evidences of indebtedness or other securities (including any option, warrant
or other right to acquire any of the foregoing) of, make or permit to exist any loans or advances
to, Guarantee any obligations of, or make or permit to exist any investment or any other interest
in, any other Person, or purchase or otherwise acquire (in one transaction or a series of
transactions) any assets of any other Person constituting a business unit, except:

          (a) Permitted Investments;

          (b) investments by the Borrower existing on the date hereof in the capital stock of its
Subsidiaries;

          (c) loans or advances made by the Borrower to any Subsidiary Guarantor and made by any
Subsidiary to the Borrower or any other Subsidiary Guarantor;

          (d) Guarantees constituting Indebtedness permitted by Section 6.01;

          (e) Permitted Acquisitions provided the Total Consideration for all such Acquisitions (other
than consideration financed or paid with newly issued equity) does not exceed $500,000;

          (f) the extension of commercial trade credit in connection with the sale of Inventory in the
ordinary course of its business;

          (g) loans and advances to the Borrower’s employees on an arm’s-length basis in the ordinary
course of business consistent with past practices for travel and entertainment expenses, relocation
costs and similar purposes up to a maximum of $200,000 to any employee and up to a maximum of
$500,000 in the aggregate at any one time outstanding;

          (h) advance payments of production costs and developer’s fees to developers of games marketed
by the Borrower in the ordinary course of business consistent with past practice to Persons that
are not Affiliates of the Borrower; and

          (i) the acquisition by Borrower of the Hot Pixel game and related technology from Parent for
an amount in stock not to exceed $5,000,000.

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          SECTION 6.05. Swap Agreements. The Borrower will not, and will not permit any of its
Subsidiaries to, enter into any Swap Agreement, except

          (a) Swap Agreements entered into to hedge or mitigate risks to which the Borrower or any
Subsidiary has actual exposure (other than those in respect of Equity Interests of the Borrower or
any of its Subsidiaries), and

          (b) Swap Agreements entered into in order to effectively cap, collar or exchange interest
rates (from fixed to floating rates, from one floating rate to another floating rate or otherwise)
with respect to any interest-bearing liability or investment of the Borrower or any Subsidiary.

          SECTION 6.06. Restricted Payments. The Borrower will not, and will not permit any of
its Subsidiaries to, declare or make, or agree to pay or make, directly or indirectly, any
Restricted Payment, except (a) the Borrower may declare and pay dividends with respect to its
Equity Interests payable solely in additional shares of its common stock, (b) Subsidiaries may
declare and pay dividends ratably with respect to their Equity Interests to the Borrower or to
Subsidiary Guarantors, and (c) the Borrower may make Restricted Payments pursuant to and in
accordance with stock option plans or other benefit plans for management or employees of the
Borrower and its Subsidiaries; provided that at the time of such Restricted Payment, and
immediately after giving effect thereto, no Default or Event of Default shall have occurred and be
continuing.

          SECTION 6.07. Transactions with Affiliates. The Borrower will not, and will not
permit any of its Subsidiaries to, sell, lease or otherwise transfer any property or assets to, or
purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other
transactions with, any of its Affiliates, except

          (a) in the ordinary course of business at prices and on terms and conditions not less
favorable to the Borrower or such Subsidiary than could be obtained on an arm’s-length basis from
unrelated third parties,

          (b) transactions between or among the Borrower and its wholly owned Subsidiaries not involving
any other Affiliate,

          (c) pursuant to agreements and arrangements existing on the date hereof as set forth in the
Borrower’s most recent Form 10-K and subsequently-filed Forms 10-Q and 8-K made prior to the date
hereof or on Schedule 6.07(c),

          (d) any Restricted Payment permitted by Section 6.06, and

          (e) the acquisition by Borrower of the Hot Pixel game and related technology from Parent for
an amount in stock not to exceed $5,000,000.

          SECTION 6.08. Restrictive Agreements. The Borrower will not, and will not permit any
of its Subsidiaries to, directly or indirectly, enter into, incur or permit to exist any agreement
(other than the Loan Documents) or other arrangement that prohibits, restricts or imposes any
condition upon

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        (a) the ability of the Borrower or any Subsidiary to create, incur or permit to exist any Lien
upon any of its property or assets, or

        (b) the ability of any Subsidiary to pay dividends or other distributions with respect to any
shares of its capital stock or to make or repay loans or advances to the Borrower or any other
Subsidiary or to Guarantee Indebtedness of the Borrower or any other Subsidiary; provided
that

     (i) the foregoing shall not apply to restrictions and conditions imposed by law
or by this Agreement,

     (ii) the foregoing shall not apply to restrictions and conditions existing on
the date hereof identified on Schedule 6.08 (but shall apply to any
extension or renewal of, or any amendment or modification expanding the scope of,
any such restriction or condition),

     (iii) the foregoing shall not apply to customary restrictions and conditions
contained in agreements relating to the sale of a Subsidiary pending such sale,
provided such restrictions and conditions apply only to the Subsidiary that is to be
sold and such sale is permitted hereunder,

     (iv) clause (a) of the foregoing shall not apply to restrictions or conditions
imposed by any agreement relating to secured Indebtedness permitted by this
Agreement if such restrictions or conditions apply only to the property or assets
securing such Indebtedness, and

     (v) clause (a) of the foregoing shall not apply to customary provisions in
leases and other contracts restricting the assignment thereof.

        SECTION 6.09. Changes in Fiscal Year. The Borrower will not, nor will it permit any
of its Subsidiaries to, change its fiscal year from the basis in effect on the Effective Date.

        SECTION 6.10. Asset Sales. The Borrower will not, nor will it permit any Subsidiary
to, sell, lease or otherwise dispose of its assets to any other Person except for:

        (a) sales of inventory for fair value in the ordinary course of business;

        (b) sales or other dispositions of obsolete, uneconomic or worn-out or no longer used or
useful assets in the ordinary course of business;

        (c) dispositions of cash and Permitted Investments in the ordinary course of business;

        (d) leases, sales or other dispositions of assets for fair value not exceeding $1,000,000 in
aggregate amount during any fiscal year; and

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          (e) the licensing in the ordinary course of its business of intellectual property, other than
where the grant of such license would prohibit the Borrower from continuing to retain full rights
in such intellectual property;

provided that, with respect to any sale, lease or disposition of assets pursuant to this
Section 6.10, (i) the Net Cash Proceeds of such sale or other disposition of assets are applied as
required by Section 2.11(e) and (ii) at the time of such sale or other disposition, and immediately
after giving effect thereto, no Default or Event of Default shall have occurred and be continuing.

          SECTION 6.11. Sale and Leaseback Transactions. No Credit Party shall enter into any
Sale and Leaseback Transaction.

          SECTION 6.12. Minimum Consolidated EBITDA. The Borrower will not permit Consolidated
EBITDA for each month or each fiscal quarter, as applicable, to be less than the following:

	 	 	 	 	 
	Quarter ending December 31, 2006
	 	– $	4,950,000	 
	Quarter ending March 31, 2007
	 	$	1,600,000	 
	Quarter ending June 30, 2007
	 	– $	8,150,000	 
	Quarter ending September 30, 2007
	 	– $	9,800,000	 
	Quarter ending December 31, 2007
	 	$	17,150,000	 
	Quarter ending March 31, 2008
	 	$	725,000	 
	Quarter ending June 30, 2008
	 	– $	3,500,000	 
	Quarter ending September 30, 2008
	 	$	3,725,000	 
	Quarter ending December 31, 2008
	 	– $	750,000	 
	Quarter ending March 31, 2009
	 	– $	5,750,000	 
	Quarter ending June 30, 2009
	 	– $	5,000,000	 
	Quarter ending September 30, 2009
	 	– $	5,000,000	 

          SECTION 6.13. Liquidity. The Borrower and its Domestic Subsidiaries shall not permit
their Unrestricted Liquid Assets to be below $1,000,000 at any time between the Effective Date and
January 31, 2007 or $3,000,000 at any time after January 31, 2007.

          SECTION 6.14. Capital Expenditures. The Borrower will not, nor will it permit any
Subsidiary to, expend, or be committed to expend, in excess of $750,000 for Capital Expenditures of
the Borrower and its Subsidiaries during any fiscal quarter of the Borrower.

          SECTION 6.15. Net Debt. The Borrower will not permit Net Debt as of each date listed
below to be more than the following:

	 	 	 	 	 
	October 31, 2006
	 	$	6,000,000	 
	November 30, 2006
	 	$	15,000,000	 
	December 31, 2006
	 	$	13,000,000	 
	January 31, 2007
	 	$	13,500,000	 
	February 28, 2007
	 	$	13,000,000	 
	March 31, 2007
	 	$	4,000,000	 
	June 30, 2007
	 	– $	1,000,000	 

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	September 30, 2007
	 	 	– $10,000,000	 
	December 31, 2007
	 	 	– $  2,000,000	 
	March 31, 2008
	 	 	– $20,000,000	 
	June 30, 2008
	 	 	– $25,000,000	 
	September 30, 2008
	 	 	– $25,000,000	 
	December 31, 2008
	 	 	– $25,000,000	 
	March 31, 2009
	 	 	– $25,000,000	 
	June 30, 2009
	 	 	– $25,000,000	 
	September 30, 2009
	 	 	– $25,000,000	 

          SECTION 6.16. Subsidiaries. The Borrower will not conduct any material business
through any of its current Subsidiaries, nor will it lend money to or contribute to the capital of
any of its current Subsidiaries.

ARTICLE VII

Events of Default

          If any of the following events (“Events of Default”) shall occur:

          (a) the Borrower shall fail to pay any principal of any Loan or any reimbursement obligation
in respect of any LC Disbursement when and as the same shall become due and payable, whether at the
due date thereof or at a date fixed for prepayment thereof or otherwise;

          (b) the Borrower shall fail to pay any interest on any Loan or any fee or any other amount
(other than an amount referred to in clause (a) of this Article) payable under this Agreement, when
and as the same shall become due and payable, and such failure shall continue unremedied for a
period of five days;

          (c) any representation or warranty made or deemed made by or on behalf of the Borrower or any
Subsidiary in or in connection with this Agreement or any other Loan Document or any amendment or
modification thereof or waiver thereunder, or in any report, certificate, financial statement or
other document furnished pursuant to or in connection with the Loan Documents or any amendment or
modification thereof or waiver thereunder, shall prove to have been incorrect in any material
respect when made or deemed made;

          (d) (i) the Borrower or any Subsidiary shall fail to observe or perform any covenant,
condition or agreement contained in Section 5.03, 5.04 (with respect to organizational existence),
5.09, 5.10 or 5.11 or in Article VI or (ii) any Loan Document shall for any reason not be or shall
cease to be in full force and effect or is declared to be null and void, or the Borrower or any
Subsidiary takes any action for the purpose of terminating, repudiating or rescinding any Loan
Document or any of its obligations thereunder;

          (e) the Borrower or any Subsidiary shall fail to observe or perform any covenant, condition or
agreement contained in this Agreement or in any other Loan Document (other than those specified in
clause (a), (b) or (d) of this Article), and such failure shall continue

60

 

unremedied for a period of 30 days after the earlier to occur of (i) notice thereof from the
Administrative Agent to the Borrower (which notice will be given at the request of any Lender) or
(ii) an officer of the Borrower becomes aware of any such breach;

          (f) the Borrower or any Subsidiary shall fail to make any payment (whether of principal or
interest and regardless of amount) in respect of any Material Indebtedness, when and as the same
shall become due and payable after giving effect to all applicable cure periods;

          (g) any event or condition occurs that results in any Material Indebtedness becoming due prior
to its scheduled maturity or that enables or permits (with or without the giving of notice, the
lapse of time or both) the holder or holders of any Material Indebtedness or any trustee or agent
on its or their behalf to cause any Material Indebtedness to become due, or to require the
prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity;
provided that this clause (g) shall not apply to secured Indebtedness that becomes due as a
result of the voluntary sale or transfer of the property or assets securing such Indebtedness;

          (h) an involuntary proceeding shall be commenced or an involuntary petition shall be filed
seeking (i) bankruptcy, winding up, dissolution, liquidation, reorganization or other relief in
respect of the Borrower or any Subsidiary or its debts, or of a substantial part of its assets,
under any Federal, state or foreign bankruptcy, insolvency, receivership or similar law now or
hereafter in effect or (ii) the appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for the Borrower or any Subsidiary or for a substantial part of its
assets, and, in any such case, such proceeding or petition shall continue undismissed for 60 days
or an order or decree approving or ordering any of the foregoing shall be entered;

          (i) the Borrower or any Subsidiary shall

     (i) voluntarily commence any proceeding or file any petition seeking
bankruptcy, winding up, dissolution, liquidation, reorganization or other relief
under any Federal, state or foreign bankruptcy, insolvency, receivership or similar
law now or hereafter in effect,

     (ii) consent to the institution of, or fail to contest in a timely and
appropriate manner, any proceeding or petition described in clause (h) of this
Article,

     (iii) apply for or consent to the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for the Borrower or any
Subsidiary or for a substantial part of its assets,

     (iv) file an answer admitting the material allegations of a petition filed
against it in any such proceeding,

     (v) make a general assignment for the benefit of creditors or

     (vi) take any action for the purpose of effecting any of the foregoing;

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          (j) the Borrower or any Subsidiary shall become unable, admit in writing its inability or fail
generally to pay its debts as they become due;

          (k) one or more judgments (other than a judgment covered by insurance, but only if the insurer
has admitted liability with respect to such judgment) for the payment of money in an aggregate
amount in excess of $1,000,000 net of insurance shall be rendered against the Borrower, any
Subsidiary or any combination thereof and the same shall remain undischarged for a period of 30
consecutive days during which execution shall not be effectively stayed, or any action shall be
legally taken by a judgment creditor to attach or levy upon any assets of the Borrower or any
Subsidiary to enforce any such judgment;

          (l) an ERISA Event shall have occurred that, in the opinion of the Required Lenders, when
taken together with all other ERISA Events that have occurred, could reasonably be expected to
result in liability of the Borrower and its Subsidiaries in an aggregate amount exceeding
$5,000,000;

          (m) a Change in Control shall occur; or

          (n) any Loan Document shall fail to remain in full force or effect against any Credit Party
party thereto (except to the extent such Credit Party has been released from its obligations
thereunder in accordance with this Agreement or such other Loan Document or such Loan Document has
expired or terminated in accordance with its terms) or any Credit Party shall take any action to
discontinue or to assert the invalidity or unenforceability of, or any action that results in the
discontinuation or invalidity or unenforceability of, any Loan Document in any material respect or
any Lien in favor of the Administrative Agent under the Loan Documents (except as contemplated by
the Loan Documents), or such Lien shall not have the perfection or priority contemplated by the
Loan Documents;

then, and in every such event (other than an event with respect to the Borrower described in clause
(h) or (i) of this Article), and at any time thereafter during the continuance of such event, the
Administrative Agent may, and at the request of the Required Lenders shall, by notice to the
Borrower, take either or both of the following actions, at the same or different times:

     (i) terminate the Commitments, and thereupon the Commitments shall terminate
immediately, and

     (ii) declare the Loans then outstanding to be due and payable in whole (or in
part, in which case any principal not so declared to be due and payable may
thereafter be declared to be due and payable), and thereupon the principal of the
Loans so declared to be due and payable, together with accrued interest thereon and
all fees and other Obligations accrued hereunder and under the other Loan Documents,
shall become due and payable immediately, without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by the Borrower; and in
case of any event with respect to the Borrower described in clause (h) or (i) of
this Article, the Commitments shall automatically terminate and the principal of the
Loans then outstanding, together with accrued interest thereon and all fees and
other Obligations accrued hereunder and under the Loan

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Documents, shall automatically become due and payable, without presentment,
demand, protest or other notice of any kind, all of which are hereby waived by the
Borrower.

ARTICLE VIII

The Administrative Agent

          Each of the Lenders and the Issuing Lender hereby irrevocably appoints the Administrative
Agent as its agent and authorizes the Administrative Agent to take such actions on its behalf and
on behalf of the Holders of Obligations and to exercise such powers as are delegated to the
Administrative Agent by the terms hereof, together with such actions and powers as are reasonably
incidental thereto.

          The Person serving as the Administrative 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 the
Administrative Agent, and such Person and its Affiliates may accept deposits from, lend money to
and generally engage in any kind of business with the Borrower or any Subsidiary or other Affiliate
thereof as if it were not the Administrative Agent hereunder.

          The Administrative Agent shall not have any duties or obligations except those expressly set
forth herein. Without limiting the generality of the foregoing,

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

          (b) the Administrative Agent shall not have any duty to take any discretionary action or
exercise any discretionary powers, except discretionary rights and powers expressly contemplated
hereby that the Administrative Agent is required to exercise in writing as directed by the Required
Lenders (or such other number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 9.02), and

          (c) except as expressly set forth herein, the Administrative Agent shall not have any duty to
disclose, and shall not be liable for the failure to disclose, any information relating to the
Borrower or any of its Subsidiaries that is communicated to or obtained by the bank serving as
Administrative Agent or any of its Affiliates in any capacity. The Administrative Agent shall not
be liable for any action taken or not taken by it with the consent or at the request of the
Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the
circumstances as provided in Section 9.02) or in the absence of its own gross negligence or willful
misconduct. The Administrative Agent shall be deemed not to have knowledge of any Default unless
and until written notice thereof is given to the Administrative Agent by the Borrower or a Lender,
and the Administrative 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,

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     (ii) the contents of any certificate, report or other document delivered
hereunder or in connection herewith,

     (iii) the performance or observance of any of the covenants, agreements or
other terms or conditions set forth herein,

     (iv) the validity, enforceability, effectiveness or genuineness of this
Agreement or any other agreement, instrument or document,

     (v) the satisfaction of any condition set forth in Article IV or elsewhere
herein, other than to confirm receipt of items expressly required to be delivered to
the Administrative Agent, or

     (vi) the perfection or priority of any of the Liens on any of the Collateral.

        The Administrative 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 believed by it to be genuine and to have been signed or sent by the proper Person. The
Administrative Agent also may rely upon any statement made to it orally or by telephone and
believed by it to be made by the proper Person, and shall not incur any liability for relying
thereon. The Administrative Agent may consult with legal counsel (who may be counsel for the
Borrower), 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.

        The Administrative Agent may perform any and all of its duties and exercise its rights and
powers by or through any one or more sub-agents appointed by the Administrative Agent. The
Administrative Agent and any such sub-agent may perform any and all its duties and exercise its
rights and powers through their respective Related Parties. The exculpatory provisions of the
preceding paragraphs shall apply to any such sub-agent and to the Related Parties of the
Administrative 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 Administrative Agent.

        Subject to the appointment and acceptance of a successor Administrative Agent as provided in
this paragraph, the Administrative Agent may resign at any time by notifying the Lenders, the
Issuing Lender and the Borrower. Upon any such resignation, the Required Lenders shall have the
right, in consultation with the Borrower, to appoint a successor. If no successor shall have been
so appointed by the Required Lenders and shall have accepted such appointment within 30 days after
the retiring Administrative Agent gives notice of its resignation, then the retiring Administrative
Agent may, on behalf of the Lenders and the Issuing Lender, appoint a successor Administrative
Agent. Upon the acceptance of its appointment as Administrative Agent hereunder by a successor,
such successor shall succeed to and become vested with all the rights, powers, privileges and
duties of the retiring Administrative Agent, and the retiring Administrative Agent shall be
discharged from its duties and obligations hereunder. The fees payable by the Borrower to a
successor Administrative Agent shall be the same as those payable

64

 

to its predecessor unless otherwise agreed between the Borrower and such successor. After the
Administrative Agent’s resignation hereunder, the provisions of this Article and Section 9.03 shall
continue in effect for the benefit of such retiring Administrative Agent, its sub-agents and their
respective Related Parties in respect of any actions taken or omitted to be taken by any of them
while it was acting as Administrative Agent.

          Each Lender acknowledges that it has, independently and without reliance upon the
Administrative Agent or any other Lender and based on such documents and information as it has
deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each
Lender also acknowledges that it will, independently and without reliance upon the Administrative
Agent or any other Lender 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 related agreement or any document furnished hereunder or thereunder.

          Except with respect to the exercise of setoff rights of any Lender, including the Issuing
Lenders, in accordance with Section 9.08, the proceeds of which are applied in accordance with this
Agreement, each Lender agrees that it will not take any action, nor institute any actions or
proceedings, against the Borrower or with respect to any Loan Document, without the prior written
consent of the Required Lenders or, as may be provided in this Agreement or the other Loan
Documents, with the consent of the Administrative Agent.

          The Lenders, including the Issuing Lenders, are not partners or co-venturers, and no Lender
shall be liable for the acts or omissions of, or (except as otherwise set forth herein in case of
the Administrative Agent) authorized to act for, any other Lender. The Administrative Agent shall
have the exclusive right on behalf of the Lenders to enforce the payment of the principal of and
interest on any Loan or any Letter of Credit after the date such principal or interest has become
due and payable pursuant to the terms of this Agreement.

          In its capacity, the Administrative Agent is a “representative” of the Holders of Obligations
within the meaning of the term “secured party” as defined in the New York Uniform Commercial Code.
Each Lender authorizes the Administrative Agent to enter into each of the Collateral Documents to
which it is a party and to take all action contemplated by such documents. Each Lender agrees that
no Holder of Obligations (other than the Administrative Agent) shall have the right individually to
seek to realize upon the security granted by any Collateral Document, it being understood and
agreed that such rights and remedies may be exercised solely by the Administrative Agent for the
benefit of the Holders of Obligations upon the terms of the Collateral Documents. In the event
that any Collateral is hereafter pledged by any Person as collateral security for the Obligations,
the Administrative Agent is hereby authorized, and hereby granted a power of attorney, to execute
and deliver on behalf of the Holders of Obligations any Loan Documents necessary or appropriate to
grant and perfect a Lien on such Collateral in favor of the Administrative Agent on behalf of the
Holders of Obligations. The Lenders hereby authorize the Administrative Agent, at its option and
in its discretion, to release any Lien granted to or held by the Administrative Agent upon any
Collateral (i) upon termination of the Commitments and payment and satisfaction of all of the
Obligations (other than contingent indemnity obligations and Obligations in respect of Swap
Agreements) at any time arising under or in respect of this Agreement or the Loan Documents or the
transactions

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contemplated hereby or thereby; (ii) as permitted by, but only in accordance with, the terms
of the applicable Loan Document; or (iii) if approved, authorized or ratified in writing by the
Required Lenders, unless such release is required to be approved by all of the Lenders hereunder.
Upon request by the Administrative Agent at any time, the Lenders will confirm in writing the
Administrative Agent’s authority to release particular types or items of Collateral pursuant
hereto. Upon any sale or transfer of assets constituting Collateral which is permitted pursuant to
the terms of any Loan Document, or consented to in writing by the Required Lenders or all of the
Lenders, as applicable, and upon at least five Business Days’ prior written request by the Borrower
to the Administrative Agent, the Administrative Agent shall (and is hereby irrevocably authorized
by the Lenders to) execute such documents as may be necessary to evidence the release of the Liens
granted to the Administrative Agent for the benefit of the Holders of Obligations herein or
pursuant hereto upon the Collateral that was sold or transferred; provided,
however, that (i) the Administrative Agent shall not be required to execute any such
document on terms which, in the Administrative Agent’s opinion, would expose the Administrative
Agent to liability or create any obligation or entail any consequence other than the release 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 (or obligations of the Borrower or any
Subsidiary in respect of) all interests retained by the Borrower or any Subsidiary, including the
proceeds of the sale, all of which shall continue to constitute part of the Collateral.

ARTICLE IX

Miscellaneous

        SECTION 9.01. Notices. (a) Except in the case of notices and other communications
expressly permitted to be given by telephone (and subject to paragraph (b) below), all notices and
other communications provided for herein shall be in writing and shall be delivered by hand or
overnight courier service, mailed by certified or registered mail or sent by facsimile, as follows:

     (i) if to the Borrower, to it at 417 Fifth Avenue, New York, NY 10016,
Attention of Robert Lazzara (Facsimile No. (212) 726-6590, Email address:
robert.lazzara@atari.com), with a copy to Clifford Chance US LLP, 31 West
52nd Street, New York, NY 10019, Attention of Alan M. Christenfeld,
(Facsimile No. (212) 878-8375, Email address:
alan.christenfeld@cliffordchance.com);

     (ii) if to the Administrative Agent, to Guggenheim Corporate Funding, LLC, 135
East 57th Street, 7th Floor, New York, New York 10022,
Attention of Tony Minella, (Facsimile No. (212) 644-8396);

     (iii) if to the Issuing Lender, to it at the address most recently specified by
it in a notice delivered to the Administrative Agent and the Borrower; and

     (iv) if to any other Lender, to it at its address (or facsimile number) set
forth in its Administrative Questionnaire.

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        (b) Notices and other communications to the Lenders hereunder may be delivered or furnished by
electronic communications pursuant to procedures approved by the Administrative Agent; provided
that the foregoing shall not apply to notices pursuant to Article II unless otherwise agreed by the
Administrative Agent and the applicable Lender. The Administrative Agent or the Borrower may, in
its discretion, agree to accept notices and other communications to it hereunder by electronic
communications pursuant to procedures approved by it; provided that approval of such procedures may
be limited to particular notices or communications.

        (c) Any party hereto may change its address or facsimile number for notices and other
communications hereunder by notice to the other parties hereto. All notices and other
communications given to any party hereto in accordance with the provisions of this Agreement shall
be deemed to have been given on the date of receipt.

        SECTION 9.02. Waivers; Amendments.

        (a) No failure or delay by the Administrative Agent, the Issuing Lender or any Lender in
exercising any right or power hereunder or under any other Loan Document shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or further exercise
thereof or the exercise of any other right or power. The rights and remedies of the Administrative
Agent, the Issuing Lender and the Lenders hereunder and under the other Loan Documents are
cumulative and are not exclusive of any rights or remedies that they would otherwise have. No
waiver of any provision of this Agreement or any other Loan Document or consent to any departure by
the Borrower therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) of this Section, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given. Without limiting the generality of the
foregoing, the making of a Loan or issuance of a Letter of Credit shall not be construed as a
waiver of any Default, regardless of whether the Administrative Agent, any Lender or the Issuing
Lender may have had notice or knowledge of such Default at the time.

        (b) Neither this Agreement nor any other Loan Document nor any provision hereof or thereof may
be waived, amended or modified except pursuant to an agreement or agreements in writing entered
into by the Borrower and the Required Lenders or by the Borrower and the Administrative Agent with
the consent of the Required Lenders; provided that no such agreement shall

     (i) increase the Commitment of any Lender without the written consent of such
Lender,

     (ii) reduce the principal amount of any Loan or LC Disbursement or reduce the
rate of interest thereon, or reduce any fees payable hereunder, without the written
consent of each Lender affected thereby,

     (iii) postpone the date of any scheduled payment of the principal amount of any
Loan or LC Disbursement, or any interest thereon, or any fees payable hereunder, or
extend the Maturity Date, or reduce the amount of, waive or

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excuse any such payment, or postpone the scheduled date of expiration of any
Commitment, without the written consent of each Lender affected thereby,

     (iv) change Section 2.18(b) or (c) in a manner that would alter the pro rata
sharing of payments required thereby without the written consent of each Lender,

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

     (vi) other than pursuant to a transaction permitted by the terms of this
Agreement or any other Loan Document, release all or substantially all of the
Collateral or release, limit or condition any Credit Party’s guarantee obligations
under any Loan Document without the written consent of each Lender;

provided further that no such agreement shall amend, modify or
otherwise affect the rights or duties of the Administrative Agent or the Issuing
Lender hereunder or under any other Loan Document without the prior written consent
of the Administrative Agent or the Issuing Lender, as the case may be.

          SECTION 9.03. Expenses; Indemnity; Damage Waiver.

          (a) The Borrower shall pay

     (i) all reasonable out-of-pocket expenses incurred by the Administrative Agent
and its Affiliates, including the reasonable fees, charges and disbursements of
counsel for the Administrative Agent, in connection with the syndication of the
credit facilities provided for herein, the preparation and administration of this
Agreement and the other Loan Documents or any amendments, modifications or waivers
of the provisions hereof or thereof (whether or not the transactions contemplated
hereby or thereby shall be consummated),

     (ii) all reasonable out-of-pocket expenses incurred by the Issuing Lender in
connection with the issuance, amendment, renewal or extension of any Letter of
Credit or any demand for payment thereunder and

     (iii) all out-of-pocket expenses incurred by the Administrative Agent, the
Issuing Lender or any Lender, including the fees, charges and disbursements of any
counsel for the Administrative Agent, the Issuing Lender or any Lender, in
connection with the enforcement or protection of its rights in connection with any
Loan Document, including its rights under this Section, or in connection with the
Loans made or Letters of Credit issued hereunder, including all such out-of-pocket
expenses incurred during any workout, restructuring or negotiations in respect of
such Loans or Letters of Credit, provided that, in the case of a workout

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or a Default, the Borrower shall be obligated to pay the attorneys’ fees and
expenses for only one law firm for the Administrative Agent, the Issuing Lender and
the Lenders in addition to any required local counsel.

          (b) The Borrower shall indemnify the Administrative Agent, the Issuing Lender and each Lender,
and each Related Party of any of the foregoing Persons (each such Person being called an
“Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims,
damages, liabilities and related expenses, including the fees, charges and disbursements of any
counsel for any Indemnitee, incurred by or asserted against any Indemnitee arising out of, in
connection with, or as a result of

     (i) the execution or delivery of this Agreement or any other Loan Document or
any agreement or instrument contemplated hereby or thereby, the performance by the
parties to this Agreement or any other Loan Document of their respective obligations
hereunder or thereunder or the consummation of the Transactions or any other
transactions contemplated hereby or by the other Loan Documents,

     (ii) any Loan or Letter of Credit or the use of the proceeds therefrom
(including any refusal by the Issuing Lender to honor a demand for payment under a
Letter of Credit if the documents presented in connection with such demand do not
strictly comply with the terms of such Letter of Credit),

     (iii) any actual or alleged presence or release of Hazardous Materials on or
from any property owned or operated by the Borrower or any of its Subsidiaries, or
any Environmental Liability related in any way to the Borrower or any of its
Subsidiaries, or

     (iv) any actual or prospective claim, litigation, investigation or proceeding
relating to any of the foregoing, whether based on contract, tort or any other
theory and regardless of whether any Indemnitee is a party thereto; provided
that such indemnity shall not, as to any Indemnitee, be available to the extent that
such losses, claims, damages, liabilities or related expenses are determined by a
court of competent jurisdiction by final and nonappealable judgment to have resulted
from the gross negligence or willful misconduct of such Indemnitee.

          (c) To the extent that the Borrower fails to pay any amount required to be paid by it to the
Administrative Agent or the Issuing Lender or any Related Party of any of them under paragraph (a)
or (b) of this Section, each Lender severally agrees to pay to the Administrative Agent or the
Issuing Lender, as the case may be, such Lender’s Applicable Percentage (determined as of the time
that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount;
provided that the unreimbursed expense or indemnified loss, claim, damage, liability or
related expense, as the case may be, was incurred by or asserted against the Administrative Agent
or the Issuing Lender in its capacity as such.

          (d) To the extent permitted by applicable law, the Borrower shall not assert, and hereby
waives, any claim against any Indemnitee, on any theory of liability, for special,

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indirect, consequential or punitive damages (as opposed to direct or actual damages) arising
out of, in connection with, or as a result of, this Agreement, any other Loan Document or any
agreement or instrument contemplated hereby or thereby, the Transactions, any Loan or Letter of
Credit or the use of the proceeds thereof.

          (e) All amounts due under this Section shall be payable promptly not later than fifteen days
after written demand therefor.

          SECTION 9.04. Successors and Assigns. (a) The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective successors and
assigns permitted hereby (including any Affiliate of the Issuing Lender that issues any Letter of
Credit), except that (i) the Borrower may not assign or otherwise transfer any of its rights or
obligations hereunder without the prior written consent of each Lender (and any attempted
assignment or transfer by the Borrower without such consent shall be null and void) and (ii) no
Lender may assign or otherwise transfer its rights or obligations hereunder except in accordance
with this Section. Nothing in this Agreement, expressed or implied, shall be construed to confer
upon any Person (other than the parties hereto, their respective successors and assigns permitted
hereby (including any Affiliate of the Issuing Lender that issues any Letter of Credit),
Participants (to the extent provided in paragraph (c) of this Section) and, to the extent expressly
contemplated hereby, the Related Parties of each of the Administrative Agent, the Issuing Lender
and the Lenders) any legal or equitable right, remedy or claim under or by reason of this
Agreement.

          (b)(i) Subject to the conditions set forth in paragraph (b)(ii) below, any Lender may assign
to one or more assignees all or a portion of its rights and obligations under this Agreement with
the prior written consent (such consent not to be unreasonably withheld) of:

          (A) the Borrower, provided that no consent of the Borrower shall be
required for an assignment to a Lender, an Affiliate of a Lender, an Approved Fund
or, if an Event of Default has occurred and is continuing, any other assignee;

          (B) the Administrative Agent; and

          (C) the Issuing Lender.

          (ii) Assignments shall be subject to the following additional conditions:

          (A) except in the case of an assignment to a Lender or an Affiliate of a Lender
or an assignment of the entire remaining amount of the assigning Lender’s Commitment
or Loans of any Class, the amount of the Commitment or Loans of the assigning Lender
subject to each such assignment (determined as of the date the Assignment and
Assumption with respect to such assignment is delivered to the Administrative Agent)
shall not be less than (x) with respect to Revolving Loans, the lesser of $1,000,000
and the remaining amount of such Lender’s Revolving Loan Exposure or Revolving
Commitment provided that no such consent of the Borrower shall be required
if an Event of
Default under clause (a), (b), (h) or (i) of Article VII has occurred and is
continuing;

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          (B) each partial assignment shall be made as an assignment of a proportionate
part of all the assigning Lender’s rights and obligations under this Agreement,
provided that this clause shall not be construed to prohibit the assignment
of a proportionate part of all the assigning Lender’s rights and obligations in
respect of one Class of Commitments or Loans;

          (C) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Assumption, together with a processing and
recordation fee of $3,500; and

          (D) the assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire and shall agree to be bound by
Section 9.12 hereof.

          For the purposes of this Section 9.04(b), the term “Approved Fund” has the following
meaning:

          “Approved Fund” means any Person (other than a natural person) that is engaged in
making, purchasing, holding or investing in bank loans and similar extensions of credit in the
ordinary course of its business and that is administered or managed by (a) a Lender, (b) an
Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a
Lender.

          (iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv) of this
Section, from and after the effective date specified in each Assignment and Assumption the assignee
thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment
and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption,
be released from its obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such
Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of
Sections 2.15, 2.16, 2.17 and 9.03). Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this Section 9.04 shall be treated for
purposes of this Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with paragraph (c) of this Section.

          (iv) The Administrative Agent, acting for this purpose as an agent of the Borrower, shall
maintain at one of its offices a copy of each Assignment and Assumption delivered to it and a
register for the recordation of the names and addresses of the Lenders, and the Commitment of and
principal amount of the Loans and LC Disbursements owing to, each Lender pursuant to the terms
hereof from time to time (the “Register”). The entries in the Register shall be
conclusive, and the Borrower, the Administrative Agent, the Issuing Lender and the Lenders may
treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement, notwithstanding notice to the

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contrary. The Register shall be available for inspection by the Borrower, the Issuing Lender
and any Lender, at any reasonable time and from time to time upon reasonable prior notice.

          (v) Upon its receipt of a duly completed Assignment and Assumption executed by an assigning
Lender and an assignee, the assignee’s completed Administrative Questionnaire (unless the assignee
shall already be a Lender hereunder), the processing and recordation fee referred to in paragraph
(b) of this Section and any written consent to such assignment required by paragraph (b) of this
Section, the Administrative Agent shall accept such Assignment and Assumption and record the
information contained therein in the Register; provided that if either the assigning Lender
or the assignee shall have failed to make any payment required to be made by it pursuant to Section
2.04(c), 2.05(d) or (e), 2.06(b), 2.18(d) or 9.03(c), the Administrative Agent shall have no
obligation to accept such Assignment and Assumption and record the information therein in the
Register unless and until such payment shall have been made in full, together with all accrued
interest thereon. No assignment shall be effective for purposes of this Agreement unless it has
been recorded in the Register as provided in this paragraph.

          (c)(i) Any Lender may, without the consent of the Borrower, the Administrative Agent or the
Issuing Lender, sell participations to one or more banks or other entities (a
“Participant”) in all or a portion of such Lender’s rights and obligations under this
Agreement (including all or a portion of its Commitment and the Loans owing to it and its
Deposit); provided that (A) such Lender’s obligations under this Agreement shall remain
unchanged, (B) such Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations and (C) the Borrower, the Administrative Agent, the Issuing Lender
and the other Lenders shall continue to deal solely and directly with such Lender in connection
with such Lender’s rights and obligations under this Agreement. Any agreement or instrument
pursuant to which a Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement; provided that such agreement or instrument may provide
that such Lender will not, without the consent of the Participant, agree to any amendment,
modification or waiver described in the first proviso to Section 9.02(b) that affects such
Participant. Subject to paragraph (c)(ii) of this Section, the Borrower agrees that each
Participant shall be entitled to the benefits of Sections 2.15, 2.16 and 2.17 to the same extent as
if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this
Section. To the extent permitted by law, each Participant also shall be entitled to the benefits
of Section 9.08 as though it were a Lender, provided such Participant agrees to be subject to
Section 2.18(c) as though it were a Lender.

          (ii) A Participant shall not be entitled to receive any greater payment under Section 2.15 or
2.17 than the applicable Lender would have been entitled to receive with respect to the
participation sold to such Participant, unless the sale of the participation to such Participant is
made with the Borrower’s prior written consent. A Participant that would be a Foreign Lender if it
were a Lender shall not be entitled to the benefits of Section 2.17 unless the Borrower is notified
of the participation sold to such Participant and such Participant agrees, for the benefit of the
Borrower, to comply with Section 2.17(e) as though it were a Lender.

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          (d) Any Lender may at any time pledge or assign a security interest in all or any portion of
its rights under this Agreement to secure obligations of such Lender, including without limitation
any pledge or assignment to secure obligations to a Federal Reserve Bank, and this Section shall
not apply to any such pledge or assignment of a security interest; provided that no such
pledge or assignment of a security interest shall release a Lender from any of its obligations
hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

          SECTION 9.05. Survival. All covenants, agreements, representations and warranties
made by the Borrower and its Subsidiaries in the Loan Documents and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement or any other Loan Document
shall be considered to have been relied upon by the other parties hereto and shall survive the
execution and delivery of the Loan Documents and the other Loan Documents and the making of any
Loans and issuance of any Letters of Credit, regardless of any investigation made by any such other
party or on its behalf and notwithstanding that the Administrative Agent, the Issuing Lender or any
Lender may have had notice or knowledge of any Default or incorrect representation or warranty at
the time any credit is extended hereunder, and shall continue in full force and effect as long as
the principal of or any accrued interest on any Loan or any fee or any other amount payable under
this Agreement or any other Loan Document is outstanding and unpaid or any Letter of Credit is
outstanding and so long as the Commitments have not expired or terminated. The provisions of
Sections 2.15, 2.16, 2.17 and 9.03 and Article VIII shall survive and remain in full force and
effect regardless of the consummation of the transactions contemplated hereby, the repayment of the
Loans, the expiration or termination of the Letters of Credit and the Commitments or the
termination of this Agreement or any other Loan Document or any provision hereof or thereof.

          SECTION 9.06. Counterparts; Integration; Effectiveness. This Agreement may be
executed in counterparts (and by different parties hereto on different counterparts), each of which
shall constitute an original, but all of which when taken together shall constitute a single
contract. This Agreement, the other Loan Documents and any separate letter agreements with respect
to fees payable to the Administrative Agent constitute the entire contract among the parties
relating to the subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof. Except as provided in
Section 4.01, this Agreement shall become effective when it shall have been executed by the
Administrative Agent and when the Administrative Agent shall have received counterparts hereof
which, when taken together, bear the signatures of each of the other parties hereto, and thereafter
shall be binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns. Delivery of an executed counterpart of a signature page of this Agreement
by facsimile shall be effective as delivery of a manually executed counterpart of this Agreement.

          SECTION 9.07. Severability. Any provision of this Agreement held to be invalid,
illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the
extent of such invalidity, illegality or unenforceability without affecting the validity, legality
and enforceability of the remaining provisions hereof; and the invalidity of a particular provision
in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.

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          SECTION 9.08. Right of Setoff. If an Event of Default shall have occurred and be
continuing, each Lender and each of its Affiliates is hereby authorized at any time and from time
to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general
or special, time or demand, provisional or final) at any time held and other obligations at any
time owing by such Lender or Affiliate to or for the credit or the account of the Borrower against
any of and all the obligations of the Borrower now or hereafter existing under this Agreement held
by such Lender, irrespective of whether or not such Lender shall have made any demand under this
Agreement and although such obligations may be unmatured. The rights of each Lender under this
Section are in addition to other rights and remedies (including other rights of setoff) which such
Lender may have.

          SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process.

          (a) THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE
OF NEW YORK.

          (b) The Borrower hereby irrevocably and unconditionally submits, for itself and its property,
to the nonexclusive jurisdiction of the Supreme Court of the State of New York sitting in New York
County and of the United States District Court of the Southern District of New York, and any
appellate court from any thereof, in any action or proceeding arising out of or relating to this
Agreement, or for recognition or enforcement of any judgment, and each of the parties hereto hereby
irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding
may be heard and determined in such New York State or, to the extent permitted by law, in such
Federal court. Each of the parties hereto agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment
or in any other manner provided by law. Nothing in this Agreement shall affect any right that the
Administrative Agent, the Issuing Lender or any Lender may otherwise have to bring any action or
proceeding relating to this Agreement against the Borrower or its properties in the courts of any
jurisdiction.

          (c) The Borrower hereby irrevocably and unconditionally waives, to the fullest extent it may
legally and effectively do so, any objection which it may now or hereafter have to the laying of
venue of any suit, action or proceeding arising out of or relating to this Agreement in any court
referred to in paragraph (b) of this Section. Each of the parties hereto hereby irrevocably
waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.

          (d) Each party to this Agreement irrevocably consents to service of process in the manner
provided for notices in Section 9.01. Nothing in this Agreement will affect the right of any party
to this Agreement to serve process in any other manner permitted by law.

          SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL
PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED

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HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES
THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR
OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO
ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION.

          SECTION 9.11. Headings. Article and Section headings and the Table of Contents used
herein are for convenience of reference only, are not part of this Agreement and shall not affect
the construction of, or be taken into consideration in interpreting, this Agreement.

          SECTION 9.12. Confidentiality. Each of the Administrative Agent, the Issuing Lender
and the Lenders agrees to maintain the confidentiality of the Information (as defined below),
except that Information may be disclosed

          (a) to its and its Affiliates’ directors, officers, employees and agents, including
accountants, legal counsel and other advisors (it being understood that the Persons to whom such
disclosure is made will be informed of the confidential nature of such Information and instructed
to keep such Information confidential),

          (b) to the extent requested by any regulatory authority,

          (c) to the extent required by applicable laws or regulations or by any subpoena or similar
legal process,

          (d) to any other party to this Agreement,

          (e) in connection with the exercise of any remedies hereunder or any suit, action or
proceeding relating to this Agreement or the enforcement of rights hereunder,

          (f) subject to an agreement containing provisions substantially the same as those of this
Section, to (i) any assignee of or Participant in, or any prospective assignee of or Participant
in, any of its rights or obligations under this Agreement or (ii) any actual or prospective
counterparty (or its advisors) to any swap or derivative transaction relating to the Borrower and
its obligations,

          (g) with the consent of the Borrower, or

          (h) to the extent such Information

     (i) becomes publicly available other than as a result of a breach of this
Section or

     (ii) becomes available to the Administrative Agent, the Issuing Lender or any
Lender on a nonconfidential basis from a source other than the Borrower.

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For the purposes of this Section, “Information” means all information received from the
Borrower relating to the Borrower or its business, other than any such information that is
available to the Administrative Agent, the Issuing Lender or any Lender on a nonconfidential basis
prior to disclosure by the Borrower; provided that, in the case of information received
from the Borrower after the date hereof, such information is clearly identified at the time of
delivery as confidential.

Any Person required to maintain the confidentiality of Information as provided in this Section
shall be considered to have complied with its obligation to do so if such Person has exercised the
same degree of care to maintain the confidentiality of such Information as such Person would accord
to its own confidential information.

          SECTION 9.13. USA PATRIOT Act. Each Lender that is subject to the requirements of the
USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the
“Act”) hereby notifies the Borrower that pursuant to the requirements of the Act, it is
required to obtain, verify and record information that identifies the Borrower, which information
includes the name and address of the Borrower and other information that will allow such Lender to
identify the Borrower in accordance with the Act.

          SECTION 9.14. Subordination of Intercompany Indebtedness. The Borrower agrees that
any and all claims of the Borrower against any Subsidiary Guarantor with respect to any
“Intercompany Indebtedness” (as hereinafter defined), any endorser, obligor or any other guarantor
of all or any part of the Obligations, or against any of its property shall be subordinate and
subject in right of payment to the prior payment, in full and in cash, of all Obligations;
provided that, and not in contravention of the foregoing, so long as no Event of Default
has occurred and is continuing, the Borrower may make loans to and receive payments in the ordinary
course with respect to such Intercompany Indebtedness from each such guarantor, including, the
Subsidiary Guarantors, to the extent permitted by the terms of this Agreement and the other Loan
Documents. Notwithstanding any right of the Borrower to ask, demand, sue for, take or receive any
payment from any guarantor, including the Subsidiary Guarantors, all rights, liens and security
interests of the Borrower, whether now or hereafter arising and howsoever existing, in any assets
of any such guarantor shall be and are subordinated to the rights of the Holders of Obligations in
those assets. The Borrower shall not have any right to possession of any such asset or to
foreclose upon any such asset, whether by judicial action or otherwise, unless and until all of the
Obligations (other than contingent indemnity obligations) shall have been fully paid and satisfied
(in cash) and all financing arrangements pursuant to any Loan Document among the Borrower and the
Holders of Obligations (or any affiliate thereof) have been terminated. If all or any part of the
assets of any such guarantor, or the proceeds thereof, are subject to any distribution, division or
application to the creditors of such guarantor, whether partial or complete, voluntary or
involuntary, and whether by reason of liquidation, bankruptcy, arrangement, receivership,
assignment for the benefit of creditors or any other action or proceeding, or if the business of
any such guarantor is dissolved or if substantially all of the assets of any such guarantor are
sold, then, and in any such event (such events being herein referred to as an “Insolvency
Event”), any payment or distribution of any kind or character, either in cash, securities or
other property, which shall be payable or deliverable upon or with respect to any Indebtedness of
any guarantor, including the Subsidiary Guarantors, to the Borrower (“Intercompany
Indebtedness”) shall be paid or delivered directly to the

76

 

Administrative Agent for application on any of the Obligations, due or to become due, until
such Obligations (other than contingent indemnity obligations) shall have first been fully paid and
satisfied (in cash). Should any payment, distribution, security or instrument or proceeds thereof
be received by the Borrower upon or with respect to the Intercompany Indebtedness after an
Insolvency Event prior to the satisfaction of all of the Obligations (other than contingent
indemnity obligations) and the termination of all financing arrangements pursuant to any Loan
Document among the Borrower and the Holders of Obligations (and their Affiliates), the Borrower
shall receive and hold the same in trust, as trustee, for the benefit of the Holders of Obligations
and shall forthwith deliver the same to the Administrative Agent, for the benefit of the Holders of
Obligations, in precisely the form received (except for the endorsement or assignment of the
Borrower where necessary), for application to any of the Obligations, due or not due, and, until so
delivered, the same shall be held in trust by the Borrower as the property of the Holder of
Obligations. If the Borrower fails to make any such endorsement or assignment to the
Administrative Agent, the Administrative Agent or any of its officers or employees are irrevocably
authorized to make the same. The Borrower agrees that until the Obligations (other than the
contingent indemnity obligations) have been paid in full (in cash) and satisfied and all financing
arrangements pursuant to any Loan Document among the Borrower and the Holders of Obligations (and
their Affiliates) have been terminated, the Borrower will not assign or transfer to any Person
(other than the Administrative Agent) any claim the Borrower has or may have against any guarantor,
including the Subsidiary Guarantors.

The remainder of this page is intentionally blank.

77

 

          IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their
respective authorized officers as of the day and year first above written.

	 	 	 	 	 
	 	ATARI, INC.

 	 
	 	By  	/s/
David R. Pierce	 
	 	 	Name:  	David R. Pierce	 
	 	 	Title:  	President and Chief Executive Officer	 
	 

Signature Page to Atari Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	MIDLAND NATIONAL LIFE INSURANCE COMPANY,
 as a Lender	 	 
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Partners Advisory Company	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Todd Boehly	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Todd Boehly	 	 
	 	 	Title:    Managing Partner	 	 
	 
	 	 	 	 	 	 
	 	 	NORTH AMERICAN COMPANY FOR LIFE AND HEALTH INSURANCE,
as a Lender	 	 
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Partners Advisory Company	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Todd Boehly	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Todd Boehly	 	 
	 	 	Title:    Managing Partner	 	 
	 
	 	 	 	 	 	 
	 	 	GUGGENHEIM CORPORATE FUNDING, LLC,

individually and as Administrative Agent	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ WR Hagner	 	 
	 

	 	 	 	 	 	 
	 	 	Name: William Hagner	 	 
	 	 	Title:    Director and
Counsel	 	 

Signature Page to Atari Credit Agreement

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