Document:

ex10_7aleaffirstamd083107.htm

     

    
      

      

    

    Exhibit
      10.7(a)

     

    FIRST
      AMENDMENT TO CREDIT AGREEMENT

    

    This
      FIRST AMENDMENT TO CREDIT
      AGREEMENT (the “First Amendment”) dated August 31, 2007, is by and between LEAF
      COMMERCIAL FINANCE CO., LLC, a Delaware limited liability company (the
“Borrower”), and National City Bank, as the sole Lender on the date hereof (the
“Lender”), and as administrative agent and collateral agent (in such capacity,
      the “Agent”) for the Lender and other lenders from time to time (the
“Lenders”).

    

    BACKGROUND

    

    A.           Pursuant
      to that certain Credit Agreement dated June 22, 2007, by and among the Borrower,
      the Lenders and the Agent (as the same may be modified and amended from time
      to
      time, including by this First Amendment, the “Credit Agreement”), the Lenders
      agreed, inter alia, to extend to the Borrower a revolving credit
      facility in the maximum aggregate principal amount of $100,000,000.

    

    B.           The
      Borrower has requested an extension of the maturity date of the facility to
      October 31, 2007, to which the Lenders are willing to agree, on the terms and
      subject to the conditions set forth herein.

    

    NOW,
      THEREFORE, in consideration of the
      foregoing premises and for other good and valuable consideration, the receipt
      and sufficiency of which are hereby acknowledged, and intending to be legally
      bound hereby, the parties hereto agree as follows:

    

    1.      Definitions.

    

    (a)           General
      Rule.  Except as expressly set forth herein, all capitalized terms
      used and not defined herein shall have the respective meanings ascribed thereto
      in the Credit Agreement.

    

    (b)           Additional
      Definition.  The following additional definition shall be added to
      Article 1 of the Credit Agreement to read in its entirety as
      follows:

    

    “First
      Amendment” means the First Amendment to this Agreement dated August 31,
      2007.

    

    (c)           Amended
      Definition.  The following definition in Article 1 of the Credit
      Agreement shall be amended and restated to read in its entirety as
      follows:

    

    “Termination
      Date” means the earliest of (a) October 31, 2007, and (b) the date on which
      the Commitments are terminated in full or permanently reduced to zero pursuant
      to the terms of this Agreement.

    

    2.      Representations
      and Warranties.  The Borrower hereby represents and warrants to
      the Agent and each Lender that:

    

    
      
        
        

      

      
        -
          1
          -

        
          

        

      

      
        
        

      

    

    (a)           Representations.  Each
      of the representations and warranties contained in the Credit Agreement and/or
      the other Credit Documents are true, accurate and correct in all material
      respects on and as of the date hereof as if made on and as of the date hereof,
      except to the extent such representation or warranty was made as of a specific
      date;

    

    (b)           Power
      and Authority.  (i) The Borrower has the power and authority under
      the laws of its jurisdiction of organization and under its organizational
      documents to enter into and perform this First Amendment and any other documents
      which the Agent requires the Borrower to deliver hereunder (this First Amendment
      and any such additional documents delivered in connection with the First
      Amendment are herein referred to as the “Amendment Documents”); and (ii) all
      actions, corporate or otherwise, necessary or appropriate for the due execution
      and full performance by the Borrower of the First Amendment have been adopted
      and taken and, upon their execution, the Credit Agreement, as amended by this
      First Amendment will constitute the valid and binding obligations of the
      Borrower enforceable in accordance with their respective terms (except as may
      be
      limited by applicable insolvency, bankruptcy, moratorium, reorganization, or
      other similar laws affecting enforceability of creditors’ rights generally and
      the availability of equitable remedies);

    

    (c)           No
      Violations of Law or Agreements.  The making and performance of
      the First Amendment will not violate any provisions of any law or regulation,
      federal, state, local, or foreign, or the organizational documents of the
      Borrower, or result in any breach or violation of, or constitute a default
      or
      require the obtaining of any consent under, any agreement or instrument by
      which
      the Borrower or its property may be bound;

    

    (d)           No
      Default.  No Default or Event of Default has occurred and is
      continuing; and

    

    (e)           No
      Material Adverse Effect.  No Material Adverse Effect has occurred
      since June 22, 2007.

    

    3.      Conditions
      to Effectiveness of Amendment.  This First Amendment shall be
      effective upon the Agent’s receipt of the following, each in form and substance
      reasonably satisfactory to the Lenders:

    

    (a)           Amendment
      Documents.  This First Amendment, duly executed by the
      Borrower;

    

    (b)           Consent
      and Waivers.  Copies of any consents or waivers necessary in order
      for the Borrower to comply with or perform any of its covenants, agreements
      or
      obligations contained in any agreement, which are required as a result of the
      Borrower’s execution of this First Amendment, if any; and

    

    (c)           Other
      Documents and Actions.  Such additional agreements, instruments,
      documents, writings and actions as the Lenders may reasonably
      request.

     

    
      
        
        

      

      
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          2
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                               4.       No
        Waiver; Ratification.   The execution, delivery and
        performance of this First Amendment shall not operate as a waiver of any
        right,
        power or remedy of the Agent or the Lenders under the Credit Agreement or
        any
        Credit Document, or constitute a waiver of any provision
        thereof.  Except as expressly modified hereby, all terms, conditions
        and provisions of the Credit Agreement and the other Credit Documents shall
        remain in full force and effect and are hereby ratified and confirmed by
        the
        Borrower.  Nothing contained herein constitutes an agreement or
        obligation by the Agent or any Lender to grant any further amendments to
        any of
        the Credit Documents.

    

    

    5.      Acknowledgments.  To
      induce the Lenders to enter into this First Amendment, the Borrower
      acknowledges, agrees, warrants, and represents that:

    

    (a)           Acknowledgment
      of Obligations; Collateral; Waiver of Claims. (i) The Credit Documents are
      valid and enforceable against, and all of the terms and conditions of the Credit
      Documents are binding on, the Borrower; (ii) the liens and security interests
      granted to the Agent by the Borrower pursuant to the Credit Documents are valid,
      legal and binding, properly recorded or filed and first priority perfected
      liens
      and security interests; and (iii) the Borrower hereby waives any and all
      defenses, set-offs and counterclaims which it may have or claim to have against
      the Agent or any Lender as of the date hereof.

    

    (b)           No
      Waiver of Existing Defaults.  No Default or Event of Default
      exists immediately before or immediately after giving effect to this First
      Amendment.  Nothing in this First Amendment nor any communication
      between the Agent, any Lender, the Borrower or any of their respective officers,
      agents, employees or representatives shall be deemed to constitute a waiver
      of
      (i) any Default or Event of Default arising as a result of the foregoing
      representation proving to be false or incorrect in any material respect; or
      (ii)
      any rights or remedies which the Agent or any Lender has against the Borrower
      under the Credit Agreement or any other Credit Document and/or applicable law,
      with respect to any such Default or Event of Default arising as a result of
      the
      foregoing representation proving to be false or incorrect in any material
      respect.

    

    6.      Binding
      Effect.  This First Amendment shall be binding upon and inure to
      the benefit of the parties hereto and their respective successors and
      assigns.

    

    7.      Governing
      Law.  This First Amendment and all rights and obligations of the
      parties hereunder shall be governed by and be construed and enforced in
      accordance with the laws of the internal laws of the Commonwealth of
      Pennsylvania.

    

    8.      Headings.  The
      headings of the sections of this First Amendment are inserted for convenience
      only and shall not be deemed to constitute a part of this First
      Amendment.

    

    9.      Counterparts.  This
      First Amendment may be executed in any number of counterparts with the same
      affect as if all of the signatures on such counterparts appeared on one document
      and each counterpart shall be deemed an original.

    

    
      
        
        

      

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

     

    

     

    LEAF
      COMMERCIAL FINANCE CO.,
      LLC

    

    By:
      ________________________________

           Name:  Crit
      DeMent

           Title:    Chairman,
      CEO

    

    

    NATIONAL
      CITY BANK,

    as
      Agent and as the
      Lender

    

    By:
      ________________________________

           Name:  Chrislos
      Kytzidis

           Title:    Senior
      Vice President

     

     

    - 4
      -EX-4.8

Exhibit 4.8

MEZZANINE PROMISSORY NOTE

$5,000,000.00 December 11, 2007

Dover Saddlery, Inc., a Delaware corporation (“Borrower”), FOR VALUE RECEIVED, promises to pay
to the order of BCA Mezzanine Fund, L.P., a Delaware limited partnership, or its assigns
(“Lender”), to such Person(s) and at such place(s) as Lender may from time to time designate in
writing, the principal sum of Five Million and No/100 DOLLARS ($5,000,000.00) or so much thereof as
may from time to time have been advanced to Borrower under this Note with interest on the
outstanding principal amount at the rates set forth herein.

SECTION 1 — DEFINITIONS

For the purpose of this Note capitalized terms not defined below will be as defined in the
Loan Agreement:

“Business Day” shall mean any day other than a Saturday, Sunday or day which shall be in the
State of Rhode Island a legal holiday or day on which banking institutions are required or
authorized to close.

“Default Interest” shall mean any interest accruing at the Default Interest Rate and payable
pursuant to the terms hereof or of the other Loan Documents.

“Default Interest Rate” shall mean a rate of interest per annum equal to the lesser of either
(a) three percent (3%) above the Interest Rate, or (b) the maximum rate of interest which may be
collected from Borrower under applicable law.

“Initial Interest Payment Date” shall be January 4, 2008.

“Interest Deficit” shall have the meaning ascribed to it in Section 2.8 hereof.

“Interest Rate” shall mean a rate of interest equal to fourteen percent (14%) per annum.

“Late Charge” shall mean the lesser of (a) two percent (2%) of any unpaid amount, or (b) the
maximum late charge permitted to be charged under applicable law.

“Loan Agreement” shall mean that certain Mezzanine Loan Agreement, between Lender and
Borrower, dated of even date herewith, corresponding to this Note, as the same may hereafter be
amended, modified and restated from time to time.

“Loan Documents” shall mean the Loan Agreement and all other documents, agreements and
instruments delivered in connection therewith.

“Maturity Date” shall mean the date that is the fifth (5th) year anniversary of the
date hereof.

“Note” shall mean this Mezzanine Promissory Note of Borrower in the original principal amount
of $5,000,000.00 payable to Lender.

“Payment Date” shall mean the fifth (5th) day of each of January, April, July and
October, commencing on the Initial Interest Payment Date (or, if any such date is not a Business
Day, then the first Business Day immediately before such date).

“Prepayment Fee” shall have the meaning ascribed to it in Schedule A hereto.

SECTION 2 — STATED MATURITY; INTEREST AND PRINCIPAL PAYMENTS.

2.1 Payment of Interest. Interest on the principal balance of this Note outstanding
shall accrue from the date hereof until paid in full whether before or after maturity at the
Interest Rate and be payable as follows:

(a) Commencing on the Initial Interest Payment Date, interest in the amount of
twelve percent (12%) per annum shall be payable quarterly in arrears on each Payment
Date through the Maturity Date.

(b) The remaining two percent (2%) per annum shall be deferred and shall be compounded
annually at the Interest Rate and payable on the Maturity Date.

(c) The Borrower may pay the entire Interest Rate on a current basis.

2.2 Payments of Principal. Installments of principal shall be payable as follows:

(a) On the Maturity Date, all outstanding principal under this Note shall be
immediately due and payable.

2.3 Payment on Maturity Date. Notwithstanding anything herein to the contrary, all
outstanding principal and accrued interest under this Note shall be due and payable in full at the
Maturity Date.

2.4 Computation of Interest. Interest under this Note shall be calculated based on
actual days elapsed and a three hundred sixty (360) day year.

2.5 Method of Payment. Each payment due hereunder shall not be deemed received by
Lender until received on a Business Day (as hereafter defined) in Federal funds in lawful money of
the United States of America immediately available to Lender prior to 2:00 p.m. local time at the
place then designated by Lender. Any payment received on a Business Day after the time established
by the preceding sentence, shall be deemed to have been received on the immediately following
Business Day for all purposes.

2.6 Application of Payments. Payments under this Note shall be applied first to the
payment of Late Charges and Default Interest and other costs and charges due in connection with
this Note, as Lender determines in its sole discretion, then to the payment of accrued but unpaid
interest, and then to reduction of the outstanding principal balance (first to payment of any
current installment and the balance in inverse order of maturity whether or not then due). No
principal amount repaid may be reborrowed. All amounts due under this Note shall be payable
without setoff, counterclaim or any other deduction whatsoever.

2.7 Prepayment. The principal balance of this Note may be prepaid in whole or in
part, on any Payment Date, provided, that (i) Borrower so notifies Lender in writing no more than
sixty (60) days and not less than thirty (30) days prior to the intended date of such prepayment;
(ii) such prepayment is accompanied by all accrued interest and all other outstanding amounts then
due hereunder and under the other Loan Documents if prepaid in full; and (iii) such prepayment
includes the Prepayment Fee. If any prepayment is made hereunder without the prior notice required
by clause (i) above, then, in addition to the Prepayment Fee, Borrower shall further pay an amount
equal to the lesser of (a) thirty (30) days interest computed on the outstanding principal balance
of this Note so prepaid, or (b) interest computed on the outstanding principal balance of this Note
so prepaid for the period from, and including, the date of prepayment through the Maturity Date.

2.8 Interest Deficits. If the provisions of this Note at any time require payment by
the Borrower to the Lender of an amount of interest in excess of the maximum amount then permitted
by applicable law, the interest payments to the Lender shall be reduced to the extent necessary so
that the Lender shall not receive interest in excess of such maximum amount. If as a result of the
foregoing the Lender shall receive interest payments hereunder in an amount less than otherwise
provided hereunder, such deficit (hereinafter called the “Interest Deficit”) will to the fullest
amount permitted by applicable law, cumulate and carry forward (without interest) until the
repayment in full of this Note. Interest otherwise payable to the Lender hereunder for any
subsequent period shall be increased by the maximum amount of the Interest Deficit that may be so
added without causing the Lender to receive interest in excess of the maximum amount permitted by
applicable law. The remaining amount of any Interest Deficit shall be treated as an additional
prepayment penalty and shall be paid in full at the time any repayment in full by the Borrower to
the Lender of the entire remaining principal amount hereof if such payment is made prior to the
Maturity Date.

SECTION 3 — DEFAULT; REMEDIES

3.1 Acceleration. Lender may, by notice to Borrower at any time during the existence
of an Event of Default, declare immediately due and payable the entire principal amount outstanding
hereunder together with all interest and other charges due hereunder including, without limitation,
all Late Charges, Default Interest and Prepayment Fee, if applicable.

3.2 Default Interest Rate; Late Charges.

(a) After an Event of Default and until the Default is cured, the Default Interest
Rate shall apply, in place of the then-applicable Interest Rate, to all amounts
outstanding under the Loan. Such Default Interest shall be compounded on the
quarterly anniversary of such Event of Default until paid in full.

(b) If any quarterly installment due hereunder is not received by Lender on or
before the fifth (5th) day following each Payment Date or if any other
amount payable under this Note or any other Loan Document is not received by Lender
within five (5) days after the date such amount is due, counting from and including
the date such amount is due, Borrower shall pay to Lender, immediately and without
demand by Lender, the Late Charge on such outstanding monthly installment or other
amount due. Borrower acknowledges that its failure to make timely payments will
cause Lender to incur additional expenses in servicing and processing the Loan, and
that it is extremely difficult and impractical to determine those additional
expenses. Borrower agrees that any such Late Charges payable pursuant to this
Section 3.2(b) represents a fair and reasonable estimate, taking into account all
circumstances existing on the first Payment Date, of the additional expenses Lender
will incur by reason of such late payment. Any such Late Charge is payable in
addition to, and not in lieu of, any interest payable at the Default Rate pursuant
to Section 3.2(a).

3.3 Remedies. The remedies of Lender as provided herein, or in the Loan Documents, or
at law or in equity shall be cumulative and concurrent, and may be pursued singly, successively, or
together at the sole discretion of Lender, and may be exercised as often as occasion therefor shall
occur. The failure at any time to exercise any right or remedy shall not constitute a waiver of
the right to exercise the right or remedy at any other time.

SECTION 4 — SECURITY

This Note is secured by the Security Agreement and the Subsidiary Guarantee Agreement.

SECTION 5 — WAIVER

Presentment for payment, demand, notice of dishonor, protest, and notice of protest, stay of
execution and all other defenses to payment generally are hereby waived by Borrower. No extension
or indulgence or release of collateral granted from time to time shall be construed as a novation
of this Note or as a reinstatement of the indebtedness evidenced hereby or as a waiver of the
rights of Lender herein.

SECTION 6 — EXCULPATION

Notwithstanding anything to the contrary contained in this Note, neither Lender nor any
present or future shareholder, director, officer or partner of Lender or of any entity which is now
or hereafter a shareholder, director, officer or partner of Lender (or of any entity which is now
or hereafter a shareholder, director, officer or partner of a shareholder, director, officer or
partner of Lender) shall have any personal liability, directly or indirectly, under or in
connection with this Note or any agreement made or entered into under or in connection with the
provisions of this Note, or any amendment or amendments to any of the foregoing made at any time or
times, heretofore or hereafter, and Borrower hereby forever and irrevocably waives and releases any
and all such personal liability. The limitation of liability provided in this paragraph is in
addition to, and not in limitation of, any limitation on liability applicable to Lender provided by
law or by any other contract, agreement or instrument.

SECTION 7 — GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL; SEVERABILITY;
USURY, ETC.

7.1 Governing Law. This Note shall be governed by, and construed in accordance with,
the substantive law of the State of Rhode Island without regard to the application of choice of law
principles.

7.2 SUBMISSION TO JURISDICTION/SERVICE OF PROCESS. BORROWER HEREBY IRREVOCABLY
SUBMITS TO THE JURISDICTION OF THE STATE AND FEDERAL COURTS OF THE STATE OF RHODE ISLAND FOR THE
PURPOSES OF ANY SUIT, ACTION OR OTHER PROCEEDING ARISING OUT OF OR BASED UPON THIS NOTE, THE
SUBJECT MATTER HEREOF, ANY OTHER LOAN DOCUMENT AND THE SUBJECT MATTER THEREOF. BORROWER TO THE
EXTENT PERMITTED BY APPLICABLE LAW (A) HEREBY WAIVES, AND AGREES NOT TO ASSERT, BY WAY OF MOTION,
AS A DEFENSE, OR OTHERWISE, IN ANY SUCH SUIT, ACTION OR OTHER PROCEEDING BROUGHT IN THE ABOVE-NAMED
COURTS ANY CLAIM THAT IT IS NOT SUBJECT PERSONALLY TO THE JURISDICTION OF SUCH COURTS, THAT ITS
PROPERTY IS EXEMPT OR IMMUNE FROM ATTACHMENT OR EXECUTION, THAT THE SUIT, ACTION OR PROCEEDING IS
BROUGHT IN AN INCONVENIENT FORUM, THAT THE VENUE OF THE SUIT, ACTION OR PROCEEDING IS IMPROPER OR
THAT THIS NOTE, THE SUBJECT MATTER HEREOF, THE OTHER LOAN DOCUMENTS OR THE SUBJECT MATTER THEREOF
(AS APPLICABLE) MAY NOT BE ENFORCED IN OR BY SUCH COURT, (B) HEREBY WAIVES THE RIGHT TO REMOVE ANY
SUCH ACTION, SUIT OR PROCEEDING INSTITUTED BY A LENDER IN STATE COURT TO FEDERAL COURT, OR TO
REMAND AN ACTION INSTITUTED IN FEDERAL COURT TO STATE COURT AND (C) HEREBY WAIVES THE RIGHT TO
ASSERT IN ANY SUCH ACTION, SUIT OR PROCEEDING ANY OFFSETS OR COUNTERCLAIMS EXCEPT COUNTERCLAIMS
THAT ARE COMPULSORY OR OTHERWISE ARISE FROM THE SAME SUBJECT MATTER. BORROWER HEREBY CONSENTS TO
SERVICE OF PROCESS BY MAIL AT THE ADDRESS TO WHICH NOTICES ARE TO BE GIVEN TO IT PURSUANT TO
SECTION 8 HEREOF. BORROWER AGREES THAT ITS SUBMISSION TO JURISDICTION AND CONSENT TO SERVICE OF
PROCESS BY MAIL IS MADE FOR THE EXPRESS BENEFIT OF LENDER. FINAL JUDGMENT AGAINST BORROWER IN ANY
SUCH ACTION, SUIT OR PROCEEDING SHALL BE CONCLUSIVE, AND MAY BE ENFORCED IN ANY OTHER JURISDICTION
(X) BY SUIT, ACTION OR PROCEEDING ON THE JUDGMENT, A CERTIFIED OR TRUE COPY OF WHICH SHALL BE
CONCLUSIVE EVIDENCE OF THE FACT AND OF THE AMOUNT OF INDEBTEDNESS OR LIABILITY OF BORROWER THEREIN
DESCRIBED, OR (Y) IN ANY OTHER MANNER PROVIDED BY OR PURSUANT TO THE LAWS OF SUCH OTHER
JURISDICTION, PROVIDED, HOWEVER, THAT THE LENDER MAY AT ITS OPTION BRING SUIT, OR
INSTITUTE OTHER JUDICIAL PROCEEDINGS, AGAINST BORROWER OR ANY OF ITS ASSETS IN ANY STATE OR FEDERAL
COURT OF THE UNITED STATES OR OF ANY COUNTRY OR PLACE WHERE THE SUBMITTING PARTY OR SUCH ASSETS MAY
BE FOUND.

7.3 WAIVER WITH RESPECT TO DAMAGES. BORROWER ACKNOWLEDGES THAT LENDER DOES NOT HAVE
ANY FIDUCIARY RELATIONSHIP WITH, OR FIDUCIARY DUTY TO, BORROWER ARISING OUT OF OR IN CONNECTION
WITH THIS NOTE OR ANY OTHER LOAN DOCUMENT AND THE RELATIONSHIP BETWEEN LENDER AND BORROWER, IN
CONNECTION HEREWITH AND THEREWITH IS SOLELY THAT OF DEBTOR AND CREDITOR. TO THE EXTENT PERMITTED
BY APPLICABLE LAW, BORROWER SHALL NOT ASSERT, AND BORROWER HEREBY WAIVES, ANY CLAIMS AGAINST
LENDER, ON ANY THEORY OF LIABILITY, FOR SPECIAL, INDIRECT, CONSEQUENTIAL OR PUNITIVE DAMAGES (AS
OPPOSED TO DIRECT OR ACTUAL DAMAGES) ARISING OUT OF, IN CONNECTION WITH, OR AS A RESULT OF, THIS
NOTE, ANY OTHER LOAN DOCUMENT, ANY AGREEMENT OR INSTRUMENT CONTEMPLATED HEREBY OR THEREBY, OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

7.4 WAIVER BY JURY TRIAL. BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVES ANY RIGHT THAT BORROWER MAY HAVE TO A TRIAL BY JURY IN ANY LITIGATION ARISING IN ANY WAY IN
CONNECTION WITH THIS NOTE OR ANY OF THE OTHER LOAN DOCUMENTS, OR ANY OTHER STATEMENTS OR ACTIONS OF
THE LENDER. BORROWER ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT FOR THE LENDER TO
DISBURSE THE MONEY EVIDENCED BY THIS NOTE AND TO ENTER INTO THE OTHER LOAN DOCUMENTS.

7.5 Severability. If any provision of this Note is held to be invalid or
unenforceable by a court of competent jurisdiction, the other provisions of this Note shall remain
in full force and effect, and shall be liberally construed in favor of Lender.

SECTION 8 — NOTICES

8.1 Notices. All notices, demands and other communications (“notice”) under or
concerning this Note shall be in writing. Each notice shall be addressed to the intended recipient
at its address set forth in the Loan Agreement and shall be deemed given on the earliest to occur
of (1) the date when the notice is received by the addressee; (2) the first (1st) Business Day
after the notice is delivered to a recognized overnight courier service, with arrangements made for
payment of charges for next Business Day delivery; or (3) the third (3rd) Business Day
after the notice is deposited in the United States mail with postage prepaid, certified mail,
return receipt requested.

8.2 Change of Address for Notice. Any party to this Agreement may change the address
to which notices intended for it are to be directed by means of notice given to the other party in
accordance with this Section 8. Each party agrees that it will not refuse or reject delivery of
any notice given in accordance with this Section 8, that it will acknowledge, in writing, the
receipt of any notice upon request by the other party and that any notice rejected or refused by it
shall be deemed for purposes of this Section 8 to have been received by the rejecting party on the
date so refused or rejected, as conclusively established by the records of the U.S. Postal Service
or the courier service. Any notice under this Note and any other Loan Document which does not
specify how notices are to be given shall be given in accordance with this Section 8.

SECTION 9 — MISCELLANEOUS

9.1 Costs. If, and as often as, this Note is referred to an attorney for the
collection of any sum payable hereunder, or to defend or enforce any of Lender’s rights hereunder,
or to commence an action, cross-claim, third-party claim or counterclaim by Lender against Borrower
relating to this Note, Borrower agrees to pay to Lender all costs incurred in connection therewith
including reasonable attorney’s fees (including such fees incurred in appellate, bankruptcy or
insolvency proceedings), with or without the institution of any action or proceeding, and in
addition all costs, disbursements and allowances provided by law.

9.2 Modification. Neither this Note nor any of the terms hereof may be terminated,
amended, supplemented, waived or modified orally, but only by an instrument in writing executed by
the party against which enforcement of the termination, amendment, supplement, waiver or
modification is sought.

9.3 Successors. As used herein, the terms “Borrower” and “Lender” shall be deemed to
include their respective successors and assigns whether by voluntary action of the parties or by
operation of law. All of the rights, privileges and obligations hereof shall inure to the benefit
of and bind such successors and assigns.

9.4 Business Purpose. The undersigned represents and agrees that this Note evidences
indebtedness arising from the regular conduct of Borrower’s business (which is carried on for the
purpose of profit), and that the indebtedness evidenced hereby constitutes a business loan and is
not usurious under either the laws of the State of Rhode Island or of the jurisdiction in which the
Borrower conducts its business.

9.5 Loan Agreement. To the extent not expressly stated otherwise herein, all of the
terms and conditions of the Loan Agreement shall survive the execution of this Note and shall
remain in full force and effect; provided, however, to the extent of any irreconcilable conflict
between the terms and conditions of the Loan Agreement and this Note, the terms and provisions of
this Note shall govern and control.

9.6 No Waiver. No failure or delay by Lender in exercising any right, power or
privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of
any right, power or privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. Without limiting the foregoing, no disbursement
by Lender after a default by Borrower hereunder shall constitute a waiver of any of the Lender’s
remedies established or referred to hereunder or shall obligate Lender to make any further
disbursement. No waiver, consent or approval of any kind by Lender shall be effective unless (and
it shall be effective only to the extent) expressly set out in a writing signed and delivered by
Lender. No notice to or demand on Borrower in any case shall entitle Borrower to any other notice
or demand in similar or other circumstances, nor shall such notice or demand constitute a waiver of
the rights of Lender to any other or further actions. In its sole discretion, Lender may, at any
time and from time to time, waive any one or more of the requirements contained herein, but such
waiver in any instance or under any particular circumstances shall not be considered a waiver of
such requirement or requirements in any other instance or under any other circumstance.

9.7 Sole and Absolute Discretion. Any option, consent, approval, discretion or
similar right of Lender set forth in this Note may be exercised by Lender in its sole, absolute and
unreviewable discretion, unless the provisions of this Note specifically require such option,
consent, approval, discretion or similar right to be exercised in Lender’s reasonable discretion.

IN WITNESS WHEREOF, the undersigned has duly executed and delivered this Note as of the date
first set forth above.

BORROWER:

Dover Saddlery, Inc.

By:     

Name:     

Title:     

Date:     

1

SCHEDULE A

PREPAYMENT FEE

As consideration for Lender’s making of the loan to Borrower upon the terms evidenced by this
Note, Borrower agrees to pay a prepayment fee (“Prepayment Fee”) to Lender as follows:

(a) if prepayment is made prior to the first (1st) anniversary of the
date of this Note, an amount equal to five percent (5%) of the amount prepaid;

(b) if prepayment is made on or after the first (1st) anniversary of the date of
this Note, but prior to the second (2nd) anniversary of date of this
Note, the prepayment fee shall be an amount equal to four percent (4%) of the amount
prepaid;

(c) if prepayment is made on or after the second (2nd) anniversary of the
date of this Note, but prior to the third (3rd) anniversary of the date
of this Note, the prepayment fee shall be an amount equal to three (3%) of the
amount prepaid;

(d) no prepayment premium shall be payable with respect to any prepayment made after
the third (3rd) anniversary of the date of this Note.

The Prepayment Fee shall be due and payable on the date when a voluntary prepayment of
principal is made or prepayment due to acceleration or default is made, unless the same is due to a
Change of Control as defined in the Loan Agreement. If Borrower commits to a prepayment plan in
installments, the Prepayment Fee shall be charged at the Prepayment Fee rate applicable to the date
of the first installment, notwithstanding occurrence of subsequent payments. Borrower acknowledges
that Lender would not otherwise be willing to make the loan evidenced by this Note upon the terms
set forth therein, but for Borrower’s covenant to pay the Prepayment Fee.

2

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