Document:

Exhibit 10(g) Amended and Restated Financing and Security Agreement, dated
      as of July 28, 2006

    AMENDED
      AND RESTATED

    FINANCING
      AND SECURITY AGREEMENT

     

     

    THIS
      FINANCING AND SECURITY AGREEMENT (this “Agreement”)
      is
      made as of July 28, 2006, by and among PAYMENTS INC., a corporation organized
      under the laws the State of New York (“Payments
      Inc.”),
      and
      DCAP GROUP, INC., a corporation organized and existing under the laws of the
      State of Delaware (“Parent”),
      of
      which Payments Inc. is a wholly-owned subsidiary, jointly and severally (the
      “Borrower”);
      MANUFACTURERS AND TRADERS TRUST COMPANY, a New York State Bank organized under
      the laws of the State of New York (“M&T”);
      and
      each other financial institution that is a party to this Agreement, whether
      by
      execution of this Agreement or otherwise (collectively, the “Lenders”
and
      individually, a “Lender”);
      and
      MANUFACTURERS AND TRADERS TRUST COMPANY, a New York State Bank, in its capacity
      as both collateral and administrative agent for each of the Lenders and sole
      arranger (the “Agent”).

     

    RECITALS

     

    A. Payments
      Inc., the Agent and M&T (as sole Lender) entered into a Financing and
      Security Agreement dated December 27, 2004 (the “Original Financing Agreement”).
      The Original Financing Agreement provides for some of the agreements between
      the
      Payments Inc. and the Lenders with respect to the “Credit Facilities” (as that
      term is defined in the Original Financing Agreement), including the Revolving
      Credit Facility (as that term is defined in the Original Financing Agreement)
      in
      an amount not to exceed $35,000,000.

     

    B. The
      Borrower has requested that the Lenders agree to provide a $2,500,000
      multiple-advance term loan facility to be used by the Borrower for the Permitted
      Uses described in this Agreement and guaranteed by the Guarantors (as that
      term
      is defined below) and to reduce the aggregate Commitments to
      $20,00,000.

     

    C. The
      Lenders are willing to make the recast credit facilities available to the
      Borrower upon the terms and subject to the conditions set forth in this
      Agreement.

     

    AGREEMENTS

     

    NOW,
      THEREFORE, in consideration of the premises and for other good and valuable
      consideration, the receipt of which is hereby acknowledged, the parties hereby
      agree as follows:

     

    ARTICLE
      I

    DEFINITIONS

     

    Section
      1.1  Certain
      Defined Terms.

     

    As
      used
      in this Agreement, the terms defined in the Preamble and Recitals hereto shall
      have the respective meanings specified therein, and the following terms shall
      have the following meanings:

     

     

    
      
        
        

      

      
        
        

        
        

      

      
        
        

      

    

    “Account
      Debtor”
means
      any Person who is obligated on a Receivable and “Account
      Debtors”
mean
      all Persons who are obligated on the Receivables.

     

    “ACH
      Settlement Risk Reserve”
means
      any and all Reserves that the Agent from time to time establishes, in its sole
      discretion, with respect to ACH Transactions.

     

    “ACH
      Transactions”
means
      any cash management or related services including the automatic clearing house
      transfer of funds by the Agent for the account of the Borrower pursuant to
      agreement or overdrafts.

     

    “Adjustment
      Date”
means,
      as applicable, the date on which a financial institution becomes a new Lender
      pursuant to the provisions of Section
      9.5
      (Remaining Syndication) or the date on which an assignment by an existing Lender
      is effective pursuant to the provisions of Section
      9.6
      (Assignments by Lenders).

     

    “Advances”
means
      the collective reference to each advance under the Revolving Loan including,
      without limitation, those under Section
      2.1.1
      (Revolving Credit Facility), Agent Advances, and Overadvances.

     

    “Affiliate”
means,
      with respect to any designated Person, any other Person, (a) directly or
      indirectly controlling, directly or indirectly controlled by, or under direct
      or
      indirect common control with the Person designated, (b) directly or indirectly
      owning or holding five percent (5%) or more of any equity interest in such
      designated Person, or (c) five percent (5%) or more of whose stock or other
      equity interest is directly or indirectly owned or held by such designated
      Person. For purposes of this definition, the term “control” (including with
      correlative meanings, the terms “controlling”, “controlled by” and “under common
      control with”) means the possession, directly or indirectly, of the power to
      direct or cause the direction of the management and policies of a Person,
      whether through ownership of voting securities or other equity interests or
      by
      contract or otherwise.

     

    “Agent”
means
      the Person defined as the “Agent”
in
      the
      preamble of this Agreement and shall also include any successor Agent appointed
      pursuant to Section
      8.9
      (Successor Agent).

     

    “Agent
      Advances”
has
      the
      meaning set forth in Section
      2.6.1
      (Agent
      Advances).

     

    “Agent’s
      Liens”
means
      the Liens in the Collateral granted to the Agent, for the benefit of the
      Lenders, M&T, and Agent pursuant to this Agreement and the other Financing
      Documents.

     

    “Agent-Related
      Persons”
means
      the Agent, together with its Affiliates, and the officers, directors, employees,
      counsel, representatives, agents and attorneys-in-fact of the Agent and such
      Affiliates.

     

    “Agent’s
      Obligations”
shall
      mean any and all Obligations payable solely to and for the exclusive benefit
      of
      the Agent or M&T (except in its capacity as a Lender) by the Borrower under
      the terms of this Agreement and/or any of the other Financing Documents,
      including, without limitation, indebtedness, liabilities and obligations with
      respect to Bank Products, the Arrangement Fee, and any and all Monitoring
      Fees.

     

     

    
      
        
        

      

      
        -2-

        
        

      

      
        
        

      

    

    “Agreement”
means
      this Amended and Restated Financing and Security Agreement (which amends and
      restates the Original Financing Agreement), as amended, restated, supplemented
      or otherwise modified in writing in accordance with the provisions of
Section
      9.2
      (Amendments; Waivers).

     

    “Aggregate
      Commitments”
means
      $20,000,000.

     

    “Applicable
      Interest Rate”
means
      (a) the LIBOR Rate, (b) the LIBOR Floating Rate, or (c) the Base
      Rate.

     

    “Applicable
      Margin”
means
      the applicable rate per annum added, as set forth in Section
      2.4.1
      (Applicable Interest Rates - Term Line) Section
       2.4.2
      (Applicable Interest Rates - Revolving Loan), to the LIBOR Base Rate, the LIBOR
      Index Rate or the Prime Rate.

     

    “Approved
      Acquisition” means an acquisition (by acquisition of assets, acquisition of
      stock, voting agreements, merger, other combination or other arrangements for
      control) by the Borrower or any of its Subsidiaries of any other business entity
      or all or a substantial portion of the assets of a Person, for which Acquisition
      the Borrower has obtained the Agent’s prior written consent, which
      consent shall not be unreasonably withheld or delayed.

     

    “Arranger”
means
      the Investment Banking Group of M&T.

     

    “Arrangement
      Fee”
has
      the
      meaning set forth in that certain letter agreement dated of even date herewith
      between the Agent and the Borrower.

     

    “Assignee”
means
      any Person to which any Lender assigns all or any portion of its interests
      under
      this Agreement, any Commitment, and any Loan, in accordance with the provisions
      of Section
      9.6
      (Assignments by Lenders), together with any and all successors and assigns
      of
      such Person; “Assignees”
means
      the collective reference to all Assignees.

     

    “Assignment
      of Life Insurance”
means
      that certain assignment of life insurance as collateral dated as of the Original
      Closing Date from the Borrower to the Agent for the benefit of the Lenders
      ratably and the Agent, which Assignment of Life Insurance assigns to the Agent
      for the benefit of the Lenders ratably and the Agent, all of the right, title
      and interest of the Borrower in, and to, that certain life insurance policy
      issued by Zurich Life Insurance of New York on the life of Barry B. Goldstein
      in
      the face amount of Four Million Dollars ($4,000,000) (which amount may be
      reduced to an amount not less than One Million Five Hundred Thousand Dollars
      ($1,500,000) if done so in accordance with this Agreement), as amended,
      restated, reissued, supplemented or otherwise modified in writing at any time
      and from time to time.

     

    “Back-Up
      Servicing Agreement”
means
      the collective reference to the Media Storage Agreement dated April 21, 2004
      between the Servicer and Media Storage and the IBM Business Recovery Services
      Contract Document dated September, 2003 between Servicer and IBM, and each
      other
      of the Borrower with a servicer (other than the Servicer) to provide
      substantially the same services provided by the Servicer under the Servicing
      Agreement in the event the Servicer does not provide such services, which
      agreement shall be subject to such other agreements (by way of example and
      not
      limitation, an agreement similar to the Servicing Agreement Assignment), and
      the
      servicer and all of the foregoing agreements being in form and substance
      satisfactory to the Agent in the exercise of its sole and absolute discretion
      from time to time. 

     

    
       

      
        
          
          

        

        
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    “Bank
      Products”
means
      any service or facility extended to the Borrower by M&T or any Affiliate of
      M&T including: (a) credit cards, (b) credit card processing services, (c)
      debit cards, (d) purchase cards, (e) ACH Transactions, (f) cash management,
      including controlled disbursement, accounts or services, or (g) Hedge
      Agreements.

     

    “Bankruptcy
      Code”
means
      Title 11 of the United States Code, as amended from time to time, and any
      successor Laws.

     

    “Base
      Rate”
means
      the Prime Rate plus the Applicable Margin.

     

    “Base
      Rate Loan”
means
      any Loan for which interest is to be computed with reference to the Base
      Rate.

     

    “Borrower”
means
      the collective reference to each and every Person defined as a “Borrower” in the
      preamble of this Agreement or otherwise so identified in this Agreement from
      time to time, and to any one or more of such Persons, all jointly and severally,
      unless a specific Borrower is expressly identified. “Borrowers” means the
      collective reference to all Persons included in the definition of
“Borrower.”

     

    “Borrowing
      Base”
has
      the
      meaning described in Section
      2.1.3(a)
      (Computation of Borrowing Base).

     

    “Borrowing
      Base Deficiency”
has
      the
      meaning described in Section
      2.1.3(d)
      (Computation of Borrowing Base).

     

    “Borrowing
      Base Report”
has
      the
      meaning described in Section
      2.1.5
      (Borrowing Base Report).

     

    “Business
      Day”
means
      any day other than a Saturday, Sunday or other day on which (a) in the case
      of
      M&T (as Agent and Lender), commercial banks in the State are authorized or
      required to close and, (b) in the case of the Lenders other than M&T, those
      Lenders are closed for the transaction of business at the addresses stated
      after
      their names on the signature pages of this Agreement.

     

    “Capital
      Adequacy Regulation”
means
      any guideline, request or directive of any central bank or other Governmental
      Authority, or any other law, rule or regulation, whether or not having the
      force
      of law, in each case, regarding capital adequacy of any bank or of any
      corporation controlling a bank.

     

    “Capital
      Expenditure”
means
      an expenditure (whether payable in cash or other property or accrued as a
      liability) for Fixed or Capital Assets, including, without limitation, the
      entering into of a Capital Lease.

     

    “Capitalization”
has
      the
      meaning set forth in Section
      6.1.15(a).

     

    
       

      
        
          
          

        

        
          -4-

          
          

        

        
          
          

        

      

    

    “Capitalization
      Ratio”
      has
      the
      meaning set forth in Section
      6.1.15(a).

     

    “Capital
      Lease”
means
      with respect to any Person any lease of real or personal property, for which
      the
      related Lease Obligations have been or should be, in accordance with GAAP
      consistently applied, capitalized on the balance sheet of that
      Person.

     

    “Cash
      Equivalents”
means
      (a) securities with maturities of one year or less from the date of acquisition
      issued or fully guaranteed or insured by the United States Government or any
      agency thereof, (b) certificates of deposit with maturities of one (1) year
      or
      less from the date of acquisition of, or money market accounts maintained with,
      the Agent, any Affiliate of the Agent, or any other domestic commercial bank
      having capital and surplus in excess of One Hundred Million Dollars
      ($100,000,000.00) or such other domestic financial institutions or domestic
      brokerage houses to the extent disclosed to, and approved by, the Agent and
      (c)
      commercial paper of a domestic issuer rated at least either A-1 by Standard
      & Poor’s Corporation (or its successor) or P-1 by Moody’s Investors Service,
      Inc. (or its successor) with maturities of six (6) months or less from the
      date
      of acquisition.

     

    “Closing
      Date”
means
      the date of this Agreement.

     

    “Collateral”
means
      all property of the Borrower subject from time to time to the Liens of this
      Agreement, any of the Security Documents and/or any of the other Financing
      Documents, together with any and all cash and non-cash proceeds and products
      thereof.

     

    “Collateral
      Account”
has
      the
      meaning described in Section
      2.1.10
      (Collateral Account).

     

    “Commitment”
means
      with respect to a Lender, the Lender’s Revolving Credit Commitment and the Term
      Line Commitment, as the case may be, and “Commitments”
means
      the collective reference to the Revolving Credit Commitment and the Term Line
      Commitment.

     

    “Committed
      Amount”
means
      with respect to a Lender, the Lender’s Revolving Credit Committed Amount or the
      Term Line Committed Amount, as the case may be, and “Committed
      Amounts”
means
      collectively the Revolving Credit Committed Amount and the Term Line Committed
      Amount.

     

    “Compliance
      Certificate”
means
      a
      periodic Compliance Certificate furnished by the Borrower in compliance
Section
      6.1.1(d)
      (Borrower Information) and in substantially the form attached to this Agreement
      as EXHIBIT C.

     

    “Copyrights”
means
      and includes, in each case whether now existing or hereafter arising, all of
      the
      Borrower’s rights, title and interest in and to (a) all copyrights, rights and
      interests in copyrights, works protectable by copyright, copyright
      registrations, copyright applications, and all renewals of any of the foregoing,
      (b) all income, royalties, damages and payments now or hereafter due and/or
      payable under any of the foregoing, including, without limitation, damages
      or
      payments for past, current or future infringements of any of the foregoing,
      (c)
      the right to sue for past, present and future infringements of any of the
      foregoing, and (d) all rights corresponding to any of the foregoing throughout
      the world.

    
       

      
        
          
          

        

        
          -5-

          
          

        

        
          
          

        

      

    

     

    “Corporate
      Guarantor”
means
      the Parent, and each of the direct and indirect wholly-owned Subsidiaries of
      the
      Parent, as the case may be and each of their respective successors and assigns,
      and “Corporate
      Guarantors”
means
      collectively the Parent, such subsidiaries and each of their respective
      successors and assigns.

     

    “Corporate
      Guaranties”
means
      the collective reference to each of those certain guaranties of payment for
      the
      benefit of the Lenders ratably and the Agent dated the date hereof to the Agent
      from the Corporate Guarantors, respectively, as the same may from time to time
      be amended, restated, supplemented or otherwise modified; and “Corporate
      Guaranty”
means
      each of the Corporate Guaranties. 

     

    “Credit
      Facility”
means
      the Revolving Credit Facility or the Term Line Facility, as the case may be,
      and
“Credit
      Facilities”
means
      collectively the Revolving Credit Facility, the Term Line Facility and any
      and
      all other credit facilities now or hereafter extended under or secured by this
      Agreement.

     

    “Default”
means
      an event that, with the giving of notice or lapse of time, or both, could or
      would constitute an Event of Default under the provisions of this
      Agreement.

     

    “Defaulting
      Lender”
means
      any Lender that fails to make any Advance (or other extension of credit) that
      it
      is required to make hereunder on the date that it is required to do so
      hereunder. 

     

    “Early
      Termination Fee”
has
      the
      meaning described in Section
      2.1.13
      (Early
      Termination Fee).

     

    “EBITDA”
has
      the
      meaning set forth in Section
      6.1.15(a).

     

    “Eligible
      Carrier”
shall
      mean a property and casualty insurance company which has an A. M. Best rating
      of
      not less than “B”
or
      Standard and Poor’s rating of not less than “BBBq”,
      or
      which is included in EXHIBIT E attached to and made a part of this Agreement,
      up
      to and including the aggregate amount of Receivables financing insurance
      policies of such insurance company as set forth in EXHIBIT E, all as acceptable
      to the Agent in the exercise of its sole and absolute discretion from time
      to
      time. 

     

     “Eligible
      Receivables”
shall
      mean shall mean any bona fide Receivable that is created by Payments Inc. in
      the
      ordinary course of its business
      and that
      satisfies and continues to satisfy, the following requirements:

     

    (a)  the
      Receivable was created pursuant to a Premium Finance Agreement that is in form
      and substance acceptable to the Agent, that reflects by its terms and in related
      payment coupon books and other materials, the Agent as secured creditor to
      Payments
      Inc.;

     

    (b)  the
      insurance carrier issuing the underlying insurance relating to the Receivable
      (i) is not a debtor in any case under any chapter of the Bankruptcy Code, is
      not
      insolvent, has not made an assignment for the benefit of creditors and is not
      the subject of any insolvency, liquidation, reorganization, dissolution,
      receivership, conservatorship, trusteeship or other such proceeding, and (ii)
      is
      an Eligible Carrier; provided, however, that in the case of a carrier for a
      non-commercial Premium Finance Agreement, a Receivable may be an Eligible
      Receivable even if the insurance carrier is not an Eligible Carrier provided
      that (A) such Receivable otherwise meets the criteria of an Eligible Receivable,
      and (B) the Premium Finance Agreements relating to insurance carriers who are
      not Eligible Carriers do not exceed an amount equal to twenty percent (20%)
      of
Payments
      Inc.’s
      Capitalization at any time;

     

    
       

      
        
          
          

        

        
          -6-

          
          

        

        
          
          

        

      

    

    (c)  the
      broker or agent of the underlying insurance relating to the Receivable is not
      a
      debtor in any case under any chapter of the Bankruptcy Code, is not insolvent,
      has not made an assignment for the benefit of creditors, and is not the subject
      of any insolvency, liquidation, reorganization, dissolution, receivership,
      conservatorship, trusteeship or other such proceeding;

     

    (d)  the
      Receivable does not relate to an insurance policy that is subject in the
      ordinary course to audit and adjustment;

     

    (e)  the
      underlying insurance relating to the Receivable is cancelable by Payments
      Inc.
      and its
      assignees at any time following a default by the insured and provides for the
      return of unearned premiums and commissions upon cancellation;

     

    (f)  the
      rights to the return of unearned premiums and commissions upon cancellation
      of
      the underlying insurance relating to the Receivable may be validly assigned
      to
Payments
      Inc.
      and to
      assignees of Payments
      Inc.;

     

    (g)  the
      amount of unearned premiums or commissions payable upon cancellation of the
      underlying insurance relating to the Receivable is calculable at all
      times;

     

    (h)  the
      Premium Finance Agreement giving rise to the Receivable at the time of execution
      was in compliance with, and was created, solicited and entered into in
      compliance with, all applicable laws, statutes, regulations, rules, orders,
      decrees or injunctions of any governmental body, including all applicable
      insurance and consumer laws and regulations;

     

    (i)  the
      Receivable, the related Premium Finance Agreement and the related underlying
      insurance are each valid, binding and enforceable against each party
      thereto;

     

    (j)  the
      Premium Finance Agreement giving rise to the Receivable is fully and properly
      completed and contains a valid, binding and enforceable assignment to
Payments
      Inc.
      of all
      unearned premiums and commissions payable upon cancellation of the related
      underlying insurance and such assignment grants Payments
      Inc.
      a
      perfected first-priority security interest in such unearned premiums and
      commissions without the necessity of filing any financing statement or of making
      any other filing or taking any other action;

    
       

      
        
          
          

        

        
          -7-

          
          

        

        
          
          

        

      

    

     

    (k)  the
      Premium Finance Agreement giving rise to the Receivable gives Payments
      Inc.
      and its
      assignees a power of attorney or other legal authority that enables Payments
      Inc.
      and its
      assignees to cancel the underlying insurance;

     

    (l)  the
      Premium Finance Agreement giving rise to the Receivable is in the possession
      of
Payments
      Inc.;

     

    (m)  the
      Receivable is in compliance with all representations and warranties made with
      respect thereto in this Agreement, including all representations and warranties
      made by Payments
      Inc.
      with
      respect to the Premium Finance Agreement giving rise to the Receivable and
      with
      respect to the underlying insurance relating to the Receivable;

     

    (n)  if
      the
      related underlying insurance is canceled, cancellation was made before any
      payment on the Receivable became more than forty-five (45) days past
      due;

     

    (o)  for
      a
      non-commercial Premium Finance Agreement, if the underlying insurance has been
      canceled, not more than 90 days have elapsed since the date of cancellation;
      

     

    (p)  for
      a
      commercial Premium Finance Agreement, if the underlying insurance has been
      canceled, not more than 120 days have elapsed since the date of
      cancellation

     

    (q)  for
      a
      commercial Premium Finance Agreement with a policy premium in excess of $75,000,
      the Agent shall have expressly approved inclusion of the applicable Receivables
      among the Eligible Receivables; 

     

    (r)  if
      the
      underlying insurance has been canceled, the unearned premiums and commissions
      have not been paid;

     

    (s)  except
      for security interests securing the Obligations and security interests in favor
      of Payments
      Inc.,
      the
      Receivable is not subject to any lien or security interest;

     

    (t)  the
      Receivable has been entered into and tracked by a premium finance software
      system acceptable to the Agent; 

     

    (u)  the
      Receivable relates to a premium for which the payee on the check or draft used
      to pay the premium is either: (i) the insurance carrier on the policy securing
      the Premium Finance Agreement, (ii) the New York Automobile Insurance Plan
      (NYAIP), New Jersey Personal Automobile Insurance Plan (NJPAIP) or the
      Pennsylvania Automobile Insurance Plan (PAIP); (iii) a Managing General Agent
      or
      General Agent, duly authorized to receive payments on behalf of the carrier
      on
      the underlying policy of insurance, or (iv) an insurance agent or broker for
      whom Payments
      Inc.
      has
      completed due diligence in form and with results satisfactory to the Agent,
      all
      of clauses (i) through (iv) based on documentation on file with and satisfactory
      to the Agent, provided, however, that the Agent in the exercise of its sole
      and
      absolute discretion from time to time may approve additional or other State
      plans or payment arrangements;

     

    
       

      
        
          
          

        

        
          -8-

          
          

        

        
          
          

        

      

    

    (v)  the
      Receivable arises under either (i) a Premium Finance Agreement under which
      the
      underlying insured is domiciled in the State of New York; or (ii) a Premium
      Finance Agreement under which the underlying insured is domiciled in the State
      of New Jersey or the Commonwealth of Pennsylvania provided, that no such
      Receivables from such State shall be included among Eligible Receivables unless
      the Agent shall have received an opinion of counsel that Payments
      Inc.
      has the
      necessary Premium Finance Licenses for such State; and provided, further, that
      the Agent in the exercise of its sole and absolute discretion from time to
      time
      may approve Premium Finance Agreement relating to insureds in additional
      States;

     

    (w)  for
      a
      non-commercial Premium Finance Agreement, the Receivable arises under a Premium
      Finance Agreement under which the underlying carrier participates in the NYAIP,
      NJPAIP and/or PAIP. 

     

    The
      Agent
      may determine from time to time, in its sole and absolute discretion and
      notwithstanding any previous determinations made by it or the preceding
      criteria, to exclude from Eligible Receivables specific Receivables or specific
      categories or types of Receivables, specific components of Receivables,
      Receivables with respect to which the related underlying insurance is issued
      by
      a specific issuer or by specific categories or types of issuers, Receivables
      arising out of specific Premium Finance Agreements or specific categories or
      types of Premium Finance Agreements, Receivables with respect to which the
      related underlying insurance was produced by a specific agent, broker or other
      producer or by specific categories or types of agents, brokers or other
      producers, or otherwise to limit Receivables, or the amount of Receivables,
      which shall constitute Eligible Receivables. Such determinations may be based
      upon evaluations of risk or any other factors considered relevant by the Agent,
      whether such factors have or have not heretofore been used, contemplated or
      foreseen as bases for defining or limiting Eligible Receivables. Any such
      determination by the Agent to modify Eligible Receivables will be promptly
      communicated to the Borrower in writing. In order to enable the Agent to make
      such determinations, the Borrower agrees to furnish, or cause to be furnished,
      to the Agent from time to time such information and documentation that has
      been
      requested and is reasonably available concerning Receivables, Premium Finance
      Agreements, underlying insurance, issuers of underlying insurance, agents,
      brokers and other producers of underlying insurance, premium down payments
      made
      by insureds with respect to underlying insurance and other matters as the Agent
      may from time to time request. Without implying any limitation on the foregoing,
      the Borrower may propose that the Agent consider from time to time the inclusion
      of Receivables from commercial Account Debtors among Eligible Receivables,
      which
      the Agent may from time to time agree or decline to do from time to time in
      the
      exercise of its sole and absolute discretion.

    
       

      
        
          
          

        

        
          -9-

          
          

        

        
          
          

        

      

    

     

    “Enforcement
      Costs”
means
      all expenses, charges, costs and fees whatsoever (including, without limitation,
      reasonable outside and allocated in-house counsel attorney’s fees and expenses)
      of any nature whatsoever paid or incurred by or on behalf of the Agent and/or
      any of the Lenders (whether arising before or after the commencement of any
      proceedings under the United States Bankruptcy Code or other applicable laws
      related to insolvency or otherwise and whether or now allowed or allowable
      as a
      claim in any such proceeding) in connection with (a) any or all of the
      Obligations, this Agreement and/or any of the other Financing Documents, (b)
      the
      creation, perfection, collection, maintenance, preservation, defense,
      protection, realization upon, disposition, sale or enforcement of all or any
      part of the Collateral, this Agreement or any of the other Financing Documents,
      including, without limitation, those costs and expenses more specifically
      enumerated in Section
      3.7
      (Costs)
      and/or Section
      9.11
      (Enforcement Costs), and further including, without limitation, amounts paid
      to
      lessors, processors, bailees, warehousemen, sureties, judgment creditors and
      others in possession of or with a Lien against or claimed against the
      Collateral, and (c) the monitoring, administration, processing and/or servicing
      of any or all of the Obligations, the Financing Documents, and/or the
      Collateral.

     

    “Equipment”
means
      all equipment, machinery, computers, chattels, tools, parts, machine tools,
      furniture, furnishings, fixtures and goods (other than inventory) of every
      nature (including, without limitation, embedded software), presently existing
      or
      hereafter acquired or created and wherever located, whether or not the same
      shall be deemed to be affixed to real property, and all of such types of
      property leased by the Borrower and all of the Borrower’s rights and interests
      with respect thereto under such leases (including, without limitation, options
      to purchase), together with all accessions, additions, fittings, accessories,
      special tools, and improvements thereto and substitutions therefor and all
      parts
      and equipment that may be attached to or that are necessary or beneficial for
      the operation, use and/or disposition of such personal property, all licenses,
      warranties, franchises and General Intangibles related thereto or necessary
      or
      beneficial for the operation, use and/or disposition of the same, together
      with
      all Receivables, chattel paper, instruments and other consideration received
      by
      the Borrower on account of the sale, lease or other disposition of all or any
      part of the foregoing, and together with all rights under or arising out of
      present or future documents and contracts relating to the foregoing and all
      proceeds (cash proceeds and noncash proceeds) of the foregoing.

     

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

     

    “ERISA
      Affiliate”
means
      any Person that is a member of the Borrower’s controlled group, or under common
      control with the Borrower, within the meaning of Section 414 of the Internal
      Revenue Code.

     

    “Event
      of Default”
has
      the
      meaning described in ARTICLE
      VII
      (Default
      and Rights and Remedies).

     

    “Excess
      Availability”
means,
      as of any time of determination, (a) the lesser of the Total Revolving Credit
      Committed Amount or the Borrowing Base (after giving effect to provisions for
      Reserves and other adjustments permitted by this Agreement) minus
      (b) the
      aggregate Revolver Usage.

     

    
       

      
        
          
          

        

        
          -10-

          
          

        

        
          
          

        

      

    

    “Facilities”
means
      the collective reference to the loan, letter of credit, interest rate
      protection, foreign exchange risk, cash management, and other credit facilities
      now or hereafter provided to the Borrower by the Agent or the Lenders under
      this
      Agreement or otherwise by M&T.

     

    “Federal
      Funds Rate”
means
      for any day of determination, the weighted average of the rates on overnight
      federal funds transactions with members of the Federal Reserve System arranged
      by federal funds brokers, as published for such day (or, if such day is not
      a
      Business Day) by the Federal Reserve Bank for the immediately preceding Business
      Day) by the Federal Reserve Bank of Richmond or, if such rate is not so
      published for any day that is a Business Day, the average of quotations for
      such
      day on such transactions received by the Agent from three (3) federal funds
      brokers of recognized standing selected by the Agent.

     

    “Fees”
means
      the collective reference to each fee payable to the Agent, for its own account
      or for the ratable benefit of the Lenders, under the terms of this Agreement
      or
      under the terms of any of the other Financing Documents, including, without
      limitation, the Revolving Credit Unused Line Fees, the Early Termination Fee,
      the Arrangement Fee and the Monitoring Fees.

     

    
      “Financing
        Documents” means at any time collectively
        this Agreement, the Notes, the Security
        Documents, the Wind Down Guaranty, the
        Corporate Guaranties, any Hedge Agreement,
        agreements with respect to Bank Products, and
        any
        other instrument, agreement
        or document previously, simultaneously or hereafter executed
        and delivered by
        the
        Borrower, any Guarantor and/or any other Person, singly
        or
        jointly with another Person
        or
        Persons, evidencing, securing, guarantying or in connection with
        this
Agreement,
        any Note, any of the Security Documents, any of the Facilities, and/or
        any of the
        Obligations.

    

     

    “Fiscal
      Year”
means
      as to the Borrower a fiscal year ending December 31.

     

    “Fixed
      or Capital Assets”
of
      a
      Person at any date means all assets that would, in accordance with GAAP
      consistently applied, be classified on the balance sheet of such Person as
      property, plant or equipment at such date.

     

    “Floating
      Rate Loan”
means
      any Loan for which interest is to be computed with reference to the either
      the
      Base Rate or the LIBOR Floating Rate.

     

    “Funded
      Debt” has the meaning set forth in Section
      6.1.15(a).

     

    “GAAP”
means
      generally accepted accounting principles in the United States of America in
      effect from time to time.

     

    “General
      Intangibles”
means
      all general intangibles of every nature, whether presently existing or hereafter
      acquired or created, and without implying any limitation of the foregoing,
      further means all books and records, commercial tort claims, other claims
      (including without limitation all claims for income tax and other refunds),
      payment intangibles, Supporting Obligations, choses in action, causes of action
      in tort or equity, contract rights, judgments, customer lists, software,
      Patents, Trademarks, licensing agreements, rights in intellectual property,
      goodwill (including goodwill of the Borrower’s business symbolized by and
      associated with any and all trademarks, trademark licenses, Copyrights and/or
      service marks), royalty payments, licenses, letter-of-credit rights, letters
      of
      credit, contractual rights, the right to receive refunds of unearned insurance
      premiums, rights as lessee under any lease of real or personal property,
      literary rights, Copyrights, service names, service marks, logos, trade secrets,
      amounts received as an award in or settlement of a suit in damages, deposit
      accounts, interests in joint ventures, general or limited partnerships, or
      limited liability companies or partnerships, rights in applications for any
      of
      the foregoing, books and records in whatever media (paper, electronic or
      otherwise) recorded or stored with respect to any or all of the foregoing,
      all
      Supporting Obligations with respect to any of the foregoing, and all equipment
      and general intangibles necessary or beneficial to retain, access and/or process
      the information contained in those books and records, and all proceeds (cash
      proceeds and noncash proceeds) of the foregoing.

    
       

      
        
          
          

        

        
          -11-

          
          

        

        
          
          

        

      

    

     

    “Governmental
      Authority”
means
      any nation or government, any state or other political subdivision thereof
      and
      any entity exercising executive, legislative, judicial, regulatory or
      administrative functions of or pertaining to government and any department,
      agency or instrumentality thereof.

     

    “Guarantor”
means
      a
      Wind Down Guarantor or a Corporate Guarantor, as the case may be, and
“Guarantors”
means
      the Wind Down Guarantor and all Corporate Guarantors.

     

    “Guarantor
      Security Agreements”
means
      the collective reference to those certain Security Agreements dated as of the
      date of this Agreement executed by each of the respective Corporate Guarantors
      in favor of the Agent for itself and the ratable benefit of the Lenders, each
      as
amended,
      restated, modified, substituted, extended and renewed from time to
      time. 

     

    “Guaranty”
means
      the Wind Down Guaranty or the Corporate Guaranties, as the case may be, and
      “Guaranties” means the Wind Down Guaranty and the Corporate Guaranties.

     

    “Hazardous
      Materials”
means
      (a) any “hazardous
      waste”
as
      defined by the Resource Conservation and Recovery Act of 1976, as amended from
      time to time, and regulations promulgated thereunder; (b) any “hazardous
      substance” as defined by the Comprehensive Environmental Response, Compensation
      and Liability Act of 1980, as amended from time to time, and regulations
      promulgated thereunder; (c) any substance the presence of which on any property
      now or hereafter owned, acquired or operated by the Borrower is prohibited
      by
      any Law similar to those set forth in this definition; and (d) any other
      substance that by Law requires special handling in its collection, storage,
      treatment or disposal.

     

    “Hazardous
      Materials Contamination”
means
      the contamination (whether presently existing or occurring after the date of
      this Agreement) by Hazardous Materials of any property owned, operated or
      controlled by the Borrower or for which the Borrower has responsibility,
      including, without limitation, improvements, facilities, soil, ground water,
      air
      or other elements on, or of, any property now or hereafter owned, acquired
      or
      operated by the Borrower, and any other contamination by Hazardous Materials
      for
      which the Borrower is, or is claimed to be, responsible.

     

    “Hedge
      Agreement”
means
      any and all transactions, agreements or documents now existing or hereafter
      entered into, that provides for an interest rate, credit, commodity or equity
      swap, cap, floor, collar, forward foreign exchange transaction, currency swap,
      cross currency rate swap, currency option, or any combination of, or option
      with
      respect to, these or similar transactions, for the purpose of hedging the
      Borrower’s exposure to fluctuations in interest or exchange rates, loan, credit
      exchange, security or currency valuations or commodity prices.

     

    
       

      
        
          
          

        

        
          -12-

          
          

        

        
          
          

        

      

    

    “Hedge
      Reserve”
means
      any and all Reserves that the Agent from time to time establishes, in its sole
      discretion, with respect to Hedge Agreement Transactions.

     

    “Hedge
      Transactions”
means
      the collection reference to transactions contemplated by Hedge
      Agreements.

     

    “Indebtedness
      for Borrowed Money”
of
      a
      Person means at any time the sum at such time of (a) indebtedness of such Person
      for borrowed money or for the deferred purchase price of property or services,
      (b) any obligations of such Person in respect of letters of credit, banker’s or
      other acceptances or similar obligations issued or created for the account
      of
      such Person, (c) Lease Obligations of such Person with respect to Capital
      Leases, (d) all liabilities secured by any Lien on any property owned by such
      Person, to the extent attached to such Person’s interest in such property, even
      though such Person has not assumed or become personally liable for the payment
      thereof, (e) obligations of third parties that are being guarantied or
      indemnified against by such Person or that are secured by the property of such
      Person; (f) any obligation of such Person under or with respect to an employee
      stock ownership plan or other similar employee benefit plan; (g) any obligation
      of such Person or a ERISA Affiliate to a Multi-employer Plan; and (h) any
      obligations, liabilities or indebtedness, contingent or otherwise, under or
      in
      connection with, any Hedge Transactions; but excluding trade and other accounts
      payable in the ordinary course of business in accordance with customary trade
      terms and that are not overdue (as determined in accordance with customary
      trade
      practices) or that are being disputed in good faith by such Person and for
      which
      adequate reserves are being provided on the books of such Person in accordance
      with GAAP.

     

    “Indemnified
      Liabilities”
has
      the
      meaning set forth in Section
      9.19
      (Indemnification).

     

    “Indemnified
      Parties”
has
      the
      meaning set forth in Section
      9.19
      (Indemnification).

     

    “Interest
      Payment Date”
means
      with respect to the Revolving Loan, the first day of each calendar month
      commencing on August 1, 2006 and continuing thereafter until the Obligations
      have been irrevocably paid in full.

     

    “Interest
      Period”
means
      as to any LIBOR Loan, the period commencing on and including the date such
      LIBOR
      Loan is made (or on the effective date of the Borrower’s election to convert any
Floating
      Rate
      Loan to
      a LIBOR Loan in accordance with the provisions of this Agreement) and ending
      on
      and including the day which is one month, two months, three or six months
      thereafter, as selected by the Borrower in accordance with the provisions of
      this Agreement, and thereafter, each period commencing on the last day of then
      preceding Interest Period for such LIBOR Loan and ending on and including the
      day which is one month, two months, three months or six months thereafter,
      as
      selected by the Borrower in accordance with the provisions of this Agreement;
      provided, however that:

     

    
       

      
        
          
          

        

        
          -13-

          
          

        

        
          
          

        

      

    

    (a) the
      first
      day of any Interest Period shall be a LIBOR Business Day;

     

    (b) if
      any
      Interest Period would end on a day that shall not be a LIBOR Business Day,
      such
      Interest Period shall be extended to the next succeeding LIBOR Business Day
      unless such next succeeding LIBOR Business Day would fall in the next calendar
      month, in which case, such Interest Period shall end on the next preceding
      LIBOR
      Business Day; and

     

    (c) no
      Interest Period shall extend beyond the Revolving Credit Expiration
      Date.

     

    “Interest
      Rate Election Notice”
has
      the
      meaning described in Section
      2.4.3(e).

     

    “Internal
      Revenue Code”
means
      the Internal Revenue Code of 1986, as amended from time to time, and the Income
      Tax Regulations issued and proposed to be issued thereunder.

     

    “Item
      of Payment”
means
      each check, draft, cash, money, instrument, item, wire transfer, ACH transfer,
      other electronic transfer and other remittance, in any form or method
      whatsoever, in payment or on account of payment of the Receivables or otherwise
      with respect to any Collateral, including, without limitation, cash proceeds
      and
      other proceeds of Collateral; and “Items
      of Payment”
means
      the collective reference to all of the foregoing.

     

    “Laws”
means
      all ordinances, statutes, rules, regulations, orders, injunctions, writs, or
      decrees of any Governmental Authority.

     

    “M&T
      Loan”
means
      an Advance made by M&T in accordance with the provisions of Section
      2.6.2
      (M&T
      Advances).

     

    “Lease
      Obligations”
of
      a
      Person means for any period the rental commitments of such Person for such
      period under leases for real and/or personal property (net of rent from
      subleases thereof, but including taxes, insurance, maintenance and similar
      expenses that such Person, as the lessee, is obligated to pay under the terms
      of
      said leases, except to the extent that such taxes, insurance, maintenance and
      similar expenses are payable by sublessees), including rental commitments under
      Capital Leases.

     

    “LIBOR
      Base Rate”
means
      for any Interest Period with respect to any LIBOR Loan, the per annum interest
      rate rounded upward, if necessary, to the nearest 1/100 of 1%, appearing
      on Page 3750 (or any successor page) on the Dow
      Jones
      Markets Screen
      as the
      London interbank offered rate for deposits in Dollars at
      or
      about 11:00 a.m. (London time) on the date that is two (2) LIBOR Business Days
      prior to the first day of such Interest Period
      for a
      term comparable to such Interest Period. If for any reason such rate is not
      available, the term “LIBOR
      Base Rate”
shall
      mean, for any LIBOR Loan for any Interest Period therefor, the rate per annum
      (rounded upwards, if necessary, to the nearest 1/100 of 1%) determined by the
      Agent from time to time to be an equivalent rate.

     

    
      “LIBOR
        Business Day”
means
        any Business Day on which dealings in United States Dollar deposits are carried
        out on the London interbank market and on which commercial banks are open
        for
        domestic and international business (including dealings in Dollar deposits)
        in
        London, England.

    

    
       

      
        
          
          

        

        
          -14-

          
          

        

        
          
          

        

      

    

     

     

    “LIBOR
      Floating Index”
means
      a
      per annum rate of interest equal to the rate obtained by dividing
      (i) 
      the one
      month interest period London Interbank Offered Rate, fixed by the British
      Bankers Association for United States dollar deposits in the London Interbank
      Eurodollar Market at approximately 11:00 a.m. London, England time (or as soon
      thereafter as practicable) each day (or if such day is a non-Business Day,
      as
      fixed in the same manner on the immediately preceding Business Day, which day’s
      rate shall apply to the immediately succeeding non-Business Days), as determined
      by the Lender
      from any
      broker, quoting service or commonly available source utilized by the
Lender
      by
      (ii) 
      a
      percentage equal to 100% minus the stated maximum rate of all reserves required
      to be maintained against “Eurocurrency Liabilities” as specified in Regulation D
      (or against any other category of liabilities which includes deposits by
      reference to which the interest rate on LIBOR Rate loans is determined or any
      category of extensions of credit or other assets which includes loans by a
      non-United States’ office of a bank to United States residents) on such date to
      any member bank of the Federal Reserve System.

     

    “LIBOR
      Floating Rate”
means
      the sum of (a) the Applicable Margin for the LIBOR Floating Rate Loan
plus
      (b) the
      LIBOR Floating Index.

     

    “LIBOR
      Floating Rate Loan”
means
      any Loan for which interest is to be computed with reference to the LIBOR
      Floating Rate.

     

    “LIBOR
      Loan”
means
      any Loan for which interest is to be computed with reference to the LIBOR
      Rate.

     

    “LIBOR
      Rate”
means
      for any Interest Period with respect to any LIBOR Loan, (a) the Applicable
      Margin, plus
      (b) the
      per annum rate of interest calculated pursuant to the following
      formula:

     

    _____LIBOR
      Base Rate

    1.00
      -
      Reserve Percentage

     

    “Lien”
means
      any mortgage, deed of trust, deed to secure debt, grant, pledge, security
      interest, assignment, encumbrance, judgment, lien, financing statement,
      hypothecation, provision in any instrument or other document for confession
      of
      judgment, cognovit or other similar right or other remedy, claim, charge,
      control over or interest of any kind in real or personal property securing
      any
      indebtedness, duties, obligations, and liabilities owed to, or a claimed to
      be
      owed to, a Person, all whether perfected or unperfected, avoidable or
      unavoidable, based on the common law, statute or contract or otherwise,
      including, without limitation, any conditional sale or other title retention
      agreement, any lease in the nature thereof, and the filing of or agreement
      to
      give any financing statement under the Uniform Commercial Code of any
      jurisdiction, excluding the precautionary filing of any financing statement
      by
      any lessor in a true lease transaction or by any bailor in a true bailment
      transaction under the Uniform Commercial Code of any jurisdiction or the
      agreement to give any financing statement by any lessee in a true lease
      transaction or by any bailee in a true bailment transaction.

     

    
       

      
        
          
          

        

        
          -15-

          
          

        

        
          
          

        

      

    

    “Loan”
means
      the Revolving Loan or the Term Line, as the case may be, and “Loans”
means
      the collective reference to the Revolving Loan and the Term Line.

     

    “Loan
      Notice”
has
      the
      meaning described in Section
      2.1.2
      (Procedure for Making Advances).

     

    “Lockbox”
has
      the
      meaning described in Section
      2.1.10
      (Collateral Account).

     

    “Material
      Adverse Effect”
means
      with respect to the applicable Person an effect, either in any case or in the
      aggregate, which might result in a material adverse change (w) in the business,
      prospects, condition, affairs or operations of that Person, (x) to that Person’s
      material properties or assets, (y) in the right or ability of that Person to
      carry on a substantial portion of its operations as now conducted or proposed
      to
      be conducted or to perform its obligations under the Financing Documents, or
      (z)
      to the value of, or the ability of the Agent or the Lenders to realize upon,
      the
      Collateral.

     

    “Maximum
      Rate”
has
      the
      meaning described in Section
      2.3.5
      (Maximum
      Interest Rate).

     

    “Monitoring
      Fees”
has
      the
      meaning described in Section
      2.3.3
      (Monitoring Fees).

     

    “Multi-employer
      Plan”
means
      a
      Plan that is a Multi-employer plan as defined in Section 4001(a)(3) of
      ERISA.

     

    “Net
      Worth”
has
      the
      meaning set forth in Section
      6.1.15(a).

     

    “Note”
means
      the Revolving Credit Note or a Term Line Note, as the case may be, and “Notes”
means collectively the Revolving Credit Note and each Term Line Note, and any
      other promissory note which may from time to time evidence all or any portion
      of
      the Obligations.

     

    “Obligations”
means
      (a) all present and future indebtedness, duties, obligations, and liabilities,
      whether now existing or contemplated or hereafter arising, of the Borrower
      to
      the Lenders and/or Agent under, arising pursuant to, in connection with and/or
      on account of the provisions of this Agreement, each Note, each Security
      Document, and/or any of the other Financing Documents, the Loans, and/or any
      of
      the Facilities including, without limitation, the principal of, and interest
      on,
      each Note, late charges, the Fees, Enforcement Costs, and prepayment fees (if
      any), letter of credit reimbursement obligations, letter of credit fees or
      fees
      charged with respect to any guaranty of any letter of credit; (b) all other
      present and future indebtedness, duties, obligations, and liabilities, whether
      now existing or contemplated or hereafter arising, of the Borrower to the Agent
      and/or to M&T or its Affiliates of any nature whatsoever including, without
      limitation, any indebtedness, duties, obligations, and liabilities, under or
      in
      connection with, any Bank Products; regardless of whether any or all of the
      foregoing indebtedness, duties, obligations, and liabilities are direct,
      indirect, primary, secondary, joint, several, joint and several, fixed or
      contingent; and (c) any and all renewals, extensions, substitutions, amendments,
      restatements and rearrangements of any or all of the foregoing indebtedness,
      duties, obligations, and liabilities.

     

    “Original
      Closing Date” means December 27, 2004.

    
       

      
        
          
          

        

        
          -16-

          
          

        

        
          
          

        

      

    

     

    “Overadvance”
means,
      as of any date of determination, the amount, if any, by which the Revolver
      Usage
      exceeds the Borrowing Base.

     

    “Parent”
has
      the
      meaning set forth in the preamble to this Agreement.

     

    “Parent
      Subordinated Debt”
means
      that certain Indebtedness for Borrowed Money of the Parent in favor of the
      Parent Subordinated Note Purchasers in an original, aggregate face principal
      amount of Three Million Five Hundred Thousand Dollars ($3,500,000).

     

    “Parent
      Subordinated Debt Documents”
means
      any and all promissory notes, agreements, documents or instruments now or at
      any
      time evidencing, securing, guarantying or otherwise executed and delivered
      in
      connection with the Subordinated Debt, as the same may from time to time be
      amended, restated, supplemented or modified.

     

    “Parent
      Subordinated Note Purchasers”
means,
      collectively, (a) IRA FBO Stewart R. Spector, Pershing LLC Custodian, (b) IRA
      FBO Jack D. Seibald, Pershing LLC Custodian, (c) Sanders Opportunity Fund,
      (d)
      J.M.J Realty Company, (e) Take-Two Capital LP, (f) Michael Rosen and Catherine
      Rosen, (g) Andrew Tarica and (h) Citco Trustees (B.V.I) Limited as Trustee
      of
      the MS Deferred Income Trust.

     

    “Parent
      Subordination Agreements”
means
      the collective reference to (a) that certain subordination agreement by and
      between the Parent and the Parent Subordinated Note Purchasers in favor of
      the
      Agent for the benefit of the Lenders ratably and the Agent, and (b) that certain
      subordination agreement by and between the Borrower and the Parent Subordinated
      Note Purchasers in favor of the Agent for the benefit of the Lenders ratably
      and
      the Agent, as the same may be from time to time amended, restated, supplemented
      or modified.

     

    “Patents”
means
      and includes, in each case whether now existing or hereafter arising, all of
      the
      Borrower’s rights, title and interest in and to (a) any and all patents and
      patent applications, (b) any and all inventions and improvements described
      and
      claimed in such patents and patent applications, (c) reissues, divisions,
      continuations, renewals, extensions and continuations-in-part of any patents
      and
      patent applications, (d) income, royalties, damages, claims and payments now
      or
      hereafter due and/or payable under and with respect to any patents or patent
      applications, including, without limitation, damages and payments for past
      and
      future infringements, (e) rights to sue for past, present and future
      infringements of patents, and (f) all rights corresponding to any of the
      foregoing throughout the world.

     

    “Payments
      Inc.”
has
      the
      meaning set forth in the preamble to this Agreement.

     

    “PBGC”
means
      the Pension Benefit Guaranty Corporation.

     

    “Perfection
      Certificate”
has
      the
      meaning described in Section
      3.3
      (Perfection Certificate).

     

    “Permitted
      Distributions”
means
      an optional principal prepayment on the Parent Subordinated Debt, but such
      prepayment and such distribution may only be made if at the time thereof (i)
      there exists no Event of Default, (ii) after giving effect to the prepayment
      and
      distribution on a proforma basis and to the payment of the Borrower’s other
      indebtedness, liabilities and obligations then due in the ordinary course,
      the
      Borrower has Excess Availability of more than $1,000,000. 

    
       

      
        
          
          

        

        
          -17-

          
          

        

        
          
          

        

      

    

     

    “Permitted
      Liens”
means:
      (a) Liens for Taxes that are not delinquent or that the Agent has determined
      in
      the exercise of its sole and absolute discretion (i) are being diligently
      contested in good faith and by appropriate proceedings, and such contest
      operates to suspend collection of the contested Taxes and enforcement of a
      Lien,
      (ii) the Borrower has the financial ability to pay, with all penalties and
      interest, at all times without materially and adversely affecting the Borrower,
      and (iii) are not, and will not be with appropriate filing, the giving of notice
      and/or the passage of time, entitled to priority over any Lien of Agent and/or
      the Lenders; (b) deposits or pledges to secure obligations under workers’
compensation, social security or similar laws, or under unemployment insurance
      in the ordinary course of business; (c) Liens securing the Obligations; (d)
      judgment Liens to the extent the entry of such judgment does not constitute
      a
      Default or an Event of Default under the terms of this Agreement or result
      in
      the sale or levy of, or execution on, any of the Collateral; (e) purchase money
      security interests securing Indebtedness for Borrowed Money for the purchase
      of
      Equipment in arms-length, commercially reasonable transactions with Persons
      who
      are not Affiliates; provided, however, that (i) the indebtedness secured shall
      not exceed the unpaid purchase price of the Equipment acquired, plus reasonable
      finance charges and the reasonable costs of collection (including, without
      limitation, reasonable attorneys fees); (ii) each item of Equipment shall secure
      only its portion of the indebtedness described in item (i); and (iii) the amount
      of such indebtedness incurred shall not exceed $50,000 in the aggregate; (f)
      purchase money security interests expressly approved by the Lender and securing
      Indebtedness for Borrowed Money for the purchase pursuant to an Approved
      Acquisition; and (g) such other Liens, if any, as are set forth on Schedule
      4.1.22
      (Perfection and Priority of Collateral) attached hereto and made a part hereof.
      

     

    “Permitted
      Uses” means the financing of Premium Finance Receivables and providing liquidity
      for ongoing working capital purposes, including, without limitation, the
      repayment of indebtedness to Eagle *. 

     

    “Person”
means
      and includes an individual, a corporation, a partnership, a joint venture,
      a
      limited liability company or partnership, a trust, an unincorporated
      association, a Governmental Authority, or any other organization or
      entity.

     

    “Plan”
means
      any pension plan that is covered by Title IV of ERISA and in respect of which
      the Borrower or a ERISA Affiliate is an “employer”
as
      defined in Section 3 of ERISA.

     

    “Post-Default
      Rate”
means
      the Prime Rate in effect from time to time, plus three and one-half percent
      (3.5%) per annum.

     

    “Premium
      Claim Notices”
has
      the
      meaning set forth in Section
      6.1.29
      (Borrower’s Procedures).

     

    “Premium
      Finance Agreement”
shall
      mean any written agreement signed by an insured or prospective insured or,
      if
      permitted under applicable state law, signed by the agent or broker or another
      authorized person for such insured or such prospective insured by which the
      insured or prospective insured promises or agrees to pay to Borrower an amount
      advanced or to be advanced under the agreement by Borrower on behalf of the
      insured or prospective insured to an insurer, agent or broker in payment of
      premiums on insurance contracts and which contains an assignment of, or is
      otherwise secured by, the unearned premium or refund obtainable from the
      insurer, agent, broker or other parties upon cancellation of the insurance
      contract, and is otherwise substantially in the form attached hereto as EXHIBIT
      F, subject to required change under applicable Laws.

     

    
       

      
        
          
          

        

        
          -18-

          
          

        

        
          
          

        

      

    

    “Premium
      Finance Licenses”
shall
      mean any and all franchises, licenses, rights, permits, authorizations, consents
      ordinances, registrations, certificates, agreements, or other rights filed
      (or
      entered into) with, or granted (or otherwise issued) by, the federal government
      or any state or local governmental authority (whether pursuant to any franchise,
      ordinance, license, other agreement, or otherwise), pursuant to which the
      Borrower has the right to engage in the business of providing personal
      automobile insurance premium finance services; including, without limitation,
      the Borrower’s existing licenses issued by the State of New York and State of
      New Jersey. 

     

    “Premium
      Related Liabilities”
shall
      mean, at any time, the aggregate amount of the Borrower’s liabilities created
      pursuant to the financing of insurance premiums, excluding any indebtedness
      for
      credit extended to the Borrower relating to the financing of such insurance
      premiums, but including (a) amounts due to insurance carriers, insureds, agents
      and brokers (including an estimated amount with respect to outstanding checks
      payable to such Persons), (b) escrow accounts, and (c) book and other
      overdrafts.

     

    “Prepayment”
means
      a
      Revolving Loan Mandatory Prepayment, a Revolving Loan Optional Prepayment,
      or a
      Term Line Optional Prepayment, as the case may be, and “Prepayments”
mean
      collectively all Revolving Loan Mandatory Prepayments, all Revolving Loan
      Optional Prepayments, and all Term Line Optional Prepayments.

     

    “Prime
      Rate”
means
      the highest prime rate published in The Wall Street Journal in its table
      entitled “Money Rates” or such similar publication, quoting service, or commonly
      available source used by the Agent for determining prime rate of interest.
      

     

    “Pro
      Rata Share”
means
      with respect to all matters relating to any Lender, the percentage obtained
      by
      dividing (i) the Commitments of that Lender by (ii) the Aggregate Commitments
      of
      all Lenders.

     

    “Receivables”
means
      the collective reference to: (a) all of the Borrower’s present and future
      accounts, contract rights, receivables, promissory notes and other instruments,
      chattel paper, General Intangibles, and investment property; (b) all present
      and
      future tax refunds of the Borrower and all present and future rights of the
      Borrower to refunds or returns of prepaid expenses, including unearned insurance
      premiums; (c) all present and future cash of the Borrower; (d) all deposit
      accounts now or hereafter maintained or established by, for or on behalf of
      the
      Borrower with any bank or other institution, and all balances of funds now
      or
      hereafter on deposit in all such accounts, including, without limitation, all
      checking accounts, collection accounts, lockbox accounts, disbursement accounts,
      concentration accounts and all other deposit accounts of every kind and nature;
      (e) all present and future judgments, orders, awards and decrees in favor of
      the
      Borrower and causes of action in favor of the Borrower; (f) all present and
      future claims, rights of indemnification and other rights of the Borrower under
      or in connection with any contracts or agreements to which the Borrower is
      or
      becomes a party or third party beneficiary; (g) all rights and claims of the
      Borrower with respect to any deposits of money or other property made with
      any
      lessors of any property, insurers, bonding agents or any other persons; (h)
      all
      present and future rights and claims which the Borrower may now or hereafter
      have under any insurance policies, contracts or coverages now or hereafter
      in
      effect; (i) all rights which the Borrower may now or at any time hereafter
      have,
      by law or agreement, against any Account Debtor or other obligor of the
      Borrower, and all supporting obligations, rights, liens and security interests
      which the Borrower may now or at any time hereafter have, by law or agreement,
      against any property of any Account Debtor or other obligor of the Borrower;
      (j)
      all present and future customer lists of the Borrower; (k) all present and
      future contingent and non-contingent rights of the Borrower to the payment
      of
      money for any reason whatsoever, whether arising in contract, tort or otherwise
      whether or not such rights are otherwise included in this definition, (l) all
      books and records in whatever media (paper, electronic or otherwise) recorded
      or
      stored, with respect to any or all of the foregoing and all equipment and
      general intangibles necessary or beneficial to retain, access and/or process
      the
      information contained in those books and records, and (m) all present and future
      rights of the Borrower with respect to licenses patents copyrights franchises
      trade names and trademarks. “Receivable”
means
      each of the Receivables. Without limitation of the foregoing it is specifically
      understood and agree that the Receivables shall include all right, title and
      interest of the Borrower in and to all Premium Finance Agreements whether now
      existing or hereafter arising and all amounts due or to become due
      thereunder.

     

    
       

      
        
          
          

        

        
          -19-

          
          

        

        
          
          

        

      

    

    “Reportable
      Event”
means
      any of the events set forth in Section 4043(c) of ERISA or the regulations
      thereunder.

     

    “Required
      Lenders”
means
      at any time of determination one or more of the Lenders holding at least
      sixty-six and two-thirds percent (66-2/3%) of the Commitments.

     

    “Reserve
      Percentage”
means,
      at any time, then current maximum rate for which reserves (including any basic,
      special, supplemental, marginal and emergency reserves) are required to be
      maintained by member banks of the Federal Reserve System under Regulation D
      of
      the Board of Governors of the Federal Reserve System against “Eurocurrency
      liabilities”,
      as
      that term is defined in Regulation D. Without
      limiting the effect of the foregoing, the Reserve Percentage shall reflect
      any
      other reserves required to be maintained by such member banks with respect
      to
      (i) any category of liabilities which includes deposits by reference to which
      the LIBOR Rate is to be determined, or (ii) any category of extensions of credit
      or other assets which include LIBOR Loans. The
      LIBOR
      Rate shall be adjusted automatically on and as of the effective date of any
      change in the Reserve Percentage.

     

    “Reserves”
means
      the collective reference to reserves, in amounts and with respect to such
      matters, as the Agent in its sole discretion shall deem necessary or appropriate
      to establish against the Borrowing Base, including, without limitation, reserves
      with respect to (i) sums that the Borrower is required to pay (such as taxes,
      assessments, insurance premiums, or, in the case of leased assets, rents or
      other amounts payable under such leases) and has failed to pay under any
      provision of this Agreement or any of the other Financing Documents, and (ii)
      amounts owing by the Borrower to any Person to the extent secured by a Lien
      on,
      or trust over, any of the Collateral, which Lien or trust as the Agent in its
      discretion deems likely to have a priority superior to Liens of the Agent and
      the Lenders (such as Liens or trusts in favor of landlords, warehousemen,
      carriers, mechanics, materialmen, laborers, or suppliers, or Liens or trusts
      for
ad
      valorem,
      excise,
      sales, or other taxes where given priority under applicable law) in all or
      any
      part of the Collateral; it being understood and agreed that Reserves are
      established solely for the benefit of the Agent and the Lenders and no other
      Person, including, without limitation, the Borrower, shall have any rights
      or
      interests with respect to the establishment or failure to establish
      Reserves.

     

    
       

      
        
          
          

        

        
          -20-

          
          

        

        
          
          

        

      

    

    “Responsible
      Officer”
means
      the chief executive officer of the Borrower or the president of the Borrower
      or
      as any Vice President of the Borrower.

     

    “Responsible
      Officer - Parent”
means
      the chief executive officer of the Parent or the president of the Parent or,
      with respect to financial matters, the chief financial officer of the
      Parent.

     

    “Revolver
      Usage”
means,
      as of any date of determination, the aggregate of the outstanding principal
      balance of the Revolving Loan (including, without limitation, Agent Advances
      and
      M&T Advances).

     

    “Revolving
      Credit Commitment”
means
      the agreement of a Lender relating to the making of Advances subject to and in
      accordance with the provisions of this Agreement; “Revolving
      Credit Commitments”
means
      the collective reference to the Revolving Credit Commitment of each of the
      Lenders. 

     

    “Revolving
      Credit Commitment Period”
means
      the period of time from the Closing Date to the Business Day preceding the
      Revolving Credit Termination Date.

     

    “Revolving
      Credit Committed Amount”
means
      the amount of each Lender’s Revolving Credit Commitment, in each case as set
      forth beside such Lender’s name under the applicable heading on EXHIBIT
      A-3
      to this
      Agreement or in the assignment pursuant to which such Lender became a Lender
      hereunder in accordance with the provisions of Section
      9.6
      (Assignments by Lenders).

     

    “Revolving
      Credit Expiration Date”
means
      June 30, 2008.

     

    “Revolving
      Credit Facility”
means
      the facility established by the Lenders pursuant to Section
      2.1
      (Revolving Credit Facility).

     

    “Revolving
      Credit Note”
and
      “Revolving
      Credit Notes”
have
      the meanings described in Section
      2.1.6
      (Revolving Credit Notes).

     

    “Revolving
      Credit Pro Rata Share”
means
      the Pro Rata Share of the Revolving Loan Commitments.

     

    “Revolving
      Credit Termination Date”
means
      the earlier of (a) the Revolving Credit Expiration Date, or (b) the date on
      which the Revolving Credit Commitments are terminated pursuant to Section
      7.2
      (Remedies) or otherwise.

    
       

      
        
          
          

        

        
          -21-

          
          

        

        
          
          

        

      

    

     

    “Revolving
      Credit Unused Line Fee”
and
      “Revolving
      Credit Unused Line Fees”
have
      the meanings described in Section
      2.1.12
      (Revolving Credit Unused Line Fee).

     

    “Revolving
      Loan”
has
      the
      meaning described in Section
      2.1.1
      (Revolving Credit Facility).

     

    “Revolving
      Loan Account”
has
      the
      meaning described in Section
      2.1.11
      (Revolving Loan Account).

     

    “Revolving
      Loan Mandatory Prepayment”
and
      “Revolving
      Loan Mandatory Prepayments”
have
      the meanings described in Section
      2.1.7
      ((Mandatory Prepayments of Revolving Loan).

     

    “Revolving
      Loan Optional Prepayment”
and
      “Revolving
      Loan Optional Prepayments”
have
      the meanings described in Section
      2.1.8
      (Optional Prepayment of Revolving Loan).

     

    “Security
      Documents”
means
      collectively any assignment, pledge agreement, security agreement, mortgage,
      deed of trust, deed to secure debt, financing statement and any similar
      instrument, document or agreement under or pursuant to which a Lien is now
      or
      hereafter granted to, or for the benefit of, the Agent and/or the Lenders on
      any
      real or personal property of any Person to secure all or any portion of the
      Obligations, all as the same may from time to time be amended, restated,
      supplemented or otherwise modified including, without limitation, this
      Agreement, the Wind Down Guaranty, the Corporate Guaranties, the Assignment
      of
      Life Insurance, the Servicing Agreement Assignment, the Stock Pledge Agreements,
      and the Guarantor Security Agreements.

     

    “Servicer”
means
      Input 1, LLC; and such additional or other servicer as Agent may approve in
      writing from time to time.

     

    “Servicing
      Agreement”
means
      that certain Full Service Data Processing and Consulting Agreement, dated July
      7, 2003, between the Borrower and the Servicer, as the same may be as amended,
      restated, modified, substituted, extended, replaced and renewed from time to
      time, with the Agent’s prior written consent.

     

    “Servicing
      Agreement Assignment”
means
      that certain collateral assignment of the Servicing Agreement among the Agent,
      the Servicer and the Borrower, as amended, restated, modified, substituted,
      extended, replaced and renewed from time to time.

     

    “Servicing
      Agreement Documents”
means
      the collective reference to the Servicing Agreement, the Servicing Agreement
      Assignment, and any and all agreements and documents now or at any time
      evidencing, securing, guarantying or otherwise executed and delivered in
      connection with the Servicing Agreement, as the same may from time to time
      be as
      amended, restated, modified, substituted, extended and renewed from time to
      time.

     

    “Settlement”
has
      the
      meaning set forth in Section
      2.7.2(a).

     

    “Settlement
      Date”
means
      each Business Day after the Closing Date selected by the Agent in its sole
      discretion subject to and in accordance with the provisions of Section
      2.7
      (Settlement Among Lenders) as of which a Settlement Report is delivered by
      the
      Agent and on which settlement is to be made among the Lenders in accordance
      with
      the provisions of Section
      2.7.2
      (Revolving Loan Settlement).

     

    
       

      
        
          
          

        

        
          -22-

          
          

        

        
          
          

        

      

    

    “Settlement
      Report”
means
      each report prepared by the Agent and delivered to each Lender and setting
      forth, among other things, as of the Settlement Date indicated thereon and
      as of
      the immediately preceding Settlement Date, the aggregate outstanding principal
      balance of the Revolving Loan, each Lender’s Revolving Credit Pro Rata Share
      thereof, each Lender’s funded portion of the Advances (including, without
      limitation, Agent Advances and M&T Loans) made, and all payments of
      principal, interest, Fees and other amounts received by the Agent from the
      Borrower during the period beginning on such immediately preceding Settlement
      Date and ending on such Settlement Date.

     

    “Solvent”
means
      when used with respect to any Person that at the time of
      determination:

     

    (a) the
      assets of such Person, at a fair valuation, are in excess of the total amount
      of
      its debts (including, without limitation, contingent liabilities);
      and

     

    (b) the
      present fair saleable value of its assets is greater than its probable liability
      on its existing debts as such debts become absolute and matured;
      and

     

    (c) it
      is
      then able and expects to be able to pay its debts (including, without
      limitation, contingent debts and other commitments) as they mature;
      and

     

    (d) it
      has
      capital sufficient to carry on its business as conducted and as proposed to
      be
      conducted.

     

    For
      purposes of determining whether a Person is Solvent, the amount of any
      contingent liability shall be computed as the amount that, in light of all
      the
      facts and circumstances existing at such time, represents the amount that can
      reasonably be expected to become an actual or matured liability.

     

    “State”
means
      the State of Maryland.

     

    “Stock
      Pledge Agreements”
means
      the collective reference to those certain pledge, assignment and security
      agreements, dated as of the Original Closing Date or dated the date hereof
      from
      Parent and the other pledgors identified below to the Agent for the benefit
      of
      the Lenders, as the same may from time to time be amended, restated,
      supplemented or otherwise modified:

     

    
      	
               

              Pledgor

               

            	
               

              Stock
                covered

               

            
	
               

              Parent

               

            	
               

              Blast
                Acquisition Corp., Intandem Corp., DCAP Management Corp., Dealers
                Choice
                Automotive Planning, Inc., the Borrower, AADCAP Greenbrook, Inc.,
                and IAH,
                Inc. (formerly known as International Airport Hotel, Inc.)

               

            

    

    
       

      
        
          
          

        

        
          -23-

          
          

        

        
          
          

        

      

    

     

    
      	
               

              Barry
                Scott Companies, Inc.

               

            	
               

              Barry
                Scott Acquisition Corp., Barry Scott Agency, Inc., Baron Cycle,
                Inc.

               

               

              DCAP
                Accurate, Inc.

               

            
	
               

              Blast
                Acquisition Corp.

               

            	
               

              AIA
                DCAP Corp and Barry Scott Companies, Inc.

               

            

    

     

    “Subordinated
      Debt
      (Parent)”
means
      that certain Indebtedness for Borrowed Money of the Borrower owed by Parent
      to
      Parent Subordinated Note Purchasers in a face principal amount of One Million
      Five Hundred Thousand Dollars ($1,500,000).

     

    “Subordinated
      Debt Documents”
means
      any and all promissory notes, agreements, documents or instruments now or at
      any
      time evidencing, securing, guarantying or otherwise executed and delivered
      in
      connection with the Subordinated Debt (Parent), as the same may from time to
      time be amended, restated, supplemented or modified.

     

    “Subordinated
      Indebtedness”
means
      all indebtedness, including, without limitation, the Subordinated Debt (Parent),
      incurred at any time by the Borrower, that is in amounts, subject to repayment
      terms, and subordinated to the Obligations, as set forth in one or more written
      agreements, all in form and substance satisfactory to the Agent in its sole
      and
      absolute discretion.

     

    “Subordination
      Agreement”
means
      that certain subordination agreement by the Parent and the Borrower in favor
      of
      the Agent and the Lenders, as the same may be from time to time amended,
      restated, supplemented or modified.

     

    “Subsidiary”
means
      of a Person means any corporation, association, partnership, joint venture
      or
      other business entity of which more than fifty percent (50%) of the voting
      stock
      or other equity interests (in the case of Persons other than corporations),
      is
      owned or controlled directly or indirectly by the Person, or one or more of
      the
      Subsidiaries of the Person, or a combination thereof. Unless the context
      otherwise clearly requires, references herein to a “Subsidiary”
refer
      to a Subsidiary of the Borrower and to any Subsidiary of any such
      Subsidiary.

     

    “Supporting
      Obligation”
means
      a
      letter-of-credit right, secondary obligation, or obligation of a secondary
      obligor, or secondary obligation that supports the payment or performance of
      an
      account, chattel paper, a document, a general intangible, an instrument, or
      investment property.

     

    “Tangible
      Net Worth”
has
      the
      meaning set forth in Section
      6.1.15(a).

    
       

      
        
          
          

        

        
          -24-

          
          

        

        
          
          

        

      

    

     

    “Taxes”
means
      all taxes and assessments whether general or special, ordinary or extraordinary,
      or foreseen or unforeseen, of every character (including all penalties or
      interest thereon), that at any time may be assessed, levied, confirmed or
      imposed by any Governmental Authority on the Borrower or any of its properties
      or assets or any part thereof or in respect of any of its franchises,
      businesses, income or profits.

     

     “Term
      Line”
has
      the
      meaning described in Section
      2.2
      (The
      Term Line).

     

    “Term
      Line Advance Period”
means
      the period of time from the Closing Date to May 31, 2008.

     

    “Term
      Line Commitment”
means
      the agreement of a Lender relating to the making of advances subject to and
      in
      accordance with the provisions of Section 2.2.1(a);
      “Term
      Line Commitments”
means
      the collective reference to the Term Line Commitment of each of the
      Lenders.

     

    “Term
      Line Committed Amount”
means
      $2,500,000.

     

    “Term
      Line Facility”
means
      the facility established by the Lender pursuant to Section
      2.2
      (Term
      Line Facility).

     

    “Term
      Loan Installment Payment Date”
      has
      the
      meaning described in Section 2.2.4
      (Payments of Term
      Line).

     

    “Term
      Line Maturity Date”
means
      the earlier of (a) June 30, 2008, or (b) the Revolving Credit Termination
      Date.

     

    “Term
      Line Optional Prepayment”
and
      “Term
      Line Optional Prepayments”
have
      the meanings described in Section 2.2.6
      (Optional Prepayments of Term Line).

     

    “Term
      Line Note”
and
      “Term
      Line Notes”
have
      the meaning described in Section 2.2.3
      (Term
      Line Notes).

     

    “Term
      Line Pro Rata Share”
means
      the Pro Rata Share of the Term Line Commitments.

     

    “Term
      Line Usage”
means
      the aggregate of all advances outstanding under the Term Line.

     

    “Total
      Revolving Credit Committed Amount”
means
      the aggregate of (a) $20,000,000 minus
      (b) Term
      Line Usage from time to time.

     

    “Total
      Term Line Committed Amount”
means
      $2,500,000.

     

    “Trademarks”
means
      and includes in each case whether now existing or hereafter arising, all of
      the
      Borrower’s rights, title and interest in and to (a) any and all trademarks
      (including service marks), trade names and trade styles, and applications for
      registration thereof and the goodwill of the business symbolized by any of
      the
      foregoing, (b) any and all licenses of trademarks, service marks, trade names
      and/or trade styles, whether as licensor or licensee, (c) any renewals of any
      and all trademarks, service marks, trade names, trade styles and/or licenses
      of
      any of the foregoing, (d) income, royalties, damages and payments now or
      hereafter due and/or payable with respect thereto, including, without
      limitation, damages, claims, and payments for past, present and future
      infringements thereof, (e) rights to sue for past, present and future
      infringements of any of the foregoing, including the right to settle suits
      involving claims and demands for royalties owing, and (f) all rights
      corresponding to any of the foregoing throughout the world.

     

    
       

      
        
          
          

        

        
          -25-

          
          

        

        
          
          

        

      

    

    “Uniform
      Commercial Code”
means,
      unless otherwise provided in this Agreement, the Uniform Commercial Code as
      adopted by and in effect from time to time in the State or in any other
      jurisdiction, as applicable.

     

    “Wholly
      Owned Subsidiary”
means
      any domestic United States corporation all the shares of stock of all classes
      of
      which (other than directors’ qualifying shares) at the time are owned directly
      or indirectly by the Borrower and/or by one or more Wholly Owned Subsidiaries
      of
      the Borrower.

     

    “Wind
      Down Guarantor”
means
      Barry B. Goldstein and his heirs, personal representatives, successors and
      assigns.

     

    “Wind
      Down Guaranty”
means
      that certain conditional guaranty of payment for the benefit of the Lenders
      ratably and the Agent dated the date hereof to the Agent from the Wind Down
      Guarantor, as the same may from time to time be amended, restated, supplemented
      or otherwise modified.

     

    Section
      1.2  Accounting
      Terms and Other Definitional Provisions.

     

    Unless
      otherwise defined herein, as used in this Agreement and in any certificate,
      report or other document made or delivered pursuant hereto, accounting terms
      not
      otherwise defined herein, and accounting terms only partly defined herein,
      to
      the extent not defined, shall have the respective meanings given to them under
      GAAP, as consistently applied to the applicable Person. All terms used herein
      which are defined by the Uniform Commercial Code shall have the same meanings
      as
      assigned to them by the Uniform Commercial Code unless and to the extent varied
      by this Agreement. The words “hereof”, “herein” and “hereunder” and words of
      similar import when used in this Agreement shall refer to this Agreement as
      a
      whole and not to any particular provision of this Agreement, and article,
      section, subsection, schedule and exhibit references are references to articles,
      sections or subsections of, or schedules or exhibits to, as the case may be,
      this Agreement unless otherwise specified. As used herein, the singular number
      shall include the plural, the plural the singular and the use of the masculine,
      feminine or neuter gender shall include all genders, as the context may require.
      Reference to any one or more of the Financing Documents shall mean the same
      as
      the foregoing may from time to time be amended, restated, substituted, extended,
      renewed, supplemented or otherwise modified. Reference in this Agreement and
      the
      other Financing Documents to the “Borrower”, the “Borrowers”, “each Borrower” or
      otherwise with respect to any one or more of the Borrowers shall mean each
      and
      every Person included from time to time in the term “Borrower” and any one or
      more of the Borrowers, jointly and severally, unless a specific Borrower is
      expressly identified.

     

    
       

      
        
          
          

        

        
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    Section
      1.3  Interpretive
      Provisions.

     

    (a) The
      term
“writing” shall have its ordinary meaning except that, to limited extent the
      Agent in an authenticated record expressly so agrees from time to time in the
      exercise of its sole and absolute discretion, the term may also include a record
      in a form other than a writing. The terms “sign,” “signed” and signatures” shall
      have their ordinary meanings except that, to limited extent the Agent in an
      authenticated record expressly agrees otherwise from time to time in the
      exercise of its sole and absolute discretion, the terms may also include other
      methods used to authenticate.

     

    (b) The
      headings in this Agreement are included herein for convenience only, shall
      not
      constitute a part of this Agreement for any other purpose, and shall not be
      deemed to affect the meaning or construction of any of the provisions
      hereof.

     

    (c) This
      Agreement and the other Financing Documents are the result of negotiations
      among
      and have been reviewed by counsel to the Agent, the Lenders, the Borrower and
      the other parties, and are the products of all parties. Accordingly, they shall
      not be construed against the Lenders or the Agent because of the involvement
      of
      the Agent, the Lenders and their counsel in their preparation.

     

    ARTICLE
      II

    THE
      CREDIT FACILITIES

     

    Section
      2.1  The
      Revolving Credit Facility.

     

    2.1.1  The
      Revolving Loan.

     

    (a)  Subject
      to and upon the provisions of this Agreement, the Lenders collectively, but
      severally, establish during the Revolving Credit Period a revolving credit
      facility (sometimes referred to in this Agreement as the “Revolving
      Loan”)
      in
      favor of the Borrower in an amount at any one time outstanding not to exceed
      such Lender’s Revolving Credit Pro Rata Share of an amount equal to the lesser
      of (i) the Aggregate Commitment and (ii) the lesser of (A) the Total Revolving
      Credit Committed Amount and (B) the Borrowing Base. Neither the Agent nor any
      of
      the Lenders shall be responsible for the Revolving Credit Commitment of any
      other Lender, nor will the failure of any Lender to perform its obligations
      under its Revolving Credit Commitment in any way relieve any other Lender from
      performing its obligations under its Revolving Credit Commitment.

     

    (b)  Subject
      to and upon the provisions of this Agreement, the Borrower may request Advances
      during the Revolving Credit Commitment Period in accordance with the provisions
      of this Agreement; provided that after giving effect to the Borrower’s request,
      the aggregate Revolver Usage would not exceed the lesser of (i) the Total
      Revolving Credit Committed Amount or (ii) the Borrowing Base.

     

    (c)  Unless
      sooner paid, the unpaid Revolving Loan, together with interest accrued and
      unpaid thereon, and all other Obligations shall be due and payable in full
      on
      the Revolving Credit Expiration Date.

     

    
       

      
        
          
          

        

        
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    (d)  If
      at any
      time the Revolver Usage exceeds the Total Revolving Credit Committed Amount
      in
      effect from time to time, the Borrower shall pay such excess to the Agent for
      the benefit of the Lender ON DEMAND. 

     

    2.1.2  Requests
      for Advances.

     

    (a)  The
      Borrower may borrow under the Revolving Credit Facility on any Business Day
      Revolving Credit Commitment Period. Not later than 10:00 a.m. (Baltimore City
      Time) on the date of the requested borrowing, the Borrower shall give the Agent
      written notice (a “Loan
      Notice”)
      which
      may be by fax of the amount and (if requested by the Agent) the purpose of
      the
      requested borrowing. Any oral Loan Notice shall be confirmed in writing by
      the
      Borrower within three (3) Business Days after the making of the requested
      Advance. Each Loan Notice shall be irrevocable. Advances under the Revolving
      Loan shall be deposited to a demand deposit account of the Borrower with the
      Lender or shall be otherwise applied as directed by the Borrower, which
      direction the Lender may require to be in writing, except that controlled
      disbursement Advances shall be deposited to a demand deposit account of the
      Borrower with the Agent or shall be otherwise applied as directed by the
      Borrower, which direction the Agent may require to be in writing.

     

    (b)  In
      addition, the Borrower hereby irrevocably authorizes the Lenders at any time
      and
      from time to time, without further request from or notice to the Borrower,
      to
      make Advances, and irrevocably authorizes the Agent to establish, without
      duplication, Reserves against the Borrowing Base, that the Agent, in its sole
      and absolute discretion, deems necessary or appropriate to protect the interests
      of the Agent and/or any or all of the Lenders under this Agreement, including,
      without limitation, Advances and Reserves to cover debit balances in the
      Revolving Loan Account, principal of and interest on any Loan, Bank Products,
      Revolver Usage, Enforcement Costs and the other Obligations, all of the
      foregoing whether prior to, on, or after the termination of other advances
      under
      this Agreement, and regardless of whether the outstanding principal amount
      of
      the Revolving Loan that the Lenders may advance or the Agent may reserve
      hereunder exceeds the Total Revolving Credit Committed Amount or the Borrowing
      Base; provided, however, with respect to Bank Products consisting of credit
      cards, credit card processing services, debit cards, or purchase cards, no
      such
      Advances and Reserves shall be made or imposed unless (i) the Borrower so
      agrees, (ii) the Agent has given the Borrower no less than ten (10) days’ prior
      notice of the Agent’s intent to do so, or (iii) an Event of Default has
      occurred. 

     

    (c)  The
      Agent
      may elect to process the Advances under the Agent’s First Investment Loan
      Manager program, or other automated sweep program in effect at the Agent from
      time to time, to facilitate automatic the Advances to cover items drawn under
      a
      designated demand deposit account of the Borrower with the Agent. The Borrower
      shall enter into the Agent’s standard agreements and instruments (which may
      include promissory notes) in connection such program promptly upon the Agent’s
      request from time to time. The Agent may cease funding under and use of that
      program at any time upon notice to the Borrower.

     

    2.1.3  Computation
      of Borrowing Base.

     

    (a)  As
      used
      in this Agreement, the term “Borrowing Base” means at any time, an amount equal
      to the aggregate of eighty-five percent (85%) of the amount of Eligible
      Receivables (subject to the adjustments provided in Section
      2.1.3(b)) less
      Premium
      Related Liabilities, and provided that the aggregate amount of Eligible
      Receivables relating to commercial carriers that may be included in the
      Borrowing Base is limited to $1,000,000.

    
       

      
        
          
          

        

        
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    (b)  The
      Borrowing Base shall be computed based on the Borrowing Base Report required
      by
Section
      2.1.5
      (Borrowing Base Report) most recently delivered to and accepted by the Agent
      in
      its sole and absolute discretion. In the event the Borrower fails to furnish
      a
      Borrowing Base Report, or in the event the Agent believes that a Borrowing
      Base
      Report is no longer accurate, the Agent may, in its sole and absolute discretion
      exercised from time to time and without limiting other rights and remedies
      under
      this Agreement, direct the Lenders to suspend the making of or limit Advances.
      The Borrowing Base shall be subject to reduction by the amount of Reserves
      applicable from time to time, by amounts credited to the Collateral Account
      since the date of the most recent Borrowing Base Report and by the amount of
      any
      Receivable or that was included in the Borrowing Base but that the Agent
      determines fails to meet the respective criteria applicable from time to time
      for Eligible Receivables.

     

    (c)  Without
      implying any limitation on the Agent’s discretion with respect to the Borrowing
      Base, the criteria for Eligible Receivables contained in the respective
      definitions of Eligible Receivables are in part based upon the business
      operations of the Borrower existing on or about the Closing Date and upon
      information and records furnished to the Agent by the Borrower. If at any time
      or from time to time hereafter, the business operations of the Borrower change
      or such information and records furnished to the Agent is incorrect or
      misleading, the Agent in its discretion, may at any time and from time to time
      during the duration of this Agreement change such criteria or add new criteria.
      The Agent may communicate such changed or additional criteria to the Borrower
      from time to time either orally or in writing.

     

    (d)  If
      at any
      time the Revolver Usage exceeds the Borrowing Base, a borrowing base deficiency
      (“Borrowing
      Base Deficiency”)
      shall
      exist. Each time a Borrowing Base Deficiency exists, the Borrower at the sole
      and absolute discretion of the Agent exercised from time to time shall pay
      the
      Borrowing Base Deficiency ON DEMAND to the Agent for the benefit of the
      Lenders.

     

    2.1.4  Agent’s
      Election.

     

    Promptly
      after receipt of a request or authorization for an Advance pursuant to
Section
      2.1.2
      (Requests For Advances), Agent shall elect, in its discretion, the one of the
      alternatives for funding set forth in Section
      2.6
      (Funding
      of Advances).

     

    2.1.5  Borrowing
      Base Report.

     

    The
      Borrower will furnish to the Agent no less frequently than weekly and at such
      other times as may be requested by the Agent or any of the Lenders a report
      of
      the Borrowing Base (each a “Borrowing Base Report”; collectively, the “Borrowing
      Base Reports”) in the form required from time to time by the Agent,
      appropriately completed and duly signed. The Borrowing Base Report shall contain
      the amount and payments on the Receivables and the calculations of the Borrowing
      Base, all in such detail, and accompanied by such supporting and other
      information, as the Agent may from time to time request. Upon the Agent’s
      request and upon the creation of any Receivables, or at such intervals as the
      Agent may require, the Borrower will provide the Agent with statements and
      such
      further schedules, documents and/or information regarding the Receivables as
      the
      Agent may reasonably require. The items to be provided under this subsection
      shall be in form satisfactory to the Agent, and certified as true and correct
      by
      a Responsible Officer (or by any other officers or employees of the Borrower
      whom a Responsible Officer from time to time authorizes in writing to do so),
      and delivered to the Agent from time to time solely for the Agent’s convenience
      in maintaining records of the Collateral. The Borrower’s failure to deliver any
      of such items to the Agent shall not affect, terminate, modify, or otherwise
      limit the Liens of the Agent and the Lenders in the Collateral.

     

    
       

      
        
          
          

        

        
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    2.1.6  Revolving
      Credit Notes.

     

    The
      obligation of the Borrower to pay each Lender’s Pro Rata Share of the Revolving
      Loan, with interest, shall be evidenced by a series of promissory notes (as
      from
      time to time extended, amended, restated, supplemented or otherwise modified,
      collectively the “Revolving
      Credit Notes”;
      and
      individually a “Revolving
      Credit Note”)
      substantially in the form of EXHIBIT A-1 attached hereto and made a part hereof,
      with appropriate insertions. Each Lender’s Revolving Credit Note shall be dated
      as of the Closing Date, shall be payable to the order of such Lender at the
      times provided in the Revolving Credit Notes, and shall be in the principal
      amount of such Lender’s Revolving Credit Committed Amount. The Borrower
      acknowledges and agrees that, if the outstanding principal balance of the
      Revolving Loan outstanding from time to time exceeds the aggregate face amount
      of the Revolving Credit Notes, the excess shall bear interest at the rate or
      rates provided from time to time for Advances evidenced by the Revolving Credit
      Notes and shall be payable, with accrued interest, ON DEMAND. The Revolving
      Credit Notes shall not operate as a novation of any of the Obligations or
      nullify, discharge, or release any such Obligations or the continuing
      contractual relationship of the parties hereto in accordance with the provisions
      of this Agreement.

     

    2.1.7  Mandatory
      Prepayments of Revolving Loan.

     

    The
      Borrower shall make the mandatory prepayments (each a “Revolving
      Loan Mandatory Prepayment”
and
      collectively, the “Revolving
      Loan Mandatory Prepayments”)
      of the
      Revolving Loan at any time and from time to time in such amounts requested
      by
      the Agent pursuant to Section
      2.1.3
      (Borrowing Base) in order to cover any Borrowing Base Deficiency, provided,
      under the circumstances set forth in Section
      2.1.13
      (Early
      Termination Fee), the Early Termination Fee may be due and payable.

     

    2.1.8  Optional
      Prepayments of Revolving Loan.

     

    The
      Borrower shall have the option at any time and from time to time to prepay
      (each
      a “Revolving
      Loan Optional Prepayment”
and
      collectively the “Revolving
      Loan Optional Prepayments”)
      the
      Revolving Loan, in whole or in part without premium or penalty; provided, under
      the circumstances set forth in Section
      2.1.13
      (Early
      Termination Fee), the Early Termination Fee may be due and payable.

     

    2.1.9  Optional
      Reduction of Revolving Credit Committed Amount.

     

    The
      Borrower shall have the right to reduce permanently (each a “Revolving Credit
      Optional Reduction” and collectively the “Revolving Credit Optional Reductions”)
      the Revolving Credit Committed Amount in effect from time to time in the amount
      of any integral multiple of One Million Dollars ($1,000,000), upon at least
      ten
      (10) Business Days prior written notice to the Lender specifying the date and
      amount of such Revolving Credit Optional Reduction; provided, that no Revolving
      Credit Optional Reduction shall be permitted if, after giving effect thereto
      and
      to any Revolving Loan Optional Prepayment made on the effective date thereof,
      either (a) the then Revolver Usage exceeds the Revolving Credit Committed Amount
      as so reduced or (b) the Revolving Credit Committed Amount after such reduction
      would be less than Fifteen Million Dollars ($15,000,000). Such notice shall
      be
      irrevocable as to the amount and date of such Revolving Credit Optional
      Reduction. After each such Revolving Credit Optional Reduction, the Revolving
      Credit Unused Line Fee provided for in Section
      2.1.12
      (Revolving Credit Unused Line Fee) and the Early Termination Fee provided for
      in
Section
      2.1.13
      (Early
      Termination Fee) shall be calculated with respect to the Revolving Credit
      Committed Amount as so reduced.

     

    
       

      
        
          
          

        

        
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    2.1.10  Collateral
      Account.

     

    The
      Borrower will deposit, or cause to be deposited, all Items of Payment to a
      bank
      account designated by the Agent and from which the Agent alone has power of
      access and withdrawal (the “Collateral
      Account”)
      styled
“Manufacturers and Traders Trust Company, assignee of Payments Inc.” or other
      styling acceptable to the Agent. Each deposit shall be made not later than
      the
      next Business Day after the date of receipt of the Items of Payment. The Items
      of Payment shall be deposited in precisely the form received, except for the
      endorsements of the Borrower where necessary to permit the collection of any
      such Items of Payment, which endorsement the Borrower hereby agrees to make.
      In
      the event the Borrower fails to do so, the Borrower hereby authorizes the Agent
      to make the endorsement in the name of the Borrower. Prior to such a deposit,
      the Borrower will not commingle any Items of Payment with any of the Borrower’s
      other funds or property, but will hold them separate and apart in trust and
      for
      the account of the Agent for the benefit of the Lenders ratably and the
      Agent.

     

    In
      addition, if so directed by the Agent, the Borrower shall direct the mailing
      of
      all Items of Payment from its Account Debtors to one or more post-office boxes
      designated by the Agent (or, with the Agent’s consent, designated by the
      Servicer), or to such other additional or replacement post-office boxes pursuant
      to the request of the Agent from time to time (collectively, the “Lockbox”).
      The
      Agent shall have unrestricted and exclusive access to the Lockbox.

     

    The
      Borrower hereby authorizes the Agent to inspect all Items of Payment, endorse
      all Items of Payment in the name of the Borrower, and deposit such Items of
      Payment in the Collateral Account. The Agent reserves the right, exercised
      in
      its sole and absolute discretion from time to time, to provide to the Collateral
      Account credit prior to final collection of an Item of Payment and to disallow
      credit for any Item of Payment that is unsatisfactory to the Agent. In the
      event
      Items of Payment are returned to the Agent for any reason whatsoever, the Agent
      may, in the exercise of its discretion from time to time, forward such Items
      of
      Payment a second time. Any returned Items of Payment shall be charged back
      to
      the Collateral Account, the Revolving Loan Account, or other account, as
      appropriate.

     

    Upon
      the
      Agent’s receipt of collected funds from the Collateral Account in Baltimore,
      Maryland, the Agent will credit the collected funds to the Obligations arising
      under this Agreement or under the Note (or following an Event of Default, any
      of
      the Obligations), the order and method of such application to be in the sole
      discretion of the Agent.

     

    
       

      
        
          
          

        

        
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    2.1.11  Revolving
      Loan Account.

     

    The
      Agent
      will establish and maintain a loan account on its books (the “Revolving
      Loan Account”)
      to
      which the Agent will (a) debit
      (i) the
      principal amount of each Advance made by the Lenders hereunder as of the date
      made, (ii) the amount of any interest accrued on the Revolving Loan as and
      when
      due, and (iii) any other amounts due and payable by the Borrower to the Agent
      and/or the Lenders from time to time under the provisions of this Agreement
      in
      connection with the Revolving Loan, including, without limitation, Enforcement
      Costs, Fees, late charges, and service, collection and audit fees, as and when
      due and payable, and (b) credit
      all
      payments made by the Borrower to the Agent on account of the Revolving Loan
      as
      of the date made including, without limitation, funds credited to the Revolving
      Loan Account from the Collateral Account. The Agent may debit the Revolving
      Loan
      Account for the amount of any Item of Payment that is returned to the Agent
      unpaid. All credit entries to the Revolving Loan Account are conditional and
      shall be readjusted as of the date made if final and indefeasible payment is
      not
      received by the Agent in cash or solvent credits. Any and all periodic or other
      statements or reconciliations, and the information contained in those statements
      or reconciliations, of the Revolving Loan Account shall be final, binding and
      conclusive upon the Borrower in all respects, absent manifest error, unless
      the
      Agent receives specific written objection thereto from the Borrower within
      thirty (30) Business Days after such statement or reconciliation shall have
      been
      sent by the Agent.

     

    2.1.12  Revolving
      Credit Unused Line Fee.

     

    The
      Borrower shall pay to the Agent for the ratable benefit of the Lenders a monthly
      revolving credit facility fee (collectively, the “Revolving
      Credit Unused Line Fees”
and
      individually, a “Revolving
      Credit Unused Line Fee”)
      in an
      amount equal to one-quarter of one percent (0.25%) per annum of the average
      daily unused and undisbursed portion of the Total Revolving Credit Committed
      Amount in effect from time to time accruing during each month. The accrued
      and
      unpaid portion of the Revolving Credit Unused Line Fee shall be paid by the
      Borrower to the Agent on the first day of each month, commencing on the first
      such date following the date hereof, and on the Revolving Credit Termination
      Date.

     

    2.1.13  Early
      Termination Fee.

     

    In
      the
      event of the termination of the Revolving Credit Commitment by, or on behalf
      of,
      the Borrower, the Borrower shall pay a fee (the “Early
      Termination Fee”)
      equal
      to 1.0% of the Aggregate Commitments. Termination of the Revolving Credit
      Commitment in whole or in part following and as a result of the institution
      of
      any bankruptcy proceeding by or against the Borrower, shall be deemed to be
      a
      termination of the Revolving Credit Commitment subject to the Early Termination
      Fee provided in this subsection. The Early Termination Fee shall be paid to
      the
      Agent for the ratable benefit of the Lenders.

     

    
       

      
        
          
          

        

        
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    Section
      2.2  The
      Term Line
      Facility.

     

    2.2.1  The
      Term Line.

     

    (a)  Subject
      to and upon the provisions of this Agreement, the Lenders collectively, but
      severally, establish during the Term Line Advance Period a multiple-advance
      term
      loan facility (sometimes referred to in this Agreement as the “Term Line”) in
      favor of the Borrower in an amount at any one time outstanding not to exceed
      such Lender’s Term Line Pro Rata Share of the Total Term Line Committed Amount.
      Neither the Agent nor any of the Lenders shall be responsible for the Term
      Line
      Commitment of any other Lender, nor will the failure of any Lender to perform
      its obligations under its Term Line Commitment in any way relieve any other
      Lender from performing its obligations under its Term Line
      Commitment.

     

    (b)  Subject
      to and upon the provisions of this Agreement, the Borrower may request Term
      Line
      advances during the Term Line Advance Period in accordance with the provisions
      of this Agreement; provided that after giving effect to the Borrower’s request,
      (i) the
      aggregate of all advances under the Term Line
      would
      not exceed the Total Term Line Committed Amount and (ii) the aggregate of (A)
      Term Line Usage plus
      (B)
      Revolver Usage would not exceed the Aggregate Commitments.

     

    (c)  If
      at any
      time the aggregate of all advances under the Term Line exceeds the Total Term
      Line Committed Amount in effect from time to time, the Borrower shall pay such
      excess to the Agent for the benefit of the Lender ON DEMAND. 

     

    2.2.2  Term
      Line Procedures.

     

    (a)  The
      Borrowers may borrow under the Term Line on any Business Day during the Term
      Line Advance Period. 

     

    (b)  An
      advance under the Term Line to made on the date of this Agreement in the amount
      of One Million Three Hundred Thousand Dollars ($1,300,000) has been approved
      by
      the Lenders. 

     

    (c)  Any
      subsequent advance under the Term Line shall require the prior written consent
      of all of the Lenders, which consent may be given or withheld in the sole and
      absolute discretion of the Lenders. Without implying any limitation on the
      foregoing, the Borrower shall be obligated to provide such information,
      certificates, confirmations, and other items as the Agent and any one or more
      of
      the Lenders may require in connection with any proposed advance. 

     

    (d)  The
      proceeds of each advance under the Term Line shall be used for Permitted Uses,
      and for no other purposes except as may otherwise be agreed by the Lenders
      in
      writing. The Borrower shall use the proceeds of the Loans promptly.

     

    2.2.3  Term
      Line Notes.

     

    The
      obligation of the Borrower to pay each Lender’s Pro Rata Share of each advance
      under the Term Line, with interest, shall be evidenced by a series of promissory
      notes (as from time to time extended, amended, restated, supplemented or
      otherwise modified, collectively the “Term
      Line Notes”;
      and
      individually a “Term
      Line Note”)
      substantially in the form of EXHIBIT A-2 attached hereto and made a part hereof,
      with appropriate insertions. Each Lender’s Term Line Note shall be dated as of
      the date of the applicable advance under the Term Line, shall be payable to
      the
      order of such Lender at the times provided in the Term Line Notes, and shall
      be
      in the principal amount of such Lender’s the applicable advance under the Term
      Line. The Borrower acknowledges and agrees that, if the Term Line Usage exceeds
      the aggregate face amount of the Term Line Notes, the excess shall bear interest
      at the rate or rates provided from time to time for advances evidenced by the
      Term Line Notes and shall be payable, with accrued interest, ON DEMAND. The
      Term
      Line Notes shall not operate as a novation of any of the Obligations or nullify,
      discharge, or release any such Obligations or the continuing contractual
      relationship of the parties hereto in accordance with the provisions of this
      Agreement.

     

    
       

      
        
          
          

        

        
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    2.2.4  Payments
      of Term Line.

     

    The
      Borrower shall make monthly installment payments of principal on the first
      day
      of each month, commencing on the first or second (at the Agent’s election) such
      day after the date of the Term Line advance (each, a “Term Line Installment
      Payment Date”), with respect to the Term Line advance. The One Million Three
      Hundred Thousand Dollars ($1,300,000) advance on the Closing Date, however,
      shall be repayable in equal quarterly installments of principal in an amount
      equal to 1/10th of such Term Line advance, on the first day of each _______,
      _______, _______ and _________. In the event the Lenders in the exercise of
      their sole and absolute discretion from time to time approve one or more
      subsequent advances, such advances shall be subject to repayment terms
      established by the Lenders at that time.

     

    2.2.5  Term
      Line Maturity.

     

    The
      Term
      Line shall mature, and the entire unpaid principal balance and accrued and
      unpaid interest thereon shall be due and payable on the Term Line Maturity
      Date.

     

    2.2.6  Optional
      Prepayments of Term Line.

     

    The
      Borrower may, at its option, at any time and from time to time prepay (each
      a
“Term
      Line Optional Prepayment”
and
      collectively the “Term
      Line Optional Prepayments”)
      the
      Term Line, in whole or in part without premium or penalty, upon five (5)
      Business Days prior written notice, specifying the date and amount of
      prepayment. The amount to be so prepaid, together with interest accrued thereon
      to date of prepayment if the amount is intended as a prepayment of the Term
      Line
      in whole, shall be paid by the Borrower to the Lender on the date specified
      for
      such prepayment. Partial Term Line Loan Optional Prepayments shall be in an
      amount not less than the aggregate amount of the next principal installment
      under the applicable Term Line Note and shall be applied first to all accrued
      and unpaid interest on the principal of the applicable Term Line Note, and
      then
      to the balloon payment, if any, due at maturity and to the principal installment
      payments in the inverse order of maturity. In the absence of a direction from
      the Borrower and at any time during the continuance of an Event of Default,
      Term
      Line Optional Prepayments shall be applicable to one or more of the Term Line
      Notes as the Agent may elect in the exercise of its sole and absolute discretion
      from time to time.

     

    
       

      
        
          
          

        

        
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    Section
      2.3  Certain
      Interest and Fee Provisions.

     

    2.3.1  Payment
      of Interest.

     

    Unpaid
      and accrued interest on the Loans shall be paid monthly, in arrears, on the
      first day of each calendar month, commencing on the first such date after the
      date of this Agreement, and on the first day of each calendar month thereafter,
      and at maturity (whether by acceleration, declaration, extension or
      otherwise).

     

    2.3.2  Arrangement
      Fee.

     

    The
      Borrowers shall pay the Arrangement Fee to the Agent for the sole and exclusive
      benefit of the Agent on or before the Closing Date, which Arrangement Fee shall
      be fully earned and nonrefundable upon payment and shall be a part of the
      Agent’s Obligations.

     

    2.3.3  Monitoring
      Fees.

     

    The
      Borrower shall pay to the Agent for the sole and exclusive benefit of the Agent
      on the Closing Date and on the first day of each month thereafter until the
      Obligations have been paid in full and the Revolving Credit Commitment has
      been
      terminated, a loan administration fee (collectively, the “Monitoring Fees”) in
      the amount of One Thousand Five Hundred Dollars ($1,500), which shall be fully
      earned when due and non-refundable.

     

    2.3.4  Computation
      of Interest and Fees.

     

    All
      applicable Fees and interest shall be calculated on the basis of a year of
      360
      days for the actual number of days elapsed. Any change in the interest rate
      on
      any of the Obligations resulting from a change in the Prime Rate shall become
      effective as of the opening of business on the day on which such change in
      the
      Prime Rate is announced.

     

    2.3.5  Maximum
      Interest Rate.

     

    In
      no
      event shall any interest rate provided for hereunder exceed the maximum rate
      permissible for corporate borrowers under applicable law for loans of the type
      provided for hereunder (the “Maximum
      Rate”).
      If,
      in any month, any interest rate, absent such limitation, would have exceeded
      the
      Maximum Rate, then the interest rate for that month shall be the Maximum Rate,
      and, if in future months, that interest rate would otherwise be less than the
      Maximum Rate, then that interest rate shall remain at the Maximum Rate until
      such time as the amount of interest paid hereunder equals the amount of interest
      that would have been paid if the same had not been limited by the Maximum Rate.
      In the event that, upon payment in full of the Obligations, the total amount
      of
      interest paid or accrued under the terms of this Agreement is less than the
      total amount of interest that would, but for this Section, have been paid or
      accrued if the interest rates otherwise set forth in this Agreement had at
      all
      times been in effect, then the Borrower shall, to the extent permitted by
      applicable law, pay the Agent for the ratable benefit of the Lenders, an amount
      equal to the excess of (a) the lesser of (i) the amount of interest that would
      have been charged if the Maximum Rate had, at all times, been in effect or
      (ii)
      the amount of interest that would have accrued had the interest rates otherwise
      set forth in this Agreement, at all times, been in effect over (b) the amount
      of
      interest actually paid or accrued under this Agreement. In the event that a
      court determines that the Lenders have received interest and other charges
      hereunder in excess of the Maximum Rate, such excess shall be deemed received
      on
      account of, and shall automatically be applied to reduce, the Obligations other
      than interest, in the inverse order of maturity, and if there are no Obligations
      outstanding, the Lenders shall refund to the Borrower such excess.

    
       

      
        
          
          

        

        
          -35-

          
          

        

        
          
          

        

      

    

     

    2.3.6  Liens;
      Setoff

     

    The
      Borrower hereby grants to the Agent and to the Lenders a continuing Lien for
      all
      of the Obligations (including, without limitation, the Agent’s Obligations) upon
      any and all monies, securities, and other property of the Borrower and the
      proceeds thereof, now or hereafter held or received by or in transit to, the
      Agent, any of the Lenders, and/or any Affiliate of the Agent and/or any of
      the
      Lenders, from or for the Borrower, and also upon any and all deposit accounts
      (general or special) and credits of the Borrower, if any, with the Agent, any
      of
      the Lenders or any Affiliate of the Agent or any of the Lenders, at any time
      existing, excluding any deposit accounts held by the Borrower in its capacity
      as
      trustee for Persons who are not the Borrower or Affiliates of the Borrower.
      Without implying any limitation on any other rights the Agent and/or the Lenders
      may have under the Financing Documents or applicable Laws, during the
      continuance of an Event of Default, the Agent and the each of the Lenders,
      respectively, are hereby authorized by the Borrower at any time and from time
      to
      time, without notice to the Borrower, to set off, appropriate and apply any
      or
      all items hereinabove referred to against all Obligations (including, without
      limitation, the Agent’s Obligations) then outstanding (whether or not then due),
      all in such order and manner as shall be determined by the Agent in its sole
      and
      absolute discretion; except that no Lender shall exercise any such right without
      the prior written consent of the Agent. Any Lender exercising a right to set
      off
      shall purchase for cash (and the other Lenders shall sell) interests in each
      of
      such other Lender’s Pro Rata Share of the Obligations as would be necessary to
      cause all Lenders to share the amount so set off with each other Lender in
      accordance with their respective Pro Rata Shares. The Borrower agrees, to the
      fullest extent permitted by law, that any Lender may exercise its right to
      set
      off with respect to amounts in excess of its Pro Rata Share of the Obligations
      and upon doing so shall deliver such amount so set off to the Agent for the
      benefit of all Lenders in accordance with their Pro Rata Shares.

     

    2.3.7  Requirements
      of Law.

     

    In
      the
      event that any Lender shall have determined in good faith that (a) the adoption
      of any Capital Adequacy Regulation, or (b) any change in any Capital Adequacy
      Regulation or in the interpretation or application thereof or (c) compliance
      by
      such Lender or any corporation controlling such Lender with any request or
      directive regarding capital adequacy (whether or not having the force of law)
      from any central bank or Governmental Authority, does or shall have the effect
      of reducing the rate of return on the capital of such Lender or any corporation
      controlling such Lender, as a consequence of the obligations of such Lender
      hereunder to a level below that which such Lender or any corporation controlling
      such Lender would have achieved but for such adoption, change or compliance
      (taking into consideration the policies of such Lender and the corporation
      controlling such Lender, with respect to capital adequacy) by an amount deemed
      by such Lender to be material, then from time to time, after submission by
      such
      Lender to the Borrower of a written request therefor and a statement of the
      basis for such determination, the Borrower shall pay to such Lender such
      additional amount or amounts in order to compensate for such
      reduction.

     

    
       

      
        
          
          

        

        
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    Section
      2.4  Interest.

     

    2.4.1  Applicable
      Interest Rate - Term Line.

     

    The
      provisions of this Section 2.4.1
      (Applicable Interest Rate - Term Line) apply only to the Term Line.

     

    (a)  The
      Term
      Line shall bear interest until paid at the LIBOR Floating Rate, or as otherwise
      determined in accordance with the provisions of this Section
      2.4.
      

     

    (b)  Notwithstanding
      the foregoing, following the occurrence and during the continuance of an Event
      of Default, at the option of the Agent, the Term Line until paid shall bear
      interest at the Post-Default Rate.

     

    (c)  The
      Applicable Margin for the LIBOR Floating Rate Loans under the Term Line shall
      be
      two hundred seventy-five (275) basis points per annum,

     

    2.4.2  Applicable
      Interest Rate - Revolving Loan.

     

    The
      provisions of this Section 2.4.2
      (Applicable Interest Rate - Revolving Loan) apply only to the Revolving
      Loan.

     

    (a)  Each
      Loan
      shall bear interest until paid at either a Floating Rate or the LIBOR Rate,
      as
      selected and specified by the Borrower in an Interest Rate Election Notice
      furnished to the Lender in accordance with the provisions of Section
      2.4.3(e),
      or as
      otherwise determined in accordance with the provisions of this Section
      2.4,
      and as
      may be adjusted from time to time in accordance with the provisions of
Section
      2.4.4
      (Inability to Determine LIBOR Base Rate).

     

    (b)  Notwithstanding
      the foregoing, following the occurrence and during the continuance of an Event
      of Default, at the option of the Agent, all Loans and all other Obligations
      until paid shall bear interest at the Post-Default Rate.

     

    (c)  The
      Applicable Margin for (i) LIBOR Loans and for LIBOR Floating Rate Loans shall
      be
      two hundred twenty-five (225) basis points per annum, and (ii) Base Rate Loans
      shall be zero (0) basis points per annum unless and until a change is required
      by the operation of Section
      2.4.2(d).

     

    (d)  Changes
      in the Applicable Margin for LIBOR Loans and LIBOR Floating Rate Loans only
      shall be made not more frequently than quarterly based on the average Excess
      Availability for the preceding fiscal quarter, determined by the Agent in the
      exercise of its sole and absolute discretion, except that the first such
      determination shall be made based on the Borrower’s fiscal quarter ending
      December 31, 2006 and shall be effective as of the first day of the first month
      after the quarter of determination. The Applicable Margin (expressed as basis
      points) shall vary depending upon the Borrower’s Excess Availability, as
      follows:

     

    
      	
               

              Excess
                Availability

               

            	
               

              Applicable
                Margin for LIBOR Loans and LIBOR Floating Rate Loans (expressed as
                basis
                points)

               

            

    

     

    
       

      
        
          
          

        

        
          -37-

          
          

        

        
          
          
 

      

    

    
      	
               

              Less
                than $2,000,000

               

            	
               

              250

               

            
	
               

              Greater
                than or equal to $2,000,000 but less than $3,000,000

               

            	
               

              225

               

            
	
               

              Greater
                than or equal to $3,000,000 but less than $4,000,000

               

            	
               

              200

               

            
	
               

              Greater
                than or equal to $4,000,000

               

            	
               

              175

               

            

    

     

    2.4.3  Selection
      of Interest Rates.

     

    The
      provisions of this Section 2.4.3
      (Selection of Interest Rates) apply only to the Revolving Loan.

     

    (a)  The
      Borrower may select the initial Applicable Interest Rate or Applicable Interest
      Rates to be charged on the Loans.

     

    (b)  From
      time
      to time after the date of this Agreement as provided in this Section, by a
      proper and timely Interest Rate Election Notice furnished to the Agent in
      accordance with the provisions of Section
      2.4.3(e),
      the
      Borrower may select an initial Applicable Interest Rate or Applicable Interest
      Rates for any Loans or may convert the Applicable Interest Rate and, when
      applicable, the Interest Period, for any existing Loan to any other Applicable
      Interest Rate or, when applicable, any other Interest Period.

     

    (c)  The
      Borrower’s selection of an Applicable Interest Rate and/or an Interest Period,
      the Borrower’s election to convert an Applicable Interest Rate and/or an
      Interest Period to another Applicable Interest Rate or Interest Period, and
      any
      other adjustments in an interest rate are subject to the following
      limitations:

     

    (i)  the
      Borrower shall not at any time select or change to an Interest Period that
      extends beyond the Revolving Credit Expiration Date;

     

    (ii)  except
      as
      otherwise provided in Section
      2.4.5
      (Indemnity), no change from the LIBOR Rate to the Base Rate shall become
      effective on a day other than a Business Day and on a day which is the last
      day
      of then current Interest Period, no change of an Interest Period shall become
      effective on a day other than the last day of then current Interest Period,
      and
      no change from the Base Rate to the LIBOR Rate shall become effective on a
      day
      other than a day which is a LIBOR Business Day;

     

    (iii)  any
      Applicable Interest Rate change for any Loan to be effective on a date on which
      any principal payment on account of such Loan is scheduled to be paid shall
      be
      made only after such payment shall have been made;

     

    
       

      
        
          
          

        

        
          -38-

          
          

        

        
          
          

        

      

    

    (iv)  no
      more
      than three (3) different LIBOR Rates may be outstanding at any time and from
      time to time with respect to the Revolving Loan;

     

    (v)  the
      first
      day of each Interest Period shall be a LIBOR Business Day;

     

    (vi)  as
      of the
      effective date of a selection, there shall not exist an Event of Default;
      and

     

    (vii)  the
      minimum principal amount of a LIBOR Loan shall be Two Million Dollars
      ($2,000,000), plus integral increments of One Hundred Thousand Dollars
      ($100,000).

     

    (d)  If
      a
      request for an advance under the Loans is not accompanied by an Interest Rate
      Election Notice or does not otherwise include a selection of an Applicable
      Interest Rate and, if applicable, an Interest Period, or if, after having made
      a
      selection of an Applicable Interest Rate and, if applicable, an Interest Period,
      the Borrower fails or is not otherwise entitled under the provisions of this
      Agreement to continue such Applicable Interest Rate or Interest Period, the
      Borrower shall be deemed to have selected the Base Rate as the Applicable
      Interest Rate until such time as the Borrower has selected a different
      Applicable Interest Rate and specified an Interest Period in accordance with,
      and subject to, the provisions of this Section.

     

    (e)  The
      Lenders will not be obligated to make Loans, to convert the Applicable Interest
      Rate on Loans to another Applicable Interest Rate, or to change Interest
      Periods, unless the Agent shall have received an irrevocable written or
      telephonic notice (an “Interest
      Rate Election Notice”)
      from
      the Borrower specifying the following information:

     

    (i)  the
      amount to be borrowed or converted;

     

    (ii)  a
      selection of the Floating LIBOR Rate, the Base Rate or the LIBOR
      Rate;

     

    (iii)  the
      length of the Interest Period if the Applicable Interest Rate selected is the
      LIBOR Rate; and

     

    (iv)  the
      requested date on which such election is to be effective.

     

    Any
      telephonic notice must be confirmed in writing within three (3) Business Days.
      Each Interest Rate Election Notice must be received by the Agent not later
      than
      10:00 a.m. (Baltimore City time) on the Business Day of any requested borrowing
      or conversion in the case of a selection of the Base Rate or of the Floating
      LIBOR Rate and not later than 10:00 a.m. (Baltimore City time) on the third
      Business Day before the effective date of any requested borrowing or conversion
      in the case of a selection of the LIBOR Rate.

     

    
       

      
        
          
          

        

        
          -39-

          
          

        

        
          
          

        

      

    

    2.4.4  Inability
      to Determine LIBOR Base Rate.

     

    In
      the
      event that (a) the Agent shall have determined that, by reason of circumstances
      affecting the London interbank eurodollar market, adequate and reasonable means
      do not exist for ascertaining the LIBOR Base Rate for any requested Interest
      Period with respect to a Loan the Borrower have requested to be made as or
      to be
      converted to a LIBOR Loan or (b) the Agent shall determine that the LIBOR Base
      Rate for any requested Interest Period with respect to a Loan the Borrower
      have
      requested to be made as or to be converted to a LIBOR Loan does not adequately
      and fairly reflect the cost to the Lenders of funding or converting such Loan,
      the Agent shall give telephonic or written notice of such determination to
      the
      Borrower at least one (1) day prior to the proposed date for funding or
      converting such Loan. If such notice is given, any request for a LIBOR Loan
      shall be made as or converted to a Base Rate Loan. Until such notice has been
      withdrawn by the Agent the Borrower will not request that any Loan be made
      as or
      converted to a LIBOR Loan.

     

    Further,
      if such notice has been given, LIBOR Floating Loans shall be made as or
      converted to a Loan that bears interest at the Prime Rate plus an Applicable
      Margin that the Agent determines in good faith would provide a rate of interest
      substantially equivalent to the LIBOR Floating Rate. Until such notice has
      been
      withdrawn by the Agent the Borrower will not request that any Loan be made
      as or
      converted to a LIBOR Floating Loan.

     

    2.4.5  Indemnity.

     

    The
      Borrower agree to indemnify and reimburse the Agent and the Lenders and to
      hold
      the Agent and the Lenders harmless from any loss, cost (including administrative
      costs) or expense which any one or more of the Agent or the Lenders may sustain
      or incur as a consequence of (a) a default by the Borrower in payment when
      due
      of the principal amount of or interest on any LIBOR Loan, (b) the failure of
      the
      Borrower to make, or convert the Applicable Interest Rate of, a Loan after
      the
      Borrower has given a Loan Notice or an Interest Rate Election Notice, (c) the
      failure of the Borrower to make any prepayment of a LIBOR Loan after the
      Borrower have given notice of such intention to make such a prepayment, and/or
      (d) the making by the Borrower of a prepayment of a LIBOR Loan on a day which
      is
      not the last day of the Interest Period for such LIBOR Loan, calculated as
      provided in the following paragraph including, without limitation, any such
      loss
      or expense arising from the reemployment of funds obtained by the Lenders to
      maintain any LIBOR Loan or from fees payable to terminate the deposits from
      which such funds were obtained. This agreement and covenant of the Borrower
      shall survive termination or expiration of this Agreement and payment of the
      other Obligations.

     

    2.4.6  Payment
      of Interest.

     

    (a)  Unpaid
      and accrued interest on any portion of the Loans which consists of a Base Rate
      Loan shall be paid monthly, in arrears, on the first day of each calendar month,
      commencing on the first such date after the date of this Agreement, and on
      the
      first day of each calendar month thereafter, and at maturity (whether by
      acceleration, declaration, extension or otherwise).

     

    (b)  Notwithstanding
      the foregoing, any and all unpaid and accrued interest on any Base Rate Loan
      converted to a LIBOR Loan or prepaid shall be paid immediately upon such
      conversion and/or prepayment, as appropriate.

    
       

      
        
          
          

        

        
          -40-

          
          

        

        
          
          

        

      

    

     

    (c)  Unpaid
      and accrued interest on any LIBOR Loan shall be paid on the last Business Day
      of
      each Interest Period for such LIBOR Loan, at maturity (whether by acceleration,
      declaration, extension or otherwise), and, in the case of an Interest Period
      of
      six (6) months, every three (3) months; provided, however that any and all
      unpaid and accrued interest on any LIBOR Loan prepaid prior to expiration of
      then current Interest Period for such LIBOR Loan shall be paid immediately
      upon
      prepayment.

     

    Section
      2.5  General
      Financing Provisions.

     

    2.5.1  Borrower’s
      Representatives.

     

    The
      Borrower hereby irrevocably authorizes each of the Lenders to make Loans
      pursuant to the provisions of this Agreement upon the written, oral or telephone
      request of any one or more of the Persons who is from time to time a Responsible
      Officer of the Borrower under the provisions of the most recent certificate
      of
      corporate resolutions and/or incumbency of the Borrower on file with the Agent.
      Neither the Agent nor any of the Lenders assumes any responsibility or liability
      for any errors, mistakes, and/or discrepancies in the oral, telephonic, written
      or other transmissions of any instructions, orders, requests and confirmations
      between the Agent and the Borrower or the Agent and any of the Lenders in
      connection with the Credit Facilities, any Loan, any Revolver Usage or any
      other
      transaction in connection with the provisions of this Agreement.

     

    2.5.2  Use
      of
      Proceeds of the Loans.

     

    The
      proceeds of each advance under the Loans shall be used by the Borrower for
      Permitted Uses, and for no other purposes except as may otherwise be agreed
      by
      the Lenders in writing. The Borrower shall use the proceeds of the Loans
      promptly.

     

    2.5.3  Payments
      by Borrower.

     

    (a)  All
      payments of the Obligations, including, without limitation, principal, interest,
      Prepayments, and Fees, shall be paid by the Borrower without setoff or
      counterclaim to the Agent (except as otherwise provided herein) at the Agent’s
      office specified in Section
      9.1
      (Notices) in immediately available funds not later than 12 p.m. noon (Baltimore
      City Time) on the due date of such payment. All payments received by the Agent
      after such time shall be deemed to have been received by the Agent for purposes
      of computing interest and Fees and otherwise as of the next Business Day.
      Payments shall not be considered received by the Agent until such payments
      are
      paid to the Agent in immediately available funds. 

     

    (b)  Unless
      the Agent shall have received notice from the Borrower prior to the date on
      which any payment is due to the Agent that the Borrower will not make such
      payment in full, the Agent may assume that the Borrower has made such payment
      in
      full to the Agent on such date and the Agent in its sole discretion may, in
      reliance upon such assumption, cause to be distributed to each Lender on such
      due date an amount equal to the amount then due such Lender. If and to the
      extent the Borrower shall not have so made such payment in full to the Agent
      and
      the Agent shall have distributed to any Lender all or any portion of such
      amount, such Lender shall repay to the Agent on demand the amount so distributed
      to such Lender, together with interest thereon at the Federal Funds Rate for
      the
      first three (3) days from and after the date such amount is distributed to
      such
      Lender and thereafter at the Base Rate applicable to the Revolving Loans, until
      the date such Lender repays such amount to the Agent. 

     

    
       

      
        
          
          

        

        
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    2.5.4  Bank
      Products.

     

    The
      Borrower may request, and the Agent or its affiliates may, in their sole and
      absolute discretion, provide, Bank Products although the Borrower is not
      required to do so. In the event the Borrower requests Agent and/or its
      affiliates to procure or provide Bank Products, then the Borrower agrees with
      the Agent and/or such affiliates, as applicable, to pay when due all
      indebtedness, liabilities and obligations with respect to Bank Products and
      further agrees to indemnify and hold the Agent and/or such affiliates harmless
      from any and all indebtedness, liabilities, obligations, losses, costs and
      expenses (including, without limitation, reasonable attorneys fees) now or
      hereafter owing to or incurred by the Agent (including, without limitation,
      those under agreements of indemnifications or assurances provided by the Agent
      to its affiliates) and/or its affiliates with respect to Bank Products, all
      as
      the same may arise. In the event the Borrower shall not have paid to the Agent
      and/or its affiliates such amounts, the Agent may cover such amounts by an
      advance under the Revolving Loan, which advance shall be deemed to have been
      requested by the Borrower. The Borrower acknowledges and agrees that (a) all
      indebtedness, liabilities and obligations with respect to Bank Products provided
      by the Agent or its affiliates, and all of its agreements under this Section,
      are part of the Obligations secured by the Collateral, and (b) the obtaining
      of
      Bank Products from the Agent or its affiliates (i) is in the sole and absolute
      discretion of the Agent or its affiliates and (ii) is subject to all rules
      and
      regulations of the Agent or its affiliates.

     

    2.5.5  Joint
      and Several Liability.

     

    Each
      Borrower shall be liable for all amounts due to the Agent and/or any Lender
      under this Agreement, regardless of which Borrower actually receives Loans
      or
      other extensions of credit hereunder or the amount of such Loans received or
      the
      manner in which the Agent and/or such Lender
      accounts
      for such Loans or other extensions of credit on its books and records. The
      Borrower’s Obligations with respect to Loans made to it, and the Borrower’s
      Obligations arising as a result of the joint and several liability of the
      Borrower hereunder, with respect to Loans made to the other Borrower hereunder,
      shall be separate and distinct obligations, but all such Obligations shall
      be
      primary obligations of the Borrower.

     

    2.5.6  Contribution
      and Indemnification among the Borrowers.

     

    Each
      Borrower is obligated to repay the Obligations as joint and several obligors
      under this Agreement. To the extent that any Borrower shall, under this
      Agreement as a joint and several obligor, repay any of the Obligations
      constituting Loans made to another Borrower hereunder or other Obligations
      incurred directly and primarily by any other Borrower (an “Accommodation
      Payment”), then the Borrower making such Accommodation Payment shall be entitled
      to contribution and indemnification from, and be reimbursed by, each of the
      other Borrowers in an amount, for each of such other Borrowers, equal to a
      fraction of such Accommodation Payment, the numerator of which fraction is
      such
      other Borrower’s “Allocable Amount” (as defined below) and the denominator of
      which is the sum of the Allocable Amounts of all of the Borrowers. As of any
      date of determination, the “Allocable Amount” of each Borrower shall be equal to
      the maximum amount of liability for Accommodation Payments which could be
      asserted against such Borrower hereunder without (a) rendering such Borrower
      “insolvent” within the meaning of Section 101 (31) of the Bankruptcy Code,
      Section 2 of the Uniform Fraudulent Transfer Act (“UFTA”) or Section 2 of the
      Uniform Fraudulent Conveyance Act (“UFCA”), (b) leaving such Borrower with
      unreasonably small capital or assets, within the meaning of Section 548 of
      the
      Bankruptcy Code, Section 4 of the UFTA, or Section 5 of the UFCA, or (c) leaving
      such Borrower unable to pay its debts as they become due within the meaning
      of
      Section 548 of the Bankruptcy Code or Section 4 of the UFTA, or Section 5 of
      the
      UFCA. All rights and claims of contribution, indemnification and reimbursement
      under this section shall be subordinate in right of payment to the prior payment
      in full of the Obligations. The provisions of this section shall, to the extent
      expressly inconsistent with any provision in any Loan Document, supersede such
      inconsistent provision.

     

    
       

      
        
          
          

        

        
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    2.5.7  Agency
      of
Payments
      Inc.

     

    Each
      of
      the other Borrowers appoints Payments Inc. as its administrative agent for
      all
      purposes relevant to this Agreement, including (without limitation) the giving
      and receipt of notices and execution and delivery of all documents, instruments
      and certificates contemplated herein and all modifications hereto. Any
      acknowledgement, consent, direction, certification or other action which might
      otherwise be valid or effective only if given or taken by all of the Borrowers
      or acting singly, shall be valid and effective if given or taken only by
      Payments Inc., whether or not the other Borrower joins therein.

     

    Section
      2.6  Funding
      of Advances.

     

    2.6.1  Advances
      by Lenders.

     

    Unless
      the Agent elects, in the exercise of its discretion from time to time, to have
      one of the other provisions of this Section
      2.6
      (Funding
      of Advances) apply, upon the Agent’s receipt of a Loan Notice, the Agent shall
      promptly notify each Lender of the amount of each Advance to be made by such
      Lender on the requested borrowing date under such Lender’s Revolving Credit
      Commitment. Not later than 1:00 p.m. (Baltimore City Time) on each requested
      borrowing date for the making of Advances, each Lender shall, if it has received
      timely notice from the Agent of the Borrower’s request for such Advances, make
      available to the Agent, in funds immediately available to the Agent at the
      Agent’s office set forth in Section
      9.1
      (Notices), such Lender’s Revolving Credit Pro Rata Share of the Advances to be
      made on such date.

     

    2.6.2  M&T
      Advances.

     

    Between
      Settlement Dates, the Agent may request and M&T may (but shall not be
      obligated to) advance to the Borrower out of M&T’s own funds, the entire
      principal amount of any Advance requested or deemed requested pursuant to
Section
      2.1.2
      (Procedure for Making Advances Under the Revolving Loan) (any such Advance
      being
      referred to as a “M&T
      Loan”).
      The
      making of each M&T Loan by M&T shall be deemed to be a purchase by
      M&T of a 100% participation in each other Lender’s Revolving Credit Pro Rata
      Share of the amount of such M&T Loan. All payments of principal, interest
      and any other amount with respect to such M&T Loan shall be payable to and
      received by the Agent for the account of M&T. Upon demand by M&T, with
      notice to the Agent, each other Lender shall pay to M&T, as the repurchase
      of such participation, an amount equal to 100% of such Lender’s Revolving Credit
      Pro Rata Share of the principal amount of such M&T Loan. Any payments
      received by the Agent between Settlement Dates that in accordance with the
      terms
      of this Agreement are to be applied to the reduction of the outstanding
      principal balance of Revolving Loan, shall be paid over to and retained by
      M&T for such application, and such payment to and retention by M&T shall
      be deemed, to the extent of each other Lender’s Revolving Credit Pro Rata Share
      of such payment, to be a purchase by each such other Lender of a participation
      in the Advance (including the repurchase of participations in M&T Loans)
      made by M&T. Upon demand by another Lender, with notice thereof to the
      Agent, M&T shall pay to the Agent, for the account of such other Lender, as
      a repurchase of such participation, an amount equal to such other Lender’s
      Revolving Credit Pro Rata Share of any such amounts (after application thereof
      to the repurchase of any participations of M&T in such other Lender’s
      Revolving Credit Pro Rata Share of any M&T Loans) paid only to M&T by
      the Agent.

    
       

      
        
          
          

        

        
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    2.6.3  Agent
      Advances.

     

    (a)  Subject
      to the limitations set forth in the provisos contained in this Section
      2.6.3,
      the
      Agent is hereby authorized by the Lenders and the Borrower, from time to time
      in
      the Agent’s sole discretion, (i) after the occurrence of a Default or an Event
      of Default or (ii) at any time that any of the other applicable conditions
      precedent set forth in ARTICLE
      V
      (Conditions Precedent) have not been satisfied, to make Advances to the Borrower
      on behalf of the Lenders that the Agent, in its reasonable business judgment,
      deems necessary or desirable (A) to preserve or protect the Collateral, or
      any portion thereof, (B) to enhance the likelihood of, or maximize the
      amount of, repayment of the Loans and other Obligations, or (C) to pay any
      other amount chargeable to the Borrower pursuant to the terms of this Agreement,
      including, without limitation, Enforcement Costs (any of the Advances described
      in this Section
      2.6.3 being
      hereinafter referred to as “Agent
      Advances”);
      provided, that the Required Lenders may at any time revoke the Agent’s
      authorization contained in this Section
      2.6.3 to
      make Agent Advances, any such revocation to be in writing and to become
      effective prospectively upon the Agent’s receipt thereof; and provided further,
      that the Agent shall not make Agent Advances above that would cause the Revolver
      Usage otherwise permitted to be outstanding under this Agreement to exceed
      the
      lesser of the Total Revolving Credit Committed Amount or the Borrowing Base.
      Nothing in this Section
      2.6.3
      shall
      imply any limitation on the obligations of the Borrower to pay the Obligations
      including, without limitation, Enforcement Costs or on the obligations of the
      Lenders under Section
      9.19
      (Indemnification).

     

    (b)  The
      Agent
      Advances shall be repayable on demand and secured by the Collateral, shall
      constitute Advances and Obligations, and shall bear interest at the rate
      applicable to the Revolving Loan from time to time. The Agent shall notify
      each
      Lender in writing of each such Agent Advance.

     

    2.6.4  Overadvances. 

     

    (a)  Any
      contrary provision of this Agreement notwithstanding, the Lenders hereby
      authorize the Agent or M&T, as applicable, and the Agent or M&T, as
      applicable, may, but is not obligated to, knowingly and intentionally, continue
      to make Advances (including, without limitation, M&T Loans) to the Borrower
      notwithstanding that an Overadvance exists or thereby would be created, so
      long
      as (i) after giving effect to such Advances (including, without limitation,
      M&T Loans), the aggregate outstanding principal balance of the Revolving
      Loans does not exceed the amount of the Borrowing Base by more than 10% at
      the
      time the Overadvance is made, (ii) after giving effect to such Advances
      (including, without limitation, M&T Loans) the aggregate outstanding
      principal balance of the Revolving Loans does not exceed the Total Revolving
      Credit Committed Amount, and (iii) at the time of the making of any such Advance
      (including, without limitation, M&T Loans), the Agent does not believe, in
      good faith, that the Overadvance created by such Advance will be outstanding
      for
      more than ninety (90) days. The foregoing provisions are for the exclusive
      benefit of the Agent, M&T, and the Lenders and are not intended to benefit
      the Borrower in any way. The Advances and M&T Loans, as applicable, that are
      made pursuant to this Section
      2.6.4
      shall be
      subject to the same terms and conditions as any other Advance or M&T Loan,
      as applicable, except that they shall be Base Rate Loans.

     

    
       

      
        
          
          

        

        
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    (b)  In
      the
      event the Agent obtains actual knowledge that the Revolver Usage exceeds the
      amounts permitted by the preceding paragraph, regardless of the amount of,
      or
      reason for, such excess, the Agent shall notify Lenders as soon as practicable
      (and prior to making any (or any additional) intentional Overadvances (except
      for and excluding amounts charged to the Revolving Loan Account for interest,
      fees, or Enforcement Costs) unless the Agent determines that prior notice would
      result in imminent harm to the Collateral or its value), and the Lenders
      thereupon shall, together with the Agent, jointly determine the terms of
      arrangements that shall be implemented with the Borrower and intended to reduce,
      within a reasonable time, the outstanding principal amount of the Advances
      to
      the Borrower to an amount permitted by the preceding paragraph. In the event
      the
      Agent or any Lender disagrees over the terms of reduction or repayment of any
      Overadvance, the terms of reduction or repayment thereof shall be implemented
      according to the determination of the Required Lenders.

     

    (c)  Each
      Lender shall be obligated to settle with the Agent as provided in Section
      2.7.2
      (Revolving Loan Settlement) for the amount of such Lender’s Revolving Credit Pro
      Rata Share of any unintentional Overadvances by the Agent reported to such
      Lender, any intentional Overadvances made as permitted under this 2.6.4,
      and any
      Overadvances resulting from the charging to the Revolving Loan Account of
      interest, fees, Enforcement Costs or other amounts permitted by this
      Agreement.

     

    2.6.5  No
      Novation.

     

    The
      Borrower acknowledges and agrees that the Notes delivered on the date of this
      Agreement have been delivered in substitution for the Notes delivered under
      the
      terms of the Original Financing Agreement and that the execution and delivery
      of
      the Notes delivered on the date of this Agreement are not intended to and shall
      not cause a novation with respect to any or all of the Obligations.

     

    Section
      2.7  Settlement
      Among Lenders.

     

    2.7.1  Term
      Line Settlement.

     

    The
      Agent
      shall pay to each Lender on each Interest Payment Date or Term Line Installment
      Payment Date, as the case may be, such Lender’s ratable share of all payments
      received by the Agent in immediately available funds on account of the Term
      Lines, net of any amounts payable by such Lender to the Agent, by wire transfer
      of same day funds; the amount payable to each Lender shall be based on the
      principal amount of the Term Lines owing to such Lender.

     

    
       

      
        
          
          

        

        
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    2.7.2  Revolving
      Loan
      Settlement.

     

    It
      is
      agreed that each Lender’s funded portion of the Advances are intended by the
      Lenders to be equal at all times to such Lender’s Pro Rata Share of the
      aggregate outstanding principal amount of the Revolving Loan outstanding.
      Notwithstanding such agreement, the several and not joint obligation of each
      Lender to fund the Revolving Loan made in accordance with the terms of this
      Agreement ratably in accordance with such Lender’s Pro Rata Share and each
      Lender’s right to receive its ratable share of principal payments on the
      Revolving Loan in accordance with its Pro Rata Share, the Lenders agree (which
      agreement shall not be for the benefit of or enforceable by the Borrower) that
      in order to facilitate the administration of this Agreement and the Financing
      Documents that settlement among them may take place on a periodic basis in
      accordance with the provisions of this Section
      2.7.2.

     

    (a)  Selection
      of Settlement Dates. If the Agent elects, in its discretion, but subject to
      the
      consent of M&T, to settle accounts (“Settlement”)
      among
      the Lenders with respect to principal amounts of Revolving Loan less frequently
      than each Business Day, then the Agent shall designate periodic Settlement
      Dates
      that may occur on any Business Day after the Closing Date; provided, however,
      that the Agent shall designate as a Settlement Date any Business Day that is
      an
      Interest Payment Date; and provided further, that a Settlement Date shall occur
      at least once each week. The Agent shall designate a Settlement Date by
      delivering to each Lender a Settlement Report not later than 12:00 noon
      (Baltimore City Time) on the proposed Settlement Date, which Settlement Report
      shall be with respect to the period beginning on the immediately preceding
      Settlement Date and ending on such
      designated Settlement Date.

     

    (b)  In
      General. To the extent and in the manner hereinafter provided in this
Section
      2.7.2,
      Settlement among the Lenders as to the Revolving Loan may occur periodically
      on
      Settlement Dates determined from time to time by the Agent. Settlements may
      occur before or after the occurrence or during the continuance of a Default
      or
      Event of Default and whether or not all of the conditions set forth in
Section
      5.2
      (Conditions to All Extensions of Credit) have been met. On each Settlement
      Date
      payments shall be made by or to M&T, Agent and the other Lenders in
      accordance with the Settlement Report delivered by the Agent pursuant to the
      provisions of this Section
      2.7.2
      in
      respect of such Settlement Date so that as of each Settlement Date, and after
      giving effect to the transactions to take place on such Settlement Date, each
      Lender’s funded portion of the Advances shall equal such Lender’s Pro Rata Share
      of the Revolving Loan outstanding.

     

    (c)  Interim
      Collections. Between Settlement Dates, the Agent, to the extent no Agent
      Advances or M&T Loans are outstanding, may pay over to M&T any payments
      received by the Agent, which in accordance with the terms of this Agreement
      would be applied to the reduction of the Revolving Loans, for application to
      M&T’s other outstanding Revolving Loans. If, as of any Settlement Date,
      collections received since then immediately preceding Settlement Date have
      been
      applied to M&T’s other outstanding Revolving Loans other than to M&T
      Loans or Agent Advances, as provided for in the previous sentence, M&T shall
      pay to the Agent for the accounts of the Lenders, to be applied to the
      outstanding Revolving Loans of such Lenders, an amount such that each Lender
      shall, upon receipt of such amount, have, as of such Settlement Date, its Pro
      Rata Share of the Revolving Loans. During the period between Settlement Dates,
      M&T with respect to M&T Loans, the Agent with respect to Agent Advances,
      and each Lender with respect to the Revolving Loans other than M&T Loans and
      Agent Advances, shall be entitled to interest at the applicable rate or rates
      payable under this Agreement on the actual average daily amount of funds
      employed by M&T, the Agent and the other Lenders.

     

    
       

      
        
          
          

        

        
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    (d)  Return
      Payments. If any amounts received by M&T in respect of the Obligations are
      later required to be returned or repaid by M&T to the Borrower or any other
      obligor or their respective representatives or successors in interest, whether
      by court order, settlement or otherwise, in excess of the M&T’s Pro Rata
      Share of all such amounts required to be returned by all Lenders, each other
      Lender shall, upon demand by M&T with notice to the Agent, pay to the Agent
      for the account of M&T, an amount equal to the excess of such Lender’s Pro
      Rata Share of all such amounts required to be returned by all Lenders over
      the
      amount, if any, returned directly by such Lender.

     

    (e)  Payment
      by Lender. Payment by any Lender to the Agent shall be made not later than
      2:00
      p.m. (Baltimore City Time) on the Business Day such payment is due, provided
      that if such payment is due on demand by another Lender, such demand is made
      on
      the paying Lender not later than 12:00 p.m. noon (Baltimore City Time) on such
      Business Day. Payment by the Agent to any Lender shall be made by wire transfer,
      promptly following the Agent’s receipt of funds for the account of such Lender
      and in the type of funds received by the Agent, provided that if the Agent
      receives such funds at or prior to 12:00 p.m. noon (Baltimore City Time), the
      Agent shall pay such funds to such Lender on such Business Day. If a demand
      for
      payment is made after the applicable time set forth above, the payment due
      shall
      be made on the first Business Day following the date of such
      demand.

     

    2.7.3  Settlement
      of Other Obligations.

     

    All
      other
      amounts received by the Agent on account of, or applied by the Agent to the
      payment of, any Obligation owed to the Lenders (including, without limitation,
      Fees payable to the Lenders and proceeds from the sale of, or other realization
      upon, all or any part of the Collateral following an Event of Default) that
      are
      received by the Agent not later than 11:00 a.m. (Baltimore City Time) on a
      Business Day will be paid by the Agent to each Lender on the same Business
      Day,
      and any such amounts that are received by the Agent after 11:00 a.m. (Baltimore
      City Time) will be paid by the Agent to each Lender on the following Business
      Day. Unless otherwise stated herein, the Agent shall distribute Fees payable
      to
      the Lenders ratably to the Lenders based on each Lender’s Revolving Credit Pro
      Rata Share and shall distribute proceeds from the sale of, or other realization
      upon, all or any part of the Collateral following an Event of Default ratably
      to
      the Lenders based on the amount of the Obligations then owing to each
      Lender.

     

    2.7.4  Presumption
      of Payment.

     

    (a)  Unless
      the Agent shall have received notice from a Lender prior to 12:00 p.m. noon
      (Baltimore City Time) on the date of the requested date for the making of
      Advances that such Lender will not make available to the Agent, such Lender’s
      Revolving Credit Pro Rata Share of the Advances to be made on such date, the
      Agent may assume that such Lender has made such amount available to the Agent
      on
      such date in accordance with this Section
      2.7.4
      (Presumption of Payment), and the Agent, in its sole discretion may, in reliance
      upon such assumption, make available to the Borrower on such date a
      corresponding amount on behalf of such Lender. 

     

    
       

      
        
          
          

        

        
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    (b)  If
      and to
      the extent such Lender shall not have so made available to the Agent its
      Revolving Credit Pro Rata Share of the Advances made on such date, and the
      Agent
      shall have so made available to the Borrower a corresponding amount on behalf
      of
      such Lender, such Lender shall, on demand, pay to the Agent such corresponding
      amount, together with interest thereon, at the Federal Funds Rate for the first
      three (3) days from and after the date such corresponding amount shall have
      been
      so available by the Agent to the Borrower and thereafter at the Base Rate
      applicable to the Revolving Loans, until the date such amount shall have been
      repaid to the Agent. Such Lender shall not be entitled to payment of any
      interest that accrues on the amount made available by the Agent to the Borrower
      for the account of such Lender until such time as such Lender reimburses the
      Agent for such amount, together with interest thereon, as provided in this
      Section
      2.7.4.
      The
      failure of any Lender to make any Advance shall not relieve any other Lender
      of
      any obligation hereunder to make an Advance, but no Lender shall be responsible
      for the failure of any other Lender to make the Advance.

     

    (c)  A
      certificate of the Agent submitted to any Lender with respect to any amounts
      owing to the Agent by such Lender under this Section
      2.7.4
      shall be
      conclusive and binding on such Lender, absent manifest error. If such Lender
      does not pay such amounts to the Agent promptly upon the Agent’s demand, the
      Agent shall promptly notify the Borrower of such Lender’s failure to make
      payment, and the Borrower shall immediately repay such amounts to the Agent,
      together with accrued interest thereon at the applicable rate on the Revolving
      Loan, all without prejudice to the rights and remedies of the Agent against
      any
      defaulting Lender. Any and all amounts due and payable to the Agent by the
      Borrower under this Section
      2.7.4
      constitute and shall be part of the Agent’s Obligations.

     

    (d)  
      The
      Agent shall not be obligated to transfer to a Defaulting Lender any payments
      made by the Borrower to the Agent. In such event, the Agent may, but shall
      not
      be required to, retain payments that would otherwise be made to such Lender
      hereunder, apply such payments to such Lender’s defaulted obligations hereunder,
      transfer any such payments to each other non-Defaulting Lenders ratably in
      accordance with their Commitments (but only to the extent that such Defaulting
      Lender’s Advance was funded by the other Lenders), hold and re-lend to the
      Borrower for the account of such Defaulting Lender the amount of all such
      payments received and retained by it for the account of such Defaulting Lender,
      and take such other action as the Agent may deem to be appropriate, all at
      such
      time, and in such order, as the Agent may elect in its sole discretion exercised
      from time to time. Solely for the purposes of voting or consenting to matters
      with respect to the Financing Documents, such Defaulting Lender shall be deemed
      not to be a “Lender”
and
      such Lender’s Commitment shall be deemed to be zero. This Section shall remain
      effective with respect to such Lender until (x) the Obligations under this
      Agreement shall have been declared or shall have become immediately due and
      payable, (y) the non-Defaulting Lenders, the Agent, and the Borrower shall
      have
      waived such Defaulting Lender’s default in writing, or (z) the Defaulting Lender
      makes its Revolving Credit Pro Rata Share of the applicable Advance and pays
      to
      the Agent all amounts owing by Defaulting Lender in respect thereof. The
      operation of this Section
      2.7.4
      (Presumption of Payment) shall not be construed to increase or otherwise affect
      the Commitment of any Lender, to relieve or excuse the performance by such
      Defaulting Lender or any other Lender of its duties and obligations hereunder,
      or to relieve or excuse the performance by the Borrower of its duties and
      obligations hereunder to the Agent or to the Lenders other than such Defaulting
      Lender. Any such failure to fund by any Defaulting Lender shall constitute
      a
      material breach by such Defaulting Lender of this Agreement and shall entitle
      the Borrower at its option, upon written notice to the Agent, to arrange for
      a
      substitute Lender to assume the Commitment of such Defaulting Lender, such
      substitute Lender to be acceptable to the Agent. In connection with the
      arrangement of such a substitute Lender, the Defaulting Lender shall have no
      right to refuse to be replaced hereunder, and agrees to execute and deliver
      a
      completed form of Assignment and Acceptance Agreement in favor of the substitute
      Lender (and agrees that it shall be deemed to have executed and delivered such
      document if it fails to do so) subject only to being repaid its share of the
      outstanding Obligations without any premium or penalty of any kind whatsoever;
      provided further, however, that any such assumption of the Commitment of such
      Defaulting Lender shall not be deemed to constitute a waiver of any of the
      Agent’s, other Lenders’ or the Borrower’s rights or remedies against any such
      Defaulting Lender arising out of or in relation to such failure to
      fund.

     

    
       

      
        
          
          

        

        
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    ARTICLE
      III

    THE
      COLLATERAL

     

    Section
      3.1  Debt
      and Obligations Secured.

     

    All
      property and Liens assigned, pledged or otherwise granted under or in connection
      with this Agreement (including, without limitation, those under Section
      3.2
      (Grant
      of Liens)) or any of the Financing Documents shall secure (a) the payment of
      all
      of the Obligations, including, without limitation, all Revolver Usage and any
      and all Agent’s Obligations, and (b) the performance, compliance with and
      observance by the Borrower of the provisions of this Agreement and all of the
      other Financing Documents or otherwise under the Obligations. The security
      interest and Lien of each Lender in such property shall rank equally in priority
      with the interest of each other Lender, but the security interest and Lien
      of
      the Agent with respect to the Agent’s Obligations shall be superior and
      paramount to the security interest and Lien of the Lenders.

     

    Section
      3.2  Grant
      of Liens.

     

    The
      Borrower hereby assigns, pledges and grants to the Agent, for the ratable
      benefit of the Lenders and for the benefit of the Agent with respect to the
      Agent’s Obligations, and agrees that the Agent and the Lenders shall have a
      perfected and continuing security interest in, and Lien on the following
      property of the Borrower, all whether now owned or existing or hereafter
      acquired or arising wherever situated: all of the Borrower’s Receivables,
      inventory, chattel paper, documents, instruments, Equipment, investment
      property, and General Intangibles; all of the Borrower’s deposit accounts with
      any financial institution with which the Borrower maintains deposits; all
      insurance policies covering the foregoing and the right to receive refunds
      of
      unearned insurance premiums under those policies; all books and records in
      whatever media (paper, electronic or otherwise) recorded or stored, with respect
      to the foregoing and all Equipment and General Intangibles necessary or
      beneficial to retain, access and/or process the information contained in those
      books and records; all of the personal property of the Borrower, whether now
      owned or existing or hereafter acquired or created; and, and all of the
      Borrower’s other personal property of any kind or nature whatsoever, and all
      cash proceeds and noncash proceeds and products of the foregoing. The Borrower
      further agrees that the Agent, for the ratable benefit of the Lenders and for
      the benefit of the Agent with respect to the Agent’s Obligations, shall have in
      respect thereof all of the rights and remedies of a secured party under the
      Uniform Commercial Code as well as those provided in this Agreement, under
      each
      of the other Financing Documents and under applicable Laws.

     

    
       

      
        
          
          

        

        
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    Section
      3.3  Perfection
      Certificate.

     

    On
      or
      prior to the Closing Date, the Borrower shall deliver to the Agent a certificate
      in substantially the form attached to this Agreement as EXHIBIT B (the
“Perfection
      Certificate”)
      which
      shall contain such information with respect to the Borrower’s business and real
      and personal property as the Agent may require and shall be certified by a
      Responsible Officer of the Borrower, all in the form provided to the Borrower
      by
      the Agent and as revised in connection with Compliance Certificates from time
      to
      time.

     

    Section
      3.4  Personal
      Property.

     

    The
      Borrower acknowledges and agrees that it is the intention of the parties to
      this
      Agreement that the Agent, for the ratable benefit of the Lenders and for the
      benefit of the Agent with respect to the Agent’s Obligations, shall have a first
      priority, perfected Lien, in form and substance satisfactory to the Agent and
      its counsel, on all of the Borrower’s personal property of any kind and nature
      whatsoever, whether now owned or hereafter acquired, subject only to the
      Permitted Liens, if any. In furtherance of the foregoing:

     

    3.4.1  Promissory
      Notes, etc.

     

    Subject
      to the provisions of subsection (b) below, on the Closing Date and without
      implying any limitation on the scope of Section
      3.2
      (Grant
      of Liens), the Borrower shall deliver to the Agent (or the Servicer, to the
      extent so provided in the Servicing Agreement Assignment) all originals of
      all
      of Premium Finance Agreements, the Borrower’s letters of credit, instruments and
      other Collateral that may be perfected by possession and, if the Agent so
      requires, shall execute and deliver a separate pledge, assignment and security
      agreement in form and content acceptable to the Agent, which pledge, assignment
      and security agreement shall assign, pledge and grant a Lien to the Agent on
      all
      of the Borrower’s letters of credit, instruments and possessory Collateral. In
      the event that the Borrower shall acquire after the Closing Date any letters
      of
      credit or instruments and other possessory Collateral, the Borrower shall
      promptly so notify the Agent and deliver the originals of all of the foregoing
      to the Agent promptly and in any event within ten (10) days of each acquisition.
      All letters of credit, instruments and other possessory Collateral shall be
      delivered to the Agent endorsed and/or assigned as required by the pledge,
      assignment and security agreement and/or as the Agent may require and, if
      applicable, shall be accompanied by blank irrevocable and unconditional stock
      or
      bond powers.

     

    
      	3.4.2  	
              Patents,
                Copyrights and Other Property Requiring Additional Steps to
                Perfect.

            

    

     

    On
      the
      Closing Date and without implying any limitation on the scope of Section
      3.2
      (Grant
      of Liens), the Borrower shall execute and deliver all Financing Documents and
      on
      or after the Closing Date, as applicable, the Borrower take all actions
      requested by the Agent in order to perfect a first priority assignment of
      Patents, Copyrights, Trademarks, customer lists or any other type or kind of
      intellectual property acquired by the Borrower after the Closing
      Date.

     

    
       

      
        
          
          

        

        
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    Section
      3.5  Record
      Searches.

     

    As
      of the
      Closing Date and thereafter at the time any Financing Document is executed
      and
      delivered by the Borrower pursuant to this Section, the Agent shall have
      received, in form and substance satisfactory to the Agent, such Lien or record
      searches with respect to all of the Borrower and/or any other Person, as
      appropriate, and the property covered by such Financing Document showing that
      the Lien of such Financing Document will be a perfected first priority Lien
      on
      the property covered by such Financing Document subject only to Permitted Liens
      or to such other matters as the Agent may approve.

     

    Section
      3.6  Real
      Property.

     

    The
      Borrower acknowledges and agrees that it is the intention of the parties to
      this
      Agreement that the Agent, for the ratable benefit of the Lenders and for the
      benefit of the Agent with respect to the Agent’s Obligations, shall have a first
      priority, perfected Lien, in form and substance satisfactory to the Agent and
      its counsel, on all of the Borrower’s real property of any kind and nature
      whatsoever, whether now owned or hereafter acquired, subject only to the
      Permitted Liens, if any, although the Borrower at this time owns no real
      property. In furtherance of the foregoing:

     

    With
      respect to real property acquired by the Borrower after the Closing Date, the
      Borrower shall, promptly after acquisition thereof, grant a Lien covering such
      real property to the Agent, for the ratable benefit of the Lenders and for
      the
      benefit of the Agent with respect to the Agent’s Obligations, under the
      provisions of a mortgage, deed of trust or other document, as appropriate.
      Each
      Financing Document to be executed and delivered pursuant hereto
      shall:

     

    (a)  be
      in
      form and substance satisfactory to the Agent;

     

    (b)  create
      a
      first priority Lien in such real property in favor of the Agent, for the ratable
      benefit of the Lenders and for the benefit of the Agent with respect to the
      Agent’s Obligations, subject only to Permitted Liens, zoning ordinances, and
      such other matters as the Agent may approve;

     

    (c)  be
      accompanied by a current appraisal of the fair market value of the subject
      real
      property prepared by appraisers satisfactory to the Agent;

     

    (d)  be
      accompanied by a current survey satisfactory in all respects to the Agent of
      the
      subject real property, prepared by a registered land surveyor or engineer
      satisfactory to the Agent;

     

    (e)  be
      accompanied by evidence satisfactory to the Agent regarding the current and
      past
      pollution control practices at such real property in connection with the
      discharge, emission, handling, disposal or existence of Hazardous Materials,
      which may include, at the Agent’s request, an environmental audit of such real
      property prepared by a person or firm acceptable to the Agent;

    
       

      
        
          
          

        

        
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    (f)  be
      accompanied by a mortgagee’s title insurance policy or marked-up unconditional
      commitment or binder for such insurance in form and substance satisfactory
      to
      the Agent and issued by a title insurance company satisfactory to the Agent;
      and

     

    (g)  upon
      request of the Agent, be accompanied by a signed opinion of counsel addressed
      to
      the Agent and each of the Lenders, in form and substance satisfactory to the
      Agent, and from counsel, satisfactory to the Agent, licensed to practice in
      the
      state where the subject real property is located.

     

    Section
      3.7  Costs.

     

    The
      Borrower agrees to pay, as part of the Enforcement Costs and to the fullest
      extent permitted by applicable Laws, on demand all costs, fees and expenses
      incurred by the Agent and/or any of the Lenders in connection with the taking,
      perfection, preservation, protection and/or release of a Lien on the Collateral,
      including, without limitation:

     

    (a)  fees
      and
      expenses incurred by the Agent and/or any of the Lenders in preparing,
      reviewing, negotiating and finalizing the Financing Documents from time to
      time
      (including, without limitation, reasonable attorneys’ fees incurred in
      connection with preparing, reviewing, negotiating, and finalizing any of the
      Financing Documents, including, any amendments and supplements
      thereto);

     

    (b)  all
      filing and/or recording taxes or fees;

     

    (c)  all
      title
      insurance premiums and costs;

     

    (d)  all
      costs
      of Lien and record searches;

     

    (e)  reasonable
      attorneys’ fees in connection with all legal opinions required;

     

    (f)  appraisal
      and/or survey costs; and

     

    (g)  all
      related costs, fees and expenses.

     

    Section
      3.8  Release.

     

    Upon
      the
      indefeasible repayment in full in cash of the Obligations and performance of
      all
      Obligations of the Borrower and all obligations and liabilities of each other
      Person, other than the Agent and the Lenders, under this Agreement and all
      other
      Financing Documents, the termination and/or expiration of all of the
      Commitments, upon the Borrower’s request and at the Borrower’s sole cost and
      expense, the Agent shall release and/or terminate any Financing Document but
      only if and provided that there is no commitment or obligation (whether or
      not
      conditional) of the Agent and/or any of the Lenders to re-advance amounts that
      would be secured thereby.

     

    
       

      
        
          
          

        

        
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    Section
      3.9  Inconsistent
      Provisions.

     

    In
      the
      event that the provisions of any Financing Document directly conflict with
      any
      provision of this Agreement, the provisions of this Agreement
      govern.

     

    ARTICLE
      IV

    REPRESENTATIONS
      AND WARRANTIES

     

    Section
      4.1  Representations
      and Warranties.

     

    The
      Borrower represents and warrants to the Agent and the Lenders, as
      follows:

     

    4.1.1  Subsidiaries.

     

    The
      Borrower has
      no
      Subsidiaries except as noted on the Perfection Certificate. Each of the
      Subsidiaries is a Wholly Owned Subsidiary except as shown on the Perfection
      Certificate, which correctly indicates the nature and amount of the Borrower’s
      ownership interests therein. Each of the Subsidiaries (a) is a corporation
      duly
      organized, existing and in good standing under the laws of the jurisdiction
      of
      its incorporation, (b) has the corporate power to own its property and to carry
      on its business as now being conducted, and (c) is duly qualified to do business
      and is in good standing in each jurisdiction in which the character of the
      properties owned by it therein or in which the transaction of its business
      makes
      such qualification necessary..

     

    4.1.2  Good
      Standing.

     

    The
      Borrower (a) is a corporation duly organized, existing and in good standing
      under the laws of the jurisdiction of its incorporation stated in the Perfection
      Certificate and in no other jurisdiction, (b) has the corporate power to own
      its
      property and to carry on its business as now being conducted, and (c) is duly
      qualified to do business and is in good standing in each jurisdiction in which
      the character of the properties owned by it therein or in which the transaction
      of its business makes such qualification necessary.

     

    4.1.3  Power
      and Authority.

     

    The
      Borrower has full corporate power and authority to execute and deliver this
      Agreement, and the other Financing Documents to which it is a party, to make
      the
      borrowings under this Agreement and to incur and perform the Obligations whether
      under this Agreement, the other Financing Documents or otherwise, all of which
      have been duly authorized by all proper and necessary corporate action. No
      consent or approval of shareholders or any creditors of the Borrower, and no
      consent, approval, filing or registration with or notice to any Governmental
      Authority on the part of the Borrower, is required as a condition to the
      execution, delivery, validity or enforceability of this Agreement the other
      Financing Documents, or the performance by the Borrower of the
      Obligations.

     

    4.1.4  Binding
      Agreements.

     

    This
      Agreement and the other Financing Documents executed and delivered by the
      Borrower have been properly executed and delivered and constitute the valid
      and
      legally binding obligations of the Borrower and are fully enforceable against
      the Borrower in accordance with their respective terms, subject to bankruptcy,
      insolvency, reorganization, moratorium and other laws of general application
      affecting the rights and remedies of creditors and secured parties, and general
      principles of equity regardless of whether applied in a proceeding in equity
      or
      at law.

     

    
       

      
        
          
          

        

        
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    4.1.5  No
      Conflicts.

     

    Neither
      the execution, delivery and performance of the terms of this Agreement or of
      any
      of the other Financing Documents executed and delivered by the Borrower nor
      the
      consummation of the transactions contemplated by this Agreement will conflict
      with, violate or be prevented by (a) the Borrower’s charter or bylaws, (b) any
      existing mortgage, indenture, contract or agreement binding on the Borrower
      or
      affecting its property, or (c) any Laws.

     

    4.1.6  No
      Defaults, Violations.

     

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

     

    (b)  Neither
      the Borrower nor any of its Subsidiaries is in default under or with respect
      to
      any obligation under any existing mortgage, indenture, contract or agreement
      binding on it or affecting its property in any respect that could have a
      Material Adverse Effect.

     

    4.1.7  Compliance
      with Laws.

     

    Neither
      the Borrower nor any of its Subsidiaries is in violation of any applicable
      Laws
      (including, without limitation, any Laws relating to employment practices,
      to
      environmental, occupational and health standards and controls) or order, writ,
      injunction, decree or demand of any court, arbitrator, or any Governmental
      Authority affecting the Borrower or any of its properties, the violation of
      which, considered in the aggregate, could have a Material Adverse
      Effect.

     

    4.1.8  Margin
      Stock.

     

    None
      of
      the proceeds of the Loans will be used, directly or indirectly, by the Borrower
      or any Subsidiary for the purpose of purchasing or carrying, or for the purpose
      of reducing or retiring any indebtedness that was originally incurred to
      purchase or carry, any “margin stock” within the meaning of Regulation U (12 CFR
      Part 221), of the Board of Governors of the Federal Reserve System or for any
      other purpose that might make the transactions contemplated in this Agreement
      a
“purpose credit” within the meaning of Regulation U, or cause this Agreement to
      violate any other regulation of the Board of Governors of the Federal Reserve
      System or the Securities Exchange Act of 1934 or the Small Business Investment
      Act of 1958, as amended, or any rules or regulations promulgated under any
      of
      such statutes.

     

    4.1.9  Investment
      Company Act; Margin Securities.

     

    Neither
      the Borrower nor any of its Subsidiaries is an investment company within the
      meaning of the Investment Company Act of 1940, as amended, nor is it, directly
      or indirectly, controlled by or acting on behalf of any Person which is an
      investment company within the meaning of said Act. Neither the Borrower nor
      any
      of its Subsidiaries is engaged principally, or as one of its important
      activities, in the business of extending credit for the purpose of purchasing
      or
      carrying “margin stock” within the meaning of Regulation U (12 CFR Part 221), of
      the Board of Governors of the Federal Reserve System.

    
       

      
        
          
          

        

        
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    4.1.10  Litigation.

     

    Except
      as
      otherwise disclosed on Schedule
      4.1.10
      attached
      hereto and made a part hereof, there are no proceedings, actions or
      investigations pending or, so far as the Borrower knows, threatened before
      or by
      any court, arbitrator or any Governmental Authority that, in any one case or
      in
      the aggregate, if determined adversely to the interests of the Borrower or
      any
      Subsidiary, could reasonably be expected to have a Material Adverse Effect
      on
      the Borrower.

     

    4.1.11  Financial
      Condition.

     

    The
      financial statements of the Parent dated March 31, 2006, are complete and
      correct and fairly present the financial position of the Parent and its
      Subsidiaries and the results of its operations and transactions in its surplus
      accounts as of the date and for the period referred to and have been prepared
      in
      accordance with GAAP applied on a consistent basis throughout the period
      involved. The financial statements of the Payments dated May 31, 2006, are
      complete and correct and fairly present the financial position of the Borrower
      and the results of its operations and transactions in its surplus accounts.
      There are no liabilities, direct or indirect, fixed or contingent, of the Parent
      or its Subsidiaries or the Borrower as of the date of such financial statements
      that are not reflected therein or in the notes thereto. There has been no
      adverse change in the financial condition or operations of the Parent or its
      Subsidiaries or the Borrower since the date of such financial statements and
      to
      the Borrower’s knowledge no such adverse change is pending or threatened.
      Neither the Parent nor any of its Subsidiaries nor the Borrower has guaranteed
      the obligations of, or made any investment in or advances to, any Person, except
      as disclosed in such financial statements.

     

    4.1.12  Full
      Disclosure.

     

    The
      financial statements referred to in Section
      4.1.11
      (Financial Condition) of this Agreement, the Financing Documents (including,
      without limitation, this Agreement), and the statements, reports or certificates
      furnished by the Borrower in connection with the Financing Documents (a) do
      not
      contain any untrue statement of a material fact and (b) when taken in their
      entirety, do not omit any material fact necessary to make the statements
      contained therein not misleading. There is no fact known to the Borrower that
      the Borrower has not disclosed to the Agent and the Lenders in writing prior
      to
      the date of this Agreement with respect to the transactions contemplated by
      the
      Financing Documents that materially and adversely affects or in the future
      could, in the reasonable opinion of the Borrower materially adversely affect
      the
      condition, financial or otherwise, results of operations, business, or assets
      of
      the Borrower or of any Subsidiary.

     

    4.1.13  Indebtedness
      for Borrowed Money.

     

    Except
      for the Obligations and except as set forth in Schedule
      4.1.13
      attached
      hereto and made a part hereof, the Borrower has no Indebtedness for Borrowed
      Money. The Agent has received photocopies of all promissory notes evidencing
      any
      Indebtedness for Borrowed Money set forth in Schedule
      4.1.13,
      together with any and all subordination agreements, other agreements, documents,
      or instruments securing, evidencing, guarantying or otherwise executed and
      delivered in connection therewith.

     

    
       

      
        
          
          

        

        
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    4.1.14  Parent
      Subordinated Debt.

     

    None
      of
      the Parent Subordinated Debt Documents has been amended, supplemented, restated
      or otherwise modified except as otherwise disclosed to the Agent and the Lenders
      in writing on or before the effective date of any such amendment, supplement,
      restatement or other modification. In addition, there does not exist any default
      or any event that upon notice or lapse of time or both would constitute a
      default under the terms of any of the Parent Subordinated Debt
      Documents.

     

    4.1.15  Taxes.

     

    Each
      of
      the Borrower and its Subsidiaries has filed all returns, reports and forms
      for
      Taxes that, to the knowledge of the Borrower, are required to be filed, and
      has
      paid all Taxes as shown on such returns or on any assessment received by it,
      to
      the extent that such Taxes have become due, unless and to the extent only that
      such Taxes, assessments and governmental charges are currently contested in
      good
      faith and by appropriate proceedings by the Borrower, such Taxes are not the
      subject of any Liens other than Permitted Liens, and adequate reserves therefor
      have been established as required under GAAP. All tax liabilities of the
      Borrower were as of the date of audited financial statements referred to in
      Section
      4.1.11
      (Financial Condition), and are now, adequately provided for on the books of
      the
      Borrower or its Subsidiaries, as appropriate. No tax liability has been asserted
      by the Internal Revenue Service or any state or local authority against the
      Borrower for Taxes in excess of those already paid.

     

    4.1.16  ERISA.

     

    With
      respect to any Plan that is maintained or contributed to by the Borrower and/or
      by any ERISA Affiliate or as to which the Borrower retains material liability:
      (a) no “accumulated funding deficiency” as defined in Code §412 or ERISA §302
      has occurred, whether or not that accumulated funding deficiency has been
      waived; (b) no Reportable Event has occurred other than events for which
      reporting has been waived or that are unlikely to result in material liability
      for the Borrower; (c) no termination of any plan subject to Title IV of ERISA
      has occurred; (d) neither the Borrower nor any ERISA Affiliate has incurred
      a
“complete withdrawal” within the meaning of ERISA §4203 from any Multi-employer
      Plan that is likely to result in material liability for the Borrower; (e)
      neither the Borrower nor any ERISA Affiliate has incurred a “partial withdrawal”
within the meaning of ERISA §4205 with respect to any Multi-employer Plan that
      is likely to result in material liability for the Borrower; (f) no
      Multi-employer Plan to which the Borrower or any ERISA Affiliate has an
      obligation to contribute is to the knowledge of the Borrower, in
“reorganization” within the meaning of ERISA §4241 nor has notice been received
      by the Borrower or any ERISA Affiliate that such a Multi-employer Plan will
      be
      placed in “reorganization”.

     

    4.1.17  Title
      to Properties.

     

    The
      Borrower has good and marketable title to all of its properties, including,
      without limitation, the Collateral and the properties and assets reflected
      in
      the balance sheets described in Section
      4.1.11
      (Financial Condition). The Borrower has legal, enforceable and uncontested
      rights to use freely such property and assets. All of such properties
      (including, without limitation, the Collateral) that were purchased, were
      purchased for fair consideration and reasonably equivalent value in the ordinary
      course of business of both the seller and the Borrower and not, by way of
      example only, as part of a bulk sale.

     

    
       

      
        
          
          

        

        
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    4.1.18  Patents,
      Trademarks, Etc.

     

    Each
      of
      the Borrower or its Subsidiaries owns, possesses, or has the right to use all
      necessary Patents, licenses, Trademarks, Copyrights, permits and franchises
      to
      own its properties and to conduct its business as now conducted, without known
      conflict with the rights of any other Person. Any and all obligations to pay
      royalties or other charges with respect to such properties and assets are
      properly reflected on the financial statements described in Section
      4.1.11
      (Financial Condition).

     

    4.1.19  Premium
      Finance Licenses.

     

    (a)  Payments
      Inc. holds all Premium Finance Licenses and all other licenses, permits,
      approvals and authorizations required in connection with the conduct of its
      present and proposed business. All such Premium Finance Licenses and the like
      are (and shall remain) valid and in full force and effect. Each of Parent and
      its other Subsidiaries holds all licenses, permits, approvals and authorizations
      required in connection with the conduct of its present and proposed
      business

     

    (b)  EXHIBIT
      G
      sets forth a complete list and description of all Premium Finance Licenses
      required for the conduct of Payments Inc.’s business in the normal course. Each
      such Premium Finance License is validly issued and in full force and effect,
      and
      constitutes all of the authorization necessary for the operation of Payments
      Inc.’s business in the normal course. Complete and correct copies of the Premium
      Finance Licenses have been delivered to the Agent. No event has occurred which
      (i) permits, or after notice or lapse of time or both would permit, revocation,
      lapse or termination of any Premium Finance Licenses, or (ii) materially and
      adversely affects, or in the future would materially and adversely affect,
      any
      of the rights of Payments Inc. thereunder. No other license, permit, approval,
      authorization or franchise is required for the operation of Payments Inc.’s
      business. Payments Inc. has no reason to believe nor any knowledge that the
      Premium Finance Licenses listed and described on EXHIBIT G will not be renewed
      in the ordinary course. Payments Inc. has filed or will timely file all reports,
      applications, documents, instruments, and information required to be filed
      by it
      pursuant to applicable rules and regulations or requests of every regulatory
      body having jurisdiction over any of the Premium Finance Licenses.

     

    4.1.20  Employee
      Relations.

     

    Except
      as
      disclosed on Schedule
      4.1.20 attached
      hereto and made a part hereof, (a) neither the Borrower nor any Subsidiary
      thereof nor any of the Borrower’s or Subsidiary’s employees is subject to any
      collective bargaining agreement, (b) no petition for certification or union
      election is pending with respect to the employees of the Borrower or any
      Subsidiary and no union or collective bargaining unit has sought such
      certification or recognition with respect to the employees of the Borrower,
      (c)
      there are no strikes, slowdowns, work stoppages or controversies pending or,
      to
      the best knowledge of the Borrower after due inquiry, threatened between the
      Borrower and its employees, and (d) neither the Borrower nor any of its
      Subsidiaries is subject to an employment contract, severance agreement,
      commission contract, consulting agreement or bonus agreement. Hours worked
      and
      payments made to the employees of the Borrower have not been in violation of
      the
      Fair Labor Standards Act or any other applicable law dealing with such matters.
      All payments due from the Borrower or for which any claim may be made against
      the Borrower, on account of wages and employee and retiree health and welfare
      insurance and other benefits have been paid or accrued as a liability on its
      books. The consummation of the transactions contemplated by this Agreement
      or
      any of the other Financing Documents, will not give rise to a right of
      termination or right of renegotiation on the part of any union under any
      collective bargaining agreement to which the Borrower is a party or by which
      it
      is bound.

     

    
       

      
        
          
          

        

        
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    4.1.21  Presence
      of Hazardous Materials or Hazardous Materials Contamination.

     

    To
      the
      best of the Borrower’s knowledge, (a) no Hazardous Materials are located on any
      real property owned, controlled or operated by of the Borrower or for which
      the
      Borrower is, or is claimed to be, responsible, except for reasonable quantities
      of necessary supplies for use by the Borrower in the ordinary course of its
      current line of business and stored, used and disposed in accordance with
      applicable Laws; and (b) no property owned, controlled or operated by the
      Borrower or for which the Borrower has, or is claimed to have, responsibility
      has ever been used as a manufacturing, storage, or dump site for Hazardous
      Materials nor is affected by Hazardous Materials Contamination at any other
      property.

     

    4.1.22  Perfection
      and Priority of Collateral.

     

    The
      Agent
      and the Lenders have, or upon execution and recording of this Agreement and
      the
      Security Documents will have, and will continue to have as security for the
      Obligations, a valid and perfected Lien on and security interest in all
      Collateral, free of all other Liens, claims and rights of third parties
      whatsoever except Permitted Liens, including, without limitation, those
      described on Schedule
      4.1.22
      attached
      hereto and made a part hereof.

     

    4.1.23  Places
      of Business and Location of Collateral.

     

    The
      information contained in the Perfection Certificate is complete and correct.
      The
      Perfection Certificate completely and accurately identifies the address of
      (a)
      the state of organization of the Borrower, (b) the chief executive office of
      the
      Borrower, (c) any and each other place of business of the Borrower, (d) the
      location of all books and records pertaining to the Collateral, and (e) each
      location, other than the foregoing, where any of the Collateral is located.
      The
      proper and only places to file financing statements with respect to the
      Collateral within the meaning of the Uniform Commercial Code are the filing
      office for the jurisdiction in which the Borrower is organized and the local
      real property filing office for any location at which the Borrower has fixtures,
      all as identified on the Perfection Certificate.

     

    4.1.24  Business
      Information.

     

    In
      the
      five (5) years preceding the date hereof, the Borrower has not changed its
      name,
      state of organization, identity or organizational structure, has conducted
      business under any name other than its current name, and has conducted its
      business in any jurisdiction other than those disclosed on the Perfection
      Certificate.

    
       

      
        
          
          

        

        
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    4.1.25  Equipment.

     

    All
      Equipment is personalty and is not and will not be affixed to real estate in
      such manner as to become a fixture or part of such real estate. No equipment
      is
      held by the Borrower on a sale on approval basis.

     

    4.1.26  Receivables.

     

    With
      respect to all Receivables and to the best of the Borrower’s knowledge (a) they
      are genuine, and in all respects what they purport to be, and are not evidenced
      by a judgment, an instrument, or chattel paper (unless such judgment has been
      assigned and such instrument or chattel paper has been endorsed and delivered
      to
      the Agent for the benefit of the Lenders ratably and the Agent); (b) they
      represent bona fide transactions completed in accordance with the terms and
      provisions contained in the invoices, purchase orders and other contracts
      relating thereto, and the underlying transaction therefor is in accordance
      with
      all applicable Laws; (c) the amounts shown on the Borrower’s books and records,
      with respect thereto are actually and absolutely owing to the Borrower and
      are
      not contingent or subject to reduction for any reason other than regular
      discounts, credits or adjustments allowed by the Borrower in the ordinary course
      of its business; (d) no payments have been or shall be made thereon except
      payments turned over to the Agent by the Borrower; and (e) all Account Debtors
      thereon have the capacity to contract.

     

    4.1.27  Compliance
      with Eligibility Standards.

     

    Each
      Receivable included in the calculation of the Borrowing Base does and will
      at
      all times meet and comply with all of the standards for Eligible Receivables.
      With respect to those Receivable that the Agent has deemed Eligible Receivables
      (a) there are no facts, events or occurrences that in any way impair the
      validity, collectibility or enforceability thereof or tend to reduce the amount
      payable thereunder; and (b) there are no proceedings or actions known to the
      Borrower that are threatened or pending against any Account Debtor that might
      result in any material adverse change in the Borrowing Base.

     

    4.1.28  Original
      Financing Agreement.

     

    No
      Default or Event of Default (including, without limitation, those with respect
      to representations and warranties) existed under the Original Financing
      Agreement or under any of the other Financing Documents immediately before
      the
      execution and delivery of this Agreement.

     

    4.1.29  Solvency

     

    The
      Borrower is Solvent prior to and after giving effect to the making of the
      Loans.

     

    4.1.30  Subsidiary.

     

    AARD-VARK
      Agency, Ltd., a wholly-owned Subsidiary of Barry Scott Acquisition Corp., has
      been sold and neither the Parent nor any Subsidiary or Affiliate of the Parent
      retains any interest therein.

    
       

      
        
          
          

        

        
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    Section
      4.2  Survival;
      Updates of Representations and Warranties.

     

    All
      representations and warranties contained in or made under or in connection
      with
      this Agreement and the other Financing Documents shall survive the Closing
      Date,
      the making of any advance under the Loans and extension of credit made
      hereunder, and the incurring of any other Obligations and shall be deemed to
      have been made at the time of each request for, and again at the time of the
      making of, each advance under the Loans and Revolver Usage, except that the
      representations and warranties that relate to the financial statements that
      are
      referred to in Section
      4.1.11
      (Financial Condition), shall also be deemed to cover financial statements
      furnished from time to time to the Agent and the Lenders pursuant to
Section
      6.1.1
      (Financial Statements).

     

    ARTICLE
      V

    CONDITIONS
      PRECEDENT

     

    Section
      5.1  Conditions
      to the Initial Advance.

     

    The
      making of the initial Advance under the Revolving Loan, the initial Term Line
      advance, and other Revolver Usage on the Closing Date are subject to the
      fulfillment of the following conditions precedent in a manner satisfactory
      in
      form and substance to the Agent and its counsel:

     

    5.1.1  Organizational
      Documents - Borrower.

     

    The
      Agent
      shall have received with respect to the Borrower:

     

    (a)  a
      certificate of good standing certified by the Secretary of State, or other
      appropriate Governmental Authority, of the state of incorporation of the
      Borrower;

     

    (b)  a
      certified copy from the appropriate Governmental Authority under which the
      Borrower is organized, of the Borrower’s recorded articles of incorporation and
      all recorded amendments thereto;

     

    (c)  a
      certificate of qualification to do business for the Borrower certified by the
      Secretary of State or other Governmental Authority of each state in which the
      Borrower conducts business;

     

    (d)  a
      certificate dated as of the Closing Date by the Secretary or an Assistant
      Secretary of the Borrower covering:

     

    (i)  true
      and
      complete copies of the Borrower’s corporate charter, bylaws, and all amendments
      thereto;

     

    (ii)  true
      and
      complete copies of the resolutions of its Board of Directors authorizing (A)
      the
      execution, delivery and performance of the Financing Documents to which it
      is a
      party, (B) the borrowings hereunder, and (C) the granting of the Liens
      contemplated by this Agreement and the Financing Documents to which the Borrower
      is a party;

     

    
       

      
        
          
          

        

        
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    (iii)  the
      incumbency, authority and signatures of the officers of the Borrower authorized
      to sign this Agreement and the other Financing Documents to which the Borrower
      is a party; and

     

    (iv)  the
      identity of the Borrower’s current directors, common stock holders and other
      equity holders, as well as their respective percentage ownership
      interests.

     

    5.1.2  Opinion
      of Borrower’s Counsel.

     

    The
      Agent
      shall have received the favorable opinion of counsel for the Borrower addressed
      to the Agent and the Lenders in form satisfactory to the Agent.

     

    5.1.3  Organizational
      Documents - Corporate Guarantor.

     

    The
      Agent
      shall have received with respect to each of the Corporate
      Guarantors:

     

    (a)  a
      certificate of good standing certified by the Secretary of State, or other
      appropriate Governmental Authority, of the state of incorporation for the
      Corporate Guarantor;

     

    (b)  a
      certificate of qualification to do business certified by the Secretary of State
      or other Governmental Authority of each state in which the Corporate Guarantor
      conducts business;

     

    (c)  a
      certificate dated as of the Closing Date by the Secretary or an Assistant
      Secretary of the Corporate Guarantor covering:

     

    (i)  true
      and
      complete copies of the Corporate Guarantor’s corporate charter, bylaws, and all
      amendments thereto;

     

    (ii)  true
      and
      complete copies of the resolutions of the Board of Directors of the Corporate
      Guarantor authorizing the execution, delivery and performance of the Financing
      Documents to which the Corporate Guarantor is a party and the granting of the
      Liens contemplated by any of the Financing Documents to which the Corporate
      Guarantor is a party;

     

    (iii)  the
      incumbency, authority and signatures of the officers of the Corporate Guarantor
      authorized to sign its Corporate Guaranty and all other Financing Documents
      to
      which the Corporate Guarantor is a party;

     

    (iv)  the
      identity of the Corporate Guarantor’s current directors, common stock holders
      and other equity holders, as well as their respective percentage ownership
      interests;

     

    
       

      
        
          
          

        

        
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    (d)  the
      favorable opinion of counsel for the Corporate Guarantor addressed to the Agent
      and the Lenders and in form satisfactory to the Agent.

     

    5.1.4  Consents,
      Licenses, Approvals, Etc.

     

    The
      Agent
      shall have received copies of all consents, licenses and approvals, including
      all Premium Finance Licenses, required in connection with the execution,
      delivery, performance, validity and enforceability of the Financing Documents
      and continued operation of the Borrower’s business, and such consents, licenses
      and approvals, including the Premium Finance Licenses, shall be in full force
      and effect.

     

    5.1.5  Notes.

     

    The
      Agent
      shall have received for delivery to each of the Lenders the Revolving Credit
      Notes, each conforming to the requirements hereof and executed by a Responsible
      Officer of the Borrower and attested by a duly authorized representative of
      the
      Borrower.

     

    5.1.6  Financing
      Documents and Collateral.

     

    The
      Borrower shall have executed and delivered the Financing Documents to be
      executed by it, and shall have delivered original chattel paper, instruments,
      investment property, and related Collateral and all opinions, title insurance,
      and other documents contemplated by Article III (The Collateral).

     

    5.1.7  Other
      Financing Documents.

     

    In
      addition to the Financing Documents to be delivered by the Borrower, the Agent
      shall have received the Financing Documents duly executed and delivered by
      Persons other than the Borrower.

     

    5.1.8  Documents,
      Etc.

     

    The
      Agent
      shall have received such other certificates, opinions, documents and instruments
      confirmatory of or otherwise relating to the transactions contemplated hereby
      as
      may have been reasonably requested by the Agent.

     

    5.1.9  Payment
      of Fees.

     

    The
      Agent
      and the Lenders shall have received payment of any Fees due on or before the
      Closing Date.

     

    5.1.10  Perfection
      Certificate.

     

    The
      Borrower shall have delivered the Perfection Certificate required under the
      provisions of Section
      3.3
      (Perfection Certificate) duly executed by a Responsible Officer of the
      Borrower.

    
       

      
        
          
          

        

        
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    5.1.11  Recordings
      and Filings.

     

    The
      Borrower shall have: (a) executed and delivered all Financing Documents
      (including, without limitation, UCC-1 and UCC-3 statements) required to be
      filed, registered or recorded in order to create, in favor of the Agent and
      the
      Lenders, a perfected Lien in the Collateral (subject only to the Permitted
      Liens) in form and in sufficient number for filing, registration, and recording
      in each office in each jurisdiction in which such filings, registrations and
      recordations are required, and (b) delivered such evidence as the Agent may
      deem
      satisfactory that all necessary filing fees and all recording and other similar
      fees, and all Taxes and other expenses related to such filings, registrations
      and recordings will be or have been paid in full.

     

    5.1.12  Insurance
      Certificate.

     

    The
      Agent
      shall have received an insurance certificate in accordance with the provisions
      of Section
      6.1.8
      (Insurance) and Section
      6.1.19
      (Insurance With Respect to Equipment).

     

    5.1.13  Bailee
      Acknowledgements.

     

    The
      Agent
      shall have received an agreement acknowledging the Liens of the Agent and the
      Lenders from each bailee, warehouseman, consignee or similar third party that
      has possession of any of the Collateral, which agreements must be reasonably
      acceptable to the Agent and its counsel in their sole and absolute
      discretion.

     

    5.1.14  Field
      Examination.

     

    The
      Agent
      shall have completed a field examination of the Borrower’s business, operations
      and income, the results of which field examination shall be in all respects
      acceptable to the Agent in its sole and absolute discretion and shall include
      reference discussions with key customers and vendors.

     

    5.1.15  Life
      Insurance.

     

    The
      Agent
      shall have received a life insurance policy on the life of Barry B. Goldstein
      in
      an amount not less than One Million Five Hundred Thousand Dollars ($1,500,000)
      issued by an insurance company and in such form and content satisfactory to
      the
      Agent, together with the fully executed duplicate originals of the Assignment
      of
      Life Insurance.

     

    5.1.16  Subordination
      Agreement.

     

    The
      Agent
      shall have received the fully executed Subordination Agreement and the Parent
      Subordination Agreements in form and content acceptable to the Agent. The Agent
      shall have received and approved copies of the fully executed Subordinated
      Debt
      Documents and the Parent Subordinated Debt Documents, all of which must be
      in
      form and content acceptable to the Agent. 

     

    5.1.17  Servicing
      Agreement; Back-Up Servicing Agent.

     

    The
      Agent
      shall have received true and complete copies of the Servicing Agreement
      Documents.

     

    
       

      
        
          
          

        

        
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    5.1.18  Servicing.

     

    The
      Agent
      shall have received true and complete copies of the Servicing Agreement
      Documents and of the Back-Up Servicing Agreement.

     

    Section
      5.2  Conditions
      to all Extensions of Credit.

     

    The
      making of all advances under the Loans is subject to the fulfillment of the
      following conditions precedent in a manner satisfactory in form and substance
      to
      the Agent and its counsel:

     

    5.2.1  Compliance.

     

    The
      Borrower shall have complied and shall then be in compliance with all terms,
      covenants, conditions and provisions of this Agreement and the other Financing
      Documents that are binding upon it.

     

    5.2.2  Borrowing
      Base.

     

    The
      Borrower shall have furnished all Borrowing Base Reports required by
Section
      2.1.5
      (Collateral Reporting), there shall exist no Borrowing Base Deficiency, and
      as
      evidence thereof, the Borrower shall have furnished to the Agent such reports,
      schedules, certificates, records and other papers as may be requested by the
      Agent, and the Borrower shall be in compliance with the provisions of this
      Agreement both immediately before and immediately after the making of the
      Advance requested.

     

    5.2.3  Default.

     

    There
      shall exist no Event of Default or Default hereunder.

     

    5.2.4  Representations
      and Warranties.

     

    The
      representations and warranties of the Borrower contained among the provisions
      of
      this Agreement shall be true and with the same effect as though such
      representations and warranties had been made at the time of the making of,
      and
      of the request for, each advance under the Loans and Revolver Usage, except
      that
      the representations and warranties that relate to financial statements which
      are
      referred to in Section
      4.1.11
      (Financial Condition), shall also be deemed to cover financial statements
      furnished from time to time to the Agent pursuant to Section
      6.1.1
      (Financial Statements).

     

    5.2.5  Adverse
      Change.

     

    No
      adverse change shall have occurred in the condition (financial or otherwise),
      operations or business of the Borrower that would, in the good faith judgment
      of
      the Agent, materially impair the ability of the Borrower to pay or perform
      any
      of the Obligations.

     

    5.2.6  Legal
      Matters.

     

    All
      legal
      documents incident to each advance under the Loans and Revolver Usage shall
      be
      reasonably satisfactory to counsel for the Agent.

     

    
       

      
        
          
          

        

        
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    5.2.7  Consents,
      Licenses, Approvals, Etc.

     

    No
      Premium Finance Licenses or other consent, license or approval required for
      the
      continued operation of the Borrower’s business, shall have been revoked,
      forfeited, terminated, allowed to lapse or otherwise invalidated.

     

    ARTICLE
      VI

    COVENANTS
      OF THE BORROWER

     

    Section
      6.1  Affirmative
      Covenants.

     

    So
      long
      as any of the Obligations (or any the Commitments therefor) shall be outstanding
      hereunder, the Borrower agrees with the Agent and the Lenders as
      follows:

     

    6.1.1  Financial
      Statements.

     

    The
      Borrower shall furnish to the Agent and the Lenders:

     

    (a)  Borrower
      Information.The
      Borrower shall provide the financial reports and information set forth on
      EXHIBIT D attached to and a part of this Agreement and such other reports and
      information as the Agent may require.

     

    (b)  Parent
      Annual Statements and Certificates. The Parent shall furnish to the Agent and
      each of the Lenders as soon as available, but in no event more than ninety
      (90)
      days after the close of each fiscal year of the Parent, (i) a copy of the annual
      financial statement in reasonable detail satisfactory to the Agent relating
      to
      the Parent and its Subsidiaries, prepared in accordance with GAAP and examined
      and certified by independent certified public accountants satisfactory to the
      Agent, which financial statement shall include a consolidated and consolidating
      balance sheet of the Parent and its Subsidiaries as of the end of such fiscal
      year and consolidated and consolidating statements of income, cash flows and
      changes in shareholders equity of the Parent and its Subsidiaries for such
      fiscal year, and (ii) a management letter in the form prepared by the Parent’s
      independent certified public accountants.

     

    (c)  Annual
      Opinion of Accountant. The Parent shall furnish to the Agent and each of the
      Lenders as soon as available, but in no event more than ninety (90) days after
      the close of the Parent’s fiscal years, a letter or opinion of the accountant
      who examined and certified the annual financial statement relating to the Parent
      and its Subsidiaries (i) stating whether anything in such accountant’s
      examination has revealed the occurrence of a Default or an Event of Default
      hereunder, and, if so, stating the facts with respect thereto and (ii)
      acknowledging that the Agent will rely on the statement and that the Parent
      knows of the intended reliance by the Agent.

     

    (d)  Quarterly
      Statements and Certificates. The Parent shall furnish to the Agent and each
      of
      the Lenders as soon as available, but in no event more than forty-five (45)
      days
      after the close of the Parent’s fiscal quarters, consolidated and consolidating
      balance sheets of the Parent and its Subsidiaries as of the close of such
      period, consolidated and consolidating income, cash flows and changes in
      shareholders equity statements for such period, projected cash flow on a month
      to month basis and projected income statements, a certification that no change
      has occurred to the information contained in the Perfection Certificate (except
      as set forth on any schedule attached to the certification), prepared by a
      Responsible Officer in a format acceptable to the Agent, all as prepared and
      certified by a Responsible Officer and accompanied by a certificate of that
      officer stating whether any event has occurred that constitutes a Default or
      an
      Event of Default hereunder, and, if so, stating the facts with respect thereto.
      With the foregoing, the Borrower shall provide a Compliance Certificate, in
      substantially the form attached to this Agreement as EXHIBIT C.

     

    
       

      
        
          
          

        

        
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    (e)  Annual
      Budget and Projections. The Borrower shall furnish to the Agent and each of
      the
      Lenders as soon as available, but in no event later than the 10th day before
      the
      end of each fiscal year a consolidated and consolidating budget and pro forma
      financial statements on a month-to-month basis for the following fiscal year.
      

     

    (f)  Perfection
      Certificates. Promptly after request by the Agent from time to time and no
      later
      than thirty (30) days prior to any material change to information contained
      on
      the Perfection Certificate, the Borrower shall furnish to the Agent an update
      of
      the information contained in the Perfection Certificate.

     

    (g)  Additional
      Reports and Information. The Borrower shall furnish, or cause to be furnished,
      to the Agent promptly, such additional information, reports or statements with
      respect to the Borrower and/or any one or more of the Corporate Guarantors
      as
      the Agent and/or any of the Lenders may from time to time reasonably
      request.

     

    6.1.2  Reports
      to SEC and to Stockholders.

     

    The
      Borrower will furnish to the Agent and the Lenders, promptly upon the filing
      or
      making thereof, at least one (l) copy of all financial statements, reports,
      notices and proxy statements sent by the Borrower to its stockholders, and
      of
      all regular and other reports filed by the Borrower with any securities exchange
      or with the Securities and Exchange Commission.

     

    6.1.3  Recordkeeping,
      Rights of Inspection, Field Examination, Etc.

     

    (a)  The
      Borrower shall, and shall cause each of its Subsidiaries to, maintain (i) a
      standard system of accounting in accordance with GAAP, and (ii) proper books
      of
      record and account in which full, true and correct entries are made of all
      dealings and transactions in relation to its properties, business and
      activities.

     

    (b)  The
      Borrower shall, and shall cause each of its Subsidiaries to, permit authorized
      representatives of the Agent to visit and inspect the properties of the Borrower
      and its Subsidiaries, to review, audit, check and inspect the Collateral at
      any
      time with or without notice, to conduct field examinations, to review, audit,
      check and inspect the Borrower’s other books of record at any time with or
      without notice and to make abstracts and photocopies thereof, and to discuss
      the
      affairs, finances and accounts of the Borrower and/or any Subsidiaries, with
      the
      officers, directors, employees and other representatives of the Borrower and/or
      any Subsidiaries and their respective accountants, all at such times during
      normal business hours and other reasonable times and as often as the Agent
      may
      reasonably request.

     

    (c)  The
      Borrower hereby irrevocably authorizes and directs all accountants and auditors
      employed by the Borrower and/or any Subsidiaries at any time prior to the
      repayment in full of the Obligations to exhibit and deliver to the Agent and
      the
      Lenders copies of any and all of the financial statements, trial balances,
      management letters, or other accounting records of any nature of the Borrower
      and/or any Subsidiaries in the accountant’s or auditor’s possession, and to
      disclose to the Agent and any of the Lenders any information they may have
      concerning the financial status and business operations of the Borrower and
      its
      Subsidiaries. Further, the Borrower hereby authorizes all Governmental
      Authorities to furnish to the Agent and the Lenders copies of reports or
      examinations relating to the Borrower and/or any Subsidiaries, whether made
      by
      the Borrower or otherwise.

     

    
       

      
        
          
          

        

        
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    (d)  Any
      and
      all costs and expenses incurred by, or on behalf of, the Agent in connection
      with the conduct of any of the foregoing, including, without limitation, the
      actual fees and expenses charged for third party examinations and further
      including, without limitation, travel, lodging, meals, and other expenses
      together with an allocated charge of $90 per hour for each examiner that is
      an
      employee of the Agent for inspections of the Collateral and the Borrower’s
      operations and for associated write-up time, shall be part of the Enforcement
      Costs and shall be payable to the Agent upon demand. The Borrower acknowledges
      and agrees that such expenses may include, but shall not be limited to, any
      and
      all out-of-pocket costs and expenses of the Agent’s employees, agents and third
      party examiners in, and when, traveling to the Borrower’s
      facilities.

     

    6.1.4  Corporate
      Existence.

     

    The
      Borrower shall maintain, and cause each of its Subsidiaries to maintain, its
      corporate existence in good standing in the jurisdiction in which it is
      incorporated and in each other jurisdiction where it is required to register
      or
      qualify to do business if the failure to do so in such other jurisdiction might
      have a Material Adverse Effect on the Borrower or such Subsidiary.

     

    6.1.5  Compliance
      with Laws.

     

    The
      Borrower shall comply, and cause each of its Subsidiaries to comply, with all
      applicable Laws and observe the valid requirements of Governmental Authorities,
      the noncompliance with or the nonobservance of which might have a Material
      Adverse Effect on the Borrower or such Subsidiary.

     

    6.1.6  Preservation
      of Properties.

     

    The
      Borrower will, and will cause each of its Subsidiaries to, at all times (a)
      maintain, preserve, protect and keep its properties, whether owned or leased,
      in
      good operating condition, working order and repair (ordinary wear and tear
      excepted), and from time to time will make all proper repairs, maintenance,
      replacements, additions and improvements thereto needed to maintain such
      properties in good operating condition, working order and repair, and (b) do
      or
      cause to be done all things necessary to preserve and to keep in full force
      and
      effect its material franchises, leases of real and personal property, trade
      names, patents, trademarks and permits that are necessary for the orderly
      continuance of its business.

     

    6.1.7  Line
      of Business.

     

    Payments
      Inc. will continue to engage substantially only in the business of providing
      personal and/or commercial automobile property and casualty insurance policies
      premium finance services. The Parent and its other Subsidiaries will continue
      to
      engage substantially only in their current lines of insurance-related
      services.

    
       

      
        
          
          

        

        
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    6.1.8  Insurance.

     

    The
      Borrower will, and will cause each of its Subsidiaries to, at all times
      maintain, with financially sound and reputable insurers having a rating of
      at
      least A-VII or better by Best Rating Guide or other comparable rating chosen
      by
      the Agent, insurance as is required by applicable Laws and such other insurance,
      in such amounts, of such types and against such risks, hazards, liabilities,
      casualties and contingencies as are usually insured against in the same
      geographic areas by business entities engaged in the same or similar business.
      Without limiting the generality of the foregoing, the Borrower will, and will
      cause each of its Subsidiaries to, keep adequately insured all of its property
      against loss or damage resulting from fire or other risks insured against by
      extended coverage and maintain public liability insurance against claims for
      personal injury, death or property damage occurring upon, in or about any
      properties occupied or controlled by it, or arising in any manner out of the
      businesses carried on by it, all in such amounts not less than the Agent shall
      reasonably determine from time to time. The Borrower shall deliver to the Agent
      on the Closing Date (and thereafter on each date there is a material change
      in
      the insurance coverage) a certificate of a Responsible Officer of the Borrower
      containing a detailed list of the insurance then in effect and stating the
      names
      of the insurance companies, the types, the amounts and rates of the insurance,
      dates of the expiration thereof and the properties and risks covered thereby.
      Within thirty (30) days after notice in writing from the Agent, the Borrower
      will obtain such additional insurance as the Agent may reasonably
      request.

     

    6.1.9  Taxes.

     

    Except
      to
      the extent that the validity or amount thereof is being contested in good faith
      and by appropriate proceedings, the Borrower will, and will cause each of its
      Subsidiaries to, pay and discharge all Taxes prior to the date when any interest
      or penalty would accrue for the nonpayment thereof. The Borrower shall furnish
      to the Agent, at such times as the Agent may require, proof satisfactory to
      the
      Agent of the making of payments or deposits required by applicable Laws
      including, without limitation, payments or deposits with respect to amounts
      withheld by the Borrower from wages and salaries of employees and amounts
      contributed by the Borrower on account of federal and other income or wage
      taxes
      and amounts due under the Federal Insurance Contributions Act, as
      amended.

     

    6.1.10  ERISA.

     

    The
      Borrower will, and will cause each of its ERISA Affiliates to, comply with
      the
      funding requirements of ERISA with respect to Plans for its respective
      employees. The Borrower will not permit with respect to any Plan (a) any
      prohibited transaction or transactions under ERISA or the Internal Revenue
      Code,
      that results, or may result, in any material liability of the Borrower and/or
      ERISA Affiliate, or (b) any Reportable Event if, upon termination of the plan
      or
      plans with respect to which one or more such Reportable Events shall have
      occurred, there is or would be any material liability of the Borrower and/or
      ERISA Affiliates to the PBGC. Upon the Lender’s request, the Borrower will
      deliver to the Lender a copy of the most recent actuarial report, financial
      statements and annual report completed with respect to any Plan.

     

    
       

      
        
          
          

        

        
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    6.1.11  Notification
      of Events of Default and Adverse Developments.

     

    The
      Borrower shall promptly notify the Agent upon obtaining knowledge of the
      occurrence of:

     

    (a)  any
      Event
      of Default;

     

    (b)  any
      Default;

     

    (c)  any
      litigation instituted or threatened against the Borrower or its Subsidiaries
      and
      of the entry of any judgment or Lien (other than any Permitted Liens) against
      any of the assets or properties of the Borrower or any of its Subsidiaries
      where
      the claims against the Borrower or any of its Subsidiaries exceed One Hundred
      Thousand Dollars ($100,000) and are not covered by insurance;

     

    (d)  any
      event, development or circumstance whereby the financial statements furnished
      hereunder fail in any material respect to present fairly, in accordance with
      GAAP, the financial condition and operational results of the Borrower or any
      of
      its Subsidiaries;

     

    (e)  any
      judicial, administrative or arbitral proceeding pending against the Borrower
      or
      any of its Subsidiaries and any judicial or administrative proceeding known
      by
      the Borrower to be threatened against the Borrower or any of its Subsidiaries
      that, if adversely decided, could have a Material Adverse Effect;

     

    (f)  the
      receipt by the Borrower or any of its Subsidiaries of any notice, claim or
      demand from any Governmental Authority that alleges that the Borrower or any
      Subsidiary is in violation of any of the terms of, or has failed to comply
      with
      any applicable Laws regulating its operation and business, including, but not
      limited to, the Occupational Safety and Health Act and the Environmental
      Protection Act; and

     

    (g)  any
      other
      development in the business or affairs of the Borrower or any of its
      Subsidiaries that may have a Material Adverse Effect;

     

    (h)  in
      each
      case describing in detail satisfactory to the Agent the nature thereof and
      the
      action the Borrower proposes to take with respect thereto.

     

    6.1.12  Hazardous
      Materials; Contamination.

     

    The
      Borrower agrees to:

     

    (a)  give
      notice to the Agent immediately upon acquiring knowledge of the presence of
      any
      Hazardous Materials or any Hazardous Materials Contamination on any property
      owned, operated or controlled by the Borrower or for which the Borrower is,
      or
      is claimed to be, responsible (provided that such notice shall not be required
      for Hazardous Materials placed or stored on such property in accordance with
      applicable Laws in the ordinary course (including, without limitation, quantity)
      of the Borrower’s line of business expressly described in this Agreement), with
      a full description thereof;

     

    
       

      
        
          
          

        

        
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    (b)  promptly
      comply with any Laws requiring the removal, treatment or disposal of Hazardous
      Materials or Hazardous Materials Contamination and provide the Agent with
      satisfactory evidence of such compliance;

     

    (c)  provide
      the Agent, within thirty (30) days after a demand by the Agent, with a bond,
      letter of credit or similar financial assurance evidencing to the Agent’s
      satisfaction that the necessary funds are available to pay the cost of removing,
      treating, and disposing of such Hazardous Materials or Hazardous Materials
      Contamination and discharging any Lien that may be established as a result
      thereof on any property owned, operated or controlled by the Borrower or for
      which the Borrower is, or is claimed to be, responsible; and

     

    (d)  as
      part
      of the Obligations, defend, indemnify and hold harmless the Agent, each of
      the
      Lenders and each of their respective agents, employees, trustees, successors
      and
      assigns from any and all claims that may now or in the future (whether before
      or
      after the termination of this Agreement) be asserted as a result of the presence
      of any Hazardous Materials or any Hazardous Materials Contamination on any
      property owned, operated or controlled by the Borrower for which the Borrower
      is, or is claimed to be, responsible. 

     

    The
      Borrower acknowledges and agrees that this indemnification shall survive the
      termination of this Agreement and the Commitments and the payment and
      performance of all of the other Obligations.

     

    6.1.13  Disclosure
      of Significant Transactions.

     

    The
      Borrower shall deliver to the Agent a written notice describing in detail each
      transaction by it involving the purchase, sale, lease, or other acquisition
      or
      loss or casualty to or disposition of an interest in Fixed or Capital Assets
      that exceeds Two Hundred Fifty Thousand Dollars ($250,000.00), said notices
      to
      be delivered to the Agent within thirty (30) days of the occurrence of each
      such
      transaction.

     

    6.1.14  Key
      Man Life Insurance.

     

    The
      Borrower shall at all times maintain life insurance with a responsible insurer
      on the life of Barry B. Goldstein in an amount not less than One Million Five
      Hundred Thousand Dollars ($1,500,000) and will assign the proceeds of such
      life
      insurance to the Agent pursuant to the Assignment of Life
      Insurance.

     

    6.1.15  Financial
      Covenants.

     

    (a)  Certain
      Definitions. As used in this Agreement, the Term:

     

    
       

      
        
          
          

        

        
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    “Capitalization”
means
      as to the Borrower at any date of determination thereof the sum of the
      Borrower’s Tangible Net Worth plus Borrower’s Subordinated Indebtedness.

     

    “Capitalization
      Ratio”
means
      the ratio of (a) total liabilities of the Borrower (including book overdraft
      as
      a liability, not as an offset to cash) minus Borrower’s Subordinated
      Indebtedness to (b) the Borrower’s Capitalization. 

     

    “EBITDA”
means
      as to the Borrower for any period of determination thereof, the sum of (a)
      the
      net profit (or loss) determined in accordance with GAAP consistently applied,
      plus (b) interest expense and income tax provisions for such period, plus (c)
      depreciation and amortization of assets for such period. 

     

    “Fixed
      Charge Coverage Ratio” means for any period of determination thereof, the ratio
      of (a) EBITDA, to (b) the sum of (i) the aggregate amount of interest expense,
      plus (ii) scheduled principal payments on Funded Debt, plus (iii) cash taxes
      paid, plus (iv) non-financed Capital Expenditures (Capital Expenditures financed
      with the Revolving Loan being deemed to be non-financed), plus (E) any dividends
      paid to stockholders, plus (v) without duplication, any other distributions
      that
      reduce the Borrower’s Net Worth.

     

    “Funded
      Debt”
means
      the aggregate of the consolidated outstanding principal balance under the
      Revolving Loan plus the Borrower’s Subordinated Indebtedness plus all other
      Indebtedness for Borrowed Money (other than that described on clauses (f) and
      (g) of that term) plus the amount of book overdrafts upon the Borrower’s deposit
      accounts plus unfunded liabilities (that is, “Due
      to
      carriers” accounts payable as shown on the Borrower’s balance sheet and
      determined on a consistent basis).

     

    “Net
      Worth”
means
      the shareholders’ equity of the Borrower, defined in accordance with GAAP.

     

    “Tangible
      Net Worth”
means
      as to the Borrower at any date of determination thereof, the aggregate at such
      time of the Borrower’s Net Worth minus the total of (a) all assets that would be
      classified as intangible assets under GAAP consistently applied, (b) applicable
      reserves, allowances and other similar properly deductible items to the extent
      such reserves, allowances and other similar properly deductible items have
      not
      been previously deducted by the Agent in the calculation of shareholders’
equity, (c) any revaluation or other write-up in book value of assets subsequent
      to the date of the most recent financial statements delivered to the Agent,
      and
      (d) the amount of all loans and advances to, or investments in, any Person
      (other than pursuant to Premium Finance Agreements), other than cash equivalents
      and deposit accounts maintained with any financial institution.

     

    (b)  Capitalization
      Ratio. The Borrower shall maintain, tested as of the last day of each month,
      for
      the twelve (12) month period ending on the test date, a Capitalization Ratio,
      of
      not greater than 7.0 to 1.0. 

     

    (c)  Finance
      Receivables to Funded Debt Ratio. Payments Inc. shall maintain, tested as of
      the
      last day of each of month, a
      ratio
      of total Receivables due and owing under Premium Finance Agreements net of
      all
      reserves as required in accordance with GAAP, consistently applied, to Funded
      Debt of not less than 1.0 to 1.0.

     

    
       

      
        
          
          

        

        
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    (d)  Fixed
      Charge Coverage Ratio. The
      Borrower shall maintain, tested as of the last day of each of the Borrower’s
      fiscal quarters for the twelve (12) month period ending on the test date, a
      Fixed Charge Coverage Ratio of not less than 1.05 to 1.0.

     

    6.1.16  Collection
      of Receivables.

     

    Until
      such time that the Agent shall notify the Borrower of the revocation of such
      privilege, the Borrower and each of the Subsidiaries shall at its own expense
      have the privilege for the account of, and in trust for, the Agent and the
      Lenders of collecting its Receivables and receiving in respect thereto all
      Items
      of Payment and shall otherwise completely service all of the Receivables
      including (a) the billing, posting and maintaining of complete records
      applicable thereto, (b) the taking of such action with respect to the
      Receivables as the Agent may request or in the absence of such request, as
      the
      Borrower and each of the Subsidiaries may deem advisable; and (c) the granting,
      in the ordinary course of business, to any Account Debtor, any rebate, refund
      or
      adjustment to which the Account Debtor may be lawfully entitled, and may accept,
      in connection therewith, the return of goods, the sale or lease of which shall
      have given rise to a Receivable and may take such other actions relating to
      the
      settling of any Account Debtor’s claim as may be commercially reasonable. The
      Agent may, at its option, at any time or from time to time after and during
      the
      continuance of a Default hereunder, revoke the collection privilege given in
      this Agreement to the Borrower and each of the Subsidiaries and by either giving
      notice of its assignment of, and Lien on the Collateral to the Account Debtors
      or giving notice of such revocation to the Borrower. The Agent shall not have
      any duty to, and the Borrower hereby releases the Agent and the Lenders from
      all
      claims of loss or damage caused by the delay or failure to collect or enforce
      any of the Receivables or to preserve any rights against any other party with
      an
      interest in the Collateral. The Agent shall be entitled at any time and from
      time to time to confirm and verify Receivables.

     

    6.1.17  Assignments
      of Receivables.

     

    The
      Borrower will promptly, upon request, execute and deliver to the Agent written
      assignments, in form and content acceptable to the Agent, of specific
      Receivables or groups of Receivables; provided, however, the Lien and/or
      security interest granted to the Agent, for the ratable benefit of the Lenders
      and for the benefit of the Agent with respect to the Agent’s Obligations, under
      this Agreement shall not be limited in any way to or by the inclusion or
      exclusion of Receivables within such assignments. Receivables so assigned shall
      secure payment of the Obligations and are not sold to the Agent and/or the
      Lenders whether or not any assignment thereof, that is separate from this
      Agreement, is in form absolute. The Borrower agrees that neither any assignment
      to the Lender nor any other provision contained in this Agreement or any of
      the
      other Financing Documents shall impose on the Agent or the Lenders any
      obligation or liability of the Borrower with respect to that which is assigned
      and the Borrower hereby agrees to indemnify the Agent and the Lenders and hold
      the Agent and the Lenders harmless from any and all claims, actions, suits,
      losses, damages, costs, expenses, fees, obligations and liabilities that may
      be
      incurred by or imposed upon the Agent and/or any of the Lenders by virtue of
      the
      assignment of and Lien on the Borrower’s rights, title and interest in, to, and
      under the Collateral.

     

    
       

      
        
          
          

        

        
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    6.1.18  Notice
      of Commercial Tort Claims.

     

    The
      Borrower shall promptly notify the Agent in writing in the event the Borrower
      shall have, receive or otherwise obtain a commercial tort claim, as plaintiff
      or
      otherwise in its favor against any third party and, upon the request of the
      Agent, shall promptly amend the Perfection Certificate and, without implying
      any
      limitation on the provisions of Section
      6.1.22
      (Further
      Assurances; Defense of Title), confirm that the Agent is authorized to file
      additional, and to amend, financing statements and do such other acts or things
      deemed necessary or desirable by the Agent to grant the Agent a first priority,
      perfected security interest in any such commercial tort claim, including,
      without limitation executing an assignment of such commercial tort
      claim.

     

    6.1.19  Insurance
      With Respect to Equipment.

     

    The
      Borrower will (a) maintain and cause each of its Subsidiaries to maintain hazard
      insurance with fire and extended coverage and naming the Agent as an additional
      insured with loss payable to the Agent as its respective interest may appear
      on
      the Equipment in an amount at least equal to the lesser amount of the
      outstanding principal amount of the Obligations or the fair market value of
      the
      Equipment (but in any event sufficient to avoid any co-insurance obligations)
      and with a specific endorsement to each such insurance policy pursuant to which
      the insurer agrees to give the Agent at least thirty (30) days written notice
      before any alteration or cancellation of such insurance policy and that no
      act
      or default of the Borrower shall affect the right of the Agent to recover under
      such policy in the event of loss or damage; (b) file and cause each of its
      Subsidiaries to file with the Agent, upon its request, a detailed list of the
      insurance then in effect and stating the names of the insurance companies,
      the
      amounts and rates of the insurance, dates of the expiration thereof and the
      properties and risks covered thereby; and (c) within thirty (30) days after
      notice in writing from the Agent, obtain and cause each of its Subsidiaries
      to
      maintain such additional insurance as the Agent may reasonably
      request.

     

    6.1.20  Maintenance
      of the Collateral. 

     

    The
      Borrower will maintain the Collateral in good working order, saving and
      excepting ordinary wear and tear, and will not permit anything to be done to
      the
      Collateral that may materially impair the value thereof. The Agent, or an agent
      designed by the Agent, shall be permitted to enter the premises of the Borrower
      and the Subsidiaries and examine, audit and inspect the Collateral at any
      reasonable time and from time to time without notice. The Agent and the Lenders
      shall not have any duty to, and the Borrower hereby releases the Agent and
      the
      Lenders from all claims of loss or damage caused by the delay or failure to
      collect or enforce any of the Receivables or to preserve any rights against
      any
      other party with an interest in the Collateral.

     

    6.1.21  Equipment.

     

    The
      Borrower shall (a) maintain all Equipment as personalty, (b) not affix any
      Equipment to any real estate in such manner as to become a fixture or part
      of
      such real estate, and (c) shall hold no Equipment on a sale on approval basis.
      The Borrower hereby declares its intent that, notwithstanding the means of
      attachment, no goods of the Borrower hereafter attached to any realty shall
      be
      deemed a fixture, which declaration shall be irrevocable, without the Agent’s
      consent, until all of the Obligations have been paid in full and all of the
      Commitments have been terminated or have expired.

    
       

      
        
          
          

        

        
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    6.1.22  Further
      Assurances; Defense of Title.

     

    At
      its
      expense, the Borrower will defend the title to the Collateral (and any part
      thereof), and will immediately execute, acknowledge and deliver any financing
      statement, renewal, affidavit, deed, assignment, continuation statement,
      security agreement, certificate or other document that the Agent may require
      in
      order to perfect, preserve, maintain, continue, protect and/or extend the Lien
      or security interest granted to the Agent, for the ratable benefit of the
      Lenders and for the benefit of the Agent with respect to the Agent’s
      Obligations, under this Agreement, under any of the other Financing Documents
      and the first priority of that Lien, subject only to the Permitted Liens. The
      Borrower will from time to time do whatever the Agent may require by way of
      obtaining, executing, delivering, and/or filing financing statements, landlords’
or mortgagees’ waivers, notices of assignment and other notices and amendments
      and renewals thereof and the Borrower will take any and all steps and observe
      such formalities as the Agent may require, in order to create and maintain
      a
      valid Lien upon, pledge of, or paramount security interest in, the Collateral,
      subject to the Permitted Liens. Without implying any limitation on the
      foregoing, with respect to the Collateral that may be perfected by control,
      the
      Borrower shall take such steps as the Lender may require in order that Agent
      may
      have such control. The Borrower shall pay to the Agent on demand all taxes,
      costs and expenses incurred by the Agent in connection with the preparation,
      execution, recording and filing of any such document or instrument. To the
      extent that the proceeds of any of the Receivables of the Borrower are expected
      to become subject to the control of, or in the possession of, a party other
      than
      the Borrower or the Agent, the Borrower shall cause all such parties to execute
      and deliver on the Closing Date security documents, financing statements or
      other documents as requested by the Agent and as may be necessary to evidence
      and/or perfect the security interest of the Agent, for the ratable benefit
      of
      the Lenders and for the benefit of the Agent with respect to the Agent’s
      Obligations, in those proceeds. The Borrower agrees that a copy of a fully
      executed security agreement and/or financing statement shall be sufficient
      to
      satisfy for all purposes the requirements of a financing statement as set forth
      in Article 9 of the applicable Uniform Commercial Code. The Borrower hereby
      irrevocably appoints the Agent as the Borrower’s attorney-in-fact, with power of
      substitution, in the name of the Agent or in the name of the Borrower or
      otherwise, for the use and benefit of the Agent for itself and the Lenders,
      but
      at the cost and expense of the Borrower and without notice to the Borrower,
      to
      execute and deliver any and all of the instruments and other documents and
      take
      any action which the Lender may require pursuant the foregoing provisions of
      this Section
      6.1.22.
      Further, to the extent permitted by applicable Laws, the Agent is hereby
      authorized to file, without the Borrower’s signature, one or more financing
      statements or other notices disclosing the liens and other security interests
      of
      the Agent and the Lenders. All financing statements and notices may describe
      the
      collateral of the Agent and the Lenders as all assets and/or all personal
      property of the Borrower. The Borrower hereby ratifies and confirms the Agent’s
      authority to file and the validity of any and all such financing statements
      and
      notices filed prior to the date of this Agreement.

     

    6.1.23  Business
      Information.

     

    The
      Borrower will notify the Agent not less than thirty (30) days prior to (a)
      any
      change in its name or in the name under which the Borrower conducts its
      business, (b) any change to the Borrower’s state of organization, identity or
      organizational structure, (c) any change of the location of the chief executive
      office of the Borrower, and (d) the opening of any new place of business or
      the
      closing of any existing place of business, and any change in the location of
      the
      places where the Collateral, or any part thereof, or the books and records,
      or
      any part thereof, are kept.

     

    
       

      
        
          
          

        

        
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    6.1.24  Subsequent
      Opinion of Counsel as to Recording Requirements.

     

    In
      the
      event that the Borrower or any Subsidiary shall transfer its principal place
      of
      business or the office where it keeps its records pertaining to the Collateral,
      upon the Agent’s request the Borrower will provide to the Agent a subsequent
      opinion of counsel as to the filing, recording and other requirements with
      which
      the Borrower and its Subsidiaries have complied to maintain the Lien and
      security interest in favor of the Agent, for the ratable benefit of the Lenders
      and for the benefit of the Agent with respect to the Agent’s Obligations, in the
      Collateral.

     

    6.1.25  Use
      of
      Premises and Equipment.

     

    The
      Borrower agrees that until the Obligations are fully paid and all of the
      Commitments have been terminated or have expired, the Agent (a) after and during
      the continuance of a Default or an Event of Default, may use any of the
      Borrower’s owned or leased lifts, hoists, trucks and other facilities or
      equipment for handling or removing the Collateral; and (b) shall have, and
      is
      hereby granted, a right of ingress and egress to the places where the Collateral
      is located, and may proceed over and through any of the Borrower’s owned or
      leased property.

     

    6.1.26  Protection
      of Collateral.

     

    The
      Borrower agrees that the Agent may at any time following an Event of Default
      take such steps as the Agent deems reasonably necessary to protect the interest
      of the Agent and the Lenders in, and to preserve the Collateral, including,
      without limitation, the hiring of such security guards, the placing of other
      security protection measures, and otherwise restricting access to owned or
      leased locations where Collateral is located, all as the Agent deems appropriate
      from time to time, may employ and maintain at any of the Borrower’s premises a
      custodian who shall have full authority to do all acts necessary to protect
      the
      interests of the Agent and the Lenders in the Collateral and may lease warehouse
      facilities to which the Agent may move all or any part of the Collateral to
      the
      extent commercially reasonable. The Borrower agrees to cooperate fully with
      the
      Agent’s efforts to preserve the Collateral and will take such actions to
      preserve the Collateral as the Agent may reasonably direct. All of the Agent’s
      expenses of preserving the Collateral, including any reasonable expenses
      relating to the compensation and bonding of a custodian, shall be part of the
      Enforcement Costs.

     

    6.1.27  Appraisals.

     

    Whenever
      a Default or an Event of Default exists, and at such other times as the Agent
      may request, but not more frequently than once a year, the Borrower shall,
      at
      its expense, provide the Agent with appraisals or updates thereof of any or
      all
      of the Collateral from an appraiser and in form in all respects satisfactory
      to
      the Agent.

     

    
       

      
        
          
          

        

        
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    6.1.28  Servicing
      Agreements.

     

    The
      Borrower agrees that the Servicing Agreement Documents and the Back-Up Servicing
      Agreement shall remain in full force and effect at all times. The agreements,
      terms and conditions of this Agreement with respect to the Servicer and the
      Servicing Agreement shall apply to the servicer under the Back-Up Servicing
      Agreement and to the Back-Up Servicing Agreement at such times as the servicer
      is providing, or is obligated to provide, services under the Back-Up Servicing
      Agreement. Under the terms of the Servicing Agreement Documents, the Servicer
      shall at all times: (a) be authorized and obligated, upon notification from
      the
      Agent of an Event of Default, to perform its servicing duties solely for the
      benefit of the Agent; (b) receive all Items of Payment and other Collateral
      as
      the Agent’s bailee for the purpose of perfecting the Agent’s and the Lenders’
security interests therein, (c) deposit all proceeds of Items of Payment and
      other Collateral into the Collateral Account; (d) be obligated to provide to
      the
      Agent not less than three hundred sixty-five (365) days notice of the Servicer’s
      intent to cancel the Servicing Agreement; and (e) along with the Borrower,
      covenant and agree that the Servicer shall not be authorized to modify or amend
      the Servicing Agreement Documents without the Agent’s express written
      consent.

     

    6.1.29  Borrower’s
      Procedures.

     

    Payments
      Inc.’s forms and procedures shall at all times reflect the following to the
      continuing satisfaction of the Agent:

     

    (a)  Premium
      Finance Agreements, payment coupon books, and such other materials, shall
      reflect the Agent as secured creditor to Payments Inc. and shall direct that
      payments be made to the Servicer. References in the Premium Finance Agreements
      to the “Loan and Security Agreement with” the Agent mean this Agreement,
as
      amended, restated, modified, substituted, extended and renewed from time to
      time.

     

    (b)  Scheduled
      monthly payments and all other Items of Payments shall be (i) received by the
      Servicer for processing (or forwarded to the Servicer by Payments Inc.) for
      the
      benefit of the Agent and the Lenders, and as bailee for the purpose of
      perfecting Agent’s and the Lenders’ security interest therein, (ii) deposited by
      the Servicer into the Collateral Account; (iii) if made payable to Payments
      Inc.
      shall be endorsed by the Servicer pursuant to authority granted by Payments
      Inc.
      to the Servicer in the Servicing Agreement for deposit to, and deposited
      exclusively to the Collateral Account;

     

    (c)  Payments
      Inc.’s “Notices of Financed Premium,” “Notices of Cancellation” and other
      notices or claims with respect to returned premiums or Receivables (the
      foregoing collectively, “Premium Claim Notices”) (i) shall specify the Agent’s
      interest, as secured creditor to Payments Inc., in returned premiums on policies
      financed by Payments Inc. and (ii) shall direct that all remittances shall
      be
      made payable to “M&T Bank, Secured Creditor”, as secured creditor to
      Payments Inc. at the Servicer’s address, unless Payments Inc. and the Agent
      shall have agreed otherwise in each instance. All Items of Payment with respect
      to those remittances shall deposited into the Collateral Account in compliance
      with Section
      2.1.10
      (Collateral Account).

     

    
       

      
        
          
          

        

        
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    (d)  To
      the
      extent that Payments Inc. receives any scheduled payments on Premium Finance
      Agreements or payments of returned premiums on cancelled Premium Finance
      Agreement or pursuant to Premium Claim Notices, via ACH transfers or other
      standing transfer orders, Payments Inc. shall modify its notices and other
      communication materials to instruct payors that such payments are to be directed
      to the Collateral Account.

     

    (e)  Payments
      Inc. shall irrevocably and continuously provide the Agent “read only” access, or
      such other access to be determined, to Payments Inc.’s accounting and financial
      records including, without limitation, those with respect to the
      Receivables.

     

    (f)  No
      later
      than fifteen (15) days after the end of each month, Payments Inc. to provide
      the
      Agent with premium disbursement file monthly in electronic format acceptable
      to
      the Agent.

     

    (g)  Payments
      Inc. shall at all times use the Agent’s “Full Account Reconciliation” program
      (or, at the Agent’s direction, other program or programs offered by the Agent)
      for Payments Inc.’s deposit and contract disbursement accounts. The proceeds of
      the Receivables shall be subject to the provisions of Section
      2.1.10
      (Collateral Account).

     

    Section
      6.2  Negative
      Covenants.

     

    So
      long
      as any of the Obligations or the Commitments therefor shall be outstanding
      hereunder, the Borrower agrees with the Agent and the Lenders that without
      the
      prior written consent of the Agent:

     

    6.2.1  Capital
      Structure, Merger, Acquisition or Sale of Assets.

     

    Payment
      Inc. will not alter or amend its capital structure, authorize any additional
      class of equity, issue any stock or equity of any class. The Borrower will
      not
      enter into any merger or consolidation or amalgamation, windup or dissolve
      itself (or suffer any liquidation or dissolution) or acquire all or
      substantially all the assets of any Person (except pursuant to an Approved
      Acquisition), or sell, lease or otherwise dispose of any of its assets. Any
      consent of the Agent to the disposition of any assets may be conditioned on
      a
      specified use of the proceeds of disposition.

     

    6.2.2  Subsidiaries.

     

    The
      Borrower will not create or acquire any Subsidiaries other than the Subsidiaries
      identified on the Perfection Certificate without the prior written consent
      of
      the Agent, which
      consent shall not be unreasonably withheld or delayed.

     

    6.2.3  Purchase
      or Redemption of Securities, Dividend Restrictions.

     

    Payments
      will not purchase, redeem or otherwise acquire any shares of its capital stock
      or warrants now or hereafter outstanding, declare or pay any dividends thereon
      (other than stock dividends), provided, however, that neither proceeds of the
      Loans nor the Collateral may be used for such purpose without the prior written
      consent of the Agent. The Borrower will not apply any of its property or assets
      to the purchase, redemption or other retirement of, set apart any sum for the
      payment of any dividends on, or for the purchase, redemption, or other
      retirement of, make any distribution by reduction of capital or otherwise in
      respect of, any shares of any class of capital stock of the Borrower, or any
      warrants, permit any Subsidiary to purchase or acquire any shares of any class
      of capital stock of, or warrants issued by, of the Borrower, make any
      distribution to stockholders or set aside any funds for any such purpose, and
      not prepay, purchase or redeem any Indebtedness for Borrowed Money other than
      the Obligations, except for Permitted Distributions and except for dividends
      or
      other distributions or advances made to the Parent when there exists no Default
      or Event of Default in order to enable
      the
      Parent to pay at a time payments due and payable (other than those payments
      which may not be made due to applicable provisions of subordination) under
      the
      Parent Subordinated Debt
      and the
      corresponding portion of the Subordinated Debt to the extent the payments are
      expressly permitted by this Agreement, the Subordination Agreement and the
      Parent Subordination
      Agreement..

     

    
       

      
        
          
          

        

        
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    6.2.4  Indebtedness.

     

    The
      Borrower will not, and will not permit any Subsidiary to, create, incur, assume
      or suffer to exist any Indebtedness for Borrowed Money, or permit any Subsidiary
      so to do, except:

     

    (a)  the
      Obligations;

     

    (b)  current
      accounts payable arising in the ordinary course;

     

    (c)  indebtedness
      secured by Permitted Liens;

     

    (d)  Subordinated
      Indebtedness; and

     

    (e)  indebtedness
      of the Borrower existing on the date hereof and reflected on the financial
      statements furnished pursuant to Section
      4.1.11
      (Financial Condition).

     

    6.2.5  Investments,
      Loans and Other Transactions.

     

    Except
      as
      otherwise provided in this Agreement, the Borrower will not, and will not permit
      any of its Subsidiaries to, (a) except pursuant to an Approved Acquisition,
      make, assume, acquire or continue to hold any investment in any real property
      (unless used in connection with its business and treated as a Fixed or Capital
      Asset of the Borrower or the Subsidiary) or any Person, whether by stock
      purchase, capital contribution, acquisition of indebtedness of such Person
      or
      otherwise (including, without limitation, investments in any joint venture
      or
      partnership), (b) guaranty or otherwise become contingently liable for the
      indebtedness, liabilities or other obligations of any Person, or (c) make any
      loans or advances, or otherwise extend credit to any Person,
      except:

     

    (i)  any
      advance to an officer or employee of the Borrower or of any Subsidiary for
      travel or other business expenses in the ordinary course of business, provided
      that the aggregate amount of all such advances by all of the Borrower and its
      Subsidiaries (taken as a whole) outstanding at any time shall not exceed Two
      Thousand Five Hundred Dollars ($2,500);

     

    
       

      
        
          
          

        

        
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    (ii)  the
      endorsement of negotiable instruments for deposit or collection or similar
      transactions in the ordinary course of business;

     

    (iii)  any
      investment in Cash Equivalents, that are pledged to the Agent, for the ratable
      benefit of the Lenders and for the benefit of the Agent with respect to the
      Agent’s Obligations, as collateral and security for the Obligations;
      and

     

    (iv)  trade
      credit extended to customers in the ordinary course of business.

     

    6.2.6  Operating
      Lease Obligations.

     

    The
      Borrower will not incur or permit to exist any Lease Obligations (including,
      without limitation, Lease Obligations with respect to real property) incurred
      after the date of this Agreement except Capital Leases expressly permitted
      by
      this Agreement or permit any Subsidiary so to do, if the aggregate amount of
      all
      such Lease Obligations of the Borrower and the Subsidiaries (taken as a whole)
      would at any time exceed Two Hundred Thousand Dollars ($200,000) during any
      fiscal year of the Borrower.

     

    6.2.7  Stock
      of Subsidiaries.

     

    The
      Borrower, without the prior written consent of the Agent, which
      consent shall not be unreasonably withheld or delayed,
      will
      not sell or otherwise dispose of any shares of capital stock of any Subsidiary
      (except in connection with a merger or consolidation of a Wholly Owned
      Subsidiary into the Borrower or another Wholly Owned Subsidiary of the Borrower
      or with the dissolution of any Subsidiary) or permit any Subsidiary to issue
      any
      additional shares of its capital stock except pro rata
      to its
      stockholders.

     

    6.2.8  Subordinated
      Indebtedness.

     

    The
      Borrower will not, and will not permit any Subsidiary to make:

     

    (a)  except
      from the Permitted Distributions, any payment of principal of, or interest
      on,
      any of the Subordinated Indebtedness, including, without limitation, the
      Subordinated Debt, if a Default or Event of Default then exists hereunder or
      would result from such payment;

     

    (b)  any
      payment of the principal or interest due on the Subordinated Indebtedness as
      a
      result of acceleration thereunder or a mandatory prepayment
      thereunder;

     

    (c)  any
      amendment or modification of or supplement to the documents evidencing or
      securing the Subordinated Indebtedness; and

     

    (d)  payment
      of principal or interest on the Subordinated Indebtedness other than when due
      (without giving effect to any acceleration of maturity or mandatory
      prepayment).

     

    
       

      
        
          
          

        

        
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    6.2.9  Liens.

     

    The
      Borrower agrees that it (a) will not create, incur, assume or suffer to exist
      any Lien upon any of its properties or assets, whether now owned or hereafter
      acquired, or permit any Subsidiary so to do, except for Liens securing the
      Obligations and Permitted Liens, (b) will not agree to, assume or suffer to
      exist any provision in any instrument or other document for confession of
      judgment, cognovit or other similar right or remedy, (c) will not allow or
      suffer to exist any Permitted Liens to be superior to Liens securing the
      Obligations except as expressly set forth in Schedule
      4.1.22,
      (d)
      will not enter into any contracts for the consignment of goods, will not execute
      or suffer the filing of any financing statements or the posting of any signs
      giving notice of consignments, and will not, as a material part of its business,
      engage in the sale of goods belonging to others, and (e) will not allow or
      suffer to exist the failure of any Lien described in the Security Documents
      to
      attach to, and/or remain at all times perfected on, any of the property
      described in the Security Documents.

     

    6.2.10  Transactions
      with Affiliates.

     

    Except
      (a) as permitted in Section
      6.2.3
      (Purchase or Redemption of Securities; Dividend Restrictions) or Section
      6.2.16
      (Compensation), (b) for the reimbursement of reasonable payroll expenses
      incurred by DCAP Management Corp. on behalf of the Borrower as further set
      forth
      in that certain letter agreement dated July 10, 2003 between the Borrower and
      Parent, a true copy of which the Borrower and Parent have provided to the Agent
      prior to the execution and delivery of this Agreement, (c) transactions between
      the Borrower and the Corporate Guarantors (other than the Parent) that are
      in
      the ordinary course of business relating or incidental to the financing of
      automobile insurance premiums and that are upon fair and reasonable terms which
      are no less favorable than would be obtained in a comparable arms-length
      transaction with a Person who is not an Affiliate and which are profitable
      for
      the Borrower, and (d) the payment of sublease payments in the ordinary course
      from Borrower to the Parent pursuant to that certain sublease agreement dated
      October 1, 2002, the Borrower and its Subsidiaries will not enter into or
      participate in any transaction with any Affiliate or, except in the ordinary
      course of business, with the officers, directors, employees and other
      representatives of the Borrower and/or any Subsidiary.

     

    6.2.11  Other
      Businesses.

     

    Payments
      Inc. and its Subsidiaries will not, without the prior written consent of the
      Agent, engage directly or indirectly in any business other than the business
      of
      financing premiums for personal and/or commercial automobile property and
      casualty insurance policies in the States of New York and New Jersey and the
      Commonwealth of Pennsylvania, and such other States as the Agent may approve
      in
      the exercise of its sole and absolute discretion from time to time. The Parent
      and its other Subsidiaries will continue to engage substantially only in their
      current lines of insurance-related services.

     

    6.2.12  ERISA
      Compliance.

     

    None
      of
      the Borrower nor any ERISA Affiliate shall: (a) engage in or permit any
“prohibited transaction” (as defined in ERISA); (b) cause any “accumulated
      funding deficiency” as defined in ERISA and/or the Internal Revenue Code; (c)
      terminate any pension plan in a manner that could result in the imposition
      of a
      lien on the property of the Borrower pursuant to ERISA; (d) terminate or consent
      to the termination of any Multi-employer Plan; or (e) incur a complete or
      partial withdrawal with respect to any Multi-employer Plan.

     

    
       

      
        
          
          

        

        
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    6.2.13  Prohibition
      on Hazardous Materials.

     

    The
      Borrower shall not place, manufacture or store or permit to be placed,
      manufactured or stored any Hazardous Materials on any property owned, operated
      or controlled by the Borrower or for which the Borrower is responsible other
      than Hazardous Materials placed or stored on such property in accordance with
      applicable Laws in the ordinary course of the Borrower’s business expressly
      described in this Agreement.

     

    6.2.14  Amendments.

     

    Payments
      Inc. will not amend, terminate or allow to lapse or agree to amend, terminate
      or
      allow to lapse the Premium Finance Licenses or any other franchise, license,
      consent, approval or agreement necessary for Payments Inc. to operate its
      business in the normal course, or
      consent to or waive any material provisions thereof. The Parent and its other
      Subsidiaries
      will not
      amend, terminate or allow to lapse or agree to amend, terminate or allow to
      lapse any franchise, license, consent, approval or agreement necessary the
      Parent or the applicable Subsidiary to operate its business in the normal
      course, or
      consent to or waive any material provisions thereof.

     

    6.2.15  Method
      of Accounting; Fiscal Year.

     

    The
      Borrower agrees that:

     

    (a)  it
      shall
      not change the method of accounting employed in the preparation of any financial
      statements furnished to the Agent under the provisions of Section
      6.1.1
      (Financial Statements), unless required to conform to GAAP and on the condition
      that the Borrower’s accountants shall furnish such information as the Agent may
      request to reconcile the changes with the Borrower’s prior financial
      statements

     

    (b)  it
      will
      not change its fiscal year from a year ending on December 31.

     

    6.2.16  Compensation.

     

    Neither
      the Borrower nor any of its Subsidiaries will pay any bonuses, fees,
      compensation, commissions, salaries, drawing accounts, or other payments (cash
      and non-cash), whether direct or indirect, to any stockholders of the Borrower
      or its Subsidiaries, or any Affiliate of the Borrower or its Subsidiaries,
      other
      than reasonable compensation for actual services rendered by stockholders in
      their capacity as officers or employees of the Borrower and other compensation
      pursuant to (i) that certain Employment Agreement dated May 28, 2003 between
      AIA-DCAP Corp. and Barry Lefkowitz and (ii) that certain Employment Agreement
      dated May 10, 2001 between the Parent and Barry Goldstein, true and correct
      copies of which have been provided to the Agent prior to the execution of this
      Agreement. The Employment Agreements will not be modified or amended without
      the
      prior written consent of the Agent.

     

    
       

      
        
          
          

        

        
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    6.2.17  Transfer
      of Collateral.

     

    The
      Borrower and the Subsidiaries will not transfer, or permit the transfer, to
      another location of any of the Collateral or the books and records related
      to
      any of the Collateral.

     

    6.2.18  Sale
      and Leaseback.

     

    The
      Borrower and the Subsidiaries will not directly or indirectly enter into any
      arrangement to sell or transfer all or any substantial part of its fixed assets
      and thereupon or within one (1) year thereafter rent or lease the assets so
      sold
      or transferred.

     

    6.2.19  Disposition
      of Collateral.

     

    Neither
      the Borrower nor the Subsidiaries will sell, discount, allow credits or
      allowances, transfer, assign, extend the time for payment on, convey, lease,
      assign, transfer or otherwise dispose of the Collateral, except, prior to an
      Event of Default, dispositions expressly permitted elsewhere in this Agreement,
      the sale of unnecessary or obsolete Equipment, but only if the proceeds of
      the
      sale of such Equipment are (a) used to purchase similar Equipment to replace
      the
      unnecessary or obsolete Equipment or (b) immediately turned over to the Agent
      for application to the Obligations in accordance with the provisions of this
      Agreement.

     

    ARTICLE
      VII

    DEFAULT
      AND RIGHTS AND REMEDIES

     

    Section
      7.1  Events
      of Default.

     

    The
      occurrence of any one or more of the following events shall constitute an “Event
      of Default” under the provisions of this Agreement:

     

    7.1.1  Failure
      to Pay.

     

    The
      failure of the Borrower to pay any of the Obligations as and when due and
      payable in accordance with the provisions of this Agreement, the Notes and/or
      any of the other Financing Documents.

     

    7.1.2  Breach
      of Representations and
      Warranties.

     

    Any
      representation or warranty made in this Agreement or in any report, statement,
      schedule, certificate, opinion (including any opinion of counsel for the
      Borrower), financial statement or other document furnished in connection with
      this Agreement, any of the other Financing Documents, or the Obligations, shall
      prove to have been false or misleading when made (or, if applicable, when
      reaffirmed) in any material respect.

     

    7.1.3  Failure
      to Comply with Covenants.

     

    The
      failure of the Borrower to perform, observe or comply with any covenant,
      condition or agreement contained in this Agreement.

     

    
      
        
          
          

        

        
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    7.1.4  Default
      Under Other Financing Documents or Obligations.

     

    A
      default
      shall occur under any of the other Financing Documents or under any other
      Obligations, and such default is not cured within any applicable grace period
      provided therein.

     

    7.1.5  Receiver;
      Bankruptcy.

     

    The
      Borrower or any Subsidiary shall (a) apply for or consent to the appointment
      of
      a receiver, trustee or liquidator of itself or any of its property, (b) admit
      in
      writing its inability to pay its debts as they mature, (c) make a general
      assignment for the benefit of creditors, (d) be adjudicated a bankrupt or
      insolvent, (e) file a voluntary petition in bankruptcy or a petition or an
      answer seeking or consenting to reorganization or an arrangement with creditors
      or to take advantage of any bankruptcy, reorganization, insolvency, readjustment
      of debt, dissolution or liquidation law or statute, or an answer admitting
      the
      material allegations of a petition filed against it in any proceeding under
      any
      such law, or take corporate action for the purposes of effecting any of the
      foregoing, or (f) by any act indicate its consent to, approval of or
      acquiescence in any such proceeding or the appointment of any receiver of or
      trustee for any of its property, or suffer any such receivership, trusteeship
      or
      proceeding to continue undischarged for a period of sixty (60) days, or (g)
      by
      any act indicate its consent to, approval of or acquiescence in any order,
      judgment or decree by any court of competent jurisdiction or any Governmental
      Authority enjoining or otherwise prohibiting the operation of a material portion
      of the Borrower’s or any Subsidiary’s business or the use or disposition of a
      material portion of the Borrower’s or any Subsidiary’s assets.

     

    7.1.6  Involuntary
      Bankruptcy, etc.

     

    (a)
      An
      order for relief shall be entered in any involuntary case brought against the
      Borrower or any Subsidiary under the Bankruptcy Code, or (b) any such case
      shall
      be commenced against the Borrower or any Subsidiary and shall not be dismissed
      within sixty (60) days after the filing of the petition, or (c) an order,
      judgment or decree under any other Law is entered by any court of competent
      jurisdiction or by any other Governmental Authority on the application of a
      Governmental Authority or of a Person other than the Borrower or any Subsidiary
      (i) adjudicating the Borrower or any Subsidiary bankrupt or insolvent, or (ii)
      appointing a receiver, trustee or liquidator of the Borrower or of any
      Subsidiary, or of a material portion of the Borrower’s or any Subsidiary’s
      assets, or (iii) enjoining, prohibiting or otherwise limiting the operation
      of a
      material portion of the Borrower’s or any Subsidiary’s business or the use or
      disposition of a material portion of the Borrower’s or any Subsidiary’s assets,
      and such order, judgment or decree continues unstayed and in effect for a period
      of thirty (30) days from the date entered.

     

    7.1.7  Judgment.

     

    Unless
      adequately insured in the opinion of the Agent, the entry of a final judgment
      or
      final judgments for the payment of money involving more than $50,000 in the
      aggregate against the Borrower and/or any one or more of the Corporate
      Guarantors, and the failure by the Borrower and the Corporate Guarantors to
      discharge the same, or cause it to be discharged, within thirty (30) days from
      the date of the order, decree or process under which or pursuant to which such
      judgment was entered, or to secure a stay of execution pending appeal of such
      judgment.

     

    
      
        
          
          

        

        
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    7.1.8  Execution;
      Attachment.

     

    Any
      execution or attachment shall be levied against the Collateral, or any part
      thereof, and such execution or attachment shall not be set aside, discharged
      or
      stayed within thirty (30) days after the same shall have been
      levied.

     

    7.1.9  Default
      Under Other Borrowings.

     

    Default
      shall be made with respect to any Indebtedness for Borrowed Money (other than
      the Loan) with an aggregate outstanding principal balance of more than $100,000
      if the default is a failure to pay at maturity or if the effect of such default
      is to accelerate the maturity of such Indebtedness for Borrowed Money or to
      permit the holder or obligee thereof or other party thereto to cause any such
      Indebtedness for Borrowed Money to become due prior to its stated
      maturity.

     

    7.1.10  Challenge
      to Agreements.

     

    The
      Borrower or any of the Guarantors shall challenge the validity and binding
      effect of any provision of any of the Financing Documents or shall state its
      intention to make such a challenge of any of the Financing Documents or any
      of
      the Financing Documents shall for any reason (except to the extent permitted
      by
      its express terms) cease to be effective or to create a valid and perfected
      first priority Lien (except for Permitted Liens) on, or security interest in,
      any of the Collateral purported to be covered thereby.

     

    7.1.11  Material
      Adverse Effect Change.

     

    The
      Agent, in its sole discretion, determines in good faith that an event has
      occurred with respect to the Borrower that may have Material Adverse
      Effect.

     

    7.1.12  Change
      of Control.

     

    Any
      Person, other than the Parent, shall own any equity interest in Payments Inc.,
      or any Person (other than Barry B. Goldstein) or group (as such term is used
      in
      Sections 13 and 14 of the Securities Exchange Act of 1934, as amended (the
      “Exchange Act”), and the rules and regulations thereunder) shall have become the
      direct or indirect beneficial owner (as defined in Rules 13d-3 and 13d-5
      promulgated under the Exchange Act) of, or shall have the right to vote or
      otherwise control, 30% or more of any class of voting securities of the
      Parent.

     

    7.1.13  Liquidation,
      Termination, Dissolution, Change in Management, etc.

     

    The
      Borrower shall liquidate, dissolve or terminate its existence or shall suspend
      or terminate a substantial portion of its business operations or Barry B.
      Goldstein shall no longer hold the office and perform the duties of chief
      executive and chief operating officer of the Borrower any change occurs in
      the
      management or control of the Borrower without the prior written consent of
      the
      Agent.

    
       

      
        
          
          

        

        
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    7.1.14  Subordinated
      Debt (Parent).

     

    On
      or
      before December 31, 2006, the maturity date of the subordinated debt in Parent
      shall be not have been extended to at least December 31, 2008. 

     

    Section
      7.2  Remedies.

     

    Upon
      the
      occurrence of any Event of Default, the Agent may, in the exercise of its sole
      and absolute discretion from time to time, and shall, at the direction of the
      Required Lenders, at any time thereafter exercise any one or more of the
      following rights, powers or remedies.

     

    7.2.1  Acceleration.

     

    The
      Agent
      may declare any or all of the Obligations to be immediately due and payable,
      notwithstanding anything contained in this Agreement or in any of the other
      Financing Documents to the contrary, without presentment, demand, protest,
      notice of protest or of dishonor, or other notice of any kind, all of which
      the
      Borrower hereby waives.

     

    7.2.2  Further
      Advances.

     

    The
      Agent
      may from time to time without notice to the Borrower suspend, terminate or
      limit
      any further Advances, loans or other extensions of credit under the Commitment,
      under this Agreement and/or under any of the other Financing Documents. Further,
      upon the occurrence of an Event of Default or Default specified in Section
      7.1.5
      (Receiver; Bankruptcy) or Section
      7.1.6
      (Involuntary Bankruptcy, etc.), the Commitments and any agreement in any of
      the
      Financing Documents to provide additional credit shall immediately and
      automatically terminate and the unpaid principal amount of the Notes (with
      accrued interest thereon) and all other Obligations then outstanding, shall
      immediately become due and payable without further action of any kind and
      without presentment, demand, protest or notice of any kind, all of which are
      hereby expressly waived by the Borrower.

     

    7.2.3  Uniform
      Commercial Code.

     

    The
      Agent
      shall have all of the rights and remedies of a secured party under the
      applicable Uniform Commercial Code and other applicable Laws. Upon demand by
      the
      Agent, the Borrower shall assemble the Collateral and make it available to
      the
      Agent, at a place designated by the Agent. The Agent or its agents may without
      notice from time to time enter upon the Borrower’s premises to take possession
      of the Collateral, to remove it, to render it unusable, to process it or
      otherwise prepare it for sale, or to sell or otherwise dispose of
      it.

     

    Any
      written notice of the sale, disposition or other intended action by the Agent
      with respect to the Collateral that is sent by regular mail, postage prepaid,
      to
      the Borrower at the address set forth in Section
      9.1
      (Notices), or such other address of the Borrower that may from time to time
      be
      shown on the Agent’s records, at least ten (10) days prior to such sale,
      disposition or other action, shall constitute commercially reasonable notice
      to
      the Borrower. The Agent may alternatively or additionally give such notice
      in
      any other commercially reasonable manner. Nothing in this Agreement shall
      require the Agent to give any notice not required by applicable
      Laws.

    
       

      
        
          
          

        

        
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    If
      any
      consent, approval, or authorization of any state, municipal or other
      Governmental Authority or of any other Person or of any Person having any
      interest therein, should be necessary to effectuate any sale or other
      disposition of the Collateral, the Borrower agrees to execute all such
      applications and other instruments, and to take all other action, as may be
      required in connection with securing any such consent, approval or
      authorization.

     

    The
      Borrower recognizes that the Agent may be unable to effect a public sale of
      all
      or a part of the Collateral consisting of investment property by reason of
      certain prohibitions contained in the Securities Act of 1933, as amended, and
      other applicable Federal and state Laws. The Agent may, therefore, in its
      discretion, take such steps as it may deem appropriate to comply with such
      Laws
      and may, for example, at any sale of the Collateral consisting of securities
      restrict the prospective bidders or purchasers as to their number, nature of
      business and investment intention, including, without limitation, a requirement
      that the Persons making such purchases represent and agree to the satisfaction
      of the Agent that they are purchasing such securities for their account, for
      investment, and not with a view to the distribution or resale of any thereof.
      The Borrower covenants and agrees to do or cause to be done promptly all such
      acts and things as the Agent may request from time to time and as may be
      necessary to offer and/or sell the securities or any part thereof in a manner
      that is valid and binding and in conformance with all applicable Laws. Upon
      any
      such sale or disposition, the Agent shall have the right to deliver, assign
      and
      transfer to the purchaser thereof the Collateral consisting of securities so
      sold.

     

    7.2.4  Specific
      Rights With Regard to Collateral.

     

    In
      addition to all other rights and remedies provided hereunder or as shall exist
      at law or in equity from time to time, the Agent may (but shall be under no
      obligation to), without notice to the Borrower, and the Borrower hereby
      irrevocably appoints the Agent as its attorney-in-fact, with power of
      substitution, in the name of the Agent and/or any or all of the Lenders and/or
      in the name of the Borrower or otherwise, for the use and benefit of the Agent
      and the Lenders, but at the cost and expense of the Borrower and without notice
      to the Borrower:

     

    (a)  request
      any Account Debtor obligated on any of the Receivables to make payments thereon
      directly to the Agent, with the Agent taking control of the cash and non-cash
      proceeds thereof;

     

    (b)  compromise,
      extend or renew any of the Collateral or deal with the same as it may deem
      advisable;

     

    (c)  make
      exchanges, substitutions or surrenders of all or any part of the
      Collateral;

     

    (d)  copy,
      transcribe, or remove from any place of business of the Borrower or any
      Subsidiary all books, records, ledger sheets, correspondence, invoices and
      documents, relating to or evidencing any of the Collateral or without cost
      or
      expense to the Agent or the Lenders, make such use of the Borrower’s or any
      Subsidiary’s place(s) of business as may be reasonably necessary to administer,
      control and collect the Collateral;

     

    
       

      
        
          
          

        

        
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    (e)  repair,
      alter or supply goods if necessary to fulfill in whole or in part the purchase
      order of any Account Debtor;

     

    (f)  demand,
      collect, receipt for and give renewals, extensions, discharges and releases
      of
      any of the Collateral;

     

    (g)  institute
      and prosecute legal and equitable proceedings to enforce collection of, or
      realize upon, any of the Collateral;

     

    (h)  settle,
      renew, extend, compromise, compound, exchange or adjust claims in respect of
      any
      of the Collateral or any legal proceedings brought in respect
      thereof;

     

    (i)  endorse
      or sign the name of the Borrower upon any Items of Payment, certificates of
      title, instruments, investment property, stock powers, documents, documents
      of
      title, financing statements, assignments, notices or other writing relating
      to
      or part of the Collateral and on any proof of claim in bankruptcy against an
      Account Debtor;

     

    (j)  notify
      the Post Office authorities to change the address for the delivery of mail
      to
      the Borrower to such address or Post Office Box as the Agent may designate
      and
      receive and open all mail addressed to the Borrower ; and

     

    (k)  take
      any
      other action necessary or beneficial to realize upon or dispose of the
      Collateral or to carry out the terms of this Agreement.

     

    7.2.5  Application
      of Proceeds.

     

    Any
      proceeds of sale or other disposition of the Collateral will be applied by
      the
      Agent to the payment first of any and all Agent’s Obligations, then to any and
      all Enforcement Costs, and any balance of such proceeds will be remitted to
      the
      Lenders in like currency and funds received ratably in accordance with their
      respective Pro Rata Shares of such balance. Each Lender shall apply any such
      proceeds received from the Agent to its Obligations in such order and manner
      as
      such Lender shall determine. If the sale or other disposition of the Collateral
      fails to fully satisfy the Obligations, the Borrower shall remain liable to
      the
      Agent and the Lenders for any deficiency.

     

    7.2.6  Performance
      by Agent.

     

    If
      the
      Borrower shall fail to pay the Obligations or otherwise fail to perform, observe
      or comply with any of the conditions, covenants, terms, stipulations or
      agreements contained in this Agreement or any of the other Financing Documents,
      the Agent without notice to or demand upon the Borrower and without waiving
      or
      releasing any of the Obligations or any Default or Event of Default, may (but
      shall be under no obligation to) at any time thereafter make such payment or
      perform such act for the account and at the expense of the Borrower, and may
      enter upon the premises of the Borrower for that purpose and take all such
      action thereon as the Agent may consider necessary or appropriate for such
      purpose and the Borrower hereby irrevocably appoints the Agent as its
      attorney-in-fact to do so, with power of substitution, in the name of the Agent,
      in the name of any or all of the Lenders, or in the name of the Borrower or
      otherwise, for the use and benefit of the Agent, but at the cost and expense
      of
      the Borrower and without notice to the Borrower. All sums so paid or advanced
      by
      the Agent together with interest thereon from the date of payment, advance
      or
      incurring until paid in full at the Post-Default Rate and all costs and
      expenses, shall be deemed part of the Enforcement Costs, shall be paid by the
      Borrower to the Agent on demand, and shall constitute and become a part of
      the
      Agent’s Obligations.

    
       

      
        
          
          

        

        
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    7.2.7  Other
      Remedies.

     

    The
      Agent
      may from time to time proceed to protect or enforce the rights of the Agent
      and/or any of the Lenders by an action or actions at law or in equity or by
      any
      other appropriate proceeding, whether for the specific performance of any of
      the
      covenants contained in this Agreement or in any of the other Financing
      Documents, or for an injunction against the violation of any of the terms of
      this Agreement or any of the other Financing Documents, or in aid of the
      exercise or execution of any right, remedy or power granted in this Agreement,
      the Financing Documents, and/or applicable Laws. The Agent and each of the
      Lenders is authorized to offset and apply to all or any part of the Obligations
      all moneys, credits and other property of any nature whatsoever of the Borrower
      now or at any time hereafter in the possession of, in transit to or from, under
      the control or custody of, or on deposit with, the Agent, any of the Lenders
      or
      any Affiliate of the Agent or any of the Lenders.

     

    ARTICLE
      VIII

    THE
      AGENT

     

    Section
      8.1  Appointment
      and Authorization.

     

    Each
      Lender hereby designates and appoints M&T as its Agent under this Agreement
      and the other Financing Documents and each Lender hereby irrevocably authorizes
      the Agent to take such action on its behalf under the provisions of this
      Agreement and each other Financing Document and to exercise such powers and
      perform such duties as are expressly delegated to it by the terms of this
      Agreement or any other Financing Document, together with such powers as are
      reasonably incidental thereto. The Agent agrees to act as such on the express
      conditions contained in this ARTICLE
      VIII.
      The
      provisions of this ARTICLE
      VIII
      are
      solely for the benefit of the Agent and the Lenders and the Borrower shall
      have
      no rights as a third party beneficiary of any of the provisions contained
      herein. 

     

    Section
      8.2  Nature
      of Duties

     

    8.2.1  In
      General.

     

    Notwithstanding
      any provision to the contrary contained elsewhere in this Agreement or in any
      other Financing Document, the Agent shall not have any duties or
      responsibilities, except those expressly set forth herein, nor shall the Agent
      have or be deemed to have any fiduciary relationship with any Lender, and no
      implied covenants, functions, responsibilities, duties, obligations or
      liabilities shall be read into this Agreement or any other Financing Document
      or
      otherwise exist against the Agent. Without limiting the generality of the
      foregoing sentence, the use of the term “agent” in this Agreement with reference
      to the Agent is not intended to connote any fiduciary or other implied (or
      express) obligations arising under agency doctrine of any applicable law.
      Instead, such term is used merely as a matter of market custom, and is intended
      to create or reflect only an administrative relationship between independent
      contracting parties. Except as expressly otherwise provided in this Agreement,
      the Agent shall have and may use its sole discretion with respect to exercising
      or refraining from exercising any discretionary rights or taking
      or
      refraining from taking any actions which the Agent is expressly entitled to
      take
      or assert under this Agreement and the other Financing Documents, including
      (a)
      the determination of the applicability of ineligibility criteria with respect
      to
      the calculation of the Borrowing Base, (b) the making of Agent Advances, and
      (c)
      the exercise of remedies pursuant to this Agreement and the other Financing
      Documents, and any action so taken or not taken shall be deemed consented to
      by
      the Lenders.

     

    
       

      
        
          
          

        

        
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    8.2.2  Delegation
      of Duties.

     

    The
      Agent
      may execute any of its duties under this Agreement or any other Financing
      Document by or through agents, employees or attorneys-in-fact and shall be
      entitled to advice of counsel concerning all matters pertaining to such duties.
      The Agent shall not be responsible for the negligence or misconduct of any
      agent
      or attorney-in-fact that it selects as long as such selection was made without
      gross negligence or willful misconduct as determined by a final non-appealable
      order by a court of competent jurisdiction,.

     

    8.2.3  Express
      Authorization

     

    The
      Agent
      is hereby expressly and irrevocably authorized by each of the Lenders, as agent
      on behalf of itself and the other Lenders:

     

    (a)  to
      receive on behalf of each of the Lenders any payment or collection on account
      of
      the Obligations and to distribute to each Lender its Pro Rata Share of all
      such
      payments and collections so received as provided in this Agreement;

     

    (b)  to
      receive all documents and items to be furnished to the Lenders under the
      Financing Documents (nothing contained herein shall relieve the Borrower of
      any
      obligation to deliver any item directly to the Lenders to the extent expressly
      required by the provisions of this Agreement);

     

    (c)  to
      act or
      refrain from acting in this Agreement and in the other Financing Documents
      with
      respect to those matters so designated for the Agent;

     

    (d)  to
      act as
      nominee for and on behalf of the Lenders in and under this Agreement and the
      other Financing Documents;

     

    (e)  to
      arrange for the means whereby the funds of the Lenders are to be made available
      to the Borrower;

     

    (f)  to
      distribute promptly to the Lenders, if required by the terms of this Agreement,
      all written information, requests, notices, Loan Notices, payments, Prepayments,
      documents and other items received from the Borrower or other
      Person;

     

    
       

      
        
          
          

        

        
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    (g)  to
      amend,
      modify, or waive any provisions of this Agreement or the other Financing
      Documents on behalf of the Lenders subject to the requirement that certain
      of
      the Lenders’ consent be obtained in certain instances as provided in
9.2.2
      (Consent
      of All Lenders Required);

     

    (h)  to
      deliver to the Borrower and other Persons, all requests, demands, approvals,
      notices, and consents received from any of the Lenders;

     

    (i)  to
      exercise on behalf of each Lender all rights and remedies of the Lenders upon
      the occurrence of any Event of Default and/or Default specified in this
      Agreement and/or in any of the other Financing Documents or applicable
      Laws;

     

    (j)  to
      execute any of the Security Documents and any other documents on behalf of
      the
      Lenders as the secured party for the benefit of the Agent and the Lenders;
      and

     

    (k)  to
      take
      such other actions as may be requested by the Required Lenders.

     

    Section
      8.3  Liability
      of Agent.

     

    None
      of
      the Agent-Related Persons shall (a) be liable for any action taken or omitted
      to
      be taken by any of them under or in connection with this Agreement or any other
      Financing Document or the transactions contemplated hereby (except for its
      own
      gross negligence or willful misconduct as determined by a final non-appealable
      order by a court of competent jurisdiction,), (b) be liable for any
      apportionment or distribution of payments made by it in good faith and if any
      such apportionment or distribution is subsequently determined to have been
      made
      in error the sole recourse of any Lender to whom payment was due but not made,
      shall be to recover from the other Lenders any payment in excess of the amount
      to which they are determined to be entitled (and such other Lenders hereby
      agree
      to return to such Lender any such erroneous payments received by them), or
      (c)
      be responsible in any manner to any of the Lenders for any recital, statement,
      representation or warranty made by the Borrower or any Subsidiary or Affiliate
      of the Borrower, or any officer thereof, contained in this Agreement or in
      any
      other Financing Document, or in any certificate, report, statement or other
      document referred to or provided for in, or received by the Agent under or
      in
      connection with, this Agreement or any other Financing Document, or the
      validity, effectiveness, genuineness, enforceability or sufficiency of this
      Agreement or any other Financing Document, or for any failure of the Borrower
      or
      any other party to any Financing Document to perform its obligations hereunder
      or thereunder. No Agent-Related Person shall be under any obligation to any
      Lender to ascertain or to inquire as to the observance or performance of any
      of
      the agreements contained in, or conditions of, this Agreement or any other
      Financing Document, or to inspect the properties, books or records of the
      Borrower or any of the Borrower’s Subsidiaries or Affiliates.

     

    Section
      8.4  Reliance
      by Agent.

     

    The
      Agent
      shall be entitled to rely, and shall be fully protected in relying, upon any
      writing, resolution, notice, consent, certificate, affidavit, letter, telegram,
      facsimile, telex or telephone message, statement or other document or
      conversation believed by it to be genuine and correct and to have been signed,
      sent or made by the proper Person or Persons, and upon advice and statements
      of
      legal counsel (including counsel to the Borrower), independent accountants
      and
      other experts selected by the Agent. The Agent may deem and treat the original
      Lenders as the owners of the respective Notes for all purposes until receipt
      by
      the Agent of a written notice of assignment, negotiation or transfer of any
      interest therein by the Lenders in accordance with the terms of this Agreement.
      The Agent shall be fully justified in failing or refusing to take any action
      under this Agreement or any other Financing Document unless it shall first
      receive such advice or concurrence of the Required Lenders as it deems
      appropriate and, if it so requests, it shall first be indemnified to its
      satisfaction by the Lenders against any and all liability and expense which
      may
      be incurred by it by reason of taking or continuing to take any such action.
      The
      Agent shall in all cases be fully protected in acting, or in refraining from
      acting, under this Agreement or any other Financing Document in accordance
      with
      a request or consent of the Required Lenders (or all Lenders if so required
      by
Section
      9.2.2
      (Consent
      of All Lenders Required)) and such request and any action taken or failure
      to
      act pursuant thereto shall be binding upon all of the Lenders.

    
       

      
        
          
          

        

        
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    Section
      8.5  Notice
      of Default.

     

    The
      Agent
      shall not be deemed to have knowledge or notice of the occurrence of any Default
      or Event of Default, unless the Agent shall have received written notice from
      a
      Lender or the Borrower referring to this Agreement, describing such Default
      or
      Event of Default and stating that such notice is a “notice of default.” The
      Agent will notify the Lenders of its receipt of any such notice. The Agent
      shall
      take such action with respect to such Default or Event of Default as may be
      requested by the Required Lenders in accordance with Section
      9.2.2
      (Consent
      of All Lenders Required); provided,
      however,
      that
      unless and until the Agent has received any such request, the Agent may (but
      shall not be obligated to) take such action, or refrain from taking such action,
      with respect to such Default or Event of Default as it shall deem
      advisable.

     

    Section
      8.6  Credit
      Decision.

     

    Each
      Lender acknowledges that none of the Agent-Related Persons has made any
      representation or warranty to it, and that no act by the Agent hereinafter
      taken, including any review of the affairs of the Borrower and its Affiliates,
      shall be deemed to constitute any representation or warranty by any
      Agent-Related Person to any Lender. Each Lender represents to the Agent that
      it
      has, independently and without reliance upon any Agent-Related Person and based
      on such documents and information as it has deemed appropriate, made its own
      appraisal of and investigation into the business, prospects, operations,
      property, financial and other condition and creditworthiness of the Borrower
      and
      its Affiliates, and all applicable bank regulatory laws relating to the
      transactions contemplated hereby, and made its own decision to enter into this
      Agreement and to extend credit to the Borrower. Each Lender also represents
      that
      it will, independently and without reliance upon any Agent-Related Person and
      based on such documents and information as it shall deem appropriate at the
      time, continue to make its own credit analysis, appraisals and decisions in
      taking or not taking action under this Agreement and the other Financing
      Documents, and to make such investigations as it deems necessary to inform
      itself as to the business, prospects, operations, property, financial and other
      condition and creditworthiness of the Borrower. Except for notices, reports
      and
      other documents expressly herein required to be furnished to the Lenders by
      the
      Agent, the Agent shall not have any duty or responsibility to provide any Lender
      with (and, to the extent provided, Agent-Related Persons shall have no liability
      for the accuracy or completeness of) any credit or other information, including,
      without limitation, field examinations performed by Agent-Related Persons,
      concerning the business, prospects, operations, property, financial and other
      condition or creditworthiness of the Borrower which may come into the possession
      of any of the Agent-Related Persons.
      For
      purposes of determining compliance with the conditions specified in ARTICLE
      V
      (CONDITIONS PRECEDENT), each Lender that has signed this Agreement shall be
      deemed to have consented to, approved or accepted or to be satisfied with,
      each
      document or other matter required thereunder to be consented to or approved
      by
      or acceptable or satisfactory to a Lender unless Agent shall have received
      notice from such Lender prior to the proposed Closing Date specifying its
      objection thereto.

     

    
       

      
        
          
          

        

        
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    Section
      8.7  Indemnification.

     

    Whether
      or not the transactions contemplated hereby are consummated, the Lenders shall
      indemnify upon demand the Agent-Related Persons (to the extent not reimbursed
      by
      or on behalf of the Borrower and without limiting the obligation of the Borrower
      to do so), in accordance with their Pro Rata Shares, from and against any and
      all Indemnified Liabilities as such term is defined in Section
      9.19
      (Indemnification); provided,
      however,
      that no
      Lender shall be liable for the payment to the Agent-Related Persons of any
      portion of such Indemnified Liabilities resulting solely from such Person’s
      gross negligence or willful misconduct as determined by a final non-appealable
      order by a court of competent jurisdiction,. Without limitation of the
      foregoing, each Lender shall reimburse the Agent upon demand for its Pro Rata
      Share of any costs or out-of-pocket expenses (including Enforcement Costs)
      incurred by the Agent in connection with the preparation, execution, delivery,
      administration, modification, amendment or enforcement (whether through
      negotiations, legal proceedings or otherwise) of, or legal advice in respect
      of
      rights or responsibilities
      under, this Agreement, any other Financing Document, or any document
      contemplated by or referred to herein, to the extent that the Agent is not
      reimbursed for such expenses by or on behalf of the Borrower. The undertaking
      in
      this Section shall survive the payment of all Obligations hereunder and the
      resignation or replacement of the Agent.

     

    Section
      8.8  Agent
      in Individual Capacity.

     

    The
      M&T and its Affiliates may make loans to, issue letters of credit for the
      account of, accept deposits from, acquire equity interests in and generally
      engage in any kind of banking, trust, financial advisory, underwriting or other
      business with the Borrower and its
      Subsidiaries and Affiliates as though the M&T were not the Agent hereunder
      and without notice to or consent of the Lenders. The M&T or its Affiliates
      may receive information regarding the Borrower, its Affiliates and Account
      Debtors (including information that may be subject to confidentiality
      obligations in favor of the Borrower or such Subsidiary) and acknowledge that
      the Agent and the M&T shall be under no obligation to provide such
      information to them. With respect to its Loans, the M&T shall have the same
      rights and powers under this Agreement as any other Lender and may exercise
      the
      same as though it were not the Agent, and the terms “Lender” and “Lenders”
include the M&T in its individual capacity.

     

    Section
      8.9  Successor
      Agent.

     

    The
      Agent
      may resign as Agent upon at least 30 days’ prior notice to the Lenders and the
      Borrower, such resignation to be effective upon the acceptance of a successor
      agent to its appointment as Agent. In the event the M&T sells all of its
      Commitment and Revolving Loans as part of a sale, transfer or other disposition
      by the M&T of substantially all of its loan portfolio, the M&T shall
      resign as Agent and such purchaser or transferee shall become the successor
      Agent hereunder. Subject to the foregoing, if the Agent resigns under this
      Agreement, the Required Lenders shall appoint from among the Lenders a successor
      agent for the Lenders. If no successor agent is appointed prior to the effective
      date of the resignation of the Agent, the Agent may appoint, after consulting
      with the Lenders and the Borrower, a successor agent from among the Lenders.
      Upon the acceptance of its appointment as successor agent hereunder, such
      successor agent shall succeed to all the rights, powers and duties of the
      retiring Agent and the term “Agent” shall mean such successor agent and the
      retiring Agent’s appointment, powers and duties as Agent shall be terminated.
      After any retiring Agent’s resignation hereunder as Agent, the provisions of
      this ARTICLE
      8
      shall
      continue to inure to its benefit as to any actions taken or omitted to be taken
      by it while it was Agent under this Agreement.

    
       

      
        
          
          

        

        
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    Section
      8.10  Status
      of Lenders.

     

    Each
      Lender represents and warrants to the Agent that the Lender is a “United States
      person” within the meaning of Section 7701(a)(30) of the Internal Revenue Code
      and such Lender claims exemption from, or a reduction of, U.S. withholding
      tax
      under Sections 1441 or 1442 of the Internal Revenue Code, or has complied with
      the provisions of Section
      8.11
      (Withholding Tax). 

     

    Section
      8.11  Withholding
      Tax.

     

    If
      any
      Lender is a “foreign corporation, partnership or trust” within the meaning of
      the Code and such Lender claims exemption from, or a reduction of, U.S.
      withholding tax under Sections 1441 or 1442 of the Code, such Lender agrees
      with
      and in favor of the Agent, to deliver to the Agent:

     

    (a)  if
      such
      Lender claims an exemption from, or a reduction of, withholding tax under a
      United States of America tax treaty, properly completed IRS Forms W-8BEN and
      W-8ECI before the payment of any interest in the first calendar year and before
      the payment of any interest in each third succeeding calendar year during which
      interest may be paid under this Agreement;

     

    (b)  if
      such
      Lender claims that interest paid under this Agreement is exempt from United
      States of America withholding tax because it is effectively connected with a
      United States of America trade or business of such Lender, two properly
      completed and executed copies of IRS Form W-8ECI before the payment of any
      interest is due in the first taxable year of such Lender and in each succeeding
      taxable year of such Lender during which interest may be paid under this
      Agreement, and IRS Form W-9; and

     

    (c)  such
      other form or forms as may be required under the Code or other laws of the
      United States of America as a condition to exemption from, or reduction of,
      United States of America withholding tax.

     

    
       

      
        
          
          

        

        
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    Such
      Lender agrees to promptly notify the Agent of any change in circumstances which
      would modify or render invalid any claimed exemption or reduction.

     

    If
      any
      Lender claims exemption from, or reduction of, withholding tax under a United
      States of America tax treaty by providing IRS Form FW-8BEN and such Lender
      sells, assigns, grants a participation in, or otherwise transfers all or part
      of
      the Obligations owing to such Lender, such Lender agrees to notify the Agent
      of
      the percentage amount in which it is no longer the beneficial owner of
      Obligations of the Borrower to such Lender. To the extent of such percentage
      amount, the Agent will treat such Lender’s IRS Form W-8BEN as no longer
      valid.

     

    If
      any
      Lender claiming exemption from United States of America withholding tax by
      filing IRS Form W-8ECI with the Agent sells, assigns, grants a participation
      in,
      or otherwise transfers all or part of the Obligations owing to such Lender,
      such
      Lender agrees to undertake sole responsibility for complying with the
      withholding tax requirements imposed by Sections 1441 and 1442 of the
      Code.

     

    If
      any
      Lender is entitled to a reduction in the applicable withholding tax, the Agent
      may withhold from any interest payment to such Lender an amount equivalent
      to
      the applicable withholding tax after taking into account such reduction. If
      the
      forms or other documentation required by subsection
      (a)
      of this
      Section are not delivered to the Agent, then the Agent may withhold from any
      interest payment to such Lender not providing such forms or other documentation
      an amount equivalent to the applicable withholding tax.

     

    If
      the
      IRS or any other Governmental Authority of the United States of America or
      other
      jurisdiction asserts a claim that the Agent did not properly withhold tax from
      amounts paid to or for the account of any Lender (because the appropriate form
      was not delivered, was not properly executed, or because such Lender failed
      to
      notify the Agent of a change in circumstances which rendered the exemption
      from,
      or reduction of, withholding tax ineffective, or for any other reason) such
      Lender shall indemnify the Agent fully for all amounts paid, directly or
      indirectly, by the Agent as tax or otherwise, including penalties and interest,
      and including any taxes imposed by any jurisdiction on the amounts payable
      to
      the Agent under this Section, together with all costs and expenses (including,
      without limitation, reasonable attorneys fees and other Enforcement Costs).
      The
      obligation of the Lenders under this subsection shall survive the payment of
      all
      Obligations and the resignation or replacement of the Agent.

     

    Section
      8.12  Collateral
      Matters.

     

    8.12.1  Release
      of Collateral.

     

    The
      Lenders hereby irrevocably authorize the Agent, at its option and in its sole
      discretion, to release any Agent’s Liens upon any Collateral (i) upon the
      termination of the Commitments and payment and satisfaction in full by Borrower
      of all Loans and reimbursement obligations in respect of letters of credit
      and
      any other Obligations, and the termination of all outstanding letters of credit
      (whether or not any of such obligations are due) and all other Obligations;
      (ii) constituting property being sold or disposed of if the Borrower
      certifies to the Agent that the sale or disposition is made in compliance with
      Section
      6.2.1
      (Capital
      Structure, Merger, Acquisition or Sale of Assets) (and the Agent may rely
      conclusively on any such certificate, without further inquiry);
      (iii) constituting property in which the Borrower owned no interest at the
      time the Lien was granted or at any time thereafter or property which was the
      subject of a Permitted Lien in which the other secured party holds a Lien with
      priority over the Agent’s Liens; or (iv) constituting property leased to the
      Borrower under a lease which has expired or been terminated in a transaction
      permitted under this Agreement. Except as provided above, the Agent will not
      release any of the Agent’s Liens without the prior written authorization of the
      Lenders; provided
      that the
      Agent may, in its discretion, release the Agent’s Liens on Collateral valued in
      the aggregate not in excess of $500,000 during each Fiscal Year without the
      prior written authorization of the Lenders and the Agent may release the Agent’s
      Liens on Collateral valued in the aggregate not in excess of $1,000,000 during
      each Fiscal Year with the prior written authorization of Required Lenders.
      Upon
      request by the Agent or the Borrower at any time, the Lenders will confirm
      in
      writing the Agent’s authority to release any Agent’s Liens upon particular types
      or items of Collateral pursuant to this Section
      8.12.

     

    
       

      
        
          
          

        

        
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    Upon
      receipt by the Agent of any necessary authorization required pursuant to this
      Section
      8.12
      (a) from
      the Lenders of the Agent’s authority to release Agent’s Liens upon particular
      types or items of Collateral, and upon at least five (5) Business Days prior
      written request by the Borrower, the Agent shall (and is hereby irrevocably
      authorized by the Lenders to) execute such documents as may be necessary to
      evidence the release of the Agent’s Liens upon such Collateral; provided,
      however,
      that
      (i) the Agent shall not be required to execute any such document on terms which,
      in the Agent’s opinion, would expose the 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 (other than those
      expressly being released) upon (or obligations of the Borrower in respect of)
      all interests retained by the Borrower, including the proceeds of any sale,
      all
      of which shall continue to constitute part of the Collateral.

     

    8.12.2  Status
      of Agent’s Liens.

     

    The
      Agent
      shall have no obligation whatsoever to any of the Lenders to assure that the
      Collateral exists or is owned by the Borrower or is cared for, protected or
      insured or has been encumbered, or that the Agent’s Liens have been properly or
      sufficiently or lawfully created, perfected, protected or enforced or are
      entitled to any particular priority, or to exercise at all or in any particular
      manner or under any duty of care, disclosure or fidelity, or to continue
      exercising, any of the rights, authorities and powers granted or available
      to
      the Agent pursuant to any of the Financing Documents, it being understood and
      agreed that in respect of the Collateral, or any act, omission or event related
      thereto, the Agent may act in any manner it may deem appropriate, in its sole
      discretion given the Agent’s own interest in the Collateral in its capacity as
      one of the Lenders and that the Agent shall have no other duty or liability
      whatsoever to any Lender as to any of the foregoing.

     

    Section
      8.13  Restrictions
      on Actions by Lenders; Sharing of Payments.

     

    Each
      of
      the Lenders agrees that it shall not, without the express consent of all
      Lenders, and that it shall, to the extent it is lawfully entitled to do so,
      upon
      the request of all Lenders, set off against the Obligations, any amounts owing
      by such Lender to the Borrower or any accounts of the Borrower now or hereafter
      maintained with such Lender. Each of the Lenders further agrees that it shall
      not, unless specifically requested to do so by the Agent, take or cause to
      be
      taken any action to enforce its rights under this Agreement or against the
      Borrower, including the commencement of any legal or equitable proceedings,
      to
      foreclose any Lien on, or otherwise enforce any security interest in, any of
      the
      Collateral.

    
       

      
        
          
          

        

        
          -95-

          
          

        

        
          
          

        

      

    

     

    If
      at any
      time or times any Lender shall receive (i) by payment, foreclosure, setoff
      or
      otherwise, any proceeds of Collateral or any payments with respect to the
      Obligations of the Borrower to such Lender arising under, or relating to, this
      Agreement or the other Financing Documents, except for any such proceeds or
      payments received by such Lender from the Agent pursuant to the terms of this
      Agreement, or (ii) payments from the Agent in excess of such Lender’s
      ratable portion of all such distributions by the Agent, such Lender shall
      promptly (1) turn the same over to the Agent, in kind, and with such
      endorsements as may be required to negotiate the same to the Agent, or in same
      day funds, as applicable, for the account of all of the Lenders and for
      application to the Obligations in accordance with the applicable provisions
      of
      this Agreement, or (2) purchase, without recourse or warranty, an undivided
      interest and participation in the Obligations owed to the other Lenders so
      that
      such excess payment received shall be applied ratably as among the Lenders
      in
      accordance with their Pro Rata Shares; provided,
      however,
      that if
      all or part of such excess payment received by the purchasing party is
      thereafter recovered from it, those purchases of participations shall be
      rescinded in whole or in part, as applicable, and the applicable portion of
      the
      purchase price paid therefor shall be returned to such purchasing party, but
      without interest except to the extent that such purchasing party is required
      to
      pay interest in connection with the recovery of the excess payment.

     

    Section
      8.14  Agency
      for Perfection.

     

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

     

    Section
      8.15  Dissemination
      of Information.

     

    The
      Agent
      will provide the Lenders with any information received by the Agent from the
      Borrower that is required to be provided to the Agent or to the Lenders
      hereunder; provided,
      however,
      that
      the Agent shall not be liable to any one or more the Lenders for any failure
      to
      do so, except to the extent that such failure is attributable to the Agent’s
      gross negligence or willful misconduct as determined by a final non-appealable
      order by a court of competent jurisdiction. 

     

    ARTICLE
      IX

    MISCELLANEOUS

     

    Section
      9.1  Notices.

     

    All
      notices, requests and demands to or upon the parties to this Agreement shall
      be
      in writing and shall be deemed to have been given or made when delivered by
      hand
      on a Business Day, or two (2) days after the date when deposited in the mail,
      postage prepaid by registered or certified mail, return receipt requested,
      or
      when sent by overnight courier, on the Business Day next following the day
      on
      which the notice is delivered to such overnight courier, addressed as
      follows:

    
       

      
        
          
          

        

        
          -96-

          
          

        

        
          
          

        

      

    

    

      
        	
                Borrower:

              	
                Payments
                  Inc.

                1158
                  Broadway

                Hewlett,
                  New York 11557

                Attention: Barry
                  B. Goldstein

              
	 	 
	
                with
                  a copy to:

              	
                Fred
                  Skolnick, Esquire

                Certilman,
                  Balin, Adler & Hyman, LLP

                90
                  Merrick Avenue

                East
                  Meadow, NY 11554

              
	 	 
	
                Agent:

              	
                Manufacturers
                  and Traders Trust Company

                25
                  South Charles Street, 14th
                  Floor

                Baltimore,
                  Maryland 21201

                Attention: Maryanne
                  Gruys

              
	 	 
	
                with
                  a copy to:

              	
                Frederick
                  W. Runge, Jr., Esquire

                Miles
                  & Stockbridge P. C.

                10
                  Light Street

                Baltimore,
                  Maryland 21202

              
	 	 
	
                M&T:

              	
                Manufacturers
                  and Traders Trust Company

                25
                  South Charles Street, 14th
                  Floor

                Baltimore,
                  Maryland 21201

                Attention: Maryanne
                  Gruys

              
	 	 
	
                with
                  a copy to:

              	
                Frederick
                  W. Runge, Jr., Esquire

                Miles
                  & Stockbridge P. C.

                10
                  Light Street

                Baltimore,
                  Maryland 21202

              
	 	 
	
                Other
                  Lenders:

              	
                at
                  the address set forth below their respective
                  signatures

              

      

    

     

    By
      written notice, each party to this Agreement may change the address to which
      notice is given to that party, provided that such changed notice shall include
      a
      street address to which notices may be delivered by overnight courier in the
      ordinary course on any Business Day.

     

    Section
      9.2  Amendments;
      Waivers.

     

    9.2.1  Generally.

     

    This
      Agreement and the other Financing Documents may not be amended, modified, or
      changed in any respect except by an agreement in writing signed by the Agent,
      the Required Lenders and the Borrower, and, to the extent provided in
Section
      9.2.2
      (Consent
      of all Lenders Required), by an agreement in writing signed by the Agent, all
      of
      the Lenders and the Borrower. No waiver of any provision of this Agreement
      or of
      any of the other Financing Documents, nor consent to any departure by the
      Borrower therefrom, shall in any event be effective unless the same shall be
      in
      writing signed by the Required Lenders. No course of dealing between the
      Borrower and the Agent and/or any of the Lenders and no act or failure to act
      from time to time on the part of the Agent and/or any of the Lenders shall
      constitute a waiver, amendment or modification of any provision of this
      Agreement or any of the other Financing Documents or any right or remedy under
      this Agreement, under any of the other Financing Documents or under applicable
      Laws. Without implying any limitation on the foregoing, and subject to the
      provisions of Section
      9.2.2
      (Consent
      of all Lenders Required)

     

    
       

      
        
          
          

        

        
          -97-

          
          

        

        
          
          

        

      

    

    (a)  Any
      waiver or consent shall be effective only in the specific instance, for the
      terms and purpose for which given, subject to such conditions as the Agent
      and
      Lenders may specify in any such instrument.

     

    (b)  No
      waiver
      of any Default or Event of Default shall extend to any subsequent or other
      Default or Event of Default, or impair any right consequent
      thereto.

     

    (c)  No
      notice
      to or demand on the Borrower in any case shall entitle the Borrower to any
      other
      or further notice or demand in the same, similar or other
      circumstance.

     

    (d)  No
      failure or delay by the Lenders to insist upon the strict performance of any
      term, condition, covenant or agreement of this Agreement or of any of the other
      Financing Documents, or to exercise any right, power or remedy consequent upon
      a
      breach thereof, shall constitute a waiver, amendment or modification of any
      such
      term, condition, covenant or agreement or of any such breach or preclude the
      Lenders from exercising any such right, power or remedy at any time or
      times.

     

    (e)  By
      accepting payment after the due date of any amount payable under this Agreement
      or under any of the other Financing Documents, the Lenders shall not be deemed
      to waive the right either to require prompt payment when due of all other
      amounts payable under this Agreement or under any of the other Financing
      Documents, or to declare a default for failure to effect such prompt payment
      of
      any such other amount.

     

    9.2.2  Consent
      of all Lenders Required.

     

    Notwithstanding
      anything to the contrary contained herein, no amendment, modification, change
      or
      waiver shall be effective without the consent of all of the Lenders
      to:

     

    (a)  change
      the Maturity Date or the date of payment of principal of, or interest on, any
      Note;

     

    (b)  reduce
      the principal amount of any Note, the rate of interest thereon or the Fees
      due
      to the Lenders, except as expressly permitted in this Agreement;

     

    (c)  increase
      the Total Revolving Credit Committed Amount, except as expressly permitted
      in
      this Agreement; or

     

    (d)  modify
      this Section
      9.2.2
      or the
      definition of “Required Lenders.”

     

    
       

      
        
          
          

        

        
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    Section
      9.3  Cumulative
      Remedies.

     

    The
      rights, powers and remedies provided in this Agreement and in the other
      Financing Documents are cumulative, may be exercised concurrently or separately,
      may be exercised from time to time and in such order as the Agent shall
      determine, subject to the provisions of this Agreement, and are in addition
      to,
      and not exclusive of, rights, powers and remedies provided by existing or future
      applicable Laws, all without regard to any right of the Borrower or any other
      Person to the marshalling of assets, which right the Borrower and any other
      Person (including, without limitation, the Guarantors) who may be liable (by
      endorsement, guaranty, indemnity or otherwise) for all or any part of the
      Obligations hereby waive to the extent permitted by applicable Laws. In order
      to
      entitle the Agent to exercise any remedy reserved to it in this Agreement,
      it
      shall not be necessary to give any notice, other than such notice as may be
      expressly required in this Agreement. Without limiting the generality of the
      foregoing and subject to the terms of this Agreement, the Agent
      may:

     

    (a)  proceed
      against the Borrower with or without proceeding against any other Person
      (including, without limitation, any one or more of the Guarantors) who may
      be
      liable (by endorsement, guaranty, indemnity or otherwise) for all or any part
      of
      the Obligations;

     

    (b)  proceed
      against the Borrower with or without proceeding under any of the other Financing
      Documents or against any Collateral or other collateral and security for all
      or
      any part of the Obligations;

     

    (c)  without
      reducing or impairing the obligation of the Borrower and without notice, release
      or compromise with any guarantor or other Person liable for all or any part
      of
      the Obligations under the Financing Documents or otherwise;

     

    (d)  without
      reducing or impairing the obligations of the Borrower and without notice
      thereof:

     

    (i)  fail
      to
      perfect the Lien in any or all Collateral or to release any or all the
      Collateral or to accept substitute Collateral;

     

    (ii)  approve
      the making of Advances under this Agreement;

     

    (iii)  waive
      any
      provision of this Agreement or the other Financing Documents;

     

    (iv)  exercise
      or fail to exercise rights of set-off or other rights; or

     

    (v)  accept
      partial payments or extend from time to time the maturity of all or any part
      of
      the Obligations.

    
       

      
        
          
          

        

        
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    Section
      9.4  Severability.

     

    In
      case
      one or more provisions, or part thereof, contained in this Agreement or in
      the
      other Financing Documents shall be invalid, illegal or unenforceable in any
      respect under any Law, then without need for any further agreement, notice
      or
      action:

     

    (a)  the
      validity, legality and enforceability of the remaining provisions shall remain
      effective and binding on the parties thereto and shall not be affected or
      impaired thereby;

     

    (b)  the
      obligation to be fulfilled shall be reduced to the limit of such
      validity;

     

    (c)  if
      such
      provision or part thereof pertains to repayment of the Obligations, then, at
      the
      sole and absolute discretion of the Agent, all of the Obligations of the
      Borrower to the Agent and the Lenders shall become immediately due and payable;
      and

     

    (d)  if
      the
      affected provision or part thereof does not pertain to repayment of the
      Obligations, but operates or would prospectively operate to invalidate this
      Agreement in whole or in part, then such provision or part thereof only shall
      be
      void, and the remainder of this Agreement shall remain operative and in full
      force and effect.

     

    Section
      9.5  Syndication.

     

    (a)  The
      Arranger, in cooperation with the Borrower, will manage all aspects of the
      syndication, including the selection of Lenders, the determination of when
      Arranger will approach potential Lenders, and the final allocations among
      Lenders. The Borrower agrees to assist Arranger actively in achieving a timely
      syndication that is reasonably satisfactory to Arranger, such assistance to
      include, among other things, (i) direct contact during the syndication between
      the Borrower’s senior officers, representatives and advisors, on the one hand,
      and prospective Lenders, on the other hand at such times and places as Arranger
      may reasonably request, (ii) providing to Arranger all financial and other
      information with respect to the Borrower and the transactions contemplated
      that
      Arranger may reasonably request, including but not limited to financial
      projections relating to the foregoing, and (iii) assistance in the preparation
      of a confidential information memorandum and other marketing materials to be
      used in connection with the syndication.

     

    (b)  The
      Arranger shall notify the Agent and the Borrower in writing of the Adjustment
      Date with respect to any new Lender under the provisions of this Section
      9.5.
      On or
      before the Adjustment Date, the Agent, the Borrower and the respective new
      Lender shall execute and deliver a written amendments to this agreement in
      a
      form acceptable to the Agent, and such other documents (including, without
      limitation, a new Note to the order of the new Lender) as the Agent may require
      to reflect the new Lender’s Revolving Credit Committed Amount and the increase
      in the Total Revolving Credit Committed Amount. 

     

    
       

      
        
          
          

        

        
          -100-

          
          

        

        
          
          

        

      

    

    Section
      9.6  Assignments
      by Lenders.

     

    Any
      Lender may, with the prior written consent of the Agent (which consent shall
      not
      be unreasonably withheld), but without notice to or consent of the Borrower,
      assign to any Person (each an “Assignee” and collectively, the “Assignees”) all
      or a portion of such Lender’s Commitments; provided that, unless the Lender has
      assigned all of its Commitments, after giving effect to such assignment, such
      Lender must continue to hold a Pro Rata Share of the Commitments at least equal
      to Five Million Dollars ($5,000,000). Any Lender that elects to make such an
      assignment shall pay to the Agent, for the exclusive benefit of the Agent,
      an
      administrative fee for processing each such assignment in the amount of Three
      Thousand Five Hundred Dollars ($3,500.00). Such Lender and its Assignee shall
      notify the Agent and the Borrower in writing of the date on which the assignment
      is to be effective (the “Adjustment Date”). On or before the Adjustment Date,
      the assigning Lender, the Agent, the Borrower and the respective Assignee shall
      execute and deliver a written assignment agreement in a form acceptable to
      the
      Agent, which shall constitute an amendment to this Agreement to the extent
      necessary to reflect such assignment. Upon the request of any assigning Lender
      following an assignment made in accordance with this Section
      9.6,
      the
      Borrower shall issue new Notes to the assigning Lender and its Assignee
      reflecting such assignment, in exchange for the existing Notes held by the
      assigning Lender.

     

    In
      addition, notwithstanding the foregoing, any Lender may at any time pledge
      all
      or any portion of such Lender’s rights under this Agreement, any of the
      Commitments or any of the Obligations to a Federal Reserve Bank.

     

    Section
      9.7  Participations
      by Lenders.

     

    Any
      Lender may at any time sell to one or more financial institutions participating
      interests in any of such Lender’s Obligations or Commitments; provided, however,
      that (a) no such participation shall relieve such Lender from its obligations
      under this Agreement or under any of the other Financing Documents to which
      it
      is a party, (b) such Lender shall remain solely responsible for the performance
      of its obligations under this Agreement and under all of the other Financing
      Documents to which it is a party, and (c) the Borrower, the Agent 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 and
      the other Financing Documents.

     

    Section
      9.8  Disclosure
      of Information by Lenders.

     

    In
      connection with any transaction contemplated by Section
      9.5
      (Remaining Syndication) sale, transfer, assignment or participation by any
      Lender in accordance with Section
      9.6
      (Assignments by Lenders) or Section
      9.7
      (Participations by Lenders), each Lender shall have the right to disclose to
      any
      actual or potential Lender, purchaser, assignee, transferee or participant
      all
      financial records, information, reports, financial statements and documents
      obtained in connection with this Agreement and/or any of the other Financing
      Documents or otherwise.

     

    Section
      9.9  Successors
      and Assigns.

     

    This
      Agreement and all other Financing Documents shall be binding upon and inure
      to
      the benefit of the Borrower, the Agent and the Lenders and their respective
      successors and assigns, except that the Borrower shall not have the right to
      assign its rights hereunder or any interest herein without the prior written
      consent of the Agent and the Required Lenders of the Lenders.

     

    
       

      
        
          
          

        

        
          -101-

          
          

        

        
          
          

        

      

    

    Section
      9.10  Continuing
      Agreements.

     

    All
      covenants, agreements, representations and warranties made by the Borrower
      in
      this Agreement, in any of the other Financing Documents, and in any certificate
      delivered pursuant hereto or thereto shall survive the making by the Lenders
      of
      the Loans and the execution and delivery of the Notes, shall be binding upon
      the
      Borrower regardless of how long before or after the date hereof any of the
      Obligations were or are incurred, and shall continue in full force and effect
      so
      long as any of the Obligations are outstanding and unpaid. From time to time
      upon the Agent’s request, and as a condition of the release of any one or more
      of the Security Documents, the Borrower and other Persons obligated with respect
      to the Obligations shall provide the Agent with such acknowledgments and
      agreements as the Agent may require to the effect that there exists no defenses,
      rights of setoff or recoupment, claims, counterclaims, actions or causes of
      action of any kind or nature whatsoever against the Agent, any Agent-Related
      Persons, any or all of the Lenders, and/or any of its or their agents and
      others, or to the extent there are, the same are waived and
      released.

     

    Section
      9.11  Enforcement
      Costs.

     

    The
      Borrower agrees to pay to the Agent on demand all Enforcement Costs, together
      with interest thereon from the date incurred or advanced until paid in full
      at a
      per annum rate of interest equal at all times to the Post-Default Rate.
      Enforcement Costs shall be immediately due and payable at the time advanced
      or
      incurred, whichever is earlier. Without implying any limitation on the
      foregoing, the Borrower agrees, as part of the Enforcement Costs, to pay upon
      demand any and all stamp and other Taxes and fees payable or determined to
      be
      payable in connection with the execution and delivery of this Agreement and
      the
      other Financing Documents and to save the Agent and the Lenders harmless from
      and against any and all liabilities with respect to or resulting from any delay
      in paying or omission to pay any Taxes or fees referred to in this Section.
      The
      provisions of this Section shall survive the execution and delivery of this
      Agreement, the repayment of the other Obligations and shall survive the
      termination of this Agreement.

     

    Section
      9.12  Applicable
      Law; Jurisdiction.

     

    9.12.1  Applicable
      Law.

     

    As
      a
      material inducement to the Agent and the Lenders to enter into this Agreement,
      the Borrower acknowledges and agrees that the Financing Documents, including,
      this Agreement, shall be governed by the Laws of the State, as if each of the
      Financing Documents and this Agreement had each been executed, delivered,
      administered and performed solely within the State even though for the
      convenience and at the request of the Borrower, one or more of the Financing
      Documents may be executed elsewhere. The Agent and the Lenders acknowledge,
      however, that remedies under certain of the Financing Documents that relate
      to
      property outside the State may be subject to the laws of the state in which
      the
      property is located.

     

    
       

      
        
          
          

        

        
          -102-

          
          

        

        
          
          

        

      

    

    9.12.2  Submission
      to Jurisdiction.

     

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

     

    9.12.3  Service
      of Process.

     

    The
      Borrower hereby consents to process being served in any suit, action or
      proceeding of the nature referred to in this Section by (a) the mailing of
      a
      copy thereof by registered or certified mail, postage prepaid, return receipt
      requested, to the Borrower at the Borrower’s address designated in or pursuant
      to Section
      9.1
      (Notices), and (b) serving a copy thereof upon the agent, if any, designated
      and
      appointed by the Borrower as the Borrower’s agent for service of process by or
      pursuant to this Section. The Borrower irrevocably agrees that such service
      (y)
      shall be deemed in every respect effective service of process upon the Borrower
      in any such suit, action or proceeding, and (z) shall, to the fullest extent
      permitted by law, be taken and held to be valid personal service upon the
      Borrower. Nothing in this Section shall affect the right of the Agent to serve
      process in any manner otherwise permitted by law or limit the right of the
      Agent
      otherwise to bring proceedings against the Borrower in the courts of any
      jurisdiction or jurisdictions.

     

    Section
      9.13  Duplicate
      Originals and Counterparts.

     

    This
      Agreement may be executed in any number of duplicate originals or counterparts,
      each of such duplicate originals or counterparts shall be deemed to be an
      original and all taken together shall constitute but one and the same
      instrument..

     

    Section
      9.14  No
      Agency.

     

    Nothing
      herein contained shall be construed to constitute the Borrower as the agent
      of
      the Agent or any of the Lenders for any purpose whatsoever or to permit the
      Borrower to pledge any of the credit of the Agent or any of the Lenders. Neither
      the Agent nor any of the Lenders shall be responsible or liable for any
      shortage, discrepancy, damage, loss or destruction of any part of the Collateral
      wherever the same may be located and regardless of the cause thereof. Neither
      the Agent nor any of the Lenders shall, by anything herein or in any of the
      Financing Documents or otherwise, assume any of the Borrower’s obligations under
      any contract or agreement assigned to the Agent and/or the Lenders, and neither
      the Agent nor any of the Lenders shall be responsible in any way for the
      performance by the Borrower of any of the terms and conditions
      thereof.

    
       

      
        
          
          

        

        
          -103-

          
          

        

        
          
          

        

      

    

     

    Section
      9.15  Date
      of Payment.

     

    Should
      the principal of or interest on the Notes become due and payable on other than
      a
      Business Day, the maturity thereof shall be extended to the next succeeding
      Business Day and in the case of principal, interest shall be payable thereon
      at
      the rate per annum specified in the Notes during such extension.

     

    Section
      9.16  Entire
      Agreement.

     

    This
      Agreement is intended by the Agent, the Lenders and the Borrower to be a
      complete, exclusive and final expression of the agreements contained herein.
      Neither the Agent, the Lenders nor the Borrower shall hereafter have any rights
      under any prior agreements pertaining to the matters addressed by this Agreement
      but shall look solely to this Agreement for definition and determination of
      all
      of their respective rights, liabilities and responsibilities under this
      Agreement.

     

    Section
      9.17  Waiver
      of Trial by Jury.

     

    THE
      BORROWER, THE AGENT AND THE LENDERS HEREBY JOINTLY AND SEVERALLY WAIVE TRIAL
      BY
      JURY IN ANY ACTION OR PROCEEDING TO WHICH THE BORROWER AND THE AGENT AND/OR
      ANY
      OR ALL OF THE LENDERS MAY BE PARTIES, ARISING OUT OF OR IN ANY WAY PERTAINING
      TO
      (A) THIS AGREEMENT, (B) ANY OF THE FINANCING DOCUMENTS, OR (C) THE COLLATERAL.
      THIS WAIVER CONSTITUTES A WAIVER OF TRIAL BY JURY OF ALL CLAIMS AGAINST ALL
      PARTIES TO SUCH ACTIONS OR PROCEEDINGS, INCLUDING CLAIMS AGAINST PARTIES WHO
      ARE
      NOT PARTIES TO THIS AGREEMENT.

     

    This
      waiver is knowingly, willingly and voluntarily made by the Borrower, the Agent
      and the Lenders, and the Borrower, the Agent and the Lenders hereby represent
      that no representations of fact or opinion have been made by any individual
      to
      induce this waiver of trial by jury or to in any way modify or nullify its
      effect. The Borrower, the Agent and the Lenders further represent that they
      have
      been represented in the signing of this Agreement and in the making of this
      waiver by independent legal counsel, selected of their own free will, and that
      they have had the opportunity to discuss this waiver with counsel.

     

    Section
      9.18  Liability
      of the Agent and the Lenders.

     

    The
      Borrower hereby agrees that neither the Agent nor any of the Lenders shall
      be
      chargeable for any negligence, mistake, act or omission of any accountant,
      examiner, agency or attorney employed by the Agent and/or any of the Lenders
      in
      making examinations, investigations or collections, or otherwise in perfecting,
      maintaining, protecting or realizing upon any lien or security interest or
      any
      other interest in the Collateral or other security for the
      Obligations.

     

    By
      inspecting the Collateral or any other properties of the Borrower or by
      accepting or approving anything required to be observed, performed or fulfilled
      by the Borrower or to be given to the Agent and/or any of the Lenders pursuant
      to this Agreement or any of the other Financing Documents, neither the Agent
      nor
      any of the Lenders shall be deemed to have warranted or represented the
      condition, sufficiency, legality, effectiveness or legal effect of the same,
      and
      such acceptance or approval shall not constitute any warranty or representation
      with respect thereto by the Agent and/or the Lenders.

    
       

      
        
          
          

        

        
          -104-

          
          

        

        
          
          

        

      

    

     

    Section
      9.19  Indemnification.

     

    The
      Borrower agrees to indemnify and hold harmless, the Agent, the Lenders, the
      respective parent and Affiliates of the Agent and the Lenders and the respective
      parent’s and Affiliates’ officers, directors, shareholders, employees and agents
      (each an “Indemnified Party;” and collectively, the “Indemnified Parties”), from
      and against any and all claims, liabilities, losses, damages, costs and expenses
      (whether or not such Indemnified Party is a party to any litigation), including
      without limitation, reasonable attorney’s fees and costs and costs of
      investigation, document production, attendance at depositions or other
      discovery, incurred by any Indemnified Party with respect to, arising out of
      or
      as a consequence of (a) this Agreement or any of the other Financing Documents,
      including without limitation, any failure of the Borrower to pay when due (at
      maturity, by acceleration or otherwise) any principal, interest, fee or any
      other amount due under this Agreement or the other Loan documents, or any other
      Event of Default; (b) the use by the Borrower of any proceeds advanced
      hereunder; (c) the transactions contemplated hereunder; or (d) any claim,
      demand, action or cause of action being asserted against (i) the Borrower or
      any
      of its Affiliates by any other Person, or (ii) any Indemnified Party by the
      Borrower in connection with the transactions contemplated hereunder (the
      foregoing collectively, the “Indemnified Liabilities”). Notwithstanding anything
      herein or elsewhere to the contrary, the Borrower shall not be obligated to
      indemnify or hold harmless any Indemnified Party from any liability, loss or
      damage resulting from the gross negligence or willful misconduct (as determined
      by a final non-appealable order by a court of competent jurisdiction) of such
      Indemnified Party. Any amount payable to the Agent and/or the Lenders under
      this
      Section will bear interest at the Post-Default Rate from the due date until
      paid.

     

     

    [Signatures
      follow on next page]

     

    

    
      
        
           

        

        
        

      

      
        
        

        
        

      

      
        
        

        
           

        

      

    

    Signature
      Page to 

    Financing
      and Security Agreement among

    Payments
      Inc. and DCAP Group, Inc., Borrower

    Manufacturers
      and Traders Trust Company, Agent

    and

    Certain
      Lenders

     

    IN
      WITNESS WHEREOF, each of the parties hereto have executed and delivered this
      Agreement under their respective seals as of the day and year first written
      above.

     

    

      
        	
                WITNESS:

                 

                _____________

              	
                PAYMENTS
                  INC.

                 

                By:_______________(Seal)

                Barry
                  B. Goldstein

                President

              
	 	 
	
                WITNESS:

                 

                ____________

              	
                DCAP
                  GROUP, INC.

                 

                By:______________(Seal)

                Barry
                  B. Goldstein

                President

              
	 	 
	
                WITNESS:

                 

                 

                ___________

                 

              	
                MANUFACTURERS
                  AND TRADERS

                TRUST
                  COMPANY

                in
                  its capacity as Agent

                 

                By:_____________(Seal)

                Maryanne
                  Gruys

                Vice
                  President

              
	 	 
	
                WITNESS:

                 

                 

                ___________

                 

              	
                MANUFACTURERS
                  AND TRADERS

                TRUST
                  COMPANY

                in
                  its capacity as a Lender

                 

                By:_____________(Seal)

                Maryanne
                  Gruys

                Vice
                  President

              

      

    
      
         

        
        

      

      
        
        

        
        

      

      
        
        

      

    

    LIST
      OF EXHIBITS

     

    A-1. Revolving
      Credit Note

     

    A-2 Form
      of
      Term Line Note

     

    A-3 Commitments

     

    B. Perfection
      Certificate

     

    C. Form
      of
      Compliance Certificate

     

    D. Borrower
      Financial Reports and Information

     

    E. Carrier
      Eligibility

     

    F. Form
      of
      Premium Finance Agreement

     

    G. Premium
      Finance Licenses

     

    LIST
      OF SCHEDULES

     

    Schedule
      4.1.10 Litigation

     

    Schedule
      4.1.13 Indebtedness
      for Borrowed Money

     

    Schedule
      4.1.20 Employee
      Relations

     

    Schedule
      4.1.22 Perfection
      and Priority of Collateral

     

    
      
        
        

      

      
        
        

        
        

      

      
        
        

      

    

     

    TABLE
      OF CONTENTS

     

     

    ARTICLE
      I DEFINITIONS

    Section
      1.1 Certain
      Defined Terms.

    Section
      1.2 Accounting
      Terms and Other Definitional Provisions.

    Section
      1.3 Interpretive
      Provisions.

     

    ARTICLE
      II
      THE CREDIT FACILITIES

    Section
      2.1 The
      Revolving Credit Facility.

    2.1.1 The
      Revolving Loan.

    2.1.2 Requests
      for Advances.

    2.1.3 Computation
      of Borrowing Base.

    2.1.4 Agent’s
      Election.

    2.1.5 Borrowing
      Base Report.

    2.1.6 Revolving
      Credit Notes.

    2.1.7 Mandatory
      Prepayments of Revolving Loan.

    2.1.8 Optional
      Prepayments of Revolving Loan.

    2.1.9 Collateral
      Account.

    2.1.10 Revolving
      Loan Account.

    2.1.11 Revolving
      Credit Unused Line Fee.

    2.1.12 Early
      Termination Fee.

    Section
      2.2 The
      Term
      Line Facility.

    2.2.1 The
      Term
      Line.

    2.2.2 Term
      Line
      Procedures.

    2.2.3 Term
      Line
      Notes.

    2.2.4 Payments
      of Term Line.

    2.2.5 Term
      Line
      Maturity.

    2.2.6 Optional
      Prepayments of Term Line.

    Section
      2.3 Certain
      Interest and Fee Provisions.

    2.3.1 Payment
      of Interest.

    2.3.2 Arrangement
      Fee.

    2.3.3 Monitoring
      Fees.

    2.3.4 Computation
      of Interest and Fees.

    2.3.5 Maximum
      Interest Rate.

    2.3.6 Liens;
      Setoff

    2.3.7 Requirements
      of Law.

    Section
      2.4 Interest.

    2.4.1 Applicable
      Interest Rate - Term Line.

    2.4.2 Applicable
      Interest Rate - Revolving Loan.

    2.4.3 Selection
      of Interest Rates.

    2.4.4 Inability
      to Determine LIBOR Base Rate.

    2.4.5 Indemnity.

    2.4.6 Payment
      of Interest.

    Section
      2.5 General
      Financing Provisions.

    2.5.1 Borrower’s
      Representatives.

    2.5.2 Use
      of
      Proceeds of the Loans.

    2.5.3 Payments
      by Borrower.

    2.5.4 Bank
      Products.

    2.5.5 Joint
      and
      Several Liability.

    2.5.6 Contribution
      and Indemnification among the Borrowers.

    2.5.7 Agency
      of
      Payments Inc.

    Section
      2.6 Funding
      of Advances.

    2.6.1 Advances
      by Lenders.

    2.6.2 M&T
      Advances.

    2.6.3 Agent
      Advances.

    2.6.4 Overadvances.

    2.6.5 No
      Novation.

    Section
      2.7 Settlement
      Among Lenders.

    2.7.1 Term
      Line
      Settlement.

    2.7.2 Revolving
      Loan Settlement.

    2.7.3 Settlement
      of Other Obligations.

    2.7.4 Presumption
      of Payment.

     

    ARTICLE
      III
      THE COLLATERAL

    Section
      3.1 Debt
      and
      Obligations Secured.

    Section
      3.2 Grant
      of
      Liens.

    Section
      3.3 Perfection
      Certificate.

    Section
      3.4 Personal
      Property.

    3.4.1 Promissory
      Notes, etc.

    3.4.2 Patents,
      Copyrights and Other Property Requiring Additional Steps to
      Perfect.

    Section
      3.5 Record
      Searches.

    Section
      3.6 Real
      Property.

    Section
      3.7 Costs.

    Section
      3.8 Release.

    Section
      3.9 Inconsistent
      Provisions.

     

    ARTICLE
      IV
      REPRESENTATIONS AND WARRANTIES

    Section
      4.1 Representations
      and Warranties.

    4.1.1 Subsidiaries.

    4.1.2 Good
      Standing.

    4.1.3 Power
      and
      Authority.

    4.1.4 Binding
      Agreements.

    4.1.5 No
      Conflicts.

    4.1.6 No
      Defaults, Violations.

    4.1.7 Compliance
      with Laws.

    4.1.8 Margin
      Stock.

    4.1.9 Investment
      Company Act; Margin Securities.

    4.1.10 Litigation.

    4.1.11 Financial
      Condition.

    4.1.12 Full
      Disclosure.

    4.1.13 Indebtedness
      for Borrowed Money.

    4.1.14 Parent
      Subordinated Debt.

    4.1.15 Taxes.

    4.1.16 ERISA.

    4.1.17 Title
      to
      Properties.

    4.1.18 Patents,
      Trademarks, Etc.

    4.1.19 Premium
      Finance Licenses.

    4.1.20 Employee
      Relations.

    4.1.21 Presence
      of Hazardous Materials or Hazardous Materials Contamination.

    4.1.22 Perfection
      and Priority of Collateral.

    4.1.23 Places
      of
      Business and Location of Collateral.

    4.1.24 Business
      Information.

    4.1.25 Equipment.

    4.1.26 Receivables.

    4.1.27 Compliance
      with Eligibility Standards.

    4.1.28 Original
      Financing Agreement.

    4.1.29 Solvency

    Section
      4.2 Survival;
      Updates of Representations and Warranties.

     

    ARTICLE
      V
      CONDITIONS PRECEDENT

    Section
      5.1 Conditions
      to the Initial Advance.

    5.1.1 Organizational
      Documents - Borrower.

    5.1.2 Opinion
      of Borrower’s Counsel.

    5.1.3 Organizational
      Documents - Corporate Guarantor.

    5.1.4 Consents,
      Licenses, Approvals, Etc.

    5.1.5 Notes.

    5.1.6 Financing
      Documents and Collateral.

    5.1.7 Other
      Financing Documents.

    5.1.8 Documents,
      Etc.

    5.1.9 Payment
      of Fees.

    5.1.10 Perfection
      Certificate.

    5.1.11 Recordings
      and Filings.

    5.1.12 Insurance
      Certificate.

    5.1.13 Bailee
      Acknowledgements.

    5.1.14 Field
      Examination.

    5.1.15 Life
      Insurance.

    5.1.16 Subordination
      Agreement.

    5.1.17 Servicing
      Agreement; Back-Up Servicing Agent.

    5.1.18 Servicing.

    Section
      5.2 Conditions
      to all Extensions of Credit.

    5.2.1 Compliance.

    5.2.2 Borrowing
      Base.

    5.2.3 Default.

    5.2.4 Representations
      and Warranties.

    5.2.5 Adverse
      Change.

    5.2.6 Legal
      Matters.

    5.2.7 Consents,
      Licenses, Approvals, Etc.

     

    ARTICLE
      VI
      COVENANTS OF THE BORROWER

    Section
      6.1 Affirmative
      Covenants.

    6.1.1 Financial
      Statements.

    6.1.2 Reports
      to SEC and to Stockholders.

    6.1.3 Recordkeeping,
      Rights of Inspection, Field Examination, Etc.

    6.1.4 Corporate
      Existence.

    6.1.5 Compliance
      with Laws.

    6.1.6 Preservation
      of Properties.

    6.1.7 Line
      of
      Business.

    6.1.8 Insurance.

    6.1.9 Taxes.

    6.1.10 ERISA.

    6.1.11 Notification
      of Events of Default and Adverse Developments.

    6.1.12 Hazardous
      Materials; Contamination.

    6.1.13 Disclosure
      of Significant Transactions.

    6.1.14 Key
      Man
      Life Insurance.

    6.1.15 Financial
      Covenants.

    6.1.16 Collection
      of Receivables.

    6.1.17 Assignments
      of Receivables.

    6.1.18 Notice
      of
      Commercial Tort Claims.

    6.1.19 Insurance
      With Respect to Equipment.

    6.1.20 Maintenance
      of the Collateral.

    6.1.21 Equipment.

    6.1.22 Further
      Assurances; Defense of Title.

    6.1.23 Business
      Information.

    6.1.24 Subsequent
      Opinion of Counsel as to Recording Requirements.

    6.1.25 Use
      of
      Premises and Equipment.

    6.1.26 Protection
      of Collateral.

    6.1.27 Appraisals.

    6.1.28 Servicing
      Agreements.

    6.1.29 Borrower’s
      Procedures.

    6.1.30 Amendment
      to Subordinated Indebtedness.

    Section
      6.2 Negative
      Covenants.

    6.2.1 Capital
      Structure, Merger, Acquisition or Sale of Assets.

    6.2.2 Subsidiaries.

    6.2.3 Issuance
      of Stock.

    6.2.4 Purchase
      or Redemption of Securities, Dividend Restrictions.

    6.2.5 Indebtedness.

    6.2.6 Investments,
      Loans and Other Transactions.

    6.2.7 Operating
      Lease Obligations.

    6.2.8 Stock
      of
      Subsidiaries.

    6.2.9 Subordinated
      Indebtedness.

    6.2.10 Liens.

    6.2.11 Transactions
      with Affiliates.

    6.2.12 Other
      Businesses.

    6.2.13 ERISA
      Compliance.

    6.2.14 Prohibition
      on Hazardous Materials.

    6.2.15 Amendments.

    6.2.16 Method
      of
      Accounting; Fiscal Year.

    6.2.17 Compensation.

    6.2.18 Transfer
      of Collateral.

    6.2.19 Sale
      and
      Leaseback.

    6.2.20 Disposition
      of Collateral.

     

    ARTICLE
      VII
      DEFAULT AND RIGHTS AND REMEDIES

    Section
      7.1 Events
      of
      Default.

    7.1.1 Failure
      to Pay.

    7.1.2 Breach
      of
      Representations and
      Warranties.

    7.1.3 Failure
      to Comply with Covenants.

    7.1.4 Default
      Under Other Financing Documents or Obligations.

    7.1.5 Receiver;
      Bankruptcy.

    7.1.6 Involuntary
      Bankruptcy, etc.

    7.1.7 Judgment.

    7.1.8 Execution;
      Attachment.

    7.1.9 Default
      Under Other Borrowings.

    7.1.10 Challenge
      to Agreements.

    7.1.11 Material
      Adverse Effect Change.

    7.1.12 Change
      of
      Control.

    7.1.13 Liquidation,
      Termination, Dissolution, Change in Management, etc.

    7.1.14 Subordinated
      Debt (Parent).

    Section
      7.2 Remedies.

    7.2.1 Acceleration.

    7.2.2 Further
      Advances.

    7.2.3 Uniform
      Commercial Code.

    7.2.4 Specific
      Rights With Regard to Collateral.

    7.2.5 Application
      of Proceeds.

    7.2.6 Performance
      by Agent.

    7.2.7 Other
      Remedies.

     

    ARTICLE
      VIII
      THE AGENT

    Section
      8.1 Appointment
      and Authorization.

    Section
      8.2 Nature
      of
      Duties

    8.2.1 In
      General.

    8.2.2 Delegation
      of Duties.

    8.2.3 Express
      Authorization

    Section
      8.3 Liability
      of Agent.

    Section
      8.4 Reliance
      by Agent.

    Section
      8.5 Notice
      of
      Default.

    Section
      8.6 Credit
      Decision.

    Section
      8.7 Indemnification.

    Section
      8.8 Agent
      in
      Individual Capacity.

    Section
      8.9 Successor
      Agent.

    Section
      8.10 Status
      of
      Lenders.

    Section
      8.11 Withholding
      Tax.

    Section
      8.12 Collateral
      Matters.

    8.12.1 Release
      of Collateral.

    8.12.2 Status
      of
      Agent’s Liens.

    Section
      8.13 Restrictions
      on Actions by Lenders; Sharing of Payments.

    Section
      8.14 Agency
      for Perfection.

    Section
      8.15 Dissemination
      of Information.

     

    ARTICLE
      IX
      MISCELLANEOUS

    Section
      9.1 Notices.

    Section
      9.2 Amendments;
      Waivers.

    9.2.1 Generally.

    9.2.2 Consent
      of all Lenders Required.

    Section
      9.3 Cumulative
      Remedies.

    Section
      9.4 Severability.

    Section
      9.5 Syndication.

    Section
      9.6 Assignments
      by Lenders.

    Section
      9.7 Participations
      by Lenders.

    Section
      9.8 Disclosure
      of Information by Lenders.

    Section
      9.9 Successors
      and Assigns.

    Section
      9.10 Continuing
      Agreements.

    Section
      9.11 Enforcement
      Costs.

    Section
      9.12 Applicable
      Law; Jurisdiction.

    9.12.1 Applicable
      Law.

    9.12.2 Submission
      to Jurisdiction.

    9.12.3 Service
      of Process.

    Section
      9.13 Duplicate
      Originals and Counterparts.

    Section
      9.14 No
      Agency.

    Section
      9.15 Date
      of
      Payment.

    Section
      9.16 Entire
      Agreement.

    Section
      9.17 Waiver
      of
      Trial by Jury.

    Section
      9.18 Liability
      of the Agent and the Lenders.

    Section
      9.19 Indemnification.

     

    EXHIBIT
      A-1 - REVOLVING CREDIT NOTE

     

    EXHIBIT
      A-2 - TERM LINE NOTE

     

    EXHIBIT
      A-3 - COMMITMENTS

    

     

    

    
      
        
          i

          1882897.1

        

        
        

      

      
        
        

        
        

      

      
        
        

        
          

          

        

      

    

     

    FINANCING
      AND SECURITY AGREEMENT

     

    Dated
      July __, 2006

     

     

    By
      and
      Among

     

     

    PAYMENTS
      INC., 

     

     

    as
      Borrower,

     

     

    MANUFACTURERS
      AND TRADERS TRUST COMPANY,

     

     

    as
      Agent

     

     

    MANUFACTURERS
      AND TRADERS TRUST COMPANY, INVESTMENT BANKING GROUP

     

     

    as
      Sole
      Lead Arranger

     

     

    

     

     

    and
      the
      Lenders partiesExhibit 10(h) Amended and Restated Revolving Credit Note, dated July 28, 2006
      in the principal amount of $20,000,000

    AMENDED
      AND RESTATED

    REVOLVING
      CREDIT NOTE

    (M&T)

     

    
      
        	
                $20,000,000

              	
                Baltimore,
                  Maryland

              
	 	
                July
                  28, 2006

              

      

    

     

    FOR
      VALUE
      RECEIVED, PAYMENTS INC., a corporation organized under the laws the State of
      New
      York (“Payments
      Inc.”),
      and
      DCAP GROUP, INC., a corporation organized and existing under the laws of the
      State of Delaware (“Parent”),
      of
      which Payments Inc. is a wholly-owned subsidiary, jointly and severally (the
      “Borrower”),
      promises to pay to the order of MANUFACTURERS AND TRADERS TRUST COMPANY, a
      New
      York State Bank organized under the laws of the State of New York (the
“Lender”),
      the
      principal sum of TWENTY MILLION DOLLARS
      ($20,000,000) (the “Principal
      Sum”),
      or
      such lesser amount equal to the Lender’s Revolving Credit Pro Rata Share (as
      that term is defined in the “Financing
      Agreement”
defined
      below) of the Revolving Credit Facility (as that term is defined in the
      Financing Agreement) or so much thereof as has been or may be advanced and/or
      readvanced to or for the account of the Borrower under the Revolving Credit
      Facility (as that term is defined in the Financing Agreement) pursuant to the
      terms and conditions of the Financing Agreement, together with interest thereon
      at the rate or rates hereinafter provided, in accordance with the
      following:

     

    
      	1.  	
              Interest.

            

    

     

    Commencing
      as of the date hereof and continuing until repayment in full of all sums due
      hereunder, the unpaid Principal Sum shall bear interest at the Applicable
      Interest Rate or the Post-Default Rate (both as defined in the Financing
      Agreement) in effect from time to time for the Revolving Loan (as defined in
      the
      Financing Agreement). The Applicable Interest Rate shall be determined in the
      manner provided in the Financing Agreement.

     

    
      	2.  	
              Payments
                and Maturity.

            

    

     

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

     

    (a)  Interest
      only on the unpaid Principal Sum shall be due and payable at the times provided
      in the Financing Agreement, Section 2.3.1 (Payment of Interest) of the Financing
      Agreement being the current provision therefor; and

     

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

     

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

     

    
      
        
        

      

      
        
        

        
        

      

      
        
        

      

    

    
      	3.  	
              Default
                Interest.

            

    

     

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

     

    
      	4.  	
              Late
                Charges.

            

    

     

    If
      the
      Borrower shall fail to make any payment under the terms of this Note (other
      than
      a payment due at maturity) within five (5) days after the date such payment
      is
      due, the Borrower shall pay to the Lender on demand a late charge equal to
      five
      percent (5%) of the delinquent amount. 

     

    
      	5.  	
              Application
                and Place of Payments.

            

    

     

    All
      payments made on account of this Note shall be applied in the manner provided
      in
      the Financing Agreement. All payments on account of this Note shall be paid
      in
      lawful money of the United States of America in immediately available funds
      during regular business hours of Manufacturers and Traders Trust Company, a
      New
      York State Bank (the “Agent”
under
      the Financing Agreement), at the Agent’s office at 25 South Charles Street,
      Baltimore, Maryland 21201, or at such other times and places as the Agent may
      at
      any time and from time to time designate in writing to the
      Borrower.

     

    
      	6.  	
              Prepayment.

            

    

     

    The
      Borrower may prepay the Principal Sum at the times and in the manner provided
      in
      the Financing Agreement.

     

    
      	7.  	
              Financing
                Agreement and Other Financing
                Documents.

            

    

     

    This
      Note
      is a “Revolving
      Credit Note”
      described in an Amended and Restated Financing and Security Agreement dated
      July
      28, 2006 (as amended, modified, restated, substituted, extended and renewed
      at
      any time and from time to time, the “Financing Agreement”), by and among the
      Borrower, the Agent, the Lender, and the other Lenders under the Financing
      Agreement. The indebtedness evidenced by this Note is included within the
      meaning of the term “Obligations”
as
      defined in the Financing Agreement. The term “Financing
      Documents”
as
      used
      in this Note shall have the meaning set forth in the Financing Agreement. All
      terms used in this Note which are not otherwise defined herein shall have the
      meaning set forth in the Financing Agreement.

     

    
      	8.  	
              Security.

            

    

     

    This
      Note
      is secured as provided in the Financing Agreement.

     

    
      	9.  	
              Events
                of Default.

            

    

     

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

     

     

    
      
        2

      

      
        
        

        
        

      

      
        
        

      

    

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

     

    (b)  The
      occurrence of an Event of Default (as that term is defined in the Financing
      Agreement).

     

    
      	10.  	
              Remedies.

            

    

     

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

     

    
      	11.  	
              Confessed
                Judgment.

            

    

     

    Upon
      the
      occurrence of an Event of Default, the Borrower hereby authorizes any attorney
      designated by the Lender or any clerk of any court of record to appear for
      the
      Borrower in any court of record and confess judgment without prior hearing
      against the Borrower in favor of the Lender for and in the amount of the unpaid
      Principal Sum, all interest accrued and unpaid thereon, all other amounts
      payable by the Borrower to the Lender under the terms of this Note or any of
      the
      other Financing Documents, costs of suit, and attorneys’ fees of fifteen percent
      (15%) of the unpaid Principal Sum and interest then due hereunder. By its
      acceptance of this note, the Lender agrees that in the event the Lender
      exercises at any time its right to confess judgment under this note, the Lender
      shall use its best efforts to obtain legal counsel who will charge the Lender
      for its services on an hourly basis, at its customary hourly rates and only
      for
      the time and reasonable expenses incurred. In no event shall the Lender enforce
      the legal fees portion of a confessed judgment award for an amount in excess
      of
      the fees and expenses actually charged to the Lender for services rendered
      by
      its counsel in connection with such confession of judgment and/or the collection
      of sums owed to the Lender. In the event the Lender receives, through execution
      upon a confessed judgment, payments on account of attorneys’ fees in excess of
      such actual attorneys’ fees and expenses incurred by the Lender, then, after
      full repayment and satisfaction of all of the obligations under and in
      connection with this note, the loan agreement and all of the other loan
      documents, the Lender shall refund such excess amount to the Borrower. The
      Borrower hereby releases, to the extent permitted by applicable law, all errors
      and all rights of exemption, appeal, stay of execution, inquisition, and other
      rights to which the Borrower may otherwise be entitled under the laws of the
      United States of America or of any state or possession of the United States
      of
      America now in force and which may hereafter be enacted. The authority and
      power
      to appear for and enter judgment against the Borrower shall not be exhausted
      by
      one or more exercises thereof or by any imperfect exercise thereof and shall
      not
      be extinguished by any judgment entered pursuant thereto. Such authority may
      be
      exercised on one or more occasions or from time to time in the same or different
      jurisdictions as often as the Lender shall deem necessary or desirable, for
      all
      of which this Note shall be a sufficient warrant.

     

    
       

      
        
          3

        

        
          
          

          
          

        

        
          
          

        

      

    

     

    
      	12.  	
              Expenses.

            

    

     

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

     

    
      	13.  	
              Notices.

            

    

     

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

     

    
      	14.  	
              Miscellaneous.

            

    

     

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

     

    
      	15.  	
              Partial
                Invalidity.

            

    

     

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

     

    
      	16.  	
              Captions.

            

    

     

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

    
       

      
        
          4

        

        
          
          

          
          

        

        
          
          

        

      

    

     

    
      	17.  	
              Applicable
                Law.

            

    

     

    The
      Borrower acknowledges and agrees that this Note shall be governed by the laws
      of
      the State of Maryland (but not including the conflict of law rules thereof),
      even though for the convenience and at the request of the Borrower, this Note
      may be executed elsewhere, all as if this Note had been executed, delivered,
      administered and performed solely within the State of Maryland.

     

    
      	18.  	
              Consent
                to Jurisdiction.

            

    

     

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

     

    
      	19.  	
              Service
                of Process.

            

    

     

    The
      Borrower hereby consents to process being served in any suit, action, or
      proceeding instituted in connection with this Note in the manner provided in
      the
      Financing Agreement.

     

    
      	20.  	
              No
                Novation.

            

    

     

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

     

    
      	21.  	
              WAIVER
                OF TRIAL BY JURY.

            

    

     

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

    
       

      
        
          5

        

        
          
          

          
          

        

        
          
          

        

      

    

     

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

     

     

    [Signatures
      follow on next page]

    
       

      
        
          6

        

        
          
          

          
          

        

        
          
          

        

      

    

     

    SIGNATURE
      PAGE TO

    AMENDED
      AND RESTATED REVOLVING CREDIT NOTE (M&T)

     

    
       

      
        	
                 WITNESS:

                 

                ______________________

              	
                PAYMENTS
                  INC.

                 

                By:____________________
                  (SEAL)

                Barry
                  B. Goldstein,

                President

              
	 	 
	
                WITNESS:

                 

                _______________________

              	
                DCAP
                  GROUP, INC.

                 

                By:_____________________
                  (SEAL)

                Barry
                  B. Goldstein,

                President

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