Document:

EMPLOYMENT AGREEMENT

 

BARNESANDNOBLE.COM LLC

76 Ninth Avenue

New York, New York 10011

As of October 31, 2002

Ms. Marie Toulantis

875 Fifth Avenue

New York, New York 10021

Dear Ms. Toulantis:

     This letter agreement is intended to set forth our mutual understanding
regarding your continued employment as Chief Executive Officer of
barnesandnoble.com llc and barnesandnoble.com inc. (collectively, the
“Company”). Accordingly, we are pleased to agree as follows:

     1.     Employment; Duties. You agree to continue to be Chief Executive
Officer of the Company for the term of this Agreement. In this capacity you
shall perform such duties and have such responsibilities as are typically
associated with the office of Chief Executive Officer, including such duties
and responsibilities as are prescribed by the Board of Directors of the Company
(the “Board”) consistent with the office of Chief Executive Officer. While you
are the Company’s employee, you agree to devote your full business time and
attention to the performance of your duties and responsibilities hereunder.

     2.     Term. (a) Unless terminated earlier in accordance with the provisions
set forth below, the term of this Agreement will be for a period beginning on
the date hereof and ending on the third anniversary of the date hereof. At the
expiration (but not earlier termination) of the term (including any renewal
term), the term of this Agreement shall automatically renew for an additional
period of one year, unless either party has given the other party written
notice of non-renewal at least six months prior to such renewal.

               (b) This Agreement shall terminate upon your death and may be terminated
by the Company by written notice to you following your Disability (as defined
below). This Agreement may also be terminated by the Company for Cause (as
defined below) upon written notice to you. This Agreement may also be
terminated by you for Good Cause (as defined below) upon written notice to the
Company.

               (c) For purposes of this Agreement:

		
	 	     (i) “Cause” shall mean (A) your final conviction of a felony
impacting on the performance of your duties or involving a crime of moral
turpitude, or (B) misappropriation or embezzlement in the performance of
your duties as an employee of the Company, or (C) willfully engaging in
conduct materially injurious to the Company and in violation of your
obligations under this Agreement, which violation

 

 

		
	 	continues for at least 30 days after written notice thereof from the
Company to you specifying such violation in reasonable detail.
	 
	 	     (ii) “Disability” shall mean a written determination by a physician
mutually agreeable to the Company and you (or, in the event of your total
physical or mental disability, your legal representative) that you are
physically or mentally unable to perform your duties of Chief Operating
Officer under this Agreement and that such disability can reasonably be
expected to continue for a period of six consecutive months or for
shorter periods aggregating 180 days in any 12-month period.

     3.     Compensation.

               3.1. Salary. The Company will pay you, for all services you perform
hereunder, an annual salary of $500,000, increasing to $600,000 on January 1,
2003, or such higher amount as the Compensation Committee of the Board (the
“Compensation Committee”) may determine, payable in accordance with the
Company’s payroll schedule applicable to executive officers of the Company.

               3.2. Bonus Compensation. In addition to your above-mentioned salary, we
will pay you, within 90 days following the end of each fiscal year of the
Company during the term of your employment, annual bonus compensation up to 65%
of your base salary in accordance with the Company’s annual bonus compensation
plan established by the Compensation Committee, which shall include certain
targets for you established by the Compensation Committee prior to each fiscal
year of the Company. In addition to that bonus, we will pay you, within 90
days following the end of each fiscal year of the Company during the term of
your employment, additional annual bonus compensation up to 35% of your base
salary based upon achievement of certain pre-set targets established prior to
each fiscal year by the Compensation Committee.

               3.3. Employee Benefits. During the term of your employment, you will
participate in and receive any benefits to which you are entitled under
employee benefit plans which the Company provides for all employees, as well as
all benefits which the Company provides, or may at any time in the future
provide, for its executive officers.

               3.4. Expenses; Car Allowance. During the term of your employment, we
will: (a) pay you a car allowance per month of $1,000, or such higher amount
as may be determined by the Compensation Committee; and (b) reimburse you for
all expenses incurred by you in the performance of your duties and
responsibilities under this Agreement, including, without limitation,
entertainment and travel expenses, in accordance with the policies and
procedures established by the Compensation Committee.

               3.5. Disability Insurance. In addition to the foregoing, we will obtain
in your name a disability insurance policy providing for monthly payments to
you of at least $12,500 during the period of any disability until the earlier
of your attaining age 65 or death. During the term of your employment, we will
pay all premiums due on such policies.

               3.6. Severance. In the event of the expiration or termination of the term
of your employment (other than for Cause, your death or Disability, or your
voluntary

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                termination of your employment, whether through resignation, non-renewal
or otherwise), we will pay you a lump sum, within 30 days following such
expiration or termination, equal to (a) the sum of (i) your then annual salary,
(ii) your annual bonus for the then most recently completed fiscal year of the
Company, and (iii) the then aggregate annual dollar amount of the payments made
or to be made by the Company for purposes of providing you with the benefits
set forth in paragraphs 3.3 through 3.5 above, multiplied by (b) the greater of
(i) two or (ii) the number of months remaining in the term of this Agreement
divided by 12. You shall be under no duty to mitigate damages and the amount
paid to you under this paragraph 3.6 shall not be diminished in any way by your
earnings or income from any other sources.

               3.7. Stock Options. Effective as of the date hereof, you shall be granted
“nonqualified” stock options to purchase 500,000 shares of common stock of the
Company at an exercise price of $1.15 per share. All options granted to you
under this Section 3.7 shall expire on the earlier of (a) the tenth anniversary
of the date hereof and (b) one year after the expiration or earlier termination
(other than for Cause) of the term of your employment, unless otherwise
extended by the Compensation Committee. Such options shall vest and be
exercisable in equal one-third increments on the first through third
anniversaries of the date hereof, respectively. Notwithstanding the foregoing,
all such options shall vest and be immediately exercisable in full upon a
Change of Control (as defined below) or upon the earlier expiration or
termination of this Agreement (unless such earlier termination is for Cause or
results from your voluntary termination of your employment).

               3.8. Change of Control Payments. (a) If at any time during the term of
this Agreement there is a Change of Control and (i) your employment is
terminated by the Company for any reason (other than for Cause) or (ii) you
voluntarily terminate your employment for Good Cause, in either case within the
greater of two years following the Change of Control or the remaining term of
this Agreement, the Company shall pay to you the following amount: (A) the sum
of (x) your then annual salary, (y) your then most recent annual bonus, and (z)
the then aggregate annual dollar amount of the payments made or to be made by
the Company for purposes of providing you with the benefits set forth in
paragraphs 3.3 through 3.6 above, multiplied by (B) the greater of (x) three or
(y) the number of months remaining in the term of this Agreement divided by 12;
provided that the maximum amount payable pursuant to this Section 3.8 shall be
the maximum amount payable to the Executive without triggering an excise tax
under Section 280G of the Internal Revenue Code of 1986, as amended, or any
successor provision thereto. The amount due under this Section 3.8 shall be
paid to you in one lump sum within 30 days after the date your employment
terminates. Subject to the Section 280G limitation referred to above, to the
extent that you are not fully vested in any retirement benefits from any
pension, profit-sharing or other retirement plan or program maintained by the
Company, the Company shall pay directly to you the difference between the
amounts which would have been paid to you had you been fully vested on the date
that your employment terminates and the amounts actually paid or payable to you
pursuant to such plans or programs. The amounts payable to you under this
Section 3.8 shall be in lieu of any amounts payable to you under Section 3.6
above.

               (b) As used herein, “Change of Control” shall mean the occurrence of one
or more of the following events:

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	 	     (i) after the date hereof, any person, entity or “group” as
identified in Sections 13(d)(3) or 14(d)(2) of the Securities Exchange
Act of 1934 (the “1934 Act”), including without limitation Barnes &
Noble, Inc. or Bertelsmann AG (but excluding any “group” consisting of
both of them, unless either of them separately becomes a beneficial owner
of more than 50%), other than you or any of your affiliates becomes a
beneficial owner (as such term is defined in Rule 13d-3 under the 1934
Act) directly or indirectly of securities representing more than 50% of
the total number of votes that may be cast for the election of Class A
Directors of the Company; or
	 
	 	     (ii) within two years after a merger, consolidation, liquidation or
sale of assets involving the Company, or a contested election of a
Company director, or any combination of the foregoing, the individuals
who were directors of the Company immediately prior thereto shall cease
to constitute a majority of the Board; or
	 
	 	     (iii) within two years after a tender offer or exchange offer for
voting securities of the Company, the individuals who were directors of
the Company immediately prior thereto shall cease to constitute a
majority of the Board.

               (c) As used herein, “Good Cause” shall mean the occurrence of one or more
of the following events within two years after a Change of Control:

		
	 	     (i) there shall have been a material modification of your duties,
title or direct reports;
	 
	 	     (ii) there shall have been a material reduction in the compensation
and benefits you receive from the Company; or
	 
	 	     (iii) the principal executive offices of the Company shall be
relocated to a location outside of the New York City metropolitan area.

     4.     Non-Competition.

               4.1. Covenant. You agree that so long as you are employed by the Company
and for a period of two years thereafter, you will not directly or indirectly,
either as principal, agent, stockholder, employee or in any other capacity,
engage in or have a financial interest in any business that is competitive with
the businesses operated by the Company or any of its subsidiaries. The
foregoing provision shall cease to apply after: (i) you voluntary terminate
your employment for Good Cause within two years following a Change of Control;
or (ii) your employment terminates involuntarily, other than for Cause prior to
a Change of Control.

               4.2. Ownership of Other Securities. Nothing in paragraph 4.1 shall be
construed as denying you the right to own securities of any corporation listed
on a national securities exchange or quoted in the NASDAQ System to the extent
of an aggregate of 5% of the outstanding shares of such securities.

               4.3. Reasonableness. You acknowledge that the foregoing limitations are
reasonable and properly required by the Company and that in the event that any
such

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                limitations are found to be unreasonable by a court of competent
jurisdiction, you will submit to the reduction of such limitations as the court
shall find reasonable.

               4.4. Severability. If any of the restrictions in paragraph 4.1 should for
any reason whatsoever be declared invalid by a court of competent jurisdiction,
the validity or enforceability of the remainder of this Agreement will not be
adversely affected thereby.

               4.5. Equitable Relief. You acknowledge that your services to the Company
are of a unique character which give them a special value to the Company. You
further recognize that any violation of the restrictions in paragraph 4.1 may
give rise to losses or damages for which the Company cannot be reasonably or
adequately compensated in an action at law and that such violation may result
in irreparable and continuing harm to the Company. Accordingly, you agree
that, in addition to any other remedy which the Company may have at law or in
equity, the Company shall be entitled to injunctive relief to restrain any
violation by you of the restrictions in paragraph 4.1.

     5.     Indemnification. You shall be indemnified by the Company, as an
officer and director of the Company and its affiliates, against all actions,
suits, claims, legal proceedings and the like to the fullest extent permitted
by law, including advancement of expenses, partial indemnification,
indemnification following the termination of this Agreement, indemnification of
your estate and similar matters.

     6.     Miscellaneous.

               6.1. Entire Agreement. This Agreement constitutes the entire agreement
between you and the Company with respect to the terms and conditions of your
employment by the Company and supersedes all prior agreements, understandings
and arrangements, oral or written, between you and the Company with respect to
the subject matter hereof.

               6.2. Binding Effect; Benefits. This Agreement shall inure to the benefit
of and shall be binding upon you and the Company and our respective heirs,
legal representatives, successors and assigns.

               6.3. Amendments and Waivers. This Agreement may not be amended or
modified except by an instrument or instruments in writing signed by the party
against whom enforcement of any such modification or amendment is sought.
Either party may, by an instrument in writing, waive compliance by the other
party with any term or provision of this Agreement to be performed or complied
with by such other party.

               6.4. Assignment. Neither this Agreement nor any rights or obligations
which either party may have by reason of this Agreement shall be assignable by
either party without the prior written consent of the other party.

               6.5. Litigation Expenses. The Company will pay any actual expenses for
reasonable attorneys’ fees and disbursements incurred by you, or your personal
representative, in seeking to obtain or enforce any right or benefit under this
Agreement, if you or your representative is the prevailing party.

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               6.6. No Mitigation. In the event of termination of this Agreement by you
as a result of the breach by the Company of any of its obligations hereunder,
or in the event of the termination of your employment by the Company in breach
of this Agreement, you shall not be required to seek other employment in order
to mitigate damages hereunder.

               6.7. Notices. Any notice which may or must be given under this Agreement
shall be in writing and shall be personally delivered or sent by certified or
registered mail, postage prepaid, or reputable overnight courier, addressed to
you or the Company, as the case may be, at the address set forth on the first
page hereof, or to such other address as you or the Company, as the case may
be, may designate in writing in accordance with the provisions of this
paragraph.

               6.8. Section and Other Headings. The section and other headings contained
in this Agreement are for reference purposes only and are not deemed to be a
part of this Agreement or to affect the meaning and interpretation of this
Agreement.

               6.9. Governing Law. This Agreement shall be construed (both as to
validity and performance) and enforced in accordance with and governed by the
laws of the State of New York applicable to agreements made and to be performed
wholly within the State of New York.

               6.10. Survival of Rights and Obligations. All rights and obligations of
you and the Company arising during the term of this Agreement shall continue to
have full force and effect after the termination of this Agreement unless
otherwise provided herein.

               6.11. Counterparts. This Agreement may be signed in counterparts, which
together shall constitute one and the same agreement.

     If the foregoing accurately reflects our agreement, kindly sign and return
to us the enclosed duplicate copy of this letter.

	 	 	 	 	 
	 	 	Very truly yours,
	 	 	
BARNESANDNOBLE.COM LLC

By: barnesandnoble.com inc., its sole manager	 	 
	 	 	 	 	 
	 	 	
By: /s/ LEONARD RIGGIO	 	 
	 	 	

	 	 
	 	 	
Name: Leonard Riggio	 	 
	 	 	
Title: Chairman	 	 

	 	 	 	 	 
	ACCEPTED AND AGREED TO:
	 
	/s/ MARIE J. TOULANTIS

Marie J. Toulantis

6<PAGE>

                                                                   EXHIBIT 10.21

                               FIRST AMENDMENT TO
                       SECOND SECURED TERM LOAN AGREEMENT

                  FIRST AMENDMENT TO SECOND SECURED TERM LOAN AGREEMENT (the
"First Amendment"), dated as of February 14, 2003, by and between MSX
INTERNATIONAL, INC., a Delaware corporation (the "Company") and COURT SQUARE
CAPITAL LIMITED, a Delaware corporation (the "Lender").

                                    RECITALS

                  A. The Company, each of the borrowing subsidiaries of the
Company party thereto from time to time, the lenders party thereto from time to
time (the "Senior Lenders"), and Bank One, NA, a national banking association,
as agent for the Senior Lenders (the "Agent"), are parties to an Amended and
Restated Credit Agreement dated as of November 30, 1999, as amended from time to
time (the "Senior Credit Agreement").

                  B. The Company and the Lender are parties to a Second Secured
Term Loan Agreement dated as of July 31, 2002 (the "Term Loan Agreement"), under
which the Lender made a loan to the Company in the amount of $15,450,000.

                  C. The Company has requested that the Lender provide for an
additional loan to be made by the Lender to the Company in an amount of up to
$10,769,105.90, to cure certain defaults (if any) by the Company under the
Senior Credit Agreement, as specified in the Funding Agreement, and the Lender
is willing to agree to lend such amount on the terms and conditions of this
First Amendment.

                  D. The Lender has determined that the execution and
performance of this First Amendment in its interest and to its financial
benefit.

                  In consideration of the premises and the agreements,
provisions and covenants herein contained, the Company and the Lender agree as
follows:

                  1. Definitions. Unless otherwise defined herein, all
capitalized terms used herein shall have the meanings assigned to such terms in
the Term Loan Agreement. Each reference to "hereof", "hereunder", "herein" and
"hereby" and each other similar reference and each reference to "this Agreement"
and each other similar reference contained in the Term Loan Agreement shall from
and after the date hereof refer to the Term Loan Agreement as amended hereby.

                  2. Amendments to Term Loan Agreement. The Term Loan Agreement
is hereby amended as follows:

                           (a) Section 1.1 of the Term Loan Agreement is amended
to restate the following definitions:

<PAGE>

                  "Loan" means any loans made by the Lender to the Company
pursuant to Section 2.1 hereof, including the Loan-First Tranche and the
Loan-Second Tranche.

                  "Loan Documents" means this Agreement, the Funding Agreement,
the Note-First Tranche, the Note-Second Tranche, the Security Documents and any
other agreement, instrument or document executed in connection with any of the
foregoing at any time, each as amended, supplemented or modified from time to
time.

                  "Note" means one or more of the notes of the Company issued
pursuant to the terms and conditions of Sections 2.1, 2.2(b)(ii) or 8.1 hereof,
including without limitation the Note-First Tranche and the Note-Second Tranche.

                           (b) Section 1.1 of the Term Loan Agreement is further
amended to add the following definitions in alphabetical order:

                  "Citicorp Support" means the Guarantee, dated as of February
14, 2003, by Citicorp in favor of the Senior Lenders and the Agent, pursuant to
which Citicorp guarantees the payment of the obligations of the Lender under the
Funding Agreement.

                  "Debt Financing" means each requirement that a Loan-Second
Tranche be made by the Lender to the Company pursuant to Section 2(a), (b) or
(c) of the Funding Agreement, whether funded by the Lender or pursuant to
Citicorp Support.

                  "Debt Financing Date" means the date any Debt Financing is
required to be made pursuant to the Funding Agreement.

                  "First Amendment" means the First Amendment to this Agreement,
dated February 14, 2003.

                  "First Amendment Effective Date" means the date on which all
conditions precedent to the First Amendment are satisfied.

                  "Funding Agreement" means the Funding Agreement, dated as of
February 14, 2003 by the Lender, in favor of the Senior Lenders and the Agent.

                  "Loan-First Tranche" means the term loan in the aggregate
principal amount of $15,450,000 made by the Lender to the Company as of the
Effective Date.

                  "Loan-Second Tranche" means any term loan or loans (other than
the Loan-First Tranche) in an aggregate principal amount of up to $10,769,105.90
made by the Lender to the Company at any time pursuant to this Agreement, as
required by the Funding Agreement.

                  "Note-First Tranche" means one or more notes of the Company
issued pursuant to Section 2.1(a) hereof, substantially in the form of Exhibit C
hereto.

                                      -2-
<PAGE>

                  "Note-Second Tranche" means one or more notes of the Company
issued pursuant to Section 2.1(b) hereof, substantially in the form of Exhibit C
hereto.

                  "Second Maturity Date" means the first day following the
Maturity Date on which aggregate payments in excess of $10,000,000 under this
Agreement would not, after giving effect to the payments made on such date, be
made to the Lender in any one year.

                  "Senior Lenders" means the lenders party to the Senior Credit
Agreement from time to time.

                           (c) Section 2.1 of the Term Loan Agreement is amended
and restated in its entirety to read as follows:

                  (a)      Loan-First Tranche and Note-First Tranche.

                           (i) Loan-First Tranche. Subject to the terms and
                  conditions of this Agreement and in reliance upon the
                  representations and warranties of the Company herein set
                  forth, the Lender hereby agrees to lend to the Company on the
                  Effective Date, an amount equal to $15,450,000.

                           (ii) Payment of Loan-First Tranche. The unpaid
                  principal amount of the Loan-First Tranche plus all accrued
                  and unpaid interest thereon and all other amounts owed
                  hereunder with respect thereto shall be paid in full in Cash
                  on the Maturity Date.

                           (iii) Note-First Tranche. On the Effective Date, the
                  Company shall execute and deliver to the Lender the Note-First
                  Tranche dated as of the Effective Date, to evidence the
                  Loan-First Tranche made on such date, in the aggregate
                  principal amount of $15,450,000.

                  (b)      Loan-Second Tranche and Note-Second Tranche.

                           (i) Loan-Second Tranche. Subject to the terms and
                  conditions of this Agreement and in reliance upon the
                  representations and warranties of the Company herein set
                  forth, the Lender hereby agrees to lend to the Company on any
                  Debt Financing Date, an amount equal to the Debt Financing
                  required on such date pursuant to the Funding Agreement, such
                  amount not to exceed $10,769,105.90 in the aggregate and not
                  to exceed $10,000,000 in any one year.

                           (ii) Payment of Loan-Second Tranche. The unpaid
                  principal amount of the Loan-Second Tranche plus all accrued
                  and

                                      -3-
<PAGE>

                  unpaid interest thereon and all other amounts owed hereunder
                  with respect thereto shall be paid in full in Cash as follows:
                  (A) up to $10,000,000 payable to Lender plus all other amounts
                  owed hereunder to any other Person on the Maturity Date and
                  (B) any amount in excess of $10,000,000 payable to Lender plus
                  all other amounts owed hereunder to any other Person on the
                  Second Maturity Date; provided, however, upon the receipt of a
                  fairness opinion as provided in Section 5.10 hereof, the full
                  unpaid principal amount of the Loan-Second Tranche plus all
                  accrued and unpaid interest thereon and all other amounts owed
                  hereunder with respect thereto shall be paid in full in Cash
                  on the Maturity Date. Notwithstanding the foregoing, upon
                  receipt of notice from Citicorp to the Company that payment to
                  the Company pursuant to the Citicorp Support has been required
                  to be made, Citicorp shall become the "Lender" in respect of
                  the Loan-Second Tranche for which Citicorp has made payment
                  under the Citicorp Support for all purposes of this Agreement
                  and the Company shall be obligated to pay the Loan-Second
                  Tranche to Citicorp in accordance with the provisions set
                  forth herein.

                           (iii) Note-Second Tranche. On the First Amendment
                  Effective Date, the Company shall execute and deliver to the
                  Lender a Note-Second Tranche dated as of the First Amendment
                  Effective Date, to evidence the Loan-Second Tranche in an
                  aggregate principal amount of up to $10,769,105.90.

                           (d) Section 2.4(a) of the Term Loan Agreement is
amended and restated in its entirety to read as follows:

                  Use.  Proceeds of the Loan shall be used as follows:

                  (i) The proceeds of the Loan-First Tranche made on the
                  Effective Date shall be used by the Company to partially repay
                  the Term Loans (as defined in the Senior Credit Agreement), to
                  pay fees and expenses in connection herewith and for general
                  corporate purposes.

                  (ii) The proceeds of the Loan-Second Tranche made on any Debt
                  Financing Date shall be used by the Company to repay the Term
                  Loans (as defined in the Senior Credit Agreement) pursuant to
                  Section 3.1(l) of the Senior Credit Agreement.

                           (e) Section 2.5 of the Term Loan Agreement is amended
and restated in its entirety to read as follows:

                                      -4-
<PAGE>

                  Fees. On the Effective Date, the Company shall pay to the
                  Lender a nonrefundable closing fee in the amount of $450,000,
                  which amount has been added to the principal balance of the
                  Loan-First Tranche. Such closing fee shall be nonrefundable
                  under all circumstances.

                           (f) The following new Section 5.10 is added:

                  SECTION 5.10. Fairness Opinion. The Company shall use its best
                  efforts to obtain, at the request of Lender and at the
                  Company's own expense, an opinion of a nationally recognized
                  investment banking firm that the Loan-Second Tranche is fair,
                  from a financial standpoint, to the Company and its Restricted
                  Subsidiaries, after taking into account the effect of the
                  receipt of such fairness opinion upon the terms of the
                  Loan-Second Tranche as provided in Section 2.1(b)(ii) and
                  Article VII hereof.

                           (g) Article VII is amended by adding the following
new sentence at the end of the first full paragraph following Section 7.9
thereof:

                  Notwithstanding the foregoing, no payment to Lender under or
                  in respect of the Loan-Second Tranche shall be required to be
                  made in excess of $10,000,000 in any one year until such time
                  as the Company receives a fairness opinion as provided in
                  Section 5.10 hereof.

                           (h) Section 8.2 of the Term Loan Agreement is amended
and restated in its entirety to read as follows:

                  Expenses. Whether or not the transactions contemplated hereby
                  shall be consummated, the Company agrees to pay promptly, or
                  reimburse the Lender, as the case may be, for the payment of,
                  on demand, (i) all the actual and reasonable costs and
                  expenses of preparation of the Loan Documents and the Senior
                  Debt Documents and all the costs of furnishing all opinions by
                  counsel for the Company (including, without limitation, any
                  opinions requested by the Lender as to any legal matters
                  arising hereunder or thereunder), and of the Company's
                  performance of and compliance with all agreements and
                  conditions contained herein on its part to be performed or
                  complied with (including all stamp and other taxes and fees
                  payable or determined to be payable in connection with the
                  execution, delivery, filing or recording of the Loan Documents
                  and the Senior Debt Documents and the consummation of the
                  transactions contemplated hereby and thereby, and any and all
                  liabilities with respect to or resulting from any delay in
                  paying or omitting to pay such taxes or fees); (ii) the
                  reasonable fees, expenses, and disbursements of counsel to the

                                      -5-
<PAGE>

                  Lender in connection with the negotiation, preparation,
                  execution, and administration of the Loan Documents, the
                  Senior Debt Documents and the Loan hereunder, and any
                  amendments and waivers hereto or thereto (other than
                  assignments of, or sales of participants in, the Notes
                  pursuant to Section 8.1) and (iii) after the occurrence of an
                  Event of Default, all costs and expenses (including reasonable
                  attorneys' fees) incurred by the Lender in enforcing any
                  Obligations of or in collecting any payments due from the
                  Company hereunder or under the Note by reason of such Event of
                  Default or in connection with any refinancing or restructuring
                  of the credit arrangements provided under this Agreement in
                  the nature of a workout, or any insolvency or bankruptcy
                  proceedings.

                           (i) Section 8.6 of the Term Loan Agreement is amended
by replacing each reference to "Dechert" with "Dechert LLP".

                  3. Reaffirmation.

                           (a) Each of the Company and the Lender hereby
ratifies, affirms and reaffirms in all respects its obligations and undertakings
under each Loan Document (including without limitation, the Security Documents)
to which it is a party, including without limitation, all terms, conditions,
representations and covenants in each of the Loan Documents (as applicable) and
agrees that all references therein to the Loan Agreement shall be deemed to
refer to the Loan Agreement as amended by this First Amendment and shall include
the Loan-Second Tranche and the Note-Second Tranche.

                           (b) Each of the Company and the Lender hereby
acknowledges (i) the continued existence, validity and enforceability of each
Loan Document (including without limitation, the Security Documents) to which it
is a party, and agrees that the terms and conditions, representations and
covenants of each such Loan Document are binding upon it and (ii) subsequent to,
and after taking into account of all the terms and conditions of this First
Amendment, each Loan Document (including without limitation, the Security
Documents) is and shall remain in full force and effect in accordance with the
terms thereof.

                  4. Representations and Warranties; No Default.

                           (a) The execution, delivery and performance of this
First Amendment are within its powers, have been duly authorized and are not in
contravention of any statute, law or regulation or of any term of its Articles
of Incorporation, By-laws or other organizational documents, or of any material
agreement or undertaking to which it is a party or to which it is bound.

                           (b) This First Amendment is the legal, valid and
binding obligation of the Company and the Lender, enforceable against each in
accordance with the terms hereof,

                                      -6-
<PAGE>

subject to the effect of bankruptcy, insolvency, reorganization, moratorium and
other similar laws affecting the rights of creditors generally and by general
principles of equity.

                           (c) On and as of the date hereof, after giving effect
to this First Amendment, the representations and warranties of the Company
contained in the Term Loan Agreement are true and correct, except to the extent
that any such representations and warranties expressly related to an earlier
date, in which case such representations and warranties shall have been true and
correct as of such earlier date.

                           (d) On and as of the date hereof, after giving effect
to this First Amendment, no Event of Default or Unmatured Event exists under the
Term Loan Agreement.

                           (e) Schedule 1 attached hereto is a complete and
accurate list of all Subsidiaries of the Company, including an accurate
description of the jurisdiction and organization and ownership thereof.

                           (f) Neither the Company nor any of its Subsidiaries
owns any real property.

                  5. Conditions. This First Amendment shall become effective as
of the date upon which the following conditions are satisfied (the "First
Amendment Effective Date"):

                           (a) The Company and the Lender shall have duly
executed this First Amendment;

                           (b) The Company shall have duly executed and
delivered to the Lender the Note-Second Tranche, substantially in the form of
Exhibit C to the Term Loan Agreement;

                           (c) The Guarantors shall have duly executed the
Consent to Amendment and Reaffirmation of Loan Documents (the "Consent and
Reaffirmation"), substantially in the form of Exhibit A attached hereto;

                           (d) The Third Amendment to Amended and Restated
Credit Agreement shall have been duly executed by the parties thereto and shall
be in full force and effect;

                           (e) The Funding Agreement shall have been duly
executed by the parties thereto and shall be in full force and effect;

                           (f) The Company and each Guarantor shall have
provided a certified resolution with respect to this First Amendment or the
Consent and Reaffirmation (as applicable) satisfactory to the Lender;

                                      -7-
<PAGE>

                           (g) The Company and the Guarantors shall have
provided the written opinion of the Company's and the Guarantors' counsel in
form and substance acceptable to the Lender;

                           (h) The Lender shall have received payment in full
for all fees and expenses (including reasonable attorneys' fees) owing to the
Lender; and

                           (i) The Company and the Guarantors shall have
delivered to the Lender such other documents and satisfied such other conditions
as reasonably requested by the Lender, including without limitation any
additional Security Documents required by the Lender.

                  6. Miscellaneous.

                           (a) Continued Effectiveness. Except as specifically
amended herein, all other terms and provisions of the Term Loan Agreement shall
remain unchanged and in full force and effect.

                           (b) No Claims. The Company represents and warrants
that it is not aware of any claims or causes of action against the Lender or any
of its successors or assigns arising from or in any way related to the First
Amendment, the Term Loan Agreement or any of the other Loan Documents.
Notwithstanding this representation and as further consideration for the
agreements and understandings herein, the Company, on behalf of itself and its
employees, agents, executors, heirs, successors and assigns, hereby releases the
Lender, its predecessors, officers, directors, employees, agents, attorneys,
affiliates, subsidiaries, successors and assigns, form any liability, claim,
right or cause of action which now exists or hereafter arises as a result of
acts, omissions or events occurring on or prior to the date hereof, whether
known or unknown, arising from or in any way related to this First Amendment,
the Term Loan Agreement or any of the other Loan Documents.

                           (c) Notices. Any notice required or permitted
pursuant to this First Amendment shall be delivered in accordance with the
provisions of Section 8.6 of the Term Loan Agreement.

                           (d) APPLICABLE LAW. THIS FIRST AMENDMENT SHALL BE
GOVERNED BY AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH LAWS OF THE
STATE OF NEW YORK WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS.

                           (e) Headings. Section and subsection headings in this
First Amendment are included herein for convenience of reference only and shall
not constitute a part of this First Amendment for any other purpose or be given
any substantive effect.

                           (f) Severability. If any term, provision or covenant
of this First Amendment is held by a court of competent jurisdiction to be
invalid, void or unenforceable, the remainder of the terms, provisions and
covenants of this Agreement shall remain in full force and effect and shall in
no way be affected, impaired or invalidated.

                                      -8-
<PAGE>

                           (g) Amendment and Waiver. No amendment of any
provision of this First Amendment shall be effective, unless the same shall be
undertaken and consummated in accordance with the terms of Section 8.4 of the
Term Loan Agreement.

                           (h) Counterparts. This First Amendment and any
amendments, waivers, consents or supplements may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument. This
First Amendment shall become effective upon the execution of a counterpart
hereof by each of the parties hereto, and written or verbal notification of such
execution and authorization of delivery thereof has been received by each of the
Company and the Lender.

                           (i) Entirety. The Term Loan Agreement and the other
Loan Documents, as amended by this First Amendment, constitute the entire
understanding among the parties and supersede all prior agreements and
understandings, if any, relating to the subject matter hereof and thereof.

                                      -9-
<PAGE>

                  IN WITNESS WHEREOF the due execution hereof by the respective
duly authorized officers of the undersigned as of the date first written above.

                                  MSX INTERNATIONAL, INC.

                                  By:     /s/ David A. Crittenden
                                         -------------------------------------
                                         Name:   David A. Crittenden
                                         Title:  Assistant Treasurer

                                  COURT SQUARE CAPITAL LIMITED

                                  By:     /s/ Charles E. Corpening
                                         -------------------------------------
                                         Name:   Charles E. Corpening
                                         Title:  Vice President

                                      -10-

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