Document:

Exhibit 10.2

 

AERIN LLC

595 Madison Avenue

New York N.Y. 10022

 

February 22, 2019

 

Jane Hertzmark Hudis

Group President

The Estee Lauder Companies

767 Fifth Avenue

New York, New York 10153

 

RE: Second Amendment to the License Agreement

 

Dear Jane:

 

Reference is made to the License Agreement, dated as of April 6, 2011 among Aerin LLC (“Aerin”), Aerin Lauder Zinterhofer (“ALZ”) and Estee Lauder Inc. (“Estee Lauder”) (the “License Agreement”).

 

The parties desire that Estee Lauder enter into a sublicense with Hunter Amenities International Ltd. (“Hunter”) to grant Hunter the right to use the licensed intellectual property solely in connection with the manufacture, sale and distribution of certain amenity-size Licensed Products to hotels, resorts and airlines (the “Amenities Program”).

 

In consideration of the mutual covenants herein expressed, and for other good consideration, which Aerin, ALZ and Estee Lauder hereby acknowledge, the parties hereby agree to amend the license as follows, effective as of February 22, 2019:

 

1.              Section 2.2 of the License Agreement is hereby amended to read as follows:

 

Sublicense.  No right for EL to sublicense is granted with respect to the Licensed Trademarks, ALZ Identifiers and Ancillary IP for the manufacture of Licensed Products, except that: (a) EL may authorize an Affiliate of EL and/or a third party to use the Licensed Trademarks, ALZ Identifiers and Ancillary IP in the manufacture of Licensed Products on behalf of and solely for sale to EL and/or its Affiliates; and (b) EL may enter into a sublicense agreement with Hunter authorizing use of the Licensed Trademarks, ALZ Identifiers and Ancillary IP solely in the manufacture, sale and distribution of Licensed Products in the Territory and during the Term solely in in connection with the Amenities Program (the “Hunter Sublicense”).  The foregoing consent to enter into the Hunter Sublicense is expressly subject to the following conditions, which Estee Lauder represents, warrants and covenants are, and will continue at all times to be, satisfied by the Hunter Sublicense:

 

(i)            such sublicense shall provide, among other provisions, that: (A) it is expressly subject and subordinate to (and coterminous with) the License

 

 

Agreement; and (B) except as provided below with respect to channels of distribution, Hunter is bound by all of the terms and conditions of the License Agreement to the extent they relate to the rights sublicensed to Hunter (including, without limitation, Aerin’s approval rights with respect to the Licensed Products, Packaging and A&P Materials, etc.);

 

(ii)           Licensed Products under the Amenities Program may be distributed in the channels of distribution set forth in the Hunter Sublicense, provided that each resort chain and/or airline in which Licensed Products are to be distributed shall be approved by Aerin in advance;

 

(iii)          Aerin shall be entitled to purchase Licensed Products produced under the Hunter Sublicense directly from Hunter on the same terms and conditions as Estee Lauder is entitled to purchase any such Licensed Products from Hunter;

 

(iv)          such sublicense will not relieve Estee Lauder of any of its obligations or liabilities under the License Agreement and Estee Lauder will be primarily and fully liable to Aerin and ALZ for the performance of Hunter (including, without limitation, for indemnification claims) and observance by Hunter of all of the terms and conditions of the License Agreement sublicensed under the Hunter Sublicense; and

 

(v)           any material modifications or amendments of the Hunter Sublicense (including any extension thereof or any change to the territory, licensed products, distribution channels, approval rights or economic terms) shall be subject to the prior written approval of Aerin.

 

2.              A new Section 9.1 (a) (iii) is added to the License Agreement as follows:

 

Amenities Royalties.  For each Annual Period to the extent that EL receives advances, guarantees, royalty or other payments from Hunter in connection with the Amenities Program (“Amenities Royalties”), fifty percent (50%) of such Amenities Royalties shall be included in the Royalty Amount and shall be payable to Aerin in accordance with section 9.1(b) of the License Agreement and shall be included in the Royalty Statements in accordance with Section 9.2 of the License Agreement.  The parties agree that, at the end of the first full Annual Period in which the Amenities Program generates Amenities Royalties, the percentage of the Amenities Royalties to thereafter be included in the Royalty Amount shall be reviewed by the Parties; provided, however, that any change to such percentage shall require the written agreement of both Aerin and Estee Lauder.

 

-Intentionally Left Blank-

 

 

All capitalized terms used herein and not otherwise defined shall have the same meaning given  them in the License Agreement.  Unless otherwise modified by amendment, the License Agreement remains unchanged and fully in force.

 

	
 
    	
AERIN   LLC
    
	
 
    	
 
    
	
 
    	
By:   
    	
/s/Aerin   Lauder Zinterhofer
    
	
 
    	
Name:   
    	
Aerin   Lauder Zinterhofer
    
	
 
    	
Title:   
    	
Managing   Member
    
	
 
    	
 
    
	
 
    	
AERIN   LAUDER ZINTERHOFER
    
	
 
    	
 
    
	
 
    	
/s/Aerin   Lauder Zinterhofer
    
	
 
    	
 
    
	
Acknowledged   and agreed:
    	
 
    
	
 
    	
 
    
	
ESTEE   LAUDER INC.
    	
 
    
	
D.B.A.   AERIN BEAUTY
    	
 
    
	
 
    	
 
    
	
By:   
    	
/s/Jane   Hertzmark Hudis
    	
 
    	
 
    
	
Name:   
    	
Jane   Hertzmark Hudis
    	
 
    
	
Title:   
    	
Group   President, The Estee Lauder
    	
 
    
	
 
    	
Companiesexhibit 10.1

 

 

Exhibit 10.1

 

EXECUTION VERSION

 

 

 

 

 

 

REVOLVING CREDIT

AND

SECURITY AGREEMENT

 

PNC BANK, NATIONAL ASSOCIATION

 

(AS AGENT)

 

THE LENDERS PARTY HERETO

(AS LENDERS)

 

WITH

 

AUTOWEB, INC.

AND EACH PERSON JOINED HERETO AS

A BORROWER FROM
TIME TO TIME

(AS BORROWERS)

 

AND

 

CAR.COM, INC.

AUTOBYTEL, INC.

AW GUA USA, INC.

AND EACH PERSON JOINED HERETO AS

A GUARANTOR FROM
TIME TO TIME

(AS GUARANTORS)

 

 

 

 

APRIL 30, 2019

 

 

 

 

 

TABLE OF CONTENTS

 

	
 

	
 

	

Page

	

I.

	

DEFINITIONS

	

1

	

1.1.

	

Accounting Terms

	

1

	

1.2.

	

General Terms

	

1

	

1.3.

	

Uniform Commercial Code Terms

	

29

	

1.4.

	

Certain Matters of Construction

	

30

	

II.

	

ADVANCES, PAYMENTS

	

30

	

2.1.

	

Revolving Advances

	

30

	

2.2.

	

Procedures for Requesting Revolving Advances; Procedures for
Selection of Applicable Interest Rates for All
Advances

	

31

	

2.3.

	

Reserved

	

33

	

2.4.

	

Swing Loans

	

33

	

2.5.

	

Disbursement of Advance Proceeds

	

34

	

2.6.

	

Making and Settlement of Advances

	

34

	

2.7.

	

Maximum Advances

	

36

	

2.8.

	

Manner and Repayment of Advances

	

36

	

2.9.

	

Repayment of Excess Advances

	

36

	

2.10.

	

Statement of Account

	

36

	

2.11.

	

Letters of Credit

	

37

	

2.12.

	

Issuance of Letters of Credit

	

37

	

2.13.

	

Requirements For Issuance of Letters of Credit

	

38

	

2.14.

	

Disbursements, Reimbursement

	

38

	

2.15.

	

Repayment of Participation Advances

	

39

	

2.16.

	

Documentation

	

39

	

2.17.

	

Determination to Honor Drawing Request

	

39

	

2.18.

	

Nature of Participation and Reimbursement Obligations

	

40

	

2.19.

	

Liability for Acts and Omissions

	

41

	

2.20.

	

Mandatory Prepayments

	

42

	

2.21.

	

Use of Proceeds

	

42

	

2.22.

	

Defaulting Lender

	

43

	

2.23.

	

Payment of Obligations

	

45

	

III.

	

INTEREST AND FEES

	

45

	

3.1.

	

Interest

	

45

	

3.2.

	

Letter of Credit Fees

	

46

	

3.3.

	

Fee Letter and Facility Fee

	

47

	

3.4.

	

Reserved

	

47

	

3.5.

	

Computation of Interest and Fees

	

47

	

3.6.

	

Maximum Charges

	

47

	

3.7.

	

Increased Costs

	

47

	

3.8.

	

Alternative Rate of Interest

	

48

	

3.9.

	

Capital Adequacy

	

50

	

3.10.

	

Taxes

	

50

	

3.11.

	

Replacement of Lenders

	

54

	

3.12.

	

Mitigation Obligations

	

54

 

 

 

-i-

 

 

	

IV.

	

COLLATERAL: GENERAL TERMS

	

54

	

4.1.

	

Security Interest in the Collateral

	

54

	

4.2.

	

Perfection of Security Interest

	

55

	

4.3.

	

Preservation of Collateral

	

55

	

4.4.

	

Ownership and Location of Collateral

	

55

	

4.5.

	

Defense of Agent’s and Lenders’ Interests

	

56

	

4.6.

	

Inspection of Premises

	

56

	

4.7.

	

Reserved

	

56

	

4.8.

	

Receivables; Deposit Accounts and Securities Accounts

	

56

	

4.9.

	

Reserved

	

58

	

4.10.

	

Maintenance of Equipment

	

58

	

4.11.

	

Exculpation of Liability

	

59

	

4.12.

	

Financing Statements

	

59

	

4.13.

	

Investment Property Collateral

	

59

	

V.

	

REPRESENTATIONS AND WARRANTIES

	

60

	

5.1.

	

Authority

	

60

	

5.2.

	

Formation and Qualification

	

60

	

5.3.

	

Survival of Representations and Warranties

	

60

	

5.4.

	

Tax Returns

	

61

	

5.5.

	

Financial Statements

	

61

	

5.6.

	

Entity Names

	

61

	

5.7.

	

O.S.H.A. Environmental Compliance; Flood Insurance

	

62

	

5.8.

	

Solvency; No Litigation, Violation, Indebtedness or Default; ERISA
Compliance

	

62

	

5.9.

	

Intellectual Property

	

63

	

5.10.

	

Licenses and Permits

	

64

	

5.11.

	

Reserved

	

64

	

5.12.

	

No Default

	

64

	

5.13.

	

No Burdensome Restrictions

	

64

	

5.14.

	

No Labor Disputes

	

64

	

5.15.

	

Margin Regulations

	

64

	

5.16.

	

Investment Company Act

	

64

	

5.17.

	

Swaps

	

64

	

5.18.

	

Business and Property of the Loan Parties

	

64

	

5.19.

	

Ineligible Securities

	

64

	

5.20.

	

Federal Securities Laws

	

64

	

5.21.

	

Equity Interests

	

65

	

5.22.

	

Commercial Tort Claims

	

65

	

5.23.

	

Letter of Credit Rights

	

65

	

5.24.

	

Material Contracts

	

65

	

5.26

	

Disclosure

	

65

 

 

-ii-

 

 

	

VI.

	

AFFIRMATIVE COVENANTS

	

62

	

6.1.

	

Compliance with Laws

	

62

	

6.2.

	

Conduct of Business and Maintenance of Existence and
Assets

	

62

	

6.3.

	

Books and Records

	

66

	

6.4.

	

Payment of Taxes

	

66

	

6.5.

	

Financial Covenants

	

66

	

6.6.

	

Insurance

	

67

	

6.7.

	

Payment of Indebtedness and Leasehold Obligations

	

67

	

6.8.

	

Environmental Matters

	

68

	

6.9.

	

Standards of Financial Statements

	

68

	

6.10.

	

Federal Securities Laws

	

68

	

6.11.

	

Execution of Supplemental Instruments

	

68

	

6.12.

	

Pledged Cash

	

68

	

6.13.

	

Guatemalan Subsidiary Cash Restrictions

	

68

	

6.14.

	

Keepwell

	

68

	

6.15.

	

Deposit Accounts

	

69

	

6.16.

	

Post-Closing Covenants

	

69

	

VII.

	

NEGATIVE COVENANTS

	

69

	

7.1.

	

Merger, Consolidation, Acquisition and Sale of Assets

	

69

	

7.2.

	

Creation of Liens

	

70

	

7.3.

	

Guarantees

	

70

	

7.4.

	

Investments

	

70

	

7.5.

	

Loans

	

70

	

7.6.

	

Capital Expenditures

	

70

	

7.7.

	

Dividends and Distributions

	

70

	

7.8.

	

Indebtedness

	

70

	

7.9.

	

Nature of Business

	

70

	

7.10.

	

Transactions with Affiliates

	

70

	

7.11.

	

Leases

	

70

	

7.12.

	

Subsidiaries

	

71

	

7.13.

	

Fiscal Year and Accounting Changes

	

71

	

7.14.

	

Pledge of Credit

	

71

	

7.15.

	

Amendment of Organizational Documents

	

71

	

7.16.

	

Compliance with ERISA

	

71

	

7.17.

	

Prepayment of Indebtedness

	

72

	

7.18.

	

Division

	

72

	

7.19.

	

Locations

	

72

	

VIII.

	

CONDITIONS PRECEDENT

	

72

	

8.1.

	

Conditions to Initial Advances

	

72

	

8.2.

	

Conditions to Each Advance

	

74

 

 

-iii-

 

 

	

IX.

	

INFORMATION AS TO THE LOAN PARTIES

	

75

	

9.1.

	

Disclosure of Material Matters

	

75

	

9.2.

	

Schedules

	

75

	

9.3.

	

[Reserved]

	

75

	

9.4.

	

Litigation

	

76

	

9.5.

	

Material Occurrences

	

76

	

9.6.

	

Government Receivables

	

76

	

9.7.

	

Annual Financial Statements

	

76

	

9.8.

	

Quarterly Financial Statements

	

76

	

9.9.

	

Monthly Financial Statements

	

76

	

9.10.

	

Other Reports

	

77

	

9.11.

	

Additional Information

	

77

	

9.12.

	

Projected Operating Budget

	

77

	

9.13.

	

Variances From Operating Budget

	

77

	

9.14.

	

Notice of Suits, Adverse Events

	

77

	

9.15.

	

ERISA Notices and Requests

	

78

	

9.16.

	

Additional Documents

	

78

	

9.17.

	

Updates to Disclosure Schedule

	

78

	

X.

	

EVENTS OF DEFAULT

	

78

	

10.1.

	

Nonpayment

	

78

	

10.2.

	

Breach of Representation

	

79

	

10.3.

	

Financial Information

	

79

	

10.4.

	

Judicial Actions

	

79

	

10.5.

	

Noncompliance

	

79

	

10.6.

	

Judgments

	

79

	

10.7.

	

Bankruptcy

	

79

	

10.8.

	

Reserved

	

79

	

10.9.

	

Lien Priority

	

79

	

10.10.

	

Reserved

	

79

	

10.11.

	

Cross Default

	

80

	

10.12.

	

Breach of Guaranty, Guarantor Security Agreement or Pledge
Agreement

	

80

	

10.13.

	

Change of Control

	

80

	

10.14.

	

Invalidity

	

80

	

10.15.

	

Seizures

	

80

	

10.16.

	

Reserved

	

80

	

10.17.

	

Pension Plans

	

80

	

10.18.

	

Anti-Terrorism Laws

	

80

	

XI.

	

LENDERS’ RIGHTS AND REMEDIES AFTER DEFAULT

	

81

	

11.1.

	

Rights and Remedies

	

81

	

11.2.

	

Agent’s Discretion

	

83

	

11.3.

	

Setoff

	

83

	

11.4.

	

Rights and Remedies not Exclusive

	

83

	

11.5.

	

Allocation of Payments After Event of Default

	

83

 

 

 

-iv-

 

 

	

XII.

	

WAIVERS AND JUDICIAL PROCEEDINGS

	

84

	

12.1.

	

Waiver of Notice

	

84

	

12.2.

	

Delay

	

84

	

12.3.

	

Jury Waiver

	

85

	

XIII.

	

EFFECTIVE DATE AND TERMINATION

	

85

	

13.1.

	

Term

	

85

	

13.2.

	

Termination

	

85

	

XIV.

	

REGARDING AGENT

	

85

	

14.1.

	

Appointment

	

85

	

14.2.

	

Nature of Duties

	

86

	

14.3.

	

Lack of Reliance on Agent

	

86

	

14.4.

	

Resignation of Agent; Successor Agent

	

87

	

14.5.

	

Certain Rights of Agent

	

87

	

14.6.

	

Reliance

	

87

	

14.7.

	

Notice of Default

	

87

	

14.8.

	

Indemnification

	

88

	

14.9.

	

Agent in its Individual Capacity

	

88

	

14.10.

	

Delivery of Documents

	

88

	

14.11.

	

Loan Parties Undertaking to Agent

	

88

	

14.12.

	

No Reliance on Agent’s Customer Identification
Program

	

88

	

14.13.

	

Other Agreements

	

88

	

XV.

	

BORROWING AGENCY

	

89

	

15.1.

	

Borrowing Agency Provisions

	

89

	

15.2.

	

Waiver of Subrogation

	

89

	

XVI.

	

MISCELLANEOUS

	

90

	

16.1.

	

Governing Law; Judicial Reference; California Specific
Waivers

	

90

	

16.2.

	

Entire Understanding

	

92

	

16.3.

	

Successors and Assigns; Participations; New Lenders

	

95

	

16.4.

	

Application of Payments

	

97

	

16.5.

	

Indemnity

	

98

	

16.6.

	

Notice

	

99

	

16.7.

	

Survival

	

100

	

16.8.

	

Severability

	

100

	

16.9.

	

Expenses

	

100

	

16.10.

	

Injunctive Relief

	

100

	

16.11.

	

Consequential Damages

	

100

	

16.12.

	

Captions

	

100

	

16.13.

	

Counterparts; Facsimile Signatures

	

100

	

16.14.

	

Construction

	

100

	

16.15.

	

Confidentiality; Sharing Information

	

101

	

16.16.

	

Publicity

	

101

	

16.17.

	

Certifications From Banks and Participants; USA PATRIOT
Act

	

101

	

16.18.

	

Anti-Terrorism Laws

	

102

	

16.19.

	

Acknowledgment and Consent to Bail-In of EEA Financial
Institutions

	

102

	

XVII.

	

GUARANTY

	

102

	

17.1.

	

Guaranty

	

102

	

17.2.

	

Waivers

	

103

	

17.3.

	

No Defense

	

103

	

17.4.

	

Guaranty of Payment

	

103

	

17.5.

	

Liabilities Absolute

	

103

	

17.6.

	

Waiver of Notice

	

104

	

17.7.

	

Agent’s Discretion

	

104

	

17.8.

	

Reinstatement

	

104

 

 

-v-

 

 

LIST OF EXHIBITS
AND SCHEDULES

 

	

Exhibits

	
 

	
 

	
 

	

Exhibit 1.2(a)

	

Form of Borrowing Base Certificate

	

Exhibit 1.2(b)

	

Form of Compliance Certificate

	

Exhibit 2.1

	

Form of Revolving Credit Note

	

Exhibit 2.4

	

Form of Swing Loan Note

	

Exhibit 3.10

	

Forms of US Tax Compliance Certificates

	

Exhibit 8.1(b)

	

Form of Financial Condition Certificate

	

Exhibit 16.3

	

Form of Commitment Transfer Supplement

	
 

	
 

	
 

	
 

	

Schedules

	
 

	
 

	

Schedule 1.1

	

Commitments

 

 

 

 

-vi-

 

 

REVOLVING CREDIT

AND

SECURITY AGREEMENT

 

Revolving Credit
and Security Agreement, dated as of April 30, 2019, by and among
AUTOWEB, INC., a Delaware corporation (“AutoWeb”, and
together with each Person joined hereto as a borrower from time to
time, collectively, the “Borrowers” and each a
“Borrower”), CAR.COM, INC., a Delaware corporation
(“Car.com”), AUTOBYTEL, INC., a Delaware corporation
(“Autobytel”), AW GUA USA, INC., a Delaware corporation
(“AW GUA USA”, and together with Car.com, Autobytel and
each Person joined hereto as a guarantor from time to time,
collectively, the “Guarantors”, and each a
“Guarantor” and together with the Borrowers,
collectively, the “Loan Parties” and each a “Loan
Party”), the financial institutions which are now or which
hereafter become a party hereto (together with their respective
successors and assigns, collectively, the “Lenders” and
each individually a “Lender”), and PNC BANK, NATIONAL
ASSOCIATION (“PNC”), in its capacity as agent for
Lenders (in such capacity, together with its successors and
assigns, the “Agent”).

 

IN
CONSIDERATION of the mutual covenants and undertakings set forth
herein, the Loan Parties, Lenders and Agent hereby agree as
follows:

 

I. 
DEFINITIONS.

 

1.1. Accounting
Terms. As used in this
Agreement, the Other Documents or any certificate, report or other
document made or delivered pursuant to this Agreement, accounting
terms not defined in Section 1.2 hereof or elsewhere in this
Agreement and accounting terms partly defined in Section 1.2 hereof
to the extent not defined shall have the respective meanings given
to them under GAAP; provided, however that, whenever such
accounting terms are used for the purposes of determining
compliance with financial covenants in this Agreement, such
accounting terms shall be defined in accordance with GAAP,
consistently applied. If there occurs after the Closing Date any
change in GAAP that affects in any respect the calculation of any
covenant set forth in this Agreement or the definition of any term
defined under GAAP used in such calculations and Agent or Borrowing
Agent so request, Agent and the Loan Parties shall negotiate in
good faith to amend the provisions of this Agreement that relate to
the calculation of such covenants with the intent of having the
respective positions of Agent, Lenders and the Loan Parties after
such change in GAAP conform as nearly as possible to their
respective positions as of the Closing Date, provided, that, until
any such amendments have been agreed upon, the covenants in this
Agreement shall be calculated as if no such change in GAAP had
occurred and the Loan Parties shall provide additional financial
statements or supplements thereto, attachments to Compliance
Certificates and/or calculations regarding financial covenants as
Agent may reasonably require in order to provide the appropriate
financial information required hereunder with respect to the Loan
Parties both reflecting any applicable changes in GAAP and as
necessary to demonstrate compliance with the financial covenants
before giving effect to the applicable changes in
GAAP.

 

1.2. General
Terms. For purposes of
this Agreement the following terms shall have the following
meanings:

 

“Advance Rates” shall mean
the advance rates in respect of Eligible Receivables set forth in
Section 2.1(a) hereof.

 

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

 

“Affected Lender” shall
have the meaning set forth in Section 3.11 hereof.

 

 

 

-1-

 

 

“Affiliate” of any Person
shall mean any Person which, directly or indirectly, is in control
of, is controlled by, or is under common control with such Person.
For purposes of this definition, control of a Person shall mean the
power, direct or indirect, (x) to vote fifteen percent (15%) or
more of the Equity Interests having ordinary voting power for the
election of directors of such Person or other Persons performing
similar functions for any such Person, or (y) to direct or cause
the direction of the management and policies of such Person whether
by ownership of Equity Interests, contract or
otherwise.

 

“Agent” shall have the
meaning set forth in the preamble to this Agreement and shall
include its successors and permitted assigns.

 

“Agreement” shall mean
this Revolving Credit and Security Agreement, as the same may be
amended, modified, supplemented, renewed, restated or replaced from
time to time.

 

“Alternate Base Rate”
shall mean, for any day, a rate per annum equal to the highest of
(a) the Base Rate in effect on such day, (b) the sum of the
Overnight Bank Funding Rate in effect on such day plus one half of one percent
(0.5%), and (c) the sum of the Daily LIBOR Rate in effect on such
day plus one
percent (1.0%), so long as a Daily LIBOR Rate is offered,
ascertainable and not unlawful. Any change in the Alternate Base
Rate (or any component thereof) shall take effect at the opening of
business on the day such change occurs.

 

“Alternate Source” shall
have the meaning set forth in the definition of “Overnight
Bank Funding Rate”.

 

“Anti-Terrorism Laws”
shall mean any Laws relating to terrorism, trade sanctions programs
and embargoes, import/export licensing, money laundering or
bribery, and any regulation, order, or directive promulgated,
issued or enforced pursuant to such Laws, all as amended, modified,
supplemented or replaced from time to time.

 

“Applicable Law” shall
mean all Laws applicable to the Person, conduct, transaction,
covenant, Other Document or contract in question, all provisions of
all applicable state, federal and foreign constitutions, statutes,
rules, regulations, treaties, directives and orders of any
Governmental Body, and all orders, judgments and decrees of all
courts and arbitrators.

 

“Applicable Facility Fee
Percentage” shall mean (a) as of the Closing Date and
through and including June 30, 2019, an amount equal to 1.50%, and
(b) effective as of July 1, 2019 and on the first day of each
fiscal quarter thereafter (each an “Applicable Facility Fee
Percentage Adjustment Date”), the Applicable Facility Fee
Percentage shall be adjusted, if necessary, to the applicable
percentage per annum set forth in the table below corresponding to
the Quarterly Average Borrowings for the most recently completed
fiscal quarter prior to the Applicable Facility Fee Percentage
Adjustment Date:

 

	

Level

	

Quarterly Average Borrowings

	

Applicable Facility Fee Percentage

 

	

Applicable Default Facility Fee Percentage

 

	

1

	

$0

 

	

1.50%

	

2.50%

	

2

	

Greater
than $0 but less than $5,000,000

 

	

1.25%

	

2.25%

	

3

	

Greater
than or equal to $5,000,000 but less than $10,000,000

 

	

1.00%

	

1.50%

	

4

	

Greater
than or equal to $10,000,000

 

	

0.50%

	

1.00%

 

 

-2-

 

 

Notwithstanding
anything to the contrary set forth herein, immediately and
automatically upon the occurrence of an Event of Default, each
Applicable Facility Fee Percentage shall increase to the amount
specified in the table set forth above under the heading
“Applicable Default Facility Fee Percentage” and shall
continue at such percentage until the date (if any) on which such
Event of Default shall be waived in accordance with the provisions
of this Agreement.

 

“Applicable Margin” shall
mean (a) an amount equal to two percent (2%) for (i) Revolving
Advances consisting of Domestic Rate Loans and (ii) Swing Loans,
and (b) an amount equal to three percent (3%) for Revolving
Advances consisting of LIBOR Rate Loans.

 

“Application Date” shall
have the meaning set forth in Section 2.8(b) hereof.

 

“Approvals” shall have the
meaning set forth in Section 5.7(b) hereof.

 

“Approved Electronic
Communication” shall mean each notice, demand,
communication, information, document and other material
transmitted, posted or otherwise made or communicated by e-mail,
e-fax, the Credit Management Module of PNC’s PINACLE®
system, or any other equivalent electronic service agreed to by
Agent, whether owned, operated or hosted by Agent, any Lender, any
of their Affiliates or any other Person, that any party is
obligated to, or otherwise chooses to, provide to Agent pursuant to
this Agreement or any Other Document, including any financial
statement, financial and other report, notice, request, certificate
and other information material; provided that Approved Electronic
Communications shall not include any notice, demand, communication,
information, document or other material that Agent specifically
instructs a Person to deliver in physical form.

 

“Autobytel” shall have the
meaning set forth in the preamble to this Agreement and shall
extend to all permitted successors and assigns of such
Person.

 

“AutoWeb”
shall have the meaning set forth in the preamble to this Agreement
and shall extend to all permitted successors and assigns of such
Person.

 

“AW GUA USA” shall have
the meaning set forth in the preamble to this Agreement and shall
extend to all permitted successors and assigns of such
Person.

 

“Bail-In Action” shall
mean the exercise of any Write-Down and Conversion Powers by the
applicable EEA Resolution Authority in respect of any liability of
an EEA Financial Institution.

 

“Bail-In Legislation”
shall mean, with respect to any EEA Member Country implementing
Article 44 of Directive 2014/59/EU of the European Parliament and
of the Council of the European Union, the implementing law for such
EEA Member Country from time to time which is described in the
Bail-In Legislation Schedule.

 

“Bail-In Legislation
Schedule” shall mean the EU Bail-In Legislation
Schedule published by the Loan Market Association (or any successor
person), as in effect from time to time.

 

“Base Rate” shall mean the
base commercial lending rate of PNC as publicly announced to be in
effect from time to time, such rate to be adjusted automatically,
without notice, on the effective date of any change in such rate.
This rate of interest is determined from time to time by PNC as a
means of pricing some loans to its customers and is neither tied to
any external rate of interest or index nor does it necessarily
reflect the lowest rate of interest actually charged by PNC to any
particular class or category of customers of PNC.

 

“Benefited Lender” shall
have the meaning set forth in Section 2.6(e) hereof.

 

“Blocked Account Banks”
shall have the meaning set forth in Section 4.8(h)
hereof.

 

“Blocked Accounts” shall
have the meaning set forth in Section 4.8(h) hereof.

 

 

 

-3-

 

 

“Borrower” or
“Borrowers” shall have the
meaning set forth in the preamble to this Agreement and shall
extend to all permitted successors and assigns of such
Persons.

 

“Borrowers’ Account”
shall have the meaning set forth in Section 2.10
hereof.

 

“Borrowing Agent” shall
mean AutoWeb.

 

“Borrowing Base
Certificate” shall mean a certificate in substantially
the form of Exhibit 1.2(a) hereto duly executed by the Chief
Executive Officer, Chief Financial Officer or Controller of
Borrowing Agent and delivered to Agent, appropriately completed, by
which such officer shall certify to Agent the Formula Amount and
calculation thereof as of the date set forth therein.

 

“Business Day” shall mean
any day other than Saturday or Sunday or a legal holiday on which
commercial banks are authorized or required by law to be closed for
business in East Brunswick, New Jersey and, if the applicable
Business Day relates to any LIBOR Rate Loans, such day must also be
a day on which dealings are carried on in the London interbank
market.

 

“Capital Expenditures”
shall mean expenditures made or liabilities incurred for the
acquisition of any fixed assets or improvements (or of any
replacements or substitutions thereof or additions thereto) which
have a useful life of more than one year and which, in accordance
with GAAP, would be classified as capital expenditures. Capital
Expenditures for any period shall include the principal portion of
Capitalized Lease Obligations paid in such period.

 

“Capitalized Lease
Obligation” shall mean any Indebtedness of any Loan
Party represented by obligations under a lease that is required to
be capitalized for financial reporting purposes in accordance with
GAAP.

 

“Cash Equivalents” shall
mean (a) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States or issued by any
agency thereof and backed by the full faith and credit of the
United States, in each case maturing within one year from the date
of acquisition thereof, (b) marketable direct obligations issued or
fully guaranteed by any state of the United States or any political
subdivision of any such state or any public instrumentality thereof
maturing within one year from the date of acquisition thereof and,
at the time of acquisition, having one of the two highest ratings
obtainable from either S&P or Moody’s,
(c) commercial paper maturing no more than 270 days from the
date of creation thereof and, at the time of acquisition, having a
rating of at least A-1 from S&P or at least P-1 from
Moody’s, (d) certificates of deposit, time deposits,
overnight bank deposits or bankers’ acceptances maturing
within one year from the date of acquisition thereof issued by any
bank organized under the laws of the United States or any state
thereof or the District of Columbia or any United States branch of
a foreign bank having at the date of acquisition thereof combined
capital and surplus of not less than $500,000,000, (e) deposit
accounts maintained with (i) any bank that satisfies the criteria
described in clause (d) above, or (ii) any other bank
organized under the laws of the United States or any state thereof
so long as the full amount maintained with any such other bank is
insured by the Federal Deposit Insurance Corporation, (f)
repurchase obligations of any commercial bank satisfying the
requirements of clause (d) of this definition or recognized
securities dealer having combined capital and surplus of not less
than $500,000,000, having a term of not more than seven days, with
respect to securities satisfying the criteria in clauses (a) or (d)
above, (g) debt securities with maturities of six months or less
from the date of acquisition backed by standby letters of credit
issued by any commercial bank satisfying the criteria described in
clause (d) above, and (h) Investments in money market funds
substantially all of whose assets are invested in the types of
assets described in clauses (a) through (g) above.

 

 

 

-4-

 

 

“Cash Management
Liabilities” shall mean the indebtedness, obligations
and liabilities of any Loan Party to the provider of any Cash
Management Products and Services (including all obligations and
liabilities owing to such provider in respect of any returned items
deposited with such provider). For purposes of this Agreement and
all of the Other Documents, all Cash Management Liabilities of any
Loan Party owing to any of the Secured Parties shall be
“Obligations” hereunder and under the Other Documents,
and the Liens securing such Cash Management Liabilities shall be
pari passu with the Liens securing
all other Obligations under this Agreement and the Other Documents,
subject to the express provisions of Section 11.5
hereof.

 

“Cash Management Products and
Services” shall mean agreements or other arrangements
under which Agent or any Lender or any Affiliate of Agent or a
Lender provides any of the following products or services to any
Loan Party: (a) credit cards; (b) credit card processing
services; (c) debit cards and stored value cards;
(d) commercial cards; (e) ACH transactions; and
(f) cash management and treasury management services and
products, including without limitation controlled disbursement
accounts or services, lockboxes, automated clearinghouse
transactions, overdrafts, interstate depository network
services.

 

“CEA” shall mean the
Commodity Exchange Act (7 U.S.C. §1 et seq.), as amended from
time to time, and any successor statute.

 

“CERCLA” shall mean the
Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended, 42 U.S.C. §§9601 et
seq.

 

“CFTC” shall mean the
Commodity Futures Trading Commission.

 

“Change in Law” shall mean
the occurrence, after the Closing Date, of any of the following:
(a) the adoption or taking effect of any Applicable Law;
(b) any change in any Applicable Law or in the administration,
implementation, interpretation or application thereof by any
Governmental Body; or (c) the making or issuance of any
request, rule, guideline or directive (whether or not having the
force of law) by any Governmental Body; provided that notwithstanding
anything herein to the contrary, (x) the Dodd-Frank Wall Street
Reform and Consumer Protection Act and all requests, rules,
regulations, guidelines, interpretations or directives thereunder
or issued in connection therewith (whether or not having the force
of Applicable Law) and (y) all requests, rules, regulations,
guidelines, interpretations or directives promulgated by the Bank
for International Settlements, the Basel Committee on Banking
Supervision (or any successor or similar authority) or the United
States or foreign regulatory authorities (whether or not having the
force of law), in each case pursuant to Basel III, shall in each
case be deemed to be a Change in Law regardless of the date
enacted, adopted, issued, promulgated or implemented.

 

“Change of Control” shall
mean: (a) any person or group of persons (within the meaning of
Section 13(d) or 14(a) of the Exchange Act) shall have
acquired beneficial ownership (within the meaning of Rule 13d-3
promulgated by the SEC under the Exchange Act) of 35% or more of
the voting Equity Interests of AutoWeb; (b) during any period of 12
consecutive months, a majority of the members of the board of
directors of AutoWeb cease to be composed of individuals (i) who
were members of that board or equivalent governing body on the
first day of such period, (ii) whose election or nomination to that
board was approved by individuals referred to in clause (i) above
constituting at the time of such election or nomination at least a
majority of that board, or (iii) whose election or nomination to
that board was approved by individuals referred to in clauses (i)
and (ii) above constituting at the time of such election or
nomination at least a majority of that board; and (c) any merger,
consolidation or sale of substantially all of the property or
assets of any Loan Party other than as permitted by this
Agreement.

 

 

 

-5-

 

 

“Charges” shall mean all
taxes, charges, fees, imposts, levies or other assessments,
including all net income, gross income, gross receipts, sales, use,
ad valorem, value added, transfer, franchise, profits, inventory,
capital stock, license, withholding, payroll, employment, social
security, unemployment, excise, severance, stamp, occupation and
property taxes, custom duties, fees, assessments, liens, claims and
charges of any kind whatsoever, together with any interest and any
penalties, additions to tax or additional amounts, imposed by any
taxing authority or other Governmental Body, domestic or foreign
(including the PBGC or any environmental agency or superfund), upon
the Collateral, any Loan Party or any of its Subsidiaries or
Affiliates.

 

“CIP Regulations” shall
have the meaning set forth in Section 14.12 hereof.

 

“Claims” shall have the
meaning set forth in Section 16.5 hereof.

 

“Closing Date” shall mean
the date of this Agreement.

 

“Code” shall mean the
Internal Revenue Code of 1986, as the same may be amended, modified
or supplemented from time to time, and any successor statute of
similar import, and the rules and regulations thereunder, as from
time to time in effect.

 

“Collateral” shall mean
and include all right, title and interest of each Loan Party in all
of the following property and assets of such Loan Party, in each
case whether now existing or hereafter arising or created and
whether now owned or hereafter acquired and wherever
located:

 

(a) all Receivables
and all supporting obligations relating thereto;

 

(b) all Equipment and
fixtures;

 

(c) all general
intangibles (including all payment intangibles and all software)
and all supporting obligations related thereto;

 

(d) all
Inventory;

 

(e) all Subsidiary
Stock, securities, Investment Property, and financial
assets;

 

(f) all Pledged
Cash;

 

(g)
all contract
rights, rights of payment which have been earned under any
contract, chattel paper (including electronic chattel paper and
tangible chattel paper), commercial tort claims (whether now
existing or hereafter arising); documents (including all warehouse
receipts and bills of lading), deposit accounts, goods, instruments
(including promissory notes), letters of credit (whether or not the
respective letter of credit is evidenced by a writing) and
letter-of-credit rights, cash, certificates of deposit, insurance
proceeds (including hazard, flood and credit insurance), security
agreements, eminent domain proceeds, condemnation proceeds, tort
claim proceeds and all supporting obligations;

 

(h) all ledger sheets,
ledger cards, files, correspondence, records, books of account,
business papers, computers, computer software (owned by such Loan
Party or in which it has an interest), computer programs, tapes,
disks and documents, including all of such property relating to the
property described in clauses (a) through and including (g) of this
definition; and

 

(i) all proceeds and
products of the property described in clauses (a) through and
including (h) of this definition, in whatever form.

 

 

 

-6-

 

 

It is
the intention of the parties hereto that if Agent shall fail to
have a perfected Lien in any particular property or assets of any
Loan Party for any reason whatsoever, but the provisions of this
Agreement and/or of the Other Documents, together with all
financing statements and other public filings relating to Liens
filed or recorded by Agent against the Loan Parties, would be
sufficient to create a perfected Lien in any property or assets
that such Loan Party may receive upon the sale, lease, license,
exchange, transfer or disposition of such particular property or
assets, then all such “proceeds” of such particular
property or assets shall be included in the Collateral as original
collateral that is the subject of a direct and original grant of a
security interest as provided for herein and in the Other Documents
(and not merely as proceeds (as defined in Article 9 of the Uniform
Commercial Code) in which a security interest is created or arises
solely pursuant to Section 9-315 of the Uniform Commercial
Code).

 

Notwithstanding
the foregoing, Collateral shall not include any Excluded
Property.

 

“Commitments” shall mean
the Revolving Commitments.

 

“Commitment Transfer
Supplement” shall mean a document in the form of
Exhibit 16.3 hereto, properly completed and otherwise in form and
substance satisfactory to Agent by which the Purchasing Lender
purchases and assumes all or a portion of the right, title and
interest of the assigning Lender in respect of the outstanding
Revolving Advances and Letters of Credit and such assigning
Lender’s Revolving Commitments hereunder.

 

“Compliance Certificate”
shall mean a compliance certificate substantially in the form of
Exhibit 1.2(b) hereto to be signed by the Chief Executive Officer,
Chief Financial Officer or Controller of Borrowing Agent, which
compliance certificate shall contain updates to the Disclosure
Schedule as provided by Section 9.17 hereto.

 

“Consents” shall mean all
filings and all licenses, permits, consents, approvals,
authorizations, qualifications and binding orders of Governmental
Bodies and other third parties, domestic or foreign, necessary to
carry on any Loan Party’s business or necessary (including to
avoid a conflict or breach under any agreement, instrument, other
document, license, permit or other authorization) for the
execution, delivery or performance of this Agreement, the Other
Documents, including any Consents required under all applicable
federal, state or other Applicable Law.

 

“Consolidated Basis” shall
mean, with respect to the Borrowers or the Loan Parties, as the
context shall require, the consolidation in accordance with GAAP of
the accounts or other items of the Borrowers and their respective
Subsidiaries or the Loan Parties and their respective
Subsidiaries.

 

“Contract Rate” shall have
the meaning set forth in Section 3.1 hereof.

 

“Controlled Group” shall
mean, at any time, each Loan Party and all members of a controlled
group of corporations and all trades or businesses (whether or not
incorporated) under common control and all other entities which,
together with any Loan Party, are treated as a single employer
under Section 414 of the Code.

 

“Covered Entity” shall
mean (a) each Loan Party, each Subsidiary of each Loan Party, all
Guarantors and all pledgors of Collateral and (b) each Person that,
directly or indirectly, is in control of a Person described in
clause (a) above. For purposes of this definition, control of a
Person shall mean the direct or indirect (x) ownership of, or power
to vote, twenty-five percent (25%) or more of the issued and
outstanding equity interests having ordinary voting power for the
election of directors of such Person or other Persons performing
similar functions for such Person, or (y) power to direct or cause
the direction of the management and policies of such Person whether
by ownership of equity interests, contract or
otherwise.

 

 

 

-7-

 

 

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

 

“Customs” shall have the
meaning set forth in Section 2.13(b) hereof.

 

“Daily LIBOR Rate” shall
mean, for any day, the rate per annum determined by Agent by
dividing (x) the Published Rate by (y) a number equal to 1.00
minus the Reserve
Percentage; provided, however, that if the Daily
LIBOR Rate determined as provided above would be less than zero,
such rate shall be deemed to be zero for purposes of this
Agreement.

 

“Default” shall mean an
event, circumstance or condition which, with the giving of notice
or passage of time or both, would constitute an Event of
Default.

 

“Default Rate” shall have
the meaning set forth in Section 3.1 hereof.

 

“Defaulting Lender” shall
mean any Lender that: (a) has failed, within two (2) Business Days
of the date required to be funded or paid, to (i) fund any portion
of its Revolving Commitment Percentage of Advances, (ii) if
applicable, fund any portion of its Participation Commitment in
Letters of Credit or Swing Loans or (iii) pay over to Agent, any
Issuer, Swing Loan Lender or any Lender any other amount required
to be paid by it hereunder, unless, in the case of clause (i)
above, such Lender notifies Agent in writing that such failure is
the result of such Lender’s good faith determination that a
condition precedent to funding (specifically identified and
including a particular Default or Event of Default, if any) has not
been satisfied; (b) has notified the Loan Parties or Agent in
writing, or has made a public statement to the effect, that it does
not intend or expect to comply with any of its funding obligations
under this Agreement (unless such writing or public statement
indicates that such position is based on such Lender’s good
faith determination that a condition precedent (specifically
identified and including a particular Default or Event of Default,
if any) to funding an Advance under this Agreement cannot be
satisfied) or generally under other agreements in which it commits
to extend credit; (c) has failed, within two (2) Business Days
after request by Agent, acting in good faith, to provide a
certification in writing from an authorized officer of such Lender
that it will comply with its obligations (and is financially able
to meet such obligations) to fund prospective Advances and, if
applicable, participations in then outstanding Letters of Credit
and Swing Loans under this Agreement, provided that such Lender
shall cease to be a Defaulting Lender pursuant to this clause (c)
upon Agent’s receipt of such certification in form and
substance satisfactory to Agent; (d) has become the subject of an
Insolvency Event; or (e) has failed at any time to comply with the
provisions of Section 2.6(e) hereof with respect to purchasing
participations from the other Lenders, whereby such Lender’s
share of any payment received, whether by setoff or otherwise, is
in excess of its pro rata share of such payments due and payable to
all of the Lenders.

 

“Depository Accounts”
shall have the meaning set forth in Section 4.8(h)
hereof.

 

“Designated Lender” shall
have the meaning set forth in Section 16.2(c) hereof.

 

“Disclosure Schedule”
shall mean the disclosure letter delivered by Loan Parties to Agent
on the Closing Date, as updated pursuant to Section 9.17 hereof; it
being understood that the information disclosed in one section of
the Disclosure Schedule is deemed to be included in each other
section of the Disclosure Schedule in which the relevance of such
information would be readily apparent on the face
thereof.

 

“Disposition” shall mean,
with respect to any particular property or asset (other than cash
or Cash Equivalents), the sale, lease, license, exchange, transfer
or other disposition of such property or asset, and to
“Dispose” of any
particular property or asset shall mean to sell, lease, license,
exchange, transfer or otherwise dispose of such property or
asset.

 

 

 

-8-

 

 

“Disqualified Equity
Interests” shall mean any Equity Interests which, by
their terms (or by the terms of any security or other Equity
Interests into which they are convertible or for which they are
exchangeable), or upon the happening of any event or condition, (a)
mature or are mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or are redeemable at the option of the
holder thereof, in whole or in part, on or prior to the date which
is 91 days following the last day of the Term (excluding any
provisions requiring redemption upon a “change of
control” or similar event; provided that such “change
of control” or similar event results in the Payment in Full
of the Obligations), (b) are convertible into or exchangeable for
(i) debt securities or (ii) any Equity Interests referred to in
clause (a) above, in each case, at any time on or prior to the date
which is 91 days following the last day of the Term, or (c) are
entitled to receive scheduled dividends or distributions in cash
prior to the time that the Obligations are Paid in
Full.

 

“Document” shall have the
meaning given to the term “document” in the Uniform
Commercial Code.

 

“Dollar” and the sign
“$”
shall mean lawful money of the United States of
America.

 

“Domestic Rate Loan” shall
mean any Advance that bears interest based upon the Alternate Base
Rate.

 

“Drawing Date” shall have
the meaning set forth in Section 2.14(b) hereof.

 

“EBITDA” shall mean for
any Person for any period of determination, the sum of (a) net
income (or loss) of such Person for such period (excluding
extraordinary gains and losses), plus (b) all Interest Expense of
such Person for such period, plus (c) all charges against income of
such Person for such period for federal, state and local taxes,
plus (d) all depreciation expenses of such Person for such period,
plus (e) all amortization expenses of such Person for such period,
plus (f) non-cash losses for such period, minus (g) non-cash gains
for such period, plus (h) all non-cash stock compensation expense
of such Person for such period.

 

“EEA Financial
Institution” shall mean (a) any credit institution or
investment firm established in any EEA Member Country which is
subject to the supervision of an EEA Resolution Authority, (b) any
entity established in an EEA Member Country which is a parent of an
institution described in clause (a) of this definition, or (c) any
financial institution established in an EEA Member Country which is
a subsidiary of an institution described in clauses (a) or (b) of
this definition and is subject to consolidated supervision with its
parent.

 

“EEA Member Country” shall
mean any of the member states of the European Union, Iceland,
Liechtenstein and Norway.

 

“EEA Resolution Authority”
shall mean any public administrative authority or any person
entrusted with public administrative authority of any EEA Member
Country (including any delegee) having responsibility for the
resolution of any EEA Financial Institution.

 

“Effective Date” shall
mean the date indicated in a document or agreement to be the date
on which such document or agreement becomes effective, or, if there
is no such indication, the date of execution of such document or
agreement.

 

“Eligibility
Date” shall mean, with respect to each
Loan Party and each Swap, the date on which this Agreement or any
Other Document becomes effective with respect to such Swap (for the
avoidance of doubt, the Eligibility Date shall be the Effective
Date of such Swap if this Agreement or any Other Document is then
in effect with respect to such Loan Party, and otherwise it shall
be the Effective Date of this Agreement and/or such Other Documents
to which such Loan Party is a party).

 

“Eligible Contract
Participant” shall mean an “eligible contract
participant” as defined in the CEA and regulations
thereunder.

 

 

 

-9-

 

 

“Eligible Insured Foreign
Receivables” shall mean each Receivable of a Borrower
arising in the Ordinary Course of Business that (a) would be an
Eligible Receivable but for clause (g) of the definition of
“Eligible Receivables” and (b) is credit insured (the
insurance carrier, amount and terms of such insurance shall be
reasonably acceptable to Agent and shall name Agent as beneficiary
or loss payee, as applicable).

 

“Eligible Receivables”
shall mean and include each Receivable of a Borrower arising in the
Ordinary Course of Business unless:

 

(a)

such Receivable
arises out of a sale made by any Borrower to an Affiliate of any
Borrower or to a Person controlled by an Affiliate of any
Borrower;

 

(b)

such Receivable is
due or unpaid more than ninety (90) days after the original invoice
date or sixty (60) days after the original due date;

 

(c)

such Receivable is
due from a Customer with respect to which fifty percent (50%) or
more of the Receivables owing from such Customer are not deemed
Eligible Receivables hereunder (as such percentage may, in
Agent’s Permitted Discretion, be increased or decreased from
time to time pursuant to Section 2.1(b) hereof);

 

(d)

such Receivable is
not subject to Agent’s first priority perfected Lien or is
subject to any other Liens (other than Permitted
Encumbrances);

 

(e)

any covenant,
representation or warranty set forth in this Agreement with respect
to such Receivable has been breached in any material
respect;

 

(f)

such Receivable is
due from a Customer with respect to which an Insolvency Event shall
have occurred;

 

(g)

the sale giving
rise to such Receivable is to a Customer outside the continental
United States of America or a province of Canada that has not
adopted the Personal Property Security Act of Canada, unless such
sale is on letter of credit, guaranty or acceptance terms, in each
case acceptable to Agent in its Permitted Discretion or such
Receivable constitutes an Eligible Insured Foreign
Receivable;

 

(h)

the sale giving
rise to such Receivable is on a bill-and-hold, guaranteed sale,
sale-and-return, sale on approval, consignment or any other
repurchase or return basis with the applicable Customer or is
evidenced by chattel paper;

 

(i)

Agent believes, in
its sole discretion, that the ability of Agent to collect such
Receivable is insecure or that such Receivable may not be paid by
reason of the Customer’s financial inability to
pay;

 

(j)

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

 

(k)

the goods giving
rise to such Receivable have not been delivered to and accepted by
the Customer, the services giving rise to such Receivable have not
been performed by the applicable Borrower and accepted by the
Customer or such Receivable otherwise does not represent a final
sale;

 

 

 

-10-

 

 

(l)

the Receivables of
the Customer from which such Receivable is owing exceeds the credit
limit determined by Agent in its Permitted Discretion pursuant to
Section 2.1(b) hereof, to the extent such Receivable exceeds such
limit;

 

(m)

such Receivable is
subject to any offset, deduction, defense, dispute, credit or
counterclaim (because, among other reasons, the Customer is also a
creditor or supplier of a Borrower) or the Receivable is contingent
in any respect or for any reason (but such Receivable shall only be
ineligible to the extent of such offset, deduction, defense,
dispute, credit or counterclaim or contingency);

 

(n)

the applicable
Borrower has made any agreement with any Customer for any deduction
therefrom, except for discounts or allowances made in the Ordinary
Course of Business for prompt payment, all of which discounts or
allowances are reflected in the calculation of the face value of
each respective invoice related thereto;

 

(o)

such Receivable is
not payable to a Borrower;

 

(p)

such Receivable is
not evidenced by an invoice or other documentary evidence issued or
prepared by the Borrower in the Ordinary Course of Business (or
otherwise satisfactory to Agent in its Permitted Discretion);
or

 

(q)

such Receivable is
not otherwise satisfactory to Agent as determined by Agent in its
Permitted Discretion based on such considerations as Agent may from
time to time deem appropriate in accordance with Section 2.1(b)
hereof.

 

“Eligible Unbilled
Receivables” shall mean and include each Receivable of
a Borrower arising in the Ordinary Course of Business that (a)
would be an Eligible Receivable but for clause (p) of the
definition of “Eligible Receivables” and (b) shall
become a standard billed Receivable in the Ordinary Course of
Business pursuant to an invoice or other documentary evidence
issued or prepared by the Borrower in the Ordinary Course of
Business (or otherwise satisfactory to Agent in its Permitted
Discretion) within thirty (30) days after the date of completion of
the services or the delivery of the goods giving rise to such
Receivable.

 

“Environmental Complaint”
shall have the meaning set forth in Section 9.3(b)
hereof.

 

“Environmental Laws” shall
mean all federal, state and local environmental, land use, zoning,
health, chemical use, safety and sanitation Laws relating to the
protection of the environment, human health and/or governing the
use, storage, treatment, generation, transportation, processing,
handling, production or disposal of Hazardous Materials and the
rules, regulations, policies, guidelines, interpretations,
decisions, orders and directives of federal, state, international
and local governmental agencies and authorities with respect
thereto.

 

“Equipment” shall have the
meaning given to the term “equipment” in the Uniform
Commercial Code.

 

 

 

-11-

 

 

“Equity Interests” shall
mean, with respect to any Person, any and all shares, rights to
purchase, options, warrants, general, limited or limited liability
partnership interests, member interests, participation or other
equivalents of or interest in (regardless of how designated) equity
of such Person, whether voting or nonvoting, including common
stock, preferred stock, convertible securities or any other
“equity security” (as such term is defined in Rule
3a11-1 of the General Rules and Regulations promulgated by the SEC
under the Exchange Act), including in each case all of the
following rights relating to such Equity Interests, whether arising
under the Organizational Documents of the Person issuing such
Equity Interests (the “Equity Issuer”) or under the
Applicable Laws of such Equity Issuer’s jurisdiction of
organization relating to the formation, existence and governance of
corporations, limited liability companies or partnerships or
business trusts or other legal entities, as the case may be: (i)
all economic rights (including all rights to receive dividends and
distributions) relating to such Equity Interests; (ii) all voting
rights and rights to consent to any particular actions by the
applicable Equity Issuer; (iii) all management rights with respect
to such Equity Issuer; (iv) in the case of any Equity Interests
consisting of a general partner interest in a partnership, all
powers and rights as a general partner with respect to the
management, operations and control of the business and affairs of
the applicable Equity Issuer; (v) in the case of any Equity
Interests consisting of the membership/limited liability company
interests of a managing member in a limited liability company, all
powers and rights as a managing member with respect to the
management, operations and control of the business and affairs of
the applicable Equity Issuer; (vi) all rights to designate or
appoint or vote for or remove any officers, directors, managers,
general partners or managing members of such Equity Issuer and/or
any members of any board of members/managers/partners/directors
that may at any time have any rights to manage and direct the
business and affairs of the applicable Equity Issuer under its
Organizational Documents as in effect from time to time or under
Applicable Law; (vii) all rights to amend the Organizational
Documents of such Equity Issuer, (viii) in the case of any Equity
Interests in a partnership or limited liability company, the status
of the holder of such Equity Interests as a “partner”,
general or limited, or “member” (as applicable) under
the applicable Organizational Documents and/or Applicable Law; and
(ix) all certificates evidencing such Equity
Interests.

 

“ERISA” shall mean the
Employee Retirement Income Security Act of 1974, as the same may be
amended, modified or supplemented from time to time and the rules
and regulations promulgated thereunder.

 

“Event of Default” shall
have the meaning set forth in Article X hereof.

 

“Exchange Act” shall mean
the Securities Exchange Act of 1934, as amended.

 

“Excluded Accounts” shall
mean (a) any deposit account where the balance thereof does
not exceed $20,000 at any one time, provided that the aggregate
amount on deposit in all such accounts does not exceed $100,000 at
any one time and (b) deposit accounts specially and
exclusively used for payroll, payroll taxes and other employee wage
and benefit payments to or for employees of the Loan Parties or any
of their Subsidiaries.

 

“Excluded Hedge Liability or
Liabilities” shall mean, with respect to each
Loan Party, each of its Swap Obligations if, and only to the extent
that, all or any portion of this Agreement or any Other Document
that relates to such Swap Obligation is or becomes illegal under
the CEA, or any rule, regulation or order of the CFTC, solely by
virtue of such Loan Party’s failure to qualify as an Eligible
Contract Participant on the Eligibility Date for such Swap.
Notwithstanding the foregoing or any other provision of this
Agreement or any Other Document to the contrary, the foregoing is
subject to the following provisos: (a) if a Swap Obligation arises
under a master agreement governing more than one Swap, this
definition shall apply only to the portion of such Swap Obligation
that is attributable to Swaps for which such guaranty or security
interest is or becomes illegal under the CEA, or any rule,
regulations or order of the CFTC, solely as a result of the failure
by such Loan Party for any reason to qualify as an Eligible
Contract Participant on the Eligibility Date for such Swap; (b) if
a guarantee of a Swap Obligation would cause such obligation to be
an Excluded Hedge Liability but the grant of a security interest
would not cause such obligation to be an Excluded Hedge Liability,
such Swap Obligation shall constitute an Excluded Hedge Liability
for purposes of the guaranty but not for purposes of the grant of
the security interest; and (c) if there is more than one Loan Party
executing this Agreement or the Other Documents and a Swap
Obligation would be an Excluded Hedge Liability with respect to one
or more of such Loan Parties Loan Parties, but not all of them, the
definition of “Excluded Hedge Liability or Liabilities”
with respect to each such Loan Party shall only be deemed
applicable to (i) the particular Swap Obligations that constitute
Excluded Hedge Liabilities with respect to such Loan Party, and
(ii) the particular Loan Party with respect to which such Swap
Obligations constitute Excluded Hedge Liabilities.

 

 

 

-12-

 

 

“Excluded Property” shall
mean (a) any Equity Interest that is not Subsidiary Stock and (b)
any non-material lease, license, contract or agreement to which any
Loan Party is a party, and any of its rights or interests
thereunder, if and to the extent that a security interest therein
is prohibited by or in violation of (x) any Applicable Law, or (y)
a term, provision or condition of any such lease, license, contract
or agreement (unless in each case, such Applicable Law, term,
provision or condition would be rendered ineffective with respect
to the creation of such security interest pursuant to Sections
9-406, 9-407, 9-408 or 9-409 of the Uniform Commercial Code (or any
successor provision or provisions) of any relevant jurisdiction or
any other Applicable Law or principles of equity), provided, however, that the foregoing
shall cease to be treated as “Excluded Property” (and
shall constitute Collateral) immediately at such time as the
contractual or legal prohibition shall no longer be applicable and
to the extent severable, such security interest shall attach
immediately to any portion of such lease, license, contract or
agreement not subject to the prohibitions specified in clauses (x)
or (y) above, provided, further that Excluded Property
shall not include any proceeds of any such lease, license, contract
or agreement or any goodwill of the Loan Parties’ business
associated therewith or attributable thereto.

 

“Excluded Taxes” shall
mean any of the following Taxes on or with respect to Agent, any
Lender, Swing Loan Lender, any Issuer or any other recipient or
required to be withheld or deducted from a payment to any such
recipient, (a) Taxes imposed on or measured by net income
(however denominated), franchise Taxes, and branch profits Taxes,
in each case, imposed as a result of such recipient being organized
under the Laws of, or having its principal office or, in the case
of any Lender, its applicable lending office located in, the
jurisdiction imposing such Tax (or any political subdivision
thereof), (b) in the case of a Lender, U.S. federal
withholding Taxes imposed on amounts payable to or for the account
of such Lender with respect to an applicable interest in an Advance
or Commitment pursuant to a Law in effect on the date on which (i)
such Lender acquired such interest in the Advance or Commitment
(other than pursuant to an assignment request pursuant by the
Borrowers pursuant to Section 3.11 hereof) or (ii) such Lender
changes its lending office, except in each case to the extent that,
pursuant to Section 3.10 hereof, amounts with respect to such Taxes
were payable either to such Lender’s assignor immediately
before such Lender became a party hereto or to such Lender
immediately before it changed its lending office, (c) Taxes
attributable to such Lender’s failure to comply with Section
3.10(g) hereof, or (d) any U.S. federal withholding Taxes imposed
under FATCA.

 

“Facility Fee” shall have
the meaning set forth in Section 3.3(b) hereof.

 

“FATCA” shall mean
Sections 1471 through 1474 of the Code, as of the Closing Date (or
any amended or successor version that is substantively comparable
and not materially more onerous to comply with), any current or
future regulations thereunder or official interpretations thereof
and any agreements entered into pursuant to Section 1471(b)(1) of
the Code.

 

 “Federal
Funds Effective Rate” shall mean, for any day, the
rate per annum (based on a year of 360 days and actual days elapsed
and rounded upward to the nearest 1/100 of 1%) calculated by the
Federal Reserve Bank of New York (or any successor), based on such
day’s overnight federal funds transactions by depositary
institutions, as determined in such manner as such Federal Reserve
Bank (or any successor) shall set forth on its public website from
time to time, and as published on the next succeeding Business Day
by such Federal Reserve Bank as the “Federal Funds Effective
Rate”; provided, if such Federal Reserve Bank (or its
successor) does not publish such rate on any day, the
“Federal Funds Effective Rate” for such day shall be
the Federal Funds Effective Rate for the last day on which such
rate was determined.

 

“Fee Letter” shall mean
the fee letter, dated as of the Closing Date, among Borrowers and
Agent.

 

 

 

-13-

 

 

“Flood Laws” shall mean
all Applicable Laws relating to policies and procedures that
address requirements placed on federally regulated lenders under
the National Flood Insurance Reform Act of 1994 and other
Applicable Laws related thereto.

 

“Foreign Lender” shall
mean any Lender that is organized under the Laws of a jurisdiction
other than that in which the Loan Parties are resident for income
Tax purposes. For purposes of this definition, the United States of
America, each State thereof and the District of Columbia shall be
deemed to constitute a single jurisdiction.

 

“Foreign Subsidiary” shall
mean any Subsidiary of any Person that is not organized or
incorporated in the United States, any State or territory thereof
or the District of Columbia.

 

“Formula Amount” shall
have the meaning set forth in Section 2.1(a) hereof.

 

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

 

“Governmental Acts” shall
mean any act or omission, whether rightful or wrongful, of any
present or future de jure or de facto Governmental
Body.

 

“Governmental Body” shall
mean any nation or government, any state or other political
subdivision thereof or any entity, authority, agency, division or
department exercising the executive, legislative, judicial, taxing,
regulatory or administrative powers or functions of or pertaining
to a government (including any supra-national bodies such as the
European Union or the European Central Bank) and any group or body
charged with setting financial accounting or regulatory capital
rules or standards (including, without limitation, the Financial
Accounting Standards Board, the Bank for International Settlements
or the Basel Committee on Banking Supervision or any successor or
similar authority to any of the foregoing).

 

“Guarantor” or
“Guarantors” shall have
the meaning set forth in the preamble to this Agreement and shall
extend to all permitted successors and assigns of such
Persons.

 

“Guarantor Security
Agreement” shall mean any security agreement executed
by any Guarantor in favor of Agent securing the Obligations or the
Guaranty of such Guarantor, in form and substance reasonably
satisfactory to Agent.

 

“Guaranty” shall mean any
guaranty of the Obligations executed by a Guarantor in favor of
Agent for its benefit and for the ratable benefit of Lenders, in
form and substance satisfactory to Agent, including Article XVII
hereof.

 

“Guatemalan Subsidiary”
shall mean AW GUA, Limitada, a sociedad de responsabilidad limitada
formed under the laws of Guatemala.

 

“Hazardous Discharge”
shall have the meaning set forth in Section 9.3(b)
hereof.

 

“Hazardous Materials”
shall mean, without limitation, any flammable explosives, radon,
radioactive materials, asbestos, urea formaldehyde foam insulation,
polychlorinated biphenyls, petroleum and petroleum products,
methane, hazardous materials, Hazardous Wastes, hazardous or Toxic
Substances or related materials as defined in or subject to
regulation under Environmental Laws.

 

“Hazardous Wastes” shall
mean all waste materials subject to regulation under CERCLA, RCRA
or applicable state Law, and any other applicable Federal and state
Laws now in force or hereafter enacted relating to hazardous waste
disposal.

 

“Hedge Liabilities” shall
mean the Interest Rate Hedge Liabilities.

 

 

 

-14-

 

 

“Indebtedness” shall mean,
as to any Person at any time, any and all indebtedness, obligations
or liabilities (whether matured or unmatured, liquidated or
unliquidated, direct or indirect, absolute or contingent, or joint
or several) of such Person for or in respect of: (a) borrowed
money; (b) amounts received under or liabilities in respect of
any note purchase or acceptance credit facility, and all
obligations of such Person evidenced by bonds, debentures, notes or
other similar instruments; (c) all Capitalized Lease Obligations;
(d) reimbursement obligations (contingent or otherwise) under
any letter of credit agreement, banker’s acceptance agreement
or similar arrangement; (e) obligations under any Interest
Rate Hedge or other interest rate management device, foreign
currency exchange agreement, currency swap agreement, commodity
price protection agreement or other interest or currency exchange
rate or commodity price hedging arrangement; (f) any other
advances of credit made to or on behalf of such Person or other
transaction (including forward sale or purchase agreements,
capitalized leases and conditional sales agreements) having the
commercial effect of a borrowing of money entered into by such
Person to finance its operations or capital requirements including
to finance the purchase price of property or services and all
obligations of such Person to pay the deferred purchase price of
property or services (but not including trade payables and accrued
expenses incurred in the Ordinary Course of Business which are not
represented by a promissory note or other evidence of
indebtedness); (g) all Equity Interests of such Person subject to
repurchase or redemption rights or obligations (excluding
repurchases or redemptions at the sole option of such Person);
(h) all indebtedness, obligations or liabilities secured by a
Lien on any asset of such Person, whether or not such indebtedness,
obligations or liabilities are otherwise an obligation of such
Person; (i) all obligations of such Person for
“earnouts”, purchase price adjustments, profit sharing
arrangements, deferred purchase money amounts and similar payment
obligations or continuing obligations of any nature of such Person
arising out of purchase and sale contracts; (j) off-balance sheet
liabilities and/or pension plan liabilities of such Person;
(k) obligations arising under bonus, deferred compensation,
incentive compensation or similar arrangements, other than those
arising in the Ordinary Course of Business; and (l) any
guaranty of any indebtedness, obligations or liabilities of a type
described in the foregoing clauses (a) through
(k).

 

“Indemnified Taxes” shall
mean (a) Taxes other than Excluded Taxes, imposed on or with
respect to any payment made by or on account of any obligation of
any Loan Party under this Agreement or any Other Document, and (b)
to the extent not otherwise described in the foregoing clause (a),
Other Taxes.

 

“Ineligible Security”
shall mean any security which may not be underwritten or dealt in
by member banks of the Federal Reserve System under Section 16 of
the Banking Act of 1933 (12 U.S.C. Section 24, Seventh), as
amended.

 

“Insolvency Event” shall
mean, with respect to any Person, including without limitation any
Lender, such Person or such Person’s direct or indirect
Parent (a) becomes the subject of a bankruptcy or insolvency
proceeding (including any proceeding under Title 11 of the United
States Code), or regulatory restrictions, (b) has had a receiver,
conservator, trustee, administrator, custodian, assignee for the
benefit of creditors or similar Person charged with the
reorganization or liquidation of its business appointed for it or
has called a meeting of its creditors, (c) admits in writing its
inability, or is generally unable, to pay its debts as they become
due or ceases operations of its present business, (d) with respect
to a Lender, such Lender is unable to perform hereunder due to the
application of Applicable Law, or (e) in the good faith
determination of Agent, has taken any action in furtherance of, or
indicating its consent to, approval of, or acquiescence in, any
such proceeding or appointment of a type described in clauses (a)
or (b), provided that an Insolvency Event shall not result solely
by virtue of any ownership interest, or the acquisition of any
ownership interest, in such Person or such Person’s direct or
indirect Parent by a Governmental Body or instrumentality thereof
if, and only if, such ownership interest does not result in or
provide such Person with immunity from the jurisdiction of courts
within the United States or from the enforcement of judgments or
writs of attachment on its assets or permit such Person (or such
Governmental Body or instrumentality) to reject, repudiate, disavow
or disaffirm any contracts or agreements made by such
Person.

 

 

 

-15-

 

 

“Intellectual Property”
shall mean property constituting a patent, copyright, trademark (or
any application in respect of the foregoing), service mark, trade
name, mask work, trade secrets, design right, assumed name or
license or other right to use any of the foregoing under Applicable
Law.

 

“Interest Expense” shall
mean, for any Person for any period, the aggregate interest expense
of such Person for such period, determined in accordance with
GAAP.

 

“Interest Period” shall
mean the period provided for any LIBOR Rate Loan pursuant to
Section 2.2(b) hereof.

 

“Interest Rate Hedge”
shall mean an interest rate exchange, collar, cap, swap, floor,
adjustable strike cap, adjustable strike corridor, cross-currency
swap or similar agreements entered into by any Borrower, Guarantor
and/or their respective Subsidiaries in order to provide protection
to, or minimize the impact upon, such Borrower, any Guarantor
and/or their respective Subsidiaries of increasing floating rates
of interest applicable to Indebtedness.

 

“Interest Rate Hedge
Liabilities” shall mean the liabilities owing to the
provider of any Interest Rate Hedge. For purposes of this Agreement
and all of the Other Documents, all Interest Rate Hedge Liabilities
of any Loan Party or Subsidiary that is party to any
Lender-Provided Interest Rate Hedge shall be
“Obligations” hereunder and under the Other Documents,
except to the extent constituting Excluded Hedge Liabilities of
such Person, and the Liens securing such Interest Rate Hedge
Liabilities shall be pari passu with the Liens securing
all other Obligations under this Agreement and the Other Documents,
subject to the express provisions of Section 11.5
hereof.

 

 “Inventory”
shall mean and include as to each Loan Party all of such Loan
Party’s inventory (as defined in Article 9 of the Uniform
Commercial Code) and all of such Loan Party’s goods,
merchandise and other personal property, wherever located, to be
furnished under any consignment arrangement, contract of service or
held for sale or lease, all raw materials, work in process,
finished goods and materials and supplies of any kind, nature or
description which are or might be used or consumed in such Loan
Party’s business or used in selling or furnishing such goods,
merchandise and other personal property, and all
Documents.

 

“Investment Property”
shall mean and include, with respect to any Person, all of such
Person’s now owned or hereafter acquired securities (whether
certificated or uncertificated), securities entitlements,
securities accounts, commodities contracts and commodities
accounts, and any other asset or right that would constitute
“investment property” under the Uniform Commercial
Code.

 

“Issuer” shall mean (a)
Agent in its capacity as the issuer of Letters of Credit under this
Agreement and (b) any other Lender which Agent in its discretion
shall designate as the issuer of and cause to issue any particular
Letter of Credit under this Agreement in place of Agent as
issuer.

 

“Law(s)” shall mean any
law(s) (including common law), constitution, statute, treaty,
regulation, rule, ordinance, binding opinion, release, ruling,
order, executive order, injunction, writ, decree, bond, judgment,
authorization or approval, lien or award of or any settlement
arrangement, by agreement, consent or otherwise, with any
Governmental Body, foreign or domestic.

 

“Leasehold Interests”
shall mean all of each Loan Party’s right, title and interest
in and to, and as lessee of, the premises identified as leased Real
Property on the Disclosure Schedule.

 

 

 

-16-

 

 

“Lender” and
“Lenders” shall have the
meaning ascribed to such term in the preamble to this Agreement and
shall include each Person which becomes a permitted transferee,
successor or assign of any Lender. For the purposes of any
provision of this Agreement or any Other Document which provides
for the granting of a security interest or other Lien to Agent for
the benefit of Lenders as security for the Obligations,
“Lenders" shall include any Affiliate of a Lender to which
such Obligation (specifically including any Hedge Liabilities and
any Cash Management Liabilities) is owed.

 

“Lender-Provided Interest Rate
Hedge” shall mean an Interest Rate Hedge which is
provided by any Lender and with respect to which such Lender
confirms to Agent in writing prior to the execution thereof that
it: (a) is documented in a standard International Swap Dealers
Association, Inc. Master Agreement or another reasonable and
customary manner; (b) provides for the method of calculating the
reimbursable amount of the provider’s credit exposure in a
reasonable and customary manner; and (c) is entered into for
hedging (rather than speculative) purposes.

 

“Letter of Credit
Application” shall have the meaning set forth in
Section 2.12(a) hereof.

 

“Letter of Credit
Borrowing” shall have the meaning set forth in Section
2.14(d) hereof.

 

“Letter of Credit Fees”
shall have the meaning set forth in Section 3.2
hereof.

 

“Letter of Credit
Sublimit” shall mean $5,000,000.

 

“Letters of Credit” shall
have the meaning set forth in Section 2.11 hereof.

 

“LIBOR Alternate Source”
shall have the meaning set forth in the definition of “LIBOR
Rate”.

 

“LIBOR Rate” shall mean
for any LIBOR Rate Loan for the then current Interest Period
relating thereto, the interest rate per annum determined by Agent
by dividing (the resulting quotient rounded upwards, if necessary,
to the nearest 1/100th of 1% per annum) (a) the rate which appears
on the Bloomberg Page BBAM1 (or on such other substitute Bloomberg
page that displays rates at which U.S. dollar deposits are offered
by leading banks in the London interbank deposit market), or the
rate which is quoted by another source selected by Agent as an
authorized information vendor for the purpose of displaying rates
at which U.S. dollar deposits are offered by leading banks in the
London interbank deposit market (a “LIBOR Alternate
Source”), at approximately 11:00 a.m., London time, two (2)
Business Days prior to the commencement of such Interest Period as
the London interbank offered rate for U.S. Dollars for an amount
comparable to such LIBOR Rate Loan and having a borrowing date and
a maturity comparable to such Interest Period (or (x) if there
shall at any time, for any reason, no longer exist a Bloomberg Page
BBAM1 (or any substitute page) or any LIBOR Alternate Source, a
comparable replacement rate determined by Agent at such time (which
determination shall be conclusive absent manifest error) or (y) if
the LIBOR Rate is unascertainable as set forth in Section 3.8.2(i)
hereof, a comparable replacement rate determined in accordance with
Section 3.8.2 hereof), by (b) a number equal to 1.00 minus the Reserve Percentage;
provided,
however, that if
the LIBOR Rate determined as provided above would be less than
zero, such rate shall be deemed to be zero for purposes of this
Agreement. The LIBOR Rate shall be adjusted with respect to any
LIBOR Rate Loan that is outstanding on the effective date of any
change in the Reserve Percentage as of such effective date. Agent
shall give reasonably prompt notice to Borrowing Agent of the LIBOR
Rate as determined or adjusted in accordance herewith, which
determination shall be conclusive absent manifest
error.

 

“LIBOR Rate Loan” shall
mean any Advance that bears interest based on the LIBOR
Rate.

 

“LIBOR Termination Date”
shall have the meaning set forth in Section 3.8.2(a)
hereof.

 

 

 

-17-

 

 

“License Agreement” shall
mean any agreement between any Loan Party and a Licensor pursuant
to which such Loan Party is authorized to use any Intellectual
Property in connection with the manufacturing, marketing, sale or
other distribution of any Inventory of such Loan Party or otherwise
in connection with such Loan Party’s business
operations.

 

“Licensor” shall mean any
Person from whom any Loan Party obtains the right to use (whether
on an exclusive or non-exclusive basis) any Intellectual Property
in connection with such Loan Party’s manufacture, marketing,
sale or other distribution of any Inventory or otherwise in
connection with such Loan Party’s business
operations.

 

“Licensor/Agent Agreement”
shall mean an agreement between Agent and a Licensor, in form and
substance satisfactory to Agent, by which Agent is given the
unqualified right, vis-à-vis such Licensor, to enforce
Agent’s Liens with respect to and to dispose of any Loan
Party’s Inventory with the benefit of any Intellectual
Property applicable thereto, irrespective of such Loan
Party’s default under any License Agreement with such
Licensor.

 

“Lien” shall mean any
mortgage, deed of trust, pledge, hypothecation, assignment,
security interest, lien (whether statutory or otherwise),
encumbrance, preference, priority or other security agreement or
preferential arrangement held or asserted in respect of any asset
of any kind or nature whatsoever including any conditional sale or
other title retention agreement, the interest of a lessor under any
capital lease (or financing lease having substantially the same
economic effect as any of the foregoing), and the filing of, or
agreement to give, any financing statement under the Uniform
Commercial Code or comparable law of any jurisdiction.

 

“Lien Waiver Agreement”
shall mean an agreement in form and substance reasonably
satisfactory to Agent which is executed in favor of Agent by a
Person who owns or occupies premises at which any Collateral may be
located from time to time.

 

“Loan Party” or
“Loan
Parties” shall have the meaning set forth in the
preamble to this Agreement and shall extend to all permitted
successors and assigns of such Persons.

 

“Material Adverse Effect”
shall mean a material adverse effect on (a) the condition
(financial or otherwise), results of operations, assets, business
or properties of the Loan Parties, taken as a whole, (b) any Loan
Party’s ability to duly and punctually pay or perform the
Obligations in accordance with the terms hereof or (c)
Agent’s and each Lender’s rights, remedies and benefits
under this Agreement and the Other Documents.

 

“Material Contract” shall
mean any contract, agreement, instrument, permit, lease or license,
written or oral, of any Loan Party, the termination of which could
reasonably be expected to result in a Material Adverse
Effect.

 

“Maximum Revolving Advance
Amount” shall mean $25,000,000.

 

“Maximum Swing Loan Advance
Amount” shall mean $0.

 

“Maximum Undrawn Amount”
shall mean, with respect to any outstanding Letter of Credit as of
any date, the amount of such Letter of Credit that is or may become
available to be drawn, including all automatic increases provided
for in such Letter of Credit, whether or not any such automatic
increase has become effective.

 

“Modified Commitment Transfer
Supplement” shall have the meaning set forth in
Section 16.3(d) hereof.

 

“Multiemployer Plan” shall
mean a “multiemployer plan” as defined in Section 3(37)
or 4001(a)(3) of ERISA to which contributions are required or,
within the preceding five plan years, were required by any Loan
Party or any member of the Controlled Group.

 

“Multiple Employer Plan”
shall mean a Plan which has two or more contributing sponsors
(including any Loan Party or any member of the Controlled Group) at
least two of whom are not under common control, as such a plan is
described in Section 4063 or 4064 of ERISA.

 

 

 

-18-

 

 

“Net Cash Proceeds” shall
mean: (a) with respect to any Disposition of Collateral (other than
Equity Interests), by any Loan Party or any of its Subsidiaries,
the aggregate cash proceeds (including cash proceeds received
pursuant to policies of insurance and by way of deferred payment of
principal pursuant to a note, installment receivable or otherwise,
but only as and when received) received by such Loan Party or
Subsidiary pursuant to such Disposition net of (i) the
reasonable direct costs related to such Disposition (including
sales commissions and legal, accounting and investment banking
fees, commissions and expenses), (ii) any portion of such proceeds
deposited in an escrow account pursuant to the documents relating
to such Disposition (provided that such amounts shall be treated as
Net Cash Proceeds upon their release from such escrow account to
any Loan Party), (iii) Taxes paid or reasonably estimated by any
Loan Party to be payable as a result thereof (after taking into
account any available tax credits or deductions and any tax sharing
arrangements), and (iv) amounts required to be applied to the
repayment of any Indebtedness secured by a Permitted Encumbrance
prior to the Lien of Agent on the asset subject to such
Disposition, all of the costs and expenses reasonably incurred in
connection with the collection of such proceeds, award or other
payments, and any amounts retained by or paid to parties having
superior rights to such proceeds, awards or other payments; and (b)
with respect to the Disposition of Equity Interests or the
incurrence or issuance of any Indebtedness by any Loan Party or any
of its Subsidiaries, the excess of (i) the sum of the cash and Cash
Equivalents received by such Loan Party or Subsidiary in connection
with such transaction over (ii) the underwriting discounts and
commissions, and other reasonable and customary out-of-pocket
expenses, incurred by such Loan Party or Subsidiary in connection
therewith.

 

“Non-Defaulting Lender”
shall mean, at any time, any Revolving Lender that is not a
Defaulting Lender at such time.

 

“Non-Qualifying Party”
shall mean any Loan Party that on the Eligibility Date fails for
any reason to qualify as an Eligible Contract
Participant.

 

“Notes” shall mean
collectively the Revolving Credit Note and the Swing Loan
Note.

 

“Obligations” shall mean
and include any and all Advances and Swing Loans and all loans,
advances, debts, liabilities, obligations (including without
limitation all reimbursement obligations and cash collateralization
obligations with respect to Letters of Credit issued hereunder),
covenants and duties owing by any Loan Party to Issuers, Swing Loan
Lender, Lenders or Agent (or to any other direct or indirect
subsidiary or affiliate of any Issuer, Swing Loan Lender, any
Lender or Agent) of any kind or nature, present or future
(including any interest or other amounts accruing thereon, any fees
accruing under or in connection therewith, any costs and expenses
of any Person payable by any Loan Party in connection therewith and
any indemnification obligations payable by any Loan Party arising
or payable after maturity thereof, or after the filing of any
petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding relating to any Loan Party,
whether or not a claim for post-filing or post-petition interest,
fees or other amounts is allowable or allowed in such proceeding),
arising under this Agreement, the Other Documents, Lender-Provided
Interest Rate Hedges and any Cash Management Products and Services,
whether direct or indirect, absolute or contingent, joint or
several, due or to become due, now existing or hereafter arising,
contractual or tortious, liquidated or unliquidated, including, (i)
any and all of any Loan Party’s Indebtedness under this
Agreement or the Other Documents, (ii) all Hedge Liabilities and
(iii) all Cash Management Liabilities. Notwithstanding anything to
the contrary contained in the foregoing, the Obligations shall not
include any Excluded Hedge Liabilities.

 

“Ordinary Course of
Business” shall mean, with respect to any Loan Party,
the ordinary course of such Loan Party’s business as
conducted on the Closing Date or as permitted by Section 7.9
hereof.

 

 

 

-19-

 

 

“Organizational Documents”
shall mean, with respect to any Person, any charter, articles or
certificate of incorporation, certificate of organization,
registration or formation, certificate of partnership or limited
partnership, bylaws, operating agreement, limited liability company
agreement, or partnership agreement of such Person and any and all
other applicable documents relating to such Person’s
formation, organization or entity governance matters (including any
shareholders’ or equity holders’ agreement or voting
trust agreement) and specifically includes, without limitation, any
certificates of designation for preferred stock or other forms of
preferred equity.

 

“Other Documents” shall
mean the Notes, the Fee Letter, the Pledged Cash Agreement, any
Guaranty, any Guarantor Security Agreement, any Pledge Agreement,
the Disclosure Schedule, any agreement providing a Lender-Provided
Interest Rate Hedge, any agreement with respect to Cash Management
Products and Services, and any and all other agreements,
instruments and documents, including intercreditor agreements,
guaranties, pledges, powers of attorney, consents, interest or
currency swap agreements or other similar agreements and all other
agreements, documents or instruments heretofore, now or hereafter
executed by any Loan Party and/or delivered to Agent or any Lender
in respect of the transactions contemplated by this Agreement, in
each case together with all amendments, modifications, supplements,
renewals, extensions, restatements, substitutions and replacements
thereto and thereof.

 

“Other Taxes” shall mean
all present or future stamp, court or documentary, intangible,
recording, filing, other excise or property Taxes or similar Taxes,
charges or similar levies that arise from any payment made under,
from the execution, delivery, performance, enforcement or
registration of, from the receipt or perfection of a security
interest under, or otherwise with respect to, this Agreement or any
Other Document.

 

“Out-of-Formula Loans”
shall have the meaning set forth in Section 16.2(d)
hereof.

 

“Overnight Bank Funding
Rate” shall mean, for any, day the rate per annum
(based on a year of 360 days and actual days elapsed) comprised of
both overnight federal funds and overnight Eurocurrency borrowings
by U.S.-managed banking offices of depository institutions, as such
composite rate shall be determined by the Federal Reserve Bank of
New York, as set forth on its public website from time to time, and
as published on the next succeeding Business Day as the overnight
bank funding rate by such Federal Reserve Bank (or by such other
recognized electronic source (such as Bloomberg) selected by Agent
for the purpose of displaying such rate) (an “Alternate
Source”); provided, that if such day is not a Business Day,
the Overnight Bank Funding Rate for such day shall be such rate on
the immediately preceding Business Day; provided, further, that if
such rate shall at any time, for any reason, no longer exist, a
comparable replacement rate determined by Agent at such time (which
determination shall be conclusive absent manifest error). If the
Overnight Bank Funding Rate determined as set forth above would be
less than zero, then such rate shall be deemed to be zero. The rate
of interest charged shall be adjusted as of each Business Day based
on changes in the Overnight Bank Funding Rate without notice to the
Borrowers.

 

“Parent” of any Person
shall mean a corporation or other entity owning, directly or
indirectly, more than fifty percent (50%) of the Equity Interests
issued by such Person having ordinary voting power to elect a
majority of the directors of such Person, or other Persons
performing similar functions for any such Person.

 

“Participant” shall mean
each Person who shall be granted the right by any Lender to
participate in any of the Advances and who shall have entered into
a participation agreement in form and substance satisfactory to
such Lender.

 

“Participation Advance”
shall have the meaning set forth in Section 2.14(d)
hereof.

 

 

 

-20-

 

 

“Participation Commitment”
shall mean the obligation hereunder of each Revolving Lender to buy
a participation equal to its Revolving Commitment Percentage
(subject to any reallocation pursuant to Section 2.22(b)(iii)
hereof) in the Swing Loans made by Swing Loan Lender hereunder as
provided for in Section 2.4(c) hereof and in the Letters of Credit
issued hereunder as provided for in Section 2.14(a)
hereof.

 

“Payment Conditions” shall
mean, with respect to any proposed Permitted Acquisition and any
proposed investment under clauses (b)(i) and (b)(ii) of the
definition of “Permitted Investments” that, at the time
of and after giving effect to such transaction (and to any Advances
being requested and/or other Indebtedness being incurred or assumed
to fund any portion of such transaction): (a) the Borrowers and
their Subsidiaries shall have maintained minimum EBITDA of at least
$10,000,000 when measured for one of the following periods: (i) the
6-month period ending December 31, 2019, (ii) the 9-month period
ending March 31, 2020, (iii) the 12-month period ending June 30,
2020 or (iv) any 12-month period as of the end of any quarter
ending thereafter, as demonstrated by a Compliance Certificate
delivered in accordance with Section 9.8 hereof; (b) the Borrowers
shall have Undrawn Availability of not less than $7,500,000; (c)
the Loan Parties shall have delivered to Agent (i) a pro forma
balance sheet, pro forma financial statements and a Compliance
Certificate demonstrating that, upon giving effect to such
transaction on a pro forma basis, the Borrowers and their
Subsidiaries are in compliance with the financial covenant set
forth in Section 6.5 hereof for the most recently completed period
of four (4) consecutive fiscal quarters, or other applicable period
as set forth in Section 6.5, for which the financial statements and
Compliance Certificate required by Section 9.8 hereof, have
been or were required to have been delivered; and (d) no Default or
Event of Default shall have occurred or will occur after giving pro
forma effect to such transaction. For the purposes of calculating
Undrawn Availability under this definition, any assets being
acquired in any proposed Permitted Acquisitions shall be included
in the Formula Amount on the date of closing of any such
acquisition so long as Agent has received an audit or appraisal of
such assets as set forth in clause (i) of the definition of
“Permitted Acquisitions” and so long as such assets
satisfy the applicable eligibility criteria.

 

“Payment in Full” or
“Paid in
Full” shall mean, with respect to the Obligations, the
payment and satisfaction in full of all of the Obligations (other
than contingent indemnification liabilities for which a claim has
not been made) in cash or in other immediately available funds;
provided that
(a) in the case of any Obligations with respect to outstanding
Letters of Credit, in lieu of the payment in full in cash, the
delivery of cash collateral or a backstop letter of credit in form
and substance reasonably satisfactory to the applicable Issuer in
an amount equal to 105% of the Maximum Undrawn Amount of all
outstanding Letters of Credit shall constitute Payment in Full of
such Obligations and (b) in the case of any Obligations with
respect to Cash Management Products and Services and any
Lender-Provided Interest Rate Hedges in lieu of the payment in full
in cash, the delivery of cash collateral in such amounts as shall
be required by the applicable Lender or other arrangements in form
and substance reasonably satisfactory to such Lender in respect
thereof shall constitute Payment in Full of such Obligations.
Notwithstanding the foregoing, in the event that, after receipt of
any payment of, or proceeds of Collateral applied to the payment
of, any of the Obligations, Agent or any Lender is required to
surrender or return such payment or proceeds to any Person for any
reason, then the Obligations intended to be satisfied by such
payment or proceeds shall be reinstated and continue as if such
payment or proceeds had not been received by Agent or such
Lender.

 

“Payment Office” shall
mean initially Two Tower Center Boulevard, East Brunswick, New
Jersey 08816; thereafter, such other office of Agent, if any, which
it may designate by notice to Borrowing Agent and to each Lender to
be the Payment Office.

 

“PBGC” shall mean the
Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA or any successor.

 

 

 

-21-

 

 

“Pension Benefit Plan”
shall mean at any time any “employee pension benefit
plan” as defined in Section 3(2) of ERISA (including a
Multiple Employer Plan, but not a Multiemployer Plan) which is
covered by Title IV of ERISA or is subject to the minimum funding
standards under Section 412, 430 or 436 of the Code and either (i)
is maintained or to which contributions are required by any Loan
Party or any member of the Controlled Group or (ii) has at any time
within the preceding five years been maintained or to which
contributions have been required by a Loan Party or any entity
which was at such time a member of the Controlled
Group.

 

“Permitted Acquisitions”
shall mean acquisitions of the assets or Equity Interests of
another Person (the “Target”) so long as: (a) at the
time of any such acquisition, the Payment Conditions are satisfied;
(b) the total costs and liabilities (including without limitation,
all assumed liabilities, all earn-out payments, deferred payments
and the value of any other stock or assets transferred, assigned or
encumbered with respect to such acquisitions) of all such
acquisitions do not exceed (i) $5,000,000 in the aggregate in any
fiscal year and (ii) $10,000,000 in the aggregate during the Term;
(c) with respect to the acquisition of Equity Interests, the Target
shall (i) have a positive EBITDA, calculated in accordance with
GAAP immediately prior to such acquisition, (ii) be added as a
Borrower or a Guarantor (as Agent shall determine in its Permitted
Discretion) and be jointly and severally liable for all
Obligations, and (iii) grant to Agent a first priority Lien
(subject to Permitted Encumbrances) in all assets of the Target;
(d) the Target or assets acquired are used or useful in the
Borrowers’ Ordinary Course of Business; (e) Agent shall have
received a first priority Lien in all acquired assets or Equity
Interests which do not constitute Excluded Property, subject to
documentation reasonably satisfactory to Agent; (f) the board of
directors (or other comparable governing body) of the Target shall
have duly approved the acquisition; (g) the Loan Parties shall have
delivered to Agent financial statements of the acquired entity
for the two (2) most recent fiscal years then ended, in form and
substance reasonably acceptable to Agent; (h) if such acquisition
includes general partnership interests or any other Equity Interest
that does not have a corporate (or similar) limitation on liability
of the owners thereof, then such acquisition shall be effected by
having such Equity Interests acquired by a corporate holding
company directly or indirectly wholly-owned by a Loan Party and
newly formed for the sole purpose of effecting such acquisition;
and (i) no assets acquired in any such acquisition shall be
included in the Formula Amount until Agent has received a field
examination and/or appraisal of such assets, in form and substance
acceptable to Agent.

 

“Permitted Affiliate
Transactions” shall mean (a) any indemnity provided
for the benefit of directors (or comparable managers) of such Loan
Party, so long as such indemnity has been approved by the board of
directors of such Loan Party accordance with applicable law, (b)
the payment of reasonable compensation, severance or employee
benefit arrangements to employees, officers and outside directors
of such Loan Party in the Ordinary Course of Business and
consistent with industry practice, so long as such payment has been
approved by the board of directors of such Loan Party in accordance
with applicable law, (c) transactions contemplated by the Services
Agreement dated as of June 1, 2016, by and between the Guatemalan
Subsidiary and Autobytel, (d) transactions contemplated by the
Office Services Contract, as amended, dated as of June 1, 2016, by
and between the Guatemalan Subsidiary and Soluciones AW, S.A. and
(e) Permitted Indebtedness, Permitted Investments, Permitted Loans
and transactions permitted by Section 7.1 hereof; provided,
however, that the foregoing transactions permitted under this
clause (e) as between the Loan Parties, or any of them, and the
Guatemalan Subsidiary shall be limited to the transactions
permitted under clause (g) of the definition of Permitted
Indebtedness, clauses (a)(iv)(A) and (a)(v)(B) of the definition of
Permitted Investments, clause (d)(ii) of the definition of
Permitted Loans and clause (b)(viii)(B) of Section 7.1
hereof.

 

“Permitted Assignees”
shall mean: (a) Agent, any Lender or any of their direct or
indirect Affiliates; (b) if an Event of Default has occurred and is
continuing, a federal or state chartered bank, a United States
branch of a foreign bank, an insurance company, or any finance
company generally engaged in the business of making commercial
loans; (c) any fund that is administered or managed by Agent or any
Lender, an Affiliate of Agent or any Lender or a related entity;
and (d) any Person to whom Agent or any Lender assigns its rights
and obligations under this Agreement as part of an assignment and
transfer of such Agent’s or Lender’s rights in and to a
material portion of such Agent’s or Lender’s portfolio
of asset-based credit facilities.

 

 

 

-22-

 

 

“Permitted Discretion”
shall mean a determination made in good faith and in the exercise
(from the perspective of a secured asset-based lender) of
commercially reasonable business judgment.

 

“Permitted Encumbrances”
shall mean: (a) Liens in favor of Agent for the benefit of the
Secured Parties, including without limitation, Liens securing Hedge
Liabilities and Cash Management Products and Services; (b) Liens
for taxes, assessments or other governmental charges not delinquent
or being Properly Contested; (c) deposits or pledges to secure
obligations under worker’s compensation, social security or
similar laws, or under unemployment insurance; (d) deposits or
pledges to secure bids, tenders, contracts (other than contracts
for the payment of money), leases, statutory obligations, surety
and appeal bonds and other obligations of like nature arising in
the Ordinary Course of Business; (e) Liens arising by virtue of the
rendition, entry or issuance against any Loan Party or any
Subsidiary, or any property of any Loan Party or any Subsidiary, of
any judgment, writ, order, or decree to the extent the rendition,
entry, issuance or continued existence of such judgment, writ,
order or decree (or any event or circumstance relating thereto) has
not resulted in the occurrence of an Event of Default under Section
10.6 hereof; (f) carriers’, repairmens’,
mechanics’, workers’, materialmen’s or other like
Liens arising in the Ordinary Course of Business with respect to
obligations which are not due or which are being Properly
Contested; (g) Liens upon fixed assets hereafter acquired to secure
a portion of the purchase price thereof, provided that (i) any such
lien shall not encumber any other property of any Loan Party and
(ii) the aggregate amount of Indebtedness secured by such Liens
incurred as a result of such purchases during any fiscal year shall
not exceed the amount permitted in Section 7.6 hereof; (h)
other Liens incidental to the conduct of any Loan Party’s
business or the ownership of its property and assets which were not
incurred in connection with the borrowing of money or the obtaining
of advances or credit, and which do not in the aggregate materially
detract from Agent’s or Lenders’ rights in and to the
Collateral or the value of any Loan Party’s property or
assets or which do not materially impair the use thereof in the
operation of any Loan Party’s business; (i) easements,
rights-of-way, zoning restrictions, minor defects or irregularities
in title and other charges or encumbrances, in each case, which do
not interfere in any material respect with the Ordinary Course of
Business of the Loan Parties; (j) Liens (i) of a collecting bank
arising under applicable law on items in the course of collection,
and (ii) in favor of a banking institution arising as a matter of
law encumbering deposits (including the right of setoff) that are
customary in the banking industry; (k) any interest or title of a
lessor, sublessor, licensor or sublicensor under leases or licenses
permitted by this Agreement that are entered into in the Ordinary
Course of Business; (l) leases, licenses, subleases or sublicenses
granted to others in the Ordinary Course of Business that do not
(i) interfere in any material respect with the ordinary conduct of
the business of Loan Parties, or (ii) secure any Indebtedness; and
(m) Liens existing on the Closing Date and listed on the Disclosure
Schedule; provided
that such Liens
shall secure only those obligations which they secure on the
Closing Date (and extensions, renewals and refinancing of such
obligations permitted by Section 7.8 hereof) and shall not
subsequently apply to any other property or assets of any Loan
Party other than the property and assets to which they apply as of
the Closing Date.

 

“Permitted Indebtedness”
shall mean: (a) the Obligations; (b) Indebtedness incurred for
Capital Expenditures permitted in Section 7.6 hereof or Leases
permitted by Section 7.11 hereof; (c) any guarantees of
Indebtedness permitted under Section 7.3 hereof; (d) any
Indebtedness on the Closing Date listed on the Disclosure Schedule
and any refinancings, refundings, renewals or extensions thereof;
provided that the amount of such Indebtedness is not increased at
the time of such refinancing, refunding, renewal or extension
except by an amount equal to a reasonable premium or other
reasonable amount paid, and fees and expenses reasonably incurred,
in connection with such refinancing and by an amount equal to any
existing commitments unutilized thereunder; (e) Interest Rate
Hedges that are not prohibited by this Agreement;
(f) Indebtedness arising from Permitted Loans; (g)
Indebtedness owing to a Subsidiary of a Loan Party that is not a
Loan Party in an amount not to exceed $300,000 outstanding at any
time; (h) Indebtedness in respect of performance bonds, bid bonds,
appeal bonds, surety bonds and completion guarantees and similar
obligations not in connection with money borrowed, in each case
provided in the Ordinary Course of Business, including those
incurred to secure health, safety and environmental obligations in
the ordinary course of business; and (i) Indebtedness (i) resulting
from a bank or other financial institution honoring a check, draft
or similar instrument in the ordinary course of business or (ii)
arising under or in connection with cash management services in the
ordinary course of business.

 

 

 

-23-

 

 

“Permitted Investments”
shall mean investments in: (a) (i) Cash Equivalents; (ii) Permitted
Acquisitions; (iii) Permitted Loans; (iv) (A) investments in
Subsidiaries in existence on the Closing Date, and (B) other
investments in existence on the Closing Date and identified on the
Disclosure Schedule, and any refinancing, refunding, renewal or
extension of any such investment that does not increase the amount
thereof; (v) investments (A) in a Loan Party and (B) in a
Subsidiary of a Loan Party that is not a Loan Party in an amount
not to exceed, when taken together with Permitted Loans under
clause (d)(ii) of the definition thereof and permitted transfers of
assets under Section 7.1(b)(viii)(B), $300,000 in the aggregate
during the Term; (vi) investments received in satisfaction or
partial satisfaction thereof from financially troubled account
debtors to the extent reasonably necessary in order to prevent or
limit loss; (b) so long as the Payment Conditions are satisfied,
investments in a Person that is not a Subsidiary so long as the
total consideration for such investments (together with Permitted
Loans under clause (c) of the definition thereof), shall not exceed
$5,000,000 in the aggregate during the Term; and (c) other
investments not exceeding $100,000 during the Term.

 

“Permitted Loans” shall
mean: (a) the extension of trade credit by a Loan Party to its
Customers in the Ordinary Course of Business in connection with a
sale of Inventory or rendition of services, in each case on open
account terms, (b) advances to officers, directors and employees of
Loan Parties in an aggregate amount not exceeding $300,000 at any
time outstanding, for travel, entertainment, relocation and similar
ordinary business purposes, (c) so long as the Payment Conditions
are satisfied, the purchase of convertible notes in a Person that
is not a Subsidiary so long as the total consideration for such
convertible notes (together with Permitted Investments under clause
(b) of the definition thereof) shall not exceed $5,000,000 in the
aggregate during the Term and (d) intercompany loans (i) to a Loan
Party and (ii) to a Subsidiary of a Loan Party that is not a Loan
Party in an amount not to exceed, when taken together with
Permitted Investments under clause (a)(v)(B) of the definition
thereof and permitted transfers of assets under Section
7.1(b)(viii)(B), $300,000 outstanding at any time, so long as, in
each case, at the request of Agent, each such intercompany loan is
evidenced by a promissory note (including, if applicable, any
master intercompany note executed by the Loan Parties) on terms and
conditions (including terms subordinating payment of the
Indebtedness evidenced by such note to the prior Payment in Full of
all of the Obligations) reasonably acceptable to Agent in its sole
discretion that has been delivered to Agent either endorsed in
blank or together with an undated instrument of transfer executed
in blank by the applicable the Loan Parties that are the payees on
such note.

 

“Permitted Minority Investment
Dispositions” shall mean (a) the sale by AutoWeb of
the Equity Interests issued by GoMoto and/or (b) the sale by
AutoWeb of the Equity Interests issued by AdGreetz.

 

“Person” shall mean any
individual, sole proprietorship, partnership, corporation, business
trust, joint stock company, trust, unincorporated organization,
association, limited liability company, limited liability
partnership, institution, public benefit corporation, joint
venture, entity or Governmental Body (whether federal, state,
county, city, municipal or otherwise, including any
instrumentality, division, agency, body or department
thereof).

 

“Plan” shall mean any
employee benefit plan within the meaning of Section 3(3) of ERISA
(including a Pension Benefit Plan and a Multiemployer Plan, as
defined herein) maintained by any Loan Party or any member of the
Controlled Group or to which any Loan Party or any member of the
Controlled Group is required to contribute.

 

“Pledge Agreement” shall
mean that certain Collateral Pledge Agreement, dated as of the
Closing Date, by AutoWeb and Autobytel in favor of Agent, and any
other pledge agreements executed and delivered by any other Person
subsequent to the Closing Date to secure the
Obligations.

 

“Pledged Cash” shall mean
all cash pledged to Agent pursuant to the terms of the Pledge Cash
Agreement.

 

 

 

-24-

 

 

“Pledged Cash Agreement”
shall mean that certain Pledge Agreement (Bank Deposits) executed
by AutoWeb in favor of Agent dated as of the Closing
Date.

 

“PNC” shall have the
meaning set forth in the preamble to this Agreement and shall
extend to all of its successors and assigns.

 

“Pro Forma Balance Sheet”
shall have the meaning set forth in Section 5.5(a)
hereof.

 

“Pro Forma Financial
Statements” shall have the meaning set forth in
Section 5.5(b) hereof.

 

“Projections” shall have
the meaning set forth in Section 5.5(b) hereof.

 

“Properly Contested” shall
mean, in the case of any Indebtedness, Lien or Taxes, as
applicable, of any Person that are not paid as and when due or
payable by reason of such Person’s bona fide dispute
concerning its liability to pay the same or concerning the amount
thereof: (a) such Indebtedness, Lien or Taxes, as applicable,
are being properly contested in good faith by appropriate
proceedings promptly instituted and diligently conducted; (b) such
Person has established appropriate reserves as shall be required in
conformity with GAAP; (c) the non-payment of such Indebtedness or
Taxes will not have a Material Adverse Effect or will not result in
the forfeiture of any material assets of such Person; (d) no Lien
is imposed upon any of such Person’s assets with respect to
such Indebtedness or taxes unless enforcement of such Lien is
stayed during the period prior to the final resolution or
disposition of such dispute; and (e) if such Indebtedness or Lien,
as applicable, results from, or is determined by the entry,
rendition or issuance against a Person or any of its assets of a
judgment, writ, order or decree, enforcement of such judgment,
writ, order or decree is stayed pending a timely appeal or other
judicial review.

 

“Protective Advances”
shall have the meaning set forth in Section 16.2(e)
hereof.

 

“Published Rate” shall
mean the rate of interest published each Business Day in the Wall
Street Journal “Money Rates” listing under the caption
“London Interbank Offered Rates” for a one month period
(or, if no such rate is published therein for any reason, then the
Published Rate shall be the LIBOR Rate for a one month period as
published in another publication selected by Agent).

 

“Purchasing CLO” shall
have the meaning set forth in Section 16.3(d) hereof.

 

“Purchasing Lender” shall
have the meaning set forth in Section 16.3(c) hereof.

 

“Qualified ECP Loan Party”
shall mean each Loan Party that on the Eligibility Date is
(a) a corporation, partnership, proprietorship, organization,
trust, or other entity other than a “commodity pool” as
defined in Section 1a(10) of the CEA and CFTC regulations
thereunder that has total assets exceeding $10,000,000 or (b) an
Eligible Contract Participant that can cause another person to
qualify as an Eligible Contract Participant on the Eligibility Date
under Section 1a(18)(A)(v)(II) of the CEA by entering into or
otherwise providing a “letter of credit or keepwell, support,
or other agreement” for purposes of Section 1a(18)(A)(v)(II)
of the CEA.

 

“Quarterly Average
Borrowings” shall mean, for any period, the (i) sum of
the Usage Amount for each day during such period divided by (ii)
the number of days during such period.

 

“RCRA” shall mean the
Resource Conservation and Recovery Act, 42 U.S.C. §§ 6901
et seq., as same may be amended, modified or supplemented from time
to time.

 

“Real Property” shall mean
all of the real property owned, leased or operated by any Loan
Party on or after the Closing Date, together with, in each case,
all improvements and appurtenant fixtures, equipment, personal
property, easements and other property and rights incidental to the
ownership, lease or operation thereof.

 

 

 

-25-

 

 

“Receivables” shall mean
and include, as to each Loan Party, all of such Loan Party’s
accounts (as defined in Article 9 of the Uniform Commercial Code)
and all of such Loan Party’s contract rights, instruments
(including those evidencing indebtedness owed to such Loan Party by
its Affiliates), documents, chattel paper (including electronic
chattel paper), general intangibles relating to accounts, contract
rights, instruments, documents and chattel paper, all drafts and
acceptances, credit card receivables and all other forms of
obligations owing to such Loan Party arising out of or in
connection with the sale or lease of Inventory or the rendition of
services, all supporting obligations, guarantees and other security
therefor, whether secured or unsecured, now existing or hereafter
created, and whether or not specifically sold or assigned to Agent
hereunder.

 

“Register” shall have the
meaning set forth in Section 16.3(e) hereof.

 

“Reimbursement Obligation”
shall have the meaning set forth in Section 2.14(b)
hereof.

 

“Release” shall have the
meaning set forth in Section 5.7(c)(i) hereof.

 

“Reportable Compliance
Event” shall mean that any Covered Entity becomes a
Sanctioned Person, or is charged by indictment, criminal complaint
or similar charging instrument, arraigned, or custodially detained
in connection with any Anti-Terrorism Law or any predicate crime to
any Anti-Terrorism Law, or has knowledge of facts or circumstances
to the effect that it is reasonably likely that any aspect of its
operations is in actual or probable violation of any Anti-Terrorism
Law.

 

“Reportable ERISA Event”
shall mean a reportable event described in Section 4043 of ERISA or
the regulations promulgated thereunder, other than an event for
which the 30-day notice period is waived.

 

“Required Lenders” shall
mean Lenders (not including Swing Loan Lender (in its capacity as
such Swing Loan Lender) or any Defaulting Lender) holding more than
fifty percent (50%) of either (a) the aggregate of the Revolving
Commitment Amounts of all Lenders (excluding any Defaulting
Lender), or (b) after the termination of all of the Commitments,
the sum of the outstanding Revolving Advances and Swing Loans, plus
the Maximum Undrawn Amount of all outstanding Letters of Credit;
provided, however, if there are fewer than three (3) Lenders,
Required Lenders shall mean all Lenders (excluding any Defaulting
Lender).

 

“Reserves” shall mean, on
any date of determination, reserves established by Agent from time
to against the Maximum Revolving Advance Amount or the Formula
Amount in an amount equal to, without duplication, (a) the
aggregate amount of past due rent, fees or other charges owing at
such time by any Loan Party to any landlord of any premises where
any of such Loan Party’s books and records relating to the
Collateral are located, (b) if a Landlord Waiver Agreement is not
delivered in accordance with Section 7.19 hereof for a premises
where a Loan Party’s books and records relating to the
Collateral are located, an amount equal to no more than three
months of scheduled rent, fees or other charges for such premises,
(c) any amounts which any Loan Party is obligated to pay pursuant
to the provisions of this Agreement or any Other Document that
Agent elects to pay for the account of such Loan Party in
accordance with authority contained in this Agreement or any Other
Document but only to the extent that such payment has not been made
with a Revolving Advance or other extension of credit hereunder and
(d) other amounts pursuant to reserves Agent deems reasonably
proper and necessary in its Permitted Discretion pursuant to
Section 2.1(b) hereof.

 

“Reserve Percentage” shall
mean as of any day the maximum effective percentage in effect on
such day as prescribed by the Board of Governors of the Federal
Reserve System (or any successor) for determining the reserve
requirements (including supplemental, marginal and emergency
reserve requirements) with respect to eurocurrency funding
(currently referred to as “Eurocurrency
Liabilities”).

 

 

 

-26-

 

 

“Revolving Advances” shall
mean Advances other than Letters of Credit and the Swing
Loans.

 

“Revolving Commitment”
shall mean, as to any Lender, the obligation of such Lender (if
applicable), to make Revolving Advances and participate in Swing
Loans and Letters of Credit, in an aggregate principal and/or face
amount not to exceed the Revolving Commitment Amount (if any) of
such Lender.

 

“Revolving Commitment
Amount” shall mean as to any Lender, the amount of
such Lender’s Revolving Commitment, as such Revolving
Commitment may be increased or reduced from time to time pursuant
to Section 16.3(c) hereof. The Revolving Commitment Amount of the
Lenders as of the Closing Date is set forth opposite such
Lender’s name on Schedule 1.1 hereto.

 

“Revolving Commitment
Percentage” shall mean, as of any date of
determination with respect to any Lender, the ratio (expressed as a
percentage) of such Lender’s Revolving Commitment Amount on
such date to the Revolving Commitment Amounts of all Lenders on
such date.

 

“Revolving Credit Note”
shall mean, collectively, the promissory notes referred to in
Section 2.1(a) hereof.

 

“Revolving Interest Rate”
shall mean (a) with respect to Revolving Advances that are
Domestic Rate Loans and Swing Loans, an interest rate per
annum equal to the sum of the Applicable Margin for Domestic Rate
Loans and Swing Loans plus the Alternate Base
Rate and (b) with respect to Revolving Advances that are LIBOR
Rate Loans, an interest rate per annum equal to the sum of the
Applicable Margin for LIBOR Rate Loans plus the LIBOR
Rate.

 

“Revolving Lender” shall
mean each Lender holding a Revolving Commitment.

 

“Sanctioned Country” shall
mean a country subject to a sanctions program maintained under any
Anti-Terrorism Law.

 

“Sanctioned Person” shall
mean any individual person, group, regime, entity or thing listed
or otherwise recognized as a specially designated, prohibited,
sanctioned or debarred person, group, regime, entity or thing, or
subject to any limitations or prohibitions (including but not
limited to the blocking of property or rejection of transactions),
under any Anti-Terrorism Law.

 

“SEC” shall mean the
Securities and Exchange Commission or any successor
thereto.

 

“Secured Parties” shall
mean, collectively, Agent, Issuers, Swing Loan Lender and Lenders,
together with any Affiliates of Agent or any Lender to whom any
Hedge Liabilities or Cash Management Liabilities are owed and with
each other holder of any of the Obligations, and the respective
successors and assigns of each of them.

 

“Securities Act” shall
mean the Securities Act of 1933, as amended.

 

“Settlement” shall have
the meaning set forth in Section 2.6(d) hereof.

 

“Settlement Date” shall
have the meaning set forth in Section 2.6(d) hereof.

 

 “Subsidiary”
shall mean of any Person a corporation or other entity of whose
Equity Interests having ordinary voting power (other than Equity
Interests having such power only by reason of the happening of a
contingency) to elect a majority of the directors of such
corporation, or other Persons performing similar functions for such
entity, are owned, directly or indirectly, by such
Person.

 

 

 

-27-

 

 

“Subsidiary Stock” shall
mean (a) with respect to the Equity Interests issued to a Loan
Party by any Subsidiary (other than a Foreign Subsidiary), 100% of
such issued and outstanding Equity Interests, and (b) with respect
to any Equity Interests issued to a Loan Party by any Foreign
Subsidiary (i) 100% of such issued and outstanding Equity Interests
not entitled to vote (within the meaning of Treas. Reg. Section
1.956-2(c)(2)) and (ii) 65% (or such greater percentage that will
not cause any material adverse U.S. federal, state or local income
Tax consequences to a Loan Party) of such issued and outstanding
Equity Interests entitled to vote (within the meaning of Treas.
Reg. Section 1.956-2(c)(2)).

 

“Swap” shall mean any
“swap” as defined in Section 1a(47) of the CEA and
regulations thereunder other than (a) a swap entered into, or
subject to the rules of, a board of trade designated as a contract
market under Section 5 of the CEA, or (b) a commodity option
entered into pursuant to CFTC Regulation 32.3(a).

 

“Swap Obligation” shall
mean any obligation to pay or perform under any agreement, contract
or transaction that constitutes a Swap which is also a
Lender-Provided Interest Rate Hedge.

 

“Swing Loan Lender” shall
mean PNC, in its capacity as lender of the Swing
Loans.

 

“Swing Loan Note” shall
mean the promissory note described in Section 2.4(a)
hereof.

 

“Swing Loans” shall mean
the Advances made pursuant to Section 2.4 hereof.

 

“Taxes” shall mean all
present or future taxes, levies, imposts, duties, deductions,
withholdings, assessments, fees or other charges imposed by any
Governmental Body, including any interest, additions to tax or
penalties applicable thereto.

 

“Term” shall have the
meaning set forth in Section 13.1 hereof.

 

“Termination Event” shall
mean: (a) a Reportable ERISA Event with respect to any Plan; (b)
the withdrawal of any Loan Party or any member of the Controlled
Group from a Plan during a plan year in which such entity was a
“substantial employer” as defined in Section 4001(a)(2)
of ERISA or a cessation of operations that is treated as such a
withdrawal under Section 4062(e) of ERISA; (c) the providing of
notice of intent to terminate a Plan in a distress termination
described in Section 4041(c) of ERISA; (d) the commencement of
proceedings by the PBGC to terminate a Plan; (e) any event or
condition (i) which might constitute grounds under Section 4042 of
ERISA for the termination of, or the appointment of a trustee to
administer, any Plan, or (ii) that may result in the termination of
a Multiemployer Plan pursuant to Section 4041A of ERISA; (f) the
partial or complete withdrawal, within the meaning of Section 4203
or 4205 of ERISA, of any Loan Party or any member of the Controlled
Group from a Multiemployer Plan; (g) notice that a Multiemployer
Plan is subject to Section 4245 of ERISA; or (h) the imposition of
any liability under Title IV of ERISA, other than for PBGC premiums
due but not delinquent, upon any Loan Party or any member of the
Controlled Group.

 

“Toxic Substance” shall
mean and include any material present on any Real Property owned or
leased by any Loan Party (including the Leasehold Interests) which
has been shown to have significant adverse effect on human health
or which is subject to regulation under the Toxic Substances
Control Act (TSCA), 15 U.S.C. §§ 2601 et seq., applicable
state law, or any other applicable Federal or state laws now in
force or hereafter enacted relating to toxic substances.
“Toxic Substance” includes but is not limited to
asbestos, polychlorinated biphenyls (PCBs) and lead-based
paints.

 

“Transactions” shall mean
the transactions under or contemplated by this Agreement, the Other
Documents.

 

“Transferee” shall have
the meaning set forth in Section 16.3(d) hereof.

 

 

 

-28-

 

 

“Undrawn Availability” at
a particular date shall mean an amount equal to (a) the lesser of
(i) the Formula Amount or (ii) the Maximum Revolving Advance
Amount, minus (b)
the outstanding amount of Revolving Advances, minus (c) the Maximum
Undrawn Amount of all outstanding Letters of Credit, minus (d) the sum of
(i) all amounts due and owing to any Borrower’s trade
creditors which are outstanding sixty (60) days or more past their
due date, plus
(ii) fees and expenses incurred in connection with the
Transactions for which Borrowers are liable but which have not been
paid or charged to Borrowers’ Account.

 

“Unfunded Capital
Expenditures” shall mean, as to any Loan Party,
without duplication, Capital Expenditures funded (a) from such Loan
Party’s internally generated cash flow or (b) with the
proceeds of a Revolving Advance or Swing Loan.

 

“Uniform Commercial Code”
shall have the meaning set forth in Section 1.3
hereof.

 

“USA PATRIOT Act” shall
mean the Uniting and Strengthening America by Providing Appropriate
Tools Required to Intercept and Obstruct Terrorism Act of 2001,
Public Law 107-56, as the same has been, or shall hereafter be,
amended, modified, supplemented, renewed, extended or
replaced.

 

“U.S. Borrower” means any
Borrower that is a U.S. Person.

 

“U.S. Person” means any
Person that is a “United States Person” as defined in
Section 7701(a)(30) of the Code.

 

“Usage Amount” shall have
the meaning set forth in Section 3.3(b) hereof.

 

“Withholding Agent” means
any Loan Party and Agent.

 

“Write-Down and Conversion
Powers” shall mean, with respect to any EEA Resolution
Authority, the write-down and conversion powers of such EEA
Resolution Authority from time to time under the Bail-In
Legislation for the applicable EEA Member Country, which write-down
and conversion powers are described in the EU Bail-In Legislation
Schedule.

 

1.3. Uniform Commercial Code
Terms. All terms used
herein and defined in the Uniform Commercial Code as adopted in the
State of New York from time to time (the “Uniform Commercial
Code”) shall have the meaning given therein unless otherwise
defined herein. Without limiting the foregoing, the terms
“accounts”, “chattel paper” (and
“electronic chattel paper” and “tangible chattel
paper”), “commercial tort claims”, “deposit
accounts”, “financial asset”,
“fixtures”, “general intangibles”,
“goods”, “instruments”,
“letter-of-credit rights”, “payment
intangibles”, “proceeds”, “promissory
note” “securities”, “software” and
“supporting obligations” as and when used in the
description of Collateral shall have the meanings given to such
terms in Articles 8 or 9 of the Uniform Commercial Code. To the
extent the definition of any category or type of collateral is
expanded by any amendment, modification or revision to the Uniform
Commercial Code, such expanded definition will apply automatically
as of the date of such amendment, modification or
revision.

 

 

 

-29-

 

 

1.4. Certain
Matters of Construction. The terms
“herein”, “hereof” and
“hereunder” and other words of similar import refer to
this Agreement as a whole and not to any particular section or
subsection. All references herein to Articles, Sections, Exhibits
and Schedules shall be construed to refer to Articles and Sections
of, and Exhibits and Schedules to, this Agreement, except where the
context clearly requires otherwise. Any pronoun used shall be
deemed to cover all genders. Wherever appropriate in the context,
terms used herein in the singular also include the plural and vice
versa. All references to statutes and related regulations shall
include any amendments of same and any successor statutes and
regulations. Unless otherwise provided, all references to any
instruments or agreements to which Agent is a party, including
references to any of the Other Documents, shall include any and all
modifications, supplements or amendments thereto, any and all
restatements or replacements thereof and any and all extensions or
renewals thereof. Except as otherwise expressly provided for
herein, all references herein to the time of day shall mean the
time in New York, New York. Whenever the words
“including” or “include” shall be used,
such words shall be understood to mean “including, without
limitation” or “include, without limitation”. A
Default or an Event of Default shall be deemed to exist at all
times during the period commencing on the date that such Default or
Event of Default occurs to the date on which such Default or Event
of Default is waived in writing pursuant to this Agreement or, in
the case of a Default, is cured within any period of cure expressly
provided for in this Agreement; and an Event of Default shall
“continue” or be “continuing” until such
Event of Default has been waived in writing by Required Lenders.
Any Lien referred to in this Agreement or any of the Other
Documents as having been created in favor of Agent, any agreement
entered into by Agent pursuant to this Agreement or any of the
Other Documents, any payment made by or to or funds received by
Agent pursuant to or as contemplated by this Agreement or any of
the Other Documents, or any act taken or omitted to be taken by
Agent, shall, unless otherwise expressly provided, be created,
entered into, made or received, or taken or omitted, for the
benefit or account of Agent and Lenders. Wherever the phrase
“to the best of Borrowers’ knowledge” or
“to the best of the Loan Parties’ knowledge” or
words of similar import relating to the knowledge or the awareness
of any Loan Party are used in this Agreement or Other Documents,
such phrase shall mean and refer to (i) the actual knowledge of an
executive officer of any Loan Party or (ii) the knowledge that an
executive officer would have obtained if he/she had engaged in a
good faith and diligent performance of his/her duties. All
covenants hereunder shall be given independent effect so that if a
particular action or condition is not permitted by any of such
covenants, the fact that it would be permitted by an exception to,
or otherwise within the limitations of, another covenant shall not
avoid the occurrence of a default if such action is taken or
condition exists. In addition, all representations and warranties
hereunder shall be given independent effect so that if a particular
representation or warranty proves to be incorrect or is breached,
the fact that another representation or warranty concerning the
same or similar subject matter is correct or is not breached will
not affect the incorrectness of a breach of a representation or
warranty hereunder.

 

II. ADVANCES,
PAYMENTS.

 

2.1. Revolving
Advances.

 

(a) Amount of Revolving Advances.
Subject to the terms and conditions set forth in this Agreement,
each Revolving Lender, severally and not jointly, will make
Revolving Advances to Borrowers in aggregate amounts outstanding at
any time equal to such Lender’s Revolving Commitment
Percentage of the lesser of (x) the Maximum Revolving Advance
Amount, less the
outstanding amount of Swing Loans, less the aggregate Maximum
Undrawn Amount of all outstanding Letters of Credit, less Reserves
established hereunder or (y) an amount equal to the result of the
following (hereinafter, the “Formula
Amount”):

 

(i) the sum of (a) up
to 85% of Eligible Receivables, plus (b) up to the lesser of
(1) 80% of Eligible Unbilled Receivables and (2) $10,000,000,
minus

 

 

 

-30-

 

 

(ii) the aggregate
Maximum Undrawn Amount of all outstanding Letters of Credit,
minus

 

(iii) Reserves
established hereunder.

 

At the
request of any Lender, the Revolving Advances shall be evidenced by
one or more secured promissory notes (collectively, the
“Revolving Credit
Note”) substantially in the form attached hereto as
Exhibit 2.1(a) hereto.

 

(b) Discretionary Rights. From
time to time in its Permitted Discretion, Agent may (i) increase or
decrease the Advance Rates, (ii) establish Reserves, (iii) increase
or decrease the percentages set forth in clause (b) of the
definition of “Eligible Receivables,” (iv) establish
credit limits for a Customer pursuant to clause (l) of the
definition of “Eligible Receivables” and (v) otherwise
establish criteria for Eligible Receivables as set forth in clause
(q) of the definition of “Eligible Receivables.” Each
Borrower consents to any such increases or decreases, Reserves,
credit limits and other criteria and acknowledges that such actions
may limit or restrict Advances requested by Borrowing Agent. Prior
to the occurrence of an Event of Default or Default, Agent shall
give Borrowing Agent as much prior written notice as is possible,
but no less than five (5) days, of its intention to take any of the
actions described in the first sentence of this Section 2.1(b),
along with a description of such actions. The rights of Agent under
this subsection are subject to the provisions of
Section 16.2(b) hereof.

 

2.2. Procedures for Requesting Revolving
Advances; Procedures for Selection of Applicable Interest Rates for
All Advances.

 

(a) Borrowing Agent on
behalf of any Borrower may notify Agent prior to 3:00 p.m. on a
Business Day of a Borrower’s request to incur, on that day, a
Revolving Advance hereunder. Should any amount required to be paid
as interest hereunder, or as fees or other charges under this
Agreement or any other agreement with Agent or Lenders, or with
respect to any other Obligation under this Agreement, become due,
same shall be deemed a request for a Revolving Advance maintained
as a Domestic Rate Loan as of the date such payment is due, in the
amount required to pay in full such interest, fee, charge or
Obligation, and such request shall be irrevocable. If the Borrowers
enter into a separate written agreement with Agent regarding
Agent’s auto-advance service, then each Advance made pursuant
to such service (including Advances made for the payment of
interest, fees, charges or obligations) shall be deemed an
irrevocable request for a Revolving Advance maintained as a
Domestic Rate Loan as of the date such auto-advance is
made.

 

(b) Notwithstanding the
provisions of subsection (a) above, in the event any Borrower
desires to obtain a LIBOR Rate Loan for any Advance (other than a
Swing Loan), Borrowing Agent shall give Agent written notice by no
later than 3:00 p.m. on the day which is three (3) Business Days
prior to the date such LIBOR Rate Loan is to be borrowed,
specifying (i) the date of the proposed borrowing (which shall be a
Business Day), (ii) the type of borrowing and the amount of such
Advance to be borrowed, which amount shall be in a minimum amount
of $3,000,000 and in integral multiples of $1,000,000 thereafter,
and (iii) the duration of the first Interest Period therefor.
Interest Periods for LIBOR Rate Loans shall be for one, two or
three months; provided that, if an Interest Period would end on a
day that is not a Business Day, it shall end on the next succeeding
Business Day unless such day falls in the next succeeding calendar
month in which case the Interest Period shall end on the next
preceding Business Day. Any Interest Period that begins on the last
Business Day of a calendar month (or a day for which there is no
numerically corresponding day in the last calendar month of such
Interest Period) shall end on the last Business Day of the last
calendar month of such Interest Period. Upon and after the
occurrence of an Event of Default, and during the continuation
thereof, at the option of Agent or at the direction of the Required
Lenders, no LIBOR Rate Loan shall be made available to any
Borrower. After giving effect to each requested LIBOR Rate Loan,
including those which are converted from a Domestic Rate Loan under
Section 2.2(e) below, there shall not be outstanding more than four
(4) LIBOR Rate Loans, in the aggregate at any time.

 

 

 

-31-

 

 

(c) Each Interest
Period of a LIBOR Rate Loan shall commence on the date such LIBOR
Rate Loan is made and shall end on such date as Borrowing Agent may
elect as set forth in subsection (b)(iii) above, provided that the
exact length of each Interest Period shall be determined in
accordance with the practice of the interbank market for offshore
Dollar deposits and no Interest Period shall end after the last day
of the Term.

 

(d) Borrowing Agent
shall elect the initial Interest Period applicable to a LIBOR Rate
Loan by its notice of borrowing given to Agent pursuant to Section
2.2(b) above or by its notice of conversion given to Agent pursuant
to Section 2.2(e) below, as the case may be. Borrowing Agent shall
elect the duration of each succeeding Interest Period by giving
irrevocable written notice to Agent of such duration not later than
3:00 p.m. on the day which is three (3) Business Days prior to the
last day of the then current Interest Period applicable to such
LIBOR Rate Loan. If Agent does not receive timely notice of the
Interest Period elected by Borrowing Agent, Borrowing Agent shall
be deemed to have elected to convert such LIBOR Rate Loan to a
Domestic Rate Loan as of the last day of the Interest Period
applicable to such LIBOR Rate Loan subject to Section 2.2(e)
below.

 

(e) Unless a Default
or Event of Default shall have occurred and be continuing and Agent
opts or is directed by the Required Lenders otherwise, Borrowing
Agent may, on the last Business Day of the then current Interest
Period applicable to any outstanding LIBOR Rate Loan, or on any
Business Day with respect to Domestic Rate Loans, convert any such
LIBOR Rate Loan or Domestic Rate Loan into a LIBOR Rate Loan in the
same aggregate principal amount. If Borrowing Agent desires to
convert a LIBOR Rate Loan or a Domestic Rate Loan as provided
herein, Borrowing Agent shall give Agent written notice by no later
than 3:00 p.m. on the day which is three (3) Business Days prior to
the date on which such conversion is to occur (which date shall be
the last Business Day of the Interest Period for the applicable
LIBOR Rate Loan) specifying, in each case, the date of such
conversion, the LIBOR Rate Loan(s) or Domestic Rate Loan(s) to be
converted and the duration of the first Interest Period
therefor.

 

(f) At its option and
upon written notice given prior to 3:00 p.m. at least
three (3) Business Days prior to the date of such prepayment,
Borrowers may, subject to Section 2.2(g) below, prepay the
LIBOR Rate Loans in whole at any time or in part from time to time
with accrued interest on the principal being prepaid to the date of
such prepayment (it being understood that payment on the last day
of an Interest Period does not constitute a prepayment for purposes
of this section). Borrowing Agent shall specify the date of
prepayment of Advances which are LIBOR Rate Loans and the amount of
such prepayment. In the event that any prepayment of a LIBOR Rate
Loan is required or permitted on a date other than the last
Business Day of the then current Interest Period with respect
thereto, Borrowers shall indemnify Agent and Lenders therefor in
accordance with Section 2.2(g) below.

 

(g) Each Loan Party
shall indemnify Agent and Lenders and hold Agent and Lenders
harmless from and against any and all losses or expenses that Agent
and Lenders may sustain or incur as a consequence of any
prepayment, conversion of or any default by any Borrower in the
payment of the principal of or interest on any LIBOR Rate Loan or
failure by any Borrower to complete a borrowing of, a prepayment of
or conversion of or to a LIBOR Rate Loan after notice thereof has
been given, including, but not limited to, any interest payable by
Agent or Lenders to lenders of funds obtained by it in order to
make or maintain its LIBOR Rate Loans hereunder. A certificate as
to any additional amounts payable pursuant to the foregoing
sentence submitted by Agent or any Lender to Borrowing Agent shall
be conclusive absent manifest error.

 

 

 

-32-

 

 

(h) Notwithstanding
any other provision hereof, if any Change in Law shall make it
unlawful for Lenders or any Lender (for purposes of this subsection
(h), the term “Lender” shall include any Lender and the
office or branch where any Lender or any Person controlling such
Lender makes or maintains any LIBOR Rate Loans) to make or maintain
its LIBOR Rate Loans, the obligation of Lenders (or such affected
Lender) to make LIBOR Rate Loans hereunder shall forthwith be
cancelled and Borrowers shall, if any affected LIBOR Rate Loans are
then outstanding, promptly upon request from Agent, either pay all
such affected LIBOR Rate Loans or convert such affected LIBOR Rate
Loans into Domestic Rate Loans. If any such payment or conversion
of any LIBOR Rate Loan is made on a day that is not the last day of
the Interest Period applicable to such LIBOR Rate Loan, Borrowers
shall pay Agent, upon Agent’s request, such amount or amounts
set forth in clause (g) above. A certificate as to any additional
amounts payable pursuant to the foregoing sentence submitted by
Lenders to Borrowing Agent shall be conclusive absent manifest
error.

 

(i)           Anything
to the contrary contained herein notwithstanding, neither any Agent
nor any Lender, nor any of their participants, is required actually
to acquire LIBOR deposits to fund or otherwise match fund any
Obligation as to which interest accrues based on the LIBOR Rate.
The provisions set forth herein shall apply as if each Lender or
its participants had match funded any Obligation as to which
interest is accruing based on the LIBOR Rate by acquiring LIBOR
deposits for each Interest Period in the amount of the LIBOR Rate
Loans.

 

2.3. Reserved.

 

2.4. Swing Loans.

 

(a) Subject to the
terms and conditions set forth in this Agreement, and in order to
minimize the transfer of funds between Lenders and Agent for
administrative convenience, Agent, Revolving Lenders and Swing Loan
Lender agree that in order to facilitate the administration of this
Agreement, Swing Loan Lender may, at its election and option made
in its sole discretion cancelable at any time for any reason
whatsoever, make swing loan advances (“Swing Loans”)
available to Borrowers as provided for in this Section 2.4 at any
time or from time to time after the Closing Date to, but not
including, the last day of the Term, in an aggregate principal
amount up to but not in excess of the Maximum Swing Loan Advance
Amount, provided that the outstanding aggregate principal amount of
Swing Loans and the Revolving Advances at any one time outstanding
shall not exceed an amount equal to the lesser of (i) the Maximum
Revolving Advance Amount less the Maximum Undrawn Amount of all
outstanding Letters of Credit or (ii) the Formula Amount. All Swing
Loans shall be Domestic Rate Loans only. Borrowers may borrow (at
the option and election of Swing Loan Lender), repay and re-borrow
(at the option and election of Swing Loan Lender) Swing Loans and
Swing Loan Lender may make Swing Loans as provided in this Section
2.4 during the period between Settlement Dates.  At the
request of Swing Loan Lender, all Swing Loans shall be evidenced by
a secured promissory note (the “Swing Loan Note”)
substantially in the form attached as Exhibit 2.4(a) hereto. Swing
Loan Lender’s agreement to make Swing Loans under this
Agreement is cancelable at any time for any reason whatsoever and
the making of Swing Loans by Swing Loan Lender from time to time
shall not create any duty or obligation, or establish any course of
conduct, pursuant to which Swing Loan Lender shall thereafter be
obligated to make Swing Loans in the future.

 

(b) Upon either (i)
any request by Borrowing Agent for a Revolving Advance made
pursuant to Section 2.2(a) hereof or (ii) the occurrence of any
deemed request by Borrowers for a Revolving Advance pursuant to the
provisions of Section 2.2(a) hereof, Swing Loan Lender may elect,
in its sole discretion, to have such request or deemed request
treated as a request for a Swing Loan, and may advance same day
funds to Borrowers as a Swing Loan; provided that notwithstanding
anything to the contrary provided for herein, Swing Loan Lender may
not make Swing Loan Advances if Swing Loan Lender has been notified
by Agent or by Required Lenders that one or more of the applicable
conditions set forth in Section 8.2 hereof have not been satisfied
or the Revolving Commitments have been terminated for any
reason.

 

 

 

-33-

 

 

(c) Upon the making of
a Swing Loan (whether before or after the occurrence of a Default
or an Event of Default and regardless of whether a Settlement has
been requested with respect to such Swing Loan), each Revolving
Lender shall be deemed, without further action by any party hereto,
to have unconditionally and irrevocably purchased from Swing Loan
Lender, without recourse or warranty, an undivided interest and
participation in such Swing Loan in proportion to its Revolving
Commitment Percentage. Swing Loan Lender or Agent may, at any time,
require the Revolving Lenders to fund such participations by means
of a Settlement as provided for in Section 2.6(d) hereof. From and
after the date, if any, on which any Revolving Lender is required
to fund, and funds, its participation in any Swing Loans purchased
hereunder, Agent shall promptly distribute to such Lender its
Revolving Commitment Percentage of all payments of principal and
interest and all proceeds of Collateral received by Agent in
respect of such Swing Loan; provided that no Revolving Lender shall
be obligated in any event to make Revolving Advances in an amount
in excess of its Revolving Commitment Amount minus its
Participation Commitment (taking into account any reallocations
under Section 2.22 hereof) of the Maximum Undrawn Amount of all
outstanding Letters of Credit.

 

2.5. Disbursement of Advance
Proceeds. All Advances
shall be disbursed from whichever office or other place Agent may
designate from time to time and, together with any and all other
Obligations of the Loan Parties to Agent or Lenders, shall be
charged to Borrowers’ Account on Agent’s books. The
proceeds of each Revolving Advance or Swing Loan requested by
Borrowing Agent on behalf of any Borrower shall be made available
to the applicable Borrower on the day so requested by way of credit
to such Borrower’s operating account at PNC, or such other
bank as Borrowing Agent may designate following notification to
Agent, in immediately available federal funds or other immediately
available funds. The proceeds of each Revolving Advance or Swing
Loan deemed to have been requested by any Borrower under Section
2.2(a), 2.6(b) or 2.14 hereof shall be disbursed to Agent to be
applied to the outstanding Obligations giving rise to such deemed
request. During the Term, Borrowers may use the Revolving Advances
and Swing Loans by borrowing, prepaying and re-borrowing, all in
accordance with the terms and conditions hereof.

 

2.6. Making and Settlement of
Advances.

 

(a) Each borrowing of
Revolving Advances shall be advanced according to the applicable
Revolving Commitment Percentages of Revolving Lenders (subject to
any contrary terms of Section 2.22 hereof). Each borrowing of Swing
Loans shall be advanced by Swing Loan Lender alone.

 

(b) Promptly after
receipt by Agent of a request or a deemed request for a Revolving
Advance pursuant to Section 2.2(a) hereof and, with respect to
Revolving Advances, to the extent Agent elects not to provide a
Swing Loan or the making of a Swing Loan would result in the
aggregate amount of all outstanding Swing Loans exceeding the
maximum amount permitted in Section 2.4(a) hereof, Agent shall
notify the Revolving Lenders of its receipt of such request
specifying the information provided by Borrowing Agent and the
apportionment among Lenders of the requested Revolving Advance as
determined by Agent in accordance with the terms hereof. Each
Lender shall remit the principal amount of each Revolving Advance
to Agent such that Agent is able to, and Agent shall, to the extent
the applicable Lenders have made funds available to it for such
purpose and subject to Section 8.2 hereof, fund such Revolving
Advance to Borrowers in U.S. Dollars and immediately available
funds at the Payment Office prior to the close of business, on the
applicable borrowing date; provided that if any
applicable Lender fails to remit such funds to Agent in a timely
manner, Agent may elect in its sole discretion to fund with its own
funds the Revolving Advance of such Lender on such borrowing date,
and such Lender shall be subject to the repayment obligation in
Section 2.6(c) hereof.

 

 

 

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(c) Unless Agent shall
have been notified by telephone, confirmed in writing, by any
Revolving Lender that such Lender will not make the amount which
would constitute its applicable Revolving Commitment Percentage of
the requested Revolving Advance available to Agent, Agent may (but
shall not be obligated to) assume that such Lender has made such
amount available to Agent on such date in accordance with Section
2.6(b) hereof and may, in reliance upon such assumption, make
available to Borrowers a corresponding amount. In such event, if a
Lender has not in fact made its applicable Revolving Commitment
Percentage of the requested Revolving Advance available to Agent,
then the applicable Lender and Borrowers severally agree to pay to
Agent on demand such corresponding amount with interest thereon,
for each day from and including the date such amount is made
available to Borrowers through but excluding the date of payment to
Agent, at (i) in the case of a payment to be made by such Lender,
the greater of (A) (x) the daily average Federal Funds Effective
Rate (computed on the basis of a year of 360 days) during such
period as quoted by Agent, times (y) such amount or (B) a rate
determined by Agent in accordance with banking industry rules on
interbank compensation, and (ii) in the case of a payment to be
made by Borrowers, the Revolving Interest Rate for Revolving
Advances that are Domestic Rate Loans. If such Lender pays its
share of the applicable Revolving Advance to Agent, then the amount
so paid shall constitute such Lender’s Revolving Advance. Any
payment by Borrowers shall be without prejudice to any claim
Borrowers may have against a Revolving Lender that shall have
failed to make such payment to Agent. A certificate of Agent
submitted to any Lender or Borrowers with respect to any amounts
owing under this subsection (c) shall be conclusive, in the absence
of manifest error.

 

(d) Agent, on behalf
of Swing Loan Lender, shall demand settlement (a
“Settlement”) of all or any Swing Loans with Revolving
Lenders on at least a weekly basis, or on any more frequent date
that Agent elects or that Swing Loan Lender at its option
exercisable for any reason whatsoever may request, by notifying
Revolving Lenders of such requested Settlement by facsimile,
telephonic or electronic transmission no later than 3:00 p.m. on
the date of such requested Settlement (the “Settlement
Date”). Subject to any contrary provisions of Section 2.22
hereof, each Revolving Lender shall transfer the amount of such
Lender’s Revolving Commitment Percentage of the outstanding
principal amount (plus interest accrued thereon to the extent
requested by Agent) of the applicable Swing Loan with respect to
which Settlement is requested by Agent, to such account of Agent as
Agent may designate not later than 5:00 p.m. on such Settlement
Date if requested by Agent by 3:00 p.m., otherwise not later than
5:00 p.m. on the next Business Day. Settlements may occur at any
time notwithstanding that the conditions precedent to making
Revolving Advances set forth in Section 8.2 hereof have not been
satisfied or the Revolving Commitments shall have otherwise been
terminated at such time. All amounts so transferred to Agent shall
be applied against the amount of outstanding Swing Loans and, when
so applied shall constitute Revolving Advances of such Lenders
accruing interest as Domestic Rate Loans. If any such amount is not
transferred to Agent by any Revolving Lender on such Settlement
Date, Agent shall be entitled to recover such amount on demand from
such Lender together with interest thereon as specified in Section
2.6(c) hereof.

 

(e) If any Lender or
Participant (a “Benefited Lender”) shall at any time
receive any payment of all or part of its Advances, or interest
thereon, or receive any Collateral in respect thereof (whether
voluntarily or involuntarily or by set-off) in a greater proportion
than any such payment to and Collateral received by any other
Lender, if any, in respect of such other Lender’s Advances,
or interest thereon, and such greater proportionate payment or
receipt of Collateral is not expressly permitted hereunder, such
Benefited Lender shall purchase for cash from the other Lenders a
participation in such portion of each such other Lender’s
Advances, or shall provide such other Lender with the benefits of
any such Collateral, or the proceeds thereof, as shall be necessary
to cause such Benefited Lender to share the excess payment or
benefits of such Collateral or proceeds ratably with each of the
other Lenders; provided, however, that if all or any portion of
such excess payment or benefits is thereafter recovered from such
Benefited Lender, such purchase shall be rescinded, and the
purchase price and benefits returned, to the extent of such
recovery, but without interest. Each Borrower consents to the
foregoing and agrees, to the extent it may effectively do so under
Applicable Law, that each Lender so purchasing a portion of another
Lender’s Advances may exercise all rights of payment
(including rights of set-off) with respect to such portion as fully
as if such Lender were the direct holder of such portion, and the
obligations owing to each such purchasing Lender in respect of such
participation and such purchased portion of any other
Lender’s Advances shall be part of the Obligations secured by
the Collateral, and the obligations owing to each such purchasing
Lender in respect of such participation and such purchased portion
of any other Lender’s Advances shall be part of the
Obligations secured by the Collateral.

 

 

 

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2.7. Maximum
Advances. Notwithstanding
anything to the contrary set forth in Section 2.1(a) or
otherwise in this Agreement, the aggregate principal amount of
Revolving Advances and Swing Loans outstanding at any time shall
not exceed the lesser of (a) the Maximum Revolving Advance Amount
less the aggregate Maximum Undrawn Amount of all issued and
outstanding Letters of Credit or (b) the Formula
Amount.

 

2.8. Manner and Repayment of
Advances.

 

(a) The Revolving
Advances and Swing Loans shall be due and payable in full on the
last day of the Term subject to earlier prepayment as herein
provided. Notwithstanding the foregoing, all Advances shall be
subject to earlier repayment upon (x) acceleration upon the
occurrence of an Event of Default under this Agreement or
(y) termination of this Agreement. Each payment (including
each prepayment) by any Borrower on account of the principal of and
interest on the Advances shall be applied, first to the outstanding
Swing Loans and next, pro rata according to the applicable
Revolving Commitment Percentages of Lenders, to the outstanding
Revolving Advances (subject to any contrary provisions of Section
2.22 hereof).

 

(b) Each Borrower
recognizes that the amounts evidenced by checks, notes, drafts or
any other items of payment relating to and/or proceeds of
Collateral may not be collectible by Agent on the date received by
Agent. Agent shall conditionally credit Borrowers’ Account
for each item of payment on the next Business Day after the
Business Day on which such item of payment is received by Agent
(and the Business Day on which each such item of payment is so
credited shall be referred to, with respect to such item, as the
“Application Date”). Agent is not, however, required to
credit Borrowers’ Account for the amount of any item of
payment which is unsatisfactory to Agent and Agent may charge
Borrowers’ Account for the amount of any item of payment
which is returned, for any reason whatsoever, to Agent unpaid.
Subject to the foregoing, Borrowers agree that for purposes of
computing the interest charges under this Agreement, each item of
payment received by Agent shall be deemed applied by Agent on
account of the Obligations on its respective Application Date. All
proceeds received by Agent shall be applied to the Obligations in
accordance with Section 4.8(h) hereof.

 

(c) All payments of
principal, interest and other amounts payable hereunder, or under
any of the Other Documents shall be made to Agent at the Payment
Office not later than 1:00 p.m. on the due date therefor in Dollars
in federal funds or other funds immediately available to Agent.
Agent shall have the right to effectuate payment of any and all
Obligations due and owing hereunder by charging Borrowers’
Account or by making Advances as provided in Section 2.2(a)
hereof.

 

(d) Except as
expressly provided herein, all payments (including prepayments) to
be made by any Borrower on account of principal, interest, fees and
other amounts payable hereunder shall be made without deduction,
setoff or counterclaim and shall be made to Agent on behalf of
Lenders to the Payment Office, in each case on or prior to 1:00
p.m., in Dollars and in immediately available funds.

 

2.9. Repayment of Excess
Advances. If at any time
the aggregate balance of outstanding Revolving Advances and/or
Advances taken as a whole exceeds the maximum amount of such type
of Advances and/or Advances taken as a whole (as applicable)
permitted hereunder, such excess Advances shall be immediately due
and payable without the necessity of any demand, at the Payment
Office, whether or not a Default or an Event of Default has
occurred.

 

2.10. Statement of
Account. Agent shall
maintain, in accordance with its customary procedures, a loan
account (“Borrowers’ Account”) in the name of
Borrowers in which shall be recorded the date and amount of each
Advance made by Agent or Lenders and the date and amount of each
payment in respect thereof; provided, however, the failure by Agent
to record the date and amount of any Advance shall not adversely
affect Agent or any Lender. Each month, Agent shall send to
Borrowing Agent a statement showing the accounting for the Advances
made, payments made or credited in respect thereof, and other
transactions between Agent, Lenders and Borrowers during such
month. The records of Agent with respect to Borrowers’
Account shall be conclusive evidence absent manifest error of the
amounts of Advances and other charges thereto and of payments
applicable thereto.

 

 

 

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2.11. Letters
of Credit.

 

(a) Subject to the
terms and conditions hereof, the applicable Issuer shall issue or
cause the issuance of standby letters of credit denominated in
Dollars (“Letters of Credit”) for the account of any
Borrower except to the extent that the issuance thereof would then
cause the sum of (i) the outstanding Revolving Advances plus (ii)
the outstanding Swing Loans, plus (iii) the Maximum Undrawn
Amount of all outstanding Letters of Credit, plus (iv) the Maximum
Undrawn Amount of the Letter of Credit to be issued to exceed the
lesser of (x) the Maximum Revolving Advance Amount or (y) the
Formula Amount (calculated without giving effect to the deductions
provided for in Section 2.1(a) hereof). The Maximum Undrawn
Amount of all outstanding Letters of Credit shall not exceed in the
aggregate at any time the Letter of Credit Sublimit. All
disbursements or payments related to Letters of Credit shall be
deemed to be a Revolving Advance as provided by Section 2.14
hereof. Letters of Credit that have not been drawn upon shall not
bear interest (but fees shall accrue in respect of outstanding
Letters of Credit as provided in Section 3.2
hereof).

 

(b) Notwithstanding
any provision of this Agreement, no Issuer shall be under any
obligation to issue any Letter of Credit if (i) any order, judgment
or decree of any Governmental Body or arbitrator shall by its terms
purport to enjoin or restrain  such Issuer from issuing any
Letter of Credit, or any Law applicable to such Issuer or any
request or directive (whether or not having the force of law) from
any Governmental Body with jurisdiction over such Issuer shall
prohibit, or request that such Issuer refrain from, the issuance of
letters of credit generally or the Letter of Credit in particular
or shall impose upon such Issuer with respect to the Letter of
Credit any restriction, reserve or capital requirement (for which
such Issuer is not otherwise compensated hereunder) not in effect
on the Closing Date, or shall impose upon such Issuer any
unreimbursed loss, cost or expense which was not applicable on the
Closing Date, and which such Issuer in good faith deems material to
it, or (ii) the issuance of the Letter of Credit would violate one
or more policies of such Issuer applicable to letters of credit
generally.

 

2.12. Issuance of Letters of
Credit.

 

(a) Borrowing Agent,
on behalf of any Borrower, may request any Issuer to issue or cause
the issuance of a Letter of Credit by delivering to such Issuer,
with a copy to Agent at the Payment Office, prior to 10:00 a.m., at
least five (5) Business Days prior to the proposed date of
issuance, such Issuer’s form of Letter of Credit Application
(the “Letter of Credit Application”) completed to the
satisfaction of Agent and such Issuer; and, such other
certificates, documents and other papers and information as Agent
or such Issuer may reasonably request. No Issuer shall issue any
requested Letter of Credit if such Issuer has received notice from
Agent or any Lender that one or more of the applicable conditions
set forth in Section 8.2 hereof have not been satisfied or the
Revolving Commitments have been terminated for any
reason.

 

(b) Each Letter of
Credit shall, among other things, (i) provide for the payment of
sight drafts, or other written demands for payment, and (ii) have
an expiry date not later than twelve (12) months after such Letter
of Credit’s date of issuance and in no event later than the
last day of the Term. Each standby Letter of Credit shall be
subject either to the Uniform Customs and Practice for Documentary
Credits as most recently published by the International Chamber of
Commerce at the time a Letter of Credit is issued (the
“UCP”) or the International Standby Practices
(International Chamber of Commerce Publication Number 590), or any
subsequent revision thereof at the time a standby Letter of Credit
is issued, as determined by the applicable Issuer.

 

(c) Agent shall use
its reasonable efforts to notify Lenders of the request by
Borrowing Agent for a Letter of Credit hereunder.

 

 

 

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2.13. Requirements
For Issuance of Letters of Credit. Borrowing Agent
shall authorize and direct the applicable Issuer to name the
applicable Borrower as the “Applicant” or
“Account Party” of each Letter of Credit. If Agent is
not the Issuer of any Letter of Credit, Borrowing Agent shall
authorize and direct the applicable Issuer to deliver to Agent all
agreements, documents or instruments and property received by such
Issuer pursuant to such Letter of Credit and to accept and rely
upon Agent’s instructions and agreements with respect to all
matters arising in connection with such Letter of Credit, and the
application therefor.

 

2.14. Disbursements,
Reimbursement.

 

(a) Immediately upon
the issuance of each Letter of Credit, each Revolving Lender shall
be deemed to, and hereby irrevocably and unconditionally agrees to,
purchase from the applicable Issuer a participation in each Letter
of Credit and each drawing thereunder in an amount equal to such
Lender’s Revolving Commitment Percentage of the Maximum
Undrawn Amount of such Letter of Credit (as in effect from time to
time) and the amount of such drawing, respectively.

 

(b) In the event of
any request for a drawing under a Letter of Credit by the
beneficiary or transferee thereof, the applicable Issuer will
promptly notify Agent and Borrowing Agent. Regardless of whether
Borrowing Agent shall have received such notice, Borrowers shall
reimburse such Issuer in an amount equal to the amount so paid by
such Issuer (such obligation to reimburse such Issuer shall
sometimes be referred to as a “Reimbursement
Obligation”) prior to 12:00 Noon, on each date that an amount
is paid by such Issuer under such Letter of Credit (each such date,
a “Drawing Date”). In the event Borrowers fail to
reimburse such Issuer for the full amount of any drawing under any
Letter of Credit by 12:00 Noon, on the Drawing Date, such Issuer
will promptly notify Agent and each Revolving Lender thereof, and
Borrowers shall be automatically deemed to have requested that a
Revolving Advance maintained as a Domestic Rate Loan be made by
Lenders to be disbursed on the Drawing Date under such Letter of
Credit, and Revolving Lenders shall be unconditionally obligated to
fund such Revolving Advance (all whether or not the conditions
specified in Section 8.2 hereof are then satisfied or the Revolving
Commitments have been terminated for any reason) as provided for in
Section 2.14(c) below. Any notice given by any Issuer pursuant to
this Section 2.14(b) may be oral if promptly confirmed in
writing; provided that the lack of such a confirmation shall not
affect the conclusiveness or binding effect of such
notice.

 

(c) Each Revolving
Lender shall upon any notice pursuant to Section 2.14(b) above make
available to the applicable Issuer through Agent at the Payment
Office an amount in immediately available funds equal to its
Revolving Commitment Percentage (subject to any contrary provisions
of Section 2.22 hereof) of the amount of the drawing, whereupon the
participating Lenders shall (subject to Section 2.14(d) hereof)
each be deemed to have made a Revolving Advance maintained as a
Domestic Rate Loan to Borrowers in that amount. If any Revolving
Lender so notified fails to make available to Agent, for the
benefit of the applicable Issuer, the amount of such Lender’s
Revolving Commitment Percentage of such amount by 2:00 p.m. on
the Drawing Date, then interest shall accrue on such Lender’s
obligation to make such payment, from the Drawing Date to the date
on which such Lender makes such payment (i) at a rate per
annum equal to the Federal Funds Effective Rate during the first
three (3) days following the Drawing Date and (ii) at a rate per
annum equal to the rate applicable to Revolving Advances maintained
as a Domestic Rate Loan on and after the fourth day following the
Drawing Date. Agent and the applicable Issuer will promptly give
notice of the occurrence of the Drawing Date, but failure of Agent
or such Issuer to give any such notice on the Drawing Date or in
sufficient time to enable any Revolving Lender to effect such
payment on such date shall not relieve such Lender from its
obligations under this Section 2.14(c), provided that such Lender
shall not be obligated to pay interest as provided in this Section
2.14(c) until and commencing from the date of receipt of notice
from Agent or such Issuer of a drawing.

 

 

 

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(d) With respect to
any unreimbursed drawing that is not converted into a Revolving
Advance maintained as a Domestic Rate Loan to Borrowers in whole or
in part as contemplated by Section 2.14(b) hereof, for any reason,
Borrowers shall be deemed to have incurred from Agent a borrowing
(each a “Letter of Credit Borrowing”) in the amount of
such drawing. Such Letter of Credit Borrowing shall be due and
payable on demand (together with interest) and shall bear interest
at the rate per annum applicable to a Revolving Advance maintained
as a Domestic Rate Loan. Each applicable Lender’s payment to
Agent pursuant to Section 2.14(c) hereof shall be deemed to be a
payment in respect of its participation in such Letter of Credit
Borrowing and shall constitute a “Participation
Advance” from such Lender in satisfaction of its
Participation Commitment in respect of the applicable Letter of
Credit under this Section 2.14.

 

(e) Each
Lender’s Participation Commitment in respect of the Letters
of Credit shall continue until the last to occur of any of the
following events: (x) Issuers cease to be obligated to issue or
cause to be issued Letters of Credit hereunder; (y) no Letter of
Credit issued or created hereunder remains outstanding and
uncanceled; and (z) all Persons (other than Borrowers) have been
fully reimbursed for all payments made under or relating to Letters
of Credit.

 

2.15. Repayment of Participation
Advances.

 

(a) Upon (and only
upon) receipt by Agent for the account of Issuer of immediately
available funds from Borrowers (i) in reimbursement of any payment
made by Issuer or Agent under the Letter of Credit with respect to
which any Lender has made a Participation Advance to Agent, or (ii)
in payment of interest on such a payment made by Issuer or Agent
under such a Letter of Credit, Agent will pay to each Revolving
Lender, in the same funds as those received by Agent, the amount of
such Revolving Lender’s Revolving Commitment Percentage of
such funds, except Agent shall retain the amount of the Revolving
Commitment Percentage of such funds of any Revolving Lender that
did not make a Participation Advance in respect of such payment by
Agent (and, to the extent that any of the other Revolving Lenders
have funded any portion such Defaulting Lender’s
Participation Advance in accordance with the provisions of Section
2.22 hereof, Agent will pay over to such Non-Defaulting Lenders a
pro rata portion of the funds so withheld from such Defaulting
Lender).

 

(b) If Issuer or Agent
is required at any time to return to any Borrower, or to a trustee,
receiver, liquidator, custodian, or any official in any insolvency
proceeding, any portion of the payments made by Borrowers to Issuer
or Agent pursuant to Section 2.15(a) hereof in reimbursement of a
payment made under the Letter of Credit or interest or fee thereon,
each applicable Lender shall, on demand of Agent, forthwith return
to Issuer or Agent the amount of its Revolving Commitment
Percentage of any amounts so returned by Issuer or Agent plus
interest at the Federal Funds Effective Rate.

 

2.16. Documentation.
Each Borrower agrees to be bound by the terms of the Letter of
Credit Application and by Issuer’s interpretations of any
Letter of Credit issued on behalf of such Borrower and by
Issuer’s written regulations and customary practices relating
to letters of credit, though Issuer’s interpretations may be
different from such Borrower’s own. In the event of a
conflict between the Letter of Credit Application and this
Agreement, this Agreement shall govern. It is understood and agreed
that, except in the case of gross negligence or willful misconduct
(as determined by a court of competent jurisdiction in a final and
non-appealable judgment or order), Issuer shall not be liable for
any error, negligence and/or mistakes, whether of omission or
commission, in following Borrowing Agent’s or any
Borrower’s instructions or those contained in the Letters of
Credit or any modifications, amendments or supplements
thereto.

 

2.17. Determination to Honor Drawing
Request. In determining
whether to honor any request for drawing under any Letter of Credit
by the beneficiary thereof, Issuer shall be responsible only to
determine that the documents and certificates required to be
delivered under such Letter of Credit have been delivered and that
they comply on their face with the requirements of such Letter of
Credit and that any other drawing condition appearing on the face
of such Letter of Credit has been satisfied in the manner so set
forth.

 

 

 

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2.18. Nature
of Participation and Reimbursement Obligations. The obligation of
each Revolving Lender in accordance with this Agreement to make the
Revolving Advances or Participation Advances as a result of a
drawing under a Letter of Credit, and the obligations of Borrowers
to reimburse Issuer upon a draw under a Letter of Credit, shall be
absolute, unconditional and irrevocable, and shall be performed
strictly in accordance with the terms of this Section 2.18 under
all circumstances, including the following
circumstances:

 

(i) any set-off,
counterclaim, recoupment, defense or other right which such Lender
or any Borrower, as the case may be, may have against Issuer,
Agent, any Borrower or Lender, as the case may be, or any other
Person for any reason whatsoever;

 

(ii) the failure of any
Borrower or any other Person to comply, in connection with a Letter
of Credit Borrowing, with the conditions set forth in this
Agreement for the making of a Revolving Advance, it being
acknowledged that such conditions are not required for the making
of a Letter of Credit Borrowing and the obligation of Lenders to
make Participation Advances under Section 2.14 hereof;

 

(iii) any lack of
validity or enforceability of any Letter of Credit;

 

(iv) any claim of
breach of warranty that might be made by any Borrower, Agent,
Issuer or any Lender against the beneficiary of a Letter of Credit,
or the existence of any claim, set-off, recoupment, counterclaim,
cross-claim, defense or other right which any Borrower, Agent,
Issuer or any Lender may have at any time against a beneficiary,
any successor beneficiary or any transferee of any Letter of Credit
or assignee of the proceeds thereof (or any Persons for whom any
such transferee or assignee may be acting), Issuer, Agent or any
Lender or any other Person, whether in connection with this
Agreement, the transactions contemplated herein or any unrelated
transaction (including any underlying transaction between any
Borrower or any Subsidiaries of such Borrower and the beneficiary
for which any Letter of Credit was procured);

 

(v) the lack of power
or authority of any signer of (or any defect in or forgery of any
signature or endorsement on) or the form of or lack of validity,
sufficiency, accuracy, enforceability or genuineness of any draft,
demand, instrument, certificate or other document presented under
or in connection with any Letter of Credit, or any fraud or alleged
fraud in connection with any Letter of Credit, or the transport of
any property or provision of services relating to a Letter of
Credit, in each case even if Issuer or any of Issuer’s
Affiliates has been notified thereof;

 

(vi) payment by Issuer
under any Letter of Credit against presentation of a demand, draft
or certificate or other document which is forged or does not fully
comply with the terms of such Letter of Credit (provided that the
foregoing shall not excuse Issuer from any obligation under the
terms of any applicable Letter of Credit to require the
presentation of documents that on their face appear to satisfy any
applicable requirements for drawing under such Letter of Credit
prior to honoring or paying any such draw);

 

(vii) the solvency of,
or any acts or omissions by, any beneficiary of any Letter of
Credit, or any other Person having a role in any transaction or
obligation relating to a Letter of Credit, or the existence,
nature, quality, quantity, condition, value or other characteristic
of any property or services relating to a Letter of
Credit;

 

(viii) any failure by
Issuer or any of Issuer’s Affiliates to issue any Letter of
Credit in the form requested by Borrowing Agent, unless Agent and
Issuer have each received written notice from Borrowing Agent of
such failure within three (3) Business Days after Issuer shall have
provided Agent and Borrowing Agent a copy of such Letter of Credit
and such error is material and no drawing has been made thereon
prior to receipt of such notice;

 

(ix) the occurrence of
any Material Adverse Effect;

 

(x) any breach of this
Agreement or any Other Document by any party thereto;

 

 

 

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(xi) the occurrence or
continuance of an insolvency proceeding with respect to any Loan
Party;

 

(xii) the fact that a
Default or an Event of Default shall have occurred and be
continuing;

 

(xiii) the fact that the
Term shall have expired or this Agreement or the obligations of
Lenders to make Advances have been terminated; and

 

(xiv) any other
circumstance or happening whatsoever, whether or not similar to any
of the foregoing.

 

2.19. Liability for Acts and
Omissions.

 

(a) As between
Borrowers and Issuer, Swing Loan Lender, Agent and Lenders, each
Borrower assumes all risks of the acts and omissions of, or misuse
of the Letters of Credit by, the respective beneficiaries of such
Letters of Credit. In furtherance and not in limitation of the
foregoing, Issuer shall not be responsible for: (i) the form,
validity, sufficiency, accuracy, genuineness or legal effect of any
document submitted by any party in connection with the application
for an issuance of any such Letter of Credit, even if it should in
fact prove to be in any or all respects invalid, insufficient,
inaccurate, fraudulent or forged (even if Issuer or any of its
Affiliates shall have been notified thereof); (ii) the validity or
sufficiency of any instrument transferring or assigning or
purporting to transfer or assign any such Letter of Credit or the
rights or benefits thereunder or proceeds thereof, in whole or in
part, which may prove to be invalid or ineffective for any reason;
(iii) the failure of the beneficiary of any such Letter of Credit,
or any other party to which such Letter of Credit may be
transferred, to comply fully with any conditions required in order
to draw upon such Letter of Credit or any other claim of any
Borrower against any beneficiary of such Letter of Credit, or any
such transferee, or any dispute between or among any Borrower and
any beneficiary of any Letter of Credit or any such transferee;
(iv) errors, omissions, interruptions or delays in transmission or
delivery of any messages, by mail, cable, facsimile or otherwise,
whether or not they be in cipher; (v) errors in interpretation
of technical terms; (vi) any loss or delay in the transmission or
otherwise of any document required in order to make a drawing under
any such Letter of Credit or of the proceeds thereof; (vii) the
misapplication by the beneficiary of any such Letter of Credit of
the proceeds of any drawing under such Letter of Credit; or (viii)
any consequences arising from causes beyond the control of Issuer,
including any Governmental Acts, and none of the above shall affect
or impair, or prevent the vesting of, any of Issuer’s rights
or powers hereunder. Nothing in the preceding sentence shall
relieve Issuer from liability for Issuer’s gross negligence
or willful misconduct (as determined by a court of competent
jurisdiction in a final and non-appealable judgment or order) in
connection with actions or omissions described in such clauses
(i) through (viii) of such sentence. In no event shall Issuer
or Issuer’s Affiliates be liable to any Borrower for any
indirect, consequential, incidental, punitive, exemplary or special
damages or expenses (including without limitation attorneys’
fees), or for any damages resulting from any change in the value of
any property relating to a Letter of Credit.

 

(b) Without limiting
the generality of the foregoing, Issuer and each of its Affiliates:
(i) may rely on any oral or other communication believed in good
faith by Issuer or such Affiliate to have been authorized or given
by or on behalf of the applicant for a Letter of Credit; (ii) may
honor any presentation if the documents presented appear on their
face substantially to comply with the terms and conditions of the
relevant Letter of Credit; (iii) may honor a previously dishonored
presentation under a Letter of Credit, whether such dishonor was
pursuant to a court order, to settle or compromise any claim of
wrongful dishonor, or otherwise, and shall be entitled to
reimbursement to the same extent as if such presentation had
initially been honored, together with any interest paid by Issuer
or its Affiliates; (iv) may honor any drawing that is payable upon
presentation of a statement advising negotiation or payment, upon
receipt of such statement (even if such statement indicates that a
draft or other document is being delivered separately), and shall
not be liable for any failure of any such draft or other document
to arrive, or to conform in any way with the relevant Letter of
Credit; (v) may pay any paying or negotiating bank claiming that it
rightfully honored under the laws or practices of the place where
such bank is located; and (vi) may settle or adjust any claim or
demand made on Issuer or its Affiliate in any way related to any
order issued at the applicant’s request to an air carrier, a
letter of guarantee or of indemnity issued to a steamship agent or
carrier or any document or instrument of like import (each an
“Order”) and honor any drawing in connection with any
Letter of Credit that is the subject of such Order, notwithstanding
that any drafts or other documents presented in connection with
such Letter of Credit fail to conform in any way with such Letter
of Credit.

 

 

 

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(c) In furtherance and
extension and not in limitation of the specific provisions set
forth above, any action taken or omitted by Issuer under or in
connection with the Letters of Credit issued by it or any documents
and certificates delivered thereunder, if taken or omitted in good
faith and without gross negligence (as determined by a court of
competent jurisdiction in a final and non-appealable judgment or
order), shall not put Issuer under any resulting liability to any
Borrower, Agent or any Lender.

 

2.20. Mandatory
Prepayments.

 

(a) Subject to Section
7.1 hereof, upon the receipt by any Loan Party of the proceeds of
any sale or other disposition of any Collateral (other than in the
Ordinary Course of Business), Borrowers shall prepay the Advances
in an amount equal to the Net Cash Proceeds of such sale or other
disposition, such prepayments to be made promptly but in no event
more than one (1) Business Day following receipt of such Net Cash
Proceeds, and until the date of payment, such proceeds shall be
held in trust for Agent. The foregoing shall not be deemed to be
implied consent to any such sale or other disposition otherwise
prohibited by the terms and conditions hereof. Such prepayments
shall be applied to the principal amount of the Advances (including
cash collateralization of all Obligations relating to any
outstanding Letters of Credit in accordance with the provisions of
Section 3.2(b); provided however that if no Default or Event of
Default has occurred and is continuing, such prepayments shall be
applied to cash collateralize any Obligations related to
outstanding Letters of Credit last), subject to Borrowers’
ability to re-borrow Revolving Advances in accordance with the
terms hereof.

 

(b) In the event of
any issuance or other incurrence of Indebtedness (other than
Permitted Indebtedness) by the Loan Parties or the issuance of any
Equity Interests by any Loan Party, the Borrowers shall, no later
than one (1) Business Day after the receipt by such Loan Party of
(i) the Net Cash Proceeds from any such issuance or incurrence of
Indebtedness or (ii) the Net Cash Proceeds of any issuance of
Equity Interests, as applicable, prepay the Advances in an amount
equal to (x) one hundred percent (100%) of such Net Cash Proceeds
in the case of such incurrence or issuance of Indebtedness and (y)
one hundred percent (100%) of such Net Cash Proceeds in the case of
an issuance of Equity Interests. Such prepayments will be applied
in the same manner as set forth in Section 2.20(a)
hereof.

 

(c) All proceeds
received by Borrowers or Agent (i) under any insurance policy on
account of damage or destruction of any assets or property of any
Borrowers, or (ii) as a result of any taking or condemnation of any
assets or property shall be applied in accordance with
Section 6.6 hereof.

 

(d) Borrowers may, at
any time and from time to time, prepay the principal of any
Revolving Advances, in whole or in part, without premium or
penalty.

 

2.21. Use of Proceeds.

 

(a) Borrowers shall
apply the proceeds of Advances to (i) pay fees and expenses
relating to the Transactions and (ii) provide for their working
capital needs, fund Capital Expenditures and reimburse drawings
under Letters of Credit.

 

(b) Without limiting
the generality of Section 2.21(a) above, neither the Loan Parties
nor any other Person which may in the future become party to this
Agreement or the Other Documents as a Loan Party, intends to use
nor shall they use any portion of the proceeds of the Advances,
directly or indirectly, for any purpose in violation of Applicable
Law.

 

 

 

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2.22. Defaulting
Lender.

 

(a) Notwithstanding
anything to the contrary set forth herein, in the event any Lender
is a Defaulting Lender, all rights and obligations hereunder of
such Defaulting Lender and of the other parties hereto shall be
modified to the extent of the express provisions of this
Section 2.22 so long as such Lender is a Defaulting
Lender.

 

(b) Except as
otherwise expressly provided for in this Section 2.22, Revolving
Advances shall be made pro rata from Revolving Lenders which are
not Defaulting Lenders based on their respective Revolving
Commitment Percentages, and no Revolving Commitment Percentage of
any Lender or any pro rata share of any Revolving Advances required
to be advanced by any Lender shall be increased as a result of any
Lender being a Defaulting Lender. Amounts received in respect of
principal of any type of Revolving Advances shall be applied to
reduce such type of Revolving Advances of each Revolving Lender
(other than any Defaulting Lender) in accordance with their
Revolving Commitment Percentages; provided, that, Agent shall not
be obligated to transfer to a Defaulting Lender any payments
received by Agent for Defaulting Lender’s benefit, nor shall
a Defaulting Lender be entitled to the sharing of any payments
hereunder (including any principal, interest or fees). Amounts
payable to a Defaulting Lender shall instead be paid to or retained
by Agent. Agent may hold and, in its discretion, re-lend to a
Borrower the amount of such payments received or retained by it for
the account of such Defaulting Lender.

 

(i) Fees pursuant to
Section 3.3(b) hereof shall cease to accrue in favor of such
Defaulting Lender.

 

(ii) If any Swing Loans
are outstanding or any Letters of Credit (or drawings under any
Letter of Credit for which Issuer has not been reimbursed) are
outstanding or exist at the time any such Revolving Lender becomes
a Defaulting Lender, then:

 

(A) Defaulting
Lender’s Participation Commitment in the outstanding Swing
Loans and of the Maximum Undrawn Amount of all outstanding Letters
of Credit shall be reallocated among Revolving Lenders which are
Non-Defaulting Lenders in proportion to the respective Revolving
Commitment Percentages of such Non-Defaulting Lenders to the extent
(but only to the extent) that (x) such reallocation does not cause
the aggregate sum of outstanding Revolving Advances made by any
such Revolving Lender that is a Non-Defaulting Lender plus such
Revolving Lender’s reallocated Participation Commitment in
the outstanding Swing Loans plus such Lender’s reallocated
Participation Commitment in the aggregate Maximum Undrawn Amount of
all outstanding Letters of Credit to exceed the Revolving
Commitment Amount of any such Non-Defaulting Lender, and (y) no
Default or Event of Default has occurred and is continuing at such
time;

 

(B) if the
reallocation described in clause (A) above cannot, or can only
partially, be effected, Borrowers shall within one Business Day
following notice by Agent (x) first, prepay any outstanding Swing
Loans that cannot be reallocated, and (y) second, cash
collateralize for the benefit of Issuer, Borrowers’
obligations corresponding to such Defaulting Lender’s
Participation Commitment in the Maximum Undrawn Amount of all
Letters of Credit (after giving effect to any partial reallocation
pursuant to clause (A) above) in accordance with Section 3.2(b)
hereof for so long as such Obligations are
outstanding;

 

(C) if Borrowers cash
collateralize any portion of such Defaulting Lender’s
Participation Commitment in the Maximum Undrawn Amount of all
Letters of Credit pursuant to clause (B) above, Borrowers shall not
be required to pay any fees to such Defaulting Lender pursuant to
Section 3.2(a) hereof with respect to such Defaulting
Lender’s Revolving Commitment Percentage of Maximum Undrawn
Amount of all Letters of Credit during the period such Defaulting
Lender’s Participation Commitment in the Maximum Undrawn
Amount of all Letters of Credit are cash
collateralized;

 

 

 

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(D) if Defaulting
Lender’s Participation Commitment in the Maximum Undrawn
Amount of all Letters of Credit is reallocated pursuant to clause
(A) above, then the fees payable to Revolving Lenders pursuant to
Section 3.2(a) hereof shall be adjusted and reallocated to
Revolving Lenders which are Non-Defaulting Lenders in accordance
with such reallocation; and

 

(E) if all or any
portion of such Defaulting Lender’s Participation Commitment
in the Maximum Undrawn Amount of all Letters of Credit is neither
reallocated nor cash collateralized pursuant to clauses (A) or (B)
above, then, without prejudice to any rights or remedies of Issuer
or any other Lender hereunder, all Letter of Credit Fees payable
under Section 3.2(a) hereof with respect to such Defaulting
Lender’s Revolving Commitment Percentage of the Maximum
Undrawn Amount of all Letters of Credit shall be payable to the
Issuer (and not to such Defaulting Lender) until (and then only to
the extent that) such Participation Commitment in the Maximum
Undrawn Amount of all Letters of Credit is reallocated and/or cash
collateralized; and

 

(F) so long as any
Revolving Lender is a Defaulting Lender, Swing Loan Lender shall
not be required to fund any Swing Loans and Issuer shall not be
required to issue, amend or increase any Letter of Credit, unless
such Issuer is satisfied that the related exposure and Defaulting
Lender’s Participation Commitment in the Maximum Undrawn
Amount of all Letters of Credit and all Swing Loans (after giving
effect to any such issuance, amendment, increase or funding) will
be fully allocated to Revolving Lenders which are Non-Defaulting
Lenders and/or cash collateral for such Letters of Credit will be
provided by Borrowers in accordance with clause (A) and (B) above,
and participating interests in any newly made Swing Loan or any
newly issued or increased Letter of Credit shall be allocated among
Non-Defaulting Lenders in a manner consistent with Section
2.22(b)(iii)(A) above (and such Defaulting Lender shall not
participate therein).

 

(c) A Defaulting
Lender shall not be entitled to give instructions to Agent or to
approve, disapprove, consent to or vote on any matters relating to
this Agreement and the Other Documents, and all amendments, waivers
and other modifications of this Agreement and the Other Documents
may be made without regard to a Defaulting Lender and, for purposes
of the definition of “Required Lenders”, a Defaulting
Lender shall not be deemed to be a Lender, to have any outstanding
Advances or a Revolving Commitment Percentage provided, that this
clause (c) shall not apply to the vote of a Defaulting Lender
in the case of an amendment, waiver or other modification described
in clauses (i) or (ii) of Section 16.2(b) hereof.

 

(d) Other than as
expressly set forth in this Section 2.22, the rights and
obligations of a Defaulting Lender (including the obligation to
indemnify Agent) and the other parties hereto shall remain
unchanged. Nothing in this Section 2.22 shall be deemed to release
any Defaulting Lender from its obligations under this Agreement and
the Other Documents, shall alter such obligations, shall operate as
a waiver of any default by such Defaulting Lender hereunder, or
shall prejudice any rights which any Borrower, Agent or any Lender
may have against any Defaulting Lender as a result of any default
by such Defaulting Lender hereunder.

 

(e) In the event that
Agent, Borrowers, Swing Loan Lender and Issuer agree in writing
that a Defaulting Lender has adequately remedied all matters that
caused such Lender to be a Defaulting Lender, then Agent will so
notify the parties hereto, and, if such cured Defaulting Lender is
a Revolving Lender, then Participation Commitments of Revolving
Lenders (including such cured Defaulting Lender) of the Swing Loans
and Maximum Undrawn Amount of all outstanding Letters of Credit
shall be reallocated to reflect the inclusion of such
Lender’s Revolving Commitment, and on such date such Lender
shall purchase at par such of the Revolving Advances of the other
Lenders as Agent shall determine may be necessary in order for such
Lender to hold such Revolving Advances in accordance with its
Revolving Commitment Percentage.

 

 

 

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(f) If Swing Loan
Lender or Issuer has a good faith belief that any Revolving Lender
has defaulted in fulfilling its obligations under one or more other
agreements in which such Lender commits to extend credit, Swing
Loan Lender shall not be required to fund any Swing Loans and
Issuer shall not be required to issue, amend or increase any Letter
of Credit, unless Swing Loan Lender or Issuer, as the case may be,
shall have entered into arrangements with Borrowers or such Lender,
satisfactory to Swing Loan Lender or Issuer, as the case may be, to
defease any risk to it in respect of such Lender
hereunder.

 

2.23. Payment of
Obligations. Agent may charge
to Borrowers’ Account as a Revolving Advance or, at the
discretion of Swing Loan Lender, as a Swing Loan (i) all payments
with respect to any of the Obligations required hereunder
(including without limitation principal payments, payments of
interest, payments of Letter of Credit Fees and all other fees
provided for hereunder and payments under Sections 16.5 and 16.9
hereof) as and when each such payment shall become due and payable
(whether as regularly scheduled, upon or after acceleration, upon
maturity or otherwise, but only after giving effect to any cure
period therefor), (ii) without limiting the generality of the
foregoing clause (i), (a) all amounts expended by Agent or any
Lender pursuant to Sections 4.2 or 4.3 hereof and (b) all expenses
which Agent incurs in connection with the forwarding of Advance
proceeds and the establishment and maintenance of any Blocked
Accounts or Depository Accounts as provided for in Section 4.8(h)
hereof, and (iii) any sums expended by Agent or any Lender due to
any Loan Party’s failure to perform or comply with its
obligations under this Agreement or any Other Document including
any Loan Party’s obligations under Sections 3.3, 6.4, 6.6,
6.7 and 6.8 hereof, and all amounts so charged shall be added to
the Obligations and shall be secured by the Collateral. To the
extent Revolving Advances are not actually funded by the other
Lenders in respect of any such amounts so charged, all such amounts
so charged shall be deemed to be Revolving Advances made by and
owing to Agent and Agent shall be entitled to all rights (including
accrual of interest) and remedies of a Lender under this Agreement
and the Other Documents with respect to such Revolving
Advances.

 

III. INTEREST AND
FEES.

 

3.1. Interest. Interest on
Advances shall be payable in arrears (a) on the first Business Day
of each month with respect to Domestic Rate Loans and (b) with
respect to LIBOR Rate Loans having an Interest Period of one, two
or three months, at the end of the applicable Interest Period,
provided that all accrued and unpaid interest shall be due and
payable at the end of the Term. Interest charges shall be computed
on the actual principal amount of Advances outstanding during the
applicable month at a rate per annum equal to (i) with respect
to Revolving Advances, the applicable Revolving Interest Rate, and
(ii) with respect to Swing Loans, the Revolving Interest Rate for
Domestic Rate Loans, (as applicable, the “Contract
Rate”). Except as expressly provided otherwise in this
Agreement, any Obligations other than the Advances that are not
paid when due (after giving effect to any applicable grace period)
shall accrue interest at the Revolving Interest Rate for Domestic
Rate Loans, subject to the provision of the final sentence of this
Section 3.1 regarding the Default Rate. Whenever, subsequent to the
Closing Date, the Alternate Base Rate is increased or decreased,
the applicable Contract Rate shall be similarly changed without
notice or demand of any kind by an amount equal to the amount of
such change in the Alternate Base Rate during the time such change
or changes remain in effect. The LIBOR Rate shall be adjusted with
respect to LIBOR Rate Loans without notice or demand of any kind on
the effective date of any change in the Reserve Percentage as of
such effective date. Upon and after the occurrence of an Event of
Default, and during the continuation thereof, at the option of
Agent or at the direction of Required Lenders (or, in the case of
any Event of Default under Section 10.7 hereof, immediately and
automatically upon the occurrence of any such Event of Default
without the requirement of any affirmative action by any party),
the Obligations shall bear interest at the applicable Contract Rate
plus two percent (2%) per annum (as applicable, the
“Default
Rate”).

 

 

 

-45-

 

 

3.2. Letter
of Credit Fees.

 

(a) Borrowers shall pay
(x) to Agent, for the ratable benefit of Revolving Lenders, fees
for each outstanding Letter of Credit for the period from and
excluding the date of issuance of same to and including the date of
expiration or termination, equal to the aggregate daily undrawn
face amount of all outstanding Letters of Credit multiplied by the
Applicable Margin for Revolving Advances consisting of LIBOR Rate
Loans, such fees to be calculated on the basis of a 360-day year
for the actual number of days elapsed and to be payable quarterly
in arrears on the first day of each calendar quarter and on the
last day of the Term, and (y) to Issuer, a fronting fee of one
quarter of one percent (0.25%) per annum times the aggregate daily
undrawn face amount of all outstanding Letters of Credit for the
period from and excluding the date of issuance of same to and
including the date of expiration or termination, to be payable
quarterly in arrears on the first day of each calendar quarter and
on the last day of the Term (all of the foregoing fees, the
“Letter of Credit Fees”). In addition, Borrowers shall
pay to Agent, for the benefit of Issuer, any and all
administrative, issuance, amendment, payment and negotiation
charges with respect to Letters of Credit and all fees and expenses
as agreed upon by Issuer and Borrowing Agent in connection with any
Letter of Credit, including in connection with the opening,
amendment or renewal of any such Letter of Credit and any
acceptances created thereunder, all such charges, fees and
expenses, if any, to be payable on demand. All such charges shall
be deemed earned in full on the date when the same are due and
payable hereunder and shall not be subject to rebate or pro-ration
upon the termination of this Agreement for any reason. Any such
charge in effect at the time of a particular transaction shall be
the charge for that transaction, notwithstanding any subsequent
change in Issuer’s prevailing charges for that type of
transaction. Upon and after the occurrence of an Event of Default,
and during the continuation thereof, at the option of Agent or at
the direction of Required Lenders (or, in the case of any Event of
Default under Section 10.7 hereof, immediately and automatically
upon the occurrence of any such Event of Default without the
requirement of any affirmative action by any party), the Letter of
Credit Fees described in clause (x) of this Section 3.2(a)
shall be increased by an additional two percent (2.0%) per
annum.

 

(b) At any time
following the occurrence and during the continuance of an Event of
Default, at the option of Agent or at the direction of Required
Lenders (or, in the case of any Event of Default under Section 10.7
hereof, immediately and automatically upon the occurrence of such
Event of Default, without the requirement of any affirmative action
by any party), or on the last day of the Term or any other
termination of this Agreement (and also, if applicable, in
connection with any mandatory prepayment under Section 2.20
hereof), Borrowers will cause cash to be deposited and maintained
in an account with Agent, as cash collateral, in an amount equal to
one hundred and five percent (105%) of the Maximum Undrawn Amount
of all outstanding Letters of Credit, and each Borrower hereby
irrevocably authorizes Agent, in its discretion, on such
Borrower’s behalf and in such Borrower’s name, to open
such an account and to make and maintain deposits therein, or in an
account opened by such Borrower, in the amounts required to be made
by such Borrower, out of the proceeds of Receivables or other
Collateral or out of any other funds of such Borrower coming into
any Lender’s possession at any time. Agent may, in its
discretion, invest such cash collateral (less applicable reserves)
in such short-term money-market items as to which Agent and such
Borrower mutually agree (or, in the absence of such agreement,
as Agent may reasonably select) and the net return on such
investments shall be credited to such account and constitute
additional cash collateral, or Agent may (notwithstanding the
foregoing) establish the account provided for under this Section
3.2(b) as a non-interest bearing account and in such case Agent
shall have no obligation (and Borrowers hereby waive any claim)
under Article 9 of the Uniform Commercial Code or under any other
Applicable Law to pay interest on such cash collateral being held
by Agent. No Borrower may withdraw amounts credited to any such
account except upon the occurrence of all of the following:
(x) Payment in Full of all of the Obligations; (y) expiration
of all Letters of Credit; and (z) termination of the Commitments
and of this Agreement. Borrowers hereby assign, pledge and grant to
Agent, for its benefit and the ratable benefit of Issuer, Lenders
and each other Secured Party, a continuing security interest in and
to and Lien on any such cash collateral and any right, title and
interest of Borrowers in any deposit account, securities account or
investment account into which such cash collateral may be deposited
from time to time to secure the Obligations, specifically including
all Obligations with respect to any Letters of Credit. Borrowers
agree that upon the coming due of any Reimbursement Obligations (or
any other Obligations, including Obligations for Letter of Credit
Fees) with respect to the Letters of Credit, Agent may use such
cash collateral to pay and satisfy such Obligations.

 

 

 

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3.3. Fee
Letter and Facility Fee.

 

(a) Borrowers shall
pay the amounts required to be paid in the Fee Letter in the manner
and on the dates required by the Fee Letter.

 

(b) If, for any day in
each calendar quarter during the Term, the daily unpaid balance of
the sum of Revolving Advances plus Swing Loans plus the Maximum Undrawn
Amount of all outstanding Letters of Credit (the
“Usage
Amount”) for each day of such calendar quarter does
not equal the Maximum Revolving Advance Amount, then Borrowers
shall pay to Agent, for the ratable benefit of Revolving Lenders
based on their Revolving Commitment Percentages, a fee at a rate
equal to the Applicable Facility Fee Percentage per annum on the
amount by which the Maximum Revolving Advance Amount on such day
exceeds such Usage Amount (the “Facility Fee”). The
Facility Fee shall be payable to Agent in arrears on the first
Business Day of each calendar quarter with respect to each day in
the previous calendar quarter and on the last day of the Term with
respect to the period ending on the last day of the
Term.

 

3.4. Reserved.

 

3.5. Computation of Interest and
Fees. Interest and fees
hereunder shall be computed on the basis of a year of 360 days and
for the actual number of days elapsed. If any payment to be made
hereunder becomes due and payable on a day other than a Business
Day, the due date thereof shall be extended to the next succeeding
Business Day and interest thereon shall be payable.

 

3.6. Maximum
Charges. In no event
whatsoever shall interest and other charges charged hereunder
exceed the highest rate permissible under Applicable Law. In the
event interest and other charges as computed hereunder would
otherwise exceed the highest rate permitted under Applicable Law:
(a) the interest rates hereunder will be reduced to the maximum
rate permitted under Applicable Law; (b) such excess amount shall
be first applied to any unpaid principal balance owed by Borrowers;
and (c) if then remaining excess amount is greater than the
previously unpaid principal balance, Lenders shall promptly refund
such excess amount to Borrowers and the provisions hereof shall be
deemed amended to provide for such permissible rate.

 

3.7. Increased
Costs. In the event that
any Change in Law or compliance by any Lender (for purposes of this
Section 3.7, the term “Lender” shall include Agent,
Swing Loan Lender, any Issuer or Lender and any corporation or bank
controlling Agent, Swing Loan Lender, any Lender or Issuer and the
office or branch where Agent, Swing Loan Lender, any Lender or
Issuer (as so defined) makes or maintains any LIBOR Rate Loans)
with any request or directive (whether or not having the force of
law) from any central bank or other financial, monetary or other
authority, shall:

 

(a) subject Agent,
Swing Loan Lender, any Lender, any Issuer or any other recipient to
any Tax (other than Indemnified Taxes and Excluded Taxes) on the
Advances, this Agreement, any Letter of Credit, any Commitments or
other Obligations, or its deposits, reserves, other liabilities or
capital attributable thereto;

 

(b) impose, modify or
deem applicable any reserve, special deposit, assessment,
compulsory loan, insurance charge or similar requirement against
assets held by, or deposits in or for the account of, advances or
loans by, or other credit extended by, any office of Agent, Swing
Loan Lender, Issuer or any Lender, including pursuant to Regulation
D of the Board of Governors of the Federal Reserve System;
or

 

 

 

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(c) impose on Agent,
Swing Loan Lender, any Lender or Issuer or the London interbank
market any other condition, loss or expense (other than Taxes)
affecting this Agreement or any Other Document or any Advance made
by any Lender, or any Letter of Credit or participation
therein; and the result of
any of the foregoing is to increase the cost to Agent, Swing Loan
Lender, any Lender or Issuer of making, converting to, continuing,
renewing or maintaining its Advances hereunder by an amount that
Agent, Swing Loan Lender, such Lender or Issuer deems to be
material or to reduce the amount of any payment (whether of
principal, interest or otherwise) in respect of any of the Advances
by an amount that Agent, Swing Loan Lender or such Lender or Issuer
deems to be material, then, in any case Borrowers shall promptly
pay Agent, Swing Loan Lender, such Lender or Issuer, upon its
demand, such additional amount as will compensate Agent, Swing Loan
Lender or such Lender or Issuer for such additional cost or such
reduction, as the case may be, provided that the foregoing shall
not apply to increased costs which are reflected in the LIBOR Rate,
as the case may be. Agent, Swing Loan Lender, such Lender or Issuer
shall certify the amount of such additional cost or reduced amount
to Borrowing Agent, and such certification shall be conclusive
absent manifest error. Failure or delay on the part of Agent, Swing
Loan Lender, any Lender or Issuer to demand compensation pursuant
to this Section shall not constitute a waiver of such
Person’s right to demand such compensation; provided that
Borrowers shall not be required to compensate a Person pursuant to
this Section for any increased costs incurred or reductions
suffered more than six months prior to the date that such Person
notifies Borrower Agent of the Change in Law giving rise to such
increased costs or reductions, and of such Person’s intention
to claim compensation therefor (except that, if the Change in Law
giving rise to such increased costs or reductions is retroactive,
then the six-month period referred to above shall be extended to
include the period of retroactive effect thereof).

 

3.8. Alternative Rate of
Interest

 

3.8.1 Basis for Determining Interest Rate
Inadequate or Unfair. In the event that Agent or Required
Lenders shall have determined that:

 

(a) reasonable means
do not exist for ascertaining the LIBOR Rate applicable pursuant to
Section 2.2 hereof for any Interest Period;

 

(b) Dollar deposits in
the relevant amount and for the relevant maturity are not available
in the London interbank market, with respect to an outstanding
LIBOR Rate Loan, a proposed LIBOR Rate Loan, or a proposed
conversion of a Domestic Rate Loan into a LIBOR Rate
Loan;

 

(c) the making,
maintenance or funding of any LIBOR Rate Loan has been made
impracticable or unlawful by compliance by Agent or such Lenders in
good faith with any Applicable Law or any interpretation or
application thereof by any Governmental Body or with any request or
directive of any such Governmental Body (whether or not having the
force of law); or

 

(d) the LIBOR Rate
will not adequately and fairly reflect the cost to such Lenders of
the establishment or maintenance of any LIBOR Rate Loan,
then Agent shall
give Borrowing Agent prompt written or telephonic notice of such
determination. If such notice is given prior to a LIBOR Termination
Date (as defined below) or prior to the date on which Section
3.8.2(a)(ii) hereof applies, (i) any such requested LIBOR Rate Loan
shall be made as a Domestic Rate Loan, unless Borrowing Agent shall
notify Agent no later than 3:00 p.m. two (2) Business Days prior to
the date of such proposed borrowing, that its request for such
borrowing shall be cancelled or made as an unaffected type of LIBOR
Rate Loan, (ii) any Domestic Rate Loan or LIBOR Rate Loan which was
to have been converted to an affected type of LIBOR Rate Loan shall
be continued as or converted into a Domestic Rate Loan, or, if
Borrowing Agent shall notify Agent, no later than 3:00 p.m. two (2)
Business Days prior to the proposed conversion, shall be maintained
as an unaffected type of LIBOR Rate Loan, and (iii) any
outstanding affected LIBOR Rate Loans shall be converted into a
Domestic Rate Loan, or, if Borrowing Agent shall notify Agent, no
later than 3:00 p.m. two (2) Business Days prior to the last
Business Day of the then current Interest Period applicable to such
affected LIBOR Rate Loan, shall be converted into an unaffected
type of LIBOR Rate Loan, on the last Business Day of the then
current Interest Period for such affected LIBOR Rate Loans (or
sooner, if any Lender cannot continue to lawfully maintain such
affected LIBOR Rate Loan). Until such notice has been withdrawn,
Lenders shall have no obligation to make an affected type of LIBOR
Rate Loan or maintain outstanding affected LIBOR Rate Loans and no
Borrower shall have the right to convert a Domestic Rate Loan or an
unaffected type of LIBOR Rate Loan into an affected type of LIBOR
Rate Loan.

 

 

 

 

 

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3.8.2                      Successor
LIBOR Rate Index.

 

(a)           If
Agent determines (which determination shall be final and
conclusive, absent manifest error) that either (i) (A) the
circumstances set forth in Section 3.8.1(a) hereof have arisen and
are unlikely to be temporary, or (B) the circumstances set forth in
Section 3.8.1(a) hereof have not arisen but the applicable
supervisor or administrator (if any) of the LIBOR Rate or a
Governmental Body having jurisdiction over Agent has made a public
statement identifying the specific date after which the LIBOR Rate
shall no longer be used for determining interest rates for loans
(either such date, a “LIBOR Termination Date”),
or (ii) a rate other than the LIBOR Rate has become a widely
recognized benchmark rate for newly originated loans in Dollars in
the U.S. market, then Agent may (in consultation with the Borrower)
choose a replacement index for the LIBOR Rate and make adjustments
to applicable margins and related amendments to this Agreement as
referred to below such that, to the extent practicable, the all-in
interest rate based on the replacement index will be substantially
equivalent to the all-in LIBOR Rate-based interest rate in effect
prior to its replacement.

 

(b)       
Agent and the Loan Parties shall enter into an amendment to this
Agreement to reflect the replacement index, the adjusted margins
and such other related amendments as may be appropriate, in the
discretion of Agent, for the implementation and administration of
the replacement index-based rate. Notwithstanding anything to the
contrary in this Agreement or the Other Documents (including,
without limitation, Section 16.2 hereof), such amendment shall
become effective without any further action or consent of any other
party to this Agreement at 5:00 p.m. on the tenth (10th) Business Day after
the date a draft of the amendment is provided to the Lenders,
unless Agent receives, on or before such tenth (10th) Business Day, a
written notice from the Required Lenders stating that such Lenders
object to such amendment. 

 

(c)       
Selection of the replacement index, adjustments to the applicable
margins, and amendments to this Agreement (i) will be determined
with due consideration to the then-current market practices for
determining and implementing a rate of interest for newly
originated loans in the United States and loans converted from a
LIBOR Rate-based rate to a replacement index-based rate, and (ii)
may also reflect adjustments to account for (x) the effects of the
transition from the LIBOR Rate to the replacement index and (y)
yield- or risk-based differences between the LIBOR Rate and the
replacement index.

 

(d)        
Until an amendment reflecting a new replacement index in accordance
with this Section 3.8.2 is effective, each advance, conversion and
renewal of a LIBOR Rate Loan will continue to bear interest with
reference to the LIBOR Rate; provided however, that if the
Administrative Agent determines (which determination shall be final
and conclusive, absent manifest error) that a LIBOR Termination
Date has occurred, then following the LIBOR Termination Date, all
LIBOR Rate Loans shall automatically be converted to Domestic Rate
Loans until such time as an amendment reflecting a replacement
index and related matters as described above is
implemented.

 

(e)        
Notwithstanding anything to the contrary contained herein, if at
any time the replacement index is less than zero, at such times,
such index shall be deemed to be zero for purposes of this
Agreement.

 

 

 

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3.9. Capital Adequacy.

(a) In the event that
Agent, Swing Loan Lender, any Issuer or any Lender shall have
determined that any Applicable Law or guideline regarding capital
adequacy, or any Change in Law or any change in the interpretation
or administration thereof by any Governmental Body, central bank or
comparable agency charged with the interpretation or administration
thereof, or compliance by Agent, Swing Loan Lender, any Issuer or
any Lender (for purposes of this Section 3.9, the term
“Lender” shall include Agent, Swing Loan Lender, any
Issuer or any Lender and any corporation or bank controlling Agent,
Swing Loan Lender, any Issuer or any Lender and the office or
branch where Agent, Swing Loan Lender, any Issuer or any Lender (as
so defined) makes or maintains any LIBOR Rate Loans) with any
request or directive regarding capital adequacy (whether or not
having the force of law) of any such authority, central bank or
comparable agency, has or would have the effect of reducing the
rate of return on Agent, Swing Loan Lender, any Issuer or any
Lender’s capital as a consequence of its obligations
hereunder (including the making of any Swing Loans) to a level
below that which Agent, Swing Loan Lender, such Issuer or such
Lender could have achieved but for such adoption, change or
compliance (taking into consideration Agent’s, Swing Loan
Lender’s, such Issuer’s and such Lender’s
policies with respect to capital adequacy) by an amount deemed by
Agent, Swing Loan Lender, any Issuer or any Lender to be material,
then, from time to time, Borrowers shall pay upon demand to Agent,
Swing Loan Lender, such Issuer or such Lender such additional
amount or amounts as will compensate Agent, Swing Loan Lender, such
Issuer or such Lender for such reduction. In determining such
amount or amounts, Agent, Swing Loan Lender, such Issuer or such
Lender may use any reasonable averaging or attribution methods. The
protection of this Section 3.9 shall be available to Agent,
Swing Loan Lender, each Issuer and each Lender regardless of any
possible contention of invalidity or inapplicability with respect
to the Applicable Law, rule, regulation, guideline or
condition.

 

(b) A certificate of
Agent, Swing Loan Lender, such Issuer or such Lender setting forth
such amount or amounts as shall be necessary to compensate Agent,
Swing Loan Lender, such Issuer or such Lender with respect to
Section 3.9(a) hereof when delivered to Borrowing Agent shall be
conclusive absent manifest error. Failure or delay on the part of
Agent, Swing Loan Lender, any Lender or Issuer to demand
compensation pursuant to this Section shall not constitute a waiver
of such Person’s right to demand such compensation; provided
that Borrowers shall not be required to compensate a Person
pursuant to this Section for any increased costs incurred or
reductions suffered more than six months prior to the date that
such Person notifies Borrower Agent of the Change in Law giving
rise to such increased costs or reductions, and of such
Person’s intention to claim compensation therefor (except
that, if the Change in Law giving rise to such increased costs or
reductions is retroactive, then the six-month period referred to
above shall be extended to include the period of retroactive effect
thereof).

 

3.10. Taxes.

 

(a) Defined Terms. For purposes of
this Section 3.10, the term “Lender” includes any
Issuer, Swing Loan Lender or any Participant and the term
“Applicable Law” includes FATCA.

 

 

 

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(b) Payment Free of Taxes. Any and
all payments by or on account of any Obligations of any Loan Party
under this Agreement or any Other Document shall be made without
deduction or withholding for any Taxes, except as required by
Applicable Law. If any Applicable Law (as determined in the good
faith discretion of an applicable Withholding Agent) requires the
deduction or withholding of any Tax from any such payment by a
Withholding Agent, then the applicable Withholding Agent shall be
entitled to make such deduction or withholding and shall timely pay
the full amount deducted or withheld to the relevant Governmental
Body in accordance with Applicable Law and, if such Tax is an
Indemnified Tax, then the sum payable by the applicable Loan Party
shall be increased as necessary so that after such deduction or
withholding has been made (including such deductions and
withholdings applicable to additional sums payable under this
Section) Agent or any Lender, as the case may be, receives an
amount equal to the sum it would have received had no such
deduction or withholding been made. Notwithstanding the submission
of documentation by any Lender under Section 3.10(g) hereof
claiming a reduced rate of or exemption from U.S. withholding Tax,
Agent shall be entitled to withhold United States federal income
Taxes at the full 30% withholding rate if in its reasonable
judgment it is required to do so under the due diligence
requirements imposed upon Agent under §1.1441-7(b) of the
United States Income Tax Regulations or other Applicable
Law.

 

(c) Payment of Other Taxes by the Loan
Parties. The Loan Parties shall timely pay to the relevant
Governmental Body in accordance with Applicable Law, or at the
option of Agent, promptly reimburse Agent for the payment of, any
Other Taxes.

 

(d) Indemnification by the Loan
Parties. Each Loan Party shall jointly and severally
indemnify Agent and each Lender, within ten (10) days after demand
therefor, for the full amount of any Indemnified Taxes (including
Indemnified Taxes imposed or asserted on or attributable to amounts
payable under this Section) paid or payable by Agent or any Lender
or required to be withheld or deducted from a payment to Agent or
such Lender, as the case may be, and any penalties, interest and
out-of-pocket expenses arising therefrom or with respect thereto,
whether or not such Indemnified Taxes were correctly or legally
imposed or asserted by the relevant Governmental Body. A
certificate as to the amount of such payment or liability delivered
to Borrowers by any Lender (with a copy to Agent), or by Agent on
its own behalf or on behalf of a Lender, shall be conclusive absent
manifest error.

 

(e) Indemnification by the
Lenders. Each Lender shall severally indemnify Agent, within
ten (10) days after demand therefor, for (i) any Indemnified Taxes
attributable to such Lender (but only to the extent that any Loan
Party has not already indemnified Agent for such Indemnified Taxes
and without limiting the obligation of the Loan Parties to do so),
and (ii) any Excluded Taxes attributable to such Lender, in each
case, that are payable or paid by Agent in connection with this
Agreement or any Other Document, and any reasonable expenses
arising therefrom or with respect thereto, whether or not such
Taxes were correctly or legally imposed or asserted by the relevant
Governmental Body. In addition, each Lender shall severally
indemnify Agent under §1.1461-1(e) of the United States Income
Tax Regulations against any claims and demands of any Lender for
the amount of any Tax it deducts and withholds in accordance with
regulations under §1441 of the Code. A certificate as to the
amount of such payment or liability delivered to any Lender by
Agent shall be conclusive absent manifest error. Each Lender hereby
authorizes Agent to set off and apply any and all amounts at any
time owing to such Lender hereunder or under any Other Document or
otherwise payable by Agent to such Lender from any other source
against any amount due to Agent under this subsection
(e).

 

(f) Evidence of Payments. As soon
as practicable after any payment of Taxes by any Loan Party to a
Governmental Body pursuant to this Section 3.10, such Loan Party
shall deliver to Agent the original or a certified copy of a
receipt issued by such Governmental Body evidencing such payment, a
copy of the return reporting such payment or other evidence of such
payment reasonably satisfactory to Agent.

 

 

 

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(g) Status of Lenders. (i) Any
Lender that is entitled to an exemption from or reduction of
withholding Tax with respect to payments hereunder or under any
Other Document shall deliver to Borrowing Agent and Agent, at the
time or times reasonably requested by Borrowers or Agent, such
properly completed and executed documentation required by
Applicable Law as will permit such payments to be made without
withholding or at a reduced rate of withholding. In addition, any
Lender, if reasonably requested by Borrowing Agent or Agent, shall
deliver such other documentation required by Applicable Law or
reasonably requested by Borrowing Agent or Agent as will enable
Borrowers or Agent to determine whether or not such Lender is
subject to backup withholding or information reporting
requirements. Notwithstanding anything to the contrary in the
preceding two sentences, the completion, execution and submission
of such documentation (other than such documentation set forth in
Sections 3.10(g)(ii)(A), (ii)(B) and (ii)(D) below) shall not be
required if in the applicable Lender’s reasonable judgment
such completion, execution or submission would subject such Lender
to any material unreimbursed cost or expense or would materially
prejudice the legal or commercial position of such
Lender.

 

(ii) Without limiting
the generality of the foregoing, in the event that any Borrower is
a U.S. Borrower,

 

(A) any Lender that is
a U.S. Person shall deliver to Borrowing Agent and Agent on or
prior to the date on which such Lender becomes a Lender under this
Agreement (and from time to time thereafter upon the reasonable
request of any Borrower or Agent), two (2) duly completed and
executed copies of IRS Form W-9 certifying that such Lender is
exempt from U.S. federal backup withholding Tax;

 

(B) any Foreign Lender
shall, to the extent it is legally entitled to do so, deliver to
Borrowing Agent and Agent (in such number of copies as shall be
requested by the recipient) on or prior to the date on which such
Foreign Lender becomes a Lender under this Agreement (and from time
to time thereafter upon the reasonable request of Borrowing Agent
or Agent), whichever of the following is applicable:

 

(1)           in
the case of a Foreign Lender claiming the benefits of an income tax
treaty to which the United States is a party (x) with respect to
payments of interest under this Agreement or any Other Document,
two (2) duly completed and executed copies of IRS Form W-8BEN or
W-8BEN-E (as applicable) establishing an exemption from, or
reduction of, U.S. federal withholding Tax pursuant to the
“interest” article of such tax treaty and (y) with
respect to any other applicable payments under this Agreement or
any Other Document, two (2) duly completed and executed copies of
IRS Form W-8BEN or W-8BEN-E (as applicable) establishing an
exemption from, or reduction of, U.S. federal withholding Tax
pursuant to the “business profits” or “other
income” article of such tax treaty;

 

(2)           two
(2) duly completed and executed copies of IRS Form
W-8ECI;

 

(3)           in
the case of a Foreign Lender claiming the benefits of the exemption
for portfolio interest under Section 881(c) of the Code, (x) two
(2) duly completed and executed copies of a certificate
substantially in the form of Exhibit 3.10-1 hereto to the effect
that such Foreign Lender is not a “bank” within the
meaning of Section 881(c)(3)(A) of the Code, a “10 percent
shareholder” of the Borrowers within the meaning of Section
881(c)(3)(B) of the Code, or a “controlled foreign
corporation” described in Section 881(c)(3)(C) of the Code (a
“U.S. Tax Compliance
Certificate”) and (y) two (2) duly completed and
executed copies of IRS Form W-8BEN; or

 

 

 

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(4)           to
the extent a Foreign Lender is not the beneficial owner, two (2)
duly completed and executed copies of IRS Form W-8IMY, accompanied
by two (2) duly completed and executed copies of IRS Form
W-8ECI, IRS Form W-8BEN or W-8BEN-E (as applicable), two (2) duly
completed and executed copies of a U.S. Tax Compliance Certificate
substantially in the form of Exhibit 3.10-2 or Exhibit 3.10-3
hereto, two (2) duly completed and executed copies of IRS Form W-9,
and/or other certification documents from each beneficial owner, as
applicable; provided that if the Foreign
Lender is a partnership and one or more direct or indirect partners
of such Foreign Lender are claiming the portfolio interest
exemption, such Foreign Lender may provide two (2) duly completed
and executed copies of a U.S. Tax Compliance Certificate
substantially in the form of Exhibit 3.10-4 hereto on behalf of
each such direct and indirect partner;

 

(C) any Foreign Lender
shall, to the extent it is legally entitled to do so, deliver to
the Borrowers and Agent (in such number of copies as shall be
requested by the recipient) on or prior to the date on which such
Foreign Lender becomes a Lender under this Agreement (and from time
to time thereafter upon the reasonable request of Borrowing Agent
or Agent), executed copies of any other form required by Applicable
Law as a basis for claiming exemption from or a reduction in U.S.
federal withholding Tax, duly completed, together with such
supplementary documentation as may be required by Applicable Law to
permit the Borrowers or Agent to determine the withholding or
deduction required to be made; and

 

(D) If a payment to a
Lender under this Agreement or any Other Document would be subject
to U.S. Federal withholding Taxes imposed by FATCA if such Lender
were to fail to comply with the applicable reporting requirements
of FATCA (including those contained in Section 1471(b) or 1472(b)
of the Code, as applicable), such Lender shall deliver to Borrowing
Agent and Agent at the time or times required by Applicable Law and
at such time or times reasonably requested by the Borrowers or
Agent such documentation required by Applicable Law (including as
required by Section 1471(b)(3)(C)(i) of the Code) and such
additional documentation reasonably requested by the Borrowers or
Agent as may be necessary for the Borrowers and Agent to comply
with their obligations under FATCA and to determine that such
Lender has complied with such Lender’s obligations under
FATCA or to determine the amount to deduct and withhold from such
payment. Solely for purposes of this clause (D),
“FATCA” shall include any amendments made to FATCA
after the date of this Agreement.

 

(ii) Each Lender agrees
that if any form or certification it previously delivered expires
or becomes obsolete or inaccurate in any respect, it shall update
such form or certification or promptly notify the Borrowers and
Agent in writing of its legal inability to do so.

 

(h) Treatment of Certain Refunds.
If any party determines, in its sole discretion exercised in good
faith, that it has received a refund of any Taxes as to which it
has been indemnified pursuant to this Section 3.10 (including by
the payment of additional amounts pursuant to this Section 3.10),
it shall pay to the indemnifying party an amount equal to such
refund (but only to the extent of indemnity payments made under
this Section with respect to the Taxes giving rise to such refund),
net of all out-of-pocket expenses (including Taxes) of such
indemnified party and without interest (other than any interest
paid by the relevant Governmental Body with respect to such
refund). Such indemnifying party, upon the request of such
indemnified party, shall repay to such indemnified party the amount
paid over pursuant to this subsection (h) (plus any penalties,
interest or other charges imposed by the relevant Governmental
Body) in the event that such indemnified party is required to repay
such refund to such Governmental Body. Notwithstanding anything to
the contrary in this subsection (h), in no event will the
indemnified party be required to pay any amount to an indemnifying
party pursuant to this subsection (h) the payment of which would
place the indemnified party in a less favorable net after-Tax
position than the indemnified party would have been in if the Tax
subject to indemnification and giving rise to such refund had not
been deducted, withheld or otherwise imposed and the
indemnification payments or additional amounts with respect to such
Tax had never been paid. This subsection shall not be construed to
require any indemnified party to make available its Tax returns (or
any other information relating to its Taxes that it deems
confidential) to the indemnifying party or any other
Person.

 

 

 

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(i) Survival. Each party’s
obligations under this Section 3.10 shall survive the resignation
or replacement of Agent or any assignment of rights by, or the
replacement of, a Lender, the termination of the Commitments and
the repayment, satisfaction or discharge of the
Obligations.

 

3.11. Replacement of
Lenders. If any Lender (an
“Affected Lender”) (a) makes demand upon Borrowers for
(or if Borrowers are otherwise required to pay) amounts pursuant to
Section 3.7, 3.9 or 3.10 hereof, (b) is unable to make or
maintain LIBOR Rate Loans as a result of a condition described in
Section 2.2(h) hereof, (c) is a Defaulting Lender, or (d) denies
any consent requested by Agent pursuant to Section 16.2(b) hereof,
Borrowers may, within ninety (90) days of receipt of such demand,
notice (or the occurrence of such other event causing Borrowers to
be required to pay such compensation or causing Section 2.2(h)
hereof to be applicable), or such Lender becoming a Defaulting
Lender or denial of a request by Agent pursuant to Section 16.2(b)
hereof, as the case may be, by notice in writing to Agent and such
Affected Lender (i) request the Affected Lender to cooperate with
Borrowers in obtaining a replacement Lender satisfactory to Agent
and Borrowers (the “Replacement Lender”); (ii) request
the non-Affected Lenders to acquire and assume all of the Affected
Lender’s Advances and its Revolving Commitment Percentage, as
provided herein, but none of such Lenders shall be under any
obligation to do so; or (iii) propose a Replacement Lender subject
to approval by Agent in its good faith business judgment. If any
satisfactory Replacement Lender shall be obtained, and/or if any
one or more of the non-Affected Lenders shall agree to acquire and
assume all of the Affected Lender’s Advances and its
Revolving Commitment Percentage, then such Affected Lender shall
assign, in accordance with Section 16.3 hereof, all of its Advances
and its Revolving Commitment Percentage, and other rights and
obligations under this Agreement and the Other Documents to such
Replacement Lender or non-Affected Lenders, as the case may be, in
exchange for payment of the principal amount so assigned and all
interest and fees accrued on the amount so assigned, plus all other Obligations then due and
payable to the Affected Lender.

 

3.12. Mitigation
Obligations. If any Lender
requests compensation under Section 3.7 hereof, or requires
the Borrower to pay any Indemnified Taxes or additional amounts to
any Lender or any Governmental Body for the account of any Lender
pursuant to Section 3.10 hereto, then such Lender shall (at
the request of Borrowing Agent) use reasonable efforts to designate
a different lending office for funding or booking its Revolving
Advances hereunder or to assign its rights and obligations
hereunder to another of its offices, branches or affiliates, if, in
the judgment of such Lender, such designation or assignment
(i) would eliminate or reduce amounts payable pursuant to
Section 3.7 or 3.10 hereof, as the case may be, in the future,
and (ii) would not subject such Lender to any unreimbursed
cost or expense and would not otherwise be disadvantageous to such
Lender. Loan Parties hereby agree to pay all reasonable costs and
expenses incurred by any Lender in connection with any such
designation or assignment.

 

IV. COLLATERAL: GENERAL
TERMS

 

4.1. Security Interest in the
Collateral. To secure the
prompt payment and performance to Agent, Issuer and each Lender
(and each other holder of any Obligations) of the Obligations, each
Loan Party hereby assigns, pledges and grants to Agent for its
benefit and for the ratable benefit of each Lender, Issuer and each
other Secured Party, a continuing security interest in and to and
Lien on all of its Collateral, whether now owned or existing or
hereafter created, acquired or arising and wherever located. Each
Loan Party shall provide Agent with written notice of all
commercial tort claims in an amount in excess of $500,000 promptly
upon the occurrence of any events giving rise to any such claims
(regardless of whether legal proceedings have yet been commenced),
such notice to contain a brief description of the claims, the
events out of which such claims arose and the parties against which
such claims may be asserted and, if applicable in any case where
legal proceedings regarding such claims have been commenced, the
case title together with the applicable court and docket number.
Upon delivery of each such notice, such Loan Party shall be deemed
to thereby grant to Agent a security interest and lien in and to
such commercial tort claims described therein and all proceeds
thereof. Each Loan Party shall provide Agent with written notice
promptly upon becoming the beneficiary under any letter of credit
or otherwise obtaining any right, title or interest in any letter
of credit rights (in each case in an amount in excess of $500,000),
and at Agent’s request shall take such actions as Agent may
reasonably request for the perfection of Agent’s security
interest therein.

 

 

 

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4.2. Perfection
of Security Interest. Each Loan Party
shall take all action that may be necessary, or that Agent may
reasonably request, so as at all times to maintain the validity,
perfection, enforceability and priority of Agent’s security
interest in and Lien on the Collateral or to enable Agent to
protect, exercise or enforce its rights hereunder and in the
Collateral, including, but not limited to, (a) immediately
discharging all Liens other than Permitted Encumbrances,
(b) obtaining Lien Waiver Agreements as provided in Section
7.19 hereof, (c) delivering to Agent, endorsed or accompanied by
such instruments of assignment as Agent may reasonably specify, and
stamping or marking, in such manner as Agent may reasonably
specify, any and all chattel paper, instruments, letters of credit
and advices thereof and documents evidencing or forming a part of
the Collateral, (d) using commercially reasonably efforts to
enter into warehousing, lockbox, customs and freight agreements and
other custodial arrangements satisfactory to Agent, and
(e) executing and delivering financing statements, control
agreements, instruments of pledge, mortgages, notices and
assignments, in each case in form and substance reasonably
satisfactory to Agent, relating to the creation, validity,
perfection, maintenance or continuation of Agent’s security
interest and Lien under the Uniform Commercial Code or other
Applicable Law. By its signature hereto, each Loan Party hereby
authorizes Agent to file against such Loan Party, one or more
financing, continuation or amendment statements pursuant to the
Uniform Commercial Code in form and substance satisfactory to Agent
(which statements may have a description of collateral which is
broader than that set forth herein, including without limitation a
description of Collateral as “all assets” and/or
“all personal property” of any Loan Party). All
charges, expenses and fees Agent may incur in doing any of the
foregoing, and any local taxes relating thereto, shall be charged
to Borrowers’ Account as a Revolving Advance of a Domestic
Rate Loan and added to the Obligations, or, at Agent’s
option, shall be paid by the Loan Parties to Agent for its benefit
and for the ratable benefit of Lenders.

 

4.3. Preservation of
Collateral. Following the
occurrence of an Event of Default, in addition to the rights and
remedies set forth in Section 11.1 hereof, Agent: (a) may at any
time take such steps as Agent deems necessary to protect
Agent’s interest in and to preserve the Collateral, including
the hiring of security guards or the placing of other security
protection measures as Agent may deem appropriate; (b) may employ
and maintain at any of any Loan Party’s premises a custodian
who shall have full authority to do all acts necessary to protect
Agent’s interests in the Collateral; (c) may lease warehouse
facilities to which Agent may move all or part of the Collateral;
(d) may use any Loan Party’s owned or leased lifts, hoists,
trucks and other facilities or Equipment for handling or removing
the Collateral; and (e) 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 Real Property owned
or leased by any Loan Party. Each Loan Party shall cooperate fully
with all of Agent’s efforts to preserve the Collateral and
will take such actions to preserve the Collateral as Agent may
direct. All of Agent’s expenses of preserving the Collateral,
including any expenses relating to the bonding of a custodian,
shall be charged to Borrowers’ Account as a Revolving Advance
maintained as a Domestic Rate Loan and added to the
Obligations.

 

4.4. Ownership and Location of
Collateral. With respect to
the Collateral, at the time the Collateral becomes subject to
Agent’s security interest: (i) each Loan Party shall be fully
authorized and able to sell, transfer, pledge and/or grant a first
priority Lien upon each and every item of its respective Collateral
to Agent; and, except for Permitted Encumbrances the Collateral
shall be free and clear of all Liens whatsoever; (ii) each document
and agreement executed by each Loan Party or delivered to Agent or
any Lender in connection with this Agreement shall be true and
correct in all respects; (iii) all signatures and endorsements of
each Loan Party that appear on such documents and agreements shall
be genuine and each Loan Party shall have full capacity to execute
same; and (iv) each Loan Party’s Equipment and Inventory
shall be located at the premises listed on the Disclosure Schedule
and the other locations permitted pursuant to Section 7.19
hereof.

 

 

 

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4.5. Defense
of Agent’s and Lenders’ Interests. Until (a) the
Payment in Full of all of the Obligations and (b) termination of
the Commitments and termination of this Agreement, Agent’s
interests in the Collateral shall continue in full force and
effect. During such period no Loan Party shall, without
Agent’s prior written consent, pledge, sell (except for sales
or other dispositions otherwise permitted in Section 7.1(b)
hereof), assign, transfer, create or suffer to exist a Lien upon or
encumber or allow or suffer to be encumbered in any way except for
Permitted Encumbrances, any part of the Collateral. Each Loan Party
shall use commercially reasonable efforts to defend Agent’s
interests in the Collateral against any and all Persons whatsoever.
At any time after the occurrence and during the continuation of an
Event of Default, Agent shall have the right to take possession of
the indicia of the Collateral and the Collateral in whatever
physical form contained, including: labels, stationery, documents,
instruments and advertising materials. If Agent exercises this
right to take possession of the Collateral, the Loan Parties shall,
upon demand, assemble it in the best manner possible and make it
available to Agent at a place reasonably convenient to Agent. In
addition, with respect to all Collateral, Agent and Lenders shall
be entitled to all of the rights and remedies set forth herein and
further provided by the Uniform Commercial Code or other Applicable
Law.

 

4.6. Inspection of
Premises. During business
hours, with reasonable prior notice and at reasonable intervals
unless an Event of Default has occurred and is continuing in which
case at all reasonable times, from time to time as often as Agent
shall elect in its Permitted Discretion, Agent shall have full
access to and the right to audit, check, inspect and make abstracts
and copies from each Loan Party’s books, records, audits,
correspondence and all other papers relating to the Collateral and
the operation of each Loan Party’s business. With reasonable
prior notice and at reasonable intervals unless an Event of Default
has occurred and is continuing in which case at all reasonable
times, Agent and its agents may enter upon any premises of any Loan
Party at any time during business hours, and from time to time as
often as Agent shall elect in its Permitted Discretion, for the
purpose of inspecting the Collateral and any and all records
pertaining thereto and the operation of such Loan Party’s
business. So long as no Event of Default has occurred and is
continuing, Agent may only conduct three (3) inspections in any
twelve-month period.

 

4.7. Reserved.

 

4.8. Receivables; Deposit Accounts and
Securities Accounts.

 

(a) Each of the
Receivables shall be a bona fide and valid account representing a
bona fide indebtedness incurred by the Customer therein named, for
a fixed sum as set forth in the invoice relating thereto (provided
immaterial or unintentional invoice errors shall not be deemed to
be a breach hereof) with respect to an absolute sale or lease and
delivery of goods upon stated terms of a Loan Party, or work, labor
or services theretofore rendered by a Loan Party as of the date
each Receivable is created. Same shall be due and owing in
accordance with the applicable Loan Party’s standard terms of
sale without dispute, setoff or counterclaim except as may be
stated on the accounts receivable schedules delivered by the Loan
Parties to Agent.

 

(b) Each Customer, to
each Loan Party’s knowledge, as of the date each Receivable
is created, is able to pay all Receivables on which the Customer is
obligated in full when due. With respect to such Customers of any
Loan Party who are not solvent, such Loan Party has set up on its
books and in its financial records bad debt reserves adequate to
cover such Receivables consistent with past practices.

 

(c) As of the Closing
Date, each Loan Party’s chief executive office is located as
set forth on the Disclosure Schedule. Until written notice is given
to Agent by Borrowing Agent of any other office at which any Loan
Party keeps its records pertaining to Receivables, all such records
shall be kept at such executive office.

 

 

 

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(d) The Loan Parties
shall instruct their Customers to deliver all remittances upon
Receivables (whether paid by check or by wire transfer of funds) to
such Blocked Accounts and/or Depository Accounts (and any
associated lockboxes) as Agent shall designate from time to time as
contemplated by Section 4.8(h) hereof or as otherwise agreed to
from time to time by Agent. Notwithstanding the foregoing, to the
extent any Loan Party directly receives any remittances upon
Receivables, such Loan Party shall, at such Loan Party’s sole
cost and expense, but on Agent’s behalf and for Agent’s
account, collect as Agent’s property and in trust for Agent
all amounts received on Receivables, and shall not commingle such
collections with any Loan Party’s funds or use the same
except to pay the Obligations, and shall as soon as possible and in
any event no later than one (1) Business Day after the receipt
thereof (i) in the case of remittances paid by check, deposit all
such remittances in their original form (after supplying any
necessary endorsements) and (ii) in the case of remittances paid by
wire transfer of funds, transfer all such remittances, in each
case, into such Blocked Accounts and/or Depository Accounts. Each
Loan Party shall deposit in the Blocked Account and/or Depository
Account or, upon request by Agent, deliver to Agent, in original
form and on the date of receipt thereof, all checks, drafts, notes,
money orders, acceptances, cash and other evidences of
Indebtedness.

 

(e) At any time when
an Event of Default has occurred and is continuing, Agent shall
have the right to send notice of the assignment of, and
Agent’s security interest in and Lien on, the Receivables to
any and all Customers or any third party holding or otherwise
concerned with any of the Collateral. Thereafter, Agent shall have
the sole right to collect the Receivables, take possession of the
Collateral, or both. Agent’s actual collection expenses,
including, but not limited to, stationery and postage, telephone,
facsimile, secretarial and clerical expenses and the salaries of
any collection personnel used for collection, may be charged to
Borrowers’ Account and added to the Obligations.

 

(f) Agent shall have
the right to receive, endorse, assign and/or deliver in the name of
Agent or any Loan Party any and all checks, drafts and other
instruments for the payment of money relating to the Receivables,
and each Loan Party hereby waives notice of presentment, protest
and non-payment of any instrument so endorsed. Each Loan Party
hereby constitutes Agent or Agent’s designee as such Loan
Party’s attorney with power (i) at any time: (A) to endorse
such Loan Party’s name upon any notes, acceptances, checks,
drafts, money orders or other evidences of payment or Collateral;
(B) to sign such Loan Party’s name on any invoice or bill of
lading relating to any of the Receivables, drafts against
Customers, assignments and verifications of Receivables; (C) to
send verifications of Receivables to any Customer, provided that
Agent shall work and cooperate with the Borrowers to conduct such
verifications in a manner designed to minimize interruption of the
Loan Parties’ business and keep confidential the transactions
contemplated hereby; (D) to sign such Loan Party’s name on
all agreements, documents or instruments deemed necessary or
appropriate by Agent to preserve, protect, or perfect Agent’s
interest in the Collateral and to file same; and (E) to receive,
open and dispose of all mail addressed to any Loan Party at any
post office box/lockbox maintained by Agent for the Loan Parties or
at any other business premises of Agent; and (ii) at any time
following the occurrence of an Event of Default: (A) to demand
payment of the Receivables; (B) to enforce payment of the
Receivables by legal proceedings or otherwise; (C) to exercise
all of such Loan Party’s rights and remedies with respect to
the collection of the Receivables and any other Collateral; (D) to
sue upon or otherwise collect, extend the time of payment of,
settle, adjust, compromise, extend or renew the Receivables; (E) to
settle, adjust or compromise any legal proceedings brought to
collect Receivables; (F) to prepare, file and sign such Loan
Party’s name on a proof of claim in bankruptcy or similar
document against any Customer; (G) to prepare, file and sign such
Loan Party’s name on any notice of Lien, assignment or
satisfaction of Lien or similar document in connection with the
Receivables; (H) to accept the return of goods represented by any
of the Receivables; (I) to change the address for delivery of mail
addressed to any Loan Party to such address as Agent may designate;
and (J) to do all other acts and things necessary to carry out this
Agreement. All acts of said attorney or designee are hereby
ratified and approved, and said attorney or designee shall not be
liable for any acts of omission or commission nor for any error of
judgment or mistake of fact or of law, unless done maliciously or
with gross (not mere) negligence (as determined by a court of
competent jurisdiction in a final and non-appealable judgment or
order); this power being coupled with an interest is irrevocable
while any of the Obligations remain unpaid.

 

 

 

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(g) Neither Agent nor
any Lender shall, under any circumstances or in any event
whatsoever, have any liability for any error or omission or delay
of any kind occurring in the settlement, collection or payment of
any of the Receivables or any instrument received in payment
thereof, or for any damage resulting therefrom.

 

(h) All proceeds of
Collateral shall be deposited by the Loan Parties into either (i) a
lockbox account, dominion account or such other “blocked
account” (each a “Blocked Account” and
collectively the “Blocked Accounts”) established at a
bank or banks as may be reasonably acceptable to Agent (each such
bank, a “Blocked Account Bank” and collectively,
“Blocked Account Banks”) pursuant to an arrangement
with such Blocked Account Bank as may be reasonably acceptable to
Agent or (ii) depository accounts (“Depository
Accounts”) established at Agent for the deposit of such
proceeds. Each applicable Loan Party, Agent and each Blocked
Account Bank shall enter into a deposit account control agreement
in form and substance reasonably satisfactory to Agent that is
sufficient to give Agent “control” (for purposes of
Articles 8 and 9 of the Uniform Commercial Code) over such Blocked
Accounts and which directs such Blocked Account Bank to transfer
such funds so deposited on a daily basis or at other times
acceptable to Agent to Agent, either to any account maintained by
Agent at said Blocked Account Bank or by wire transfer to an
appropriate account at Agent. All funds deposited in the Blocked
Accounts or Depository Accounts shall immediately become subject to
the security interest of Agent, for its own benefit and the ratable
benefit of the Secured Parties, and Borrowing Agent shall obtain
the agreement by each Blocked Account Bank to waive any offset
rights against the funds so deposited. Neither Agent nor any Lender
assumes any responsibility for such blocked account arrangement,
including any claim of accord and satisfaction or release with
respect to deposits accepted by any Blocked Account Bank
thereunder. Agent shall apply all funds received by it from the
Blocked Accounts and/or Depository Accounts to the satisfaction of
the Obligations (including the cash collateralization of all
Obligations relating to any outstanding Letters of Credit in
accordance with the provisions of Section 3.2(b) hereof) in such
order as Agent shall determine in its sole discretion, subject to
Borrowers’ ability to re-borrow Revolving Advances in
accordance with the terms hereof, provided that, in the absence of
any Event of Default, Agent shall apply all such funds representing
collection of Receivables first to the prepayment of the principal
amount of the Swing Loans, if any, and then to the Revolving
Advances.

 

(i) No Loan Party
will, without Agent’s consent, compromise or adjust any
material amount of the Receivables (or extend the time for payment
thereof) or accept any material returns of merchandise or grant any
additional discounts, allowances or credits thereon except for
those compromises, adjustments, returns, discounts, credits and
allowances as have been heretofore customary in the Ordinary Course
of Business of such Loan Party.

 

(j) All deposit
accounts (including all Blocked Accounts and Depository Accounts),
securities accounts and investment accounts of each Loan Party and
its Subsidiaries as of the Closing Date are set forth on the
Disclosure Schedule. No Loan Party shall open any new deposit
account, securities account or investment account (other than an
Excluded Account) with a bank, depository institution or securities
intermediary other than Agent unless, if required by Agent in its
sole discretion, such bank, depository institution or securities
intermediary, each applicable Loan Party and Agent shall first have
entered into an account control agreement in form and substance
reasonably satisfactory to Agent sufficient to give Agent
“control” (for purposes of Articles 8 and 9 of the
Uniform Commercial Code) over such account.

 

4.9. Reserved

 

4.10. Maintenance of
Equipment. The Loan
Parties’ Equipment shall be maintained in good operating
condition and repair (ordinary wear and tear excepted) and all
necessary replacements of and repairs thereto shall be
made.

 

 

 

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4.11. Exculpation
of Liability. Nothing set forth
herein shall be construed to constitute Agent or any Lender as any
Loan Party’s agent for any purpose whatsoever, nor shall
Agent or any Lender 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 Agent nor any Lender, whether by anything
herein or in any assignment or otherwise, assume any of any Loan
Party’s obligations under any contract or agreement assigned
to Agent or such Lender, and neither Agent nor any Lender shall be
responsible in any way for the performance by any Loan Party of any
of the terms and conditions thereof.

 

4.12. Financing
Statements. Except with
respect to the financing statements filed by Agent and any
financing statements filed in connection with Permitted
Encumbrances, no financing statement covering any of the Collateral
or any proceeds thereof is or will be on file in any public
office.

 

4.13. Investment Property
Collateral.

 

(a) Each Loan Party
has the right to transfer all Investment Property owned by such
Loan Party free of any Liens other than Permitted Encumbrances and
will use commercially reasonable efforts to defend its title to the
Investment Property against the claims of all Persons. Each
Subsidiary of AutoWeb shall (i) ensure that each operating
agreement, limited partnership agreement and any other similar
agreement permits Agent’s Lien on the Equity Interests of
wholly-owned Subsidiaries (other than Foreign Subsidiaries) arising
thereunder, foreclosure of Agent’s Lien and admission of any
transferee as a member, limited partner or other applicable equity
holder thereunder and (ii) use commercially reasonable efforts to
provide that each operating agreement, limited partnership
agreement and any other similar agreement with respect to any other
Person permits Agent’s Lien on the Investment Property of
such Loan Party arising thereunder, foreclosure of Agent’s
Lien and admission of any transferee as a member, limited partner
or other applicable equity holder thereunder.

 

(b) Each Loan Party
shall, if the Investment Property includes securities or any other
financial or other asset maintained in a securities account, cause
the custodian with respect thereto to execute and deliver a
notification and control agreement or other applicable agreement
satisfactory to Agent in order to perfect and protect Agent’s
Lien in such Investment Property.

 

(c) Except as set
forth in Article XI hereof, (i) the Loan Parties will have the
right to exercise all voting rights with respect to the Investment
Property and (ii) the Loan Parties will have the right to receive
all cash dividends and distributions, interest and premiums
declared and paid on the Investment Property to the extent
otherwise permitted under this Agreement. In the event any
additional Equity Interests are issued to any Loan Party as a stock
dividend or distribution or in lieu of interest on any of the
Investment Property, as a result of any split of any of the
Investment Property, by reclassification or otherwise, any
certificates evidencing any such additional shares will be
delivered to Agent within ten (10) Business Days and such shares
will be subject to this Agreement and a part of the Investment
Property to the same extent as the original Investment
Property.

 

 

 

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V. REPRESENTATIONS
AND WARRANTIES.

 

Each
Loan Party represents and warrants as follows, subject in each case
to such exceptions as are specifically contemplated by the
Disclosure Schedule:

 

5.1. Authority. Each Loan Party
has full power, authority and legal right to enter into this
Agreement and the Other Documents to which it is a party and to
perform all its respective Obligations hereunder and thereunder.
This Agreement and the Other Documents to which it is a party have
been duly executed and delivered by each Loan Party, and this
Agreement and the Other Documents to which it is a party constitute
the legal, valid and binding obligation of such Loan Party
enforceable in accordance with their terms, except as such
enforceability may be limited by any applicable bankruptcy,
insolvency, moratorium or similar laws affecting creditors’
rights generally. The execution, delivery and performance of this
Agreement and of the Other Documents to which it is a party (a) are
within such Loan Party’s corporate or company powers, as
applicable, have been duly authorized by all necessary corporate or
company action, as applicable, are not in contravention of law or
the terms of such Loan Party’s Organizational Documents or to
the conduct of such Loan Party’s business or of any Material
Contract or material undertaking to which such Loan Party is a
party or by which such Loan Party is bound, (b) will not conflict
with or violate any law or regulation, or any judgment, order or
decree of any Governmental Body, (c) will not require the
Consent of any Governmental Body, any party to a Material Contract
or any other Person, (d) will not conflict with, nor result in any
breach in, any of the provisions of or constitute a default under
the provisions of any agreement, instrument, or other document to
which such Loan Party is a party or by which it may be bound except
for any such conflict or breach that would not reasonably be
expected, either individually or in the aggregate, to result in a
Material Adverse Effect and (e) will not result in the creation of
any Lien except Permitted Encumbrances upon any asset of such Loan
Party pursuant to the provisions of any agreement, instrument, or
other document to which such Loan Party is a party or by which it
or its property is a party or by which it may be
bound.

 

5.2. Formation and
Qualification.

 

(a) Each Loan Party is
duly incorporated or formed, as applicable, and in good standing
under the laws of its jurisdiction of formation and is qualified to
do business and is in good standing in the states listed on the
Disclosure Schedule which constitute all states in which
qualification and good standing are necessary for such Loan Party
to conduct its business and own its property and where the failure
to so qualify could reasonably be expected to have a Material
Adverse Effect on such Loan Party. Each Loan Party has delivered to
Agent true and complete copies of its Organizational Documents and
will promptly notify Agent of any amendment or changes
thereto.

 

(b) The only
Subsidiaries of the Loan Parties are listed on the Disclosure
Schedule. The Disclosure Schedule sets forth a true, complete and
correct list of all Equity Interests held by AutoWeb and each other
Loan Party in each of its Subsidiaries and (ii) includes true,
correct and complete copies of all certificates evidencing all
Equity Interests held by AutoWeb and each other Loan Party in each
of its Subsidiaries.

 

5.3. Survival of Representations and
Warranties. All
representations and warranties of such Loan Party in this Agreement
and the Other Documents to which it is a party shall be true at the
time of such Loan Party’s execution of this Agreement and the
Other Documents to which it is a party, and shall survive the
execution, delivery and acceptance thereof by the parties thereto
and the closing of the transactions described therein or related
thereto.

 

 

 

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5.4. Tax
Returns. Each Loan
Party’s federal tax identification number is set forth on the
Disclosure Schedule. Each Loan Party has filed all federal, state
and local Tax returns and other reports each is required by law to
file and has paid all Taxes, assessments, fees and other
governmental charges that are due and payable except (a) Taxes that
are being Properly Contested or (b) to the extent that the failure
to do so could not reasonably be expected to have a Material
Adverse Effect. The provision for Taxes on the books of each Loan
Party is adequate for all years not closed by applicable statutes,
and for its current fiscal year, and no Loan Party has any
knowledge of any deficiency or additional assessment in connection
therewith not provided for on its books.

 

5.5. Financial
Statements.

 

(a) The pro forma
balance sheet of the Loan Parties on a Consolidated Basis (the
“Pro Forma Balance Sheet”) delivered to Agent prior to
the Closing Date reflects the consummation of the Transactions and
is accurate, complete and correct and fairly reflects the financial
condition of the Loan Parties on a Consolidated Basis as of the
Closing Date after giving effect to the Transactions, and presents
a good faith estimate of the pro forma consolidated financial
position. The Pro Forma Balance Sheet has been certified as
accurate, complete and correct in all material respects by the
President and Chief Financial Officer of Borrowing Agent. All
financial statements referred to in this Section 5.5(a), including
the related schedules and notes thereto, have been prepared in
accordance with GAAP, except as may be disclosed in such financial
statements.

 

(b) The twelve-month
cash flow, balance sheet and income statement projections of the
Loan Parties on a Consolidated Basis (the “Projections”
and together with the Pro Forma Balance Sheet, collectively, the
“Pro Forma Financial Statements”) delivered to Agent
prior to the Closing Date were prepared by the Chief Financial
Officer of AutoWeb, are based on underlying assumptions which
provide a reasonable basis for the projections therein, and reflect
the Loan Parties’ judgment based on present circumstances of
the most likely set of conditions and course of action for the
projected period.

 

(c) The audited
consolidated and consolidating balance sheets of the Loan Parties,
and such other Persons described therein, as of December 31, 2018,
and the related statements of income, changes in
stockholder’s equity, and changes in cash flow for the period
ended on such date, all accompanied by reports thereon containing
opinions without qualification by independent certified public
accountants, copies of which have been delivered to Agent, have
been prepared in accordance with GAAP, consistently applied (except
for changes in application to which such accountants concur) and
present fairly the financial position of the Loan Parties at such
date and the results of their operations for such period. The
unaudited consolidated and consolidating balance sheets of the Loan
Parties, and such other Persons described therein, as of February
28, 2019, and the related statements of income, changes in
stockholder’s equity, and changes in cash flow for the period
ended on such date, copies of which have been delivered to Agent,
present fairly the financial position of the Loan Parties at such
date and the results of their operations at such date.

 

(d) Since February 28,
2019, there has not been any event, occurrence or development that
has had a Material Adverse Effect.

 

5.6. Entity
Names.
No Loan Party has been known by any other company or corporate
name, as applicable, in the five (5) years prior to the Closing
Date and does not sell Inventory under any other name, nor has any
Loan Party been the surviving corporation or company, as
applicable, of a merger or consolidation or acquired all or
substantially all of the assets of any Person during the five (5)
years prior to the Closing Date.

 

 

 

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5.7. O.S.H.A.
Environmental Compliance; Flood Insurance. Except as could
not reasonably be expected to result in a Material Adverse
Effect:

 

(a) Each Loan Party is
in compliance with, and its facilities, business, assets, property,
leaseholds, Real Property and Equipment are in compliance with the
Federal Occupational Safety and Health Act, and Environmental Laws
and there are no outstanding citations, notices or orders of
non-compliance issued to any Loan Party or relating to its
business, assets, property, leaseholds or Equipment under any such
laws, rules or regulations.

 

(b) Each Loan Party
has been issued all required federal, state and local licenses,
certificates or permits (collectively, “Approvals”)
relating to all applicable Environmental Laws and all such
Approvals are current and in full force and effect.

 

(c) Each Loan Party is
in compliance with all applicable Environmental Laws.

 

(d) All Real Property
owned by the Loan Parties is insured pursuant to policies and other
bonds which are valid and in full force and effect and which
provide adequate coverage from reputable and financially sound
insurers in amounts sufficient to insure the assets and risks of
each such Loan Party in accordance with prudent business practice
in the industry of such Loan Party. Each Loan Party has taken all
actions required under the Flood Laws and/or requested by Agent to
assist in ensuring that each Lender is in compliance with the Flood
Laws applicable to the Collateral, including, but not limited to,
providing Agent with the address and/or GPS coordinates of each
structure located upon any Real Property that will be subject to a
mortgage or deed of trust in favor of Agent, and, to the extent
required, obtaining flood insurance for such property, structures
and contents prior to such property, structures and contents
becoming Collateral.

 

5.8. Solvency; No Litigation, Violation,
Indebtedness or Default; ERISA Compliance.

 

(a) (i) Each Loan
Party is, and after giving effect to the Transactions, each Loan
Party will be, solvent, able to pay its debts as they mature, (ii)
each Loan Party has, and after giving effect to the Transactions,
each Loan Party will have, capital sufficient to carry on its
business and all businesses in which it is about to engage, (iii)
as of the Closing Date, the fair present saleable value of the
assets of each Loan Party, calculated on a going concern basis, is
in excess of the amount of its liabilities, and (iv) subsequent to
the Closing Date, the fair saleable value of the assets of each
Loan Party (calculated on a going concern basis) will be in excess
of the amount of its liabilities.

 

(b) There are no
actions, suits, proceedings, claims, disputes or investigations
pending or, to the knowledge of Loan Parties, threatened, at law,
in equity, in arbitration or before any Governmental Authority, by
or against a Loan Party or any Subsidiary or against any of their
properties or revenues that (a) could reasonably be expected to be
adversely determined, and, if so determined, either individually or
in the aggregate could reasonably be expected to have a Material
Adverse Effect or (b) purport to affect or pertain to this
Agreement or the Other Documents or any of the transactions
contemplated hereby or could result in an Event of
Default.

 

(c) No Loan Party has
any outstanding Indebtedness other than the Obligations, except for
Permitted Indebtedness.

 

(d) No Loan Party is
in violation of any applicable statute, law, rule, regulation or
ordinance in any respect which could reasonably be expected to have
a Material Adverse Effect, nor is any Loan Party in violation of
any material order of any court, Governmental Body or arbitration
board or tribunal.

 

 

 

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(e) No Loan Party or
any member of the Controlled Group maintains or is required to
contribute to any Plan other than those listed on the Disclosure
Schedule. Each Plan is in compliance in all material respects with
the applicable provisions of ERISA, the Code and other Applicable
Laws. (i) Each Loan Party and each member of the Controlled Group
has met all applicable minimum funding requirements under Section
302 of ERISA and Section 412 of the Code in respect of each Plan,
and each Plan is in compliance with Sections 412, 430 and 436 of
the Code and Sections 206(g), 302 and 303 of ERISA, without regard
to waivers and variances; (ii) each Plan which is intended to be a
qualified plan under Section 401(a) of the Code as currently in
effect has been determined by the Internal Revenue Service to be
qualified under Section 401(a) of the Code and the trust related
thereto is exempt from federal income tax under Section 501(a) of
the Code or an application for such a determination is currently
being processed by the Internal Revenue Code; (iii) neither any
Loan Party nor any member of the Controlled Group has incurred any
liability to the PBGC other than for the payment of premiums, and
there are no premium payments which have become due which are
unpaid; (iv) no Plan has been terminated by the plan administrator
thereof nor by the PBGC, and there is no occurrence which would
cause the PBGC to institute proceedings under Title IV of ERISA to
terminate any Plan; (v) the current value of the assets of each
Plan exceeds the present value of the accrued benefits and other
liabilities of such Plan and neither any Loan Party nor any member
of the Controlled Group knows of any facts or circumstances which
would materially change the value of such assets and accrued
benefits and other liabilities; (vi) neither any Loan Party nor any
member of the Controlled Group has breached any of the
responsibilities, obligations or duties imposed on it by ERISA with
respect to any Plan; (vii) neither any Loan Party nor any member of
the Controlled Group has incurred any liability for any excise tax
arising under Section 4971, 4972 or 4980B of the Code, and no fact
exists which could give rise to any such liability; (viii) neither
any Loan Party nor any member of the Controlled Group nor any
fiduciary of, nor any trustee to, any Plan, has engaged in a
“prohibited transaction” described in Section 406 of
ERISA or Section 4975 of the Code nor taken any action which would
constitute or result in a Termination Event with respect to any
such Plan which is subject to ERISA; (ix) no Termination Event has
occurred or is reasonably expected to occur; (x) there exists no
Reportable ERISA Event; (xi) neither any Loan Party nor any member
of the Controlled Group has engaged in a transaction that could be
subject to Section 4069 or 4212(c) of ERISA; (xii) neither any Loan
Party nor any member of the Controlled Group maintains or is
required to contribute to any Plan which provides health, accident
or life insurance benefits to former employees, their spouses or
dependents, other than in accordance with Section 4980B of the
Code; (xiii) neither any Loan Party nor any member of the
Controlled Group has withdrawn, completely or partially, within the
meaning of Section 4203 or 4205 of ERISA, from any Multiemployer
Plan so as to incur liability under the Multiemployer Pension Plan
Amendments Act of 1980 and there exists no fact which would
reasonably be expected to result in any such liability; and (xiv)
no Plan fiduciary (as defined in Section 3(21) of ERISA) has any
liability for breach of fiduciary duty or for any failure in
connection with the administration or investment of the assets of a
Plan.

 

5.9. Intellectual
Property. All registered
Intellectual Property owned or utilized by any Loan Party: (a) is
set forth on the Disclosure Schedule and (b) to the extent material
to the Loan Parties business, is valid and has been duly registered
or filed with all appropriate Governmental Bodies. Loan Parties,
taken as a whole, have all of the intellectual property rights
which are necessary for the operation of its business. There is no
objection to, pending challenge to the validity of, or proceeding
by any Governmental Body to suspend, revoke, terminate or adversely
modify, any Intellectual Property that is material to the Loan
Parties business and no Loan Party is aware of any grounds for any
challenge or proceedings, except as set forth on the Disclosure
Schedule. All Intellectual Property owned or held by any Loan Party
consists of original material or property developed by such Loan
Party or was lawfully acquired by such Loan Party from the proper
and lawful owner thereof. Each of such items has been maintained so
as to preserve the value thereof from the date of creation or
acquisition thereof.

 

 

 

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5.10. Licenses
and Permits. Except as set
forth on the Disclosure Schedule, each Loan Party (a) is in
compliance with and (b) has procured and is now in possession of,
all material licenses or permits required by any applicable
federal, state, provincial or local law, rule or regulation for the
operation of its business in each jurisdiction wherein it is now
conducting or proposes to conduct business and where the failure to
procure such licenses or permits could reasonably be expected to
have a Material Adverse Effect.

 

5.11. Reserved.

 

5.12. No Default

 

. No
Default or Event of Default has occurred.

 

5.13. No Burdensome
Restrictions. No Loan Party is
party to any contract or agreement the performance of which could
reasonably be expected to have a Material Adverse Effect. Each Loan
Party has heretofore delivered to Agent true and complete copies of
all Material Contracts to which it is a party or to which it or any
of its properties is subject. No Loan Party has agreed or consented
to cause or permit in the future (upon the happening of a
contingency or otherwise) any of its property, whether now owned or
hereafter acquired, to be subject to a Lien which is not a
Permitted Encumbrance.

 

5.14. No Labor
Disputes. No Loan Party is
involved in any material labor dispute; there are no strikes or
walkouts or union organization of any Loan Party’s employees
threatened or in existence and no labor contract is scheduled to
expire during the Term.

 

5.15. Margin
Regulations. No Loan Party is
engaged, nor will it engage, principally or as one of its important
activities, in the business of extending credit for the purpose of
“purchasing” or “carrying” any
“margin stock” within the respective meanings of each
of the quoted terms under Regulation U of the Board of Governors of
the Federal Reserve System as now and from time to time hereafter
in effect. No part of the proceeds of any Advance will be used for
“purchasing” or “carrying” “margin
stock” as defined in Regulation U of such Board of
Governors.

 

5.16. Investment Company
Act. No Loan Party is
an “investment company” registered or required to be
registered under the Investment Company Act of 1940, as amended,
nor is it controlled by such a company.

 

5.17. Swaps. No Loan Party is
a party to, nor will it be a party to, any swap agreement whereby
such Loan Party has agreed or will agree to swap interest rates or
currencies unless same provides that damages upon termination
following an event of default thereunder are payable on an
unlimited “two-way basis” without regard to fault on
the part of either party.

 

5.18. Business and Property of the Loan
Parties. Upon and after
the Closing Date, the Loan Parties do not propose to engage in any
business other than digital marketing and activities necessary to
conduct the foregoing. On the Closing Date, each Loan Party will
own all the property and possess all of the rights and Consents
necessary for the conduct of the business of such Loan
Party.

 

5.19. Ineligible
Securities. The Loan Parties
do not intend to use and shall not use any portion of the proceeds
of the Advances, directly or indirectly, to purchase during the
underwriting period, or for 30 days thereafter, Ineligible
Securities being underwritten by a securities Affiliate of Agent or
any Lender.

 

5.20. Federal Securities
Laws. No Loan Party
other than AutoWeb, or any of their Subsidiaries (a) is
required to file periodic reports under the Exchange Act, (b) has
any securities registered under the Exchange Act or (c) has filed a
registration statement that has not yet become effective under the
Securities Act.

 

 

 

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5.21. Equity
Interests. The authorized
and outstanding Equity Interests of each Loan Party (other than
AutoWeb), and each legal and beneficial holder thereof as of the
Closing Date, are as set forth on the Disclosure Schedule. All of
such Equity Interests have been duly and validly authorized and
issued and are fully paid and non-assessable and have been sold and
delivered to the holders hereof in compliance with, or under valid
exemption from, all federal and state laws and the rules and
regulations of each Governmental Body governing the sale and
delivery of securities. There are no subscriptions, warrants,
options, calls, commitments, rights or agreement by which any Loan
Party or any of the shareholders of any Loan Party (in each case,
other than AutoWeb) is bound relating to the issuance, transfer,
voting or redemption of shares of its Equity Interests or any
pre-emptive rights held by any Person with respect to the Equity
Interests of the Loan Parties. The Loan Parties (other than
AutoWeb) have not issued any securities convertible into or
exchangeable for shares of its Equity Interests or any options,
warrants or other rights to acquire such shares or securities
convertible into or exchangeable for such shares.

 

5.22. Commercial Tort
Claims. As of the Closing
Date, no Loan Party has any commercial tort claims.

 

5.23. Letter of Credit
Rights. As of the Closing
Date, no Loan Party has any letter of credit rights.

 

5.24. Material
Contracts. The Disclosure
Schedule sets forth all Material Contracts of the Loan Parties. All
Material Contracts are in full force and effect and no material
defaults currently exist thereunder. No Loan Party has (i) received
any notice of termination or non-renewal of any Material Contract,
or (ii) exercised any option to terminate or not to renew any
Material Contract.

 

5.26            Disclosure. All factual
information taken as a whole (other than forward-looking
information and projections and information of a general economic
nature and general information about Loan Parties’ industry)
furnished by or on behalf of a Loan Party or its Subsidiaries in
writing to Agent or any Lender (including all information contained
in the Disclosure Schedule or in the Other Documents) for purposes
of or in connection with this Agreement or the Other Documents, and
all other such factual information taken as a whole (other than
forward-looking information and projections and information of a
general economic nature and general information about Loan
Parties’ industry) hereafter furnished by or on behalf of a
Loan Party or its Subsidiaries in writing to Agent or any Lender
will be, true and accurate, in all material respects, on the date
as of which such information is dated or certified and not
incomplete by omitting to state any fact necessary to make such
information (taken as a whole) not misleading in any material
respect at such time in light of the circumstances under which such
information was provided.

 

VI. AFFIRMATIVE
COVENANTS.

 

Each
Loan Party shall, until the Payment in Full of the Obligations, the
termination of the Commitments and the termination of this
Agreement:

 

6.1. Compliance with
Laws. Comply in all
material respects with all Applicable Laws with respect to the
Collateral or any part thereof or to the operation of such Loan
Party’s business the non-compliance with which could
reasonably be expected to have a Material Adverse Effect (except to
the extent any separate provision of this Agreement shall expressly
require compliance with any particular Applicable Laws pursuant to
another standard).

 

6.2. Conduct of Business and Maintenance
of Existence and Assets. (a) Conduct
continuously and operate actively its business according to good
business practices and maintain all of its properties useful or
necessary in its business in good working order and condition
(ordinary wear and tear excepted and except as may be disposed of
in accordance with the terms of this Agreement), including all
Intellectual Property and take all actions necessary to enforce and
protect the validity of any Intellectual Property right or other
right included in the Collateral that is material to the Loan
Parties’ business; (b) keep in full force and effect its
existence; and (c) make all such reports and pay all such franchise
and other taxes and license fees and do all such other acts and
things as may be lawfully required to maintain its rights,
licenses, leases, powers and franchises under the laws of the
United States or any political subdivision thereof, except to the
extent that failure to do so could not reasonably be expected to
have a Material Adverse Effect.

 

 

 

-65-

 

 

6.3. Books
and Records. Keep proper books
of record and account in which full, true and correct entries will
be made of all dealings or transactions of or in relation to its
business and affairs (including without limitation accruals for
taxes, assessments, Charges, levies and claims, allowances against
doubtful Receivables and accruals for depreciation, obsolescence or
amortization of assets), all in accordance with, or as required by,
GAAP consistently applied in the opinion of such independent public
accountant as shall then be regularly engaged by the Loan
Parties.

 

6.4. Payment of
Taxes. Pay, when due,
all Taxes, assessments and other Charges lawfully levied or
assessed upon such Loan Party or any of the Collateral, including
real and personal property taxes, assessments and charges and all
franchise, income, employment, social security benefits,
withholding and sales Taxes, except to the extent (a) being
Properly Contested or (b) that the failure to do so could not
reasonably be expected to have a Material Adverse Effect. If any
Taxes, assessments or other Charges remain unpaid after the date
fixed for their payment, or if any claim shall be made which, in
Agent’s opinion, may possibly create a valid Lien on the
Collateral, Agent may without notice to the Loan Parties pay the
Taxes, assessments or other Charges and each Loan Party hereby
indemnifies and holds Agent and each Lender harmless in respect
thereof. Agent will not pay any Taxes, assessments or Charges to
the extent that any applicable Loan Party has Properly Contested
those Taxes, assessments or Charges or if the failure to so pay
could not reasonably be expected to have a Material Adverse Effect.
The amount of any payment by Agent under this Section 6.4 shall be
charged to Borrowers’ Account as a Revolving Advance
maintained as a Domestic Rate Loan and added to the Obligations
and, until the Loan Parties shall provide Agent with an indemnity
therefor (or supply Agent with evidence satisfactory to Agent that
due provision for the payment thereof has been made), Agent may
hold without interest any balance standing to the Loan
Parties’ credit and Agent shall retain its security interest
in and Lien on any and all Collateral held by Agent.

 

6.5. Financial
Covenants. Cause to be
maintained as of the end of each fiscal quarter set forth below,
EBITDA for Borrowers and their Subsidiaries on a Consolidated Basis
of not less than the amount set forth below for such
period.

 

	

Period

	

Minimum
EBITDA

	

the
fiscal quarter ending June 30, 2019

	

(-$2,900,000)

	

the
fiscal quarter ending September 30, 2019

	

$2,100,000

	

the two
(2) fiscal quarters ending December 31, 2019

	

$5,000,000

	

the
three (3) fiscal quarters ending March 31, 2020

	

$7,500,000

	

the (4)
fiscal quarter period ending on the last day of each fiscal quarter
thereafter

	

$7,500,000

 

 

 

 

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6.6. Insurance.

 

(a) (i) Keep all its
insurable properties and properties in which such Loan Party has an
interest insured against the hazards of fire, flood, sprinkler
leakage, those hazards covered by extended coverage insurance and
such other hazards, and for such amounts, as is customary in the
case of companies engaged in businesses similar to such Loan
Party’s including business interruption insurance; (ii)
maintain a bond in such amounts as is customary in the case of
companies engaged in businesses similar to such Loan Party insuring
against larceny, embezzlement or other criminal misappropriation of
insured’s officers and employees who may either singly or
jointly with others at any time have access to the assets or funds
of such Loan Party either directly or through authority to draw
upon such funds or to direct generally the disposition of such
assets; (iii) maintain public and product liability insurance
against claims for personal injury, death or property damage
suffered by others; (iv) maintain all such worker’s
compensation or similar insurance as may be required under the laws
of any state or jurisdiction in which such Loan Party is engaged in
business; (v) deliver to Agent, at Agent’s request, (A)
copies of all policies and evidence of the maintenance of such
policies by the renewal thereof as soon as practicable before any
expiration date, and (B) appropriate loss payable endorsements in
form and substance satisfactory to Agent, naming Agent as an
additional insured and mortgagee and/or lender loss payee (as
applicable) as its interests may appear with respect to all
insurance coverage referred to in clauses (i), and (iii) above, and
providing (I) that all proceeds thereunder shall be payable to
Agent, (II) no such insurance shall be affected by any act or
neglect of the insured or owner of the property described in such
policy, and (III) that such policy and loss payable clauses may not
be cancelled, amended or terminated unless at least thirty (30)
days prior written notice is given to Agent (or in the case of
non-payment, at least ten (10) days prior written notice). In the
event of any loss thereunder, the carriers named therein hereby are
directed by Agent and the applicable Loan Party to make payment for
such loss to Agent and not to such Loan Party and Agent jointly. If
any insurance losses are paid by check, draft or other instrument
payable to any Loan Party and Agent jointly, Agent may endorse such
Loan Party’s name thereon and do such other things as Agent
may deem advisable to reduce the same to cash.

 

(b) Each Loan Party
shall take all actions required under the Flood Laws and/or
reasonably requested by Agent to assist in ensuring that each
Lender is in compliance with the Flood Laws applicable to the
Collateral, including, but not limited to, providing Agent with the
address and/or GPS coordinates of each structure on any Real
Property that will be subject to a mortgage or deed of trust in
favor of Agent, and, to the extent required, obtaining flood
insurance for such property, structures and contents prior to such
property, structures and contents becoming Collateral, and
thereafter maintaining such flood insurance in full force and
effect for so long as required by the Flood Laws.

 

(c) Agent is hereby
authorized to adjust and compromise claims under insurance coverage
referred to in Sections 6.6(a)(i), and (iii) and 6.6(b) above. All
loss recoveries received by Agent under any such insurance in
excess of $500,000 may be applied to the Obligations, in accordance
with this Agreement. Any surplus shall be paid by Agent to the Loan
Parties or applied as may be otherwise required by law. If any Loan
Party fails to obtain insurance as hereinabove provided, or to keep
the same in force, Agent, if Agent so elects, may obtain such
insurance and pay the premium therefor on behalf of such Loan
Party, which payments shall be charged to Borrowers’ Account
and constitute part of the Obligations.

 

6.7. Payment of Indebtedness and Leasehold
Obligations. Pay, discharge or
otherwise satisfy (i) at or before maturity (subject, where
applicable, to specified grace periods) all of its material
Indebtedness, except when the amount or validity thereof is
currently being Properly Contested and (ii) when due its material
rental obligations under all leases under which it is a tenant, and
shall otherwise comply, in all material respects, with all other
terms of such leases and keep them in full force and
effect.

 

 

 

-67-

 

 

6.8. Environmental
Matters. Ensure that all
of the Real Property owned or leased by any Loan Party and all
operations and businesses conducted thereon are in compliance and
remain in compliance with all Environmental Laws and it shall
manage any and all Hazardous Materials on any Real Property owned
or leased by any Loan Party in compliance with Environmental Laws
except where such non-compliance could not reasonably be expected
to have a Material Adverse Effect.

 

6.9. Standards of Financial
Statements. Cause all
financial statements referred to in Sections 9.7, 9.8, 9.9, 9.10,
9.11, 9.12 and 9.13 hereof as to which GAAP is applicable to be
complete and correct in all material respects (subject, in the case
of interim financial statements, to normal year-end audit
adjustments) and to be prepared in reasonable detail and in
accordance with GAAP applied consistently throughout the periods
reflected therein (except as disclosed therein).

 

6.10. Federal Securities
Laws. Promptly notify
Agent in writing if any Loan Party (other than AutoWeb) or any of
its Subsidiaries (a) is required to file periodic reports under the
Exchange Act, (b) registers any securities under the Exchange
Act or (c) files a registration statement under the Securities
Act.

 

6.11. Execution of Supplemental
Instruments. Execute and
deliver to Agent from time to time, upon demand, such supplemental
agreements, statements, assignments and transfers, or instructions
or documents relating to the Collateral, and such other instruments
as Agent may reasonably request, in order that the full intent of
this Agreement may be carried into effect.

 

6.12. Pledged
Cash.
Maintain, until the termination of the Pledged Cash Agreement, not
less than $5,000,000 at any time in an account controlled by Agent
and subject to the Pledged Cash Agreement. The Pledged Cash
Agreement shall terminate upon satisfaction of each of the
following conditions: (a) Agent shall have received the financial
statements and related documents required to be delivered by the
Loan Parties in accordance with Section 9.8 hereof for the fiscal
quarter ending June 30, 2020, (b) the Loan Parties shall be in
compliance with the financial covenant set forth in Section 6.5
hereof for the most recently ended fiscal quarter as evidenced by
the Compliance Certificate required to be delivered by the Loan
Parties in accordance with Section 9.8 hereof, (c) EBITDA for
Borrowers and their Subsidiaries on a Consolidated Basis shall be
greater than $10,000,000 and (d) no Default or Event of Default
shall have occurred and be continuing.

 

6.13. Guatemalan Subsidiary Cash
Restrictions. (a) In the event
the Guatemalan Subsidiary has cash proceeds in any of its deposit
or other accounts at any time in excess of $500,000 in the
aggregate, cause the Guatemalan Subsidiary to repatriate the amount
of such excess by sending it to AutoWeb and (b) cause the
Guatemalan Subsidiary to maintain any cash proceeds from any
transaction as a balance sheet asset to be used solely for the
purposes of funding costs, expenses and capital expenditures and
not investments.

 

6.14. Keepwell. If it is a
Qualified ECP Loan Party, then jointly and severally, together with
each other Qualified ECP Loan Party, hereby absolutely
unconditionally and irrevocably (a) guarantees the prompt
payment and performance of all Swap Obligations owing by each
Non-Qualifying Party (it being understood and agreed that this
guarantee is a guaranty of payment and not of collection), and (b)
undertakes to provide such funds or other support as may be needed
from time to time by any Non-Qualifying Party to honor all of such
Non-Qualifying Party’s obligations under this Agreement or
any Other Document in respect of Swap Obligations (provided,
however, that each Qualified ECP Loan Party shall only be liable
under this Section 6.14 for the maximum amount of such
liability that can be hereby incurred without rendering its
obligations under this Section 6.14, or otherwise under this
Agreement or any Other Document, voidable under Applicable Law,
including Applicable Law relating to fraudulent conveyance or
fraudulent transfer, and not for any greater amount). The
obligations of each Qualified ECP Loan Party under this Section
6.14 shall remain in full force and effect until the Payment in
Full of the Obligations, the termination of the Commitments and the
termination of this Agreement and the Other Documents. Each
Qualified ECP Loan Party intends that this Section 6.14
constitute, and this Section 6.14 shall be deemed to constitute, a
guarantee of the obligations of, and a “keepwell, support, or
other agreement” for the benefit of each other Loan Party for
all purposes of Section 1a(18(A)(v)(II) of the
CEA.

 

 

 

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6.15. Deposit Accounts. Maintain, as
of Friday of each week, an aggregate balance in all of the deposit
accounts maintained at Union Bank of less than $100,000. To the
extent the aggregate amounts in such accounts exceed the threshold
set forth in the preceding sentence as of such date of
determination, the Loan Parties shall cause such excess funds to be
deposited into deposit account number 8026430224 maintained at PNC
Bank, National Association on such date.

 

6.16. Post-Closing
Covenants.

 

(a) Within fifteen
(15) days after the Closing Date, the Loan Parties shall have
delivered to Agent the final loss payable endorsement issued by
Loan Parties’ insurer naming Agent as lenders loss
payee.

 

(b) Within 60 (sixty)
days after the Closing Date (unless such time period is extended by
Agent pursuant to its written consent), Loan Parties shall have
provided to Agent deposit account control agreements, in form and
substance satisfactory to Agent, with respect to all deposit
accounts, other than Excluded Accounts, of the Loan Parties
maintained by Union Bank.

 

(c) Within one hundred
eighty (180) days of the Closing Date (unless such time period is
extended by Agent pursuant to its written consent), the Loan
Parties shall have closed all of the deposit accounts maintained at
Union Bank and JP Morgan.

 

VII. NEGATIVE
COVENANTS.

 

No Loan
Party shall, until the Payment in Full of the Obligations, the
termination of the Commitments and the termination of this
Agreement:

 

7.1. Merger, Consolidation, Acquisition
and Sale of Assets.

 

(a) Enter into any
merger, consolidation or other reorganization with or into any
other Person or acquire all or a substantial portion of the assets
or Equity Interests of any Person or permit any other Person to
consolidate with or merge with it, except that (i) the Loan Parties
may undertake Permitted Acquisitions, (ii)the Loan Parties may make
Permitted Investments and (iii) any Loan Party may merge,
consolidate or reorganize with another Loan Party or acquire the
assets or Equity Interest of another Loan Party so long as (A) such
Loan Party shall provide Agent with ten (10) days prior written
notice of such merger, consolidation or reorganization, (B) in
connection with any merger, consolidation or reorganization to
which a Borrower is a party, such Borrower must be the surviving
entity of merger, consolidation or reorganization, (C) in
connection with any merger, consolidation or reorganization between
a Loan Party and any of its Affiliates or Subsidiaries which is not
a Loan Party, such Loan Party must be the surviving entity of
merger, consolidation or reorganization, and (D) such Loan Party
shall deliver to Agent all of the relevant agreements, documents
and instruments evidencing such merger, consolidation or
reorganization.

 

(b) Sell, lease,
transfer or otherwise dispose of any of its properties or assets,
except (i) in the Ordinary Course of Business, (ii) the disposition
or transfer of surplus, obsolete or worn-out Equipment, (iii) the
disposition of Intellectual Property (including domain names) to
the extent not material to the business of the Loan Parties, (iv)
the licensing of Intellectual Property rights on
a non-exclusive basis in the Ordinary Course of Business,
(v) the sale or discount, in each case without recourse, of
Receivables arising in the Ordinary Course of Business, but only in
connection with the compromise or collection thereof, (vi) any
loss, damage or destruction of property or condemnation, seizure or
taking, by exercise of the power of eminent domain or otherwise, or
confiscation or requisition of use of property, (vii) the leasing
or subleasing of assets of any Loan Party or its Subsidiaries in
the Ordinary Course of Business, (viii) transfers of assets (A) to
a Loan Party and (B) to any Subsidiary of any Loan Party that is
not a Loan Party in an amount not to exceed, when taken together
with Permitted Investments under clause (a)(v)(B) of the definition
thereof and Permitted Loans under clause (d)(ii) of the definition
thereof, $300,000 in the aggregate during the Term, (ix) Permitted
Encumbrances, Permitted Investments and dividends or distributions
permitted by Section 7.7 hereof, (x) the Loan Parties may make the
Permitted Minority Investment Dispositions and (xi) other
dispositions of assets in an amount not to exceed $500,000 during
the Term.

 

 

 

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7.2. Creation
of Liens. Create or suffer
to exist any Lien upon or against any of its property or assets now
owned or hereafter created or acquired, except Permitted
Encumbrances.

 

7.3. Guarantees. Become liable
upon the obligations or liabilities of any Person by assumption,
endorsement or guaranty thereof or otherwise (other than to
Lenders) except (a) guarantees by one or more Loan Parties of the
Indebtedness or obligations of any other Loan Party to the extent
such Indebtedness or obligations are permitted to be incurred
and/or outstanding pursuant to the provisions of this Agreement and
(b) the endorsement of checks in the Ordinary Course of
Business.

 

7.4. Investments. Purchase or
acquire obligations or Equity Interests of, or any other interest
in, any Person, other than Permitted Investments.

 

7.5. Loans. Make advances,
loans or extensions of credit to any Person, including any Parent,
Subsidiary or Affiliate other than Permitted Loans.

 

7.6. Capital
Expenditures. Contract for,
purchase or make any expenditure or commitments for Capital
Expenditures in an aggregate amount for all Loan Parties in excess
of (a) $300,000 for the fiscal quarter ending June 30, 2019, (b)
$2,500,000 for the fiscal year ending December 31, 2019 and (c)
$5,000,000 for the fiscal year ending December 31, 2020 and for
each fiscal year ending thereafter.

 

7.7. Dividends and
Distributions. Declare, pay or
make any dividend or distribution on any Equity Interests of any
Loan Party or apply any of its funds, property or assets to the
purchase, redemption or other retirement of any of its Equity
Interests, or of any options to purchase or acquire any Equity
Interests of any Loan Party except that (a) a Loan Party may pay or
make dividends or distributions payable in its Equity Interests
(other than Disqualified Equity Interests) or undertake split-ups
or reclassifications of its Equity Interests (other than
Disqualified Equity Interests), (b) a Loan Party may pay or make
dividends or distributions to another Loan Party and (c) AutoWeb
may redeem the preferred stock or preferred stock rights issued
pursuant to its Tax Benefit Preservation Plan dated as of May 26,
2010, as such plan may be amended, supplemented, extended or
replaced, in accordance with such plan.

 

7.8. Indebtedness.
Create, incur, assume or suffer to exist any Indebtedness other
than Permitted Indebtedness.

 

7.9. Nature of
Business. Substantially
change the nature of the business in which it is presently engaged
or any business reasonably related or incidental thereto or
representing a reasonable expansion thereof.

 

7.10. Transactions with
Affiliates. Directly or
indirectly, purchase, acquire or lease any property from, or sell,
transfer or lease any property to, or otherwise enter into any
transaction or deal with, any Affiliate, except for (a)
transactions among the Loan Parties and their respective
Subsidiaries which are not expressly prohibited by the terms of
this Agreement, (b) payment by the Loan Parties of dividends
and distributions permitted under Section 7.7 hereof, (c) Permitted
Affiliate Transactions and (d) transactions in the Ordinary Course
of Business, on an arm’s-length basis on terms and conditions
no less favorable than terms and conditions which would have been
obtainable from a Person other than an Affiliate.

 

7.11. Leases. Enter as lessee
into any lease arrangement for real or personal property (unless
capitalized and permitted under Section 7.6 hereof) if after giving
effect thereto, aggregate annual rental payments for all leased
property would exceed $2,000,000 in any one fiscal year in the
aggregate for all Loan Parties.

 

 

 

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7.12. Subsidiaries.

 

(a) Form any
Subsidiary unless such Subsidiary (i) is not a Foreign Subsidiary,
(ii) at Agent’s discretion, expressly joins in this Agreement
as a Loan Party and becomes jointly and severally liable for the
Obligations, and (iii) Agent shall have received all documents,
including without limitation, legal opinions and appraisals it may
reasonably require to establish compliance with each of the
foregoing conditions in connection therewith.

 

(b) Enter into any
partnership, joint venture or similar arrangement other than
Permitted Investments unless the entering into of such Permitted
Investments would cause the Loan Parties or any of them to be
directly or indirectly liable for the obligations of any
partnership, joint venture or similar arrangement constituting such
Permitted Investments.

 

7.13. Fiscal Year and Accounting
Changes. Change its fiscal
year from December 31 or make any significant change (a) in
accounting treatment and reporting practices except as required by
GAAP or (b) in tax reporting treatment except as required by
law.

 

7.14. Pledge of
Credit. Now or hereafter
pledge Agent’s or any Lender’s credit on any purchases,
commitments or contracts or for any purpose
whatsoever.

 

7.15. Amendment of Organizational
Documents. (a) Change its
legal name, (b) change its form of legal entity (e.g., converting
from a corporation to a limited liability company or vice versa),
(c) change its jurisdiction of organization or become (or attempt
or purport to become) organized in more than one jurisdiction, or
(d) otherwise amend, modify or waive any term or material provision
of its Organizational Documents or its Tax Benefit Preservation
Plan dated as of May 26, 2010, as such plan may be amended,
supplemented, extended or replaced, in accordance with such plan,
in each case, in a manner that is materially adverse to the Agent
or Required Lenders unless required by law, in any such case
without (i) giving at least thirty (30) days prior written notice
of such intended change to Agent, (ii) having received from Agent
confirmation that Agent has taken all steps necessary for Agent to
continue the perfection of and protect the enforceability and
priority of its Liens in the Collateral belonging to such Loan
Party and in the Equity Interests of such Loan Party and (iii) in
any case under clause (d), having received the prior written
consent of Agent and Required Lenders to such amendment,
modification or waiver.

 

7.16. Compliance with
ERISA. (a) (x) Maintain,
or permit any member of the Controlled Group to maintain, or (y)
become obligated to contribute, or permit any member of the
Controlled Group to become obligated to contribute, to any Plan,
other than those Plans disclosed on the Disclosure Schedule, (b)
engage, or permit any member of the Controlled Group to engage, in
any non-exempt “prohibited transaction”, as that term
is defined in Section 406 of ERISA or Section 4975 of the Code, (c)
terminate, or permit any member of the Controlled Group to
terminate, any Plan where such event could result in any liability
of any Loan Party or any member of the Controlled Group or the
imposition of a lien on the property of any Loan Party or any
member of the Controlled Group pursuant to Section 4068 of ERISA,
(d) incur, or permit any member of the Controlled Group to incur,
any withdrawal liability to any Multiemployer Plan; (e) fail
promptly to notify Agent of the occurrence of any Termination
Event, (f) fail to comply, or permit any member of the Controlled
Group to fail to comply, with the requirements of ERISA or the Code
or other Applicable Laws in respect of any Plan, (g) fail to meet,
permit any member of the Controlled Group to fail to meet, or
permit any Plan to fail to meet all minimum funding requirements
under ERISA and the Code, without regard to any waivers or
variances, or postpone or delay or allow any member of the
Controlled Group to postpone or delay any funding requirement with
respect to any Plan, or (h) cause, or permit any member of the
Controlled Group to cause, a representation or warranty in Section
5.8(e) hereof to cease to be true and correct.

 

 

 

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7.17. Prepayment
of Indebtedness. At any time,
directly or indirectly, prepay any Indebtedness (other than to
Lenders) in excess of $1,000,000, or repurchase, redeem, retire or
otherwise acquire any Indebtedness of any Loan Party.

 

7.18. Division. Notwithstanding
anything to the contrary contained herein, (a) divide or enter into
any plan of division pursuant to section 18-217 of the Delaware
Limited Liability Company Act or any similar stature or provision
under any Applicable Law or otherwise, (b) dispose of any
property through a plan of division under the Delaware Limited
Liability Company Act or any comparable transaction under any
similar law or (c) make any payment or distribution pursuant to a
plan of division under the Delaware Limited Liability Company Act
or any comparable transaction under any similar law.

 

7.19. Locations. No Loan Party shall
move its chief executive office from the location set forth on the
Disclosure Schedule (as updated from time to time), permit its
material books and records or servers which contain information or
data not available at its chief executive office to be located at
any location not set forth on the Disclosure Schedule, or maintain
any place of business other than those set forth on the Disclosure
Schedule, in each case, without (a) providing Agent with prior
written notice thereof, which notice shall be deemed to update the
Disclosure Schedule with respect thereto, and (b) if requested by
Agent with respect to locations of material books, records and
servers, using commercially reasonable efforts to provide to Agent
a Lien Waiver Agreement duly executed by the owner or lessor of
such location.

 

VIII. CONDITIONS
PRECEDENT.

 

8.1. Conditions to Initial
Advances. The agreement of
Lenders to make the initial Advances requested to be made on the
Closing Date is subject to the satisfaction, or waiver by Agent,
immediately prior to or concurrently with the making of such
Advances, of the following conditions precedent:

 

(a) Other Documents. Agent shall
have received, in form and substance satisfactory to Agent, each of
the Other Documents, in each case duly authorized, executed and
delivered by the Loan Parties and any other Person party
thereto;

 

(b) Financial Condition
Certificate. Agent shall have received an executed Financial
Condition Certificate in the form of Exhibit 8.1(b) attached
hereto;

 

(c) Reserved.

 

(d) Borrowing Base. Agent shall
have received a Borrowing Base Certificate providing evidence that
the aggregate amount of Eligible Receivables and Eligible Unbilled
Receivables is sufficient in value and amount to support Revolving
Advances in the amount requested by the Borrowers on the Closing
Date;

 

(e) Undrawn Availability. After
giving effect to the initial Advances, the Borrowers shall have
Undrawn Availability of at least $7,500,000;

 

(f) Blocked Accounts. The Loan
Parties shall have opened the Depository Accounts with Agent and/or
Agent shall have received duly executed agreements establishing the
Blocked Accounts with one or more Blocked Account Banks for the
collection or servicing of the Receivables and proceeds of the
Collateral and Agent shall have received, in form and substance
satisfactory to Agent, deposit account control agreements among
Agent, each applicable Loan Party and each applicable Blocked
Account Bank with respect to such Blocked Accounts;

 

 

 

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(g) Filings, Registrations and
Recordings. Each document (including any Uniform Commercial
Code financing statements and Uniform Commercial Code termination
statements) required by this Agreement, any of the Other Documents
or under Applicable Law or reasonably requested by Agent to be
filed, registered or recorded in order to create, in favor of
Agent, a perfected security interest in or lien upon the Collateral
and in order to terminate the perfected security interest in or
lien upon the Collateral of any existing lender shall have been
properly filed, registered or recorded in each jurisdiction in
which the filing, registration or recordation thereof is so
required or requested, and Agent shall have received an
acknowledgment copy, or other evidence satisfactory to it, of each
such filing, registration or recordation and satisfactory evidence
of the payment of any necessary fee, tax or expense relating
thereto;

 

(h) Pledged Cash. Borrower shall
have deposited not less than $5,000,000 into a deposit account
maintained by Agent and subject to the Pledged Cash
Agreement;

 

(i) Lien Waiver Agreements. Agent
shall have received Lien Waiver Agreements with respect to the Loan
Parties chief executive offices;

 

(j) Secretary’s Certificates,
Authorizing Resolutions and Good Standing Certificates.
Agent shall have received, in form and substance satisfactory to
Agent, a certificate of the Secretary or Assistant Secretary (or
other equivalent officer or manager) of each Loan Party dated as of
the Closing Date which shall certify (i) copies of resolutions, in
form and substance reasonably satisfactory to Agent, of the board
of directors (or other equivalent governing body or member) of such
Loan Party authorizing (x) the execution, delivery and performance
of this Agreement and the Other Documents to which such Loan Party
is a party (including authorization of the incurrence of
Indebtedness, borrowing of Advances and requesting of Letters of
Credit on a joint and several basis with all Loan Parties as
provided for herein), and (y) the granting by such Loan Party of
the Liens upon the Collateral to secure all of the joint and
several Obligations of the Loan Parties (and such certificate shall
state that such resolutions have not been amended, modified,
revoked or rescinded as of the date of such certificate), (ii) the
incumbency and signature of the officers of such Loan Party
authorized to execute this Agreement and the Other Documents, (iii)
copies of the Organizational Documents of such Loan Party as in
effect on such date, complete with all amendments thereto, and (iv)
copies of a good standing certificate (or the equivalent thereof)
issued by the Secretary of State or other appropriate official of
its jurisdiction of organization and dated not more than 30 days
prior to the Closing Date. Agent shall have also received the good
standing (or equivalent status) of each Loan Party in each
jurisdiction where such Loan Party is qualified to do business and
the conduct of the Loan Parties’ business activities in such
jurisdiction accounts for five percent (5%) or more of the Loan
Parties’ revenue, as evidenced by good standing certificates
(or the equivalent thereof issued by any applicable jurisdiction)
dated not more than thirty (30) days prior to the Closing Date,
issued by the Secretary of State or other appropriate official of
each such jurisdiction;

 

(k) Legal Opinion. Agent shall
have received, in form and substance satisfactory to Agent, the
executed legal opinion of counsel to the Loan Parties which shall
cover such matters incident to the Transactions as Agent may
reasonably require and each Loan Party hereby authorizes and
directs such counsel to deliver such opinion to Agent and
Lenders;

 

(l) No Litigation. No litigation,
investigation or proceeding before or by any arbitrator or
Governmental Body shall be continuing or threatened against any
Loan Party or against the officers or directors of any Loan Party
(A) in connection with this Agreement, the Other Documents or any
of the transactions contemplated hereby or thereby and which, in
the reasonable opinion of Agent, is deemed material or (B) which
could, in the reasonable opinion of Agent, have a Material Adverse
Effect; and (ii) no injunction, writ, restraining order or other
order of any nature materially adverse to any Loan Party or the
conduct of its business or inconsistent with the due consummation
of the Transactions shall have been issued by any Governmental
Body;

 

 

 

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(m) Collateral Examination. Agent
shall have completed Collateral examinations, the results of which
shall be satisfactory in form and substance to Agent, of the
Receivables, and all books and records in connection
therewith;

 

(n) Fees. Agent shall have
received all fees payable to Agent and Lenders on or prior to the
Closing Date hereunder, including pursuant to Article III hereof
and the Fee Letter;

 

(o) Pro Forma Financial
Statements. Agent shall have received a copy of the Pro
Forma Financial Statements which shall be satisfactory in all
respects to Agent;

 

(p) Insurance. Agent shall have
received, in form and substance satisfactory to Agent, (i) evidence
that adequate insurance, including without limitation, casualty and
liability insurance, required to be maintained under this Agreement
is in full force and effect, (ii) insurance certificates issued by
the Loan Parties’ insurance broker containing such
information regarding the Loan Parties’ casualty and
liability insurance policies as Agent shall request and naming
Agent as an additional insured, lenders loss payee and/or
mortgagee, as applicable, and (iii) loss payable endorsements
issued by the Loan Parties’ insurer naming Agent as lenders
loss payee and mortgagee, as applicable;

 

(q) Payment Instructions. Agent
shall have received (i) (A) the Pledged Cash and (B) and all other
amounts necessary to satisfy the closing costs and fees due and
payable on the Closing Date and (ii) written instructions from
Borrowing Agent directing the application of the amounts specified
in clause (i)(B) to the payment of such closing costs and
fees;

 

(r) Consents. Agent shall have
received any and all Consents necessary to permit the effectuation
of the Transactions and Agent shall have received such Consents and
waivers of such third parties as might assert claims with respect
to the Collateral, as Agent shall deem necessary;

 

(s) No Material Adverse Change.
(i) Since February 28, 2019, there shall not have occurred any
event, condition or state of facts which could reasonably be
expected to have a Material Adverse Effect and (ii) no
representations made or information supplied to Agent or Lenders
shall have been proven to be inaccurate or misleading in any
material respect;

 

(t) Contract Review. Agent shall
have received and reviewed all Material Contracts of the Loan
Parties including all material leases, union contracts, labor
contracts, vendor supply contracts, license agreements and
distributorship agreements and such contracts and agreements shall
be satisfactory in all respects to Agent;

 

(u) Compliance with Laws. Agent
shall be reasonably satisfied that each Loan Party is in compliance
with all pertinent federal, state, local or territorial
regulations, including those with respect to the Federal
Occupational Safety and Health Act, the Environmental Protection
Act, ERISA and the Anti-Terrorism Laws; and

 

(v) Other. All corporate and other
proceedings, and all documents, instruments and other legal matters
in connection with the Transactions shall be satisfactory in form
and substance to Agent.

 

8.2. Conditions to Each
Advance. The agreement of
Lenders to make any Advance requested to be made on any date
(including the initial Advance), is subject to the satisfaction of
the following conditions precedent as of the date such Advance is
made:

 

 

 

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(a) Representations and
Warranties. Each of the representations and warranties made
by any Loan Party in or pursuant to this Agreement and the Other
Documents, and each of the representations and warranties in any
agreement, document, instrument, certificate or financial or other
statement provided at any time under or in connection with this
Agreement and the Other Documents shall be true and correct in all
respects on and as of such date as if made on and as of such date
(except to the extent any such representation or warranty expressly
relates only to any earlier and/or specified date);

 

(b) No Default. No Event of
Default or Default shall have occurred and be continuing on such
date, or would exist after giving effect to the Advances requested
to be made, on such date; provided, however that Agent, in its sole
discretion, may continue to make Advances notwithstanding the
existence of an Event of Default or Default and that any Advances
so made shall not be deemed a waiver of any such Event of Default
or Default; and

 

(c) Maximum Advances. In the case
of any type of Advance requested to be made, after giving effect
thereto, the aggregate amount of such type of Advance shall not
exceed the maximum amount of such type of Advance permitted under
this Agreement.

 

Each
request for an Advance by any Borrower hereunder shall constitute a
representation and warranty by each Loan Party as of the date of
such Advance that the conditions of this subsection shall have been
satisfied.

 

IX. INFORMATION AS TO
THE LOAN PARTIES.

 

Each
Loan Party shall, or (except with respect to Section 9.11 hereof)
shall cause Borrowing Agent on its behalf to, until the Payment in
Full of the Obligations, the termination of the Commitments and the
termination of this Agreement:

 

9.1. Disclosure of Material
Matters. Immediately upon
learning thereof, report to Agent (a) all matters materially
affecting the value, enforceability or collectability of any
portion of the Collateral, including any Loan Party’s
reclamation or repossession of, or the return to any Loan Party of,
a material amount of goods or claims or disputes asserted by any
Customer or other obligor, and (b) any investigation, hearing,
proceeding or other inquest by any Governmental Body into any Loan
Party or any Affiliate of any Loan Party with respect to
Anti-Terrorism Laws.

 

9.2. Schedules. Deliver to Agent,
in form and substance satisfactory to Agent: (a) on or before the
fifteenth (15th) day of each month as and for the prior month (i)
accounts receivable (including billed and unbilled) agings
inclusive of reconciliations to the general ledger, (ii) accounts
payable schedules inclusive of reconciliations to the general
ledger and (iii) a Borrowing Base Certificate (which shall be
calculated as of the last day of the prior month and which shall
not be binding upon Agent or restrictive of Agent’s rights
under this Agreement) and (b) at such reasonable intervals as Agent
may require: (i) confirmatory assignment schedules; (ii)
copies of Customer’s invoices; (iii) evidence of
shipment or delivery; and (iv) such further schedules, documents
and/or information regarding the Collateral as Agent may require
including trial balances and test verifications. The items to be
provided under this Section are to be in form reasonably
satisfactory to Agent and executed by each Loan Party and delivered
to Agent from time to time solely for Agent’s convenience in
maintaining records of the Collateral, and any Loan Party’s
failure to deliver any of such items to Agent shall not affect,
terminate, modify or otherwise limit Agent’s Lien with
respect to the Collateral. Unless otherwise agreed to by Agent, the
items to be provided under this Section 9.2 shall be delivered to
Agent by the specific method of Approved Electronic Communication
designated by Agent.

 

9.3. [Reserved].

 

 

 

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9.4. Litigation.
Promptly notify Agent in writing of any claim, litigation, suit or
administrative proceeding affecting any Loan Party, whether or not
the claim is covered by insurance, and of any litigation, suit or
administrative proceeding, which in any such case could reasonably
be expected to have a Material Adverse Effect.

 

9.5. Material
Occurrences. Immediately
notify Agent in writing upon the occurrence of: (a) any Event of
Default or Default; (b) any event, development or circumstance
whereby any financial statements or other reports provided to Agent
fail in any material respect to present fairly, in accordance with
GAAP consistently applied, the financial condition or operating
results of any Loan Party as of the date of such statements; (c)
any funding deficiency which, if not corrected as provided in
Section 4971 of the Code, could subject any Loan Party or any
member of the Controlled Group to a tax imposed by Section 4971 of
the Code; (d) each and every default by any Loan Party which
might result in the acceleration of the maturity of any
Indebtedness which could result in an Event of Default, including
the names and addresses of the holders of such Indebtedness with
respect to which there is a default existing or with respect to
which the maturity has been or could be accelerated, and the amount
of such Indebtedness; and (e) any other development in the business
or affairs of any Loan Party, which could reasonably be expected to
have a Material Adverse Effect; in each case as to clauses (a)
through (e) of this Section 9.5, describing the nature thereof and
the action the Loan Parties propose to take with respect
thereto.

 

9.6. Government
Receivables. Notify Agent
immediately if any of its Receivables arise out of contracts
between any Loan Party and the United States, any state, or any
department, agency or instrumentality of any of them.

 

9.7. Annual Financial
Statements. Deliver to Agent
within ninety (90) days after the end of each fiscal year of the
Loan Parties, audited financial statements of the Loan Parties on a
consolidating and consolidated basis including, but not limited to,
a balance sheet, statements of income, stockholders’ equity
and cash flow from the beginning of the current fiscal year to the
end of such fiscal year and the balance sheet as at the end of such
fiscal year, all prepared in accordance with GAAP applied on a
basis consistent with prior practices, and in reasonable detail and
reported upon without qualification by an independent certified
public accounting firm selected by the Loan Parties and
satisfactory to Agent. The reports described in this Section shall
be accompanied by a Compliance Certificate.

 

9.8. Quarterly Financial
Statements. Deliver to Agent
within forty-five (45) days after the end of each fiscal quarter,
an unaudited balance sheet of the Loan Parties on a consolidated
and consolidating basis and unaudited statements of income,
stockholders’ equity and cash flow of the Loan Parties on a
consolidated and consolidating basis reflecting results of
operations from the beginning of the fiscal year to the end of such
fiscal quarter and for such fiscal quarter, prepared on a basis
consistent with prior practices and complete and correct in all
material respects, subject to normal and recurring year-end
adjustments that individually and in the aggregate are not material
to the Loan Parties’ business operations and setting forth in
comparative form the respective financial statements for the
corresponding date and period in the previous fiscal year. The
reports described in this Section shall be accompanied by a
Compliance Certificate.

 

9.9. Monthly Financial
Statements. Deliver to Agent
within thirty (30) days after the end of each month, an unaudited
balance sheet of the Loan Parties on a consolidated and
consolidating basis and unaudited statements of income,
stockholders’ equity and cash flow of the Loan Parties on a
consolidated and consolidating basis reflecting results of
operations from the beginning of the fiscal year to the end of such
month and for such month, prepared on a basis consistent with prior
practices and complete and correct in all material respects,
subject to normal and recurring year-end adjustments that
individually and in the aggregate are not material to the Loan
Parties’ business operations and setting forth in comparative
form the respective financial statements for the corresponding date
and period in the previous fiscal year. The reports described in
this Section shall be accompanied by a Compliance
Certificate.

 

 

 

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9.10. Other
Reports. Provide Agent as
soon as available, but in any event within ten (10) days after the
issuance thereof, with notices of any material public filings not
made in the Ordinary Course of Business.

 

9.11. Additional
Information. Provide Agent
with such additional information as Agent shall reasonably request
in order to enable Agent to determine whether the terms, covenants,
provisions and conditions of this Agreement and the Other Documents
have been complied with by the Loan Parties including, without the
necessity of any request by Agent, (a) copies of all environmental
audits and reviews, (b) at least thirty (30) days prior thereto,
notice of any Loan Party’s opening of any new office or place
of business or any Loan Party’s closing of any existing
office or place of business, and (c) promptly upon any Loan
Party’s learning thereof, notice of any labor dispute to
which any Loan Party may become a party, any strikes or walkouts
relating to any of its plants or other facilities, and the
expiration of any labor contract to which any Loan Party is a party
or by which any Loan Party is bound.

 

9.12. Projected Operating
Budget. Provide Agent, no
later than thirty (30) days prior to the beginning of each Loan
Party’s fiscal years commencing with fiscal year 2020, a
month by month projected operating budget and cash flow, income
statement and balance sheet of the Loan Parties, in each case, on a
monthly basis and on a consolidated and consolidating basis for
such fiscal year, such projections to be accompanied by a
certificate signed by the President or Chief Financial Officer of
each Loan Party to the effect that such projections have been
prepared on the basis of sound financial planning practice
consistent with past budgets and financial statements and that such
officer has no reason to question the reasonableness of any
material assumptions on which such projections were
prepared.

 

9.13. Variances From Operating
Budget. Deliver to Agent,
concurrently with the delivery of the financial statements referred
to in Sections 9.7, 9.8 and 9.9 hereof, a written report
summarizing all material variances from budgets submitted by the
Loan Parties pursuant to Section 9.12 hereof and a discussion
and analysis by management with respect to such
variances.

 

9.14. Notice of Suits, Adverse
Events. Provide Agent
with prompt written notice of (a) any lapse or other
termination of any Consent issued to any Loan Party by any
Governmental Body or any other Person that is material to the
operation of any Loan Party’s business, (b) any refusal by
any Governmental Body or any other Person to renew or extend any
such Consent, (c) copies of any periodic or special reports
filed by any Loan Party with any Governmental Body or Person, if
such reports indicate any material change in the business,
operations, affairs or condition of any Loan Party, or if copies
thereof are requested by Agent, and (d) copies of any material
notices and other communications from any Governmental Body or
Person which specifically relate to any Loan Party.

 

 

 

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9.15. ERISA
Notices and Requests. Provide Agent
with immediate written notice in the event that (a) any Loan Party
or any member of the Controlled Group knows or has reason to know
that a Termination Event has occurred, together with a written
statement describing such Termination Event and the action, if any,
which such Loan Party or any member of the Controlled Group has
taken, is taking, or proposes to take with respect thereto and,
when known, any action taken or threatened by the Internal Revenue
Service, Department of Labor or PBGC with respect thereto, (b) any
Loan Party or any member of the Controlled Group knows or has
reason to know that a prohibited transaction (as defined in Section
406 of ERISA or 4975 of the Code) has occurred together with a
written statement describing such transaction and the action which
such Loan Party or any member of the Controlled Group has taken, is
taking or proposes to take with respect thereto, (c) a funding
waiver request has been filed with respect to any Plan together
with all communications received by any Loan Party or any member of
the Controlled Group with respect to such request, (d) any increase
in the benefits of any existing Plan or the establishment of any
new Plan or the commencement of contributions to any Plan to which
any Loan Party or any member of the Controlled Group was not
previously contributing shall occur, (e) any Loan Party or any
member of the Controlled Group shall receive from the PBGC a notice
of intention to terminate a Plan or to have a trustee appointed to
administer a Plan, together with copies of each such notice, (f)
any Loan Party or any member of the Controlled Group shall receive
any favorable or unfavorable determination letter from the Internal
Revenue Service regarding the qualification of a Plan under Section
401(a) of the Code, together with copies of each such letter; (g)
any Loan Party or any member of the Controlled Group shall receive
a notice regarding the imposition of withdrawal liability, together
with copies of each such notice; (h) any Loan Party or any member
of the Controlled Group shall fail to make a required installment
or any other required payment under the Code or ERISA on or before
the due date for such installment or payment; or (i) any Loan Party
or any member of the Controlled Group knows that (1) a
Multiemployer Plan has been terminated, (2) the administrator or
plan sponsor of a Multiemployer Plan intends to terminate a
Multiemployer Plan, (3) the PBGC has instituted or will institute
proceedings under Section 4042 of ERISA to terminate a
Multiemployer Plan or (4) a Multiemployer Plan is subject to
Section 432 of the Code or Section 305 of ERISA.

 

9.16. Additional
Documents. Execute and
deliver to Agent, upon request, such documents and agreements as
Agent may, from time to time, reasonably request to carry out the
purposes, terms or conditions of this Agreement.

 

9.17. Updates to Disclosure
Schedule. Together with
each Compliance Certificate delivered under Section 9.8 hereof,
deliver to Agent any information required to maintain the
representations and warranties set forth in Sections 4.4, 4.8(j),
5.2(b), 5.4, 5.6, 5.7, 5.8(e), 5.9, 5.14, 5.21 or 5.24 as true and
correct in all material respects as of the date of such Compliance
Certificate, and if the Loan Parties comply with this Section 9.17,
such representations and warranties will be deemed true and correct
in all material respects at all times prior to the delivery of such
Compliance Certificate. The information provided with the
Compliance Certificates in accordance with this Section 9.17
shall automatically and immediately be deemed to update the
Disclosure Schedule.

 

X. EVENTS OF
DEFAULT.

 

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

 

10.1. Nonpayment. Failure by any
Loan Party to pay when due (a) any principal or interest on the
Obligations (including without limitation pursuant to
Section 2.9 hereof), or (b) any other fee, charge, amount or
liability provided for herein or in any Other Document, in each
case whether at maturity, by reason of acceleration pursuant to the
terms of this Agreement, by notice of intention to prepay or by
required prepayment;

 

 

 

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10.2. Breach
of Representation. Except as
provided in Section 10.18 hereof, any representation or warranty
made or deemed made by any Loan Party in this Agreement, any Other
Document or in any agreement, documents, certificate or financial
or other statement provided at any time in connection herewith or
therewith shall prove to have been incorrect or misleading in any
material respect on the date when made or deemed to have been
made;

 

10.3. Financial
Information. Failure by any
Loan Party to (a) deliver financial information when due under
Sections 9.7, 9.8, 9.9, 9.12, 9.13 or any other Section of this
Agreement or, if no due date is specified herein, within three (3)
Business Days following a request therefor, or (b) permit the
inspection of its books or records or access to its premises for
audits and appraisals in accordance with the terms
hereof;

 

10.4. Judicial
Actions. Issuance of a
notice of Lien, levy, assessment, injunction or attachment (a)
against any Loan Party’s Receivables or (b) against a
material portion of any Loan Party’s other property which, in
the case of either (a) or (b), is not stayed or lifted within
thirty (30) days;

 

10.5. Noncompliance.
Except as otherwise provided for in Sections 10.1, 10.3, 10.5(b),
and 10.18 hereof, (a) failure or neglect of any Loan Party to
perform, keep or observe any term, provision, condition, covenant
herein, or in any Other Document, or (b) failure or neglect of any
Loan Party to perform, keep or observe any term, provision,
condition or covenant in Sections 4.5, 6.1, 6.3, 6.4, 6.6, 6.7,
6.11, 9.4 or 9.6 hereof which is not cured within thirty (30) days
from the earlier of (x) the date on which written notice thereof is
delivered to any Loan Party by Agent and (y) the date the Loan
Parties learn of such failure or neglect;

 

10.6. Judgments. Any (a) judgment,
writ, order or decree for the payment of money are rendered against
any Loan Party for an aggregate amount in excess of $500,000 or
against all Loan Parties for an aggregate amount in excess of
$500,000 and (b) (i) action shall be legally taken by any judgment
creditor to levy upon assets or properties of any Loan Party to
enforce any such judgment, (ii) such judgment shall remain
undischarged for a period of thirty (30) consecutive days during
which a stay of enforcement of such judgment, by reason of a
pending appeal or otherwise, shall not be in effect, or (iii) any
Liens arising by virtue of the rendition, entry or issuance of such
judgment upon assets or properties of any Loan Party shall be
senior to any Liens in favor of Agent on such assets or
properties;

 

10.7. Bankruptcy. Any Loan Party or
any Subsidiary of any Loan Party shall (a) apply for, consent to or
suffer the appointment of, or the taking of possession by, a
receiver, custodian, trustee, liquidator or similar fiduciary of
itself or of all or a substantial part of its property,
(b) admit in writing its inability, or be generally unable, to
pay its debts as they become due or cease operations of its present
business, (c) make a general assignment for the benefit of
creditors, (d) commence a voluntary case under any state or
federal bankruptcy or receivership laws (as now or hereafter in
effect), (e) be adjudicated a bankrupt or insolvent (including by
entry of any order for relief in any involuntary bankruptcy or
insolvency proceeding commenced against it), (f) file a petition
seeking to take advantage of any other law providing for the relief
of debtors, (g) acquiesce to, or fail to have dismissed,
within sixty (60) days, any petition filed against it in any
involuntary case under such bankruptcy laws, or (h) take any action
for the purpose of effecting any of the foregoing;

 

10.8. Reserved.

 

10.9. Lien
Priority. Any Lien created
hereunder or provided for hereby or under any of the Other
Documents for any reason ceases to be or is not a valid and
perfected Lien having a first priority Lien (subject only to
Permitted Encumbrances);

 

10.10. Reserved.

 

 

 

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10.11. Cross
Default. Either (a) any
specified “event of default” under any Indebtedness
(other than the Obligations) of any Loan Party with a
then-outstanding principal balance (or, in the case of any
Indebtedness not so denominated, with a then-outstanding total
obligation amount) of $500,000 or more, or any other event or
circumstance which would permit the holder of any such Indebtedness
of any Loan Party to accelerate such Indebtedness (and/or the
obligations of such Loan Party thereunder) prior to the scheduled
maturity or termination thereof, shall occur (regardless of whether
the holder of such Indebtedness shall actually accelerate,
terminate or otherwise exercise any rights or remedies with respect
to such Indebtedness) or (b) a default of the obligations of any
Loan Party under any other agreement to which it is a party shall
occur which has or is reasonably likely to have a Material Adverse
Effect;

 

10.12. Breach of Guaranty, Guarantor
Security Agreement or Pledge Agreement. Termination or
breach of any Guaranty, Guarantor Security Agreement, Pledge
Agreement or similar agreement executed and delivered to Agent in
connection with the Obligations of any Loan Party, or if any Loan
Party or pledgor attempts to terminate or challenges the validity
of, its liability under, any such Guaranty, Guarantor Security
Agreement, Pledge Agreement or similar agreement;

 

10.13. Change of
Control. Any Change of
Control shall occur;

 

10.14. Invalidity. Any material
provision of this Agreement or any Other Document shall, for any
reason, cease to be valid and binding on any Loan Party, or any
Loan Party shall so claim in writing to Agent or any Lender or any
Loan Party challenges the validity of its liability under this
Agreement or any Other Document;

 

10.15. Seizures. Any (a) material
portion of the Collateral shall be seized, subject to garnishment
or taken by a Governmental Body, or any Loan Party, or (b) the
title and rights of any Loan Party to any material portion of the
Collateral shall have become the subject matter of claim,
litigation, suit, garnishment or other proceeding which might, in
the opinion of Agent, upon final determination, result in
impairment or loss of the security provided by this Agreement or
the Other Documents;

 

10.16. Reserved.

 

10.17. Pension
Plans. An event or
condition specified in Section 7.16 or 9.15 hereof shall occur or
exist with respect to any Plan and, as a result of such event or
condition, together with all other such events or conditions, any
Loan Party or any member of the Controlled Group shall incur, or in
the opinion of Agent be reasonably likely to incur, a liability to
a Plan or the PBGC (or both) which, in the reasonable judgment of
Agent, would have a Material Adverse Effect; or the occurrence of
any Termination Event, or any Loan Party’s failure to
immediately report a Termination Event in accordance with Section
9.15 hereof; or

 

10.18. Anti-Terrorism Laws. If (a)
any representation or warranty contained in
(i) Section 16.18 hereof or (ii) any corresponding
section of any Guaranty is or becomes false or misleading at any
time, (b) any Borrower shall fail to comply with its obligations
under Section 16.18 hereof, or (c) any Guarantor shall fail to
comply with its obligations under any section of any Guaranty
containing provisions comparable to those set forth in Section
16.18 hereof.

 

 

 

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XI. LENDERS’
RIGHTS AND REMEDIES AFTER DEFAULT.

 

11.1. Rights and
Remedies.

 

(a) Upon the
occurrence of: (i) an Event of Default pursuant to Section 10.7
hereof (other than Sections 10.7(b), (g) or (h) hereof), all
Obligations shall be immediately due and payable and this Agreement
and the obligation of Lenders to make Advances shall be deemed
terminated, (ii) any of the other Events of Default and at any
time thereafter while such Event of Default is continuing, at the
option of Agent or at the direction of Required Lenders all
Obligations shall be immediately due and payable and Agent or
Required Lenders shall have the right to terminate this Agreement
and to terminate the obligation of Lenders to make Advances; and
(iii) without limiting Section 8.2 hereof, any Default under
Section 10.7(g) hereof, the obligation of Lenders to make
Advances hereunder shall be suspended until such time as such
involuntary petition shall be dismissed. Upon the occurrence and
during the continuation of any Event of Default, Agent shall have
the right to exercise any and all rights and remedies provided for
herein, under the Other Documents, under the Uniform Commercial
Code and at law or equity generally, including the right to
foreclose the security interests granted herein and to realize upon
any Collateral by any available judicial procedure and/or to take
possession of and sell any or all of the Collateral with or without
judicial process. Agent may enter any of any Loan Party’s
premises or other premises without legal process and without
incurring liability to any Loan Party therefor, and Agent may
thereupon, or at any time thereafter, in its discretion without
notice or demand, take the Collateral and remove the same to such
place as Agent may deem advisable and Agent may require the Loan
Parties to make the Collateral available to Agent at a convenient
place. With or without having the Collateral at the time or place
of sale, Agent may sell the Collateral, or any part thereof, at
public or private sale, at any time or place, in one or more sales,
at such price or prices, and upon such terms, either for cash,
credit or future delivery, as Agent may elect. Except as to that
part of the Collateral which is perishable or threatens to decline
speedily in value or is of a type customarily sold on a recognized
market, Agent shall give the Loan Parties reasonable notification
of such sale or sales, it being agreed that in all events written
notice mailed to Borrowing Agent at least ten (10) days prior to
such sale or sales is reasonable notification. At any public sale
Agent or any Lender may bid (including credit bid) for and become
the purchaser, and Agent, any Lender or any other purchaser at any
such sale thereafter shall hold the Collateral sold absolutely free
from any claim or right of whatsoever kind, including any equity of
redemption and all such claims, rights and equities are hereby
expressly waived and released by each Loan Party. In connection
with the exercise of the foregoing remedies, including the sale of
Inventory, Agent is granted a perpetual nonrevocable, royalty free,
nonexclusive license and Agent is granted permission to use all of
each Loan Party’s (a) Intellectual Property which is used or
useful in connection with Inventory for the purpose of marketing,
advertising for sale and selling or otherwise disposing of such
Inventory and (b) Equipment for the purpose of completing the
manufacture of unfinished goods. The Net Cash Proceeds realized
from the sale of any Collateral shall be applied to the Obligations
in the order set forth in Section 11.5 hereof. Noncash proceeds
will only be applied to the Obligations as they are converted into
cash. If any deficiency shall arise, the Loan Parties shall remain
liable to Agent and Lenders therefor.

 

 

 

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(b) To the extent that
Applicable Law imposes duties on Agent to exercise remedies in a
commercially reasonable manner, each Loan Party acknowledges and
agrees that it is not commercially unreasonable for Agent: (i) to
fail to incur expenses reasonably deemed significant by Agent to
prepare Collateral for disposition or otherwise to complete raw
material or work in process into finished goods or other finished
products for disposition; (ii) to fail to obtain third party
consents for access to Collateral to be disposed of, or to obtain
or, if not required by other law, to fail to obtain governmental or
third party consents for the collection or disposition of
Collateral to be collected or disposed of; (iii) to fail to
exercise collection remedies against Customers or other Persons
obligated on Collateral or to remove Liens on or any adverse claims
against Collateral; (iv) to exercise collection remedies against
Customers and other Persons obligated on Collateral directly or
through the use of collection agencies and other collection
specialists; (v) to advertise dispositions of Collateral through
publications or media of general circulation, whether or not the
Collateral is of a specialized nature; (vi) to contact other
Persons, whether or not in the same business as any Loan Party, for
expressions of interest in acquiring all or any portion of such
Collateral; (vii) to hire one or more professional auctioneers to
assist in the disposition of Collateral, whether or not the
Collateral is of a specialized nature; (viii) to dispose of
Collateral by utilizing internet sites that provide for the auction
of assets of the types included in the Collateral or that have the
reasonable capacity of doing so, or that match buyers and sellers
of assets; (ix) to dispose of assets in wholesale rather than
retail markets; (x) to disclaim disposition warranties, such as
title, possession or quiet enjoyment, (xi) to purchase insurance or
credit enhancements to insure Agent against risks of loss,
collection or disposition of Collateral or to provide to Agent a
guaranteed return from the collection or disposition of Collateral;
or (xii) to the extent deemed appropriate by Agent, to obtain the
services of other brokers, investment bankers, consultants and
other professionals to assist Agent in the collection or
disposition of any of the Collateral. Each Loan Party acknowledges
that the purpose of this Section 11.1(b) is to provide
non-exhaustive indications of what actions or omissions by Agent
would not be commercially unreasonable in Agent’s exercise of
remedies against the Collateral and that other actions or omissions
by Agent shall not be deemed commercially unreasonable solely on
account of not being indicated in this Section 11.1(b). Without
limitation upon the foregoing, nothing in this Section 11.1(b)
shall be construed to grant any rights to any Loan Party or to
impose any duties on Agent that would not have been granted or
imposed by this Agreement or by Applicable Law in the absence of
this Section 11.1(b).

 

(c) Without limiting
any other provision hereof:

 

(i) At any bona fide
public sale, and to the extent permitted by Applicable Law, at any
private sale, Agent shall be free to purchase all or any part of
the Investment Property. Agent shall be authorized at any such sale
(if it deems it advisable to do so) to restrict the prospective
bidders or purchasers to persons who will represent and agree that
they are purchasing the Investment Property for their own account
in compliance with Regulation D of the Securities Act or any other
applicable exemption available under the Securities Act. Agent will
not be obligated to make any sale if it determines not to do so,
regardless of the fact that notice of the sale may have been given.
Agent may adjourn any sale and sell at the time and place to which
the sale is adjourned. If the Investment Property is customarily
sold on a recognized market or threatens to decline speedily in
value, Agent may sell such Investment Property at any time without
giving prior notice to any Loan Party or other Person.

 

(ii) Each Loan Party
recognizes that Agent may be unable to effect or cause to be
effected a public sale of the Investment Property by reason of
certain prohibitions of the Securities Act, so that Agent may be
compelled to resort to one or more private sales to a restricted
group of purchasers who will be obligated to agree, among other
things, to acquire the Investment Property for their own account,
for investment and without a view to the distribution or resale
thereof. Each Loan Party understands that private sales so made may
be at prices and on other terms less favorable to the seller than
if the Investment Property were sold at public sales, and agrees
that Agent has no obligation to delay or agree to delay the sale of
any of the Investment Property for the period of time necessary to
permit the issuer of the securities which are part of the
Investment Property (even if the issuer would agree), to register
such securities for sale under the Securities Act. Each Loan Party
agrees that private sales made under the foregoing circumstances
shall be deemed to have been made in a commercially reasonable
manner.

 

 

 

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(iii) The Net Cash
Proceeds arising from the disposition of the Investment Property
after deducting expenses incurred by Agent will be applied to the
Obligations pursuant to Section 11.5 hereof. If any excess remains
after the discharge of all of the Obligations, the same will be
paid to the applicable Loan Party or to any other Person that may
be legally entitled thereto.

 

At any
time after the occurrence and during the continuance of an Event of
Default (A) Agent may transfer any or all of the Investment
Property into its name or that of its nominee and may exercise all
voting rights with respect to the Investment Property, but no such
transfer shall constitute a taking of such Investment Property in
satisfaction of any or all of the Obligations, and (B) Agent shall
be entitled to receive, for application to the Obligations, all
cash or stock dividends and distributions, interest and premiums
declared or paid on the Investment Property.

 

11.2. Agent’s
Discretion. Agent shall have
the right in its sole discretion to determine which rights, Liens,
security interests or remedies Agent may at any time pursue,
relinquish, subordinate, or modify, which procedures, timing and
methodologies to employ, and what any other action to take with
respect to any or all of the Collateral and in what order, thereto
and such determination will not in any way modify or affect any of
Agent’s or Lenders’ rights hereunder as against the
Loan Parties or each other.

 

11.3. Setoff. Subject to
Section 14.13 hereof, in addition to any other rights which Agent
or any Lender may have under Applicable Law, upon the occurrence
and during the continuation of an Event of Default hereunder, Agent
and such Lender shall have a right, immediately and without notice
of any kind, to apply any Loan Party’s property held by Agent
and such Lender or any of their Affiliates to reduce the
Obligations and to exercise any and all rights of setoff which may
be available to Agent and such Lender with respect to any deposits
held by Agent or such Lender.

 

11.4. Rights and Remedies not
Exclusive. The enumeration
of the foregoing rights and remedies is not intended to be
exhaustive and the exercise of any rights or remedy shall not
preclude the exercise of any other right or remedies provided for
herein or otherwise provided by law, all of which shall be
cumulative and not alternative.

 

11.5. Allocation of Payments After Event of
Default.

 

(a) Notwithstanding
any other provisions of this Agreement to the contrary, after the
occurrence and during the continuance of an Event of Default, all
amounts collected or received by Agent on account of the
Obligations (including without limitation any amounts on account of
any of Cash Management Liabilities or Hedge Liabilities), or in
respect of the Collateral may, at Agent’s discretion, and
shall, at the direction of the Required Lenders, be paid over or
delivered as follows:

 

FIRST,
to the payment of all out-of-pocket costs and expenses (including
reasonable attorneys’ fees) of Agent in connection with
enforcing its rights and the rights of Lenders under this Agreement
and the Other Documents, and any Out-of-Formula Loans and
Protective Advances funded by Agent with respect to the Collateral
under or pursuant to the terms of this Agreement;

 

SECOND,
to payment of any fees owed to Agent;

 

THIRD,
to the payment of all out-of-pocket costs and expenses (including
reasonable attorneys’ fees) of each of the Lenders to the
extent owing to such Lenders pursuant to the terms of this
Agreement;

 

 

 

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FOURTH,
to the payment of all of the Obligations consisting of accrued
interest on account of the Swing Loans;

 

FIFTH,
to the payment of the outstanding principal amount of the
Obligations consisting of Swing Loans;

 

SIXTH,
to the payment of all Obligations arising under this Agreement and
the Other Documents consisting of accrued fees and interest (other
than interest in respect of Swing Loans paid pursuant to clause
FOURTH above);

 

SEVENTH, to the
payment of the outstanding principal amount of the Obligations
(other than principal in respect of Swing Loans paid pursuant to
clause FIFTH above) arising under this Agreement, including Cash
Management Liabilities and Hedge Liabilities (to the extent
reserves for such Cash Management Liabilities and Hedge Liabilities
have been established by Agent) and the payment or cash
collateralization of any outstanding Letters of Credit in
accordance with Section 3.2(b) hereof;

 

EIGHTH,
to all other Obligations arising under this Agreement, under the
Other Documents or otherwise which shall have become due and
payable and not repaid pursuant to clauses “FIRST”
through “SEVENTH” above; and

 

NINTH,
to the payment of the surplus, if any, to whoever may be lawfully
entitled to receive such surplus.

 

(b) In carrying out
the foregoing, (i) amounts received shall be applied in the
numerical order provided until exhausted prior to application to
the next succeeding category; (ii) each of the Lenders shall
receive (so long as it is not a Defaulting Lender) an amount equal
to its pro rata share (based on the proportion that the then
outstanding Advances, Cash Management Liabilities and Hedge
Liabilities held by such Lender bears to the aggregate then
outstanding Advances, Cash Management Liabilities and Hedge
Liabilities) of amounts available to be applied pursuant to clauses
“SIXTH”, “SEVENTH”, “EIGHTH”
and “NINTH” of subsection (a) above;
(iii) notwithstanding anything to the contrary in this Section
11.5, no Swap Obligations of any Non-Qualifying Party shall be paid
with amounts received from such Non-Qualifying Party under its
Guaranty (including sums received as a result of the exercise of
remedies with respect to such Guaranty) or from the proceeds of
such Non-Qualifying Party’s Collateral if such Swap
Obligations would constitute Excluded Hedge Liabilities, provided,
however, that to the extent possible appropriate adjustments shall
be made with respect to payments and/or the proceeds of Collateral
from other Loan Parties that are Eligible Contract Participants
with respect to such Swap Obligations to preserve the allocation to
Obligations otherwise set forth above in this Section 11.5; and
(iv) to the extent that any amounts available for distribution
pursuant to clause “SEVENTH” of subsection (a) above
are attributable to the issued but undrawn amount of outstanding
Letters of Credit, such amounts shall be held by Agent as cash
collateral for the Letters of Credit pursuant to Section 3.2(b)
hereof and applied (A) first, to reimburse Issuer from time to time
for any drawings under such Letters of Credit and (B) then,
following the expiration of all Letters of Credit, to all other
Obligations of the types described in clauses “SEVENTH”
and “EIGHTH” of subsection (a) above in the manner
provided in this Section 11.5.

 

XII. WAIVERS AND
JUDICIAL PROCEEDINGS.

 

12.1. Waiver of
Notice. Each Loan Party
hereby waives notice of non-payment of any of the Receivables,
demand, presentment, protest and notice thereof with respect to any
and all instruments, notice of acceptance hereof, notice of loans
or advances made, credit extended, Collateral received or
delivered, or any other action taken in reliance hereon, and all
other demands and notices of any description, except such as are
expressly provided for herein.

 

12.2. Delay. No delay or
omission on Agent’s or any Lender’s part in exercising
any right, remedy or option shall operate as a waiver of such or
any other right, remedy or option or of any Default or Event of
Default.

 

 

 

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12.3. Jury
Waiver. EACH PARTY TO
THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY
OF ANY CLAIM, COUNTERCLAIM, DEMAND, ACTION OR CAUSE OF ACTION (A)
ARISING UNDER THIS AGREEMENT, ANY OTHER DOCUMENT OR ANY OTHER
INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN
CONNECTION HEREWITH, OR (B) IN ANY WAY CONNECTED WITH OR RELATED OR
INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM
WITH RESPECT TO THIS AGREEMENT, ANY OTHER DOCUMENT OR ANY OTHER
INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN
CONNECTION HEREWITH, OR THE TRANSACTIONS RELATED HERETO OR THERETO
IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER
SOUNDING IN CONTRACT OR TORT OR OTHERWISE AND EACH PARTY HEREBY
CONSENTS THAT ANY SUCH CLAIM, COUNTERCLAIM, DEMAND, ACTION OR CAUSE
OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT
ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A
COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE
CONSENTS OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO
TRIAL BY JURY.

 

XIII. EFFECTIVE DATE AND
TERMINATION.

 

13.1. Term. This Agreement,
which shall inure to the benefit of and shall be binding upon the
respective successors and permitted assigns of each Loan Party,
Agent and each Lender, shall become effective on the Closing Date
and shall continue in full force and effect until April 30, 2022
(the “Term”) unless sooner terminated as herein
provided. The Loan Parties may terminate this Agreement at any time
upon thirty (30) days prior written notice to Agent (unless such
time period is shortened by Agent pursuant to its written consent)
so long as the Obligations are Paid in Full in connection
therewith.

 

13.2. Termination. The termination
of this Agreement shall not affect Agent’s or any
Lender’s rights, or any of the Obligations having their
inception prior to the effective date of such termination or any
Obligations which pursuant to the terms hereof continue to accrue
after such date, and the provisions hereof shall continue to be
fully operative until (a) all of the Obligations have been Paid in
Full and the Commitments and this Agreement have been terminated,
and (b) each of the Loan Parties has released the Secured
Parties from and against any and all claims of any nature
whatsoever that any Loan Party may have against the Secured
Parties. The security interests, Liens and rights granted to Agent
and Lenders hereunder and the financing statements filed in
connection herewith shall continue in full force and effect,
notwithstanding the termination of this Agreement or the fact that
Borrowers’ Account may from time to time be temporarily in a
zero or credit position, until all of the Obligations have been
Paid in Full after the termination of this Agreement or each Loan
Party has provided Agent and Lenders with an indemnification
satisfactory to Agent and Lenders with respect thereto.
Accordingly, each Loan Party waives any rights which it may have
under the Uniform Commercial Code to demand the filing of
termination statements with respect to the Collateral, and Agent
shall not be required to send such termination statements to any
Loan Party, or to file them with any filing office, unless and
until this Agreement shall have been terminated in accordance with
its terms, the Commitments have been terminated and all of the
Obligations have been Paid in Full. All representations,
warranties, covenants, waivers and agreements set forth herein
shall survive termination hereof until the Payment in Full of the
Obligations, the termination of the Commitments and the termination
of this Agreement.

 

XIV. REGARDING
AGENT.

 

14.1. Appointment. Each Lender
hereby designates PNC to act as Agent for such Lender under this
Agreement and the Other Documents. Each Lender hereby irrevocably
authorizes Agent to take such action on its behalf under the
provisions of this Agreement and the Other Documents and to
exercise such powers and to perform such duties hereunder and
thereunder as are specifically delegated to or required of Agent by
the terms hereof and thereof and such other powers as are
reasonably incidental thereto and Agent shall hold all Collateral,
payments of principal and interest, fees (except the fees set forth
in Sections 2.8(b), 3.3(a) and 3.4 hereof and the Fee Letter),
charges and collections received pursuant to this Agreement, for
the ratable benefit of Lenders. Agent may perform any of its duties
hereunder by or through its agents or employees. As to any matters
not expressly provided for by this Agreement, Agent shall not be
required to exercise any discretion or take any action, but shall
be required to act or to refrain from acting (and shall be fully
protected in so acting or refraining from acting) upon the
instructions of Required Lenders, and such instructions shall be
binding; provided, however, that Agent shall not be required to
take any action which, in Agent’s discretion, exposes Agent
to liability or which is contrary to this Agreement or the Other
Documents or Applicable Law unless Agent is provided with an
indemnification reasonably satisfactory to Agent with respect
thereto.

 

 

 

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14.2. Nature
of Duties. Agent shall have
no duties or responsibilities except those expressly set forth in
this Agreement and the Other Documents. Neither Agent nor any of
its officers, directors, employees or agents shall be (i) liable
for any action taken or omitted by them as such hereunder or in
connection herewith, unless caused by their gross (not mere)
negligence or willful misconduct (as determined by a court of
competent jurisdiction in a final and non-appealable judgment or
order), or (ii) responsible in any manner for any recitals,
statements, representations or warranties made by any Loan Party or
any officer thereof set forth in this Agreement, or in any of the
Other Documents or in any certificate, report, statement or other
document referred to or provided for in, or received by Agent under
or in connection with, this Agreement or any of the Other Documents
or for the value, validity, effectiveness, genuineness, due
execution, enforceability or sufficiency of this Agreement, or any
of the Other Documents or for any failure of any Loan Party to
perform its obligations hereunder. Agent shall not be under any
obligation to any Lender to ascertain or to inquire as to the
observance or performance of any of the agreements set forth in, or
conditions of, this Agreement or any of the Other Documents, or to
inspect the properties, books or records of any Loan Party. The
duties of Agent as respects the Advances to the Borrowers shall be
mechanical and administrative in nature. Agent shall not have by
reason of this Agreement a fiduciary relationship in respect of any
Lender; and nothing in this Agreement, expressed or implied, is
intended to or shall be so construed as to impose upon Agent any
obligations in respect of this Agreement or the transactions
described herein except as expressly set forth herein.

 

14.3. Lack of Reliance on
Agent. Independently and
without reliance upon Agent or any other Lender, each Lender has
made and shall continue to make (a) its own independent
investigation of the financial condition and affairs of each Loan
Party in connection with the making and the continuance of the
Advances hereunder and the taking or not taking of any action in
connection herewith, and (b) its own appraisal of the
creditworthiness of each Loan Party. Agent shall have no duty or
responsibility, either initially or on a continuing basis, to
provide any Lender with any credit or other information with
respect thereto, whether coming into its possession before making
of the Advances or at any time or times thereafter except as shall
be provided by any Loan Party pursuant to the terms hereof. Agent
shall not be responsible to any Lender for any recitals,
statements, information, representations or warranties herein or in
any agreement, document, certificate or a statement delivered in
connection with or for the execution, effectiveness, genuineness,
validity, enforceability, collectability or sufficiency of this
Agreement or any Other Document, or of the financial condition of
any Loan Party, or be required to make any inquiry concerning
either the performance or observance of any of the terms,
provisions or conditions of this Agreement, the Notes, the Other
Documents or the financial condition or prospects of any Loan
Party, or the existence of any Event of Default or any
Default.

 

 

 

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14.4. Resignation
of Agent; Successor Agent. Agent may resign
on thirty (30) days written notice to each Lender and Borrowing
Agent and upon such resignation, Required Lenders will promptly
designate a successor Agent reasonably satisfactory to Borrowing
Agent (provided that no such approval by Borrowing Agent shall be
required (i) in any case where the successor Agent is one of the
Lenders or (ii) after the occurrence and during the continuance of
any Event of Default). Any such successor Agent shall succeed to
the rights, powers and duties of Agent, and shall in particular
succeed to all of Agent’s right, title and interest in and to
all of the Liens in the Collateral securing the Obligations created
hereunder or any Other Document, and the term “Agent”
shall mean such successor agent effective upon its appointment, and
the former Agent’s rights, powers and duties as Agent shall
be terminated, without any other or further act or deed on the part
of such former Agent. However, notwithstanding the foregoing, if at
the time of the effectiveness of the new Agent’s appointment,
any further actions need to be taken in order to provide for the
legally binding and valid transfer of any Liens in the Collateral
from former Agent to new Agent and/or for the perfection of any
Liens in the Collateral as held by new Agent or it is otherwise not
then possible for new Agent to become the holder of a fully valid,
enforceable and perfected Lien as to any of the Collateral, former
Agent shall continue to hold such Liens solely as agent for
perfection of such Liens on behalf of new Agent until such time as
new Agent can obtain a fully valid, enforceable and perfected Lien
on all Collateral, provided that Agent shall not be required to or
have any liability or responsibility to take any further actions
after such date as such agent for perfection to continue the
perfection of any such Liens (other than to forego from taking any
affirmative action to release any such Liens). After Agent’s
resignation as Agent, the provisions of this Article XIV, and any
indemnification rights under this Agreement, including without
limitation, rights arising under Section 16.5 hereof, shall inure
to its benefit as to any actions taken or omitted to be taken by it
while it was Agent under this Agreement (and in the event resigning
Agent continues to hold any Liens pursuant to the provisions of the
immediately preceding sentence, the provisions of this Article XIV
and any indemnification rights under this Agreement, including
without limitation, rights arising under Section 16.5 hereof, shall
inure to its benefit as to any actions taken or omitted to be taken
by it in connection with such Liens).

 

14.5. Certain Rights of
Agent. If Agent shall
request instructions from Lenders with respect to any act or action
(including failure to act) in connection with this Agreement or any
Other Document, Agent shall be entitled to refrain from such act or
taking such action unless and until Agent shall have received
instructions from Required Lenders; and Agent shall not incur
liability to any Person by reason of so refraining. Without
limiting the foregoing, Lenders shall not have any right of action
whatsoever against Agent as a result of its acting or refraining
from acting hereunder in accordance with the instructions of
Required Lenders.

 

14.6. Reliance. Agent shall be
entitled to rely, and shall be fully protected in relying, upon any
note, writing, resolution, notice, statement, certificate, email,
facsimile or telecopier message, order or other document or
telephone message believed by it to be genuine and correct and to
have been signed, sent or made by the proper person or entity, and,
with respect to all legal matters pertaining to this Agreement and
the Other Documents and its duties hereunder, upon advice of
counsel selected by it. Agent may employ agents and
attorneys-in-fact and shall not be liable for the default or
misconduct of any such agents or attorneys-in-fact selected by
Agent with reasonable care.

 

14.7. Notice of
Default. Agent shall not
be deemed to have knowledge or notice of the occurrence of any
Default or Event of Default hereunder or under the Other Documents,
unless Agent has received notice from a Lender or Borrowing Agent
referring to this Agreement or the Other Documents, describing such
Default or Event of Default and stating that such notice is a
“notice of default”. In the event that Agent receives
such a notice, Agent shall give notice thereof to Lenders. Agent
shall take such action with respect to such Default or Event of
Default as shall be reasonably directed by Required Lenders;
provided, that, unless and until Agent shall have received such
directions, 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 in the best
interests of Lenders.

 

 

 

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14.8. Indemnification.
To the extent Agent is not reimbursed and indemnified by the Loan
Parties, each Lender will reimburse and indemnify Agent in
proportion to its respective portion of the outstanding Advances
and its respective Participation Commitments in the outstanding
Letters of Credit and outstanding Swing Loans (or, if no Advances
are outstanding, pro rata according to the percentage that its
Revolving Commitment Amount constitutes of the total aggregate
Revolving Commitment Amounts), from and against any and all
liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever which may be imposed on, incurred by or asserted
against Agent in performing its duties hereunder, or in any way
relating to or arising out of this Agreement or any Other Document;
provided that Lenders shall not be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from
Agent’s gross (not mere) negligence or willful misconduct (as
determined by a court of competent jurisdiction in a final and
non-appealable judgment or order).

 

14.9. Agent in its Individual
Capacity. With respect to
the obligation of Agent to lend under this Agreement, the Advances
made by it shall have the same rights and powers hereunder as any
other Lender and as if it were not performing the duties as Agent
specified herein; and the term “Lender” or any similar
term shall, unless the context clearly otherwise indicates, include
Agent in its individual capacity as a Lender. Agent may engage in
business with any Loan Party as if it were not performing the
duties specified herein, and may accept fees and other
consideration from any Loan Party for services in connection with
this Agreement or otherwise without having to account for the same
to Lenders.

 

14.10. Delivery of
Documents. To the extent
Agent receives financial statements required under Sections 9.7,
9.8, 9.9, 9.12 and 9.13 hereof or Borrowing Base Certificates from
any Loan Party pursuant to the terms of this Agreement which any
Loan Party is not obligated to deliver to each Lender, Agent will
promptly provide such documents and information to
Lenders.

 

14.11. Loan Parties Undertaking to
Agent. Without prejudice
to their respective obligations to Lenders under the other
provisions of this Agreement, each Loan Party hereby undertakes
with Agent to pay to Agent from time to time on demand all amounts
from time to time due and payable by it for the account of Agent or
Lenders or any of them pursuant to this Agreement to the extent not
already paid. Any payment made pursuant to any such demand shall
pro tanto satisfy the relevant Loan Party’s obligations to
make payments for the account of Lenders or the relevant one or
more of them pursuant to this Agreement.

 

14.12. No Reliance on Agent’s Customer
Identification Program. To the extent the
Advances or this Agreement is, or becomes, syndicated in
cooperation with other Lenders, each Lender acknowledges and agrees
that neither such Lender, nor any of its Affiliates, participants
or assignees, may rely on Agent to carry out such Lender's,
Affiliate's, participant's or assignee's customer identification
program, or other obligations required or imposed under or pursuant
to the USA PATRIOT Act or the regulations thereunder, including the
regulations contained in 31 CFR 103.121 (as hereafter amended,
modified, supplemented or replaced, the “CIP
Regulations”), or any other Anti-Terrorism Law, including any
programs involving any of the following items relating to or in
connection with any of the Loan Parties, their Affiliates or their
agents, the Other Documents or the transactions hereunder or
contemplated hereby: (i) any identity verification procedures, (ii)
any recordkeeping, (iii) comparisons with government lists, (iv)
customer notices or (v) other procedures required under the CIP
Regulations or such Anti-Terrorism Laws.

 

14.13. Other
Agreements. Each of the
Lenders agrees that it shall not, without the prior written consent
of Agent, and that it shall, to the extent it is lawfully entitled
to do so, upon the request of Agent, set off against the
Obligations, any amounts owing by such Lender to any Loan Party or
any deposit accounts of any Loan Party now or hereafter maintained
with such Lender. Anything in this Agreement to the contrary
notwithstanding, each of the Lenders further agrees that it shall
not, unless specifically requested to do so by Agent, take any
action to protect or enforce its rights arising out of this
Agreement or the Other Documents, it being the intent of Lenders
that any such action to protect or enforce rights under this
Agreement and the Other Documents shall be taken in concert and at
the direction or with the consent of Agent or Required
Lenders.

 

 

 

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XV. BORROWING
AGENCY.

 

15.1. Borrowing Agency
Provisions.

 

(a) Each Loan Party
hereby irrevocably designates Borrowing Agent to be its attorney
and agent and in such capacity, whether verbally, in writing or
through electronic methods (including, without limitation, an
Approved Electronic Communication), to (i) borrow, (ii) request
advances, (iii) request the issuance of Letters of Credit, (iv)
sign and endorse notes, (v) execute and deliver all instruments,
documents, applications, security agreements, reimbursement
agreements and letter of credit agreements for Letters of Credit
and all other agreements, documents, instruments, certificates,
notices and further assurances now or hereafter required hereunder,
(vi) make elections regarding interest rates, (vii) give
instructions regarding Letters of Credit and agree with Issuer upon
any amendment, extension or renewal of any Letter of Credit and
(viii) otherwise take action under and in connection with this
Agreement and the Other Documents, all on behalf of and in the name
of such Loan Party or the Loan Parties, and hereby authorizes Agent
to pay over or credit all loan proceeds hereunder in accordance
with the request of Borrowing Agent.

 

(b) The handling of
this credit facility as a co-borrowing facility with a borrowing
agent in the manner set forth in this Agreement is solely as an
accommodation to the Loan Parties and at their request. Neither
Agent nor any Lender shall incur liability to the Loan Parties as a
result thereof. To induce Agent and Lenders to do so and in
consideration thereof, each Loan Party hereby indemnifies Agent and
each Lender and holds Agent and each Lender harmless from and
against any and all liabilities, expenses, losses, damages and
claims of damage or injury asserted against Agent or any Lender by
any Person arising from or incurred by reason of the handling of
the financing arrangements of the Loan Parties as provided herein,
reliance by Agent or any Lender on any request or instruction from
Borrowing Agent or any other action taken by Agent or any Lender
with respect to this Section 15.1 except due to willful misconduct
or gross (not mere) negligence by the indemnified party (as
determined by a court of competent jurisdiction in a final and
non-appealable judgment or order).

 

(c) All Obligations
shall be joint and several, and each Loan Party shall make payment
upon the maturity of the Obligations by acceleration or otherwise,
and such obligation and liability on the part of each Loan Party
shall in no way be affected by any extensions, renewals and
forbearance granted by Agent or any Lender to any Loan Party,
failure of Agent or any Lender to give any Loan Party notice of
borrowing or any other notice, any failure of Agent or any Lender
to pursue or preserve its rights against any Loan Party, the
release by Agent or any Lender of any Collateral now or thereafter
acquired from any Loan Party, and such agreement by each Loan Party
to pay upon any notice issued pursuant thereto is unconditional and
unaffected by prior recourse by Agent or any Lender to the other
Loan Parties or any Collateral for such Loan Party’s
Obligations or the lack thereof. Each Loan Party waives all
suretyship defenses (other than Payment in Full of the
Obligations).

 

15.2. Waiver of
Subrogation. Each Loan Party
expressly waives any and all rights of subrogation, reimbursement,
indemnity, exoneration, contribution of any other claim which such
Loan Party may now or hereafter have against the other Loan Parties
or any other Person directly or contingently liable for the
Obligations hereunder, or against or with respect to any other Loan
Parties’ property (including, without limitation, any
property which is Collateral for the Obligations), arising from the
existence or performance of this Agreement, until the termination
of the Commitments, the termination of this Agreement and the
Payment in Full of the Obligations.

 

 

 

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XVI. MISCELLANEOUS.

 

16.1. Governing Law; Judicial Reference;
California Specific Waivers.

 

(a) Governing Law. This Agreement
and each Other Document (unless and except to the extent expressly
provided otherwise in any such Other Document), and all matters
relating hereto or thereto or arising herefrom or therefrom
(whether arising under contract law, tort law or otherwise) shall,
in accordance with Section 5-1401 of the General Obligations Law of
the State of New York, be governed by and construed in accordance
with the laws of the State of New York. Any judicial proceeding
brought by or against any Loan Party with respect to any of the
Obligations, this Agreement or any of the Other Documents may be
brought in any court of competent jurisdiction in the State of New
York, United States of America, and, by execution and delivery of
this Agreement, each Loan Party accepts for itself and in
connection with its properties, generally and unconditionally, the
non-exclusive jurisdiction of the aforesaid courts, and irrevocably
agrees to be bound by any judgment rendered thereby in connection
with this Agreement. Each Loan Party hereby waives personal service
of any and all process upon it and consents that all such service
of process may be made by certified or registered mail (return
receipt requested) directed to Borrowing Agent at its address set
forth in Section 16.6 hereof and service so made shall be deemed
completed five (5) days after the same shall have been so deposited
in the mails of the United States of America, or, at Agent’s
option, by service upon Borrowing Agent which each Loan Party
irrevocably appoints as such Loan Party’s agent for the
purpose of accepting service within the State of New York. Nothing
herein shall affect the right to serve process in any manner
permitted by law or shall limit the right of Agent or any Lender to
bring proceedings against any Loan Party in the courts of any other
jurisdiction. Each Loan Party waives any objection to jurisdiction
and venue of any action instituted hereunder and shall not assert
any defense based on lack of jurisdiction or venue or based upon
forum non conveniens. Each Loan Party waives the right to remove
any judicial proceeding brought against such Loan Party in any
state court to any federal court. Any judicial proceeding by any
Loan Party against Agent or any Lender involving, directly or
indirectly, any matter or claim in any way arising out of, related
to or connected with this Agreement or any of the Other Documents,
shall be brought only in a federal or state court located in the
County of New York, State of New York.

 

(b) Judicial Reference. IN THE
EVENT THAT, NOTWITHSTANDING THE PROVISIONS OF SECTION 16.1(a) TO
THE CONTRARY, ANY ACTION RELATED HERETO IS COMMENCED OR MAINTAINED
IN ANY COURT IN THE STATE OF CALIFORNIA, AND THE WAIVER OF JURY
TRIAL SET FORTH IN SECTION 12.3 IS NOT ENFORCEABLE, AND EACH PARTY
TO SUCH ACTION DOES NOT SUBSEQUENTLY WAIVE IN AN EFFECTIVE MANNER
UNDER CALIFORNIA LAW ITS RIGHT TO A TRIAL BY JURY, THE PARTIES
HERETO HEREBY ELECT TO PROCEED AS FOLLOWS:

 

(i) WITH THE EXCEPTION
OF THE ITEMS SPECIFIED IN CLAUSE (ii) BELOW, ANY CONTROVERSY,
DISPUTE OR CLAIM (EACH, A “CONTROVERSY”) BETWEEN
THE PARTIES ARISING OUT OF OR RELATING TO THIS AGREEMENT WILL BE
RESOLVED BY A REFERENCE PROCEEDING IN ACCORDANCE WITH THE
PROVISIONS OF SECTIONS 638, ET SEQ. OF THE CALIFORNIA CODE OF CIVIL
PROCEDURE (“CCP”), OR THEIR
SUCCESSOR SECTIONS, WHICH SHALL CONSTITUTE THE EXCLUSIVE REMEDY FOR
THE RESOLUTION OF ANY CONTROVERSY, INCLUDING WHETHER THE
CONTROVERSY IS SUBJECT TO THE REFERENCE PROCEEDING. EXCEPT AS
OTHERWISE PROVIDED ABOVE, VENUE FOR THE REFERENCE PROCEEDING WILL
BE IN ANY COURT IN WHICH VENUE IS APPROPRIATE UNDER APPLICABLE LAW
(THE “COURT”).

 

 

 

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(ii) THE MATTERS THAT
SHALL NOT BE SUBJECT TO A REFERENCE PROCEEDING ARE THE FOLLOWING:
(A) NON-JUDICIAL FORECLOSURE OF ANY SECURITY INTERESTS IN REAL OR
PERSONAL PROPERTY; (B) EXERCISE OF SELF HELP REMEDIES (INCLUDING
SET-OFF); (C) APPOINTMENT OF A RECEIVER; AND (D) TEMPORARY,
PROVISIONAL OR ANCILLARY REMEDIES (INCLUDING WRITS OF ATTACHMENT,
WRITS OF POSSESSION, TEMPORARY RESTRAINING ORDERS OR PRELIMINARY
INJUNCTIONS). THIS AGREEMENT DOES NOT LIMIT THE RIGHT OF ANY PARTY
TO EXERCISE OR OPPOSE ANY OF THE RIGHTS AND REMEDIES DESCRIBED IN
CLAUSES (A) AND (B) OR TO SEEK OR OPPOSE FROM A COURT OF COMPETENT
JURISDICTION ANY OF THE ITEMS DESCRIBED IN CLAUSES (C) AND (D). THE
EXERCISE OF, OR OPPOSITION TO, ANY OF THOSE ITEMS DOES NOT WAIVE
THE RIGHT OF ANY PARTY TO A REFERENCE PURSUANT TO THIS
AGREEMENT.

 

(iii) THE REFEREE SHALL
BE A RETIRED JUDGE OR JUSTICE SELECTED BY MUTUAL WRITTEN AGREEMENT
OF THE PARTIES. IF THE PARTIES DO NOT AGREE WITHIN TEN (10) DAYS OF
A WRITTEN REQUEST TO DO SO BY ANY PARTY, THEN, UPON REQUEST OF ANY
PARTY, THE REFEREE SHALL BE SELECTED BY THE PRESIDING JUDGE OF THE
COURT (OR HIS OR HER REPRESENTATIVE). A REQUEST FOR APPOINTMENT OF
A REFEREE MAY BE HEARD ON AN EX PARTE OR EXPEDITED BASIS, AND THE
PARTIES AGREE THAT IRREPARABLE HARM WOULD RESULT IF EX PARTE RELIEF
IS NOT GRANTED.

 

(iv) EXCEPT AS
EXPRESSLY SET FORTH IN THIS AGREEMENT, THE REFEREE SHALL DETERMINE
THE MANNER IN WHICH THE REFERENCE PROCEEDING IS CONDUCTED INCLUDING
THE TIME AND PLACE OF HEARINGS, THE ORDER OF PRESENTATION OF
EVIDENCE, AND ALL OTHER QUESTIONS THAT ARISE WITH RESPECT TO THE
COURSE OF THE REFERENCE PROCEEDING. ALL PROCEEDINGS AND HEARINGS
CONDUCTED BEFORE THE REFEREE, EXCEPT FOR TRIAL, SHALL BE CONDUCTED
WITHOUT A COURT REPORTER, EXCEPT THAT WHEN ANY PARTY SO REQUESTS, A
COURT REPORTER WILL BE USED AT ANY HEARING CONDUCTED BEFORE THE
REFEREE, AND THE REFEREE WILL BE PROVIDED A COURTESY COPY OF THE
TRANSCRIPT. THE PARTY MAKING SUCH A REQUEST SHALL HAVE THE
OBLIGATION TO ARRANGE FOR THE COURT REPORTER. SUBJECT TO THE
REFEREE’S POWER TO AWARD COSTS TO THE PREVAILING PARTY,
BORROWER WILL PAY THE COST OF THE REFEREE AND ALL COURT
REPORTERS.

 

(v) THE REFEREE SHALL
BE REQUIRED TO DETERMINE ALL ISSUES IN ACCORDANCE WITH EXISTING
APPLICABLE CASE LAW AND STATUTORY LAW. THE RULES OF EVIDENCE
APPLICABLE TO PROCEEDINGS AT LAW IN THE COURT WILL BE APPLICABLE TO
THE REFERENCE PROCEEDING. THE REFEREE SHALL BE EMPOWERED TO ENTER
EQUITABLE AS WELL AS LEGAL RELIEF, ENTER EQUITABLE ORDERS THAT WILL
BE BINDING ON THE PARTIES AND RULE ON ANY MOTION THAT WOULD BE
AUTHORIZED IN A COURT PROCEEDING. THE REFEREE SHALL ISSUE A
DECISION AT THE CLOSE OF THE REFERENCE PROCEEDING WHICH DISPOSES OF
ALL CLAIMS OF THE PARTIES THAT ARE THE SUBJECT OF THE REFERENCE.
PURSUANT TO CCP SECTION 644, SUCH DECISION SHALL BE ENTERED BY THE
COURT AS A JUDGMENT OR AN ORDER IN THE SAME MANNER AS IF THE ACTION
HAD BEEN TRIED BY THE COURT AND ANY SUCH DECISION WILL BE FINAL,
BINDING AND CONCLUSIVE. THE PARTIES RESERVE THE RIGHT TO APPEAL
FROM THE FINAL JUDGMENT OR ORDER OR FROM ANY APPEALABLE DECISION OR
ORDER ENTERED BY THE REFEREE. THE PARTIES RESERVE THE RIGHT TO
FINDINGS OF FACT, CONCLUSIONS OF LAWS, A WRITTEN STATEMENT OF
DECISION, AND THE RIGHT TO MOVE FOR A NEW TRIAL OR A DIFFERENT
JUDGMENT, WHICH NEW TRIAL, IF GRANTED, IS ALSO TO BE A REFERENCE
PROCEEDING UNDER THIS PROVISION.

 

 

 

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(vi) THE PROVISIONS OF
THIS SECTION 16.1(b) ARE INCLUDED OUT OF AN ABUNDANCE OF CAUTION
AND NEITHER THE INCLUSION OF THIS SECTION 16.1(b), NOR ANY
REFERENCE TO CALIFORNIA LAW CONTAINED HEREIN SHALL BE EITHER (A)
DEEMED TO AFFECT OR LIMIT IN ANY WAY THE PARTIES’ CHOICE OF
LAW PURSUANT TO SECTION 10.16 HEREOF OR (B) CONSTRUED TO MEAN THAT
ANY PROVISIONS OF CALIFORNIA LAW ARE IN ANY WAY APPLICABLE TO THIS
AGREEMENT OR THE OBLIGATIONS.

 

(c) California Specific Waivers.
Without limiting the generality of any other waiver set forth
herein, each Loan Party hereby:

 

(i)  expressly
waives (i) any and all benefits which might otherwise be available
to such Loan Party under California Civil Code Sections 2809, 2810,
2819, 2839, 2845 through 2847, 2849, 2850, 2899 and 3433 and (ii)
any defense based upon an election of remedies by the Agent,
including, without limitation, any election to proceed by judicial
or nonjudicial foreclosure of any lien granted under the Other
Documents, whether on real property or personal property, or by
deed in lieu thereof, and whether or not every aspect of any
foreclosure sale is commercially reasonable, or any election of
remedies, including but not limited to, remedies relating to real
property or personal property security, that destroys or otherwise
impairs any subrogation rights of any guarantor or the rights of
any guarantor to proceed against the Loan Parties or any other
guarantor of the Obligations for reimbursement, or both (including
California Code of Civil Procedure Sections 580a, 580b, 580d and
726).

 

(ii) acknowledges its
understanding that: (i) Section 580d of the California Code of
Civil Procedure generally prohibits a deficiency judgment against a
borrower after a non-judicial foreclosure; (ii) such Loan
Party’s subrogation rights may be destroyed by a non-judicial
foreclosure under any mortgage (because such Loan party may not be
able to pursue any other borrower or guarantor for a deficiency
judgment by reason of the application of Section 580d of the
California Code of Civil Procedure); and (iii) under Union Bank v.
Gradsky, 265 Cal. App. 2nd 40 (1968) and Cathay Bank v. Lee, 14
Cal.App.4th 1533 (1993), a lender may be estopped from pursuing a
guarantor for a deficiency judgment after a non-judicial
foreclosure (on the theory that a guarantor should be exonerated if
a lender materially alters the original obligation of the principal
without the consent of the guarantor or elects remedies for default
which impair the subrogation, reimbursement or contribution rights
of a “surety” or other co-obligor) absent an explicit
waiver; and

 

(iii) acknowledges that
the provisions in this Section 16.1(c) which refer to certain
sections of the California Civil Code and the California Code of
Civil Procedure are included in this Agreement solely out of an
abundance of caution and shall not be construed to mean that any of
the above referenced provisions of California law are in any way
applicable to this Agreement: notwithstanding such provisions, this
Agreement shall be governed by, and construed in accordance with,
the laws of the State of New York, as provided in Section
16.1(a).

 

16.2. Entire
Understanding.

 

(a) This Agreement and
the Other Documents contain the entire understanding between each
Loan Party, Agent and each Lender and supersedes all prior
agreements and understandings, if any, relating to the subject
matter hereof. Any promises, representations, warranties or
guarantees not set forth herein and hereinafter made shall have no
force and effect unless in writing, signed by each Loan
Party’s, Agent’s and each Lender’s respective
officers. Neither this Agreement nor any portion or provisions
hereof may be amended, modified, changed, waived, supplemented,
discharged, cancelled or terminated orally or by any course of
dealing, or in any manner other than by an agreement in writing,
signed by the party to be charged. Notwithstanding the foregoing,
Agent may modify this Agreement or any of the Other Documents for
the purposes of completing missing content or correcting erroneous
content of an administrative nature, without the need for a written
amendment, provided that Agent shall send a copy of any such
modification to the Borrowers and each Lender (which copy may be
provided by electronic mail). Each Loan Party acknowledges that it
has been advised by counsel in connection with the execution of
this Agreement and Other Documents and is not relying upon oral
representations or statements inconsistent with the terms and
provisions of this Agreement.

 

 

 

-92-

 

 

(b) Required Lenders,
Agent with the consent in writing of Required Lenders, and the Loan
Parties may, subject to the provisions of this Section 16.2(b),
from time to time enter into any written amendments to this
Agreement or any of the Other Documents or any other supplemental
agreements, documents or instruments for the purpose of adding or
deleting any provisions or otherwise amending, modifying,
supplementing, changing, varying or waiving in any manner the
conditions, provisions or terms hereof or thereof or waiving any
Event of Default hereunder or thereunder, but only to the extent
specified in such written amendments or other agreements, documents
or instruments; provided, however, that no such amendment, or other
agreement, document or instrument shall:

 

(i) increase the
Revolving Commitment Percentage, or the maximum dollar amount of
the Revolving Commitment Amount of any Lender without the consent
of such Lender directly affected thereby;

 

(ii) whether or not any
Advances are outstanding, extend the Term or the time for payment
of principal or interest of any Advance (excluding the due date of
any mandatory prepayment of an Advance), or any fee payable to any
Lender, or reduce the principal amount of or the rate of interest
borne by any Advances or reduce any fee payable to any Lender,
without the consent of each Lender directly affected thereby
(except that Required Lenders may elect to waive or rescind any
imposition of the Default Rate under Section 3.1 hereof or of
default rates of Letter of Credit fees under Section 3.2 hereof
(unless imposed by Agent in which case Agent alone may elect to
waive or rescind such imposition of such rates));

 

(iii) increase the
Maximum Revolving Advance Amount without the consent of all
Lenders;

 

(iv) alter the
definition of the term “Required Lenders” or alter,
amend or modify this Section 16.2(b) without the consent of all
Lenders;

 

(v) alter, amend or
modify the provisions of Section 11.5 hereof without the consent of
all Lenders;

 

(vi) release all or
substantially all of the Collateral without the consent of all
Lenders;

 

(vii) change the rights
and duties of Agent without the consent of all
Lenders;

 

(viii) subject to Section
16.2(d) below, permit any Revolving Advance to be made if after
giving effect thereto the total of Revolving Advances outstanding
hereunder would exceed the Formula Amount for more than sixty (60)
consecutive Business Days or exceed one hundred and ten percent
(110%) of the Formula Amount without the consent of all Revolving
Lenders;

 

(ix) increase the
Advance Rates above the Advance Rates in effect on the Closing Date
without the consent of all Revolving Lenders; or

 

(x) release any Loan
Party (other than in accordance with the provisions of this
Agreement) without the consent of all Lenders.

 

Any
such supplemental agreement shall apply equally to each Lender and
shall be binding upon the Loan Parties, Lenders and Agent and all
future holders of the Obligations. In the case of any waiver, the
Loan Parties, Agent and Lenders shall be restored to their former
positions and rights, and any Event of Default waived shall be
deemed to be cured and not continuing, but no waiver of a specific
Event of Default shall extend to any subsequent Event of Default
(whether or not the subsequent Event of Default is the same as the
Event of Default which was waived), or impair any right consequent
thereon.

 

 

 

-93-

 

 

(c) In the event that
Agent requests the consent of a Lender pursuant to this Section
16.2 and such consent is denied, then Agent may, at its option,
require such Lender to assign its interest in the Advances to Agent
or to another Lender or to any other Person designated by Agent
(the “Designated
Lender”), for a price equal to (i) then outstanding
principal amount thereof plus (ii) accrued and unpaid interest and
fees due such Lender, which interest and fees shall be paid when
collected from the Loan Parties. In the event Agent elects to
require any Lender to assign its interest to Agent or to the
Designated Lender, Agent will so notify such Lender in writing
within forty five (45) days following such Lender’s denial,
and such Lender will assign its interest to Agent or the Designated
Lender no later than five (5) days following receipt of such notice
pursuant to a Commitment Transfer Supplement executed by such
Lender, Agent or the Designated Lender, as appropriate, and
Agent.

 

(d) Notwithstanding (i)
the existence of a Default or an Event of Default, (ii) that
any of the other applicable conditions precedent set forth in
Section 8.2 hereof have not been satisfied or the Revolving
Commitments have been terminated for any reason, or (iii) any other
contrary provision of this Agreement, Agent may at its discretion
and without the consent of any Lender, voluntarily permit the
outstanding Revolving Advances at any time to exceed the Formula
Amount by up to ten percent (10%) of the Formula Amount for up to
sixty (60) consecutive Business Days (the “Out-of-Formula Loans”).
If Agent is willing in its sole and absolute discretion to permit
such Out-of-Formula Loans, Revolving Lenders shall be obligated to
fund such Out-of-Formula Loans in accordance with their respective
Revolving Commitment Percentages, and such Out-of-Formula Loans
shall be payable on demand and shall bear interest at the Contract
Rate for Revolving Advances consisting of Domestic Rate Loans or
(at option of Agent) bear interest at the Default Rate for
Revolving Advances consisting of Domestic Rate Loans; provided
that, if Agent does permit Out-of-Formula Loans, neither Agent nor
Lenders shall be deemed thereby to have changed the limits of
Section 2.1(a) hereof nor shall any Lender be obligated to fund
Revolving Advances in excess of its Revolving Commitment Amount.
For purposes of this Section, the discretion granted to Agent
hereunder shall not preclude involuntary overadvances that may
result from time to time due to the fact that the Formula Amount
was unintentionally exceeded for any reason, including, but not
limited to, Collateral previously deemed to be Eligible
Receivables, Eligible Insured Foreign Receivables or Eligible
Unbilled Receivables, as applicable, becomes ineligible,
collections of Receivables applied to reduce outstanding Revolving
Advances are thereafter returned for insufficient funds or
overadvances are made to protect or preserve the Collateral. In the
event Agent involuntarily permits the outstanding Revolving
Advances to exceed the Formula Amount by more than ten percent
(10%), Agent shall use its efforts to have the Borrowers decrease
such excess in as expeditious a manner as is practicable under the
circumstances and not inconsistent with the reason for such excess.
Revolving Advances made after Agent has determined the existence of
involuntary overadvances shall be deemed to be involuntary
overadvances and shall be decreased in accordance with the
preceding sentence. To the extent any Out-of-Formula Loans are not
actually funded by the other Lenders as provided for in this
Section 16.2(d), Agent may elect in its discretion to fund such
Out-of-Formula Loans and any such Out-of-Formula Loans so funded by
Agent shall be deemed to be Revolving Advances made by and owing to
Agent, and Agent shall be entitled to all rights (including accrual
of interest) and remedies of a Revolving Lender with respect to
such Revolving Advances.

 

(e) In addition to (and
not in substitution of) the discretionary Revolving Advances
permitted in Section 16.2(d) above, Agent is hereby authorized by
the Loan Parties and Lenders, at any time in Agent’s sole
discretion, regardless of (i) the existence of a Default or an
Event of Default, (ii) whether any of the other applicable
conditions precedent set forth in Section 8.2 hereof have not
been satisfied or the Revolving Commitments have been terminated
for any reason, or (iii) any other contrary provision of this
Agreement, to make Revolving Advances to Borrowers on behalf of
Lenders which 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 Advances and other
Obligations, or (C) to pay any other amount chargeable to the Loan
Parties pursuant to the terms of this Agreement
(“Protective
Advances”). Revolving Lenders shall be obligated to
fund such Protective Advances and effect a settlement with Agent
therefor upon demand of Agent in accordance with their respective
Revolving Commitment Percentages. To the extent any Protective
Advances are not actually funded by the other Lenders as provided
for in this Section 16.2(e), any such Protective Advances
funded by Agent shall be deemed to be Revolving Advances made by
and owing to Agent, and Agent shall be entitled to all rights
(including accrual of interest) and remedies of a Revolving Lender
with respect to such Revolving Advances.

 

 

 

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16.3. Successors
and Assigns; Participations; New Lenders.

 

(a) This Agreement
shall be binding upon and inure to the benefit of the Loan Parties,
Agent, each Lender, all future holders of the Obligations and their
respective successors and assigns, except that no Loan Party may
assign or transfer any of its rights or obligations under this
Agreement without the prior written consent of Agent and each
Lender.

 

(b) Each Loan Party
acknowledges that in the regular course of commercial banking
business one or more Lenders may at any time and from time to time
sell participating interests in the Advances to other Persons (each
such transferee or purchaser of a participating interest, a
“Participant”). Each Participant may exercise all
rights of payment (including rights of set-off) with respect to the
portion of such Advances held by it or other Obligations payable
hereunder as fully as if such Participant were the direct holder
thereof provided that (i) the Loan Parties shall not be
required to pay to any Participant more than the amount which it
would have been required to pay to any Lender which granted an
interest in its Advances or other Obligations payable hereunder to
such Participant had such Lender retained such interest in the
Advances hereunder or other Obligations payable hereunder unless
the sale of the participation to such Participant is made with Loan
Party’s prior written consent, and (ii) in no event shall the
Loan Parties be required to pay any such amount arising from the
same circumstances and with respect to the same Advances or other
Obligations payable hereunder to both such Lender and such
Participant. Any agreement or instrument pursuant to which a Lender
sells such a participation shall provide that such Lender shall
retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this
Agreement; provided that such agreement or instrument may provide
that such Lender will not, without the consent of the Participant,
agree to any amendment, modification or waiver described in Section
16.2(b)(i) through (x) hereof that affects such Participant. Each
Participant (A) shall provide the documentation required under
Section 3.10(g) hereof to the participating Lender to the same
extent as if it were a Lender and had acquired its interest by
assignment pursuant to Section 16.3(c) hereof and (B) shall be
subject to the provisions of Section 3.12 hereof as if it were an
assignee under Section 16.3(c) hereof. Each Lender that sells a
participation agrees, at the Borrower's request and expense, to use
reasonable efforts to cooperate with the Borrower to effectuate the
provisions of Section 3.11 hereof with respect to any Participant.
To the extent permitted by law, each Participant also shall be
entitled to the benefits of Section 11.03 hereof as though it were
a Lender; provided that such Participant agrees to be subject to
Section 2.6(b) hereof as though it were a Lender. Each Lender that
sells a participation shall, acting solely for this purpose as a
non-fiduciary agent of Borrower, maintain a register on which it
enters the name and address of each Participant and the principal
amounts (and stated interest) of each Participant’s interest
in the Advances or other obligations under the Other Documents (the
“Participant Register”); provided that no Lender shall
have any obligation to disclose all or any portion of the
Participant Register (including the identity of any Participant or
any information relating to a Participant's interest in any
commitments, advances, loans, letters of credit or its other
obligations under any Other Document) to any Person except to the
extent that such disclosure is necessary to establish that such
commitment, loan, letter of credit or other obligation is in
registered form under Section 5f.103-1(c) of the United States
Treasury Regulations. The entries in the Participant Register shall
be conclusive absent manifest error, and such Lender shall treat
each Person whose name is recorded in the Participant Register as
the owner of such participation for all purposes of this Agreement
notwithstanding any notice to the contrary. For the avoidance of
doubt, Agent (in its capacity as Agent) shall have no
responsibility for maintaining a Participant Register.

 

 

 

-95-

 

 

(c) Any Lender, with
the consent of Agent, may sell, assign or transfer all or any part
of its rights and obligations under or relating to Revolving
Advances under this Agreement and the Other Documents to one or
more additional Persons and one or more additional Persons may
commit to make Advances hereunder (each a “Purchasing
Lender”), in minimum amounts of not less than $5,000,000,
pursuant to a Commitment Transfer Supplement, executed by a
Purchasing Lender, the transferor Lender, and Agent and delivered
to Agent for recording, provided, however, that (i) each partial
assignment shall be made as an assignment of a proportionate part
of all the assigning Lender's rights and obligations under this
Agreement with respect to each of the Revolving Advances under this
Agreement in which such Lender has an interest and (ii) that the
consent of Borrowing Agent (such consent not to be unreasonably
withheld, conditioned or delayed) shall be required unless (x) an
Event of Default has occurred and is continuing at the time of such
assignment or (y) such assignment is to a Permitted Assignee;
provided that Borrowing Agent shall be deemed to have consented to
any such assignment unless it shall object thereto by written
notice to Agent within 10 Business Days after having received prior
notice thereof. Upon such execution, delivery, acceptance and
recording, from and after the transfer effective date determined
pursuant to such Commitment Transfer Supplement, (i) Purchasing
Lender thereunder shall be a party hereto and, to the extent
provided in such Commitment Transfer Supplement, have the rights
and obligations of a Lender thereunder with a Revolving Commitment
Percentage as set forth therein, and (ii) the transferor Lender
thereunder shall, to the extent provided in such Commitment
Transfer Supplement, be released from its obligations under this
Agreement, the Commitment Transfer Supplement creating a novation
for that purpose. Such Commitment Transfer Supplement shall be
deemed to amend this Agreement to the extent, and only to the
extent, necessary to reflect the addition of such Purchasing Lender
and the resulting adjustment of the Revolving Commitment
Percentages arising from the purchase by such Purchasing Lender of
all or a portion of the rights and obligations of such transferor
Lender under this Agreement and the Other Documents. Each Loan
Party hereby consents to the addition of such Purchasing Lender and
the resulting adjustment of the Revolving Commitment Percentages
arising from the purchase by such Purchasing Lender of all or a
portion of the rights and obligations of such transferor Lender
under this Agreement and the Other Documents. The Loan Parties
shall execute and deliver such further documents and do such
further acts and things in order to effectuate the
foregoing.

 

(d) Any Lender, with
the consent of Agent, which consent shall not be unreasonably
withheld or delayed, may directly or indirectly sell, assign or
transfer all or any portion of its rights and obligations under or
relating to Revolving Advances under this Agreement and the Other
Documents to an entity, whether a corporation, partnership, trust,
limited liability company or other entity that (i) is engaged in
making, purchasing, holding or otherwise investing in bank loans
and similar extensions of credit in the ordinary course of its
business and (ii) is administered, serviced or managed by the
assigning Lender or an Affiliate of such Lender (a
“Purchasing CLO” and together with each Participant and
Purchasing Lender, each a “Transferee” and collectively
the “Transferees”), pursuant to a Commitment Transfer
Supplement modified as appropriate to reflect the interest being
assigned (“Modified Commitment Transfer Supplement”),
executed by any intermediate purchaser, the Purchasing CLO, the
transferor Lender, and Agent as appropriate and delivered to Agent
for recording. Upon such execution and delivery, from and after the
transfer effective date determined pursuant to such Modified
Commitment Transfer Supplement, (i) Purchasing CLO thereunder shall
be a party hereto and, to the extent provided in such Modified
Commitment Transfer Supplement, have the rights and obligations of
a Lender thereunder and (ii) the transferor Lender thereunder
shall, to the extent provided in such Modified Commitment Transfer
Supplement, be released from its obligations under this Agreement,
the Modified Commitment Transfer Supplement creating a novation for
that purpose. Such Modified Commitment Transfer Supplement shall be
deemed to amend this Agreement to the extent, and only to the
extent, necessary to reflect the addition of such Purchasing CLO.
Each Loan Party hereby consents to the addition of such Purchasing
CLO. The Loan Parties shall execute and deliver such further
documents and do such further acts and things in order to
effectuate the foregoing.

 

 

 

-96-

 

 

(e) Agent, acting as a
non-fiduciary agent of the Loan Parties, shall maintain at its
address a copy of each Commitment Transfer Supplement and Modified
Commitment Transfer Supplement delivered to it and a register (the
“Register”) for the recordation of the names and
addresses of each Lender and the outstanding principal, accrued and
unpaid interest and other fees due hereunder. The entries in the
Register shall be conclusive, in the absence of manifest error, and
each Loan Party, Agent and Lenders may treat each Person whose name
is recorded in the Register as the owner of the Advance recorded
therein for the purposes of this Agreement. The Register shall be
available for inspection by Borrowing Agent or any Lender at any
reasonable time and from time to time upon reasonable prior notice.
Agent shall receive a fee in the amount of $3,500 payable by the
applicable Purchasing Lender and/or Purchasing CLO upon the
effective date of each transfer or assignment (other than to an
intermediate purchaser) to such Purchasing Lender and/or Purchasing
CLO.

 

(f) Subject to Section
16.15 hereof, each Loan Party authorizes each Lender to disclose to
any Transferee and any prospective Transferee any and all financial
information in such Lender’s possession concerning such Loan
Party which has been delivered to such Lender by or on behalf of
such Loan Party pursuant to this Agreement or in connection with
such Lender’s credit evaluation of such Loan
Party.

 

(g) Notwithstanding
anything to the contrary set forth in this Agreement, any Lender
may at any time and from time to time pledge or assign a security
interest in all or any portion of its rights under this Agreement
to secure obligations of such Lender, including any pledge or
assignment to secure obligations to a Federal Reserve Bank;
provided that no
such pledge or assignment shall release such Lender from any of its
obligations hereunder or substitute any such pledgee or assignee
for such Lender as a party hereto.

 

16.4. Application of
Payments. After the
occurrence and during an Event of Default, Agent shall have the
continuing and exclusive right to apply or reverse and re-apply any
payment and any and all proceeds of Collateral to any portion of
the Obligations. To the extent that any Loan Party makes a payment
or Agent or any Lender receives any payment or proceeds of the
Collateral for any Loan Party’s benefit, which are
subsequently invalidated, declared to be fraudulent or
preferential, set aside or required to be repaid to a trustee,
debtor in possession, receiver, custodian or any other party under
any bankruptcy law, common law or equitable cause, then, to such
extent, the Obligations or part thereof intended to be satisfied
shall be revived and continue as if such payment or proceeds had
not been received by Agent or such Lender.

 

 

 

-97-

 

 

16.5. Indemnity.
Each Loan Party shall defend, protect, indemnify, pay and save
harmless Agent, Issuer, each Lender and each of their respective
officers, directors, Affiliates, attorneys, employees and agents
(each an “Indemnified Party”) for
and from and against any and all claims, demands, liabilities,
obligations, losses, damages, penalties, fines, actions, judgments,
suits, costs, charges, expenses and disbursements of any kind or
nature whatsoever (including fees and disbursements of counsel
(including allocated costs of internal counsel)) (collectively,
“Claims”) which may be imposed on, incurred by, or
asserted against any Indemnified Party arising out of or in any way
relating to or as a consequence, direct or indirect, of: (a) this
Agreement, the Other Documents, the Advances and other Obligations
and/or the transactions contemplated hereby including the
Transactions, (b) any action or failure to act or action taken only
after delay or the satisfaction of any conditions by any
Indemnified Party in connection with and/or relating to the
negotiation, execution, delivery or administration of the Agreement
and the Other Documents, the credit facilities established
hereunder and thereunder and/or the transactions contemplated
hereby including the Transactions, (c) any Loan Party’s
failure to observe, perform or discharge any of its covenants,
obligations, agreements or duties under or breach of any of the
representations or warranties made in this Agreement and the Other
Documents, (d) the enforcement of any of the rights and remedies of
Agent, Issuer or any Lender under the Agreement and the Other
Documents, (e) any threatened or actual imposition of fines or
penalties, or disgorgement of benefits, for violation of any
Anti-Terrorism Law by any Loan Party, any Affiliate or Subsidiary
of any of the Loan Parties, and (f) any claim, litigation,
proceeding or investigation instituted or conducted by any
Governmental Body or instrumentality, any Loan Party, any Affiliate
or Subsidiary of any Loan Party, or any other Person with respect
to any aspect of, or any transaction contemplated by, or referred
to in, or any matter related to, this Agreement or the Other
Documents, whether or not Agent or any Lender is a party thereto.
Without limiting the generality of any of the foregoing, each Loan
Party shall defend, protect, indemnify, pay and save harmless each
Indemnified Party from (x) any Claims which may be imposed on,
incurred by, or asserted against any Indemnified Party arising out
of or in any way relating to or as a consequence, direct or
indirect, of the issuance of any Letter of Credit hereunder, and
(y) any Claims which may be imposed on, incurred by, or asserted
against any Indemnified Party under any Environmental Laws with
respect to or in connection with any Real Property owned or leased
by any Loan Party, any Hazardous Discharge, the presence of any
Hazardous Materials affecting any Real Property owned or leased by
any Loan Party (whether or not the same originates or emerges from
such Real Property or any contiguous real estate), including any
Claims consisting of or relating to the imposition or assertion of
any Lien on any Real Property owned or leased by any Loan Party
under any Environmental Laws and any loss of value of such Real
Property as a result of the foregoing except to the extent such
loss, liability, damage and expense is attributable to any
Hazardous Discharge resulting from actions on the part of Agent or
any Lender. The Loan Parties’ obligations under this Section
16.5 shall arise upon the discovery of the presence of any
Hazardous Materials at any Real Property owned or leased by any
Loan Party, whether or not any federal, state, or local
environmental agency has taken or threatened any action in
connection with the presence of any Hazardous Materials, in each
such case except to the extent that any of the foregoing arises out
of the gross negligence or willful misconduct of the Indemnified
Party (as determined by a court of competent jurisdiction in a
final and non-appealable judgment or order). Without limiting the
generality of the foregoing, this indemnity shall extend to any
liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses and disbursements of any kind or
nature whatsoever (including fees and disbursements of counsel)
asserted against or incurred by any of the Indemnified Parties by
any Person under any Environmental Laws or similar laws by reason
of any Loan Party’s or any other Person’s failure to
comply with laws applicable to solid or hazardous waste materials,
including Hazardous Materials and Hazardous Waste, or other Toxic
Substances. Notwithstanding anything in this Section 16.5 to the
contrary, the indemnity provided by this Section 16.5 shall not, as
to any Indemnified Party, be available to the extent that such
losses, claims, damages, liabilities or related expenses (x) are
determined by a court of competent jurisdiction by final and
nonappealable judgment to have resulted from the gross negligence
or willful misconduct of such Indemnified Party, (y) result from a
claim brought by a Loan Party against an Indemnified Party for
breach in bad faith of such Indemnified Party’s obligations
hereunder or under any other Other Document, if such Loan Party has
obtained a final and nonappealable judgment in its favor on such
claim as determined by a court of competent jurisdiction or (z)
result from a claim not involving an act or omission of a Loan
Party and that is brought by an Indemnified Party against another
Indemnified Party (other than against Agent in its capacities as
such). This Section 16.5 shall not apply with respect to Taxes
other than Taxes that represent losses, claims, damages, etc.
arising from any non-Tax claim.

 

 

 

-98-

 

 

16.6. Notice.
Any notice or request hereunder may be given to Borrowing Agent or
any Loan Party or to Agent or any Lender at their respective
addresses set forth below or at such other address as may hereafter
be specified in a notice designated as a notice of change of
address under this Section. Any notice, request, demand, direction
or other communication (for purposes of this Section 16.6 only, a
“Notice”) to be given to or made upon any party hereto
under any provision of this Agreement shall be given or made by
telephone or in writing (which includes by means of electronic
transmission (i.e., “e-mail”) or facsimile transmission
or by setting forth such Notice on a website to which the Loan
Parties are directed (an “Internet Posting”) if Notice
of such Internet Posting (including the information necessary to
access such site) has previously been delivered to the applicable
parties hereto by another means set forth in this Section 16.6) in
accordance with this Section 16.6. Any such Notice must be
delivered to the applicable parties hereto at the addresses and
numbers set forth under their respective names set forth below in
this Section 16.6 or in accordance with any subsequent unrevoked
Notice from any such party that is given in accordance with this
Section 16.6. Any Notice shall be effective:

 

(a) In the case of
hand-delivery, when delivered;

 

(b) If given by mail,
four (4) days after such Notice is deposited with the United States
Postal Service, with first-class postage prepaid, return receipt
requested;

 

(c) In the case of a
telephonic Notice, when a party is contacted by telephone, if
delivery of such telephonic Notice is confirmed no later than the
next Business Day by hand delivery, a facsimile or electronic
transmission, an Internet Posting or an overnight courier delivery
of a confirmatory Notice (received at or before noon on such next
Business Day);

 

(d) In the case of a
facsimile transmission, when sent to the applicable party’s
facsimile machine’s telephone number, if the party sending
such Notice receives confirmation of the delivery thereof from its
own facsimile machine;

 

(e) In the case of
electronic transmission, when actually received;

 

(f) In the case of an
Internet Posting, upon delivery of a Notice of such posting
(including the information necessary to access such site) by
another means set forth in this Section 16.6; and

 

(g) If given by any
other means (including by overnight courier), when actually
received.

 

Any
Lender giving a Notice to Borrowing Agent or any Loan Party shall
concurrently send a copy thereof to Agent, and Agent shall promptly
notify the other Lenders of its receipt of such
Notice.

 

(A)           If
to Agent or PNC at:

 

PNC
Bank, National Association

One
Piedmont Town Center

4720
Piedmont Row Drive, Suite 300

Charlotte,
NC  28210

Attention: Scott
K. Goldstein

Telephone: (704)
551-8511

Facsimile: (704)
643-7918

Email:
scott.goldstein@pnc.com

 

with a
copy to:

 

Blank
Rome LLP

One
Logan Square

Philadelphia, PA
19103

Attention: Michael
C. Graziano

Telephone: (215)
569-5387

Facsimile: (215)
885-5387

 

(B)           If
to Borrowing Agent or any Loan Party:

 

AutoWeb,
Inc.

18872
MacArthur Blvd., Suite 200

Irvine,
CA 92612

Attention:
CFO

Telephone: (949)
757-8907

 

 

 

-99-

 

 

16.7. Survival.
The obligations of the Loan Parties under Sections 2.2(g), 3.7,
3.9, 3.10, 16.5 and 16.9 hereof and the obligations of Lenders
under Sections 2.2, 2.15(b), 2.16, 2.18, 2.19 and 14.8 hereof,
shall survive the termination of this Agreement and the Other
Documents and the Payment in Full of the Obligations.

 

16.8. Severability.
If any part of this Agreement is contrary to, prohibited by, or
deemed invalid under Applicable Laws, such provision shall be
inapplicable and deemed omitted to the extent so contrary,
prohibited or invalid, but the remainder hereof shall not be
invalidated thereby and shall be given effect so far as
possible.

 

16.9. Expenses. The Loan Parties
shall pay (a) all reasonable out-of-pocket expenses incurred
by Agent and its Affiliates (including the reasonable fees, charges
and disbursements of counsel for Agent), and shall pay all fees and
time charges and disbursements for attorneys who may be employees
of Agent, in connection with the syndication of the credit
facilities provided for herein, the preparation, negotiation,
execution, delivery and administration of this Agreement and the
Other Documents or any amendments, modifications or waivers of the
provisions hereof or thereof (whether or not the transactions
contemplated hereby or thereby shall be consummated), (b) all
reasonable out-of-pocket expenses incurred by Issuer in connection
with the issuance, amendment, renewal or extension of any Letter of
Credit or any demand for payment thereunder, (c) all
out-of-pocket expenses incurred by Agent, any Lender or Issuer
(including the fees, charges and disbursements of any counsel for
Agent, any Lender or Issuer) in connection with the enforcement of
its rights (i) in connection with this Agreement and the Other
Documents, including its rights under this Section, or (ii) in
connection with the Advances made or Letters of Credit issued
hereunder, including all such out-of-pocket expenses incurred
during any workout, restructuring or negotiations in respect of
such Advances or Letters of Credit, and (d) all reasonable
out-of-pocket expenses of Agent’s regular employees and
agents engaged periodically to perform audits of any Loan
Party’s or any Loan Party’s Affiliate’s or
Subsidiary’s books, records and business
properties.

 

16.10. Injunctive
Relief. Each Loan Party
recognizes that, in the event any Loan Party fails to perform,
observe or discharge any of its obligations or liabilities under
this Agreement, or threatens to fail to perform, observe or
discharge such obligations or liabilities, any remedy at law may
prove to be inadequate relief to Lenders; therefore, Agent, if
Agent so requests, shall be entitled to temporary and permanent
injunctive relief in any such case without the necessity of proving
that actual damages are not an adequate remedy.

 

16.11. Consequential
Damages. Neither Agent nor
any Lender, nor any agent or attorney for any of them, shall be
liable to any Loan Party (or any Affiliate of any such Person) for
indirect, punitive, exemplary or consequential damages arising from
any breach of contract, tort or other wrong relating to the
establishment, administration or collection of the Obligations or
as a result of any transaction contemplated under this Agreement or
any Other Document.

 

16.12. Captions. The captions at
various places in this Agreement are intended for convenience only
and do not constitute and shall not be interpreted as part of this
Agreement.

 

16.13. Counterparts; Facsimile
Signatures. This Agreement
may be executed in any number of and by different parties hereto on
separate counterparts, all of which, when so executed, shall be
deemed an original, but all such counterparts shall constitute one
and the same agreement. Any signature delivered by a party by
facsimile or electronic transmission (including email transmission
of a PDF image) shall be deemed to be an original signature
hereto.

 

16.14. Construction.
The parties acknowledge that each party and its counsel have
reviewed this Agreement and that the normal rule of construction to
the effect that any ambiguities are to be resolved against the
drafting party shall not be employed in the interpretation of this
Agreement or any amendments, schedules or exhibits
thereto.

 

 

 

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16.15. Confidentiality;
Sharing Information. Agent, each
Lender and each Transferee shall hold all non-public information
obtained by Agent, such Lender or such Transferee pursuant to the
requirements of this Agreement in accordance with Agent’s,
such Lender’s and such Transferee’s customary
procedures for handling confidential information of this nature;
provided, however, Agent, each Lender and each Transferee may
disclose such confidential information (a) to its examiners,
Affiliates, directors, officers, partners, employees, agents,
outside auditors, counsel and other professional advisors (it being
understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and
instructed to keep such information confidential), (b) to Agent,
any Lender or to any prospective Transferees or Participants
(subject, in the case of Transferees or Participants, to an
agreement containing provisions substantially the same as those of
this Section), and (c) as required or requested by any Governmental
Body or representative thereof or pursuant to legal process;
provided, further that (i) unless specifically prohibited by
Applicable Law, Agent, each Lender and each Transferee shall use
its reasonable best efforts prior to disclosure thereof, to notify
the applicable Loan Party of the applicable request for disclosure
of such non-public information (A) by a Governmental Body or
representative thereof (other than any such request in connection
with an examination of the financial condition of a Lender or a
Transferee by such Governmental Body) or (B) pursuant to legal
process and (ii) in no event shall Agent, any Lender or any
Transferee be obligated to return any materials provided by any
Loan Party other than those documents and instruments in possession
of Agent or any Lender in order to perfect its Lien on the
Collateral once the Obligations have been Paid in Full, the
Commitments have been terminated and this Agreement has been
terminated. Each Loan Party acknowledges that from time to time
financial advisory, investment banking and other services may be
offered or provided to such Loan Party or one or more of its
Affiliates (in connection with this Agreement or otherwise) by any
Lender or by one or more Subsidiaries or Affiliates of such Lender
and each Loan Party hereby authorizes each Lender to share any
information delivered to such Lender by such Loan Party and its
Subsidiaries pursuant to this Agreement, or in connection with the
decision of such Lender to enter into this Agreement, to any such
Subsidiary or Affiliate of such Lender, it being understood that
any such Subsidiary or Affiliate of any Lender receiving such
information shall be bound by the provisions of this Section 16.15
as if it were a Lender hereunder. Such authorization shall survive
the repayment of the other Obligations and the termination of this
Agreement. Notwithstanding any non-disclosure agreement or similar
document executed by Agent in favor of any Loan Party or any of any
Loan Party’s affiliates, the provisions of this Agreement
shall supersede such agreements.

 

16.16. Publicity. Each Loan Party
and each Lender hereby authorizes Agent to make appropriate
announcements of the financial arrangement entered into among the
Loan Parties, Agent and Lenders, including announcements which are
commonly known as tombstones, in such publications and to such
selected parties as Agent shall in its sole and absolute discretion
deem appropriate.

 

16.17. Certifications From Banks and
Participants; USA PATRIOT Act.

 

(a) Each Lender or
assignee or participant of a Lender that is not incorporated under
the Laws of the United States of America or a state thereof (and is
not excepted from the certification requirement in Section 313 of
the USA PATRIOT Act and the applicable regulations because it is
both (i) an affiliate of a depository institution or foreign bank
that maintains a physical presence in the United States or foreign
country, and (ii) subject to supervision by a banking authority
regulating such affiliated depository institution or foreign bank)
shall deliver to Agent the certification, or, if applicable,
recertification, certifying that such Lender is not a
“shell” and certifying to other matters as required by
Section 313 of the USA PATRIOT Act and the applicable regulations:
(1) within ten (10) days after the Closing Date, and (2) as such
other times as are required under the USA PATRIOT Act.

 

(b) The USA PATRIOT
Act requires all financial institutions to obtain, verify and
record certain information that identifies individuals or business
entities which open an “account” with such financial
institution. Consequently, any Lender may from time to time
request, and each Loan Party shall provide to such Lender, such
Loan Party's name, address, tax identification number and/or such
other identifying information as shall be necessary for such Lender
to comply with the USA PATRIOT Act and any other Anti-Terrorism
Law.

 

 

 

-101-

 

 

16.18. Anti-Terrorism
Laws.

 

(a) Each Loan Party
represents and warrants that (i) no Covered Entity is a Sanctioned
Person and (ii) no Covered Entity, either in its own right or
through any third party, (A) has any of its assets in a Sanctioned
Country or in the possession, custody or control of a Sanctioned
Person in violation of any Anti-Terrorism Law; (B) does business in
or with, or derives any of its income from investments in or
transactions with, any Sanctioned Country or Sanctioned Person in
violation of any Anti-Terrorism Law; or (C) engages in any dealings
or transactions prohibited by any Anti-Terrorism Law.

 

(b) Each Loan Party
covenants and agrees that (i) no Covered Entity will become a
Sanctioned Person, (ii) no Covered Entity, either in its own right
or through any third party, will (A) have any of its assets in a
Sanctioned Country or in the possession, custody or control of a
Sanctioned Person in violation of any Anti-Terrorism Law; (B) do
business in or with, or derive any of its income from investments
in or transactions with, any Sanctioned Country or Sanctioned
Person in violation of any Anti-Terrorism Law; (C) engage in any
dealings or transactions prohibited by any Anti-Terrorism Law or
(D) use the Advances to fund any operations in, finance any
investments or activities in, or, make any payments to, a
Sanctioned Country or Sanctioned Person in violation of any
Anti-Terrorism Law, (iii) the funds used to repay the Obligations
will not be derived from any unlawful activity, (iv) each Covered
Entity shall comply with all Anti-Terrorism Laws and (v) the Loan
Parties shall promptly notify Agent in writing upon the occurrence
of a Reportable Compliance Event.

 

16.19. Acknowledgment and Consent to Bail-In
of EEA Financial Institutions. Notwithstanding anything to
the contrary contained in this Agreement, any Other Document, or
any other agreement, arrangement or understanding among Agent,
Lenders and the Loan Parties, Agent, each Lender and each Loan
Party acknowledges that any liability of any EEA Financial
Institution arising under this Agreement or any Other Document, to
the extent such liability is unsecured, may be subject to the
Write-Down and Conversion Powers of an EEA Resolution Authority and
agrees and consents to, and acknowledges and agrees to be bound
by:

 

(a) the application of
any Write-Down and Conversion Powers by an EEA Resolution Authority
to any such liabilities arising hereunder which may be payable to
it by any party hereto that is an EEA Financial Institution;
and

 

(b) the effects of any
Bail-In Action on any such liability, including, if
applicable:

 

(i) a reduction in
full or in part or cancellation of any such liability;

 

(ii) a conversion of
all, or a portion of, such liability into shares or other
instruments of ownership in such EEA Financial Institution, its
parent undertaking, or a bridge institution that may be issued to
it or otherwise conferred on it, and that such shares or other
instruments of ownership will be accepted by it in lieu of any
rights with respect to any such liability under this Agreement or
any Other Document; or

 

(iii) the variation of
the terms of such liability in connection with the exercise of the
Write-Down and Conversion Powers of any EEA
Resolution.

 

XVII. 
GUARANTY.

 

17.1. Guaranty. Each Guarantor
hereby unconditionally guarantees, as a primary obligor and not
merely as a surety, jointly and severally with each other Guarantor
when and as due, whether at maturity, by acceleration, by notice of
prepayment or otherwise, the due and punctual performance of all
Obligations; provided that with respect to Obligations under or in
respect of any Swap Obligation, the foregoing guarantee shall only
be effective to the extent that such Guarantor is a Qualified ECP
Loan Party at the time such Swap Obligation is entered into and
such Obligations and such guarantee thereof are not Excluded Hedge
Liabilities. Each payment made by any Guarantor pursuant to this
Guaranty shall be made in lawful money of the United States in
immediately available funds.

 

 

 

-102-

 

 

17.2. Waivers.
Each Guarantor hereby absolutely, unconditionally and irrevocably
waives (a) promptness, diligence, notice of acceptance, notice of
presentment of payment and any other notice hereunder, (b) demand
of payment, protest, notice of dishonor or nonpayment, notice of
the present and future amount of the Obligations and any other
notice with respect to the Obligations, (c) any requirement that
Agent, any Lender protect, secure, perfect or insure any security
interest or Lien on any property subject thereto or exhaust any
right or take any action against any other Loan Party, or any
Person or any Collateral, (d) any other action, event or
precondition to the enforcement hereof or the performance by each
such Guarantor of the Obligations, and (e) any defense arising by
any lack of capacity or authority or any other defense of any Loan
Party or any notice, demand or defense by reason of cessation from
any cause of Obligations other than the Payment in Full of the
Obligations and any defense that any other guarantee or security
was or was to be obtained by Agent.

 

17.3. No Defense. No invalidity,
irregularity, voidableness, voidness or unenforceability of this
Agreement or any Other Document or any other agreement or
instrument relating thereto, or of all or any part of the
Obligations or of any collateral security therefor shall affect,
impair or be a defense hereunder.

 

17.4. Guaranty of
Payment. The Guaranty
hereunder is one of payment and performance, not collection, and
the obligations of each Guarantor hereunder are independent of the
Obligations of the other Loan Parties, and a separate action or
actions may be brought and prosecuted against any Guarantor to
enforce the terms and conditions of this Article XVII, irrespective
of whether any action is brought against any other Loan Party or
other Persons or whether any other Loan Party or other Persons are
joined in any such action or actions. Each Guarantor waives any
right to require that any resort be had by Agent or any Lender to
any security held for payment of the Obligations or to any balance
of any deposit account or credit on the books of Agent or any
Lender in favor of any Loan Party or any other Person. No election
to proceed in one form of action or proceedings, or against any
Person, or on any Obligations, shall constitute a waiver of
Agent’s right to proceed in any other form of action or
proceeding or against any other Person unless Agent has expressed
any such right in writing. Without limiting the generality of the
foregoing, no action or proceeding by Agent against any Loan Party
under any document evidencing or securing indebtedness of any Loan
Party to Agent shall diminish the liability of any Guarantor
hereunder, except to the extent Agent receives actual payment on
account of Obligations by such action or proceeding,
notwithstanding the effect of any such election, action or
proceeding upon the right of subrogation of any Guarantor in
respect of any Loan Party.

 

17.5. Liabilities
Absolute. The liability of
each Guarantor hereunder shall be absolute, unlimited and
unconditional and shall not be subject to any reduction,
limitation, impairment, discharge or termination for any reason,
including, without limitation, any claim of waiver, release,
surrender, alteration or compromise, and shall not be subject to
any claim, defense or setoff, counterclaim, recoupment or
termination whatsoever by reason of the invalidity, illegality or
unenforceability of any other Obligation or otherwise (other than
Payment in Full of the Obligations). Without limiting the
generality of the foregoing, the obligations of each Guarantor
shall not be discharged or impaired, released, limited or otherwise
affected by:

 

(a) any change in the
manner, place or terms of payment or performance, and/or any change
or extension of the time of payment or performance of, release,
renewal or alteration of, or any new agreements relating to any
Obligation, any security therefor, or any liability incurred
directly or indirectly in respect thereof, or any rescission of, or
amendment, waiver or other modification of, or any consent to
departure from, this Agreement or any Other Document, including any
increase in the Obligations resulting from the extension of
additional credit to any Loan Party or otherwise;

 

(b) any sale,
exchange, release, surrender, loss, abandonment, realization upon
any property by whomsoever at any time pledged or mortgaged to
secure, or howsoever securing, all or any of the Obligations,
and/or any offset there against, or failure to perfect, or continue
the perfection of, any Lien in any such property, or delay in the
perfection of any such Lien, or any amendment or waiver of or
consent to departure from any other guaranty for all or any of the
Obligations;

 

 

 

-103-

 

 

(c) the failure of
Agent or any Lender to assert any claim or demand or to enforce any
right or remedy against any Loan Party or any other Loan Party or
any other Person under the provisions of this Agreement or any
Other Document or any other document or instrument executed and
delivered in connection herewith or therewith;

 

(d) any settlement or
compromise of any Obligation, any security therefor or any
liability (including any of those hereunder) incurred directly or
indirectly in respect thereof or hereof, and any subordination of
the payment of all or any part thereof to the payment of any
obligation (whether due or not) of any Loan Party to creditors of
any Loan Party other than any other Loan Party;

 

(e) any manner of
application of Collateral, or proceeds thereof, to all or any of
the Obligations, or any manner of sale or other disposition of any
Collateral for all or any of the Obligations or any other assets of
any Loan Party; and

 

(f) any other
agreements or circumstance of any nature whatsoever that may or
might in any manner or to any extent vary the risk of any
Guarantor, or that might otherwise at law or in equity constitute a
defense available to, or a discharge of, the Guaranty hereunder
and/or the obligations of any Guarantor, or a defense to, or
discharge of, any Loan Party or any other Person or party hereto or
the Obligations or otherwise with respect to the Advances or other
financial accommodations to the Loan Parties pursuant to this
Agreement and/or the Other Documents (other than Payment in Full of
the Obligations).

 

17.6. Waiver of
Notice. Agent shall have
the right to do any of the above without notice to or the consent
of any Guarantor and each Guarantor expressly waives any right to
notice of, consent to, knowledge of and participation in any
agreements relating to any of the above or any other present or
future event relating to Obligations whether under this Agreement
or otherwise or any right to challenge or question any of the above
and waives any defenses of such Guarantor which might arise as a
result of such actions.

 

17.7. Agent’s
Discretion. Agent may at any
time and from time to time (whether prior to or after the
revocation or termination of this Agreement) without the consent
of, or notice to, any Guarantor, and without incurring
responsibility to any Guarantor or impairing or releasing the
Obligations, apply any sums by whomsoever paid or howsoever
realized to any Obligations in accordance with the provisions of
this Agreement regardless of what Obligations remain
unpaid.

 

17.8. Reinstatement.

 

(a) The Guaranty
provisions herein set forth herein shall continue to be effective
or be reinstated, as the case may be, if claim is ever made upon
Agent or any Lender for repayment or recovery of any amount or
amounts received by such Agent or such Lender in payment or on
account of any of the Obligations and such Person repays all or
part of said amount for any reason whatsoever, including, without
limitation, by reason of any judgment, decree or order of any court
or administrative body having jurisdiction over such Person or the
respective property of each, or any settlement or compromise of any
claim effected by such Person with any such claimant (including any
Loan Party); and in such event each Guarantor hereby agrees that
any such judgment, decree, order, settlement or compromise or other
circumstances shall be binding upon such Guarantor, notwithstanding
any revocation hereof or the cancellation of any note or other
instrument evidencing any Obligation, and each Guarantor shall be
and remain liable to Agent and/or Lenders for the amount so repaid
or recovered to the same extent as if such amount had never
originally been received by such Persons.

 

(b) Agent shall not be
required to marshal any assets in favor of any Guarantor, or
against or in payment of Obligations.

 

 

 

-104-

 

 

(c) No Guarantor shall
be entitled to claim against any present or future security held by
Agent from any Person for Obligations in priority to or equally
with any claim of Agent, or assert any claim for any liability of
any Loan Party to any Guarantor in priority to or equally with
claims of Agent for Obligations, and no Guarantor shall be entitled
to compete with Agent with respect to, or to advance any equal or
prior claim to any security held by Agent for
Obligations.

 

(d) If any Loan Party
makes any payment to Agent, which payment is wholly or partly
subsequently invalidated, declared to be fraudulent or
preferential, set aside or required to be repaid to any Person
under any federal or provincial statute or at common law or under
equitable principles, then to the extent of such payment, the
Obligation intended to be paid shall be revived and continued in
full force and effect as if the payment had not been made, and the
resulting revived Obligation shall continue to be guaranteed,
uninterrupted, by each Guarantor hereunder.

 

(e) All present and
future monies payable by any Loan Party to any Guarantor, whether
arising out of a right of subrogation or otherwise, are assigned to
Agent for its benefit and for the ratable benefit of Lenders as
security for such Guarantor’s liability to Agent and Lenders
hereunder and are subordinated to Agent’s prior right to
Payment in Full of the Obligations. Except to the extent prohibited
otherwise by this Agreement, after the occurrence and during the
continuation of an Event of Default, all monies received by any
Guarantor from any Loan Party shall be held by such Guarantor as
agent and trustee for Agent. This assignment and subordination
shall only terminate when the Obligations are Paid in Full and this
Agreement is terminated.

 

(f) Each Loan Party
acknowledges this assignment and subordination. Each Loan Party
agrees to give full effect to the provisions hereof.

 

[signature pages follow]

 

 

-105-

 

 

Each of
the parties has signed this Agreement as of the day and year first
above written.

 

	

BORROWERS:

	

AUTOWEB,
INC.

 

By: 
/s/ Joseph P.
Hannan                                                       

Name:
Joseph P. Hannan

Title:
Executive Vice President

 

	
 

	
 

	
 

	
 

	
 

	
 

	

GUARANTORS:

	

CAR.COM,
INC.

 

By:
/s/ Joseph P.
Hannan                                                       

Name:
Joseph P. Hannan

Title:
Executive Vice President

 

	
 

	

AUTOBYTEL,
INC.

 

By:
/s/ Joseph P.
Hannan                                                       

Name:
Joseph P. Hannan

Title:
Executive Vice President

 

AW GUA
USA, INC.

 

By: 
/s/ Joseph P.
Hannan                                                  

Name:
Joseph P. Hannan

Title:
Executive Vice President

 

	
 

	
 

 

-106-

 

	
 

	

PNC
BANK, NATIONAL ASSOCIATION,

as
Agent and Lender

 

By:
/s/ Scott K.
Goldstein 

Name:
Scott K. Goldstein

Title:
Senior Vice President

 

	
 

	
 

 

-107-

 

 

 

Exhibit
1.2(a)

Form of
Borrowing Base Certificate

 

See
attached

 

 

 

-108-

 

      

  

 

 

 

 

 

 

 

 

 

 

 

Exhibit
1.2(b)

Form of
Compliance Certificate

 

COMPLIANCE
CERTIFICATE

 

PNC
Bank, National Association

[____________________]

[____________________]

Attention:
[___________]

 

The
undersigned, the [Chief Financial Officer] of AUTOWEB, INC., a Delaware
(“Borrowing
Agent”), certifies to PNC BANK, NATIONAL ASSOCIATION,
in its capacity as agent (in such capacity, “Agent”), and the Lenders
(as defined below) that, pursuant to the terms and conditions of
that certain Revolving Credit and Security Agreement, dated as of
April 30, 2019 (as may be amended, modified, supplemented, renewed,
restated or replaced from time to time, the “Credit Agreement”), by
and among Borrowing Agent (together with each other Person joined
thereto as a borrower from time to time, collectively, the
“Borrowers”, and each a
“Borrower”), Car.com, Inc,
a Delaware corporation (“Car.com”), Autobytel,
Inc., a Delaware corporation (“Autobytel”), AW GUA USA,
Inc., a Delaware corporation (“AW GUA USA”, and
together with Car.com, Autobytel and each other Person joined
thereto as a guarantor from time to time, collectively, the
“Guarantors”, and each a
“Guarantor” and together
with the Borrowers, collectively the “Loan Parties” and each a
“Loan
Party”), the financial institutions party thereto as
lenders from time to time (collectively, the “Lenders” and each a
“Lender”) and Agent, the
Loan Parties are in compliance for the [month / quarter / fiscal
year] ending __________________, 20___ with all required covenants
set forth in the Credit Agreement and no Default or Event of
Default exists (if not true, in
the “Comments Regarding Exceptions” section below
specify the Default or Event of Default, its nature, when it
occurred, whether it is continuing and the steps being taken by the
Loan Parties with respect to such Default or Event of
Default). Capitalized terms used in this Compliance
Certificate and not otherwise defined herein shall have the
meanings ascribed to them in the Credit Agreement.

 

Without
limiting the foregoing, the undersigned certifies that the Loan
Parties are in compliance with the requirements or restrictions
imposed by Sections 6.5, 7.3, 7.4, 7.5, 7.6, 7.7, 7.8, 7.10 and
7.11 of the Credit Agreement, except as may be set forth
below

 

Attached hereto as
Schedule A are
covenant calculations which show such compliance (or
non-compliance) with Section 6.5 and 7.6 of the Credit
Agreement.

 

Compliance
status is indicated by circling Yes/No under “Complies”
column.

 

	

Financial Covenants

	

Required

	

Actual

	

Complies

	

Section 6.5 – Minimum EBITDA

	

>$

	

$

	

Yes No

	

Section 7.6 – Maximum
Capital Expenditures

	

≤ $

	

$_____________

	

Yes            No

	

Other
Covenants

	

Complies

	

Section
7.2
–                                 Liens

	

Yes            No

	

Section
7.3
–                                 Guarantees

	

Yes            No

	

Section
7.4
–                                 Investments

	

Yes            No

	

Section
7.5
–                                 Loans

	

Yes            No

	

Section
7.7
–                                 Dividends

	

Yes            No

	

Section
7.8
–                                 Indebtedness

	

Yes            No

	

Section
7.10
–                              
Transactions with Affiliates

	

Yes            No

	

Section
7.11
–                              
Leases

	

Yes            No

 

 

-109-

 

 

 

To my
knowledge, each Loan Party is in compliance with all Environmental
Laws except where such non-compliance could not reasonably be
expected to have a Material Adverse Effect.

 

Since
the date of the last Compliance Certificate, there has been no
change to the Loan Parties’ operating or other deposit
accounts, securities accounts, commodities accounts, and other
accounts at which any Loan Party maintains funds or investments (it
being understood that changes to the amounts in such accounts do
not constitute changes for the purposes of this statement), except
as set forth below: __________________.

 

Since
the date of the last Compliance Certificate, there has been no
change to the Loan Parties’ registered Intellectual Property,
including any applications for any of the foregoing, except as set
forth below:
________________________________________________.

Since
the date of the last Compliance Certificate, there has been no
change to the Loan Parties’ leased locations or to locations
of equipment and Inventory (other than those locations permitted in
the Credit Agreement), except as set forth below:
__________________________.

 

[Attached as
Exhibit I hereto are updates to the following schedules as
permitted by Section 9.17 of the Credit Agreement]

Comments
Regarding Exceptions:
________________________________________.

 

[signature page follows]

 

 

-110-

 

Very
truly yours,

 

AUTOWEB,
INC.

as
Borrowing Agent

 

By:__________________________                                               

Name:

Title:

 

 

 

 

-111-

 

SCHEDULE A TO COMPLIANCE CERTIFICATE

 

Calculations

 

-112-

 

EXHIBIT I TO COMPLIANCE CERTIFICATE

 

Updates
to Schedules

 

 

 

 

 

 

 

-113-

 

Exhibit
2.1

Form of
Revolving Credit Note

 

REVOLVING
CREDIT NOTE

 

	

$[____________]

	
 

	

[______
__, 201_]

	
 

	
 

	
 

FOR
VALUE RECEIVED, AUTOWEB,
INC., a Delaware corporation (“AutoWeb” and together
with each Person joined to the Credit Agreement (as defined below)
as a borrower from time to time, collectively, the
“Borrowers” and each a
“Borrower”), hereby
jointly and severally promise to pay to the order of __________________ (the
“Holder”), at the Payment
Office: at the end of the Term (as defined in the Credit Agreement)
and/or earlier as provided in the Credit Agreement, the principal
sum of [______________] DOLLARS ($[___________]) or such lesser sum
which then represents Holder’s Revolving Commitment
Percentage of the aggregate unpaid principal amount of all
Revolving Advances made or extended to Borrowers by Holder pursuant
to the Credit Agreement, in lawful money of the United States of
America in immediately available funds, together with interest on
the principal hereunder remaining unpaid from time to time, at the
rate or rates from time to time in effect under the Credit
Agreement.

 

THIS
REVOLVING CREDIT NOTE is executed and delivered under and pursuant
to the terms of that certain Revolving Credit and Security
Agreement, dated as of the date hereof (as the same may be amended,
modified, supplemented, renewed, restated or replaced from time to
time, the “Credit
Agreement”), by and among the Borrowers, each Person
joined thereto as a guarantor from time to time (collectively, the
“Guarantors” and each a
“Guarantor” and together
with the Borrowers, collectively the “Loan Parties” and each a
“Loan
Party”), the financial institutions named therein or
which hereafter become a party thereto as lenders (the
“Lenders”), and PNC Bank,
National Association, in its capacity as agent for Lenders (in such
capacity, “Agent”). Capitalized
terms used herein and not otherwise defined herein shall have the
meanings ascribed to them in the Credit Agreement.

 

Borrowers hereby
waive diligence, presentment, demand, protest and notice of any
kind whatsoever as further set forth in the Credit
Agreement.

 

This
Revolving Credit Note is one of the Notes referred to in the Credit
Agreement, which among other things, contains provisions for the
acceleration of the maturity hereof upon the happening of certain
events, for optional and mandatory prepayments of the principal
hereof prior to the maturity hereof and for the amendment or waiver
of certain terms and conditions therein specified.

 

THIS
REVOLVING CREDIT NOTE, AND ALL MATTERS RELATING HERETO OR ARISING
HEREFROM (WHETHER ARISING UNDER CONTRACT LAW, TORT LAW OR
OTHERWISE), SHALL, IN ACCORDANCE WITH SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK, BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK.

 

EACH
BORROWER HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY
CLAIM, COUNTERCLAIM, DEMAND, ACTION OR CAUSE OF ACTION (A) ARISING
UNDER THIS REVOLVING CREDIT NOTE, ANY OTHER DOCUMENT OR ANY OTHER
INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN
CONNECTION HEREWITH, OR (B) IN ANY WAY CONNECTED WITH OR RELATED OR
INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM
WITH RESPECT TO THIS REVOLVING CREDIT NOTE, ANY OTHER DOCUMENT OR
ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED
IN CONNECTION HEREWITH, OR THE TRANSACTIONS RELATED HERETO OR
THERETO IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND
WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE AND EACH BORROWER
HEREBY CONSENTS THAT ANY SUCH CLAIM, COUNTERCLAIM, DEMAND, ACTION
OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY,
AND THAT ANY BORROWER MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF
THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENTS OF
THE BORROWERS HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY
JURY.

 

[Signatures to
Follow on Separate Page]

 

 

-114-

 

IN
WITNESS WHEREOF, the undersigned have executed this Revolving
Credit Note the day and year first written above intending to be
legally bound hereby.

 

AUTOWEB,
INC.

 

 

By:
__________________________

Name:

Title:

 

 

 

 

 

 

 

 

 

 

-115-

 

Exhibit
2.4

Form of
Swing Loan Note

 

 SWING
LOAN NOTE

 

	

$[_____________]

	
 

	

[_________
__, 201_]

	
 

	
 

	
 

FOR
VALUE RECEIVED, AUTOWEB,
INC., a Delaware corporation (“AutoWeb” and together
with each Person joined to the Credit Agreement (as defined below)
as a borrower from time to time, collectively, the
“Borrowers” and each
individually a “Borrower”), hereby
jointly and severally promise to pay to the order of PNC BANK,
NATIONAL ASSOCIATION (the “Holder”), at the Payment
Office, the principal sum of [___________________] DOLLARS
($[______________]) or such lesser sum which then represents the
aggregate unpaid principal amount of all Swing Loans made or
extended to Borrowers by the Holder pursuant to the Credit
Agreement, in lawful money of the United States of America in
immediately available funds, together with interest on the
principal hereunder remaining unpaid from time to time, at the rate
or rates from time to time in effect under the Credit Agreement;
provided,
however, that the
entire unpaid principal balance of this Swing Loan Note shall be
due and payable in full at the end of the Term, or earlier as
provided in the Credit Agreement.

 

THIS
SWING LOAN NOTE is executed and delivered under and pursuant to the
terms of that certain Revolving Credit and Security Agreement,
dated as of the date hereof (as the same may be amended, modified,
supplemented, renewed, restated or replaced from time to time, the
“Credit
Agreement”), by and among the Borrowers, each Person
joined thereto as a guarantor from time to time (collectively, the
“Guarantors” and each a
“Guarantor” and together
with the Borrowers, collectively the “Loan Parties” and each a
“Loan
Party”), the financial institutions named therein or
which hereafter become a party thereto as lenders (the
“Lenders”), and PNC Bank,
National Association, in its capacity as agent for Lenders (in such
capacity, “Agent”). Capitalized
terms used herein and not otherwise defined herein shall have the
meanings ascribed to them in the Credit Agreement.

 

Each
Borrower hereby waives diligence, presentment, demand, protest and
notice of any kind whatsoever as further set forth in the Credit
Agreement.

 

This
Swing Loan Note is one of the Notes referred to in the Credit
Agreement, which among other things, contains provisions for the
acceleration of the maturity hereof upon the happening of certain
events, for optional and mandatory prepayments of the principal
hereof prior to the maturity hereof and for the amendment or waiver
of certain terms and conditions therein specified.

 

THIS
SWING LOAN NOTE, AND ALL MATTERS RELATING HERETO OR ARISING
HEREFROM (WHETHER ARISING UNDER CONTRACT LAW, TORT LAW OR
OTHERWISE), SHALL, IN ACCORDANCE WITH SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK, BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK.

 

 

EACH
BORROWER HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY
CLAIM, COUNTERCLAIM, DEMAND, ACTION OR CAUSE OF ACTION (A) ARISING
UNDER THIS SWING LOAN NOTE, ANY OTHER DOCUMENT OR ANY OTHER
INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN
CONNECTION HEREWITH, OR (B) IN ANY WAY CONNECTED WITH OR RELATED OR
INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM
WITH RESPECT TO THIS SWING LOAN NOTE, ANY OTHER DOCUMENT OR ANY
OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN
CONNECTION HEREWITH, OR THE TRANSACTIONS RELATED HERETO OR THERETO
IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER
SOUNDING IN CONTRACT OR TORT OR OTHERWISE AND EACH BORROWER HEREBY
CONSENTS THAT ANY SUCH CLAIM, COUNTERCLAIM, DEMAND, ACTION OR CAUSE
OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT
ANY BORROWER MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS
SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENTS OF THE
BORROWERS HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY
JURY.

 

[Signatures
to Follow on Separate Page]

 

-116-

 

IN
WITNESS WHEREOF, the undersigned have executed this Swing Loan Note
the day and year first written above intending to be legally bound
hereby.

 

AUTOWEB,
INC.

 

By:
__________________________

Name:

Title:

 

 

-117-

 

EXHIBIT 3.10-1

 

[FORM OF]

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Lenders That Are Not Partnerships For U.S. Federal
Income Tax Purposes)

 

Reference is hereby made to the Revolving Credit
and Security Agreement, dated as of April 30, 2019 (as amended,
modified, supplemented, renewed, restated or replaced from time to
time, the “Credit
Agreement”), by and
among AUTOWEB, INC., a Delaware corporation
(“AutoWeb”, and together
with each Person joined thereto as a borrower from time to time,
collectively, the “Borrowers” and each a
“Borrower”), CAR.COM,
INC., a Delaware corporation (“Car.com”), AUTOBYTEL,
INC., a Delaware corporation (“Autobytel”), AW GUA USA,
INC., a Delaware corporation (“AW GUA USA”, and together
with Car.com, Autobytel and each Person joined thereto as a
guarantor from time to time, collectively, the “Guarantors”, and each a
“Guarantor” and together
with the Borrowers, collectively, the “Loan Parties” and each a
“Loan
Party”), the financial institutions which are now or
which hereafter become a party thereto (together with their
respective successors and assigns, collectively, the
“Lenders” and each
individually a “Lender”), and PNC BANK,
NATIONAL ASSOCIATION (“PNC”), in its capacity as
agent for Lenders (in such capacity, together with its successors
and assigns, the “Agent”).

 

Pursuant
to the provisions of Section 3.10 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record and
beneficial owner of the Loan(s) (as well as any Note(s) evidencing
such Obligation(s)) in respect of which it is providing this
certificate, (ii) it is not a bank within the meaning of Section
881(c)(3)(A) of the Code, (iii) it is not a ten percent shareholder
of any Borrower within the meaning of Section 871(h)(3)(B) of the
Code and (iv) it is not a controlled foreign corporation related to
any Borrower as described in Section 881(c)(3)(C) of the
Code.

 

The
undersigned has furnished Agent and the Borrowers with a
certificate of its non-U.S. Person status on IRS Form W-8BEN or IRS
Form W-8BEN-E. By executing this certificate, the undersigned
agrees that (1) if the information provided on this certificate
changes, the undersigned shall promptly so inform the Borrowers and
Agent, and (2) the undersigned shall have at all times furnished
the Borrowers and Agent with a properly completed and currently
effective certificate in either the calendar year in which each
payment is to be made to the undersigned, or in either of the two
calendar years preceding such payments.

 

Unless
otherwise defined herein, terms defined in the Credit Agreement and
used herein shall have the meanings given to them in the Credit
Agreement.

 

	

[NAME OF LENDER]

 

	

By:                                                                           

	
 

	

Name:

	
 

	

Title:

Date: ________ __, 20[ ]

 

 

-118-

 

 EXHIBIT 3.10-2

 

[FORM OF]

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Participants That Are Not Partnerships For U.S.
Federal Income Tax Purposes)

 

Reference is hereby made to the Revolving Credit
and Security Agreement, dated as of April 30, 2019 (as amended,
modified, supplemented, renewed, restated or replaced from time to
time, the “Credit
Agreement”), by and
among AUTOWEB, INC., a Delaware corporation
(“AutoWeb”, and together
with each Person joined thereto as a borrower from time to time,
collectively, the “Borrowers” and each a
“Borrower”), CAR.COM,
INC., a Delaware corporation (“Car.com”), AUTOBYTEL,
INC., a Delaware corporation (“Autobytel”), AW GUA USA,
INC., a Delaware corporation (“AW GUA USA”, and together
with Car.com, Autobytel and each Person joined thereto as a
guarantor from time to time, collectively, the “Guarantors”, and each a
“Guarantor” and together
with the Borrowers, collectively, the “Loan Parties” and each a
“Loan
Party”), the financial institutions which are now or
which hereafter become a party thereto (together with their
respective successors and assigns, collectively, the
“Lenders” and each
individually a “Lender”), and PNC BANK,
NATIONAL ASSOCIATION (“PNC”), in its capacity as
agent for Lenders (in such capacity, together with its successors
and assigns, the “Agent”).

 

Pursuant
to the provisions of Section 3.10 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record and
beneficial owner of the participation in respect of which it is
providing this certificate, (ii) it is not a bank within the
meaning of Section 881(c)(3)(A) of the Code, (iii) it is not a ten
percent shareholder of any Borrower within the meaning of
Section 871(h)(3)(B) of the Code, and (iv) it is not a
controlled foreign corporation related to any Borrower as described
in Section 881(c)(3)(C) of the Code.

 

The
undersigned has furnished its participating Lender with a
certificate of its non-U.S. Person status on IRS Form W-8BEN or IRS
Form W-8BEN-E. By executing this certificate, the undersigned
agrees that (1) if the information provided on this certificate
changes, the undersigned shall promptly so inform such Lender in
writing, and (2) the undersigned shall have at all times furnished
such Lender with a properly completed and currently effective
certificate in either the calendar year in which each payment is to
be made to the undersigned, or in either of the two calendar years
preceding such payments.

 

Unless
otherwise defined herein, terms defined in the Credit Agreement and
used herein shall have the meanings given to them in the Credit
Agreement.

 

	

[NAME OF PARTICIPANT]

	

 

By:                                                                           

	
 

	

Name:

	
 

	

Title:

Date: ________ __, 20[ ]

 

 

-119-

 

EXHIBIT 3.10-3

 

[FORM OF]

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Participants That Are Partnerships For U.S. Federal
Income Tax Purposes)

 

Reference is hereby made to the Revolving Credit
and Security Agreement, dated as of April 30, 2019 (as amended,
modified, supplemented, renewed, restated or replaced from time to
time, the “Credit
Agreement”), by and
among AUTOWEB, INC., a Delaware corporation
(“AutoWeb”, and together
with each Person joined thereto as a borrower from time to time,
collectively, the “Borrowers” and each a
“Borrower”), CAR.COM,
INC., a Delaware corporation (“Car.com”), AUTOBYTEL,
INC., a Delaware corporation (“Autobytel”), AW GUA USA,
INC., a Delaware corporation (“AW GUA USA”, and together
with Car.com, Autobytel and each Person joined thereto as a
guarantor from time to time, collectively, the “Guarantors”, and each a
“Guarantor” and together
with the Borrowers, collectively, the “Loan Parties” and each a
“Loan
Party”), the financial institutions which are now or
which hereafter become a party thereto (together with their
respective successors and assigns, collectively, the
“Lenders” and each
individually a “Lender”), and PNC BANK,
NATIONAL ASSOCIATION (“PNC”), in its capacity as
agent for Lenders (in such capacity, together with its successors
and assigns, the “Agent”).

 

Pursuant
to the provisions of Section 3.10 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record owner
of the participation in respect of which it is providing this
certificate, (ii) its direct or indirect partners/members are the
sole beneficial owners of such participation, (iii) with respect
such participation, neither the undersigned nor any of its direct
or indirect partners/members is a bank extending credit pursuant to
a loan agreement entered into in the ordinary course of its trade
or business within the meaning of Section 881(c)(3)(A) of the Code,
(iv) none of its direct or indirect partners/members is a ten
percent shareholder of any Borrower within the meaning of Section
871(h)(3)(B) of the Code and (v) none of its direct or indirect
partners/members is a controlled foreign corporation related to any
Borrower as described in Section 881(c)(3)(C) of the
Code.

 

The
undersigned has furnished its participating Lender with IRS Form
W-8IMY accompanied by one of the following forms from each of its
partners/members that is claiming the portfolio interest exemption:
(i) an IRS Form W-8BEN or IRS Form W-8BEN-E or (ii) an IRS Form
W-8IMY accompanied by an IRS Form W-8BEN or IRS Form W-8BEN-E from
each of such partner’s/member’s beneficial owners that
is claiming the portfolio interest exemption. By executing this
certificate, the undersigned agrees that (1) if the information
provided on this certificate changes, the undersigned shall
promptly so inform such Lender and (2) the undersigned shall have
at all times furnished such Lender with a properly completed and
currently effective certificate in either the calendar year in
which each payment is to be made to the undersigned, or in either
of the two calendar years preceding such payments.

 

Unless
otherwise defined herein, terms defined in the Credit Agreement and
used herein shall have the meanings given to them in the Credit
Agreement.

 

	

[NAME OF PARTICIPANT]

	

 

By:                                                                           

	
 

	

Name:

	
 

	

Title:

Date: ________ __, 20[ ]

 

 

-120-

 

EXHIBIT 3.10-4

 

[FORM OF]

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Lenders That Are Partnerships For U.S. Federal Income
Tax Purposes)

 

Reference is hereby made to the Revolving Credit
and Security Agreement, dated as of April 30, 2019 (as amended,
modified, supplemented, renewed, restated or replaced from time to
time, the “Credit
Agreement”), by and
among AUTOWEB, INC., a Delaware corporation
(“AutoWeb”, and together
with each Person joined thereto as a borrower from time to time,
collectively, the “Borrowers” and each a
“Borrower”), CAR.COM,
INC., a Delaware corporation (“Car.com”), AUTOBYTEL,
INC., a Delaware corporation (“Autobytel”), AW GUA USA,
INC., a Delaware corporation (“AW GUA USA”, and together
with Car.com, Autobytel and each Person joined thereto as a
guarantor from time to time, collectively, the “Guarantors”, and each a
“Guarantor” and together
with the Borrowers, collectively, the “Loan Parties” and each a
“Loan
Party”), the financial institutions which are now or
which hereafter become a party thereto (together with their
respective successors and assigns, collectively, the
“Lenders” and each
individually a “Lender”), and PNC BANK,
NATIONAL ASSOCIATION (“PNC”), in its capacity as
agent for Lenders (in such capacity, together with its successors
and assigns, the “Agent”).

 

Pursuant
to the provisions of Section 3.10 of the Credit Agreement, the
undersigned hereby certifies that (i) it is the sole record owner
of the Loan(s) (as well as any Note(s) evidencing such Loan(s)) in
respect of which it is providing this certificate, (ii) its direct
or indirect partners/members are the sole beneficial owners of such
Loan(s) (as well as any Note(s) evidencing such Obligation(s)),
(iii) with respect to the extension of credit pursuant to this
Credit Agreement or any Other Document, neither the undersigned nor
any of its direct or indirect partners/members is a bank extending
credit pursuant to a loan agreement entered into in the ordinary
course of its trade or business within the meaning of Section
881(c)(3)(A) of the Code, (iv) none of its direct or indirect
partners/members is a ten percent shareholder of any Borrower
within the meaning of Section 871(h)(3)(B) of the Code and (v) none
of its direct or indirect partners/members is a controlled foreign
corporation related to any Borrower as described in Section
881(c)(3)(C) of the Code.

 

The
undersigned has furnished Agent and the Borrowers with IRS Form
W-8IMY accompanied by one of the following forms from each of its
partners/members that is claiming the portfolio interest exemption:
(i) an IRS Form W-8BEN or IRS Form W-8BEN-E or (ii) an IRS Form
W-8IMY accompanied by an IRS Form W-8BEN or IRS Form W-8BEN-E from
each of such partner’s/member’s beneficial owners that
is claiming the portfolio interest exemption. By executing this
certificate, the undersigned agrees that (1) if the information
provided on this certificate changes, the undersigned shall
promptly so inform the Borrowers and Agent, and (2) the undersigned
shall have at all times furnished the Borrowers and Agent with a
properly completed and currently effective certificate in either
the calendar year in which each payment is to be made to the
undersigned, or in either of the two calendar years preceding such
payments.

 

Unless
otherwise defined herein, terms defined in the Credit Agreement and
used herein shall have the meanings given to them in the Credit
Agreement.

 

	

[NAME OF LENDER]

	

 

By:                                                                           

	
 

	

Name:

	
 

	

Title:

Date: ________ __, 20[ ]

 

 

-121-

 

 

Exhibit
8.1(b)

Form of
Financial Condition Certificate

 

FINANCIAL
CONDITION CERTIFICATE

 

April
30, 2019

 

TO:           PNC
BANK, NATIONAL ASSOCIATION, in its capacity as agent for the
Lenders described below (in such capacity, together with its
successors and assigns, the “Agent”), in connection
with that certain Revolving Credit and Security Agreement, dated of
even date herewith (as may be
supplemented, restated, superseded, amended or replaced from time
to time, the “Credit Agreement”), among
AUTOWEB, INC., a Delaware (“AutoWeb” together with
each other Person joined thereto as a borrower from time to time,
collectively, the “Borrowers” and each a
“Borrower”), CAR.COM,
INC., a Delaware corporation (“Car.com”), AUTOBYTEL,
INC., a Delaware corporation (“Autobytel”), AW GUA USA,
INC., a Delaware corporation (“AW GUA USA”, and together
with Car.com, Autobytel and each other Person joined thereto as a
guarantor from time to time, collectively, the “Guarantors” and each a
“Guarantor” and together
with the Borrowers, collectively the “Loan Parties” and each a
“Loan
Party”), the financial institutions party thereto as
lenders from time to time (collectively, the “Lenders” and each a
“Lender”) and Agent.
Capitalized terms used herein and not otherwise defined herein
shall have the meanings ascribed to them in the Credit
Agreement.

 

In
connection with the Credit Agreement and the Other Documents, I
hereby certify that, effective as of the Closing Date, I am the
duly elected, qualified and acting [Chief Financial Officer] of
each Loan Party and, in such capacity, I hereby conclude to my
knowledge that:

 

A.           The
execution and delivery of the Credit Agreement and the Other
Documents and the granting of any security interests or Liens
pursuant to the Credit Agreement and the Other Documents by the
Loan Parties will not render any Loan Party insolvent. I understand
that, in this context, “insolvent” with respect to a
Loan Party means that the present fair valuation of such Loan
Party’s assets taken as a whole is less than the present fair
valuation of its probable liabilities.

 

B.           The
execution and delivery of the Credit Agreement and the Other
Documents and the granting of the security interests and Liens by
each Loan Party pursuant to the Credit Agreement and the Other
Documents will not leave any Loan Party with property which would
constitute unreasonably small capital for such Loan Party’s
business or the business of the Loan Parties taken as a whole. In
reaching this conclusion, I understand that “unreasonably
small capital” depends upon the nature of the business of the
Loan Parties as presently conducted, and I have reached my
conclusion based on the actual and reasonably anticipated needs for
capital of the business anticipated to be conducted by the Loan
Parties and consistent with the Projections and other information
described herein.

 

C.           I
conclude that the Loan Parties will not, taken as a whole, likely
incur debts beyond their ability to pay as such debts mature. This
conclusion is based, in part, upon my review of the Projections,
which project that the Loan Parties will have positive cash flow
after paying all of their scheduled and anticipated Indebtedness as
it matures. I have concluded that the realization from the assets
of the Loan Parties in the Ordinary Course of Business, taken as a
whole, will be sufficient to pay their recurring current debt,
short term debt, and long term debt as such debts
require.

 

D.           No
Loan Party has executed the Credit Agreement or any of the Other
Documents or made any transfer or incurred any obligations
thereunder with actual intent to hinder, delay, or defraud either
present or future creditors.

 

I
understand that Agent and the Lenders are relying on the truth and
accuracy of the foregoing in connection with the extensions of
credit under the Credit Agreement.

 

[Signatures
to Follow on Separate Page]

 

-122-

 

I
hereby certify, in my capacity as [Chief Financial Officer] of each
Loan Party, and not individually, that the foregoing information is
true and correct and execute this certificate as of the date first
written above.

 

AUTOWEB,
INC.

 

By:
______________________________

Name:

Title:
[______][Chief Financial Officer]

 

CAR.COM,
INC.

 

By:
______________________________

Name:

Title:
[______][Chief Financial Officer]

 

AUTOBYTEL,
INC.

 

By:
______________________________

Name:

Title:
[______][Chief Financial Officer]

 

AW GUA
USA, INC.

 

By:
______________________________

Name:

Title:
[______][Chief Financial Officer]

 

 

 

 

 

-123-

 

Exhibit
16.3

Form of
Commitment Transfer Supplement

 

COMMITMENT
TRANSFER SUPPLEMENT

 

This
COMMITMENT TRANSFER SUPPLEMENT, dated as of [___________], 201[_]
(this “Commitment
Transfer Supplement”), by and among __________________
(“Transferor
Lender”), ______________ (“Purchasing Lender”), and
PNC Bank, National
Association, as agent for the Lenders under the Credit
Agreement (as defined below) (in such capacity, the
“Agent”).

 

W I
T N E S S E T H

 

WHEREAS, this
Commitment Transfer Supplement is being executed and delivered in
accordance with Section 16.3 of that certain Revolving Credit and
Security Agreement, dated as of April 30, 2019 (as amended,
modified, supplemented, renewed, restated or replaced from time to
time, the “Credit
Agreement”), by and among AUTOWEB, INC., a Delaware
(“AutoWeb]” together with
each other Person joined thereto as a borrower from time to time,
collectively, the “Borrowers”, and each a
“Borrower”), certain
Subsidiaries of AutoWeb and each other Person joined thereto as a
guarantor from time to time (collectively, the “Guarantors” and each a
“Guarantor” and together
with the Borrowers, collectively the “Loan Parties” and each a
“Loan
Party”), the financial institutions party thereto as
lenders from time to time (collectively, the “Lenders” and each a
“Lender”) and
Agent.

 

WHEREAS, Purchasing
Lender wishes to become a Lender party to the Credit Agreement;
and

 

WHEREAS, the
Transferor Lender is selling and assigning to Purchasing Lender
rights, obligations and commitments under the Credit
Agreement;

 

NOW,
THEREFORE, the parties hereto hereby agree as follows:

 

1.           

All capitalized
terms used herein which are not defined shall have the meanings
given to them in the Credit Agreement.

 

2.           

Upon receipt by
Agent of four counterparts of this Commitment Transfer Supplement,
to each of which is attached a fully completed Schedule I, and each of which
has been executed by the Transferor Lender and Agent, Agent will
transmit to Transferor Lender and Purchasing Lender a Transfer
Effective Notice, substantially in the form of Schedule II to this Commitment
Transfer Supplement (a “Transfer Effective
Notice”). Such Transfer Effective Notice shall set
forth, inter
alia, the date on
which the transfer effected by this Commitment Transfer Supplement
shall become effective (the “Transfer Effective
Date”), which date unless otherwise noted therein,
shall not be earlier than the first Business Day following the date
such Transfer Effective Notice is received. From and after the
Transfer Effective Date, Purchasing Lender shall be a Lender party
to the Credit Agreement for all purposes thereof.

 

3.           

At or before 12:00
Noon (New York time) on the Transfer Effective Date Purchasing
Lender shall pay to Transferor Lender, in immediately available
funds, an amount equal to the purchase price, as agreed between
Transferor Lender and such Purchasing Lender (the
“Purchase
Price”), of the portion of the Advances being
purchased by such Purchasing Lender (such Purchasing Lender’s
“Purchased
Percentage”) of the outstanding Advances and other
amounts owing to the Transferor Lender under the Credit Agreement,
and the Note(s). Effective upon receipt by Transferor Lender of the
Purchase Price from a Purchasing Lender, Transferor Lender hereby
irrevocably sells, assigns and transfers to such Purchasing Lender,
without recourse, representation or warranty, and Purchasing Lender
hereby irrevocably purchases, takes and assumes from Transferor
Lender, such Purchasing Lender’s Purchased Percentage of the
Advances and other amounts owing to the Transferor Lender under the
Credit Agreement and the Note(s) together with all instruments,
documents and collateral security pertaining thereto.

 

 

 

 

-124-

 

 

 

4.            

Transferor Lender
has made arrangements with Purchasing Lender with respect to (i)
the portion, if any, to be paid, and the date or dates for payment,
by Transferor Lender to such Purchasing Lender of any fees
heretofore received by Transferor Lender pursuant to the Credit
Agreement prior to the Transfer Effective Date and (ii) the
portion, if any, to be paid, and the date or dates of payment, by
such Purchasing Lender to Transferor Lender of fees or interest
received by such Purchasing Lender pursuant to the Credit Agreement
from and after the Transfer Effective Date.

 

5.           (a)           All
principal payments that would otherwise be payable from and after
the Transfer Effective Date to or for the account of Transferor
Lender pursuant to the Credit Agreement and the Note(s) shall,
instead, be payable to or for the account of Transferor Lender and
Purchasing Lender, as the case may be, in accordance with their
respective interests as reflected in this Commitment Transfer
Supplement.

 

(b)        
All interest, fees and other amounts that would otherwise accrue
for the account of Transferor Lender from and after the Transfer
Effective Date pursuant to the Credit Agreement and the Note(s)
shall, instead, accrue for the account of, and be payable to,
Transferor Lender and Purchasing Lender, as the case may be, in
accordance with their respective interests as reflected in this
Commitment Transfer Supplement. In the event that any amount of
interest, fees or other amounts accruing prior to the Transfer
Effective Date was included in the Purchase Price paid by any
Purchasing Lender, Transferor Lender and Purchasing Lender will
make appropriate arrangements for payment by Transferor Lender to
such Purchasing Lender of such amount upon receipt thereof from
Borrowers.

 

6.           

Concurrently with
the execution and delivery hereof, Transferor Lender will provide
to Purchasing Lender conformed copies of the Credit Agreement and
all related documents delivered to Transferor Lender.

 

7.           

Each of the parties
to this Commitment Transfer Supplement agrees that at any time and
from time to time upon the written request of any other party, it
will execute and deliver such further documents and do such further
acts and things as such other party may reasonably request in order
to effect the purposes of this Commitment Transfer
Supplement.

 

8.           

By executing and
delivering this Commitment Transfer Supplement, Transferor Lender
and Purchasing Lender confirm to and agree with each other and
Agent and Lenders as follows: (i) other than the representation and
warranty that it is the legal and beneficial owner of the interest
being assigned hereby free and clear of any adverse claim,
Transferor Lender makes no representation or warranty and assumes
no responsibility with respect to any statements, warranties or
representations made in or in connection with the Credit Agreement
or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of the Credit Agreement, the Note(s) or any
other instrument or document provided pursuant thereto;
(ii) Transferor Lender makes no representation or warranty and
assumes no responsibility with respect to the financial condition
of Borrowers or the performance or observance by Borrowers of any
of their Obligations under the Credit Agreement or any of the Other
Documents; (iii) Purchasing Lender confirms that it has received a
copy of the Credit Agreement, together with copies of such
financial statements and such other documents and information as it
has deemed appropriate to make its own credit analysis and decision
to enter into this Commitment Transfer Supplement; (iv) Purchasing
Lender will, independently and without reliance upon Agent,
Transferor Lender or any other Lenders and based on such documents
and information as it shall deem appropriate at the time, continue
to make its own credit decisions in taking or not taking action
under the Credit Agreement; (v) Purchasing Lender appoints and
authorizes Agent to take such action as agent on its behalf and to
exercise such powers under the Credit Agreement as are delegated to
Agent by the terms thereof; (vi) Purchasing Lender agrees that it
will perform all of its respective obligations as set forth in the
Credit Agreement to be performed by each as a Lender; and (vii)
Purchasing Lender represents and warrants to Transferor Lender,
Lenders, each Agent and Borrowers that it (A) has full power,
authority and legal right to enter into this Commitment Transfer
Supplement and to perform all of its obligations as set forth in
the Credit Agreement and the Other Documents, (B) is duly formed
and in good standing under the laws of the State of [_______] and
(C) is either (x) entitled to the benefits of an income tax treaty
with the United States of America that provides for an exemption
from the United States withholding tax on interest and other
payments made by Borrowers under the Credit Agreement and Other
Documents or (y) is engaged in trade or business within the United
States of America.

 

 

 

-125-

 

 

9.           

By executing and
delivering this Commitment Transfer Supplement, Purchasing Lender
hereby represents and warrants to
Transferor Lender that: (a) no Covered Entity (as hereinafter
defined) (i) is a Sanctioned Person; (ii) has any of its assets in
a Sanctioned Country or in the possession, custody or control of a
Sanctioned Person; or (iii) does business in or with, or derives
any of its operating income from investments in or transactions
with, any Sanctioned Country or Sanctioned Person in violation of
any law, regulation, order or directive enforced by any Compliance
Authority; (b) the funds used to purchase the Advances pursuant to
this Commitment Transfer Supplement are not derived from any
unlawful activity; and (c) each Covered Entity is in compliance
with, and no Covered Entity engages in any dealings or transactions
prohibited by, the laws of the United States, including but not
limited to any Anti-Terrorism Laws.  As
used herein: (I) the term “Anti-Terrorism
Laws” means any Laws
relating to terrorism, trade sanctions programs and embargoes,
import/export licensing, money laundering or bribery, and any
regulation, order, or directive promulgated, issued or enforced
pursuant to such Laws, all as amended, supplemented or replaced
from time to time, (II) the term “Compliance
Authority” means each and all of the (a) U.S. Treasury
Department/Office of Foreign Assets Control, (b) U.S. Treasury
Department/Financial Crimes Enforcement Network, (c) U.S. State
Department/Directorate of Defense Trade Controls, (d) U.S. Commerce
Department/Bureau of Industry and Security, (e) U.S. Internal
Revenue Service, (f) U.S. Justice Department, and (g) U.S.
Securities and Exchange Commission, (III) the term
“Covered
Entity” means Purchasing
Lender, its Affiliates and Subsidiaries, all owners of the
foregoing, and all brokers or other agents of Purchasing Lender
acting in any capacity in connection with the transactions
contemplated by this Commitment Transfer Supplement, (IV) the term
“Sanctioned
Country” means a
country subject to a sanctions program maintained under any
Anti-Terrorism Law, and (V) the term
“Sanctioned
Person” means any
individual person, group, regime, entity or thing listed or
otherwise recognized as a specially designated, prohibited,
sanctioned or debarred person, group, regime, entity or thing, or
subject to any limitations or prohibitions (including but not
limited to the blocking of property or rejection of transactions),
under any Anti-Terrorism Law. Purchasing Lender has provided, and
has caused each other Covered Entity to provide, to the extent
requested by Transferor Lender, any and all certifications and
information that Transferor Lender has requested to confirm
compliance by Purchasing Lender and each other Covered Entity with
Anti-Terrorism Laws including, without limitation: (i) the name,
address and taxpayer identification number of Purchasing Lender and
of each other Covered Entity; and (ii) such information about
Purchasing Lender’s source of funds as Transferor Lender may
have requested to insure compliance with all Anti-Terrorism Laws.
No sale of the Advances shall be consummated until Purchasing
Lender has provided all required information to the satisfaction of
Transferor Lender.

   

10.           

Schedule I hereto sets forth
the revised Revolving Commitment Percentages of Transferor Lender
and the Revolving Commitment Percentages of Purchasing Lender as
well as administrative information with respect to Purchasing
Lender.

 

11.           

This Commitment
Transfer Supplement shall be governed by, and construed in
accordance with, the laws of the State of New York applied to
contracts to be performed wholly within the State of New York
(including Sections 5-1401 and 5-1402 of the New York General
Obligations Law, but excluding all other choice of law and
conflicts of law rules).

 

[Signatures
Begin on Next Page]

 

-126-

 

IN
WITNESS WHEREOF, the parties hereto have caused this Commitment
Transfer Supplement to be executed by their respective duly
authorized officers on the date set forth above.

 

[______________________________________]

as
Transferor Lender

 

 

By:________________________________

Name:

Title:

 

 

[______________________________________]

as
Purchasing Lender

 

By:
________________________________

Name:

Title:

 

PNC
BANK, NATIONAL ASSOCIATION,

as
Agent

 

By:________________________________

Name:

Title:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

-127-

 

 

SCHEDULE
I

TO

COMMITMENT
TRANSFER SUPPLEMENT

 

REVISED
COMMITMENT AMOUNTS OF

TRANSFEROR LENDER AND PURCHASING LENDER

 

	

[TRANSFEROR
LENDER]

	

Revised
Revolving Commitment Amount

 

Revised
Revolving Commitment Percentage

 

 

 

	

$__________

 

 

___________%

 

 

 

 

	
 

	
 

	
 

	

[PURCHASING
LENDER]

	

Revolving
Commitment Amount

 

Revolving
Commitment Percentage

 

 

	

$___________

 

___________%

 

 

	
 

	
 

	
 

	
 

	
 

	
 

	

Addresses
for Notices for Purchasing Lender

 

Attention:

Telephone:

Telecopier:

	
 

	
 

 

-128-

 

SCHEDULE
II

TO

COMMITMENT
TRANSFER SUPPLEMENT

 

[Form
of Transfer Effective Notice]

 

To:                                            

, as Transferor
Lender

 

and

 

, as
Purchasing Lender:

 

The
undersigned, as Agent under the Revolving Credit and Security
Agreement, dated as of April 30, 2019, by and among AUTOWEB, INC.,
a Delaware (“AutoWeb”, together with each other Person
joined thereto as a borrower from time to time, collectively, the
“Borrowers”, and each a
“Borrower”), certain
Subsidiaries of AutoWeb and each other Person joined thereto as a
guarantor from time to time, collectively, the “Guarantors”, and each a
“Guarantor” and together
with the Borrowers, collectively the “Loan Parties” and each a
“Loan
Party”), each of the financial institutions party
thereto from time to time as lenders (collectively, the
“Lenders”), and
PNC Bank, National
Association as agent for the Lenders, acknowledges receipt
of four (4) executed counterparts of a completed Commitment
Transfer Supplement in the form attached hereto. [Note: Attach copy
of Commitment Transfer Supplement.] Capitalized terms defined in
the Commitment Transfer Supplement are used herein as therein
defined.

 

Pursuant to such
Commitment Transfer Supplement, you are advised that the Transfer
Effective Date will be [Insert date of Transfer Effective
Notice].

 

 

PNC
BANK, NATIONAL ASSOCIATION, as Agent

 

By:                                                                

Name:                      

Title:

 

 

 

ACCEPTED
FOR RECORDATION

  IN
REGISTER:

 

  

 

 

 

 

-129-

 

 

 

Schedule
1.1

Commitments

 

 

 

	

Lender

	

Revolving Commitment Amount

	

Revolving Commitment Percentage

	

Total Commitment

Amount

	

Total Commitment Percentage

	

PNC
Bank, National Association

	

$25,000,000

	

100%

	

$25,000,000

	

100%

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	

Total

	

$25,000,000

	

100%

	

$25,000,000

	

100%

 

 

 

 

 

 

-130-

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