Document:

CREDIT AGREEMENT

 Exhibit 10.1 
  

  
 CREDIT AGREEMENT 
  
 between 
  
 CYBEX INTERNATIONAL, INC., as Borrower 
  
 and 
  
 GMAC COMMERCIAL FINANCE LLC, as Lender 
  
 Dated as of July 13, 2004 
  

 THIS CREDIT AGREEMENT is made as of July 13, 2004, by and between CYBEX INTERNATIONAL, INC., a New York
corporation (the “Borrower”), having its chief executive office at 10 Trotter Drive, Medway, Massachusetts 11779 and GMAC COMMERCIAL FINANCE LLC (the “Lender”), having an office at 210 Interstate North Parkway, Suite 315,
Atlanta, Georgia 30339. 
  
 SECTION I 
 DEFINITIONS 
  
 1.1 Definitions. All capitalized terms used in this Agreement shall have the meanings assigned to them below: 
  
 Acquisition. Any transaction pursuant to which the Borrower or any of
its Subsidiaries (a) acquires any equity securities (or warrants, options or other rights to acquire such securities) of any Entity other than the Borrower or any Entity which is not then a Subsidiary of the Borrower, pursuant to a solicitation of
tenders therefor, or in one or more negotiated block, market or other transactions not involving a tender offer, or a combination of any of the foregoing, or (b) makes any Entity a Subsidiary of the Borrower, or causes any such Entity to be merged
into the Borrower or any of its Subsidiaries, in any case pursuant to a merger, purchase of assets or any reorganization providing for the delivery or issuance to the holders of such Entity’s then outstanding securities, in exchange for such
securities, cash or securities of the Borrower or any of its Subsidiaries, or a combination thereof, or (c) purchases all or substantially all of the business or assets of any Entity. 
  
 Affiliate. With respect to any Person, any other Person directly or indirectly controlling or controlled by or under
direct or indirect common control with such specified Person. For purposes of this definition, “control” when used with respect to any specified Person means the power to direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing. 
  
 Agreement. This Agreement, as the same maybe supplemented or amended
from time to time. 
  
 Beneficial Ownership. Beneficial
ownership as determined in accordance with Rule 13d-3 of the Securities and Exchange Commission under the Exchange Act, as in effect on the date hereof. 
  
 Borrower. See Preamble. 
  
 Business Day. As defined in each Note. 
  
 Capital Assets. Fixed assets, both tangible (such as land, buildings, fixtures, machinery and equipment) and intangible (such as patents,
copyrights, trademarks, franchises and good will); provided that Capital Assets shall not include any item customarily charged directly to expense or depreciated over a useful life of twelve (12) months or less in accordance with GAAP. 

 Capital Expenditures. For any period the aggregate of all expenditures of the Borrower during such
period that, in conformity with GAAP, are required to be included in or reflected by the property, plant or equipment or similar fixed asset account reflected in the balance sheet of the Borrower. 
  
 Capital Stock. Any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all equivalent ownership interests in an Entity (other than a corporation) and any and all warrants, rights or options to purchase any of the foregoing. 
  
 Capitalized Leases. Leases under which the Borrower or any of its
Subsidiaries is the lessee or obligor, the discounted future rental payment obligations under which are required to be capitalized on the balance sheet of the lessee or obligor in accordance with GAAP. 
  
 Change of Control. The occurrence of any of the following:

  
 (a) any Person or two or more Persons acting in concert shall
have acquired Beneficial Ownership, directly or indirectly, through a purchase, merger or other transaction or series of transactions or otherwise, of a number of shares of (i) common stock of the Borrower or (ii) Voting Stock of the Borrower, which
in either case exceeds the number of such shares then beneficially owned by UM Holdings, Ltd. and its Affiliates; or 
  
 (b) during any period of twelve (12) consecutive calendar months, individuals who were either (i) directors of the Borrower on the first day of such
period, or (ii) appointed or nominated for election to the board of directors by a majority of the individuals who were members of the board of directors on the first day of such period, shall cease to constitute a majority of the board of
directors. 
  
 Code. The Internal Revenue Code of 1986 and
the rules and regulations thereunder, collectively, as the same may from time to time be supplemented or amended and remain in effect. 
  
 Collateral. All property, real or personal, in which Lender is granted a lien, or security interest, or in which title or security title is granted
to or for the benefit of the Lender as security for the Obligations pursuant to the Security Documents. 
  
 Consolidated or consolidated. With reference to any term defined herein, shall mean that term as applied to the accounts of the Borrower and its
Subsidiaries, consolidated in accordance with GAAP. 
  
 Controlled Group. All trades or businesses (whether or not incorporated) under common control that, together with the Borrower, are treated as a single employer under Section 414(b) or 414(c) of the Code or Section 4001 of ERISA.

 Default. An Event of Default or event or condition that, but for the requirement that time elapse
or notice be given, or both, would constitute an Event of Default. 
  
 EBITDA. In any period, all earnings of the Borrower for said period before all interest and tax obligations of the Borrower for said period and all depreciation and amortization expense for said period, determined in accordance with
GAAP on a consistent basis with the latest audited financial statements of the Borrower, but excluding the effect of extraordinary or non-reoccurring gains or losses for such period. 
  
 Encumbrances. See Section 6.1. 
  
 Entity. Any corporation, limited liability company, partnership, limited liability partnership, trust, other
unincorporated association, business, or other legal entity, and any Governmental Authority. 
  
 Equipment. All present and hereafter acquired equipment (as defined in the UCC) including, without limitation, all machinery, equipment, furnishings and fixtures, and all additions, substitutions and
replacements thereof, wherever located, together with all attachments, components, parts, equipment and accessories installed thereon or affixed thereto and all proceeds thereof of whatever sort. 
  
 ERISA. The Employee Retirement Income Security Act of 1974 and the
rules and regulations thereunder, collectively, as the same may from time to time be supplemented or amended and remain in effect. 
  
 Event of Default. Any event described in Section 7.1. 
  
 Financial Covenants. The covenants set forth in Sections 5.9, and 5.10 herein. 
  
 Fixed Charge Coverage Ratio. For any Reference Period, the
ratio of the following for the Borrower and its Subsidiaries on a consolidated basis determined in accordance with GAAP: (a) EBITDA less non-financed Capital Expenditure for such period, less, without duplication, losses incurred in respect of
Support Obligations during such period, to (b) Fixed Charges for such period. 
  
 Fixed Charges. For any applicable twelve-month period of computation, the sum of (a) interest expense paid or accrued in respect of any Indebtedness during such period, without duplication, plus (b)
taxes to the extent paid during or with respect to such period plus (c) regularly scheduled payments of principal paid on Indebtedness (excluding the Revolving Facility) during such period. 
  
 Funded Debt. As of any date, the Indebtedness of the Borrower and its
Subsidiaries for money borrowed from financial institutions. 
  
 GAAP. Those generally accepted accounting principles and practices which are recognized as such by the American Institute of Certified Public Accountants acting through its 

 
Accounting Principles Board or by the Financial Accounting Standards Board or through other appropriate boards or committees thereof, as in effect on the
date hereof 
  
 Governmental Authority. Any foreign,
federal, state, regional, local, municipal or other government, or any department, commission, board, bureau, agency, public authority or instrumentality thereof, or any court or arbitrator. 
  
 Government Lists. (i) the Specially Designated Nationals and Blocked
Persons Lists maintained by OFAC, (ii) any other list of terrorists, terrorist organizations or narcotics traffickers maintained pursuant to any of the Rules and Regulations of OFAC, or (iii) any similar lists maintained by the United States
Department of State, the United States Department of Commerce or any other governmental authority or pursuant to any Executive Order of the President of the United States of America. 
  
 Guarantees. As applied to the Borrower and its Subsidiaries, all guarantees, endorsements or other contingent or
surety obligations with respect to obligations of others whether or not reflected on the consolidated balance sheet of the Borrower and its Subsidiaries, including any obligation to furnish funds, directly or indirectly (whether by virtue of
partnership arrangements, by agreement to keep-well or otherwise), through the purchase of goods, supplies or services, or by way of stock purchase, capital contribution, advance or loan, or to enter into a contract for any of the foregoing, for the
purpose of payment of obligations of any other person or entity. 
  
 Indebtedness. As applied to the Borrower and its Subsidiaries, (i) all obligations for borrowed money or other extensions of credit whether or not secured or unsecured, absolute or contingent, including, without limitation, unmatured
reimbursement obligations with respect to letters of credit or guarantees issued for the account of or on behalf of the Borrower and its Subsidiaries and all obligations representing the deferred purchase price of property, other than accounts
payable arising in the ordinary course of business, (ii) all obligations evidenced by bonds, notes, debentures or other similar instruments, (iii) all obligations secured by any mortgage, pledge, security interest or other lien on property owned or
acquired by the Borrower or any of its Subsidiaries whether or not the obligations secured thereby shall have been assumed, (iv) that portion of all obligations arising under Capitalized Leases that is required to be capitalized on the consolidated
balance sheet of the Borrower and its Subsidiaries, (v) all Guarantees, and (vi) all obligations that are immediately due and payable out of the proceeds of or production from property now or hereafter owned or acquired by the Borrower or any of its
Subsidiaries. 
  
 Lender. See Preamble. 
  
 Leverage Ratio. For any Reference Period, the ratio of Funded Debt to
EBITDA. 
  
 Loan Documents. This Agreement, each Note, the
Security Documents, and each other document executed and delivered by Borrower to Lender in connection with the Loans. 
  
 Loans. See Section 2.1. 

 Note. Each promissory note of the Borrower, substantially in the form of Exhibit A-1 and Exhibit
A-2 hereto, evidencing the obligation of the Borrower to the Lender to repay a Loan. 
  
 Obligations. Any and all obligations of the Borrower to the Lender of every kind and description, direct or indirect, absolute or contingent, primary or secondary, due or to become due, now existing or
hereafter arising, regardless of how they arise or by what agreement or instrument, if any, and including obligations to perform acts and refrain from taking action as well as obligations to pay money. 
  
 OFAC. The United States Office of Foreign Assets Control. 

 
 Patriot Act. The Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT ACT) Act of 2001, as the same may be amended from time to time, and corresponding provisions of future laws. 
  
 Patriot Act Offense. Any violation of the criminal laws of the United States of America or of any of the several
states, or that would be a criminal violation if committed within the jurisdiction of the United States of America or any of the several states, relating to terrorism or the laundering of monetary instruments, including any offense under (a) the
criminal laws against terrorism; (b) the criminal laws against money laundering, (c) the Bank Secrecy Act, as amended, (d) the Money Laundering Control Act of 1986, as amended, or (e) the Patriot Act. “Patriot Act Offense” also includes
the crimes of conspiracy to commit, or aiding and abetting another to commit, a Patriot Act Offense. 
  
 PBGC. The Pension Benefit Guaranty Corporation or any entity succeeding to any or all of its functions under ERISA. 
  
 Permitted Exceptions. (a) the liens existing on the date hereof set
forth on Exhibit G hereof; (b) Purchase Money Liens; (c) statutory liens of landlords and liens of carriers, warehousemen, mechanics, materialmen and other like liens imposed bylaw, created in the ordinary course of business and for amounts not yet
due (or which are being contested in good faith, by appropriate proceedings or other appropriate actions which are sufficient to prevent imminent foreclosure of such liens) and with respect to which adequate reserves or other appropriate provisions
are being maintained by the Borrower in accordance with GAAP; (d) deposits made (and the liens thereon) in the ordinary course of business of the Borrower (including, without limitation, security deposits for leases, indemnity bonds, surety bonds
and appeal bonds) in connection with workers’ compensation, unemployment insurance and other types of social security benefits or to secure the performance of tenders, bids, contracts (other than for the repayment or guarantee of borrowed money
or purchase money obligations), statutory obligations and other similar obligations arising as a result of progress payments under government contracts; (e) easements (including, without limitation, reciprocal easement agreements and utility
agreements), encroachments, minor defects or irregularities in title, variation and other restrictions, charges or encumbrances (whether or not recorded) affecting the Property (as such tennis defined in the Security Instrument), if applicable, and
which in the aggregate (A) do not materially interfere with the occupation, use or enjoyment by the Borrower 

 
in its business of the Property so encumbered and (B) in the reasonable business judgment of Lender, do not materially and adversely affect the value of such
Property; and (f) liens granted to Lender by the Borrower; (g) tax liens which are not yet due and payable or which are being diligently contested in good faith by the Borrower by appropriate proceedings, and which liens are not (x) filed on any
public records, (y) senior to the liens of Lender, or (z) for Taxes due the United States of America or any state thereof having similar priority statutes; (h) liens and encumbrances and other title exceptions noted on the title insurance policies
for the Property delivered to and accepted by Lender on the date hereof; and (i) liens securing Capitalized Leases, provided that (A) each lien securing such Capitalized Leases shall attach only to the property being leased, (B) a description
of the assets being leased is furnished to Lender, and (C) the debt incurred in connection with such Capitalized Leases shall not exceed, in the aggregate, $1,000,000.00 in any calendar year. 
  
 Person. Any individual or Entity. 
  
 Plan. At any time, an employee pension or other benefit plan that is
subject to Title IV of ERISA or subject to the minimum funding standards under Section 412 of the Code and is either (i) maintained by the Borrower or any member of the Controlled Group for employees of the Borrower or any member of the Controlled
Group or (ii) if such Plan is established, maintained pursuant to a collective bargaining agreement or any other arrangement under which more than one employer makes contributions and to which the Borrower or any member of the Controlled Group is
then making or accruing an obligation to make contributions or has within the preceding five Plan years made contributions. 
  
 Purchase Money Liens. Liens on any item of Equipment acquired after the date of this Agreement provided that (a) each such lien shall attach only
to the property to be acquired, (b) a description of the Equipment so acquired is furnished to Lender, and (c) the debt incurred in connection with such acquisitions shall not exceed, in the aggregate, $300,000.00 in any calendar year.

  
 Real Property Security Instrument. Each
mortgage, deed of trust, or deed to secure debt, as the case may be, made by Borrower for the benefit of Lender, substantially in the form of Exhibit B-I and Exhibit B-2 hereto. 
  
 Reference Period. As of any date of determination, the period of four (4) consecutive fiscal quarters of the Borrower
and its Subsidiaries ending on such date, or if such date is not a fiscal quarter end date, the period of four (4) consecutive fiscal quarters most recently ended (in each case treated as a single accounting period). 
  
 Revolving Facility. The loan facility established pursuant to
that certain Financing Agreement dated as of July 16, 2003 by and between The CIT Group/Business Credit, Inc., and Borrower, and any modification, extension, refinancing or replacement of said loan facility. 
  
 Security Documents. Each Real Property Security Instrument.

  
 Subsidiary. Any Entity of which 50% or more of the
ordinary Voting Power for the election of a majority of the members of the board of directors or other governing body of such 

 
Entity is held or controlled by the Borrower or a Subsidiary of the Borrower; or any other such Entity the management of which is directly or indirectly
controlled by the Borrower or a Subsidiary of the Borrower through the exercise of Voting Power or otherwise; or any joint venture, whether incorporated or not, in which the Borrower has a 50% ownership interest. 
  
 Support Obligations. All recourse Indebtedness with respect to leases
and third party financing arrangements pertaining to the Borrower’s products and related matters. 
  
 Taxes. All federal, state, municipal and other governmental taxes, levies, charges, claims and assessments which are or may be due by the Borrower
with respect to its business, operations, Collateral or otherwise. 
  
 UCC. The Uniform Commercial Code as in effect from time to time in the state of New York. 
  
 Voting Power. means, with respect to any Voting Stock of any Entity at any time, the number of votes entitled to vote generally in the election of
directors of such Entity that are attributable to such Voting Stock at such time divided by the number of votes entitled to vote generally in the election of directors of such Entity that are attributable to all shares of Capital Stock of such
Entity (including such Voting Stock) at such time. 
  
 Voting
Stock. Capital Stock issued by a corporation, or equivalent interests in any other Entity, the holders of which are ordinarily, in the absence of contingencies, entitled to vote for the election of directors (or persons performing similar
functions) of such Entity, even if the right so to vote has been suspended by the happening of such a contingency. 
  
 1.2 Accounting Terms. All terms of an accounting character shall have the meanings assigned thereto by GAAP applied on a basis consistent with the
financial statements referred to in Section 4.6 of this Agreement, modified to the extent, but only to the extent, that such meanings are specifically modified herein. 
  
 SECTION II 
 DESCRIPTION OF CREDIT 
  
 2.1 The Loans.
Subject to the terms and conditions hereof, the Lender will make loans to Borrower in the amounts and on the terms set forth in the Notes (the “Loans”). 
  
 2.2 The Notes. The Loans shall be evidenced by and payable in accordance with the terms of the Notes. The Notes shall
be dated the date hereof and shall have the blanks therein appropriately completed. 
  
 SECTION III 
 CONDITIONS OF LOANS 
  
 3.1 Conditions Precedent to Loans. The obligation of the Lender to make the Loans is subject to the condition
precedent that the Lender shall have received, in form and substance satisfactory to the Lender and its counsel, the following: 
  
 (a) this Agreement, the Notes, the Security Documents and the other Loan Documents, duly executed by the Borrower; 

 (b) a certificate of the Secretary or an Assistant Secretary (or equivalent officer) of the Borrower with
respect to resolutions of the Board of Directors (or equivalent governing body) authorizing the execution and delivery of this Agreement, the Notes, the Security Documents and the other Loan Documents and identifying the officer(s) authorized to
execute, deliver and take all other actions required under this Agreement, and providing specimen signatures of such officers; 
  
 (c) the certificate of incorporation, articles of organization, or other substantially similar formative documents of the Borrower and all amendments and
supplements thereto, filed in the office of the Secretary of State of New York, each certified by said Secretary of State as being a true and correct copy thereof; 
  
 (d) the bylaws, operating agreement, or other substantially similar governance document of the Borrower and all amendments
and supplements thereto, certified by the Secretary or an Assistant Secretary (or equivalent officer) as being a true and correct copy thereof; 
  
 (e) a certificate of the Secretary of State of New York, as to the Borrower’s legal existence and good standing in such state and listing all
documents on file in the office of said Secretary of State and a certificate of the Secretary of State of each of Massachusetts and Minnesota with respect to the qualification and good standing of Borrower as a foreign corporation in such state;

  
 (f) documentary evidence acceptable to Lender as to the tax
good standing of Borrower as a corporation in New York and as a foreign corporation in each of Massachusetts and Minnesota; 
  
 (g) opinions of counsel addressed to Lender from counsel to the Borrower, substantially in the form of Exhibit F hereto; 
  
 (h) appraisals of the Collateral; 
  
 (i) documentary evidence of compliance by the Collateral with all zoning,
environmental and other applicable laws, such evidence shall include, without limitation, a recent environmental audit of the property encumbered by the Real Property Security Instruments; 
  
 (j) documentary evidence of the insurance coverage required pursuant to the
Loan Documents; 
  
 (k) lien searches deemed appropriate by
Lender’s counsel; 

 (l) proforma title policies insuring the liens of the Real Property Security Instruments together with
escrow instructions binding the title insurer to issue a title insurance policy in such form; 
  
 (m) surveys of the property encumbered by the Real Property Security Instruments; 
  
 (n) such other documents, and completion of such other matters, as counsel for the Lender may deem necessary or appropriate; 
  
 (o) payment of an administrative fee equal to one percent (1.00%) of the
aggregate principal amount of the Loans; and 
  
 (p) payment of
all expenses incurred by Lender in connection with the closing of the Loans (the $100,000.00 deposit heretofore made by Borrower to Lender shall be applied towards such expenses). 
  
 SECTION IV 
 REPRESENTATIONS AND WARRANTIES 
  
 In order to
induce the Lender to enter into this Agreement and to make Loans hereunder, the Borrower represents and warrants to the Lender that: 
  
 4.1 Organization and Qualification. Each of the Borrower and its Subsidiaries (a) is duly organized, validly existing and in good standing under
the laws of its jurisdiction of organization, (b) has all requisite power to own its property and conduct its business as now conducted and as presently contemplated and (c) is duly qualified and in good standing and is duly authorized to do
business in each jurisdiction where the nature of its properties or business requires such qualification, except where the failure to be so qualified does not have a material adverse effect on the properties or business of the Borrower and its
Subsidiaries taken as a whole. 
  
 4.2 Authority. The
execution, delivery and performance of this Agreement, the Note, the Security Documents, and the other Loan Documents and the transactions contemplated hereby are within the power and authority of the Borrower and have been authorized by all
necessary corporate proceedings, and do not and will not (a) require any consent or approval of the stockholders, members, or other holders of Capital Stock of the Borrower, (b) contravene any provision of the charter documents or by-laws of the
Borrower or any law, rule or regulation applicable to the Borrower, (c) contravene any provision of; or constitute an event of default or event that, but for the requirement that time elapse or notice be given, or both, would constitute an event of
default under, any other agreement, instrument, order or undertaking binding on the Borrower, or (d) result in or require the imposition of any Encumbrance on any of the properties, assets or rights of the Borrower except for the Encumbrances in
favor of Lender created by the Security Documents. 
  
 4.3
Valid Obligations. This Agreement, the Note, the Security Documents, and the other Loan Documents and all of their respective terms and provisions are the legal, valid and 

 
binding obligations of the Borrower, enforceable in accordance with their respective terms except as limited by bankruptcy, insolvency, reorganization,
moratorium or other laws affecting the enforcement of creditors’ rights generally, and except as the remedy of specific performance or of injunctive relief is subject to the discretion of the court before which any proceeding therefor may be
brought. 
  
 4.4 Consents or Approvals. The execution,
delivery and performance of this Agreement, the Note, the Security Documents, and the other Loan Documents and the transactions contemplated herein do not require any approval or consent of, or filing or registration with, any governmental or other
agency or authority, or any other party (except for the filing of UCC-l financing statements and the recording of the Security Documents). 
  
 4.5 Title to Properties; Absence of Encumbrances. Each of the Borrower and its Subsidiaries has good and marketable title to all of the
properties, assets and rights of every name and nature now purported to be owned by it, including, without limitation, such properties, assets and rights as are reflected in the financial statements referred to in Section 4.6 (except such
properties, assets or rights as have been disposed of in the ordinary course of business since the date thereof), free from all defects of title that might materially adversely affect such properties, assets or rights, taken as a whole. The
Collateral is free from all Encumbrances other than Permitted Exceptions. 
  
 4.6 Financial Statements. The Borrower has furnished the Lender its consolidated balance sheet as of December 31, 2003 and its consolidated statements of operations, changes in stockholders’ equity and
cash flow for the fiscal year then ended, and related footnotes, audited and certified by KPMG LLP. The Borrower has also furnished the Lender its consolidated balance sheet as of March 27, 2004 and its consolidated statement of operations for the
fiscal period then ended, certified by the principal financial officer of the Borrower but subject, however, to normal, recurring year-end adjustments that shall not in the aggregate be material in amount. All such financial statements were prepared
in accordance with GAAP applied on a consistent basis throughout the periods specified and present fairly in all material respects the financial position of the Borrower and its Subsidiaries as of such dates and the results of the operations of the
Borrower and its Subsidiaries for such periods. Except as otherwise disclosed to Lender in writing, there are no liabilities, contingent or otherwise, not disclosed in such financial statements or the notes thereto that involve a material amount.

  
 4.7 Changes. Since the date of the most recent
financial statements referred to in Section 4.6, there have been no changes in the assets, liabilities, financial condition, business or prospects of the Borrower or any of its Subsidiaries other than changes in the ordinary course of business, the
effect of which has not, in the aggregate, been materially adverse. 
  
 4.8 Defaults. As of the date of this Agreement, no Default or Event of Default exists. 
  
 4.9 Taxes. The Borrower and each Subsidiary have filed all federal, state and other tax returns required to be filed, and all taxes, assessments
and other governmental charges due from the Borrower and each Subsidiary have been fully paid. The Borrower and each Subsidiary have established on their books reserves adequate for the payment of all federal, state and other tax liabilities.

 4.10 Litigation. Except as set forth on Exhibit C hereto, there is no litigation, arbitration,
proceeding or investigation pending, or, to the knowledge of the Borrower’s or any Subsidiary’s officers, threatened, against the Borrower or any Subsidiary that, if adversely determined, could result in a material judgment not fully
covered by insurance, could result in a forfeiture of all or any substantial part of the property of the Borrower or its Subsidiaries, or could otherwise have a material adverse effect on the assets, business or prospects of the Borrower or any
Subsidiary. 
  
 4.11 Use of Proceeds. No portion of
any Loan is to be used for the “purpose of purchasing or carrying” any “margin stock” as such terms are used in Regulations U and X of the Board of Governors of the Federal Reserve System, 12 C.F.R. 221 and 224, as amended. The
proceeds of the Loans shall be used solely for the legal purposes set forth in Borrower’s application to Lender for the Loans. 
  
 4.12 Subsidiaries. As of the date of this Agreement, all the Subsidiaries of the Borrower are listed on Exhibit D hereto. The Borrower or a
Subsidiary of the Borrower is the owner, free and clear of all liens and encumbrances, of all of the issued and outstanding Capital Stock of each Subsidiary. All shares of such Capital Stock have been validly issued and are fully paid and
nonassessable, and no rights to subscribe to any additional shares have been granted, and no options, warrants or similar rights are outstanding. 
  
 4.13 Investment Company Act. Neither the Borrower nor any of its Subsidiaries is subject to regulation under the Investment Company Act of
1940, as amended. 
  
 4.14 Compliance with ERISA. The
Borrower and each member of the Controlled Group have fulfilled their obligations under the minimum funding standards of ERISA and the Code with respect to each Plan and are in compliance in all material respects with the applicable provisions of
ERISA and the Code, and have not incurred any liability to the PBGC or a Plan under Title IV of ERISA; and no “prohibited transaction” or “reportable event” (as such terms are defined in ERISA) has occurred with respect to any
Plan. 
  
 4.15 Burdensome Obligations. Neither the Borrower
nor any of its Subsidiaries is a party to or bound by any franchise, agreement, deed, lease or other instrument, or subject to any charter, by-law or other restriction which is so unusual or burdensome that it may materially and adversely affect or
impair the business or condition, financial or otherwise, of the Borrower and its Subsidiaries taken as a whole. The Borrower does not presently anticipate that future expenditures needed to meet the provisions of federal or state statutes, orders,
rules or regulations will be so burdensome as to affect or impair in a materially adverse manner the business or condition, financial or otherwise of the Borrower and its Subsidiaries taken as a whole. Neither the Borrower nor any of its
Subsidiaries has any obligation of any kind (whether fixed, accrued, contingent, unmatured or otherwise) which may have a material adverse effect on the business or condition, financial or otherwise, of the Borrower and its Subsidiaries taken as a
whole. 

 4.16 Labor Matters. Neither the Borrower nor any of its Subsidiaries has experienced any strike,
labor dispute, slowdown or work stoppage due to labor disagreements which would have a materially adverse effect on the Borrower’s and its Subsidiary’s business or condition taken as a whole, financial or otherwise, and, to the best
knowledge of the Borrower, there is no such strike, dispute, slowdown or work stoppage threatened against the Borrower or any of its Subsidiaries. 
  
 4.17 Intellectual Property. Borrower has sufficient rights to, and does not infringe upon the rights of any other Person with respect to,
sufficient patents, copyrights, trademarks, and licenses for such intellectual property as is necessary to carry on its business operations and own, lease and use its assets. 
  
 4.18 Solvency. Borrower is and shall at closing be solvent and able to pay its debts as they become due and possesses
and shall possess sufficient capital to operate its business and own its assets. Borrower shall not be rendered insolvent by the execution, delivery and performance of its obligations under this Agreement and the other Loan Documents nor by the
completion of the transactions contemplated thereby. 
  
 4.19
Security Interest. Upon the proper filing of the Real Property Security Jnstruments with the appropriate county recorder’s offices and the proper filing of financing statements in the appropriate secretary of states’ offices (which
proper filing shall include, without limitation, the payment of all required filing fees and recording taxes), the security interest created in favor of the Lender under the Security Documents shall constitute a first priority perfected security
interest in the Collateral referred to therein subject to no other security interest of any other Person except for Permitted Exceptions. 
  
 4.20 Perfection Certificate. All information set forth on the certificate entitled “Perfection Certificate” (the “Perfection
Certificate”), if such certificate has been requested by the Lender, pertaining to the Borrower is accurate and complete, and there has been no change in any of such information since the date on which the Perfection Certificate was signed by
the Borrower. 
  
 4.21 Patriot Act Representations.
Neither the Borrower nor any Affiliates of the Borrower (a) is listed on any Government Lists, (b) is a person who has been determined by competent authority to be subject to the prohibitions contained in Presidential Executive Order No. 13224
(Sept. 23, 2001) or any other similar prohibitions contained in the rules and regulations of OFAC or in any enabling legislation or other Presidential Executive Orders in respect thereof, (c) has been previously indicted for or convicted of any
felony involving a crime or crimes of moral turpitude or for any Patriot Act Offense, or (d) is not currently under investigation by any governmental authority for alleged criminal activity. 

 SECTION V 
 AFFIRMATIVE COVENANTS 
  
 So long as any Loan or other Obligation remains outstanding, the Borrower covenants as follows: 
  
 5.1 Financial Statements and other Reporting Requirements. The Borrower shall furnish to the Lender: 
  
 (a) as soon as practicable, but in any event not later than one hundred five
(105) days after the end of each fiscal year of the Borrower (provided, however, that if such document is required to be delivered to the Securities and Exchange Commission prior to such date such document shall be provided to Lender promptly after
delivery thereof to the Securities and Exchange Commission), the consolidated balance sheet of the Borrowers and their Subsidiaries, and the consolidating balance sheet of the Borrowers and their Subsidiaries each as at the end of such year, and the
related consolidated statement of income and consolidated statement of cash flow and, upon the Lender’s request, the consolidating statement of income and consolidating statement of cash flow for such year, each setting forth in comparative
form the figures for the previous fiscal year, and all such consolidated and consolidating statements to be in reasonable detail, prepared in accordance with GAAP, and certified (with respect to the consolidated financial statements only) without
qualification and without an expression of uncertainty as to the ability of each of the Borrowers or any of their Subsidiaries to continue as going concerns, by independent certified public accountants satisfactory to the Lender (it being understood
that to the extent the Borrowers’ Form 10-K filed with the Securities and Exchange Commission within such 105 day period contains all of the foregoing information, the Borrowers’ providing a copy of such Form 10-K and any document
incorporated therein by reference to the Lender shall be sufficient); 
  
 (b) as soon as practicable, but in any event not later than sixty (60) days after the end of each of the fiscal quarters of the Borrower (provided, however, that if such document is required to be delivered to the Securities and Exchange
Commission prior to such date, such document shall be provided to Lender promptly after delivery thereof to the Securities and Exchange Commission), copies of the unaudited consolidated balance sheet of the Borrowers and their Subsidiaries and, upon
Lender’s request, the unaudited consolidating balance sheet of the Borrowers and their Subsidiaries, each as at the end of such quarter, and the related consolidated statement of income and consolidated statement of cash flow and, upon the
Lender’s request, consolidating statement of income and cash flow for the portion of the Borrowers’ fiscal year then elapsed, and including a comparison to the projections of the annual operating budget of the Borrowers and their
Subsidiaries all in reasonable detail and prepared in accordance with GAAP (it being understood that to the extent the Borrowers’ Form 10-Q filed with the Securities and Exchange Commission within such 60 day period contains all of the
foregoing information, the Borrowers’ providing a copy of such form I0-Q to the Lender shall be sufficient); 
  
 (c) concurrently with the delivery of each financial statement pursuant to subsections (a) and (b) of this Section 5.1, a report in substantially the form
of Exhibit B hereto signed on behalf of the Borrower by its chief financial officer; 
  
 (d) Intentionally deleted; 
  
 (e)
promptly after the same are available, copies of all proxy statements, financial statements and reports as the Borrower shall send to its stockholders or as the Borrower may file 

 
with the Securities and Exchange Commission or any governmental authority at any time having jurisdiction over the Borrower or its Subsidiaries; 

 
 (f) if and when the Borrower gives or is required to give notice to the
PBGC of any “Reportable Event” (as defined in Section 4043 of ERISA) with respect to any Plan that might constitute grounds for a termination of such Plan under Title IV of ERISA, or knows that any member of the Controlled Group or the
plan administrator of any Plan has given or is required to give notice of any such Reportable Event, a copy of the notice of such Reportable Event given or required to be given to the PBGC; 
  
 (g) immediately upon becoming aware of the existence of any condition or
event that constitutes a Default, written notice thereof specifying the nature and duration thereof and the action being or proposed to be taken with respect thereto; 
  
 (h) promptly upon becoming aware of any litigation or of any investigative proceedings by a Governmental Authority commenced
or threatened against the Borrower or any of its Subsidiaries of which it has notice, the outcome of which would or might have a materially adverse effect on the assets, business or prospects of the Borrower or the Borrower and its Subsidiaries on a
consolidated basis, written notice thereof and the action being or proposed to be taken with respect thereto; 
  
 (i) from time to time, such other financial data and information about the Borrower or its Subsidiaries as the Lender may reasonably request. 

 
 5.2 Conduct of Business. Each of the Borrower and its
Subsidiaries shall: 
  
 (a) duly observe and comply in all
material respects with all applicable laws and valid requirements of any Governmental Authorities relative to its existence, rights and franchises, to the conduct of its business (including, without limitation, all applicable provisions of the
federal Fair Labor Standards Act, as amended) and to its property and assets (including without limitation all environmental laws and ERISA), and shall maintain and keep in full force and effect all licenses and permits necessary in any material
respect to the proper conduct of its business, and preserve, protect, maintain and defend all material trademarks, trade names, copyrights, patents, licenses, and rights in any thereof, in each case free of any claims or infringements; 

 
 (b) maintain its existence; and 
  
 (c) remain engaged substantially in the business in which it is presently
engaged. 
  
 5.3 Maintenance and Insurance. Each of the
Borrower and its Subsidiaries shall maintain the Collateral and its other properties in good repair, working order and condition as required for the normal conduct of its business. Each of the Borrower and its Subsidiaries shall at all times
maintain liability and casualty insurance as required in accordance with the terms of the Security Documents. 

 5.4 Taxes. The Borrower shall pay or cause to be paid all taxes, assessments or governmental
charges on or against it or any of its Subsidiaries or its or their properties on or prior to the time when they become due; provided that this covenant shall not apply to any tax, assessment or charge that is being contested in good faith by
appropriate proceedings and with respect to which adequate reserves have been established and are being maintained in accordance with generally accepted accounting principles if no lien shall have been filed to secure such tax, assessment or
charges. 
  
 5.5 Inspection by the Lender. The Borrower
shall permit the Lender or its designees, at any reasonable time, and upon reasonable notice (or if a Default shall have occurred and is continuing, at any time and without prior notice), to (i) visit and inspect the properties of the Borrower and
its Subsidiaries, (ii) examine and make copies of and take abstracts from the books and records of the Borrower and its Subsidiaries, and (iii) discuss the affairs, finances and accounts of the Borrower and its Subsidiaries with their appropriate
officers, employees and accountants. In handling such information the Lender shall exercise the same degree of care that it exercises with respect to its own proprietary information of the same types to maintain the confidentiality of any non-public
information thereby received or received pursuant to subsections 5.1(a), (b), or (c) except that disclosure of such information may be made (i) to the Subsidiaries or Affiliates of the Lender in connection with their present or prospective business
relations with the Borrower, (ii) to prospective transferees or purchasers of an interest in the Loans, (iii) as required bylaw, regulation, rule or order, subpoena, judicial order or similar order and (iv) as may be required in connection with the
examination, audit or similar investigation of the Lender. 
  
 5.6
Maintenance of Books and Records. Borrower shall keep adequate books and records of account, in which true and complete entries will be made reflecting in all material respects all of its business and financial transactions, and such
entries will be made in accordance with GAAP consistently applied and applicable law. Borrower shall maintain duplicate copies of all such books and records (i) on-site at all times, and (ii) off-site updated on a monthly basis. 
  
 5.7 Further Assurances. At any time and from time to time the Borrower
shall, and shall cause each of its Subsidiaries to, execute and deliver such further instruments and take such further action as may reasonably be requested by the Lender to affect the purposes of this Agreement and the Notes. 
  
 5.8 Patriot Act Compliance. Borrower will use its good faith and
commercially reasonable efforts to comply with the Patriot Act and all applicable requirements of governmental authorities having jurisdiction of the Borrower and the Collateral, including those relating to money laundering and terrorism. The Lender
shall have the right to audit the Borrower’s compliance with the Patriot Act and all applicable requirements of governmental authorities having jurisdiction of the Borrower and the Collateral, including those relating to money laundering and
terrorism. In the event that the Borrower fails to comply with the Patriot Act or any such requirements of governmental authorities, then the Lender may, at its option, cause the Borrower to comply therewith and any and all reasonable costs and
expenses incurred by the Lender in connection therewith shall be secured by the Security Documents and the other Loan Documents and shall be immediately due and payable. 

 5.9 Fixed Charge Coverage Ratio. The Borrower will not permit the Fixed Charge Coverage
Ratio as determined for any Reference Period, to be less than 1.Ito 1.0 to June 30, 2005, and 1.2 to 1.0 thereafter. 
  
 5.10 Leverage Ratio. The Borrower will not permit the Leverage Ratio as determined for any Reference Period, to be greater than 5.00 to 1.00.

  
 SECTION VI 
 NEGATIVE COVENANTS 
  
 So long as any Loan or other Obligation remains outstanding, the Borrower covenants as follows: 
  
 6.1 Encumbrances. Neither the Borrower nor any of its Subsidiaries
shall create, incur, assume or suffer to exist any mortgage, pledge, security interest, lien or other charge or encumbrance, including the lien or retained security title of a conditional vendor (“Encumbrances”), upon or with respect to
any Collateral except for Permitted Exceptions. 
  
 6.2 Name;
Type of Organization; Merger; Consolidation; Acquisitions; Sale or Lease of Assets. The Borrower shall not, without providing at least thirty (30) days prior written notice to the Lender, change its name or place of
business. The Borrower shall not change its type of organization, jurisdiction of organization or other legal structure. Neither the Borrower nor any of its Subsidiaries shall sell, lease or otherwise dispose of any material portion of their
consolidated assets or properties other than in the ordinary course of business, or liquidate, merge or consolidate into or with any other Person, or make any Acquisition, unless (i) Borrower shall have provided Lender with prior written notice and
details concerning each such action, and (ii) no material adverse change in the financial condition of Borrower would result from such action; provided that any Subsidiary of the Borrower may merge or consolidate into or with (x) the Borrower if no
Default has occurred and is continuing or would result from such merger and if the Borrower is the surviving company, or (y) any other wholly-owned Subsidiary of the Borrower; and, provided further, that the Borrower and its Subsidiaries may make
Acquisitions so long as the aggregate consideration paid does not exceed $1,000,000.00 in any fiscal year. Borrower shall not sell, lease or otherwise dispose of any Collateral, except as expressly permitted by the Security Documents. 
  
 6.3 ERISA. Neither the Borrower nor any member of the Controlled Group
shall permit any Plan maintained by it to (i) engage in any “prohibited transaction” (as defined in Section 4975 of the Code, (ii) incur any “accumulated funding deficiency” (as defined in Section 302 of ERISA) whether or not
waived, or (iii) terminate any Plan in a manner that could result in the imposition of a lien or encumbrance on the assets of the Borrower or any of its Subsidiaries pursuant to Section 4068 of ERISA. 

 SECTION VII 
 DEFAULTS 
  
 7.1 Events
of Default. There shall be an Event of Default hereunder if any of the following events occurs: 
  
 (a) the Borrower shall fail to pay on or prior to the fifth (5th ) day following the date when due (i) any amount of principal of any Loans, or (ii) any amount of interest thereon or any fees or expenses payable hereunder, under the Notes, the Security Documents,
or under any of the other Loan Documents; or 
  
 (b) The Borrower
shall fail to perform any term, covenant or agreement contained in Section 5.1 or any Financial Covenant; or 
  
 (c) the Borrower shall fail to perform any covenant contained in Section 5.2, and such failure shall continue for ten 10 days; or 
  
 (d) the Borrower shall fail to perform any term, covenant or agreement (other
than in respect of subsections 7.1(a) through (c) hereof) contained in this Agreement and such default shall continue for 30 days after notice thereof has been sent to the Borrower by the Lender; or 
  
 (e) any representation or warranty of the Borrower made in this Agreement,
the Notes, the Security Documents or any other Loan Documents or in any certificate delivered hereunder shall prove to have been false in any material respect upon the date when made or deemed to have been made; or 
  
 (f) Intentionally deleted; or 
  
 (g) the Borrower or any of its Subsidiaries shall fail to pay at maturity, or
within any applicable period of grace, any obligations in excess of $250,000.00 in the aggregate for borrowed monies or advances, or for the use of real or personal property, or fail to observe or perform any term, covenant or agreement evidencing
or securing such obligations for borrowed monies or advances, or relating to such use of real or personal property, the result of which failure is to permit the holder or holders of such Indebtedness to cause such Indebtedness to become due prior to
its stated maturity upon delivery of required notice, if any; or 
  
 (h) the Borrower or any of its Subsidiaries shall (i) apply for or consent to the appointment of, or the taking of possession by, a receiver, custodian, trustee, liquidator or similar official of itself or of all or a substantial part of
its property, (ii) be generally not paying its debts as such debts become due, (iii) make a general assignment for the benefit of its creditors, (iv) commence a voluntary case under any law relating to bankruptcy, (v) take any action or commence any
case or proceeding under any law relating to bankruptcy, insolvency, reorganization, winding-up or composition or adjustment of debts, or any other law providing for the relief of debtors, (vi) fail to contest in a timely or appropriate manner, or
acquiesce in writing to, any petition filed against it in an involuntary case under any laws relating to bankruptcy, (vii) take any action under the laws of its jurisdiction of incorporation or organization similar to any of the foregoing, or (viii)
take any action for the purpose of effecting any of the foregoing; or 

 (i) a proceeding or case shall be commenced, without the application or consent of the Borrower or any of
its Subsidiaries in any court of competent jurisdiction, seeking (i) the liquidation, reorganization, dissolution, winding up, or composition or readjustment of its debts, (ii) the appointment of a trustee, receiver, custodian, liquidator or the
like of it or of all or any substantial part of its assets, or (iii) similar relief in respect of it, under any law relating to bankruptcy, insolvency, reorganization, winding-up or composition or adjustment of debts or any other law providing for
the relief of debtors, and such proceeding or case shall continue undismissed, or unstayed and in effect, for a period of thirty (30) days; or an order for relief shall be entered in an involuntary case under any law relating to bankruptcy, against
the Borrower or such Subsidiary; or action under the laws of the jurisdiction of incorporation or organization of the Borrower or any of its Subsidiaries similar to any of the foregoing shall be taken with respect to the Borrower or such Subsidiary
and shall continue unstayed and in effect for any period of thirty (30) days; or 
  
 (j) here shall remain in force, undischarged and unsatisfied for more than sixty (60) days, whether or not consecutive, without a stay of execution, any judgment against any Borrower or any of its Subsidiaries that,
with other outstanding final judgments, undischarged, against any Borrower or any of their Subsidiaries exceeds in the aggregate $250,000.00; or 
  
 (k) the Borrower or any member of the Controlled Group shall fail to pay when due an amount or amounts aggregating in excess of $250,000.00 that it shall
have become liable to pay to the PBGC or to a Plan under Title IV of ERISA; or notice of intent to terminate a Plan or Plans shall be filed under Title IV of ERISA by the Borrower, any member of the Controlled Group, any plan administrator or any
combination of the foregoing; or the PBGC shall institute proceedings under Title IV of ERISA to terminate or to cause a trustee to be appointed to administer any such Plan or Plans or a proceeding shall be instituted by a fiduciary of any such Plan
or Plans against the Borrower and such proceedings shall not have been dismissed within thirty (30) days thereafter; or a condition shall exist by reason of which the PBGC would be entitled to obtain a decree adjudicating that any such Plan or Plans
must be terminated; or 
  
 (l) if any Loan Document is invalidated
or declared null and void or otherwise ceases to be in full force and effect; or 
  
 (m) if the proceeds of any Loan are used other than in accordance with the representations and covenants set forth in Section 4.11; or 
  
 (n) if at any time the Lender’s security interest in the Collateral is impaired or invalidated or does not constitute a
first priority perfected security interest, except for Permitted Exceptions; or 
  
 (o) if any license, permit or qualification material to the business of the Borrower and its Subsidiaries, on a consolidated basis, is terminated, cancelled or invalidated; or 
  
 (p) if the validity or enforceability of any Loan Document is contested by
Borrower or if the Borrower denies liability thereunder; or 

 (q) if the Borrower shall default in the observance or performance of any other obligation owed to the
Lender, other than the Obligations, and such default shall continue beyond the expiration of any applicable grace period therefore; or 
  
 (r) any Change of Control shall have occurred; or 
  
 (s) any “Event of Default”, as such term is defined in each Real Property Security Instrument, shall occur; [or] 
  
 (t) any “Event of Default”, as such term is defined under the
documents governing the Revolving Facility, shall occur. 
  
 7.2
Remedies. Upon the occurrence of an Event of Default described in subsections 
  
 7.1(h) or (i), immediately and automatically, and upon the occurrence of any other Event of Default, at any time thereafter while such Event of Default is continuing, at the Lender’s option and upon the
Lender’s declaration: 
  
 (a) the unpaid principal amount of
the Loans together with accrued interest and all other Obligations shall become immediately due and payable without presentment, demand, protest or further notice of any kind, all of which are hereby expressly waived; and 
  
 (b) the Lender may exercise any and all rights it has under this Agreement,
the Notes, the Security Documents or any other documents or agreements executed in connection herewith, or at law or in equity, and proceed to protect and enforce the Lender’s rights by any action at law, in equity or other appropriate
proceeding. 
  
 SECTION VIII 
 MISCELLANEOUS 
  
 8.1 Notices. All notices or other written communications hereunder shall be deemed to have been properly given (i) upon delivery, if delivered in
person or by facsimile transmission with receipt acknowledged by the recipient thereof and confirmed by telephone by sender, (ii) one (1) Business Day after having been deposited for overnight delivery with any reputable overnight courier service,
or (iii) three (3) Business Days after having been deposited in any post office or mail depository regularly maintained by the U.S. Postal Service and sent by registered or certified mail, postage prepaid, return receipt requested, addressed as
follows: 
  

			
	 If to Borrower:
	  	Cybex International, Inc.
	 	  	10 Trotter Drive
	 	  	Medway, Massachusetts 11779
	 	  	Attention: Chief Financial Officer Facsimile No.: 507-455-8552
		
	 With a copy to:
	  	Archer & Greiner
	 	  	One Centennial Square
	 	  	Haddonfield, New Jersey
	 	  	Attention: James H. Carll, Esq.
	 	  	Facsimile No.: 856-519-0574

							
	 	 	 If to Lender:
	  	GMAC Commercial Finance LLC	  	 
	 	 	 	  	210 Interstate North Parkway, Suite 315	  	 
	 	 	 	  	Atlanta, Georgia 30339	  	 
	 	 	 	  	Attention: Divisional Counsel	  	 
	 	 	 	  	Facsimile No.: 678-553-2707	  	 
				
	 	 	 With a copy to:
	  	Thacher Proffitt & Wood LLP	  	 
	 	 	 	  	50 Main Street, Suite 525	  	 
	 	 	 	  	White Plains, New York 10606	  	 
	 	 	 	  	Attention: Thomas J. Infurna, Esq.	  	 
	 	 	 	  	Facsimile No.: 914-421-4150	  	 

  
 or addressed as such party may from
time to time designate by written notice to the other parties. 
  
 Any party by
notice to the others may designate additional or different addresses for subsequent notices or communications. 
  
 8.2 Expenses. The Borrower will pay on demand all expenses of the Lender in connection with the preparation, waiver or amendment of this Agreement,
the Notes, the Security Documents, or other documents executed in connection therewith, or the administration, default or collection of the Loans or other Obligations or administration, default, collection in connection with the Lender’s
exercise, preservation or enforcement of any of its rights, remedies or options thereunder, including, without limitation, fees of outside legal counsel or the allocated costs of in-house legal counsel, accounting, consulting, brokerage or other
similar professional fees or expenses, and any fees or expenses associated with any travel or other costs relating to any appraisals or examinations conducted in connection with the Obligations or any collateral therefor, and the amount of all such
expenses shall, until paid, bear interest at the rate applicable to principal under the Notes (including any default rate). 
  
 8.3 Set-Off. Regardless of the adequacy of any collateral or other means of obtaining repayment of the Obligations, any deposits, balances or other
sums credited by or due from the head office of the Lender or any of its branch offices to the Borrower may, at any time and from time to time after the occurrence of an Event of Default hereunder, without notice to the Borrower or compliance with
any other condition precedent now or hereafter imposed by statute, rule of law, or otherwise (all of which are hereby expressly waived) be set off, appropriated, and applied by the Lender against any and all obligations of the Borrower to the Lender
or any of its Affiliates in such manner as the head office of the Lender or any of its branch offices in their sole discretion may determine, and the Borrower hereby grants the Lender a continuing security interest in such deposits, balances or
other sums for the payment and performance of all such obligations. 
  
 8.4 Term of Agreement. This Agreement shall continue in full force and effect so long any Loan or any Obligation shall be outstanding. 

 8.5 No Waivers. No failure or delay by the Lender in exercising any right, power or privilege
hereunder or under the Notes, the Security Documents and the other Loan Documents or under any other documents or agreements executed in connection herewith shall operate as a waiver thereof; nor shall any single or partial exercise thereof preclude
any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein, in the Notes, the Security Documents and the other Loan Documents provided are cumulative and not exclusive of any rights
or remedies otherwise provided by agreement or law. 
  
 8.6
Governing Law; Consent to Jurisdiction. THIS AGREEMENT AND, EXCEPT TO THE EXTENT PROVIDED THEREIN, THE OTHER LOAN DOCUMENTS, SHALL BE GOVERNED AND CONTROLLED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT
TO ANY CONFLICTS OF LAWS PROVISIONS CONTAINED THEREIN) AS TO INTERPRETATION, ENFORCEMENT, VALIDITY, CONSTRUCTION, EFFECT, AND IN ALL OTHER RESPECTS. TO INDUCE LENDER TO ENTER INTO THIS AGREEMENT, BORROWER IRREVOCABLY AGREES THAT, AT LENDER’S
SOLE AND ABSOLUTE ELECTION, ALL LEGAL AND OTHER PROCEEDINGS OF ANY KIND ARISING OUT OF OR RELATED TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE LITIGATED IN COURTS HAVING SITUS IN THE CITY OF NEW YORK, IN THE STATE OF NEW YORK. BORROWER
HEREBY CONSENTS AND SUBMITS TO THE JURISDICTION OF ANY LOCAL, STATE OR FEDERAL COURTS LOCATED WITHIN SAID CITY AND STATE. BORROWER HEREBY WAIVES ANY RIGHT IT MAY HAVE TO TRANSFER OR CHANGE THE VENUE OF ANY LEGAL OR OTHER PROCEEDING BROUGHT AGAINST
SUCH PERSON BY LENDER IN ACCORDANCE WITH THIS SECTION. 
  
 8.7
Indemnity. The Borrower will (i) indemnify and hold harmless the Lender and each of its officers, directors, employees, Affiliates, agents and controlling persons (each an “Indemnified Party”) from and against any and all losses,
claims, damages and liabilities to which any such Indemnified Party may become subject arising out of or in connection with any claim, litigation, investigation or proceeding relating to the Loans (including the use of the proceeds thereof), the
Loan Documents, or any related transaction, whether or not any Indemnified Party is a party thereto, and (ii) reimburse each Indemnified Party upon demand for all legal and other expenses incurred in connection with investigating or defending any of
the foregoing, except, in each case, losses, claims, damages, liabilities or related expenses to the extent arising from the willful misconduct or gross negligence or the applicable Indemnified Party. 
  
 8.8 Amendments. Neither this Agreement, the Notes, the Security
Documents, any other Loan Documents, nor any provision hereof or thereof may be amended, waived, discharged or terminated except by a written instrument signed by the Lender and, in the case of amendments, by the Borrower. 
  
 8.9 Binding Effect of Agreement. This Agreement shall be binding upon
and inure to the benefit of the Borrower and the Lender and their respective successors and assigns; provided that the Borrower may not assign or transfer its rights or obligations hereunder. The Lender may sell, transfer or grant participations in
this Agreement, the Note, the Security Documents and the other Loan Documents without the prior written consent of the Borrower. 

 8.10 Counterparts. This Agreement may be signed in any number of counterparts with the same effect
as if the signatures hereto and thereto were upon the same instrument. 
  
 8.11 Partial Invalidity. The invalidity or unenforceability of any one or more phrases, clauses or sections of this Agreement shall not affect the validity or enforceability of the remaining portions of it. 
  
 8.12 Captions. The captions and headings of the various sections and
subsections of this Agreement are provided for convenience only and shall not be construed to modify the meaning of such sections or subsections. 
  
 8.13 WAIVER OF JURY TRIAL. THE LENDER AND THE BORROWER AGREE THAT NEITHER OF THEM NOR ANY ASSIGNEE OR SUCCESSOR
SHALL (A) SEEK A JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM OR ANY OTHER ACTION BASED UPON, OR ARISING OUT OF, THIS AGREEMENT, ANY RELATED INSTRUMENTS, ANY COLLATERAL OR THE DEALINGS OR THE RELATIONSHIP BETWEEN OR AMONG ANY OF THEM, OR (B)
SEEK TO CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY DISCUSSED BY THE LENDER AND THE BORROWER, AND THESE PROVISIONS SHALL BE SUBJECT TO NO
EXCEPTIONS. NEITHER THE LENDER NOR THE BORROWER HAS AGREED WITH OR REPRESENTED TO THE OTHER THAT THE PROVISIONS OF THIS PARAGRAPH WILL NOT BE FULLY ENFORCED IN ALL INSTANCES. 
  
 8.14 Waiver of Counterclaim. Borrower hereby waives the right to assert a counterclaim, other than a mandatory or
compulsory counterclaim, in any action or proceeding brought against it by Lender arising out of or in any way connected with this Agreement, the Note, the Security Documents, any other Loan Documents or the Obligations. 
  
 8.15 Entire Agreement. This Agreement, the Note, the Security
Documents, and the other Loan Documents constitute the final agreement of the parties hereto and supersede any prior agreement or understanding, written or oral, with respect to the matters contained herein and therein. 
  
 8.16 Liability. If Borrower consists of more than one person, the
obligations and liabilities of each such person hereunder shall be joint and several. 

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

			
	 CYBEX INTERNATIONAL, INC.

		
	By:	 	 /s/ Arthur W. Hicks, Jr.

			
	 Name:
 Title:
	 	 Arthur W. Hicks, Jr.
 Vice President, Chief Financial Officer

  

			
	 GMAC COMMERCIAL FINANCE LLC

		
	By:	 	 /s/ Michael Hampton

			
	 Name:
 Title:
	 	 Michael Hampton
 Vice President

 EXHIBIT A-1 
 Form of Note 

 PROMISSORY NOTE 
  

			
	$11,000,000.00	  	July 13, 2004

  
 For value received,
CYBEX INTERNATIONAL, INC., a corporation organized under the laws of the State of New York with an address at 10 Trotter Drive, Medway, Massachusetts 11779 (together with its permitted successors and assigns “Borrower”), hereby promises to
pay to the order of UMAC COMMERCIAL FINANCE LLC, a Delaware limited liability company having an office at 210 Interstate North Parkway, Suite 315, Atlanta, Georgia 30339 (together with its successors and/or assigns “Lender”), the principal
sum of ELEVEN MILLION AND 00/100 DOLLARS ($11,000,000.00), together with interest thereon at the rate and in the manner described below in this promissory note (this “Note”) as well as all other amounts now or hereafter owing by Borrower
to Lender that are described in the Credit Agreement (as defined below) and the other Loan Documents (as defined below). 
  
 The unpaid principal balance of this Note shall bear interest from the date hereof until paid in full at the lesser of the Applicable Interest Rate
(defined below) or the highest rate permitted by applicable law. Interest shall be computed on the basis of a 360 day year and paid for the actual number of days elapsed. 
  
 ARTICLE 1 
 DEFINED TERMS 
  
 As used in this Note, except as
otherwise expressly required or unless the context clearly indicates a contrary intent, each of the following terms shall have the meaning given below: 
  
 “Adjustable Rate” shall have the meaning given in Article 3. 
  
 “Adjustment Date” shall mean the first day
of any Interest Period. 
  
 “Applicable
Interest Rate” shall mean, on any day, the non-default rate of interest in effect pursuant to the terms of this Note. 
  
 “Business Day” shall mean any day excluding Saturday, Sunday or any other day on which Lender or national banks in
Atlanta, Georgia, or New York, New York are not open for business. 
  
 “Collateral” shall have the meaning given in Article 6. 
  
 “Credit Agreement” shall have the meaning given in Article 6. 
  
 “Default Rate” shall have the meaning given
in Article 4. 
  
 “Eurodollar
Rate” shall mean, with respect to any Interest Period, an interest rate per annum equal to LIBOR plus 5.00%. 

 “Event of Default” shall have the meaning given in the Credit Agreement.

  
 “Foreign Taxes” shall mean
any present or future income, stamp or other taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now or hereafter imposed, levied, collected, withheld or assessed by any Governmental Authority excluding, in the case of Lender
or any successor and/or assign of Lender, net income and franchise taxes imposed on such entity. 
  
 “Governing Law State” shall mean the State of New York. 
  
 “Governmental Authority” shall mean any court, board, agency, commission, office or
authority of any nature whatsoever for any governmental unit (federal, state, county, district, municipal, city or otherwise) whether now or hereafter in existence. 
  
 “Initial Adjustable Rate” shall mean an interest rate per annum equal to 6.4919%.

  
 “Interest Period” with
respect to any Payment Date, shall mean the period commencing on the immediately preceding Payment Date through and including the day immediately preceding the current Payment Date, provided the first Interest Period shall commence on the date
hereof, and the last Interest Period shall end on the date which immediately precedes the Loan Maturity Date. 
  
 “Liabilities” shall have the meaning given in Article 5. 
  
 “LIBOR” shall mean, with respect to each Interest Period, the rate per annum equal to the
quotient of(a) the rate set forth as the London Interbank Offered Rate (LIBOR) for a one month period, as published in the “Money Rates” column (or any successor column thereto) of the Wall Street Journal in New York City two (2) Working
Days prior to the first day of such Interest Period (or if the Wall Street Journal in New York City is not published on such date, the next succeeding date on which the Wail Street Journal In New York City is published), subject to modification in
the event that Lender shall determine that such rate, as published, was incorrect due to a typographical or similar error (in the event that (i) the Wall Street Journal in New York City ceases publication or no longer publishes one month LIBOR
rates, the Lender, in its sole discretion, shall select an alternative, comparable publication to determine LIBOR) divided by (b) a number equal to 1.00 minus the aggregate (without duplication) of the rates (expressed as a decimal) of reserve
requirements applicable to Lender on the date two (2) Working Days prior to the beginning of such Interest Period (including, without limitation, basic, supplemental, marginal and emergency reserves) under any regulations of any Governmental
Authority as now and from time to time hereafter in effect, dealing with reserve requirements prescribed for eurocurrency funding (currently referred to as “Eurocurrency liabilities” in Regulation D of the Board of Governors of the Federal
Reserve System) maintained by a member bank of such system. 
  
 “Loan” shall mean the principal amount of $11,000,000.00 evidenced by this Note. 

 “Loan Documents” shall have the meaning given in the Credit Agreement.

  
 “Loan Maturity Date” shall
mean August 1, 2009. 
  
 “Loan
Year” shall mean each period of 365 (or 366, in the case of a leap year) consecutive days commencing on the Reference Date. 
  
 “Lockout Period” Not applicable. 
  
 “Monthly Payment” shall mean with respect to each Payment Date a payment of (a) principal
in the sum of $61,111.11 plus (b) accrued interest. 
  
 “Payment Date” shall have the meaning given in Article 3. 
  
 “Prepayment Fee” shall mean a fee equal to the principal amount of the Loan being prepaid multiplied by a percentage
equal to 5.00% during the first Loan Year, 4.00% during the second Loan Year, 1.50% during the third Loan Year, 0.50% during the fourth Loan Year, and 0.00% during the fifth Loan Year. 
  
 “Prime Indexed Rate” shall mean, on a
particular date, the sum of (i) 2.00% and (ii) the Prime Rate. The Prime Indexed Rate shall change automatically, without notice, contemporaneously with any change in the Prime Rate. 
  
 “Prime Rate” shall mean, on a particular date, the annual rate of interest publicly
announced by Citibank, N.A. in New York, New York, as its base rate, as such rate shall change from time to time. If Citibank, N.A. ceases to announce a base rate, Prime Rate shall mean the rate of interest published in The Wall Street
Journal from time to time as die “Prime Rate”. If more than one “Prime Rate” is published in The Wall Street Journal for a day, the average of such “Prime Rates” shall be used, and such average shall
be rounded up to the nearest one-eighth of one percent (0.125%). If The Wall Street Journal ceases to publish the “Prime Rate”, Lender shall select an equivalent publication that publishes such “Prime Rate”, and if such
“Prime Rates” arc no longer generally published or are limited, regulated or administered by a governmental or quasi governmental body, then Lender shall select, in its reasonable discretion, a comparable interest rate index. 

 
 “Reference Date” shall have the meaning
given in Article 3. 
  
 “Security
Documents” shall have the meaning given in the Credit Agreement. 
  
 “Working Day” shall mean any day on which dealings in foreign currencies and exchange are earned on in London, England, Atlanta, Georgia and in New York, New York. 
  
 ARTICLE 2 
 LOAN 
  
 On the date of this Note, Lender shall make the Loan, which is evidenced by this Note. 

 ARTICLE 3 
 INTEREST RATE, PAYMENTS 
  
 (a) The unpaid principal balance of this Note shall bear interest at the Adjustable Rate (defined below). On the first (1st) day of September, 2004, and on the first (1fl) day of each calendar month thereafter, to and
including the 1~ day of July, 2009, (each such day a “Payment Date”), Borrower shall pay to Lender the applicable Monthly Payment. Each Monthly Payment shall be applied in the manner hereinafter set forth in this Note. On the Loan Maturity
Date, the then unpaid principal balance and accrued and unpaid interest thereon and all other sums unpaid under this Note and the other Loan Documents shall be due and payable. Notwithstanding the foregoing, Borrower shall pay in advance on the date
of this Note, and Lender shall apply when due, if this Note is not dated the first (1st) day of a month, interest
due on the Reference Date (defined below). “Reference Date” means the date of this Note, if it is the first (1st) day of a month, or otherwise the first (1st) day of the next succeeding month. 
  
 (b) (i) The “Adjustable Rate” shall mean: (A) from and
including the date of this Note to but excluding the first Adjustment Date following die date of this Note, the Initial Adjustable Rate; and (B) from and including the first Adjustment Date following the date of this Note and for each successive
Interest Period through and including the Interest Period ending on the date immediately preceding the Loan Maturity Date, an interest rate per annum equal to (I) the Eurodollar Rate or (II) if this Note begins bearing interest at the Prime Indexed
Rate in accordance with the provisions of Section (c) below, the Prime Indexed Rate. 
  
 (ii) Any change in the rate of interest hereunder due to a change in the Adjustable Rate shall become effective as of the opening of
business on the first day on which such change in the Adjustable Rate shall become effective. Each determination by Lender of the Adjustable Rate shall be conclusive and binding for all purposes, absent manifest error. 
  
 (c) (i) In the event that Lender shall have determined (which determination
shall be conclusive and binding upon Borrower, absent manifest error) that by reason of circumstances affecting the interbank eurodollar market, adequate and reasonable means do not exist for ascertaining LIBOR, then Lender shall forthwith give
notice by telephone of such determination, confirmed in writing, to Borrower at least one (1) Business Day prior to the last day of the related interest Period. If such notice is given, the Loan shall bear interest at the Prime Indexed Rate
beginning on the first day of the next succeeding Interest Period. 
  
 (ii) If, pursuant to the terms of this Section (c), this Note is bearing interest at the Prime Indexed Rate and Lender shall determine (which determination shall be conclusive and binding upon Borrower absent manifest
error) that the event(s) or circumstance(s) which resulted in such conversion shall no longer be applicable, Lender shall give notice thereof to Borrower by telephone of such determination, confirmed in writing, to Borrower as soon as reasonably
practical, but in no event later than one (1) Business Day prior to the last day of the then current Interest Period. If such notice is given, this Note shall bear interest at the Eurodollar Rate beginning on Abe first day of the next succeeding
interest Period. Notwithstanding any 

 
provision of this Note to the contrary, in no event shall Borrower have the right to elect to have this Note bear interest at either the Eurodollar Rate or
the Prime Indexed Rate. 
  
 (d) If this Note is bearing interest
at the Eurodollar Rate, all payments made by Borrower hereunder shall be made free and clear of, and without reduction for or on account of, Foreign Taxes. If any non-excluded Foreign Taxes are required to be withheld from any amounts payable to
Lender hereunder, the amounts so payable to Lender shall be increased to the extent necessary to yield to Lender (after payment of all non-excluded Foreign Taxes) interest or any such other amounts payable hereunder at the rate or in the amounts
specified hereunder. Whenever any non-excluded Foreign Tax is payable pursuant to applicable law by Borrower, Borrower shall send to Lender an original official receipt showing payment of such non-excluded Foreign Tax. Borrower hereby indemnifies
Lender for any incremental taxes, interest or penalties that may become payable by Lender which may result from any failure by Borrower to pay any such non-excluded Foreign Tax when due to the appropriate taxing authority or any failure by Borrower
to remit to Lender the required receipts or other required documentary evidence, provided, however, in the event that Lender or any successor and/or assign of Lender is not incorporated under the laws of the United States of America or a state
thereof Lender agrees that, prior to the first date on which any payment is due such entity hereunder, it will deliver to Borrower (i) two duly completed copies of United States Internal Revenue Service Form 1001 or 4224 or successor applicable
form, as the case may be, certifying in each case that such entity is entitled to receive payments under this Note, without deduction or withholding of any United States federal income taxes, and (ii) an Internal Revenue Service Form W-8 or W-9 or
successor applicable form, as the case may be, to establish an exemption from United States backup withholding tax. Each entity required to deliver to Borrower a Form 1001 or 4224 and Form W-8 or W-9 pursuant to the preceding sentence further
undertakes to deliver to Borrower two further copies of the said letter and Form 1001 or 4224 and Form W-8 or W-9, or successor applicable forms, or other manner of certification, as the case may be, on or before the date that any such letter or
form expires (which, in the case of the Form 4224, is the last day of each U.S. taxable year of the non-U.S. entity) or becomes obsolete or after the occurrence of any event requiring a change in the most recent letter and form previously delivered
by it to Borrower, and such other extensions or renewals thereof as may reasonably be requested by Borrower, certifying in the case of a Form 1001 or 4224 that such entity is entitled to receive payments under this Note without deduction or
withholding of any United States federal income taxes, unless in any such case an event (including, without limitation, any change in treaty, law or regulation) has occurred prior to the date on which any such delivery would otherwise be required
which renders all such forms inapplicable or which would prevent such entity from duly completing and delivering any such letter or form with respect to it and such entity advises Borrower that it is not capable of receiving payments without any
deduction or withholding of United States federal income tax, and in the case of a Form W-8 or W-9, establishing an exemption from United States backup withholding tax. Notwithstanding the foregoing, if such entity fails to provide a duly completed
Form 1001 or 4224 or other applicable form and, under applicable law, in order to avoid liability for Foreign Taxes, Borrower is required to withhold on payments made to such entity that has failed to provide the applicable form, Borrower shall be
entitled to withhold the appropriate amount of Foreign Taxes. In such event, Borrower shall promptly provide to such entity evidence of payment of such Foreign Taxes to the appropriate taxing authority and shall promptly forward to such entity any
official 

 
tax receipts or other documentation with respect to the payment of the Foreign Taxes as may be issued by the taxing authority. 
  
 (e) If any requirement of law or any change therein or in the interpretation
or application thereof, shall hereafter make it unlawful for Lender in good faith to maintain the Loan bearing interest at the Eurodollar Rate, (I) the obligation of Lender hereunder to maintain the Loan bearing interest at the Eurodollar Rate shall
be canceled forthwith and (II) the Loan shall automatically bear interest at the Prime Indexed Rate on the next succeeding Payment Date or within such earlier period as required by law. Borrower hereby agrees promptly to pay Lender (within ten (10)
days of Lender’s written demand therefor), any additional amounts necessary to compensate Lender for any reasonable costs incurred by Lender in making any conversion in accordance with this Note, including, without limitation, any interest or
fees payable by Lender to lenders of funds obtained by it in order to make or maintain the Loan hereunder. Upon written demand from Borrower, Lender shall demonstrate in reasonable detail the circumstances giving rise to Lender’s determination
and the calculation substantiating the Prime Indexed Rate and any additional costs incurred by Lender in making the conversion. Lender’s written notice of such costs, as certified to Borrower, shall be conclusive absent manifest error.

  
 (f) In the event that any change in any requirement of law or
in the interpretation or application thereof, or compliance in good faith by Lender with any request or directive (whether or not having the force of law) hereafter issued from any central bank or other Governmental Authority: 
  

	 	(I)	shall hereafter impose, modify or hold applicable any reserve, special deposit, compulsory loan or similar requirement against assets held by, or deposits or other liabilities in or
for the account of, advances or loans by, or other credit extended by, or any other acquisition of funds by, any office of Lender which is not otherwise included in the determination of LIBOR hereunder; 

  

	 	(II)	shall, in connection with a LIBOR based loan hereafter have the effect of reducing the rate of return on Lender’s capital as a consequence of its obligations hereunder to a
level below that which Lender could have achieved but for such adoption, change or compliance (taking into consideration Lender’s policies with respect to capital adequacy) by any amount deemed by Lender to be material; or

  

	 	(III)	shall, in connection with a LIBOR based loan hereafter impose on Lender any other condition, the result of which is to increase the cost to Lender of making, renewing or maintaining
loans or extensions of credit or to reduce any amount receivable hereunder; 

  
 then, in any such case, Borrower shall promptly pay Lender (within ten (10) days of Lender’s written demand therefor), any additional amounts necessary to compensate Lender for such additional cost or reduced
amount receivable which Lender deems to be material as reasonably 

 
determined by Lender. If Lender becomes entitled to claim any additional amounts pursuant to this Section (f), Lender shall provide Borrower with written
notice specifying in reasonable detail the event or circumstance by reason of which it has become so entitled and the additional amount required to fully compensate Lender for such additional cost or reduced amount. A certificate as to any
additional costs or amounts payable pursuant to the foregoing sentence submitted by Lender to Borrower shall be conclusive in the absence of manifest error. This provision shall survive payment of this Note and the satisfaction of all other
obligations of Borrower under this Note and the other Loan Documents. 
  
 (g) Borrower agrees to indemnify Lender and to hold Lender harmless from any loss or expense which Lender sustains or incurs as a consequence of (I) any default by Borrower in payment of the principal of or interest on the Loan while
bearing interest at the Eurodollar Rate, including, without limitation, any such loss or expense arising from interest or fees payable by Lender to lenders of funds obtained by it in order to obtain or maintain the Eurodollar Rate, (II) any
prepayment (whether voluntary or mandatory) of the Loan on a day that (A) is not the Payment Date immediately following the last day of an Interest Period with respect thereto or (B) is the Payment Date immediately following the last day of an
Interest Period with respect thereto if Borrower did not give the prior written notice of such prepayment required pursuant to the terms of this Note, including, without limitation, such loss or expense arising from interest or fees payable by
Lender to lenders of funds obtained by it in order to obtain or maintain the Eurodollar Rate hereunder, and (III) the conversion (for any reason whatsoever, whether voluntary or involuntary) of the Applicable Interest Rate from the Eurodollar Rate
to the Prime Indexed Rate with respect to any portion of the outstanding principal amount of the Loan then bearing interest at the Eurodollar Rate on a date other than the Payment Date immediately following the last day of an Interest Period,
including, without limitation, such loss or expenses arising from interest or fees payable by Lender to lenders of funds obtained by it in order to obtain or maintain the Eurodollar Rate hereunder (the amounts referred to in clauses (I), (II) and
(Ill) are herein referred to collectively as the “Breakage Costs”). This provision shall survive payment of this Note in lull and the satisfaction of all other obligations of Borrower under this Note, the Security Documents and the other
Loan Documents. 
  
 ARTICLE 4 
 LATE CHARGES & DEFAULT INTEREST 
  
 Borrower shall pay to Lender a late payment charge of five percent (5.00%) of the amount of any payment that is not paid on or prior to the tenth
(10°’) day after the day when such payment is due under the Credit Agreement, this Note or the other Loan Documents. Such late payment charges represent a reasonable estimate of the additional costs and expenses that will be incurred by
Lender as a result of any late payments from Borrower and shall not be construed to constitute a penalty of any kind. In addition, during the continuance of an Event of Default, Borrower shall pay interest on the unpaid principal sum of this Note at
the lower of the Applicable Interest Rate plus three and one-half percent (3.50%) per annum or the highest rate permitted by applicable law (“Default Rate”). 

 ARTICLES 
 PREPAYMENT 
  
 (a) The
principal of this Note may not be voluntarily prepaid in whole or in part during the Lockout Period. Provided no Event of Default exists and subject to Article 5(b) below, this Note may be voluntarily prepaid in whole but not in part on any Payment
Date subsequent to the Lockout Period, upon not less than thirty (30) days prior written notice to the Lender specifying the date on which prepayment is to be made and upon payment of (i) interest accrued and unpaid on the principal balance of this
Note to and including the date of prepayment, (ii) the entire outstanding principal balance of this Note and all other Liabilities (as defined in Article 5(b) below) due under this Note and the other Loan Documents and (iii) the Prepayment Fee. If
any such notice of prepayment is given, such prepayment shall be due and payable on the date specified in such notice. Lender shall not be obligated to accept any prepayment of the principal balance of this Note unless it is accompanied by the
Prepayment Fee. 
  
 (b) If this Note is accelerated or
involuntarily prepaid due to the occurrence of an Event of Default or otherwise, Borrower shall pay to Lender the outstanding balance of this Note and all other liabilities (including, but not limited to, the Prepayment Fee) described in the Credit
Agreement, tills Note and the other Loan Documents (the “Liabilities”). 
  
 ARTICLE 6 
 MISCELLANEOUS 
  
 It is Borrower’s and Lender’s intent that the interest, fees, charges and other amounts described in this Note and
the other Loan Documents shall be lawful in all respects. If such interest, fees, charges or other amounts are found by a court of competent jurisdiction, in a final determination, to exceed the limit which Lender may lawfully charge Borrower, then
they shall automatically be reduced to such limit and, if any amount in excess of such limit shall have been paid to Lender, such excess amount shall, in Lender’s sole discretion, be applied by Lender against any principal and other
non-interest amounts owing by Borrower or refunded to Borrower. To the greatest extent permitted by applicable law, all interest paid or agreed to be paid by Borrower to Lender shall be amortized, prorated, allocated and spread throughout the
complete term of the Loan so that such actions do not violate any usury statute. 
  
 All amounts received by Lender shall be applied against the amounts owing by Borrower with respect to this Note and the other Loan Documents in the following order: first, to any outstanding attorneys’ and other
fees, charges, and expenses (including, but not limited to, the Prepayment Fee, and any expenses pertaining to the repossession, repair, preparation and advertisement for disposition or foreclosure, appointment of a receiver for, and disposition or
foreclosure of any collateral); second, to any outstanding interest, in arrears; and third, to any outstanding principal. 
  
 All payments shall be made to Lender at the address specified above (or at such other office as may be designated in writing by Lender) in lawful money of
the United States of America not later than 12:00 noon (EST or EDT) on the date due. Whenever the date due for any payment shall fall on a day other than a Business Day, such payment shall be made on the 

 
next Business Day and the amount payable to Lender shall be adjusted for such extension of time. Lender shall be entitled to require all payments to be
remitted via an electronic fund transfer system that is acceptable to Lender in its discretion. 
  
 Notwithstanding the satisfaction in full of this Note and the other Loan Documents, if any payment or other amount applied by Lender against the
indebtedness, liabilities and obligations described in this Note and the other Loan Documents proves to be defeasible or revocable for any reason, the indebtedness, liabilities and obligations satisfied by such payment or other amount shall be
reinstated, payable by Borrower and any other person or entity responsible for the payment thereof, and be secured by any collateral securing the payment and performance of the indebtedness, liabilities and obligations described in this Note and the
other Loan Documents. 
  
 Time is of the essence with respect to
this Note and the other Loan Documents. If any amount is not paid to Lender or any other Event of Default occurs under this Note or the other Loan Documents, Lender may accelerate and declare all of the amounts owing under this Note and the other
Loan Documents immediately due and payable without presentment, demand, notice, protest; or legal process of any kind (provided that in the event of any Event of Default arising from the commencement of a bankruptcy, liquidation, insolvency, or
similar proceeding, the Liabilities shall automatically become immediately due and payable without presentment, demand, notice, protest, or legal process of any kind). Upon the occurrence of any Event of Default, Lender shall be entitled to exercise
any remedies set forth in the Credit Agreement, this Note, the Security Documents and the other Loan Documents or otherwise permitted under applicable law. 
  
 This Note is the Note referred to ill the Credit Agreement between Borrower and Lender dated of even date herewith and any amendments, extensions,
modifications, replacements and substitutions thereto (“Credit Agreement”). All capitalized terms used herein shall be defined as set forth in this Note or, in the absence of a definition in this Note, as set forth in the Credit Agreement
and the other Loan Documents. 
  
 Borrower shall reimburse Lender
for all reasonable attorney’s fees and other amounts described in the Credit Agreement and other Loan Documents incurred in negotiating, documenting, filing, recording, administering, defending, and enforcing Lender’s rights and remedies
under this Note and the other Loan Documents as well as any other charges, expenses and amounts described in this Note and the other Loan Documents or to which Lender may be entitled to collect with respect to the Loan under applicable law. All such
costs, expenses and charges shall be payable by Borrower to Lender on demand, and, if not paid within five (5) Business Days, shall bear interest at the Default Rate until paid. 
  
 All notices and other communications required or permitted with respect to this Note shall be in writing and given in
accordance with the requirements set forth in the Credit Agreement. 
  
 In the event that the Borrower consists of more than one Person, all of Borrower’s indebtedness, liabilities and obligations to Lender described in this Note and the other Loan Documents shall be joint and several in nature.

 This Note is secured by the collateral described in the Security Documents (the “Collateral”).

  
 This Note and the other Loan Documents are freely assignable
by Lender without the consent of Borrower. 
  
 Borrower and all
others who may become liable for the payment of all or any part of the Liabilities severally waive presentment and demand for payment, notice of intent to accelerate and notice of acceleration, notice of dishonor, protest and notice of protest and
non-payment and all other notices of any kind, except for notices expressly provided for in this Note or the other Loan Documents. No release of any security for the Liabilities or extension of time for payment of this Note or any installment of
this Note, and no alteration, amendment or waiver of any provision of this Note or the other Loan Documents made by agreement between Lender or any other person or party shall release, modify, amend, waive, extend, change, discharge, terminate or
affect the liability of Borrower, and any other person or entity who may become liable for the payment of all or any part of the Liabilities, under this Note or the other Loan Documents. No notice to or demand on Borrower shall be deemed to be a
waiver of the obligation of Borrower or of the right of Lender to take further action without further notice or demand as provided for in this Note or the other Loan Documents. If Borrower is a partnership, corporation or limited liability company,
the agreements contained in this Note shall remain in full force and effect, notwithstanding any changes in the individuals or entities comprising the Borrower. The term “Borrower,” as used in this Note, shall include any alternate or
successor entity, but any predecessor entity, and its partners or members, as the case may be, shall not thereby be released from any liability. (Nothing in the foregoing sentence shall be construed as a consent to, or a waiver of, any prohibition
or restriction on transfers of interests in Borrower which may be set forth in the other Loan Documents.) 
  
 All of the terms, covenants and conditions contained in the other Loan Documents are hereby made part of this Note to the same extent and with the same
force as if they were fully set forth in this Note. 
  
 This Note
may not be modified, amended, waived, extended, changed, discharged or terminated orally or by any act or failure to act on the part of Borrower or Lender, but only by an agreement in writing signed by the party against whom enforcement of any
modification, amendment, waiver, extension, change, discharge or termination is sought. 
  
 This Note shall be governed by and construed in accordance with the laws of the Governing Law State without reference to conflicts of law rules. To induce Lender to accept this Note and the other Loan Documents,
Borrower irrevocably agrees that, subject to Lender’s sole and absolute election, all legal and other proceedings of any kind arising out of or related to this Note, the other Loan Documents, the Loan, Borrower, any other Loan Party, their
business operations (including, but not limited to, the Enterprises), or their assets shall be litigated in courts having situs in the Governing Law State. Borrower hereby consents and submits to the jurisdiction of any local, state or federal
courts located within said Governing Law State. 

 
Borrower hereby waives any right it may have to transfer or change the venue of any legal or other proceeding brought against such person by Lender in
accordance with this paragraph. 
  
 BORROWER FIEREBY WAIVES
DEMAND, PRESENTMENT, PROTEST AND NOTICE OF NONPAYMENT, AND FURTHER WAIVES THE BENEFIT OF ALL HOMESTEAD, DOWER, CURTESY, AND REDEMPTION RIGHTS AND ALL VALUATION, APPRAISAL, MORATORIUM, MARSHALING, AND EXEMPTION LAWS TO THE MAXIMUM EXTENT PERMITTED BY
APPLICABLE LAW. 
  
 IN WITNESS WHEREOF, Borrower has duly
executed this Note as of the day and year first above written. 
  

			
	 CYBEX INTERNATIONAL, INC.

		
	 By:
	 	 
	 Name:
	 	 Arthur W. Hicks, Jr.

	 Title:
	 	 Vice President; Chief Financial Officer

 EXHIBIT A-2 
 Form of Note 

					
	 	 	PROMISSORY NOTE	 	 
			
	 $2,000,000.00
	 	 	 	July 13, 2004

  
 For value received,
CYBEX INTERNATIONAL, INC., a corporation organized under the laws of the State of New York with an address at 10 Trotter Drive, Medway, Massachusetts 11779 (together with its permitted successors and assigns “Borrower”), hereby promises to
pay to the order of GMAC COMMERCIAL FINANCE LLC, a Delaware limited liability company having an office at 210 Interstate North Parkway, Suite 315, Atlanta, Georgia 30339 (together with its successors and/or assigns “Lender”), the principal
sum of TWO MILLION AND 00/100 DOLLARS ($2,000,000.00), together with interest thereon at the rate and in the manner described below in this promissory note (this “Note”) as well as all other amounts now or hereafter owing by Borrower to
Lender that are described in the Credit Agreement (as defined below) and the other Loan Documents (as defined below). 
  
 The unpaid principal balance of this Note shall bear interest from the date hereof until paid in full at the lesser of the Applicable Interest Rate
(defined below) or the highest rate permitted by applicable law, Interest shall be computed on the basis of a 360 day year and paid for the actual number of days elapsed. 
  
 ARTICLE 1 
 DEFINED TERMS 
  
 As used in this Note, except as otherwise
expressly required or unless the context clearly indicates a contrary intent, each of the following terms shall have the meaning given below: 
  
 “Adjustable Rate” shall have the meaning given in Article 3. 
  
 “Adjustment Date” shall mean the first day
of any Interest Period. 
  
 “Applicable
Interest Rate” shall mean, on any day, the non-default rate of interest in effect pursuant to the terms of this Note. 
  
 “Business Day” shall mean any day excluding Saturday, Sunday or any other day on which Lender or national banks in
Atlanta, Georgia, or New York, New York are not open for business. 
  
 “Collateral” shall have the meaning given in Article 6. 
  
 “Credit Agreement” shall have the meaning given in Article 6. 
  
 “Default Rate” shall have the meaning given
in Article 4. 
  
 “Eurodollar
Rate” shall mean, with respect to any Interest Period, an interest rate per annum equal to LIBOR plus 5.00%. 

 “Event of Default” shall have the meaning given in the Credit Agreement.

  
 “Foreign Taxes” shall mean
any present or future income, stamp or other taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now or hereafter imposed, levied, collected, withheld or assessed by any Governmental Authority excluding, in the case of Lender
or any successor and/or assign of Lender, net income and franchise taxes imposed on such entity. 
  
 “Governing Law State” shall mean the State of New York. 
  
 “Governmental Authority” shall mean any court, board, agency, commission, office or
authority of any nature whatsoever for any governmental unit (federal, state, county, district, municipal, city or otherwise) whether now or hereafter in existence. 
  
 “Initial Adjustable Rate” shall mean an interest rate per annum equal to 6.49 19%.

  
 “Interest Period” with
respect to any Payment Date, shall mean the period commencing on the immediately preceding Payment Date through and including the day immediately preceding the current Payment Date, provided the first Interest Period shall commence on the date
hereof, and the last Interest Period shall end on the date which immediately precedes the Loan Maturity Date. 
  
 “Liabilities” shall have the meaning given in Article 5. 
  
 “LIBOR” shall mean, with respect to each
Interest Period, the rate per annum equal to the quotient of (a) the rate set forth as the London Interbank Offered Rate (LIBOR) for a one month period, as published in the “Money Rates” column (or any successor column thereto) of the Wall
Street Journal in New York City two (2) Working Days prior to the first day of such Interest Period (or if the Wall Street Journal in New York City is not published on such date, the next succeeding date on which the Wall Street Journal In New York
City is published), subject to modification in the event that Lender shall determine that such rate, as published, was incorrect due to a typographical or similar error (in the event that (i) the Wall Street Journal in New York City ceases
publication or no longer publishes one month LIBOR rates, the Lender, in its sole discretion, shall select an alternative, comparable publication to determine LIBOR) divided by (b) a number equal to 1.00 minus the aggregate (without duplication) of
the rates (expressed as a decimal) of reserve requirements applicable to Lender on the date two (2) Working Days prior to the beginning of such Interest Period (including, without limitation, basic, supplemental, marginal and emergency reserves)
under any regulations of any Governmental Authority as now and from time to time hereafter in effect, dealing with reserve requirements prescribed for eurocurrency funding (currently referred to as “Eurocurrency liabilities” in Regulation
D of the Board of Governors of the Federal Reserve System) maintained by a member bank of such system. 
  
 “Loan” shall mean the principal amount of $2,000,000.00 evidenced by this Note. 

 “Loan Documents” shall have the meaning given in the Credit Agreement.

  
 “Loan Maturity Date” shall
mean August 1,2009. 
  
 “Loan
Year” shall mean each period of 365 (or 366, in the case of a leap year) consecutive days commencing on the Reference Date. 
  
 “Lockout Period” Not applicable. 
  
 “Monthly Payment” shall mean with respect to each Payment Date a payment of (a) principal
in the sum of $33,333.33 plus (b) accrued interest. 
  
 “Payment Date” shall have the meaning given in Article 3. 
  
 “Prepayment Fee” shall mean a fee equal to the principal amount of the Loan being prepaid multiplied by a percentage
equal to 5.00% during the first Loan Year, 4.00% during the second Loan Year, 1.50% during the third Loan Year, 0.50% during the fourth Loan Year, and 0.00% during the fifth Loan Year. 
  
 “Prime Indexed Rate” shall mean, on a particular date, the sum of (i) 2.00% and (ii) the
Prime Rate. The Prime Indexed Rate shall change automatically, without notice, contemporaneously with any change in the Prime Rate. 
  
 “Prime Rate” shall mean, on a particular date, the annual rate of interest publicly announced by Citibank, N.A. in New
York, New York, as its base rate, as such rate shall change from time to time. If Citibank, N.A. ceases to announce a base rate, Prime Rate shall mean the rate of interest published in The Wall Street Journal from time to time as the
“Prime Rate”. If more than one “Prime Rate” is published in The Wall Street Journal for a day, the average of such “Prime Rates” shall be used, and such average shall be rounded up to the nearest one-eighth of
one percent (0.125%). If The Wall Street Journal ceases to publish the “Prime Rate”, Lender shall select an equivalent publication that publishes such “Prime Rate”, and if such “Prime Rates” are no longer
generally published or are limited, regulated or administered by a governmental or quasigovernmental body, then Lender shall select, in its reasonable discretion, a comparable interest rate index. 
  
 “Reference Date” shall have the meaning
given in Article 3. 
  
 “Security
Documents” shall have the meaning given in the Credit Agreement. 
  
 “Working Day” shall mean any day on which dealings in foreign currencies and exchange are carried on in London, England, Atlanta, Georgia and in New York, New York. 

 ARTICLE 2 
 LOAN 
  
 On
the date of this Note, Lender shall make the Loan, which is evidenced by this Note. 
  
 ARTICLE 3 
 INTEREST RATE, PAYMENTS 
  
 (a) The unpaid principal balance of this Note shall bear interest at the
Adjustable Rate (defined below). On the first (1st) day of September, 2004, and on the first (1st) day of each
calendar month thereafter, to and including the 1st day of July, 2009, (each such day a “Payment Date”),
Borrower shall pay to Lender the applicable Monthly Payment. Each Monthly Payment shall be applied in the manner hereinafter set forth in this Note. On the Loan Maturity Date, the then unpaid principal balance and accrued and unpaid interest thereon
and all other sums unpaid under this Note and the other Loan Documents shall be due and payable. Notwithstanding the foregoing, Borrower shall pay in advance on the date of this Note, and Lender shall apply when due, if this Note is not dated the
first (1st) day of a month, interest due on the Reference Date (defined below). “Reference Date” means the
date of this Note, if it is the first (1st) day of a month, or otherwise the first (1st) day of the next succeeding
month. 
  
 (b) (i) The “Adjustable Rate” shall
mean: (A) from and including the date of this Note to but excluding the first Adjustment Date following the date of this Note, the Initial Adjustable Rate; and (B) from and including the first Adjustment Date following the date of this Note and for
each successive Interest Period through and including the Interest Period ending on the date immediately preceding the Loan Maturity Date, an interest rate per annum equal to (I) the Eurodollar Rate or (II) if this Note begins bearing interest at
the Prime Indexed Rate in accordance with the provisions of Section (c) below, the Prime Indexed Rate. 
  
 (ii) Any change in the rate of interest hereunder due to a change in the Adjustable Rate shall become effective as of the opening of
business on the first day on which such change in the Adjustable Rate shall become effective. Each determination by Lender of the Adjustable Rate shall be conclusive and binding for all purposes, absent manifest error. 
  
 (c) (i) In the event that Lender shall have determined (which determination
shall be conclusive and binding upon Borrower, absent manifest error) that by reason of circumstances affecting the interbank eurodollar market, adequate and reasonable means do not exist for ascertaining LIBOR, then Lender shall forthwith give
notice by telephone of such determination, confirmed in writing, to Borrower at least one (1) Business Day prior to the last day of the related Interest Period. If such notice is given, the Loan shall bear interest at the Prime Indexed Rate
beginning on the first day of the next succeeding Interest Period. 
  
 (ii) If, pursuant to the terms of this Section (c), this Note is bearing interest at the Prime Indexed Rate and Lender shall determine (which determination shall be conclusive and binding upon Borrower absent manifest
error) that the event(s) or circumstance(s) which resulted in such conversion shall no longer be applicable, Lender shall give notice thereof to Borrower by 

 
telephone of such determination, confirmed in writing, to Borrower as soon as reasonably practical, but in no event later than one (1) Business Day prior to
the last day of the then current Interest Period. If such notice is given, this Note shall bear interest at the Eurodollar Rate beginning on the first day of the next succeeding Interest Period. Notwithstanding any provision of this Note to the
contrary, in no event shall Borrower have the right to elect to have this Note bear interest at either the Eurodollar Rate or the Prime Indexed Rate. 
  
 (d) If this Note is bearing interest at the Eurodollar Rate, all payments made by Borrower hereunder shall be made free and clear of, and without
reduction for or on account of, Foreign Taxes. If any non-excluded Foreign Taxes are required to be withheld from any amounts payable to Lender hereunder, the amounts so payable to Lender shall be increased to the extent necessary to yield to Lender
(after payment of all non-excluded Foreign Taxes) interest or any such other amounts payable hereunder at the rate or in the amounts specified hereunder. Whenever any non-excluded Foreign Tax is payable pursuant to applicable law by Borrower,
Borrower shall send to Lender an original official receipt showing payment of such non-excluded Foreign Tax. Borrower hereby indemnifies Lender for any incremental taxes, interest or penalties that may become payable by Lender which may result from
any failure by Borrower to pay any such non-excluded Foreign Tax when due to the appropriate taxing authority or any failure by Borrower to remit to Lender the required receipts or other required documentary evidence, provided, however, in the event
that Lender or any successor and/or assign of Lender is not incorporated tinder the laws of the United States of America or a state thereof Lender agrees that, prior to the first date on which any payment is due such entity hereunder; it will
deliver to Borrower (i) two duly completed copies of United States Internal Revenue Service Form 1001 or 4224 or successor applicable form, as the case may be, certifying in each case that such entity is entitled to receive payments under this Note,
without deduction or withholding of any United States federal income taxes, and (ii) an Internal Revenue Service Form W-8 or W-9 or successor applicable form, as the case may be, to establish an exemption from United States backup withholding tax.
Each entity required to deliver to Borrower a Form 1001 or 4224 and Form W-8 or W-9 pursuant to the preceding sentence further undertakes to deliver to Borrower two further copies of the said letter and Form 1001 or 4224 and Form W-8 or W-9, or
successor applicable forms, or other manner of certification, as the case may be, on or before the date that any such letter or form expires (which, in the case of the Form 4224, is the last day of each U.S. taxable year of the non-U.S. entity) or
becomes obsolete or after the occurrence of any event requiring a change in the most recent letter and form previously delivered by it to Borrower, and such other extensions or renewals thereof as may reasonably be requested by Borrower, certifying
in the case of a Form 1001 or 4224 that such entity is entitled to receive payments under this Note without deduction or withholding of any United States federal income taxes, unless in any such case an event (including, without limitation, any
change in treaty, law or regulation) has occurred prior to the date on which any such delivery would otherwise be required which renders all such forms inapplicable or which would prevent such entity from duly completing and delivering any such
letter or form with respect to it and such entity advises Borrower that it is not capable of receiving payments without any deduction or withholding of United States federal income tax, and in the case of a Form W-8 or W-9, establishing an exemption
from United States backup withholding tax. Notwithstanding the foregoing, if such entity fails to provide a duly completed Form 1001 or 4224 or other applicable form and, under applicable law, in order to avoid liability for Foreign Taxes, Borrower
is required to withhold on 

 
payments made to such entity that has failed to provide the applicable form, Borrower shall be entitled to withhold the appropriate amount of Foreign Taxes.
In such event, Borrower shall promptly provide to such entity evidence of payment of such Foreign Taxes to the appropriate taxing authority and shall promptly forward to such entity any official tax receipts or other documentation with respect to
the payment of the Foreign Taxes as may be issued by the taxing authority. 
  
 (e) If any requirement of law or any change therein or in the interpretation or application thereof, shall hereafter make it unlawful for Lender in good faith to maintain the Loan bearing interest at the Eurodollar
Rate, (I) the obligation of Lender hereunder to maintain the Loan bearing interest at the Eurodollar Rate shall be canceled forthwith and (II) the Loan shall automatically bear interest at the Prime Indexed Rate on the next succeeding Payment Date
or within such earlier period as required by law. Borrower hereby agrees promptly to pay Lender (within ten (10) days of Lender’s written demand therefor), any additional amounts necessary to compensate Lender for any reasonable costs incurred
by Lender in making any conversion in accordance with this Note, including, without limitation, any interest or fees payable by Lender to lenders of funds obtained by it in order to make or maintain the Loan hereunder. Upon written demand from
Borrower, Lender shall demonstrate in reasonable detail the circumstances giving rise to Lender’s determination and the calculation substantiating the Prime Indexed Rate and any additional costs incurred by Lender in making the conversion.
Lender’s written notice of such costs, as certified to Borrower, shall be conclusive absent manifest error, 
  
 (f) In the event that any change in any requirement of law or in the interpretation or application thereof, or compliance in good faith by Lender with any
request or directive (whether or not having the force of law) hereafter issued from any central bank or other Governmental Authority: 
  

	 	(I)	shall hereafter impose, modify or hold applicable any reserve, special deposit, compulsory loan or similar requirement against assets held by, or deposits or other liabilities in or
for the account of, advances or loans by, or other credit extended by, or any other acquisition of funds by, any office of Lender which is not otherwise included in the determination of LIBOR hereunder; 

  

	 	(II)	shall, in connection with a LIBOR based loan hereafter have the effect of reducing the rate of return on Lender’s capital as a consequence of its obligations hereunder to a
level below that which Lender could have achieved but for such adoption, change or compliance (taking into consideration Lender’s policies with respect to capital adequacy) by any amount deemed by Lender to be material; or

  

	 	(III)	 shall, in connection with a LIBOR based loan hereafter impose on Lender any other condition, the result of which is to increase the cost to Lender of making,
renewing or maintaining loans or extensions of credit or to reduce any amount receivable hereunder; 

	 	 
then, in any such case, Borrower shall promptly pay Lender (within ten (10) days of Lender’s written demand therefor), any additional amounts necessary
to compensate Lender for such additional cost or reduced amount receivable which Lender deems to be material as reasonably determined by Lender. If Lender becomes entitled to claim any additional amounts pursuant to this Section (1), Lender shall
provide Borrower with written notice specifying in reasonable detail the event or circumstance by reason of which it has become so entitled and the additional amount required to fully compensate Lender for such additional cost or reduced amount. A
certificate as to any additional costs or amounts payable pursuant to the foregoing sentence submitted by Lender to Borrower shall be conclusive in the absence of manifest error. This provision shall survive payment of this Note and the satisfaction
of all other obligations of Borrower under this Note and the other Loan Documents. 

  
 (g) Borrower agrees to indemnify Lender and to hold Lender harmless from any loss or expense which Lender sustains or incurs as a consequence of (I) any
default by Borrower in payment of the principal of or interest on the Loan while bearing interest at the Eurodollar Rate, including, without limitation, any such loss or expense arising from interest or fees payable by Lender to lenders of funds
obtained by it in order to obtain or maintain the Eurodollar Rate, (II) any prepayment (whether voluntary or mandatory) of the Loan on a day that (A) is not the Payment Date immediately following the last day of an Interest Period with respect
thereto or (B) is the Payment Date immediately following the last day of an Interest Period with respect thereto if Borrower did not give the prior written notice of such prepayment required pursuant to the terms of this Note, including, without
limitation, such loss or expense arising from interest or fees payable by Lender to lenders of funds obtained by it in order to obtain or maintain the Eurodollar Rate hereunder, and (III) the conversion (for any reason whatsoever, whether voluntary
or involuntary) of the Applicable Interest Rate from the Eurodollar Rate to the Prime Indexed Rate with respect to any portion of the outstanding principal amount of the Loan then bearing interest at the Eurodollar Rate on a date other than the
Payment Date immediately following the last day of an Interest Period, including, without limitation, such loss or expenses arising from interest or fees payable by Lender to lenders of funds obtained by it in order to obtain or maintain the
Eurodollar Rate hereunder (the amounts referred to in clauses (I), (II) and (III) are herein referred to collectively as the “Breakage Costs”). This provision shall survive payment of this Note in full and the satisfaction of all other
obligations of Borrower under this Note, the Security Documents and the other Loan Documents. 
  
 ARTICLE 4 
 LATE CHARGES & DEFAULT INTEREST 
  
 Borrower shall pay to Lender a late payment charge of five percent (5.00%) of
the amount of any payment that is not paid on or prior to the tenth (10th) day after the day when such payment is
due under the Credit Agreement, this Note or the other Loan Documents. Such late payment charges represent a reasonable estimate of the additional costs and expenses that will be incurred by Lender as a result of any late payments from Borrower and
shall not be construed to constitute a penalty of any kind. In addition, during the continuance of an Event of Default, Borrower shall pay interest on the unpaid principal sum of this Note at the lower of the Applicable Interest Rate plus three and
one-half percent (3.50%) per annum or the highest rate permitted by applicable law (“Default Rate”). 

 ARTICLE 5 
 PREPAYMENT 
  
 (a) The
principal of this Note ‘nay not be voluntarily prepaid in whole or in part during the Lockout Period. Provided no Event of Default exists and subject to Article 5(b) below, this Note may be voluntarily prepaid in whole but not in part on any
Payment Date subsequent to the Lockout Period, upon not less than thirty (30) days prior written notice to the Lender specifying the date on which prepayment is to be made and upon payment of (i) interest accrued and unpaid on the principal balance
of this Note to and including the date of prepayment, (ii) the entire outstanding principal balance of this Note and all other Liabilities (as defined in Article 5(b) below) due under this Note and the other Loan Documents and (iii) the Prepayment
Fee. If any such notice of prepayment is given, such prepayment shall be due and payable on the date specified in such notice. Lender shall not be obligated to accept any prepayment of the principal balance of this Note unless it is accompanied by
the Prepayment Fee. 
  
 (b) If this Note is accelerated or
involuntarily prepaid due to the occurrence of an Event of Default or otherwise, Borrower shall pay to Lender the outstanding balance of this Note and all other liabilities (including, but not limited to, the Prepayment Fee) described in the Credit
Agreement, this Note and the other Loan Documents (the “Liabilities”). 
  
 ARTICLE 6 
 MISCELLANEOUS 
  
 It is Borrower’s and Lender’s intent that the interest, fees, charges and other amounts described in this Note and
the other Loan Documents shall be lawful in all respects. If such interest, fees, charges or other amounts are found by a court of competent jurisdiction, in a final determination, to exceed the limit which Lender may lawfully charge Borrower, then
they shall automatically be reduced to such limit and, if any amount in excess of such limit shall have been paid to Lender, such excess amount shall, in Lender’s sole discretion, be applied by Lender against any principal and other
non-interest amounts owing by Borrower or refunded to Borrower. To the greatest extent permitted by applicable law, all interest paid or agreed to be paid by Borrower to Lender shall be amortized, prorated, allocated and spread throughout the
complete term of the Loan so that such actions do not violate any usury statute. 
  
 All amounts received by Lender shall be applied against the amounts owing by Borrower with respect to this Note and the other Loan Documents in the following order: first, to any outstanding attorneys’ and other
fees, charges, and expenses (including, but not limited to, the Prepayment Fee, and any expenses pertaining to the repossession, repair, preparation and advertisement for disposition or foreclosure, appointment of a receiver for, and disposition or
foreclosure of any collateral); second, to any outstanding interest, in arrears; and third, to any outstanding principal. 
  
 All payments shall be made to Lender at the address specified above (or at such other office as may be designated in writing by Lender) in lawful money of
the United States of America not later than 12:00 noon (EST or EDT) on the date due. Whenever the date due for 

 
any payment shall fall on a day other than a Business Day, such payment shall be made on the next Business Day and the amount payable to Lender shall be
adjusted for such extension of time. Lender shall be entitled to require all payments to be remitted via an electronic fund transfer system that is acceptable to Lender in its discretion. 
  
 Notwithstanding the satisfaction in full of this Note and the other Loan Documents, if any payment or other amount applied
by Lender against the indebtedness, liabilities and obligations described in this Note and the other Loan Documents proves to be defeasible or revocable for any reason, the indebtedness, liabilities and obligations satisfied by such payment or other
amount shall be reinstated, payable by Borrower mid any other person or entity responsible for the payment thereof, and be secured by any collateral securing the payment and performance of the indebtedness, liabilities and obligations described in
this Note and the other Loan Documents. 
  
 Time is of the essence
with respect to this Note and the other Loan Documents. If any amount is not paid to Lender or any other Event of Default occurs under this Note or the other Loan Documents, Lender may accelerate and declare all of the amounts owing under this Note
and the other Loan Documents immediately due and payable without presentment, demand, notice, protest, or legal process of any kind (provided that in the event of any Event of Default arising from the commencement of a bankruptcy, liquidation,
insolvency, or similar proceeding, the Liabilities shall automatically become immediately due and payable without presentment, demand, notice, protest, or legal process of any kind). Upon the occurrence of any Event of Default, Lender shall be
entitled to exercise any remedies set forth in the Credit Agreement, this Note, the Security Documents and the other Loan Documents or otherwise permitted under applicable law. 
  
 This Note is the Note referred to in the Credit Agreement between Borrower and Lender dated of even date herewith and any
amendments, extensions, modifications, replacements and substitutions thereto (“Credit Agreement”). All capitalized terms used herein shall be defined as set forth in this Note or, in the absence of a definition in this Note, as set forth
in the Credit Agreement and the other Loan Documents. 
  
 Borrower
shall reimburse Lender for all reasonable attorney’s fees and other amounts described in the Credit Agreement and other Loan Documents incurred in negotiating, documenting, filing, recording, administering, defending, and enforcing
Lender’s rights and remedies under this Note and the other Loan Documents as well as any other charges, expenses and amounts described in this Note and the other Loan Documents or to which Lender may be entitled to collect with respect to the
Loan under applicable law. All such costs, expenses and charges shall be payable by Borrower to Lender on demand, and, if not paid within five (5) Business Days, shall bear interest at the Default Rate until paid. 
  
 All notices and other communications required or permitted with respect to
this Note shall be in writing and given in accordance with the requirements set forth in the Credit Agreement. 

 In the event that the Borrower consists of more than one Person, all of Borrower’s indebtedness,
liabilities and obligations to Lender described in this Note and the other Loan Documents shall be joint and several in nature. 
  
 This Note is secured by the collateral described in the Security Documents (the “Collateral”): 
  
 This Note and the other Loan Documents are freely assignable by Lender
without the consent of Borrower. 
  
 Borrower and all others who
may become liable for the payment of all or any pail of the Liabilities severally waive presentment and demand for payment, notice of intent to accelerate and notice of acceleration, notice of dishonor, protest and notice of protest and non-payment
and all other notices of any kind, except for notices expressly provided for in this Note or the other Loan Documents. No release of any security for the Liabilities or extension of time for payment of this Note or any installment of this Note, and
no alteration, amendment or waiver of any provision of this Note or the other Loan Documents made by agreement between Lender or any other person or party shall release, modify, amend, waive, extend, change, discharge, terminate or affect the
liability of Borrower, and any other person or entity who may become liable for the payment of all or any part of the Liabilities, under this Note or the other Loan Documents. No notice to or demand on Borrower shall be deemed to be a waiver of the
obligation of Borrower or of the right of Lender to take further action without further notice or demand as provided for in this Note or the other Loan Documents. If Borrower is a partnership, corporation or limited liability company, the agreements
contained in this Note shall remain in full force and effect, notwithstanding any changes in the individuals or entities comprising the Borrower. The term “Borrower,” as used in this Note, shall include any alternate or successor entity,
but any predecessor entity, and its partners or members, as the ease may be, shall not thereby be released from any liability. (Nothing in the foregoing sentence shall be construed as a consent to, or a waiver of, any prohibition or restriction on
transfers of interests in Borrower which may be set forth in the other Loan Documents.) 
  
 All of the terms, covenants and conditions contained in the other Loan Documents are hereby made part of this Note to the same extent and with the same force as if they were fully set forth in this Note. 

 
 This Note may not be modified, amended, waived, extended, changed,
discharged or terminated orally or by any act or failure to act on the pail of Borrower or Lender, but only by an agreement ill writing signed by the party against whom enforcement of any modification, amendment, waiver, extension, change, discharge
or termination is sought. 
  
 This Note shall be governed by and
construed in accordance with the laws of the Governing Law State without reference to conflicts of law rules. To induce Lender to accept this Note and the other Loan Documents, Borrower irrevocably agrees that, subject to Lender’s sole and
absolute election, all legal and other proceedings of any kind arising out of or related to this Note, the other Loan Documents, the Loan, Borrower, any other Loan Party, their business operations (including, but not limited to, the Enterprises), or
their assets shall be litigated in courts having situs in the Governing Law State. Borrower hereby consents and submits to the 

 
jurisdiction of any local, state or federal courts located within said Governing Law State. Borrower hereby waives any right it may have to transfer or
change the venue of any legal or other proceeding brought against such person by Lender in accordance with this paragraph. 
  
 BORROWER HEREBY WAIVES DEMAND, PRESENTMENT, PROTEST AND NOTICE OF NONPAYMENT, AND FURTHER WAIVES THE BENEFIT OF ALL HOMESTEAD, DOWER, CURTESY, AND
REDEMPTION RIGHTS AND ALL VALUATION, APPRAISAL, MORATORIUM, MARSHALING, AND EXEMPTION LAWS TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW. 
  
 IN WITNESS WHEREOF, Borrower has duly executed this Note as of the day and year first above written. 
  

			
	 CYBEX INTERNATIONAL, INC.

		
	 By:
	 	 

			
	 Name:
	 	 Arthur W. Hicks, Jr.

	 Title:
	 	 Vice President; Chief Financial Officer

 EXHIBIT B-1 
 ENCUMBRANCES 
  
 (Form of
Real Property Security Instrument) 

  
 CYBEX INTERNATIONAL, INC., as mortgagor 
 (Borrower) 
  
 to 
  
 GMAC COMMERCIAL FINANCE LLC, as mortgagee 
 (Lender) 
  

  
 MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, 
 SECURITY AGREEMENT, FINANCING STATEMENT 
 AND FIXTURE FILING 
  

  

			
		
	 Dated:
	  	July 13, 2004
		
	 Location:
	  	 10 Trotter Drive
 Medway,
MA

		
	 County:
	  	Norfolk

  
 PREPARED BY AND UPON

 RECORDATION RETURN TO: 
  
 Thacher Proffitt & Wood, LLP 
 50 Main
Street, Suite 525 
 White Plains, New York 10606 
 Attention: Thomas J. Infurna, Esq. 
 File No.: 19601-00108 
  

 THIS MORTGAGE, ASSIGNMENT OF LEASES AND RENTS SECURITY AGREEMENT, FINANCING STATEMENT AND FIXTURE FILING
(the “Security Instrument”) is made as of the 13th day of July, 2004, by CYBEX INTERNATIONAL, INC., a
corporation organized and existing under the laws of the State of New York, with an address at 10 Trotter Drive, Medway, Massachusetts 11779, as mortgagor (“Borrower”) to GMAC COMMERCIAL FINANCE LLC, a Delaware limited liability company,
having an office at 210 Interstate North Parkway, Suite 315, Atlanta, Georgia 30339, as mortgagee (“Lender”). 
  
 RECITALS: 
  
 Borrower by its promissory notes of even date herewith given to Lender (to wit, a note in the principal sum of $11,000,000.00 and a note in the principal
sum of $2,000,000.00) is indebted to Lender in the aggregate principal sum of $13,000,000.00 in lawful money of the United States of America (the notes together with all extensions, renewals, modifications, substitutions and amendments thereof shall
collectively be referred to as the “Note”), with interest from the date thereof at the rates set forth in the Note, principal and interest to be payable in accordance with the terms and conditions provided in the Note, which Note is made
pursuant to the terms of a certain Credit Agreement made by and between Borrower and Lender bearing even date herewith (the credit agreement together with all extensions, renewals, modifications, substitutions and amendments thereof shall
collectively be referred to as the “Credit Agreement”). 
  
 Borrower desires to secure the payment of the Debt (defined in Article 2) and the performance of all of its obligations under the Note and the Other Obligations (defined in Article 2). 
  
 Article 1 - GRANTS OF SECURITY 
  
 Section 1.1 PROPERTY MORTGAGED. Borrower does hereby irrevocably
mortgage, grant, bargain, sell, pledge, assign, warrant, transfer and convey to Lender, and grant a security interest to Lender in, the following property, rights, interests and estates now owned, or hereafter acquired by Borrower (collectively, the
“Property”): 
  
 (a) Land. The real property
described in Exhibit A attached hereto and made a part hereof (the “Land”); 
  
 (b) Additional Land. All additional lands, estates and development rights hereafter acquired by Borrower for use in connection with the Land and the development of the Land and all additional lands and estates
therein which may, from time to time, by supplemental mortgage or otherwise be expressly made subject to the lien of this Security Instrument; 
  
 (c) Improvements. The buildings, structures, fixtures, additions, enlargements, extensions, modifications, repairs, replacements and improvements
now or hereafter erected or located on the Land (the “Improvements”); 
  
 (d) Easements. All easements, rights-of-way or use, rights, strips and gores of land, streets, ways, alleys, passages, sewer rights, water, water courses, water rights and powers, air 

 
rights and development rights, and all estates, rights, titles, interests, privileges, liberties, servitudes, tenements, hereditaments and appurtenances of
any nature whatsoever, in any way now or hereafter belonging, relating or pertaining to the Land and the Improvements and the reversion and reversions, remainder and remainders, and all land lying in the bed of any street, road or avenue, opened or
proposed, in front of or adjoining the Land, to the center line thereof and all the estates, rights, titles, interests, dower and rights of dower, curtesy and rights of curtesy, property, possession, claim and demand whatsoever, both at law and in
equity, of Borrower of, in and to the Land and the Improvements and every part and parcel thereof, with the appurtenances thereto; 
  
 (e) Fixtures and Personal Property. All Equipment (as such term is defined in the Uniform Commercial Code (defined below), including, without
limitation, materials handling equipment, communications equipment, computer equipment, and manufacturing equipment of every kind and nature whatsoever owned by Borrower, or in which Borrower has or shall have an interest (other than Inventory, as
such term is defined in the Uniform Commercial Code)) machinery (other than Inventory, as such term is defined in the Uniform Commercial Code) and fixtures (including, but not limited to, all heating, air conditioning, plumbing, lighting,
communications and elevator fixtures), office furniture, furnishings and trade fixtures, specialty tools and parts (constituting part of the equipment), in each case now or hereafter located upon the Land and the Improvements, or appurtenant
thereto, and all construction building equipment, materials and supplies of any nature whatsoever (expressly excluding any materials and supplies used in the manufacture of Inventory) owned by Borrower, or in which Borrower has or shall have an
interest, now or hereafter located upon the Land and the Improvements, or appurtenant thereto, and accessions thereof and renewals and replacements thereof and substitutions therefor together with Borrower’s interest in, and right to any and
all manuals, computer programs, software, databases and other materials relating to the use, mechanical/physical operation or structure of any of the foregoing (collectively, the “Personal Property”; it being agreed, however, that the term
“Personal Property” shall not include Inventory, Accounts, Deposit Accounts, Documents, General Intangibles (other than as set forth in Section 1.1(m) below), or Investment Property (as such terms are defined in the Uniform Commercial
Code)), including the right, title and interest of Borrower in and to any of the Personal Property which may be subject to any security interests, as defined in the Uniform Commercial Code, as adopted and enacted by the state or states where any of
the Property is located (the “Uniform Commercial Code”), superior in lien to the lien of this Security Instrument and all proceeds and products of all of the above; 
  
 (f) Leases and Rents. All leases, subleases and other agreements affecting the use, enjoyment or occupancy of the
Land and/or the Improvements heretofore or hereafter entered into and all extensions, amendments and modifications thereto (the “Leases”), whether before or after the filing by or against Borrower of any petition for relief under any laws
relating to bankruptcy or rights of creditors generally (“Creditors Rights Laws”) and all right, title and interest of Borrower, its successors and assigns therein and thereunder, including, without limitation, any guaranties of the
lessees’ obligations thereunder, cash or securities deposited thereunder to secure the performance by the lessees of their obligations thereunder and all rents, additional rents, revenues, issues and profits (including all oil and gas or other
mineral royalties and bonuses, but excluding any revenues and profits resulting from Inventory, Accounts, Deposit Accounts, Documents, General Intangibles (other than as set forth in Section 1.1(m) below), or 

 
Investment Property) from the Land and the Improvements whether paid or accruing before or after the filing by or against Borrower of any petition for relief
under Creditors Rights Laws (the “Rents”) and all proceeds from the sale or other disposition of the Leases and all sums paid or payable in consideration of or as a result of the termination of any Leases and the right to receive and apply
the Rents to the payment of the Debt; 
  
 (g) Insurance
Proceeds. All proceeds of and any unearned premiums on any insurance policies covering the Land, the Improvements, the Personal Property and other collateral granted under this Section 1.1, including, without limitation, the right to receive and
apply the proceeds of any insurance, judgments, or settlements made in lieu thereof, for damage to the Property; 
  
 (h) Condemnation Awards. All awards or payments, including interest thereon, which may hereafter be made with respect to the Land, the
Improvements, the Personal Property and other collateral granted under this Section 1.1, whether from the exercise of the right of eminent domain (including, but not limited to any transfer made in lieu of or in anticipation of the exercise of the
right), or for a change of grade, or for any other injury to or decrease in the value of the Property; 
  
 (i) Tax Certiorari. All refunds, rebates or credits hereafter arising in connection with a reduction in real estate taxes and assessments charged
against the Land, the Improvements, the Personal Property and other collateral granted under this Section 1.1 as a result of tax certiorari or any applications or proceedings for reduction; 
  
 (j) Conversion. All proceeds of the conversion, voluntary or
involuntary, of any of the foregoing including, without limitation, proceeds of insurance and condemnation awards, into cash or liquidation claims; 
  
 (k) Rights. The right, in the name and on behalf of Borrower, to appear in and defend any action or proceeding brought with respect to the Property
and to commence any action or proceeding to protect the interest of Lender in the Land, the Improvements, the Personal Property and other collateral granted under this Section 1.1; 
  
 (l) Agreements. All agreements, contracts, certificates, instruments, franchises, permits, licenses, plans,
specifications and other documents, now or hereafter entered into, and all rights therein and thereto, respecting or pertaining to the use, occupation, construction, management or mechanical/physical operation of the Land and any part thereof (but
excluding any such documents relating to Inventory or the conversion of Inventory into finished product, Accounts, Deposit Accounts, Documents, General Intangibles (other than as set forth in Section 1.1(m) below), or Investment Property) and any
Improvements, and all right, title and interest of Borrower therein and thereunder, including, without limitation, the right, upon the occurrence and during the continuance of an Event of Default (defined in Article 10), to receive and collect any
sums payable to Borrower thereunder; 
  
 (m) Intangibles.
All books and records and all other general intangibles relating to or used in connection with the mechanical/physical operation of the Land, the Improvements and the Personal Property (but excluding any general intangibles relating to Inventory or
the 

 
conversion of Inventory into finished product, Accounts, Deposit Accounts, Documents, Investment Property or intellectual property); and 
  
 (n) Other Rights. Any and all other rights of Borrower in and to the
items set forth in Subsections (a) through (m) above. 
  
 Section
1.2 ASSIGNMENT OF LEASES AND RENTS. Borrower hereby absolutely and unconditionally assigns to Lender Borrower’s right, title and interest in and to all current and future Leases and Rents; it being intended by Borrower that this
assignment constitutes a present, absolute assignment and not an assignment for additional security only. Nevertheless, subject to the terms of this Section 1.2 and Section 3.8 and Section 11.1(h), Lender grants to Borrower a revocable license to
collect and receive the Rents. Borrower shall hold a portion of the Rents sufficient to discharge all current sums due on the Debt, for use in the payment of such sums. 
  
 Section 1.3 SECURITY AGREEMENT. This Security Instrument is both a real property mortgage and a “security
agreement” within the meaning of the Uniform Commercial Code. The Property includes both real and personal property and all other rights and interests, whether tangible or intangible in nature, of Borrower in the Property. By executing and
delivering this Security Instrument, Borrower hereby grants to Lender, as security for the Obligations (defined in Section 2.3), a security interest in the Personal Property and other collateral given as security for the Obligations (whether
denominated as part of the Property or otherwise) to the extent that under applicable law the same would be governed by the Uniform Commercial Code (collectively, “UCC Collateral”) to the full extent that the Personal Property and other
UCC Collateral may be subject to the Uniform Commercial Code. 
  
 Section 1.4 PLEDGE OF MONIES HELD. Borrower hereby pledges to Lender any and all monies now or hereafter held by Lender, including, without limitation, Net Proceeds (defined in Section 3.7), as additional security for the Obligations
until expended or applied as provided in this Security Instrument. 
  
 Section 1.5 CONDITIONS TO GRANT. TO HAVE AND TO HOLD the above granted and described Property to the use and benefit of Lender, and the successors and assigns of Lender, forever; 
  
 PROVIDED, HOWEVER, these presents are upon the express condition that, if
Borrower shall pay to Lender the Debt at the time and in the manner provided in the Note and this Security Instrument and shall perform the Other Obligations as set forth in this Security Instrument, these presents and the estate hereby granted
shall cease, terminate and be void. 
  
 Article 2 - DEBT AND
OBLIGATIONS SECURED 
  
 Section 2.1 DEBT. This Security
Instrument and the grants, assignments and transfers made in Article 1 are given for the purpose of securing the payment of the following, in such order of priority as Lender may determine in its sole discretion (the “Debt”): 

 
 (a) the indebtedness evidenced by the Note in lawful money of the United
States of America; 

 (b) interest, default interest, late charges and other sums, as provided in the Note, the Credit
Agreement, this Security Instrument or the Other Security Documents (defined in Section 3.2); 
  
 (c) the Prepayment Fee (as defined in the Note), if any; 
  
 (d) all other monies agreed or provided to be paid by Borrower in the Note, the Credit Agreement, this Security Instrument or the Other Security Documents; 
  
 (e) all sums advanced pursuant to this Security Instrument to protect and preserve the Property and the lien and the
security interest created hereby; and 
  
 (f) all sums advanced
and costs and expenses incurred by Lender in connection with the Debt or any part thereof, any renewal, extension, or change of or substitution for the Debt or any part thereof, or the acquisition or perfection of the security therefor, whether made
or incurred at the request of Borrower or Lender. 
  
 Section 2.2
OTHER OBLIGATIONS. This Security Instrument and the grants, assignments and transfers made in Article 1 are also given for the purpose of securing the performance of the following (the “Other Obligations”): 
  
 (a) all other obligations of Borrower contained herein; 
  
 (b) each obligation of Borrower contained in the Note, the Credit Agreement
and in the Other Security Documents; and 
  
 (c) each obligation
of Borrower contained in any renewal, extension, amendment, modification, consolidation, change of, or substitution or replacement for, all or any part of the Note, the Credit Agreement, this Security Instrument or the Other Security Documents.

  
 Section 2.3 DEBT AND OTHER OBLIGATIONS. Borrower’s
obligations for the payment of the Debt and the performance of the Other Obligations shall be referred to collectively as the “Obligations.” 
  
 Section 2.4 PAYMENTS. Unless payments are made in the required amount in immediately available funds at the place where the Note is payable,
remittances in payment of all or any part of the Debt shall not, regardless of any receipt or credit issued therefor, constitute payment until the required amount is actually received by Lender in funds immediately available at the place where the
Note is payable (or any other place as Lender, in Lender’s sole discretion, may have established by delivery of written notice thereof to Borrower) and shall be made and accepted subject to the condition that any check or draft may be handled
for collection in accordance with the practice of the collecting bank or banks; provided, however, Lender shall not be required to accept payment for any Obligation in cash. Acceptance by Lender of any payment in an amount less than the amount then
due shall be deemed an acceptance on account 

 
only, and the failure to pay the entire amount then due shall be and continue to be an Event of Default. 
  
 Article 3 - BORROWER COVENANTS 
  
 Borrower covenants and agrees that: 
  
 Section 3.1 PAYMENT OF DEBT. Borrower will pay the Debt at the time
and in the manner provided in the Note and in this Security Instrument. 
  
 Section 3.2 INCORPORATION BY REFERENCE. All the covenants, conditions and agreements contained in (a) the Note and the Credit Agreement, and (b) all and any of the documents other than the Note, the Credit Agreement or this Security
Instrument now or hereafter executed and delivered by Borrower and/or others and by or in favor of Lender, which wholly or partially secure or guaranty payment of the Note or are otherwise executed and delivered in connection with the Loan
(hereinafter defined; such other documents, together with any and all extensions, renewals, substitutions, replacements, amendments, modifications and/or restatements thereof, the “Other Security Documents”) are hereby made a part of this
Security Instrument to the same extent and with the same force as if fully set forth herein. 
  
 Section 3.3 INSURANCE. 
  
 (a) Borrower shall obtain and maintain, or cause to be maintained, insurance for Borrower and the Property providing at least the following coverages: 
  

(i) insurance with respect to the Improvements and the Personal Property insuring against any peril now or hereafter included within
the classification “All Risk” or “Special Perils”, in each case (A) in an amount equal to 100% of the “Full Replacement Cost,” which for purposes of this Security Instrument shall mean actual replacement value
(exclusive of costs of excavations, foundations, underground utilities and footings) with a waiver of depreciation; (B) containing an agreed amount endorsement with respect to the Improvements and Personal Property waiving all coinsurance
provisions; (C) providing for no deductible in excess of $10,000.00; and (D) providing coverage for contingent liability from Operation of Building Laws, Demolition Costs and Increased Cost of Construction Endorsements together with an
“Ordinance or Law Coverage” or “Enforcement” endorsement. The Full Replacement Cost shall be redetermined from time to time (but not more frequently than once in any eighteen (18) calendar months) at the request of Lender by an
appraiser or contractor designated and paid by Borrower and approved by Lender, or by an engineer or appraiser in the regular employ of the insurer. After the first appraisal, additional appraisals may be based on construction cost indices
customarily employed in the trade. No omission on the part of Lender to request any such ascertainment shall relieve Borrower of any of its obligations under this Subsection; 
  
 (ii) commercial general liability insurance against all claims for personal injury, bodily injury, death or
property damage occurring upon, in or about the Property, such insurance (A) to be on the so-called “occurrence” form with a general aggregate limit of 

 
not less than $5,000,000 and a per occurrence limit of not less than $2,000,000; (B) to continue at not less than the aforesaid limit until required to be
changed by Lender in writing by reason of changed economic conditions making such protection inadequate; and (C) to cover at least the following hazards: (1) premises and operations; (2) products and completed operations on an “if any”
basis; (3) independent contractors; and (4) blanket contractual liability for all written and oral contracts; 
  
 (iii) Intentionally Omitted; 
  
 (iv) at all times during which structural construction, repairs or alterations are being made with respect to the Improvements (A)
owner’s contingent or protective liability insurance covering claims not covered by or under the terms or provisions of the above mentioned commercial general liability insurance policy; and (B) the insurance provided for in Section 3.3(a)(i)
written in a so-called builder’s risk completed value form (1) on a non-reporting basis, (2) against all risks insured against pursuant to Section 3.3(a)(i), (3) including permission to occupy the Property, and (4) with an agreed amount
endorsement waiving co-insurance provisions; 
  
 (v) workers’ compensation, subject to the statutory limits of the state in which the Property is located, and employer’s liability insurance with a limit of at least $1,000,000 per accident and per disease per employee, and
$1,000,000 for disease aggregate in respect of any work or operations on or about the Property, or in connection with the Property or its operation (if applicable); 
  
 (vi) comprehensive boiler and machinery insurance, if applicable, in amounts as shall be reasonably required
by Lender; 
  
 (vii) if any portion of the
Improvements is at any time located in an area identified by the Secretary of Housing and Urban Development or any successor thereto as an area having special flood hazards pursuant to the National Flood Insurance Act of 1968, the Flood Disaster
Protection Act of 1973 or the National Flood Insurance Reform Act of 1994, as each may be amended, or any successor law (the “Flood Insurance Acts”), flood hazard insurance in an amount equal to the lesser of (A) the principal balance of
the Note, and (B) the maximum limit of coverage available for the Property under the Flood Insurance Acts; 
  
 (viii) intentionally deleted; and 
  
 (ix) such other insurance and in such amounts as Lender from time to time may reasonably request against such other insurable hazards
which at the time are commonly insured against for property similar to the Property located in or around the region in which the Property is located. 
  
 (b) All insurance provided for in Section 3.3(a) hereof shall be obtained under valid and enforceable policies (the “Policies” or in the
singular, the “Policy”), in such forms and, from time to time after the date hereof, in such amounts as may from time to time be satisfactory to 

 
Lender, issued by financially sound and responsible insurance companies authorized and admitted to do business in the state in which the Property is located
and approved by Lender. The insurance companies must have a general policy rating of A or better and a financial class of IX or better by A.M. Best Company, Inc., and a claims paying ability/financial strength rating of at least A- by Standard &
Poor’s Corp. or such comparable rating by such other credit rating agency approved by Lender (a “Rating Agency”) or in the event such insurance company is not so rated, said insurance company shall be acceptable to Lender in all
respects (each such insurer shall be referred to below as a “Qualified Insurer”). Not less than thirty (30) days prior to the expiration dates of the Policies theretofore furnished to Lender pursuant to Section 3.3(a), certified copies of
the Policies marked “premium paid” or accompanied by evidence satisfactory to Lender of payment of the premiums due thereunder (the “Insurance Premiums”), shall be delivered by Borrower to Lender; provided, however, that in the
case of renewal Policies, Borrower may furnish Lender with binders therefor to be followed by the original Policies when issued. 
  
 (c) Borrower shall not obtain (i) any umbrella or blanket liability or casualty Policy unless, in each case, such Policy is approved in advance in writing
by Lender and Lender’s interest is included therein as provided in this Security Instrument and such Policy is issued by a Qualified Insurer, or (ii) separate insurance concurrent in form or contributing in the event of loss with that required
in Section 3.3(a) to be furnished by, or which may be reasonably required to be furnished by, Borrower. In the event Borrower obtains separate insurance or an umbrella or a blanket Policy, Borrower shall notify Lender of the same and shall cause
certified copies of each Policy to be delivered as required in Section 3.3(a) Any blanket insurance Policy shall specifically allocate to the Property the amount of coverage from time to time required hereunder and shall otherwise provide the same
protection as would a separate Policy insuring only the Property in compliance with the provisions of Section 3.3(a). 
  
 (d) All Policies of insurance provided for or contemplated by Section 3.3(a), except for the Policy referenced in Section 3.3(a)(v), shall name Lender and
Borrower as the insured or additional insured, as their respective interests may appear, and in the case of property damage, boiler and machinery, and flood insurance, shall contain a so-called New York standard non-contributing mortgagee clause in
favor of Lender providing that the loss thereunder shall be payable to Lender. 
  
 (e) All Policies of insurance provided for in Section 3.3(a) shall contain clauses or endorsements to the effect that: 
  
 (i) no act or negligence of Borrower, or anyone acting for Borrower, or of any tenant under any Lease or other occupant, or failure to
comply with the provisions of any Policy which might otherwise result in a forfeiture of the insurance or any part thereof, shall in any way affect the validity or enforceability of the insurance insofar as Lender is concerned; 
  
 (ii) the Policy shall not be materially changed (other than
to increase the coverage provided thereby) or cancelled without at least 30 days’ written notice to Lender and any other party named therein as an insured; and 

 (iii) each Policy shall provide that the issuers thereof shall give written notice to
Lender if the Policy has not been renewed thirty (30) days prior to its expiration; and 
  
 (iv) Lender shall not be liable for any Insurance Premiums thereon or subject to any assessments thereunder. 
  
 (f) Borrower shall furnish to Lender, on or before thirty (30) days after the
close of each of Borrower’s fiscal years, a statement certified by Borrower or a duly authorized officer of Borrower of the amounts of insurance maintained in compliance herewith, of the risks covered by such insurance and of the insurance
company or companies which carry such insurance and, if requested by Lender, verification of the adequacy of such insurance by an independent insurance broker or appraiser acceptable to Lender. 
  
 (g) If at any time Lender is not in receipt of written evidence that all
insurance required hereunder is in full force and effect, Lender shall have the right, without notice to Borrower to take such action as Lender deems necessary to protect its interest in the Property, including, without limitation, the obtaining of
such insurance coverage as Lender in its sole discretion deems appropriate, and all expenses incurred by Lender in connection with such action or in obtaining such insurance and keeping it in effect shall be paid by Borrower to Lender upon demand
and until paid shall be secured by this Security Instrument and shall bear interest at the Default Rate (as defined in the Note). Lender shall endeavor to notify Borrower before obtaining any such coverage. 
  
 (h) If the Property shall be damaged or destroyed, in whole or in part, by
fire or other casualty, Borrower shall give prompt notice of such damage to Lender and shall promptly commence and diligently prosecute the completion of the repair and restoration of the Property as nearly as possible to the condition the Property
was in immediately prior to such fire or other casualty, with such alterations as may be approved by Lender (the “Casualty Restoration”) and otherwise in accordance with Section 3.7 of this Security Instrument. Borrower shall pay all costs
of such Restoration whether or not such costs are covered by insurance. 
  
 (i) In the event of a foreclosure of the Security Instrument or other transfer of title to the Property in extinguishment in whole or in part of the Debt, all right, title and interest of Borrower in and to the Policies then in force
concerning the Property and all proceeds payable thereunder shall thereupon vest exclusively in Lender or the purchaser at such foreclosure or other transferee in the event of such other transfer of title. 
  
 Section 3.4 PAYMENT OF TAXES, ETC. 
  
 (a) Borrower shall promptly pay by their due date all taxes, assessments,
water rates, sewer rents, and other governmental impositions, now or hereafter levied or assessed or imposed against the Property or any part thereof (the “Taxes”), all ground rents, maintenance charges and similar charges, now or
hereafter levied or assessed or imposed against the Property or any part thereof (the “Other Charges”), and all charges for utility services provided to the Property as same become due and payable, unless contested in good faith as
provided in subparagraph (b) 

 
below. Borrower will deliver to Lender, promptly upon Lender’s request, evidence satisfactory to Lender that the Taxes, Other Charges and utility
service charges have been so paid or are not then delinquent. Borrower shall not suffer and shall promptly cause to be paid and discharged any lien or charge whatsoever which may be or become a lien or charge against the Property. Borrower shall
furnish to Lender paid receipts for the payment of the Taxes and Other Charges prior to the date the same shall become delinquent. 
  
 (b) After prior written notice to Lender, Borrower, at its own expense, may contest by appropriate legal proceeding, promptly initiated and conducted in
good faith and with due diligence, the amount or validity or application in whole or in part of any of the Taxes, provided that (i) no Event of Default has occurred and is continuing under the Note, this Security Instrument or any of the Other
Security Documents, (ii) Borrower is permitted to do so under the provisions of any other mortgage, deed of trust or deed to secure debt affecting the Property, (iii) such proceeding shall suspend the collection of the Taxes from Borrower and from
the Property or Borrower shall have paid all of the Taxes under protest, (iv) such proceeding shall be permitted under and be conducted in accordance with the provisions of any other instrument to which Borrower is subject and shall not constitute a
default thereunder, (v) neither the Property nor any part thereof or interest therein will be in danger of being sold, forfeited, terminated, cancelled or lost, and (vi) Borrower shall have established appropriate reserves in accordance with GAAP in
respect to the Taxes, together with all interest and penalties thereon, unless Borrower has paid all of the Taxes under protest, or Borrower shall have furnished the security as may be required in the proceeding, or as may be reasonably requested by
Lender to insure the payment of any contested Taxes, together with all interest and penalties thereon. 
  
 Section 3.5 INTENTIONALLY OMITTED. 
  
 Section 3.6 CONDEMNATION. Borrower shall promptly give Lender notice of the actual or threatened commencement of any condemnation or eminent domain
proceeding and shall deliver to Lender copies of any and all papers served in connection with such proceedings. Notwithstanding any taking by any public or quasi-public authority through eminent domain or otherwise (including but not limited to any
transfer made in lieu of or in anticipation of the exercise of such taking), and whether or not any award or payment made in any condemnation or eminent domain proceeding (an “Award”) is made available to Borrower for Restoration in
accordance with Section 3.7, Borrower shall continue to pay the Debt at the time and in the manner provided for its payment in the Note and in this Security Instrument and the Debt shall not be reduced until any Award shall have been actually
received and applied by Lender, after the deduction of expenses of collection, to the reduction or discharge of the Debt. Lender shall not be limited to the interest paid on the Award by the condemning authority but shall be entitled to receive out
of the Award interest at the rate or rates provided herein or in the Note. Borrower shall cause the Award made in any condemnation or eminent domain proceeding, which is payable to Borrower, to be paid directly to Lender. Subject to Section 3.7,
Lender may apply any Award to the reduction or discharge of the Debt whether or not then due and payable. In the event that the Property or any portion thereof is taken by any condemning authority, Borrower shall promptly proceed to restore, repair,
replace or rebuild the Property in a workmanlike manner to the extent practicable to be of at least equal value and substantially the same character as prior to such condemnation or eminent domain proceeding (the “Condemnation
Restoration”; the Condemnation Restoration and the Casualty Restoration are collectively hereinafter referred 

 
to as the “Restoration”). If the Property is sold, through foreclosure or otherwise, prior to the receipt by Lender of the Award, Lender shall have
the right, whether or not a deficiency judgment on the Note shall have been sought, recovered or denied, to receive the Award, or a portion thereof sufficient to pay the Debt. 
  
 Section 3.7 RESTORATION. The following provisions shall apply in connection with the Restoration of the Property:

  
 (a) If the Net Proceeds (defined below) shall be less than
$100,000.00 and the costs of completing the Restoration shall be less than $100,000.00, the Net Proceeds will be disbursed by Lender to Borrower upon receipt, provided that all of the conditions set forth in Section 3.7(b)(i) are met and Borrower
delivers to Lender a written undertaking to expeditiously commence and to satisfactorily complete with due diligence the Restoration in accordance with the terms of this Security Instrument. 
  
 (b) If the Net Proceeds are equal to or greater than $100,000.00 or the costs
of completing the Restoration are equal to or greater than $100,000.00, Lender shall make the Net Proceeds available for the Restoration in accordance with the provisions of this Section 3.7(b). The term “Net Proceeds” for the purposes of
this Section shall mean: (1) the net amount of all insurance proceeds received by Lender pursuant to Section 3.3(a)(i), (iv), (vi), (vii), and, as applicable, (ix) of this Security Instrument as a result of such damage or destruction, after
deduction of its reasonable costs and expenses (including, but not limited to, reasonable legal fees), if any, in collecting same (“Insurance Proceeds”) or (2) the net amount of the Award received by Lender, after deduction of its
reasonable costs and expenses (including, but not limited to, reasonable legal fees), if any, in collecting same (“Condemnation Proceeds”), whichever the case may be. 
  
 (i) The Net Proceeds shall be made available to Borrower for the Restoration provided that each of the
following conditions is met: 
  
 (A) no Event of
Default shall have occurred and be continuing under the Note, the Credit Agreement, this Security Instrument or any of the Other Security Documents; 
  
 (B) (1) in the event the Net Proceeds are Insurance Proceeds, less than twenty percent (20%) of the total floor area of the Improvements
has been damaged, destroyed or rendered unusable as a result of such fire or other casualty or (2) in the event the Net Proceeds are Condemnation Proceeds, less than twenty - percent (20%) of the land constituting the Property has been taken, such
land is located along the perimeter or periphery of the Property, no portion of the Improvements is located on such land and such taking does not materially impair the existing access to the Property; 
  
 (C) Intentionally Deleted; 

 (D) Borrower shall commence the Restoration as soon as reasonably practicable (but in no
event later than thirty (30) days after such damage, destruction or taking occurs) and shall diligently pursue the same to satisfactory completion; 
  
 (E) Lender shall be satisfied that any operating deficits which will be incurred with respect to the Property as a result of the
occurrence of any such fire or other casualty or taking will be covered out of (1) the Net Proceeds, or (2) other funds of Borrower; 
  
 (F) Intentionally Omitted; 
  
 (G) Lender shall be satisfied that the Restoration will be completed on or before the earliest to occur of (1) twelve (12) months prior to
the Loan Maturity Date (as defined in the Note), (2) twelve (12) months after the occurrence of such fire or other casualty or taking, or (3) such time as may be required under applicable zoning law, ordinance, rule or regulation in order to repair
and restore the Property to the condition it was in immediately prior to such fire or other casualty or taking; 
  
 (H) Borrower shall execute and deliver to Lender a completion guaranty in form and substance satisfactory to Lender and its counsel
pursuant to the provisions of which Borrower shall guaranty to Lender the lien-free completion by Borrower of the Restoration in accordance with the provisions of this Section 3.7(b); 
  
 (I) the Property and the use thereof after the Restoration will be in compliance with and permitted under
all applicable zoning laws, ordinances, rules and regulations; and 
  
 (J) the Restoration shall be done and completed by Borrower in an expeditious and diligent fashion and in compliance with all applicable governmental laws, rules and regulations (including, without limitation, all
applicable Environmental Laws (defined below). 
  
 (ii) The Net Proceeds shall be held by Lender in an interest bearing trust account and, until disbursed in accordance with the provisions of this Section 3.7(b), shall constitute additional security for the Obligations. The Net Proceeds
shall be disbursed by Lender to, or as directed by, Borrower from time to time during the course of the Restoration, upon receipt of evidence satisfactory to Lender that (A) all materials installed and work and labor performed (except to the extent
that they are to be paid for out of the requested disbursement) in connection with the Restoration have been paid for in full, and (B) there exist no notices of pendency, stop orders, mechanics or materialman’s liens or notices of intention to
file same, or any other liens or encumbrances of any nature whatsoever on the Property arising out of the Restoration which have not either been fully bonded to the satisfaction of Lender and discharged of record or in the alternative fully insured
to the satisfaction of Lender by the title company insuring the lien of this Security Instrument. 

 (iii) All plans and specifications required in connection with the Restoration shall be
subject to prior review and acceptance in all respects by Lender and by an independent consulting engineer selected by Lender (the “Restoration Consultant”). Lender shall have the use of the plans and specifications and all permits,
licenses and approvals required or obtained in connection with the Restoration. The identity of the contractors, subcontractors and materialmen engaged in the Restoration, as well as the contracts under which they have been engaged, shall be subject
to prior review and acceptance by Lender and the Restoration Consultant. All costs and expenses incurred by Lender in connection with making the Net Proceeds available for the Restoration including, without limitation, reasonable legal fees and
disbursements and the Restoration Consultant’s fees, shall be paid by Borrower. 
  
 (iv) In no event shall Lender be obligated to make disbursements of the Net Proceeds in excess of an amount equal to the costs actually
incurred from time to time for work in place as part of the Restoration, as certified by the Restoration Consultant, minus the Restoration Retainage. The term “Restoration Retainage” as used in this Section 3.7(b) shall mean an amount
equal to 10% of the costs actually incurred for work in place as part of the Restoration, as certified by the Restoration Consultant. The Restoration Retainage shall in no event be less than the amount actually held back by Borrower from
contractors, subcontractors and materialmen engaged in the Restoration. The Restoration Retainage shall not be released until the Restoration Consultant certifies to Lender that the Restoration has been completed in accordance with the provisions of
this Section 3.7(b) and that all approvals necessary for the re-occupancy and use of the Property have been obtained from all appropriate governmental and quasi-governmental authorities, and Lender receives evidence satisfactory to Lender that the
costs of the Restoration have been paid in full or will be paid in full out of the Restoration Retainage, provided, however, that Lender will release the portion of the Restoration Retainage being held with respect to any contractor, subcontractor
or materialman engaged in the Restoration as of the date upon which the Restoration Consultant certifies to Lender that the contractor, subcontractor or materialman has satisfactorily completed all work and has supplied all materials in accordance
with the provisions of the contractor’s, subcontractor’s or materialman’s contract, and the contractor, subcontractor or materialman delivers the lien waivers and evidence of payment in full of all sums due to the contractor,
subcontractor or materialman as may be reasonably requested by Lender or by the title company insuring the lien of this Security Instrument. If required by Lender, the release of any such portion of the Restoration Retainage shall be approved by the
surety company, if any, which has issued a payment or performance bond with respect to the contractor, subcontractor or materialman. 
  
 (v) Lender shall not be obligated to make disbursements of the Net Proceeds more frequently than once every calendar month. 
  
 (vi) If at any time the Net Proceeds or the undisbursed
balance thereof shall not, in the reasonable opinion of Lender, be sufficient to pay in full the balance of the costs 

 
which are estimated by the Restoration Consultant to be incurred in connection with the completion of the Restoration, Borrower shall not be entitled to any
further disbursements of the Net Proceeds hereunder until Borrower shall deposit the deficiency (the “Net Proceeds Deficiency”) in immediately available funds with Lender. The Net Proceeds Deficiency deposited with Lender shall be held by
Lender and shall be disbursed for costs actually incurred in connection with the Restoration on the same conditions applicable to the disbursement of the Net Proceeds, and until so disbursed pursuant to this Section 3.7(b) shall constitute
additional security for the Obligations. 
  
 (vii) The excess, if any, of the Net Proceeds and the remaining balance, if any, of the Net Proceeds Deficiency deposited with Lender after the Restoration Consultant certifies to Lender that the Restoration has been completed in accordance
with the provisions of this Section 3.7(b), and the receipt by Lender of evidence satisfactory to Lender that all costs incurred in connection with the Restoration have been paid in full, shall be remitted by Lender to Borrower, with any interest
earned thereon, provided no Event of Default shall have occurred and shall be continuing under the Note, the Credit Agreement, this Security Instrument or any of the Other Security Documents. 
  
 (c) All Net Proceeds not required (i) to be made available for the
Restoration or (ii) to be returned to Borrower as excess Net Proceeds pursuant to Section 3.7(b)(vii) may be retained and applied by Lender toward the payment of the Debt whether or not then due and payable in such order, priority and proportions as
Lender in its discretion shall deem proper or, at the discretion of Lender, the same may be paid, either in whole or in part, to Borrower for such purposes as Lender shall designate, in its discretion. If Lender shall receive and retain Net
Proceeds, the lien of this Security Instrument shall be reduced only by the amount thereof received and retained by Lender and actually applied by Lender in reduction of the Debt. 
  
 Section 3.8 LEASES AND RENTS. 
  
 (a) Borrower may enter into a proposed Lease (including the renewal or extension of an existing Lease (a “Renewal
Lease”)) without the prior written consent of Lender, provided such proposed Lease or Renewal Lease (i) provides for rental rates and terms comparable to existing local market rates and terms (taking into account the type and quality of the
tenant) as of the date such Lease is executed by Borrower (unless, in the case of a Renewal Lease, the rent payable during such renewal, or a formula or other method to compute such rent, is provided for in the original Lease), (ii) is an
arms-length transaction with a bona fide, independent third party tenant, (iii) does not have a materially adverse effect on the value of the Property taken as a whole, (iv) is subject and subordinate to the Security Instrument and the lessee
thereunder agrees to attorn to Lender, and (v) is written on a form of lease approved by Lender. All proposed Leases which do not satisfy the requirements set forth in this Section 3.8(a) shall be subject to the prior approval of Lender and its
counsel, at Borrower’s expense. Borrower shall promptly deliver to Lender copies of all Leases which are entered into pursuant to this Subsection together with Borrower’s certification that it has satisfied all of the conditions of this
Subsection. 
  
 (b) Borrower (i) shall observe and perform all the
obligations imposed upon the lessor under the Leases and shall not do or permit to be done anything to impair the value of any of the Leases as security for the Debt; (ii) shall promptly send copies to Lender of all notices of default 

 
which Borrower shall send or receive thereunder; (iii) shall enforce all of the material terms, covenants and conditions contained in the Leases upon the
part of the tenant thereunder to be observed or performed; (iv) shall not collect any of the Rents more than one (1) month in advance (except security deposits shall not be deemed Rents collected in advance); (v) shall not execute any other
assignment of the lessor’s interest in any of the Leases or the Rents; and (vi) shall not consent to any assignment of or subletting under any Leases not in accordance with their terms, without the prior written consent of Lender. 

 
 (c) Except with respect to any Major Lease (defined below), Borrower may,
without the consent of Lender, amend, modify or waive the provisions of any Lease or terminate, reduce rents under, accept a surrender of space under, or shorten the term of; any Lease (including any guaranty, letter of credit or other credit
support with respect thereto) provided that such action (taking into account, in the case of a termination, reduction in rent, surrender of space or shortening of term, the planned alternative use of the affected space) does not have a materially
adverse effect on the value of the Property taken as a whole, and provided that such Lease, as amended, modified or waived, is otherwise in compliance with the requirements of this Security Instrument and any subordination agreement binding upon
Lender with respect to such Lease. A termination of a Lease with a tenant who is in default beyond applicable notice and grace periods shall not be considered an action which has a materially adverse effect on the value of the Property taken as a
whole. Any amendment, modification, waiver, termination, rent reduction, space surrender or term shortening which does not satisfy the requirements set forth in this Subsection shall be subject to the prior approval of Lender and its counsel, at
Borrower’s expense. Borrower shall promptly deliver to Lender copies of amendments, modifications and waivers which are entered into pursuant to this Subsection together with Borrower’s certification that it has satisfied all of the
conditions of this Subsection. 
  
 (d) Notwithstanding anything
contained herein to the contrary, Borrower shall not, without the prior written consent of Lender, enter into, renew, extend, amend, modify, waive any provisions of, terminate, reduce rents under, accept a surrender of space under, or shorten the
term of any Major Lease. The term “Major Lease” shall mean (i) any Lease which (A) covers twenty percent (20%) or more of the total space at the Property, in the aggregate, or (B) provides for a lease term of more than ten (10) years
including options to renew and (ii) any instrument guaranteeing or providing credit support for any Major Lease. 
  
 Section 3.9 MAINTENANCE AND USE OF PROPERTY. Borrower shall cause the Property to be maintained in a good and safe condition and repair. Borrower
shall not (and shall not permit any tenant or other person to) remove, demolish or materially alter the Property or any part thereof (except for normal replacement of the Personal Property) without the consent of Lender. Borrower shall promptly
repair, replace or rebuild any part of the Property which may be destroyed by any casualty, or become damaged, worn or dilapidated or which may be affected by any proceeding of the character referred to in Section 3.6 hereof and shall complete and
pay for any structure at any time in the process of construction or repair on the Land. Borrower shall not initiate, join in, acquiesce in, or consent to any material change in any private restrictive covenant, zoning law or other public or private
restriction, limiting or defining the uses which may be made of the Property or any part thereof without the prior written consent of Lender, which consent shall not be unreasonably withheld or delayed. If under applicable zoning 

 
provisions the use of all or any portion of the Property is or shall become a nonconforming use, Borrower will not cause or permit the nonconforming use to
be discontinued or the nonconforming Improvement to be abandoned without the express written consent of Lender. 
  
 Section 3.10 WASTE. Borrower shall not commit or suffer any waste of the Property or make any change in the use of the Property which will in any
way materially increase the risk of fire or other hazard arising out of the operation of the Property, or take any action that might invalidate or give cause for cancellation of any Policy, or do or permit to be done thereon anything that may
materially impair the value of the Property or the security of this Security Instrument. Borrower will not, without the prior written consent of Lender, permit any drilling or exploration for or extraction, removal, or production of any minerals
from the surface or the subsurface of the Land, regardless of the depth thereof or the method of mining or extraction thereof. 
  
 Section 3.11 COMPLIANCE WITH LAWS. 
  
 (a) Borrower shall promptly comply in all material respects with all Applicable Laws (defined in Section 20.1) affecting the Property, or the use thereof,
including all Environmental Laws. 
  
 (b) Borrower shall from time
to time, upon Lender’s request, provide Lender with evidence reasonably satisfactory to Lender that the Property complies with all Applicable Laws or is exempt from compliance with Applicable Laws. 
  
 (c) Notwithstanding any provisions set forth herein or in any document
regarding Lender’s approval of alterations of the Property, Borrower shall not alter the Property in any manner which would materially increase Borrower’s responsibilities for compliance with Applicable Laws without the prior written
approval of Lender. Lender’s approval of the plans, specifications, or working drawings for alterations of the Property shall create no responsibility or liability on behalf of Lender for their completeness, design, sufficiency or their
compliance with Applicable Laws. The foregoing shall apply to tenant improvements constructed by Borrower or by any of its tenants. Lender may condition any such approval upon receipt of a certificate of compliance with Applicable Laws from an
independent architect, engineer, or other person acceptable to Lender. 
  
 (d) Borrower shall give prompt notice to Lender of the receipt by Borrower of any notice related to a violation of any Applicable Laws and of the commencement of any proceedings or investigations which relate to compliance with Applicable
Laws. 
  
 (e) After prior written notice to Lender, Borrower, at
its own expense, may contest by appropriate legal proceeding, promptly initiated and conducted in good faith and with due diligence, the Applicable Laws affecting the Property, provided that (i) no Event of Default has occurred and is continuing
under the Note, the Credit Agreement, this Security Instrument or any of the Other Security Documents; (ii) Borrower is permitted to do so under the provisions of any other mortgage, deed of trust or deed to secure debt affecting the Property; (iii)
such proceeding shall be permitted under and be conducted in accordance with the provisions of any other instrument to which Borrower or the Property is subject and shall not constitute a default 

 
thereunder; (iv) neither the Property, any part thereof or interest therein, any of the tenants or occupants thereof, nor Borrower shall be affected in any
material adverse way as a result of such proceeding; (v) non-compliance with the Applicable Laws shall not impose criminal or material civil liability on Borrower or Lender; (vi) Borrower shall have furnished the security as may be required in the
proceeding or by Lender to ensure compliance by Borrower with the Applicable Laws and (vii) Borrower shall have furnished to Lender all other items reasonably requested by Lender. 
  
 Section 3.12 PAYMENT FOR LABOR AND MATERIALS. Borrower will promptly pay when due all applicable bills and costs for
labor, materials, and specifically fabricated materials incurred in connection with the Property and never permit to exist in respect of the Property or any part thereof any lien or security interest, even though inferior to the liens and the
security interests hereof; and in any event never permit to be created or exist in respect of the Property or any part thereof any other or additional lien or security interest other than the liens or security interests hereof; except for the
Permitted Exceptions (defined below). 
  
 Section 3.13
PERFORMANCE OF OTHER AGREEMENTS. Borrower shall observe and perform each and every term to be observed or performed by Borrower pursuant to the terms of any agreement or recorded instrument affecting or pertaining to the Property, or given by
Borrower to Lender for the purpose of further securing an Obligation and any amendments, modifications or changes thereto. 
  
 Section 3.14 MANAGEMENT. The Property shall be managed by Borrower. All Rents, if any, generated by or derived from the Property shall first be
utilized solely for current expenses directly attributable to the ownership and operation of the Property, including, without limitation, current expenses relating to Borrower’s liabilities and obligations with respect to the Note, this
Security Instrument and the Other Security Documents, and none of the Rents generated by or derived from the Property shall be diverted by Borrower and utilized for any other purpose unless all such current expenses attributable to the ownership and
operation of the Property have been fully paid and satisfied. 
  
 Article 4 - SPECIAL COVENANTS 
  
 Borrower
covenants and agrees that: 
  
 Section 4.1 PROPERTY USE.
The Property shall be used only for manufacturing, warehouse, research and development, showroom and office purposes, and for no other use without the prior written consent of Lender. 
  
 Article 5 - REPRESENTATIONS AND WARRANTIES 
  
 Borrower represents and warrants to Lender that: 
  
 Section 5.1 WARRANTY OF TITLE. Borrower has good title to the Property and has the right to mortgage, grant, bargain,
sell, pledge, assign, warrant, transfer and convey the same and that Borrower possesses an unencumbered fee simple absolute estate in the Land and the Improvements and that it owns the Property free and clear of all liens, encumbrances and charges

 
whatsoever except for those exceptions shown in the title insurance policy insuring the lien of this Security Instrument (the “Permitted
Exceptions”). Borrower shall forever warrant, defend and preserve the title and the validity and priority of the lien of this Security Instrument and shall forever warrant and defend the same to Lender against the claims of all persons
whomsoever, other than with respect to Permitted Exceptions (as such term is defined in the Credit Agreement). 
  
 Section 5.2 STATUS OF PROPERTY. 
  
 (a) Borrower has obtained all material certificates, licenses and other approvals, governmental and otherwise, necessary for the operation of the Property
and the conduct of its business and all required zoning, building code, land use, environmental and other similar permits or approvals, all of which are in flu force and effect as of the date hereof and not subject to revocation, suspension,
forfeiture or modification. 
  
 (b) The Property and the present
and contemplated use and occupancy thereof are in compliance, in all material respects, with all applicable zoning ordinances, building codes, land use laws, Environmental Laws and other similar laws. 
  
 (c) The Property is served by all utilities required for the current or
currently contemplated use thereof All utility service is provided by public utilities and the Property has accepted or is equipped to accept such utility service. 
  
 (d) All public roads and streets necessary for service of and access to the Property for the current or contemplated use
thereof have been completed, are serviceable and are physically and legally open for use by the public. 
  
 (e) The Property is served by public water and sewer systems. 
  
 (f) The Property is free from damage caused by fire or other casualty. 
  
 (g) All costs and expenses of any and all labor, materials, supplies and equipment used in the construction of the
Improvements that are due and payable have been paid in full. 
  
 (h) Borrower has paid in full for, and is the owner of; all furnishings, fixtures and equipment used in connection with the operation of the Property, free and clear of any and all security interests, liens or encumbrances, except the lien
and security interest created hereby, except for Permitted Exceptions. 
  
 (i) All liquid and solid waste disposal, septic and sewer systems located on the Property are in a good and safe condition and repair and in compliance (in all material respects) with all Applicable Laws. 
  
 (j) No portion of the Improvements is located in an area identified by the
Federal Emergency Management Agency or any successor thereto as an area having special flood hazards pursuant to the Flood Insurance Acts or, if any portion of the Improvements is located within such area, Borrower has obtained and will maintain the
insurance prescribed in Section 3.3(a) (vii) hereof. 

 (k) All the Improvements lie within the boundaries of the Land. 
  
 (l) The Property is presently not subject to any Leases. 
  
 Section 5.3 SEPARATE TAX LOT. The Property is assessed for real estate
tax purposes as one or more wholly independent tax lot or lots, separate from any adjoining land or improvements not constituting a part of such lot or lots, and no other land or improvements is assessed and taxed together with the Property or any
portion thereof 
  
 Section 5.4 PERMITTED EXCEPTIONS. None
of the Permitted Exceptions, individually or in the aggregate, materially interferes with the benefits of the security intended to be provided by the Security Instrument, the Note, and the Other Security Documents, materially and adversely affects
the value of the Property, impairs the use or the operation of the Property or impairs Borrower’s ability to pay its obligations in a timely manner. 
  
 Article 6 - OBLIGATIONS AND RELIANCE’S 
  
 Section 6.1 RELATIONSHIP OF BORROWER AND LENDER. The relationship between Borrower and Lender is solely that of debtor and creditor, and Lender has
no fiduciary or other special relationship with Borrower, and no term or condition of any of the Note, the Credit Agreement, this Security Instrument and the Other Security Documents shall be construed so as to deem the relationship between Borrower
and Lender to be other than that of debtor and creditor. 
  
 Section 6.2 NO RELIANCE ON LENDER. The members, general partners, principals and (if Borrower is a trust) beneficial owners of Borrower are experienced in the ownership and operation of properties similar to the Property, and
Borrower and Lender are relying solely upon such expertise in connection with the ownership and operation of the Property. Borrower is not relying on Lender’s expertise, business acumen or advice in connection with the Property. 
  
 Section 6.3 No LENDER OBLIGATIONS. (a) Notwithstanding anything herein
to the contrary, Lender is not undertaking the performance of (i) any obligations under the Leases; or (ii) any obligations with respect to such agreements, contracts, certificates, instruments, franchises, permits, trademarks, licenses and other
documents. 
  
 (b) By accepting or approving anything required to
be observed, performed or fulfilled or to be given to Lender pursuant to this Security Instrument, the Note or the Other Security Documents, including without limitation, any officer’s certificate, balance sheet, statement of profit and loss or
other financial statement, survey, appraisal, or insurance policy, Lender shall not be deemed to have warranted, consented to, or affirmed the sufficiency, the legality or effectiveness of same, and such acceptance or approval thereof shall not
constitute any warranty or affirmation with respect thereto by Lender. 
  
 Section 6.4 RELIANCE. Borrower recognizes and acknowledges that in accepting the Note, the Credit Agreement, this Security Instrument and the Other Security Documents, Lender 

 
is expressly and primarily relying on the truth and accuracy of the warranties and representations set forth in Article 5 and Article 12 without any
obligation to investigate the Property and notwithstanding any investigation of the Property by Lender; that such reliance existed on the part of Lender prior to the date hereof; that the warranties and representations are a material inducement to
Lender in accepting the Note, this Security Instrument and the Other Security Documents; and that Lender would not be willing to make the Loan and accept this Security Instrument in the absence of the warranties and representations as set forth in
Article 5 and Article 12. 
  
 Article 7 - FURTHER ASSURANCES

  
 Section 7.1 RECORDING OF SECURITY INSTRUMENT, ETC.

  
 (a) Borrower forthwith upon the execution and delivery of this
Security Instrument and thereafter, from time to time, will cause this Security Instrument and any of the Other Security Documents creating a lien or security interest or evidencing the lien hereof upon the Property and each instrument of further
assurance to be filed, registered or recorded in such manner and in such places as may be required by any present or future law in order to publish notice of and fully to protect and perfect the lien or security interest hereof upon, and the
interest of Lender in, the Property. Borrower will pay all taxes, filing, registration or recording fees, and all expenses incident to the preparation, execution, acknowledgment and/or recording of the Note, the Credit Agreement, this Security
Instrument, the Other Security Documents, any note or deed of trust or mortgage supplemental hereto, any security instrument with respect to the Property and any instrument of further assurance, and any modification or amendment of the foregoing
documents, and all federal, state, county and municipal taxes, duties, imposts, assessments and charges arising out of or in connection with the execution and delivery of this Security Instrument, any deed of trust or mortgage supplemental hereto,
any security instrument with respect to the Property or any instrument of further assurance, and any modification or amendment of the foregoing documents, except where prohibited by law so to do. 
  
 (b) The Borrower hereby irrevocably authorizes the Lender at any time and
from time to time to file in any filing office in any Uniform Commercial Code jurisdiction any initial financing statements and amendments thereto that provide any information required by part 5 of Article 9 of the Uniform Commercial Code of
the state(s) where any of the Property is located or such other jurisdiction for the sufficiency or filing office acceptance of any financing statement or amendment, including (i) whether the Borrower is an organization, the type of organization and
any organization identification number issued to the Borrower and, (ii) in the case of a financing statement filed as a fixture filing a sufficient description of real property to which the Property relates. The Borrower agrees to furnish any such
information to the Lender promptly upon the Lenders request. The Borrower also ratifies its authorization for the Lender to have filed in any Uniform Commercial Code jurisdiction any like initial financing statements or amendments thereto if filed
prior to the date hereof 
  
 Section 7.2 FURTHER ACTS, ETC.
Borrower will, at the cost of Borrower, and without expense to Lender, do, execute, acknowledge and deliver all and every such further acts, deeds, conveyances, mortgages, deeds of trusts, assignments, notices of assignments, transfers 

 
and assurances as Lender shall, from time to time, reasonably require, for the better assuring, conveying, assigning, transferring, and confirming unto
Lender the Property and rights hereby mortgaged, granted, bargained, sold, conveyed, confirmed, pledged, assigned, warranted and transferred or intended now or hereafter so to be, or which Borrower may be or may hereafter become bound to convey or
assign to Lender, or for carrying out the intention or facilitating the performance of the terms of this Security Instrument or for filing, registering or recording this Security Instrument, or for complying with all Applicable Laws. Borrower, on
demand, will execute and deliver and hereby authorizes Lender to execute in the name of Borrower or without the signature of Borrower to the extent Lender may lawfully do so, one or more instruments, to evidence or perfect more effectively the
security interest of Lender in the Property. Borrower grants to Lender an irrevocable power of attorney coupled with an interest for the purpose of exercising and perfecting any and all rights and remedies available to Lender pursuant to this
Section 7.2 
  
 Section 7.3 CHANGES IN TAX, DEBT CREDIT AND
DOCUMENTARY STAMP LAWS. 
  
 (a) If any law is enacted or
adopted or amended after the date of this Security Instrument which deducts the Debt from the value of the Property for the purpose of taxation or which imposes a tax, either directly or indirectly, on the Debt or Lender’s interest in the
Property, Borrower will pay the tax, with interest and penalties thereon, if any. If Lender is advised by counsel chosen by it that the payment of tax by Borrower would be unlawful or taxable to Lender or unenforceable or provide the basis for a
defense of usury, then Lender shall have the option, exercisable by written notice of not less than ninety (90) days, to declare the Debt immediately due and payable. 
  
 (b) Borrower will not claim or demand or be entitled to any credit or credits on account of the Debt for any part of the
Taxes or Other Charges assessed against the Property, or any part thereof, and no deduction shall otherwise be n-jade or claimed from the assessed value of the Property,- or any part thereof, for real estate tax purposes by reason of this Security
Instrument or the Debt. If such claim, credit or deduction shall be required by law, Lender shall have the option, exercisable by written notice of not less than ninety (90) days, to declare the Debt immediately due and payable. 
  
 (c) If at any time the United States of America, any State thereof or any
subdivision of any such State shall require revenue or other stamps to be affixed to the Note, this Security Instrument, or any of the Other Security Documents or impose any other tax or charge on the same, Borrower will pay for the same, with
interest and penalties thereon, if any. 
  
 Section 7.4
ESTOPPEL CERTIFICATES. 
  
 (a) After request by
Lender, Borrower, within ten (10) days, shall furnish Lender or any proposed assignee with a statement, duly acknowledged and certified, setting forth (i) the original principal amount of the Note, (ii) the unpaid principal amount of the Note, (iii)
the rate of interest of the Mote, (iv) the terms of payment and Loan Maturity Date of the Note, (v) the date installments of interest and/or principal were last paid, (vi) that, except as provided in such statement, there are no defaults or events
which with the passage of time or the giving of notice 

 
or both, would constitute an event of default under the Note or the Security Instrument, (vii) that the Note and this Security Instrument are valid, legal
and binding obligations and have not been modified or if modified, giving particulars of such modification, (viii) whether any offsets or defenses exist against the obligations secured hereby and, if any are alleged to exist, a detailed description
thereof, (ix) that all Leases, if any, are in full force and effect and have not been modified (or if modified, setting forth all modifications), (x) the date to which the Rents thereunder have been paid pursuant to the Leases, if any, (xi) whether
or not, to the best knowledge of Borrower, any of the lessees under the Leases, if any, are in default under the Leases, if any, and, if any of the lessees are in default, setting forth the specific nature of all such defaults, (xii) the amount of
security deposits held by Borrower under each Lease, if any, and that such amounts are consistent with the amounts required under such Lease, and (xiii) as to any other matters reasonably requested by Lender and reasonably related to the Leases, if
any, the obligations secured hereby, the Property or this Security Instrument. 
  
 (b) If there are Leases in effect, Borrower shall use its best efforts to deliver to Lender, promptly upon request, duly executed estoppel certificates from any one or more lessees as required by Lender attesting to
such facts regarding the Lease as Lender may require, including, but not limited to, attestations that each Lease covered thereby is in full force and effect with no defaults thereunder on the part of any party, that none of the Rents have been paid
more than one month in advance, except- as security, and that the lessee claims no defense or offset against the full and timely performance of its obligations under the Lease. 
  
 (c) Upon any transfer or proposed transfer contemplated by Section 18.1 hereof, at Lender’s request, Borrower shall
provide an estoppel certificate to the Investor (defined in Section 18.1) or any prospective Investor in such form, substance and detail as Lender, such Investor or prospective Investor may require. 
  
 Section 7.5 FLOOD INSURANCE. After Lender’s request, Borrower
shall deliver evidence satisfactory to Lender that no portion of the Improvements is situated in a federally designated “special flood hazard area” or, if it is, that Borrower has obtained insurance meeting the requirements of Section
3.3(a)(vii). 
  
 Section 7.6 REPLACEMENT DOCUMENTS. Upon
receipt of an affidavit of an officer of Lender as to the loss, theft, destruction or mutilation of the Note or any Other Security Document which is not of public record, and, in the case of any such mutilation, upon surrender and cancellation of
such Note or Other Security Document, Borrower will issue, in lieu thereof, a replacement Note or Other Security Document, dated the date of such lost, stolen, destroyed or mutilated Note or Other Security Document in the same principal amount
thereof and otherwise of like tenor. 
  
 Article 8 - DUE ON
SALE/ENCUMBRANCE 
  
 Section 8.1 TRANSFER DEFINITIONS.
For purposes of this Article 8 , a “Sale or Pledge” shall mean a voluntary or involuntary sale, conveyance, transfer or pledge of a legal or beneficial interest. 

 Section 8.2 NO SALE/ENCUMBRANCE. (a) Borrower shall not sell, convey, mortgage, grant, bargain,
encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or
any part thereof or any legal or beneficial interest therein (collectively a “Transfer”), other than pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 3.8, without the prior written
consent of Lender. 
  
 (b) A Transfer shall include, but not be
limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property or any part thereof for a price to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property for other than
actual occupancy by a space tenant thereunder or a sale, assignment or other transfer of, or the grant of a security interest in, Borrower’s right, title and interest in and to any Leases or any Rents; (iii) a Change in Control (as such term is
defined in the Credit Agreement). 
  
 Section 8.3 PERMITTED
TRANSFERS. (a) Notwithstanding the provisions of Section 8.1 and 8.2, but subject to Section 7.1(r) of the Credit Agreement, the following shall not constitute a Transfer: (1) the sale, transfer or issuance of stock in Borrower or any beneficial
ownership interest therein, provided same does not constitute a Change in Control (as such term is defined in the Credit Agreement); and (ii) the disposition of any part of the Property, other than real property, consisting of obsolete or unused
assets, provided that such obsolete or unused assets shall be replaced with assets of equal or greater value, and such replacement assets shall constitute a part of the Property. 
  
 Article 9 - PREPAYMENT 
  
 Section 9.1 PREPAYMENT. The Debt may not be prepaid in whole or in part except in strict accordance with the express terms and conditions of the
Note. 
  
 Article 10 - DEFAULT 
  
 Section 10.1 EVENTS OF DEFAULT. The occurrence of any one or more of
the following events shall constitute an “Event of Default”: 
  
 (a) the occurrence of any “Event of Default” as such term is defined in the Credit Agreement; 
  
 (b) if any of the Taxes or Other Charges is not paid when the same is due and payable except in accordance with the terms of Section 3.4 of this Security
Instrument; 
  
 (c) if the Policies are not kept in full force and
effect, or if the Policies are not delivered to Lender as provided in Section 3.3(b); 
  
 (d) if the Property becomes subject to any mechanic’s, materialman’s or other lien other than a lien not then due and payable and the lien shall remain undischarged of record (by payment, bonding or
otherwise) for a period of thirty (30) days; 

 (e) if any federal tax lien is filed against Borrower or the Property and same is not discharged of
record within thirty (30) days after same is filed; 
  
 (f) if
Borrower shall fail to deliver to Lender, within ten (10) days after request by Lender, the estoppel certificates required by Section 7.4(a) and (c); 
  
 (g) if any default occurs under any guaranty or indemnity executed in connection herewith (including the Environmental Indemnity, defined in Section 13.4)
and such default continues after the expiration of applicable grace periods, if any; or 
  
 (h) if for more than ten (10) days after notice from Lender, Borrower shall continue to be in default under any term, covenant or condition of this Security Instrument not set forth in Section 10.1(a) through (g)
above, then, in the case of any default which can be cured by the payment of a sum of money, or for thirty (30) days after notice from Lender in the case of any other default, provided that if such default cannot reasonably be cured within such
thirty (30) day period and Borrower shall have commenced to cure such default within such thirty (30) day period and thereafter diligently and expeditiously proceeds to cure the same, such thirty (30) day period shall be extended for so long as it
shall require Borrower in the exercise of due diligence to cure such default, it being agreed that no such extension shall be for a period in excess of ninety (90) days. 
  
 Article 11 - RIGHTS AND REMEDIES 
  
 Section 11.1 REMEDIES. Upon the occurrence of any Event of Default, Borrower agrees that Lender may take such action,
without notice or demand, as it deems advisable to protect and enforce its rights against Borrower in and to the Property, including, but not limited to the following actions, each of which may be pursued concurrently or otherwise, at such time and
in such order as Lender may determine, in its sole discretion, without impairing or otherwise affecting the other rights and remedies of Lender: 
  
 (a) declare the entire unpaid Debt to be immediately due and payable; 
  
 (b) institute proceedings, judicial or otherwise, for the complete foreclosure of this Security Instrument under any
applicable state or federal law in which case the Property or any interest therein may be sold for cash or upon credit in one or more parcels or in several interests or portions and in any order or manner; 
  
 (c) with or without entry, to the extent permitted and pursuant to the
procedures provided by applicable state or federal law, institute proceedings for the partial foreclosure of this Security Instrument for the portion of the Debt then due and payable, subject to the continuing lien and security interest of
this Security Instrument for the balance of the Debt not then due, unimpaired and without loss of priority; 
  
 (d) sell for cash or upon credit the Property or any part thereof and all estate, claim, demand, right, title and interest of Borrower therein and rights
of redemption thereof, pursuant to power of sale or otherwise, at one or more sales, in one or more parcels, at such time and place, upon such terms and after such notice thereof as may be required or permitted bylaw; 

 (e) institute an action, suit or proceeding in equity for the specific performance of any covenant,
condition or agreement contained herein, in the Note or in the Other Security Documents; 
  
 (f) recover judgment on the Note either before, during or after any proceedings for the enforcement of this Security Instrument or the Other Security Documents; 
  
 (g) apply for the appointment of a receiver, trustee, liquidator or
conservator of the Property, without notice and without regard for the adequacy of the security for the Debt and without regard for the solvency of Borrower or of any person, firm or other entity liable for the payment of the Debt; 
  
 (h) subject to any applicable state or federal law, the license granted to
Borrower under Section 1.2 shall automatically be revoked and Lender may enter into or upon the Property, either personally or by its agents, nominees or attorneys and dispossess Borrower and its agents and servants therefrom, without liability for
trespass, damages or otherwise and exclude Borrower and its agents or servants wholly therefrom, and take possession of all rent rolls, leases (including the form lease and amendments and exhibits), subleases (including the form sublease and
amendments and exhibits) and rental and license agreements with the tenants, subtenants and licensees, in possession of the Property or any part or parts thereof; tenants, subtenants, and licensees, money deposits or other property (including,
without limitation, any letter of credit) given to secure tenants, subtenants, and licensees, obligations under leases, subleases or licenses, together with a list of the foregoing; all lists pertaining to current rent and license fee arrears; any
and all architects, plans and specifications, licenses and permits, documents, books, records, accounts, surveys and property which relate to the management, leasing, operation, occupancy, ownership, insurance, maintenance, or service of or
construction upon the Property and Borrower agrees to surrender possession thereof and of the Property to Lender upon demand, and thereupon Lender may (i) use, operate, manage, control, insure, maintain, repair, restore and otherwise deal with all
and every part of the Property and conduct the business thereat; (ii) complete any construction on the Property in such manner and form as Lender deems advisable; (iii) make alterations, additions, renewals, replacements and improvements to or on
the Property; (iv) exercise all rights and powers of Borrower with respect to the Property, whether in the name of Borrower or otherwise, including without limitation, the right to make, cancel, enforce or modify Leases, obtain and evict tenants,
and demand, sue for, collect and receive all Rents of the Property and every part thereof; (v) either require Borrower (A) to pay monthly in advance to Lender, or any receiver appointed to collect the Rents, the fair and reasonable rental value for
the use and occupation of such part of the Property as may be occupied by Borrower, or (B) to vacate and surrender possession of the Property to Lender or to such receiver and, in default thereof, Borrower may be evicted by summary proceedings or
otherwise; and (vi) apply the receipts from the Property to the payment of the Debt, in such order, priority and proportions as Lender shall deem appropriate in its sole discretion after deducting therefrom all expenses (including reasonable legal
fees) incurred in connection with the aforesaid operations and all amounts necessary to pay the Taxes, Other Charges, Insurance Premiums and other expenses in connection with the Property, as well as just and reasonable compensation for the services
of Lender, its counsel, agents and employees; 

 (i) exercise any and all rights and remedies granted to a secured party upon default under the Uniform
Commercial Code, including, without limiting the generality of the foregoing: (i) the right to take possession of the Personal Property and other UCC Collateral or any part thereof, and to take such other measures as Lender may deem necessary for
the care, protection and preservation of the Personal Property and other UCC Collateral, and (ii) request Borrower at its expense to assemble the Personal Property and other UCC Collateral and make it available to Lender at a convenient place
acceptable to Lender. Any notice of sale, disposition or other intended action by Lender with respect to the Personal Property and other UCC Collateral sent to Borrower in accordance with the provisions hereof at least five (5) days prior to such
action, shall constitute commercially reasonable notice to Borrower; 
  
 (j) apply any sums held in escrow or otherwise by Lender in accordance with the terms of this Security Instrument or any Other Security Document to the payment of the following items in any order in its sole discretion: 
  
 (i) Taxes and Other Charges; 
  
 (ii) Insurance Premiums; 
  
 (iii) interest on the unpaid principal balance of the Note;

  
 (iv) amortization of the unpaid principal
balance of the Note; and 
  
 (v) all other sums
payable pursuant to the Note, this Security Instrument and the Other Security Documents, including, without limitation, advances made by Lender pursuant to the terms of this Security Instrument; 
  
 (k) surrender the Policies maintained pursuant to Article 3 hereof, collect
the unearned Insurance Premiums and apply such sums as a credit on the Debt in such priority and proportion as Lender in its discretion shall deem proper, and in connection therewith, Borrower hereby appoints Lender as agent and attorney-in-fact
(which is coupled with an interest and is therefore irrevocable) for Borrower to collect such unearned Insurance Premiums; 
  
 (l) apply the balance of any Net Proceeds Deficiency deposit, together with interest thereon, to the payment of the Debt in such order, priority and
proportions as Lender shall deem to be appropriate in its discretion; or 
  
 (m) pursue such other remedies as Lender may have under applicable state or federal law. 
  
 In the event of a sale pursuant to this Section 11.1, by foreclosure, power of sale, or otherwise, of less than all of the Property, this Security
Instrument shall continue as a lien and security interest on the remaining portion of the Property unimpaired and without loss of priority. Notwithstanding the provisions of this Section 11.1 to the contrary, if any Event of Default as described in
Section 7.1(h) or Section 7.1(i) of the Credit Agreement shall occur, the entire 

 
unpaid Debt shall be automatically due and payable, without any further notice, demand or other action by Lender. 
  
 Section 11.2 APPLICATION OF PROCEEDS. The purchase money, proceeds and
avails of any disposition of the Property, or any part thereof, or any other sums collected by Lender pursuant to the Note, this Security Instrument or the Other Security Documents, may be applied by Lender to the payment of the Debt in such
priority and proportions as Lender in its discretion shall deem proper. 
  
 Section 11.3 RIGHT TO CURE DEFAULTS. Upon the occurrence of any Event of Default or if Borrower fails to make any payment or to do any act as herein provided, upon notice to Borrower (except in an emergency situation to protect the
security hereof), Lender may, but without any obligation to do so and without releasing Borrower from any obligation hereunder, make or do the same in such manner and to such extent as Lender may deem necessary to protect the security hereof. Lender
is authorized to enter upon the Property for such purposes, or appear in, defend, or bring any action or proceeding to protect its interest in the Property or to foreclose this Security Instrument or collect the Debt. The cost and expense of any
cure hereunder (including reasonable legal fees to the extent permitted by law), with interest as provided in this Section 11.3, shall constitute a portion of the Debt and shall be due and payable to Lender upon demand. All such costs and expenses
incurred by Lender in remedying such Event of Default or such failed payment or act or in appearing in, defending, or bringing any such action or proceeding shall bear interest at the Default Rate, for the period after notice from Lender that such
cost or expense was incurred to the date of payment to Lender. All such costs and expenses incurred by Lender together with interest thereon calculated at the Default Rate (defined in the Note) shall be deemed to constitute a portion of the Debt and
be secured by this Security Instrument and the Other Security Documents and shall be immediately due and payable upon demand by Lender therefor. 
  
 Section 11.4 ACTIONS AND PROCEEDINGS. With notice to Borrower, Lender has the right to appear in and defend any action or proceeding brought with
respect to the Property and, after the occurrence and during the continuance of an Event of Default, to bring any action or proceeding, in the name and on behalf of Borrower, which Lender, in its discretion, decides should be brought to protect its
interest in the Property. 
  
 Section 11.5 RECOVERY OF SUMS
REQUIRED TO BE PAID. Lender shall have the right from time to time to take action to recover any sum or sums which constitute a part of the Debt as the same become due, without regard to whether or not the balance of the Debt shall be due, and
without prejudice to the right of Lender thereafter to bring an action of foreclosure, or any other action, for a default or defaults by Borrower existing at the time such earlier action was commenced. 
  
 Section 11.6 EXAMINATION OF BOOKS AND RECORDS. Lender, its agents,
accountants and attorneys shall have the right upon prior written notice to Borrower (unless an Event of Default exists, in which case no notice shall be required), to examine and audit, during reasonable business hours, the records, books,
management and other papers of Borrower and its Subsidiaries (as defined in the Credit Agreement) which pertain to their financial condition or the 

 
income, expenses and operation of the Property, at the Property or at any office regularly maintained by Borrower or its Subsidiaries where the books and
records are located. Lender and its agents shall have the right upon notice to make copies and extracts from the foregoing records and other papers. 
  
 Section 11.7 OTHER RIGHTS, ETC. 
  
 (a) The failure of Lender to insist upon strict performance of any tenn hereof shall not be deemed to be a waiver of any term of this Security Instrument.
Borrower shall not be relieved of Borrower’s obligations hereunder by reason of (i) the failure of Lender to comply with any request of Borrower to take any action to foreclose this Security Instrument or otherwise enforce any of the provisions
hereof or of the Note or the Other Security Documents, (ii) the release, regardless of consideration, of the whole or any part of the Property, or of any person liable for the Debt or any portion thereof, or (iii) any agreement or stipulation by
Lender extending the time of payment, changing the rate of interest, or otherwise modifying or supplementing the terms of the Note, this Security Instrument or the Other Security Documents. 
  
 (b) It is agreed that the risk of loss or damage to the Property is on
Borrower, and Lender shall have no liability whatsoever for decline in value of the Property, for failure to maintain the Policies, or for failure to determine whether insurance in force is adequate as to the amount of risks insured. Possession by
Lender shall not be deemed an election of judicial relief, if any such possession is requested or obtained, with respect to any Property or collateral not in Lender’s possession. 
  
 (c) Lender may resort for the payment of the Debt to any other security held by Lender in such order and manner as Lender,
in its discretion, may elect. Lender may take action to recover the Debt, or any portion thereof, or to enforce any covenant hereof without prejudice to the right of Lender thereafter to foreclose this Security Instrument. The rights of Lender under
this Security Instrument shall be separate, distinct and cumulative and none shall be given effect to the exclusion of the others. No act of Lender shall be construed as an election to proceed under any one provision herein to the exclusion of any
other provision. Lender shall not be limited exclusively to the rights and remedies herein stated but shall be entitled to every right and remedy now or hereafter afforded at law or in equity. 
  
 Section 11.8 RIGHT TO RELEASE ANY PORTION OF THE PROPERTY. Lender may
release any portion of the Property for such consideration as Lender may require without, as to the remainder of the Property, in any way impairing or affecting the lien or priority of this Security Instrument, or improving the position of any
subordinate lienholder with respect thereto, except to the extent that the obligations hereunder shall have been reduced by the actual monetary consideration, if any, received by Lender for such release, and may accept by assignment, pledge or
otherwise any other property in place thereof as Lender may require without being accountable for so doing to any other lienholder. This Security Instrument shall continue as a lien and security interest in the remaining portion of the Property.

  
 Section 11.9 VIOLATION OF LAWS. If the Property is not
in material compliance with Applicable Laws, Lender may impose additional requirements upon Borrower in connection 

 
herewith including, without limitation, monetary reserves or financial equivalents reasonably related to the non-compliance. 
  
 Section 11.10 RIGHT OF ENTRY. Lender and its agents shall have the
right to enter and inspect the Property at all reasonable times upon reasonable notice. 
  
 Section 11.11 SUBROGATION. If any or all of the proceeds of the Note have been used to extinguish, extend or renew any indebtedness heretofore existing against the Property, then, to the extent of the funds so
used, Lender shall be subrogated to all of the rights, claims, liens, titles, and interests existing against the Property heretofore held by, or in favor of, the holder of such indebtedness and such former rights, claims, liens, titles, and
interests, if any, are not waived but rather are continued in full force and effect in favor of Lender and are merged with the lien and security interest created herein as cumulative security for the repayment of the Debt, the performance and
discharge of Borrower’s obligations hereunder, under the Note and the Other Security Documents and the performance and discharge of the Other Obligations. 
  

Section 11.12 POWER OF ATTORNEY. 
  
 (a) The Borrower hereby irrevocably constitutes and appoints the Lender and any officer or agent thereof, with full power of substitution, as its true and
lawful attorneys-in-fact with full irrevocable power and authority in the place and stead purpose of the Borrower or in the Lender’s own name, for the purposes of carrying out the terms of this Security Instrument, to take any and all
appropriate action and to execute any and all documents and instruments that may be necessary or useful to accomplish the purposes of this Security Instrument and, without limiting the generality of the foregoing, hereby gives said attorneys the
power and right, on behalf of the Borrower, upon notice to the Borrower, to, upon the occurrence and during the continuance of an Event of Default, sell, transfer, pledge, make any agreement with respect to or otherwise dispose of or deal with any
of the Property in such manner as is consistent with the Uniform Commercial Code and as fully and completely as though the Lender were the absolute owner thereof for all purposes, and to do, at the Borrower’s expense, at any time, or from time
to time, all acts and things which the Lender deems necessary or usefull to protect, preserve or realize upon the Property and the Lender’s security interest therein, in order to effect the intent of this Security Instrument, all no less fully
and effectively as the Borrower might do; and 
  
 (b) To the
extent permitted by law, the Borrower hereby ratifies all that said attorneys shall lawfully do or cause to be done by virtue hereof. This power of attorney is a power coupled with an interest and is irrevocable. 
  
 (c) The powers conferred on the Lender hereunder are solely to protect its
interests in the Property and shall not impose any duty upon it to exercise any such powers. The Lender shall be accountable only for the amounts that it actually receives as a result of the exercise of such powers, and neither it nor any of its
officers, directors, employees or agents shall be responsible to the Borrower for any act or failure to act. 

 Article 12 - ENVIRONMENTAL HAZARDS 
  
 Section 12.1 ENVRONMENTAL REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants that: (a) there are no
Hazardous Materials (defined below) or underground storage tanks in, on, or under the Property, except those that are both (i) in compliance with Environmental Laws and with permits issued pursuant thereto (if such permits are required), and (ii)
either (A) in amounts not in excess of that necessary to operate the Property or (B) fully disclosed in writing pursuant to the written reports resulting from the environmental site assessments of the Property delivered to Lender prepared by
Commercial Property ESA Program (the “Environmental Report”); (b) there are no known past, present or threatened Releases (defined below) of Hazardous Materials in violation of any Environmental Law and which would require remediation by a
governmental authority in, on, under or from the Property except as described in the Environmental Report; (c) there is no known threat of any Release of Hazardous Materials migrating to the Property except as described in the Environmental Report;
(d) there is no known past or present non-compliance with Environmental Laws, or with permits issued pursuant thereto, in connection with the Property except as described in the Environmental Report; (e) Borrower does not know of, and has not
received, any written or oral notice or other communication from any person or entity (including but not limited to a governmental entity) relating to Hazardous Materials in, on, under or from the Property; and (f) Borrower has truthfully and fully
provided to Lender, in writing, any and all information relating to environmental conditions in, on, under or from the Property known to Borrower or contained in Borrower’s files and records, including but not limited to any reports relating to
Hazardous Materials in, on, under or migrating to or from the Property and/or to the environmental condition of the Property. “Environmental Law” means any present and future federal, state and local laws, statutes, ordinances, rules,
regulations, standards, policies and other government directives or requirements, as well as common law, that apply to Borrower or the Property and relate to Hazardous Materials, including, without limitation, the Comprehensive Environmental
Response, Compensation and Liability Act and the Resource Conservation and Recovery Act. “Hazardous Materials” shall mean petroleum and petroleum products and compounds containing them, including gasoline, diesel fuel and oil; explosives;
flammable materials; radioactive materials; polychlorinated biphenyls and compounds containing them; lead and lead-based paint; asbestos or asbestos-containing materials in any form that is or could become friable; underground or above-ground
storage tanks, whether empty or containing any substance; any substance the presence of which on the Property is prohibited by any federal, state or local authority; any substance that requires special handling; and any other material or substance
now or in the future defined as a “hazardous substance,” “hazardous material,” “hazardous waste,” “toxic substance,” “toxic pollutant,” “contaminant,” “pollutant” or other words
of similar import within the meaning of any Environmental Law. “Release” of any Hazardous Materials includes but is not limited to any release, deposit, discharge, emission, leaking, spilling, seeping, migrating, injecting, pumping,
pouring, emptying, escaping, dumping, disposing or other movement of Hazardous Materials. 
  
 Section 12.2 ENVIRONMENTAL COVENANTS. Borrower covenants and agrees that so long as Borrower owns, manages, is in possession of, or otherwise controls the operation of the Property: (a) all uses and operations
on or of the Property, whether by Borrower or any other person or entity, shall be in compliance, in all material respects, with all Environmental Laws and permits issued pursuant thereto; (b) there shall be no Releases of Hazardous Materials in,
on, under or from the Property; (c) there shall be no Hazardous Materials in, on, or under the Property, except those that arc both (i) in compliance with all Environmental Laws and with 

 
permits issued pursuant thereto, if and to the extent required, and (ii) (A) in amounts not in excess of that necessary to operate the Property or (B) fully
disclosed to and approved by Lender in writing; (d) Borrower shall keep the Property free and clear of all liens and other encumbrances imposed pursuant to any Environmental Law, whether due to any act or omission of Borrower or any other person or
entity (the “Environmental Liens”); (e) Borrower shall, at its sole cost and expense, fully and expeditiously cooperate in all activities pursuant to Section 12.3 below, including but not limited to providing all relevant information and
making knowledgeable persons available for interviews; (f) Borrower shall, at its sole cost and expense, perform any environmental site assessment or other investigation of environmental conditions in connection with the Property, pursuant to any
reasonable written request of Lender, upon Lender’s reasonable belief that the Property is not in compliance (in all material respects) with all Environmental Laws, and share with Lender the reports and other results thereof, and Lender and
other Indemnified Parties hereinafter defined shall be entitled to rely on such reports and other results thereof; (g) Borrower shall, at its sole cost and expense, comply with all reasonable written requests of Lender to (i) reasonably effectuate
remediation of any Hazardous Materials in, on, under or from the Property; and (ii) comply with any Environmental Law; (h) Borrower shall not allow any tenant or other user of the Property to violate any Environmental Law; and (i) Borrower shall
immediately notify Lender in writing after it has become aware of (A) any presence or Release or threatened Release of Hazardous Materials in, on, under, from or migrating towards the Property; (B) any material non-compliance with any Environmental
Laws related in any way to the Property; (C) any actual or potential Environmental Lien against the Property; (D) any required or proposed remediation of environmental conditions relating to the Property; and (E) any written or oral notice or other
communication of which Borrower becomes aware from any source whatsoever (including but not limited to a governmental entity) relating in any way to Hazardous Materials. 
  
 Section 12.3 LENDER’S RIGHTS. Lender and any other person or entity designated by Lender, including but not
limited to any representative of a governmental entity, and any environmental consultant, and any receiver appointed by any court of competent jurisdiction, shall have the right, but not the obligation upon Lender’s reasonable belief that any
one of the covenants set forth in Section 12.2 have not been complied with, to enter upon the Property at all reasonable times, after reasonable notice, to assess any and all aspects of the environmental condition of the Property and its use,
including but not limited to conducting any environmental assessment or audit (the scope of which shall be determined in Lender’s sole and absolute discretion) and taking samples of soil, groundwater or other water, air, or building materials,
and conducting other invasive testing. Borrower shall cooperate with and provide access to Lender and any such person or entity designated by Lender. 
  
 Article 13 - INDEMNIFICATIONS 
  
 Section 13.1 GENERAL INDEMNIFICATION. Borrower shall, at its sole cost and expense, protect, defend, indemnify, release and hold harmless Lender,
its affiliates, and each of their officers, directors, employees, agents and advisors (the “Indemnified Parties) from and against any and all Losses (defined below) imposed upon or incurred by or asserted against any Indemnified Parties and
directly or indirectly arising out of or in any way relating to any one or more of the following: (a) any accident, injury to or death of persons or loss of or damage to 

 
property occurring in, on or about the Property or any part thereof or on the adjoining sidewalks, curbs, adjacent property or adjacent parking areas,
streets or ways; (b) any use, nonuse or condition in, on or about the Property or any part thereof or on the adjoining sidewalks, curbs, adjacent property or adjacent parking areas, streets or ways; (c) performance of any labor or services or the
furnishing of any materials or other property in respect of the Property or any part thereof; (d) any failure of the Property to be in compliance with any Applicable Laws; (e) any and all claims and demands whatsoever which may be asserted against
Lender by reason of any alleged obligations or undertakings on its part to perform or discharge any of the terms, covenants, or agreements contained in any Lease; or (1) the payment of any commission, charge or brokerage fee to anyone which may be
payable in connection with the funding of the Loan evidenced by the Note and secured by this Security Instrument. Any amounts payable to Lender by reason of the application of this Section 13.1 shall become immediately due and payable and shall bear
interest at the Default Rate from the date loss or damage is sustained by Lender until paid. 
  
 The term “Losses” shall mean any and all claims, suits, liabilities (including, without limitation, strict liabilities), actions, proceedings, obligations, debts, damages, losses, costs, expenses, fines,
penalties, charges, fees, judgments, awards, amounts paid in settlement of whatever kind or nature (including but not limited to legal fees and other costs of defense). 
  
 Section 13.2 MORTGAGE AND/OR INTANGIBLE TAX. Borrower shall, at its sole cost and expense, protect, defend,
indemnify, release and hold harmless the Indemnified Parties from and against any and all Losses imposed upon or incurred by or asserted against any Indemnified Parties and directly or indirectly arising out of or in any way relating to any tax on
the making and/or recording of this Security Instrument, the Note or any of the Other Security Documents. 
  
 Section 13.3 DUTY TO DEFEND, LEGAL FEES AND OTHER FEES AND EXPENSES. Upon written request by any Indemnified Party, Borrower shall defend such
Indemnified Party (if requested by any Indemnified Party, in the name of the Indemnified Party) by attorneys and other professionals approved by the Indemnified Parties. Notwithstanding the foregoing, any Indemnified Parties may, in their sole
discretion, engage their own attorneys and other professionals to defend or assist them, and, at the option of Indemnified Parties, their attorneys shall control the resolution of any claim or proceeding. Upon demand, Borrower shall pay or, in the
sole discretion of the Indemnified Parties, reimburse, the Indemnified Parties for the payment of reasonable fees and disbursements of attorneys, engineers, environmental consultants, laboratories and other professionals in connection therewith.

  
 Section 13.4 ENVIRONMENTAL INDEMNITY. Simultaneously
with this Security Instrument, Borrower has executed and delivered that certain environmental indemnity agreement dated the date hereof to Lender (the ‘Environmental Indemnity”), which Environmental Indemnity is not secured by this
Security Instrument. 

 Article 14 - WAIVERS 
  
 Section 14.1 WAIVER OF COUNTERCLAIM. Borrower hereby waives the right to assert a counterclaim, other than a
mandatory or compulsory counterclaim, in any action or proceeding brought against it by Lender arising out of or in any way connected with this Security Instrument, the Note, the Credit Agreement, any of the Other Security Documents, or the
Obligations. 
  
 Section 14.2 MARSHALLING AND OTHER
MATTERS. Borrower hereby waives, to the extent permitted by law, the benefit of all appraisement, valuation, stay, extension, reinstatement and redemption laws now or hereafter in force and all rights of marshalling in the event of any sale
hereunder of the Property or any part thereof or any interest therein. Further, Borrower hereby expressly waives any and all rights of redemption from sale under any order or decree of foreclosure of this Security Instrument on behalf of Borrower,
and on behalf of each and every person acquiring any interest in or title to the Property subsequent to the date of this Security Instrument and on behalf of all persons to the extent permitted by Applicable Law. 
  
 Section 14.3 WAIVER OF NOTICE. Borrower shall not be entitled to any
notices of any nature whatsoever from Lender except (a) with respect to matters for which this Security Instrument specifically and expressly provides for the giving of notice by Lender to Borrower and (b) with respect to matters for which Lender is
required by Applicable Law to give notice, and Borrower hereby expressly waives the right to receive any notice from Lender with respect to any matter for which this Security Instrument does not specifically and expressly provide for the giving of
notice by Lender to Borrower. 
  
 Section 14.4 WAIVER OF
STATUTE OF LIMITATIONS. Borrower hereby expressly waives and releases to the fullest extent permitted by law, the pleading of any statute of limitations as a defense to payment of the Debt or performance of its Other Obligations. 
  
 Section 14.5 SOLE DISCRETION OF LENDER. Wherever pursuant to this
Security Instrument (a) Lender exercises any right given to it to approve or disapprove, (b) any arrangement or term is to be satisfactory to Lender, or (c) any other decision or determination is to be made by Lender, the decision to approve or
disapprove all decisions that arrangements or terms are satisfactory or not satisfactory, and all other decisions and determinations made by Lender, shall be in the sole discretion of Lender, except as may be otherwise expressly and specifically
provided herein. 
  
 Section 14.6 WAIVER OF TRIAL BY JURY.
BORROWER AND LENDER, BY ACCEPTANCE OF THIS SECURITY INSTRUMENT, HEREBY WAIVE, TO THE FULLEST EXTENT PERMITTED BY LAW, THE RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM, WHETHER IN CONTRACT, TORT OR OTHERWISE, RELATING DIRECTLY OR
INDIRECTLY TO THE LOAN, THE APPLICATION FOR THE LOAN, THE NOTE, THIS SECURITY INSTRUMENT OR THE OTHER SECURITY DOCUMENTS OR ANY ACTS OR OMISSIONS OF LENDER OR BORROWER. 
  
 Section 14.7 WAIVER OF FORECLOSURE DEFENSE. Borrower hereby waives any defense Borrower might assert or have by
reason of Lender’s failure to make any tenant or lessee of the Property a party defendant in any foreclosure proceeding or action instituted by Lender. 

 Article 15 - SPECIAL 
 MASSACHUSETTS PROVISIONS 
  
 Section 15.1 INCONSISTENCIES. In the event of any inconsistency between the terms and conditions of the other articles and provisions of this Security Instrument and this Article 15, the terms and conditions of this Article 15 shall
control and be binding. 
  
 Section 15.2 MORTGAGE
COVENANTS. The second line of the first full paragraph of Section 1.1 of this Security Instrument shall be modified such that the words, “with MORTGAGE COVENANTS”, shall be inserted following the words “to Lender”.

  
 Section 15.3 POWER OF SALE. The following paragraph
shall be added to this Security Instrument: 
  
 This Security
Instrument is upon the statutory condition and upon the further condition that all covenants and agreement of the Borrower contained herein and in the Note and in every other Loan Document executed in connection therewith shall be kept and fully
performed and for any breach of which the Lender shall have the statutory power of sale. In exercising its power of sale under this Security Instrument, the Lender may sell the Personal Property or any part thereof, either separately from or
together with the Land or any part thereof, either as one unit or as separate units, all as the Lender may, in its discretion elect; and may also sell the Land as one unit or parcel or in such separate units or parcels as the Lender may in its sole
discretion elect; and may so sell the Land or any part thereof, either separately from or together with, the whole or any part of the other Property, as Lender may, in its sole discretion, elect. 
  
 Article 16 - NOTICES 
  
 Section 16.1 NOTICES. All notices or other written communications
hereunder shall be given in accordance with the terms of the Credit Agreement. 
  
 Article 17 - CHOICE OF LAW/SUBMISSION TO JURISDICTION 
  
 Section 17.1 CHOICE OF LAW. This Security Instrument shall be deemed to be a contract entered into pursuant to the laws of the State of New York and shall in all respects be governed, construed, applied and
enforced in accordance with the laws of the State of New York, provided however, that with respect to the creation, perfection, priority and enforcement of the lien of this Security Instrument, and the determination of deficiency judgments, the laws
of the state where the Property is located shall apply. 
  
 Section 17.2 PROVISIONS SUBJECT TO LAW. All rights, powers and remedies provided in this Security Instrument may be exercised only to the extent that the exercise thereof does not violate any applicable state or federal law and are
intended to be limited to the extent necessary so that they will not render this Security Instrument invalid, unenforceable or not entitled to be recorded, registered or filed under any applicable state or federal law. 

 Section 17.3 SUBMISSION TO JURISDICTION. With respect to any claim or action arising hereunder or
under the Note, the Credit Agreement or the Other Security Documents, Borrower (a) irrevocably submits to the nonexclusive jurisdiction of the courts of the State of New York and the United States District Court located in the City of New York, in
the State of New York, and appellate courts from any thereof, (b) irrevocably waives any objection which it may have at any time to the laying on venue of any suit, action or proceeding arising out of or relating to this Security Instrument brought
in any such court, and (c) irrevocably waives any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. Nothing in this Security Instrument will be deemed to preclude Lender from bringing
an action or proceeding with respect hereto in any other jurisdiction. 
  
 Article 18 - SECONDARY MARKET 
  
 Section 18.1
TRANSFER OF LOAN. Lender may, at any time, sell, transfer or assign the Note, the Credit Agreement, this Security Instrument and the Other Security Documents, and any or all servicing rights with respect thereto, or grant participations
therein (the “Participations”) or issue mortgage pass-through certificates or other securities evidencing a beneficial interest in a rated or unrated public offering or private placement (the “Securities”). Lender may forward to
each purchaser, transferee, assignee, servicer, participant, or investor in such Participations or Securities (collectively, the “Investor”) or any Rating Agency rating such Securities, each prospective Investor, and any organization
maintaining databases on the underwriting and performance of commercial mortgage loans, all documents and information which Lender now has or may hereafter acquire relating to the Debt, the Borrower or the Property, whether furnished by Borrower or
otherwise, as Lender determines necessary or desirable, provided that such Investor, prospective Investor or Rating Agency is informed that such information is confidential and agrees to maintain its confidentiality and not to use such information
other than to evaluate a potential purchase of an interest in the Loan (as such term is defined in the Credit Agreement). Borrower irrevocably waives any and all rights it may have under Applicable Laws to prohibit such disclosure, including but not
limited to any right of privacy. 
  
 Section 18.2
COOPERATION. Borrower agrees to cooperate with Lender in connection with any transfer made or any Securities created pursuant to this Section, including, without limitation, the delivery of an estoppel certificate required in accordance with
Section 7.4(c) hereof and such other documents as may be reasonably requested by Lender. Borrower shall also furnish and Borrower consents to Lender furnishing to such Investors or such prospective Investors or such Rating Agency any and all
information concerning the Property, the Leases, the financial condition of Borrower as may be requested by Lender, any Investor, any prospective Investor or any Rating Agency in connection with any sale, transfer, Participations or Securities,
provided that such Investor, prospective Investor or Rating Agency is informed that such information is confidential and agrees to maintain its confidentiality and not to use such information other than to evaluate a potential purchase of an
interest in the Loan (as such term is defined in the Credit Agreement). 
  
 Section 18.3 RESERVES/ESCROWS. In the event that Securities are issued in connection with the Loan, all funds held by Lender in escrow or pursuant to reserves in 

 
accordance with this Security Instrument or the Other Security Documents shall be deposited in eligible accounts at eligible institutions as then defined and
required by the Rating Agencies. 
  
 Article 19 - COSTS

  
 Section 19.1 PERFORMANCE AT BORROWER’S
EXPENSE. Borrower acknowledges and confirms that Lender shall impose certain administrative processing and/or commitment fees in connection with (a) the extension, renewal, modification, amendment and termination of the Loan, (b) the release or
substitution of collateral therefor, (c) obtaining certain consents, waivers and approvals with respect to the Property, or (d) the review of any Lease or proposed Lease or the preparation or review of any subordination, non-disturbance agreement
(the occurrence of any of the above shall be called an “Event”). Borrower further acknowledges and confirms that it shall be responsible for the payment of all costs of reappraisal of the Property or any part thereof, required by law,
regulation, Lender (upon the occurrence of an Event of Default or if the Property shall be destroyed in whole or in part) or any governmental or quasi-governmental authority. Borrower hereby acknowledges and agrees to pay, immediately, with or
without demand, all such fees (as the same may be increased or decreased from time to time), and any additional fees of a similar type or nature which may be imposed by Lender from time to time, upon the occurrence of any Event or otherwise.
Wherever it is provided for herein that Borrower pay any costs and expenses, such costs and expenses shall include, but not be limited to, all reasonable legal fees of Lender. 
  
 Section 19.2 LEGAL FEES FOR ENFORCEMENT. (a) Borrower shall pay all reasonable legal fees incurred by Lender in
connection with (i) the preparation of the Note, the Credit Agreement, this Security Instrument and the Other Security Documents; and (ii) the items set forth in Section 19.1 above, and (b) Borrower shall pay to Lender on demand any and all
expenses, including legal fees incurred or paid by Lender in protecting its interest in the Property or in collecting any amount payable under the Note, the Credit Agreement, this Security Instrument or the Other Security Documents, or in enforcing
its rights hereunder with respect to the Property, whether or not any legal proceeding is commenced hereunder or thereunder, together with interest thereon at the Default Rate from the date paid or incurred by Lender until such expenses are paid by
Borrower. 
  
 Article 20 - DEFINITIONS 
  
 Section 20.1 GENERAL DEFINITIONS. Unless the context clearly indicates
a contrary intent or unless otherwise specifically provided herein, words used in this Security Instrument may be used interchangeably in singular or plural form and the words “Applicable Laws” shall mean all existing and future federal,
state and local laws, orders, ordinances, governmental rules and regulations and court orders and the word “Borrower” shall mean “each Borrower and any subsequent owner or owners of the Property or any part thereof or any interest
therein,” the word “Lender” shall mean “Lender and any subsequent holder of the Note,” the word “Note” shall mean “the Note and any other evidence of indebtedness secured by this Security Instrument,” the
word “person” shall include an individual, corporation, limited liability company, partnership, trust, unincorporated association, government, governmental authority, and any other entity, the word “Property” shall include any
portion of the Property and any interest therein, and the phrase “legal fees” and “counsel fees” shall include any and all 

 
reasonable counsel, attorney, paralegal and law clerk fees and disbursements, including, but not limited to fees and disbursements at the pre-trial, trial
and appellate levels incurred or paid by Lender in protecting its interest in the Property, the Leases and the Rents and enforcing its rights hereunder, whether with respect to retained firms the reimbursement for the expenses of in-house staff or
otherwise. 
  
 Section 20.2 HEADINGS, ETC. The headings and
captions of various Articles and Sections of this Security Instrument are for convenience of reference only and arc not to be construed as defining or limiting, in any way, the scope or intent of the provisions hereof. 
  
 Article 21 - MISCELLANEOUS PROVISIONS 
  
 Section 21.1 NO ORAL CHANGE. This Security Instrument, and any
provisions hereof, may not be modified, amended, waived, extended, changed, discharged or terminated orally or by any act or. failure to act on the part of Borrower or Lender, but only by an agreement in writing signed by the party against whom
enforcement of any modification, amendment, waiver, extension, change, discharge or termination is sought. 
  
 Section 21.2 LIABILITY. This Security Instrument shall be binding upon and inure to the benefit of Borrower and Lender and their respective
successors and assigns forever. 
  
 Section 21.3 INAPPLICABLE
PROVISIONS. If any term, covenant or condition of the Note, the Credit Agreement, or this Security Instrument is held to be invalid, illegal or unenforceable in any respect, the Note, the Credit Agreement and this Security Instrument shall be
construed without such provision. 
  
 Section 21.4 DUPLICATE
ORIGINALS; COUNTERPARTS. This Security Instrument may be executed in any number of duplicate originals and each duplicate original shall be deemed to be an original. This Security Instrument may be executed in several counterparts, each of which
counterparts shall be deemed an original instrument and all of which together shall constitute a single Security Instrument. The failure of any party hereto to execute this Security Instrument, or any counterpart hereof, shall not relieve the other
signatories from their obligations hereunder. 
  
 Section
21.5 NUMBER AND GENDER. Whenever the context may require, any pronouns used herein shall include the corresponding masculine, feminine or neuter forms, and the singular form of nouns and pronouns shall include the plural and vice versa.

  
 [NO FURTHER TEXT ON THIS PAGE] 

 IN WITNESS WHEREOF, this Security Instrument has been executed by Borrower the day and year first above
written. 
  

					
	 CYBEX INTERNATIONAL, INC.

		
	By:	 	 

					
	 	 	 Name:
	 	 Arthur W. Hicks, Jr.

	 	 	 Title:
	 	 Vice President; Chief Financial Officer

 ACKNOWLEDGMENT 
  

					
	 COMMONWEALTH OF MASSACHUSETTS
	  	)	  	 
	 	  	) SS:	  	 
	 ____________________, COUNTY
	  	)	  	July _____, 2004

  
 The personally
appeared before me the above named ARTHUR W. HICICS, JR., to me personally known, who, being duly sworn, did say that he is the Vice President and Chief Financial Officer, of CYBEX INTERNATIONAL, INC., a New York corporation, and that the Foregoing
instrument was signed and sealed on behalf of said corporation by authority of its Board of Directors and acknowledged said instrument to be his free act and deed and that of said corporation. 
  

	
	
	 
	 Notary Public

	
	 My Commission Expires:

 EXHIBIT A 
  
 (Description of Land) 
  
 A certain parcel of land situated on the northerly side of Alder Street in Medway, Norfolk County, Massachusetts, together with any buildings thereon, being shown as Lot
1 on a plan entitled “Plan of Land for Highway Purposes in Medway, Mass” prepared by Gerald T. Carey, recorded wit the Norfolk County Registry of Deeds in Plan Book 304, Plan 664, more particularly described as follows: 
  
 SOUTHERLY by said Alder Street in three courses, a total of 767.21 feet, according to said
Plan; 
  
 WESTERLY by lands shown on said plan as of RIR Para Corp., and as
Conservation Area, in four courses measuring, respectively, 40.00 +/- feet, 65.30 +/- feet, 93.50 +/- feet and 728.42 feet, according to said plan; 
  
 NORTHWESTERLY by lands shown on said plan as Conservation Area, as of the Town of Medway, as the end of a private way, as now or
formerly of Pelkey and William, as the end of another private way, as of Carson, and as now or formerly of Hunter, in four courses, measuring respectively 91.49 feet, 465.80 feet, 275.56 feet and 183.89 feet according to said plan; 
  
 NORTHEASTERLY by land shown on said plan as of the Town of Medway, 188.93 feet, according to
said plan; and 
  
 EASTERLY by Lot 2 as shown on said plan in four courses,
measuring respectively 111 .27 feet, 135.21 feet, 104.34 feet and 1,191.43 feet, according to said plan. 
  
 Said parcel is also shown as Lot 1R and Lot 2R on a plan entitled “Plan of Land, Medway, Massachusetts” dated May 25, 2001, owner-applicant,
Cybex International. Prepared by GLM Engineering Consultants, Inc. to which plan reference is made for a more particular description. 
  
 Said plan is recorded at the Norfolk Registry of Deeds No. 335 of 2001 in Book 487. 

 EXHIBIT B-2 
 (Form of Real Property Security Instrument) 

 THIS INSTRUMENT WAS PREPARED BY: 
 THACHER PROFFITT & WOOD LLP 
  

  
 CYBEX INTERNATIONAL, INC., as
mortgagor 
 (Borrower) 
  
 to 
  
 GMAC COMMERCIAL FINANCE LLC, as mortgagee 
 (Lender) 
  

  
 MORTGAGE, ASSIGNMENT OF LEASES AND RENTS, 
 SECURITY AGREEMENT, FINANCING
STATEMENT 
 AND FIXTURE FILING 
  

  

			
	Dated:     	  	July 13, 2004
		
	Location:	  	 151 25th
Avenue
 Owatonna, MN

		
	County:  	  	Steele
		
	Tax Parcel Numbers:	  	 17-322-0205
 17-322-0206
 17-322-0207

  
 PREPARED BY AND UPON

 RECORDATION RETURN TO: 
  
 Thacher Proffitt & Wood, LLP 
 50 Main
Street, Suite 525 
 White Plains, New York 10606 
 Attention: Thomas J. Infurna, Esq. 
 File No.: 19601-00108 
  

 THIS INSTRUMENT WAS PREPARED BY: 
 THACHER PROFFITT & WOOD LLP 
  
 THIS MORTGAGE, ASSIGNMENT OF LEASES AND RENTS SECURITY AGREEMENT, FINANCING STATEMENT AND FIXTURE FILING (the “Security Instrument”) is made as
of the 13th day of July, 2004, by CYBEX INTERNATIONAL, INC., a corporation organized and existing under the laws of
the State of New York, with an address at 10 Trotter Drive, Medway, Massachusetts 11779, as mortgagor (“Borrower”) to GMAC COMMERCIAL FINANCE LLC, a Delaware limited liability company, having an office at 210 Interstate North Parkway,
Suite 315, Atlanta, Georgia 30339, as mortgagee (‘Lender”). 
  
 RECITALS: 
  
 Borrower by
its promissory notes of even date herewith given to Lender (to wit, a note in the principal sum of $11,000,000.00 and a note in the principal sum of $2,000,000.00) is indebted to Lender in the aggregate principal sum of $13,000,000.00 in lawful
money of the United States of America (the notes together with all extensions, renewals, modifications, substitutions and amendments thereof shall collectively be referred to as the “Note”), with interest from the date thereof at the rates
set forth in the Note, principal and interest to be payable in accordance with the terms and conditions provided in the Note, which Note is made pursuant to the terms of a certain Credit Agreement made by and between Borrower and Lender bearing even
date herewith (the credit agreement together with all extensions, renewals, modifications, substitutions and amendments thereof shall collectively be referred to as the “Credit Agreement”). 
  
 Borrower desires to secure the payment of the Debt (defined in Article 2) and
the performance of all of its obligations under the Note and the Other Obligations (defined in Article 2). 
  
 Article I - GRANTS OF SECURITY 
  
 Section 1.1 PROPERTY MORTGAGED. Borrower does hereby irrevocably mortgage, grant, bargain, sell, pledge, assign, warrant, transfer and convey to Lender, and grant a security interest to Lender in, the following
property, rights, interests and estates now owned, or hereafter acquired by Borrower (collectively, the “Property”): 
  
 (a) Land. The real property described in Exhibit A-I and A-2 attached hereto and made a part hereof (collectively, the “Land”);

  
 (b) Additional Land. All additional lands, estates and
development rights hereafter acquired by Borrower for use in connection with the Land and the development of the Land and all additional lands and estates therein which may, from time to time, by supplemental mortgage or otherwise be expressly made
subject to the lien of this Security Instrument; 
  
 (c)
Improvements. The buildings, structures, fixtures, additions, enlargements, extensions, modifications, repairs, replacements and improvements now or hereafter erected or located on the Land (the “Improvements”); 

 (d) Easements. All easements, rights-of-way or use, rights, strips and gores of land, streets,
ways, alleys, passages, sewer rights, water, water courses, water rights and powers, air rights and development rights, and all estates, rights, titles, interests, privileges, liberties, servitudes, tenements, hereditaments and appurtenances of any
nature whatsoever, in any way now or hereafter belonging, relating or pertaining to the Land and the Improvements and the reversion and reversions, remainder and remainders, and all land lying in the bed of any street, road or avenue, opened or
proposed, in front of or adjoining the Land, to the center line thereof and all the estates, rights, titles, interests, dower and rights of dower, curtesy and rights of curtesy, property, possession, claim and demand whatsoever, both at law and in
equity, of Borrower of, in and to the Land and the Improvements and every part and parcel thereof, with the appurtenances thereto; 
  
 (e) Fixtures and Personal Property. All Equipment (as such term is defined in the Uniform Commercial Code (defined below), including, without
limitation, materials handling equipment, communications equipment, computer equipment, and manufacturing equipment of every kind and nature whatsoever owned by Borrower, or in which Borrower has or shall have an interest (other than Inventory, as
such term is defined in the Uniform Commercial Code)) machinery (other than Inventory, as such term is defined in the Uniform Commercial Code) and fixtures (including, but not limited to, all heating, air conditioning, plumbing, lighting,
communications and elevator fixtures), office furniture, furnishings and trade fixtures, specialty tools and parts (constituting part of the equipment), in each case now or hereafter located upon the Land and the Improvements, or appurtenant
thereto, and all construction building equipment, materials and supplies of any nature whatsoever (expressly excluding any materials and supplies used in the manufacture of Inventory) owned by Borrower, or in which Borrower has or shall have an
interest, now or hereafter located upon the Land and the Improvements, or appurtenant thereto, and accessions thereof and renewals and replacements thereof and substitutions therefor together with Borrower’s interest in, and right to any and
all manuals, computer programs, software, databases and other materials relating to the use, mechanical/physical operation or structure of any of the foregoing (collectively, the “Personal Property”; it being agreed, however, that the term
“Personal Property” shall not include Inventory, Accounts, Deposit Accounts, Documents, General Intangibles (other than as set forth in Section 1.1(m) below), or Investment Property (as such terms are defined in the Uniform Commercial
Code)), including the right, title and interest of Borrower in and to any of the Personal Property which may be subject to any security interests, as defined in the Uniform Commercial Code, as adopted and enacted by the state or states where any of
the Property is located (the “Uniform Commercial Code”), superior in lien to the lien of this Security Instrument and all proceeds and products of all of the above; 
  
 (f) Leases and Rents. All leases, subleases and other agreements affecting the use, enjoyment or occupancy of the
Land and/or the Improvements heretofore or hereafter entered into and all extensions, amendments and modifications thereto (the “Leases”), whether before or after the filing by or against Borrower of any petition for relief under any laws
relating to bankruptcy or rights of creditors generally (“Creditors Rights Laws”) and all right, title and interest of Borrower, its successors and assigns therein and thereunder, including, without limitation, any guaranties of the
lessees’ obligations thereunder, cash or securities deposited 

 
thereunder to secure the performance by the lessees of their obligations thereunder and all rents, additional rents, revenues, issues and profits (including
all oil and gas or other mineral royalties and bonuses, but excluding any revenues and profits resulting from Inventory, Accounts, Deposit Accounts, Documents, General Intangibles (other than as set forth in Section 1.1(m) below), or Investment
Property) from the Land and the Improvements whether paid or accruing before or after the fifing by or against Borrower of any petition for relief under Creditors Rights Laws (the “Rents”) and all proceeds from the sale or other
disposition of the Leases and all sums paid or payable in consideration of or as a result of the termination of any Leases and the right to receive and apply the Rents to the payment of the Debt; 
  
 (g) Insurance Proceeds. All proceeds of and any unearned premiums on
any insurance policies covering the Land, the Improvements, the Personal Property and other collateral granted under this Section 1.1, including, without limitation, the right to receive and apply the proceeds of any insurance, judgments, or
settlements made in lieu thereof, for damage to the Property; 
  
 (h) Condemnation Awards. All awards or payments, including interest thereon, which may hereafter be made with respect to the Land, the Improvements, the Personal Property and other collateral granted under this Section 1.1, whether
from the exercise of the right of eminent domain (including, but not limited to any transfer made in lieu of or in anticipation of the exercise of the right), or for a change of grade, or for any other injury to or decrease in the value of the
Property; 
  
 (i) Tax Certiorari. All refunds, rebates or
credits hereafter arising in connection with a reduction in real estate taxes and assessments charged against the Land, the Improvements, the Personal Property and other collateral granted under this Section 1.1 as a result of tax certiorari or any
applications or proceedings for reduction; 
  
 (j)
Conversion. All proceeds of the conversion, voluntary or involuntary, of any of the foregoing including, without limitation, proceeds of insurance and condemnation awards, into cash or liquidation claims; 
  
 (k) Rights. The right, in the name and on behalf of Borrower, to
appear in and defend any action or proceeding brought with respect to the Property and to commence any action or proceeding to protect the interest of Lender in the Land, the Improvements, the Personal Property and other collateral granted under
this Section 1.1; 
  
 (1) Agreements. All agreements,
contracts, certificates, instruments, franchises, permits, licenses, plans, specifications and other documents, now or hereafter entered into, and all rights therein and thereto, respecting or pertaining to the use, occupation, construction,
management or mechanical/physical operation of the Land and any part thereof (but excluding any such documents relating to Inventory or the conversion of Inventory into finished product, Accounts, Deposit Accounts, Documents, General Intangibles
(other than as set forth in Section 1.1(m) below), or Investment Property) and any Improvements, and all right, title and interest of Borrower therein and thereunder, including, without limitation, the right, upon the occurrence and during the
continuance of an Event of Default (defined in Article 10 ), to receive and collect any sums payable to Borrower thereunder; 

 (m) Intangibles. All books and records and all other general intangibles relating to or used in
connection with the mechanical/physical operation of the Land, the Improvements and the Personal Property (but excluding any general intangibles relating to Inventory or the conversion of Inventory into finished product, Accounts, Deposit Accounts,
Documents, Investment Property or intellectual property); and 
  
 (n) Other Rights. Any and all other rights of Borrower in and to the items set forth in Subsections (a) through (m) above. 
  
 Section 1.2 ASSIGNMENT OF LEASES AND RENTS. Borrower hereby absolutely and unconditionally assigns to Lender Borrower’s right, title and
interest in and to all current and future Leases and Rents; it being intended by Borrower that this assignment constitutes a present, absolute assignment and not an assignment for additional security only. Nevertheless, subject to the terms of this
Section 1.2 and Section 3.8 and Section 11.1(h), Lender grants to Borrower a revocable license to collect and receive the Rents. Borrower shall hold a portion of the Rents sufficient to discharge all current sums due on the Debt, for use in the
payment of such sums. 
  
 Section 1.3 SECURITY AGREEMENT.
This Security Instrument is both a real property mortgage and a “security agreement” within the meaning of the Uniform Commercial Code. The Property includes both real and personal property and all other rights and interests, whether
tangible or intangible in nature, of Borrower in the Property. By executing and delivering this Security Instrument, Borrower hereby grants to Lender, as security for the Obligations (defined in Section 2.3), a security interest in the Personal
Property and other collateral given as security for the Obligations (whether denominated as part of the Property or otherwise) to the extent that under applicable law the same would be governed by the Uniform Commercial Code (collectively, “UCC
Collateral”) to the full extent that the Personal Property and other UCC Collateral may be subject to the Uniform Commercial Code. 
  
 Section 1.4 PLEDGE OF MONIES HELD. Borrower hereby pledges to Lender any and all monies now or hereafter held by Lender, including, without
limitation, Net Proceeds (defined in Section 3.7), as additional security for the Obligations until expended or applied as provided in this Security Instrument. 
  

Section 1.5 CONDITIONS TO GRANT. TO HAVE AND TO HOLD the above granted and described Property to the use and benefit of Lender, and the
successors and assigns of Lender, forever; 
  
 PROVIDED, HOWEVER,
these presents are upon the express condition that, if Borrower shall pay to Lender the Debt at the time and in the manner provided in the Note and this Security Instrument and shall perform the Other Obligations as set forth in this Security
Instrument, these presents and the estate hereby granted shall cease, terminate and be void. 
  
 Article 2 - DEBT AND OBLIGATIONS SECURED 
  
 Section 2.1 DEBT. This Security Instrument and the grants, assignments and transfers made in Article 1 are given for the purpose of securing the payment of the following, in such order of priority as Lender may
determine in its sole discretion (the “Debt”): 
  
 (a)
the indebtedness evidenced by the Note in lawful money of the United States of America; 

 (b) interest, default interest, late charges and other sums, as provided in the Note, the Credit
Agreement, this Security Instrument or the Other Security Documents (defined in Section 3.2); 
  
 (c) the Prepayment Fee (as defined in the Note), if any; 
  
 (d) all other monies agreed or provided to be paid by Borrower in the Note, the Credit Agreement, this Security Instrument or the Other Security Documents; 
  
 (e) all sums advanced pursuant to this Security Instrument to protect and preserve the Property and the lien and the
security interest created hereby; and 
  
 (f) all sums advanced
and costs and expenses incurred by Lender in connection with the Debt or any part thereof, any renewal, extension, or change of or substitution for the Debt or any part thereof, or the acquisition or perfection of the security therefor, whether made
or incurred at the request of Borrower or Lender. 
  
 Section 2.2
OTHER OBLIGATIONS. This Security Instrument and the grants, assignments and transfers made in Article I are also given for the purpose of securing the performance of the following (the “Other Obligations”): 
  
 (a) all other obligations of Borrower contained herein; 
  
 (b) each obligation of Borrower contained in the Note, the Credit Agreement
and in the Other Security Documents; and 
  
 (c) each obligation
of Borrower contained in any renewal, extension, amendment, modification, consolidation, change of, or substitution or replacement for, all or any part of the Note, the Credit Agreement, this Security Instrument or the Other Security Documents.

  
 Section 2.3 DEBT AND OTHER OBLIGATIONS. Borrower’s
obligations for the payment of the Debt and the performance of the Other Obligations shall be referred to collectively as the “Obligations.” 
  
 Section 2.4 PAYMENTS. Unless payments are made in the required amount in immediately available funds at the place where the Note is payable,
remittances in payment of all or any part of the Debt shall not, regardless of any receipt or credit issued therefor, constitute payment until the required amount is actually received by Lender in funds immediately available at the place where the
Note is payable (or any other place as Lender, in Lender’s sole discretion, may have established by delivery of written notice thereof to Borrower) and shall be made and accepted subject to the condition that any check or draft may be handled
for collection in 

 
accordance with the practice of the collecting bank or banks; provided, however, Lender shall not be required to accept payment for any Obligation in cash.
Acceptance by Lender of any payment in an amount less than the amount then due shall be deemed an acceptance on account only, and the failure to pay the entire amount then due shall be and continue to be an Event of Default. 
  
 Article 3 - BORROWER COVENANTS 
  
 Borrower covenants and agrees that: 
  
 Section 3.1 PAYMENT OF DEBT. Borrower will pay the Debt at the time
and in the manner provided in the Note and in this Security Instrument. 
  
 Section 3.2 INCORPORATION BY REFERENCE. All the covenants, conditions and agreements contained in (a) the Note and the Credit Agreement, and (b) all and any of the documents other than the Note, the Credit Agreement or this Security
Instrument now or hereafter executed and delivered by Borrower and/or others and by or in favor of Lender, which wholly or partially secure or guaranty payment of the Note or are otherwise executed and delivered in connection with the Loan
(hereinafter defined; such other documents, together with any and all extensions, renewals, substitutions, replacements, amendments, modifications and/or restatements thereof, the “Other Security Documents”) are hereby made a part of this
Security Instrument to the same extent and with the same force as if fully set forth herein. 
  
 Section 3.3 INSURANCE. 
  
 (a) Borrower shall obtain and maintain, or cause to be maintained, insurance for Borrower and the Property providing at least the following coverages: 
  

(i) insurance with respect to the Improvements and the Personal Property insuring against any peril now or hereafter included within
the classification “All Risk” or “Special Perils”, in each case (A) in an amount equal to 100% of the “Full Replacement Cost,” which for purposes of this Security Instrument shall mean actual replacement value
(exclusive of costs of excavations, foundations, underground utilities and footings) with a waiver of depreciation; (B) containing an agreed amount endorsement with respect to the Improvements and Personal Property waiving all coinsurance
provisions; (C) providing for no deductible in excess of $10,000.00; and (D) providing coverage for contingent liability from Operation of Building Laws, Demolition Costs and Increased Cost of Construction Endorsements together with an
“Ordinance or Law Coverage” or “Enforcement” endorsement. The Full Replacement Cost shall be redetermined from time to time (but not more frequently than once in any eighteen (18) calendar months) at the request of Lender by an
appraiser or contractor designated and paid by Borrower and approved by Lender, or by an engineer or appraiser in the regular employ of the insurer. After the first appraisal, additional appraisals may be based on construction cost indices
customarily employed in the trade. No omission on the part of Lender to request any such ascertainment shall relieve Borrower of any of its obligations under this Subsection; 

 (ii) commercial general liability insurance against all claims for personal injury,
bodily injury, death or property damage occurring upon, in or about the Property, such insurance (A) to be on the so-called “occurrence” form with a general aggregate limit of not less than $5,000,000 and a per occurrence limit of not less
than $2,000,000; (B) to continue at not less than the aforesaid limit until required to be changed by Lender in writing by reason of changed economic conditions making such protection inadequate; and (C) to cover at least the following hazards: (1)
premises and operations; (2) products and completed operations on an “if any” basis; (3) independent contractors; and (4) blanket contractual liability for all written and oral contracts; 
  
 (iii) Intentionally Omitted; 
  
 (iv) at all times during which structural construction,
repairs or alterations being made with respect to the Improvements (A) owner’s contingent or protective liability insurance covering claims not covered by or under the terms or provisions of the above mentioned commercial general liability
insurance policy; and (B) the insurance provided for in Section 3.3(a)(i) written in a so-called builder’s risk completed value form (1) on a non-reporting basis, (2) against all risks insured against pursuant to Section 3.3(a)(i), (3)
including permission to occupy the Property, and (4) with an agreed amount endorsement waiving co-insurance provisions; 
  
 (v) workers’ compensation, subject to the statutory limits of the state in which the Property is located, and employer’s
liability insurance with a limit of at least $1,000,000 per accident and per disease per employee, and $1,000,000 for disease aggregate in respect of any work or operations on or about the Property, or in connection with the Property or its
operation (if applicable); 
  
 (vi) comprehensive
boiler and machinery insurance, if applicable, in amounts as shall be reasonably required by Lender; 
  
 (vii) if any portion of the Improvements is at any time located in an area identified by the Secretary of Housing and Urban Development or
any successor thereto as an area having special flood hazards pursuant to the National Flood Insurance Act 1968, the Flood Disaster Protection Act of 1973 or the National Flood Insurance Reform Act of 1994, as each may be amended, or any successor
law (the “Flood Insurance Acts”), flood hazard insurance in an amount equal to the lesser of (A) the principal balance of the Note, and (B) the maximum limit of coverage available for the Property under the Flood Insurance Acts;

  
 (viii) intentionally deleted; and 

 
 (ix) such other insurance and in such amounts as Lender
from time to time may reasonably request against such other insurable hazards which at the time are commonly insured against for property similar to the Property located in or around the region in which the Property is located. 

 (b) All insurance provided for in Section 3.3(a) hereof shall be obtained under valid and enforceable
policies (the “Policies” or in the singular, the “Policy”), in such forms and, from time to time after the date hereof; in such amounts as may from time to time be satisfactory Lender, issued by financially sound and responsible
insurance companies authorized and admitted to do business in the state in which the Property is located and approved by Lender. The insurance companies must have a general policy rating of A or better and a financial class IX or better by A.M. Best
Company, Inc., and a claims paying ability/financial strength rating at least A- by Standard & Poor’s Corp. or such comparable rating by such other credit rating agency approved by Lender (a “Rating Agency”) or in the event such
insurance company is not so rated, said insurance company shall be acceptable to Lender in all respects (each such insurer shall be referred to below as a “Qualified Insurer”). Not less than thirty (30) days prior to the expiration dates
of the Policies theretofore furnished to Lender pursuant to Section 3.3(a), certified copies of the Policies marked “premium paid” or accompanied by evidence satisfactory to Lender of payment of the premiums due thereunder (the
“Insurance Premiums”), shall be delivered by Borrower to Lender; provided, however, that in the case of renewal Policies, Borrower may furnish Lender with binders therefor to be followed by the original Policies when issued. 
  
 (c) Borrower shall not obtain (1) any umbrella or blanket liability or
casualty Policy unless, in each case, such Policy is approved in advance in writing by Lender and Lender’s interest is included therein as provided in this Security Instrument and such Policy is issued by a Qualified Insurer, or (ii) separate
insurance concurrent in form or contributing in the event of loss with that required in Section 3.3(a) to be furnished by, or which may be reasonably required to be furnished by, Borrower. In the event Borrower obtains separate insurance or an
umbrella or a blanket Policy, Borrower shall notify Lender of the same and shall cause certified copies of each Policy to be delivered as required in Section 3.3(a) Any blanket insurance Policy shall specifically allocate to the Property the amount
of coverage from time to time required hereunder and shall otherwise provide the same protection as would a separate Policy insuring only the Property in compliance with the provisions of Section 3.3(a). 
  
 (d) All Policies of insurance provided for or contemplated by Section 3.3(a),
except for the Policy referenced in Section 3.3(a)(v), shall name Lender and Borrower as the insured or additional insured, as their respective interests may appear, and in the case of property damage, boiler and machinery, and flood insurance,
shall contain a so-called New York standard non-contributing mortgagee clause in favor of Lender providing that the loss thereunder shall be payable to Lender. 
  

(e) All Policies of insurance provided for in Section 3.3(a) shall contain clauses or endorsements to the effect that: 
  
 (i) no act or negligence of Borrower, or anyone acting for
Borrower, or of any tenant under any Lease or other occupant, or failure to comply with the provisions of any Policy which might otherwise result in a forfeiture of the insurance or any part thereof, shall in any way affect the validity or
enforceability of the insurance insofar as Lender is concerned; 

 (ii) the Policy shall not be materially changed (other than to increase the coverage
provided thereby) or cancelled without at least 30 days’ written notice to Lender and any other party named therein as an insured; and 
  
 (iii) each Policy shall provide that the issuers thereof shall give written notice to Lender if the Policy has not been renewed thirty
(30) days prior to its expiration; and 
  
 (iv)
Lender shall not be liable for any Insurance Premiums thereon or subject to any assessments thereunder. 
  
 (f) Borrower shall furnish to Lender, on or before thirty (30) days after the close of each of Borrower’s fiscal years, a statement certified by
Borrower or a duly authorized officer of Borrower of the amounts of insurance maintained in compliance herewith, of the risks covered by such insurance and of the insurance company or companies which carry such insurance and, if requested by Lender,
verification of the adequacy of such insurance by an independent insurance broker or appraiser acceptable to Lender. 
  
 (g) If at any time Lender is not in receipt of written evidence that all insurance required hereunder is in full force and effect, Lender shall have the
right, without notice to Borrower to take such action as Lender deems necessary to protect its interest in the Property, including, without limitation, the obtaining of such insurance coverage as Lender in its sole discretion deems appropriate, and
all expenses incurred by Lender in connection with such action or in obtaining such insurance and keeping it in effect shall be paid by Borrower to Lender upon demand and until paid shall be secured by this Security Instrument and shall bear
interest at the Default Rate (as defined in the Note). Lender shall endeavor to notify Borrower before obtaining any such coverage. 
  
 (h) If the Property shall be damaged or destroyed, in whole or in part, by fire or other casualty, Borrower shall give prompt notice of such damage to
Lender and shall promptly commence and diligently prosecute the completion of the repair and restoration of the Property as nearly as possible to the condition the Property was in immediately prior to such fire or other casualty, with such
alterations as may be approved by Lender (the “Casualty Restoration”) and otherwise in accordance with Section 3.7 of this Security Instrument. Borrower shall pay all costs of such Restoration whether or not such costs are covered by
insurance. 
  
 (i) In the event of a foreclosure of the Security
Instrument or other transfer of title to the Property in extinguishment in whole or in part of the Debt, all right, title and interest of Borrower in and to the Policies then in force concerning the Property and all proceeds payable thereunder shall
thereupon vest exclusively in Lender or the purchaser at such foreclosure or other transferee in the event of such other transfer of title. 
  
 Section 3.4 PAYMENT OF TAXES, ETC. 
  
 (a) Borrower shall promptly pay by their due date all taxes, assessments, water rates, sewer rents, and other governmental impositions, now or hereafter
levied or assessed or imposed against the Property or any part thereof (the “Taxes”), all ground rents, maintenance charges and 

 
similar charges, now or hereafter levied or assessed or imposed against the Property or any part thereof (the “Other Charges”), and all charges for
utility services provided to the Property as same become due and payable, unless contested in good faith as provided in subparagraph (b) below. Borrower will deliver to Lender, promptly upon Lender’s request, evidence satisfactory to Lender
that the Taxes, Other Charges and utility service charges have been so paid or are not then delinquent. Borrower shall not suffer and shall promptly cause to be paid and discharged any lien or charge whatsoever which may be or become a lien or
charge against the Property. Borrower shall furnish to Lender paid receipts for the payment of the Taxes and Other Charges prior to the date the same shall become delinquent. 
  
 (b) After prior written notice to Lender, Borrower, at its own expense, may contest by appropriate legal proceeding,
promptly initiated and conducted in good faith and with due diligence, the amount or validity or application in whole or in part of any of the Taxes, provided that (i) no Event of Default has occurred and is continuing under the Note, this Security
Instrument or any of the Other Security Documents, (ii) Borrower is permitted to do so under the provisions of any other mortgage, deed of trust or deed to secure debt affecting the Property, (iii) such proceeding shall suspend the collection of the
Taxes from Borrower and from the Property or Borrower shall have paid all of the Taxes under protest, (iv) such proceeding shall be permitted under and be conducted in accordance with the provisions of any other instrument to which Borrower is
subject and shall not constitute a default thereunder, (v) neither the Property nor any part thereof or interest therein will be in danger of being sold, forfeited, terminated, cancelled or lost, and (vi) Borrower shall have established appropriate
reserves in accordance with GAAP in respect to the Taxes, together with all interest and penalties thereon, unless Borrower has paid all of the Taxes under protest, or Borrower shall have furnished the security as may be required in the proceeding,
or as may be reasonably requested by Lender to insure the payment of any contested Taxes, together with all interest and penalties thereon. 
  
 Section 3.5 INTENTIONALLY OMITTED. 
  
 Section 3.6 CONDEMNATION. Borrower shall promptly give Lender notice of the actual or threatened commencement of any condemnation or eminent domain
proceeding and shall deliver to Lender copies of any and all papers served in connection with such proceedings. Notwithstanding any taking by any public or quasi-public authority through eminent domain or otherwise (including but not limited to any
transfer made in lieu of or in anticipation of the exercise of such taking), and whether or not any award or payment made in any condemnation or eminent domain proceeding (an “Award”) is made available to Borrower for Restoration in
accordance with Section 3.7, Borrower shall continue to pay the Debt at the time and in the manner provided for its payment in the Note and in this Security Instrument and the Debt shall not be reduced until any Award shall have been actually
received and applied by Lender, after the deduction of expenses of collection, to the reduction or discharge of the Debt. Lender shall not be limited to the interest paid on the Award by the condemning authority but shall be entitled to receive out
of the Award interest at the rate or rates provided herein or in the Note. Borrower shall cause the Award made in any condemnation or eminent domain proceeding, which is payable to Borrower, to be paid directly to Lender. Subject to Section 3.7,
Lender may apply any Award to the reduction or discharge of the Debt whether or not then due and payable. In the event that the Property or any portion thereof is taken by any condemning authority, Borrower 

 
shall promptly proceed to restore, repair, replace or rebuild the Property in a workmanlike manner to the extent practicable to be of at least equal value
and substantially the same character as prior to such condemnation or eminent domain proceeding (the “Condemnation Restoration”; the Condemnation Restoration and the Casualty Restoration are collectively hereinafter referred to as the
“Restoration”). If the Property is sold, through foreclosure or otherwise, prior to the receipt by Lender of the Award, Lender shall have the right, whether or not a deficiency judgment on the Note shall have been sought, recovered or
denied, to receive the Award, or a portion thereof sufficient to pay the Debt. 
  
 Section 3.7 RESTORATION. The following provisions shall apply in connection with the Restoration of the Property: 
  
 (a) If the Net Proceeds (defined below) shall be less than $100,000.00 and the costs of completing the Restoration shall be less than $100,000.00, the Net
Proceeds will be disbursed by Lender to Borrower upon receipt, provided that all of the conditions set forth in Section 3.7(b)(i) are met and Borrower delivers to Lender a written undertaking to expeditiously commence and to satisfactorily complete
with due diligence the Restoration in accordance with the terms of this Security Instrument. 
  
 (b) If the Net Proceeds are equal to or greater than $100,000.00 or the costs of completing the Restoration are equal to or greater than $100,000.00, Lender shall make the Net Proceeds available for the Restoration in
accordance with the provisions of this Section 3.7(b), The term “Net Proceeds” for the purposes of this Section shall mean: (1) the net amount of all insurance proceeds received by Lender pursuant to Section 3.3(a)(i), (iv), (vi), (vii),
and, as applicable, (ix) of this Security Instrument as a result of such damage or destruction, after deduction of its reasonable costs and expenses (including, but not limited to, reasonable legal fees), if any, in collecting same (“Insurance
Proceeds”) or (2) the net amount of the Award received by Lender, after deduction of its reasonable costs and expenses (including, but not limited to, reasonable legal fees), if any, in collecting same (“Condemnation Proceeds”),
whichever the case may be. 
  
 (i) The Net
Proceeds shall be made available to Borrower for the Restoration provided that each of the following conditions is met: 
  
 (A) no Event of Default shall have occurred and be continuing under the Note, the Credit Agreement, this Security Instrument or any of the
Other Security Documents; 
  
 (B) (1) in the
event the Net Proceeds are Insurance Proceeds, less than twenty percent (20%) of the total floor area of the Improvements has been damaged, destroyed or rendered unusable as a result of such fire or other casualty or (2) in the event the Net
Proceeds are Condemnation Proceeds, less than twenty -percent (20%) of the land constituting the Property has been taken, such land is located along the perimeter or periphery of the Property, no portion of the Improvements is located on such land
and such taking does not materially impair the existing access to the Property; 

 (C) Intentionally Deleted; 
  
 (D) Borrower shall commence the Restoration as soon as reasonably practicable (but in no event later than
thirty (30) days after such damage, destruction or taking occurs) and shall diligently pursue the same to satisfactory completion; 
  
 (E) Lender shall be satisfied that any operating deficits which will be incurred with respect to the Property as a result of the
occurrence of any such fire or other casualty or taking will be covered out of (1) the Net Proceeds, or (2) other funds of Borrower; 
  
 (F) Intentionally Omitted; 
  
 (G) Lender shall be satisfied that the Restoration will be completed on or before the earliest to occur of (1) twelve (12) months prior to
the Loan Maturity Date (as defined in the Note), (2) twelve (12) months after the occurrence of such fire or other casualty or taking, or (3) such time as may be required under applicable zoning law, ordinance, rule or regulation in order to repair
and restore the Property to the condition it was in immediately prior to such fire or other casualty or taking; 
  
 (H) Borrower shall execute and deliver to Lender a completion guaranty in form and substance satisfactory to Lender and its counsel
pursuant to the provisions of which Borrower shall guaranty to Lender the lien-free completion by Borrower of the Restoration in accordance with the provisions of this Section 3.7(b); 
  
 (I) the Property and the use thereof after the Restoration will be in compliance with and permitted under
all applicable zoning laws, ordinances, rules and regulations; and 
  
 (J) the Restoration shall be done and completed by Borrower in an expeditious and diligent fashion and in compliance with all applicable governmental laws, rules and regulations (including, without limitation, all
applicable Environmental Laws (defined below). 
  
 (ii) The Net Proceeds shall be held by Lender in an interest bearing trust account and, until disbursed in accordance with the provisions of this Section 3.7(b), shall constitute additional security for the Obligations. The Net Proceeds
shall be disbursed by Lender to, or as directed by, Borrower from time to time during the course of the Restoration, upon receipt of evidence satisfactory to Lender that (A) all materials installed and work and labor performed (except to the extent
that they are to be paid for out of the requested disbursement) in connection with the Restoration have been paid for in full, and (B) there exist no notices of pendency, stop orders, mechanic’s or 

 
materialman’s liens or notices of intention to file same, or any other liens or encumbrances of any nature whatsoever on the Property arising out of the
Restoration which have not either been fully bonded to the satisfaction of Lender and discharged of record or in the alternative fully insured to the satisfaction of Lender by the title company insuring the lien of this Security Instrument.

  
 (iii) All plans and specifications required
in connection with the Restoration shall be subject to prior review and acceptance in all respects by Lender and by an independent consulting engineer selected by Lender (the “Restoration Consultant”). Lender shall have the use of the
plans and specifications and all permits, licenses and approvals required or obtained in connection with the Restoration, The identity of the contractors, subcontractors and materialmen engaged in the Restoration, as well as the contracts under
which they have been engaged, shall be subject to prior review and acceptance by Lender and the Restoration Consultant. All costs and expenses incurred by Lender in connection with making the Net Proceeds available for the Restoration including,
without limitation, reasonable legal fees and disbursements and the Restoration Consultant’s fees, shall be paid by Borrower. 
  
 (iv) In no event shall Lender be obligated to make disbursements of the Net Proceeds in excess of an amount equal to the costs actually
incurred from time to time for work in place as part of the Restoration, as certified by the Restoration Consultant, minus the Restoration Retainage. The term “Restoration Retainage” as used in this Section 3.7(b) shall mean an amount
equal to 10% of the costs actually incurred for work in place as part of the Restoration, as certified by the Restoration Consultant. The Restoration Retainage shall in no event be less than the amount actually held back by Borrower from
contractors, subcontractors and materialmen engaged in the Restoration. The Restoration Retainage shall not be released until the Restoration Consultant certifies to Lender that the Restoration has been completed in accordance with the provisions of
this Section 3.7(b) and that all approvals necessary for the re-occupancy and use of the Property have been obtained from all appropriate governmental and quasi-governmental authorities, and Lender receives evidence satisfactory to Lender that the
costs of the Restoration have been paid in full or will be paid in full out of the Restoration Retainage, provided, however, that Lender will release the portion of the Restoration Retainage being held with respect to any contractor, subcontractor
or materialman engaged in the Restoration as of the date upon which the Restoration Consultant certifies to Lender that the contractor, subcontractor or materialman has satisfactorily completed all work and has supplied all materials in accordance
with the provisions of the contractor’s, subcontractor’s or inaterialman’s contract, and the contractor, subcontractor or materialman delivers the lien waivers and evidence of payment in full of all sums due to the contractor,
subcontractor or materialman as may be reasonably requested by Lender or by the title company insuring the lien of this Security Instrument. If required by Lender, the release of any such portion of the Restoration Retainage shall be approved by the
surety company, if any, which has issued a payment or performance bond with respect to the contractor, subcontractor or materialman. 
  
 (v) Lender shall not be obligated to make disbursements of the Net Proceeds more frequently than once every calendar month. 

 (vi) If at any time the Net Proceeds or the undisbursed balance thereof shall not, in the
reasonable opinion of Lender, be sufficient to pay in full the balance of the costs which are estimated by the Restoration Consultant to be incurred in connection with the completion of the Restoration, Borrower shall not be entitled to any further
disbursements of the Net Proceeds hereunder until Borrower shall deposit the deficiency (the “Net Proceeds Deficiency”) in immediately available funds with Lender. The Net Proceeds Deficiency deposited with Lender shall be held by Lender
and shall be disbursed for costs actually incurred in connection with the Restoration on the same conditions applicable to the disbursement of the Net Proceeds, and until so disbursed pursuant to this Section 3.7(b) shall constitute additional
security for the Obligations. 
  
 (vii) The
excess, if any, of the Net Proceeds and the remaining balance, if any, of the Net Proceeds Deficiency deposited with Lender after the Restoration Consultant certifies to Lender that the Restoration has been completed in accordance with the
provisions of this Section 3.7(b), and the receipt by Lender of evidence satisfactory to Lender that all costs incurred in connection with the Restoration have been paid in full, shall be remitted by Lender to Borrower, with any interest earned
thereon, provided no Event of Default shall have occurred and shall be continuing under the Note, the Credit Agreement, this Security Instrument or any of the Other Security Documents. 
  
 (c) All Net Proceeds not required (i) to be made available for the Restoration or (ii) to be returned to Borrower as excess
Net Proceeds pursuant to Section 3.7(b)(vii) may be retained and applied by Lender toward the payment of the Debt whether or not then due and payable in such order, priority and proportions as Lender in its discretion shall deem proper or, at the
discretion of Lender, the same may be paid, either in whole or in part, to Borrower for such purposes as Lender shall designate, in its discretion. If Lender shall receive and retain Net Proceeds, the lien of this Security Instrument shall be
reduced only by the amount thereof received and retained by Lender and actually applied by Lender in reduction of the Debt. 
  
 Section 3.8 LEASES AND RENTS. 
  
 (a) Borrower may enter into a proposed Lease (including the renewal or extension of an existing Lease (a “Renewal Lease”)) without the prior
written consent of Lender, provided such proposed Lease or Renewal Lease (i) provides for rental rates and terms comparable to existing local market rates and terms (taking into account the type and quality of the tenant) as of the date such Lease
is executed by Borrower (unless, in the case of a Renewal Lease, the rent payable during such renewal, or a formula or other method to compute such rent, is provided for in the original Lease), (ii) is an arms-length transaction with a bona fide,
independent third party tenant, (iii) does not have a materially adverse effect on the value of the Property taken as a whole, (iv) is subject and subordinate to the Security Instrument and the lessee thereunder agrees to attorn to Lender, and (v)
is written on a form of lease approved by Lender. All proposed Leases which do not satisfy the requirements set forth in this Section 3.8(a) shall be subject to the prior approval of Lender and its counsel, at Borrower’s expense. Borrower shall
promptly deliver to Lender copies of all Leases which are entered into pursuant to this Subsection together with Borrower’s certification that it has satisfied all of the conditions of this Subsection. 

 (b) Borrower (i) shall observe and perform all the obligations imposed upon the lessor under the Leases
and shall not do or permit to be done anything to impair the value of any of the Leases as security for the Debt; (ii) shall promptly send copies to Lender of all notices of default which Borrower shall send or receive thereunder; (iii) shall
enforce all of the material terms, covenants and conditions contained in the Leases upon the part of the tenant thereunder to be observed or performed; (iv) shall not collect any of the Rents more than one (1) month in advance (except security
deposits shall not be deemed Rents collected in advance); (v) shall not execute any other assignment of the lessor’s interest in any of the Leases or the Rents; and (vi) shall not consent to any assignment of or subletting under any Leases not
in accordance with their terms, without the prior written consent of Lender. 
  
 (c) Except with respect to any Major Lease (defined below), Borrower may, without the consent of Lender, amend, modify or waive the provisions of any Lease or terminate, reduce rents under, accept a surrender of space
under, or shorten the term of, any Lease (including any guaranty, letter of credit or other credit support with respect thereto) provided that such action (taking into account, in the case of a termination, reduction in rent, surrender of space or
shortening of term, the planned alternative use of the affected space) does not have a materially adverse effect on the value of the Property taken as a whole, and provided that such Lease, as amended, modified or waived, is otherwise in compliance
with the requirements of this Security Instrument and any subordination agreement binding upon Lender with respect to such Lease. A termination of a Lease with a tenant who is in default beyond applicable notice and grace periods shall not be
considered an action which has a materially adverse effect on the value of the Property taken as a whole. Any amendment, modification, waiver, termination, rent reduction, space surrender or term shortening which does not satisfy the requirements
set forth in this Subsection shall be subject to the prior approval of Lender and its counsel, at Borrower’s expense. Borrower shall promptly deliver to Lender copies of amendments, modifications and waivers which are entered into pursuant to
this Subsection together with Borrower’s certification that it has satisfied all of the conditions of this Subsection. 
  
 (d) Notwithstanding anything contained herein to the contrary, Borrower shall not, without the prior written consent of Lender, enter into, renew, extend,
amend, modify, waive any provisions of, terminate, reduce rents under, accept a surrender of space under, or shorten the term of any Major Lease. The term “Major Lease” shall mean (i) any Lease which (A) covers twenty percent (20%) or more
of the total space at the Property, in the aggregate, or (B) provides for a lease term of more than ten (10) years including options to renew and (ii) any instrument guaranteeing or providing credit support for any Major Lease. 
  
 Section 3.9 MAINTENANCE AND USE OF PROPERTY. Borrower shall cause the
Property to be maintained in a good and safe condition and repair. Borrower shall not (and shall not permit any tenant or other person to) remove, demolish or materially alter the Property or any part thereof (except for normal replacement of the
Personal Property) without the consent of Lender. Borrower shall promptly repair, replace or rebuild any part of the Property which may be destroyed by any casualty, or become damaged, worn or dilapidated or which may be affected by any proceeding
of the character referred to in Section 3.6 hereof and shall complete and pay for any structure at any time in the process of construction or repair on the Land. Borrower shall 

 
not initiate, join in, acquiesce in, or consent to any material change in any private restrictive covenant, zoning law or other public or private
restriction, limiting or defining the uses which may be made of the Property or any part thereof without the prior written consent of Lender, which consent shall not be unreasonably withheld or delayed. If under applicable zoning provisions the use
of all or any portion of the Property is or shall become a nonconforming use, Borrower will not cause or permit the nonconforming use to be discontinued or the nonconforming Improvement to be abandoned without the express written consent of Lender.

  
 Section 3.10 WASTE. Borrower shall not commit or suffer
any waste of the Property or make any change in the use of the Property which will in any way materially increase the risk of fire or other hazard arising out of the operation of the Property, or take any action that might invalidate or give cause
for cancellation of any Policy, or do or permit to be done thereon anything that may materially impair the value of the Property or the security of this Security Instrument. Borrower will not, without the prior written consent of Lender, permit any
drilling or exploration for or extraction, removal, or production of any minerals from the surface or the subsurface of the Land, regardless of the depth thereof or the method of mining or extraction thereof. 
  
 Section 3.11 COMPLIANCE WITH LAWS. 
  
 (a) Borrower shall promptly comply in all material respects with all
Applicable Laws (defined in Section 20.1) affecting the Property, or the use thereof, including all Environmental Laws. 
  
 (b) Borrower shall from time to time, upon Lender’s request, provide Lender with evidence reasonably satisfactory to Lender that the Property
complies with all Applicable Laws or is exempt from compliance with Applicable Laws. 
  
 (c) Notwithstanding any provisions set forth herein or in any document regarding Lender’s approval of alterations of the Property, Borrower shall not alter the Property in any manner which would materially
increase Borrower’s responsibilities for compliance with Applicable Laws without the prior written approval of Lender. Lender’s approval of the plans, specifications, or working drawings for alterations of the Property shall create no
responsibility or liability on behalf of Lender for their completeness, design, sufficiency or their compliance with Applicable Laws. The foregoing shall apply to tenant improvements constructed by Borrower or by any of its tenants. Lender may
condition any such approval upon receipt of a certificate of compliance with Applicable Laws from an independent architect, engineer, or other person acceptable to Lender. 
  
 (d) Borrower shall give prompt notice to Lender of the receipt by Borrower of any notice related to a violation of any
Applicable Laws and of the commencement of any proceedings or investigations which relate to compliance with Applicable Laws. 
  
 (e) After prior written notice to Lender, Borrower, at its own expense, may contest by appropriate legal proceeding, promptly initiated and conducted in
good faith and with due diligence, the Applicable Laws affecting the Property, provided that (i) no Event of Default has occurred and is continuing under the Note, the Credit Agreement, this Security Instrument or any 

 
of the Other Security Documents; (ii) Borrower is permitted to do so under the provisions of any other mortgage, deed of trust or deed to secure debt
affecting the Property; (iii) such proceeding shall be permitted under and be conducted in accordance with the provisions of any other instrument to which Borrower or the Property is subject and shall not constitute a default thereunder; (iv)
neither the Property, any part thereof or interest therein, any of the tenants or occupants thereof, nor Borrower shall be affected in any material adverse way as a result of such proceeding; (v) non-compliance with the Applicable Laws shall not
impose criminal or material civil liability on Borrower or Lender; (vi) Borrower shall have furnished the security as may be required in the proceeding or by Lender to ensure compliance by Borrower with the Applicable Laws and (vii) Borrower shall
have furnished to Lender all other items reasonably requested by Lender. 
  
 Section 3.12 PAYMENT FOR LABOR AND MATERIALS. Borrower will promptly pay when due all applicable bills and costs for labor, materials, and specifically fabricated materials incurred in connection with the
Property and never permit to exist in respect of the Property or any part thereof any lien or security interest, even though inferior to the liens and the security interests hereof, and in any event never permit to be created or exist in respect of
the Property or any part thereof any other or additional lien or security interest other than the liens or security interests hereof, except for the Permitted Exceptions (defined below). 
  
 Section 3.13 PERFORMANCE OF OTHER AGREEMENTS. Borrower shall observe and perform each and every term to be observed
or performed by Borrower pursuant to the terms of any agreement or recorded instrument affecting or pertaining to the Property, or given by Borrower to Lender for the purpose of further securing an Obligation and any amendments, modifications or
changes thereto. 
  
 Section 3.14 MANAGEMENT. The Property
shall be managed by Borrower. All Rents, if any, generated by or derived from the Property shall first be utilized solely for current expenses directly attributable to the ownership and operation of the Property, including, without limitation,
current expenses relating to Borrower’s liabilities and obligations with respect to the Note, this Security Instrument and the Other Security Documents, and none of the Rents generated by or derived from the Property shall be diverted by
Borrower and utilized for any other purpose unless all such current expenses attributable to the ownership and operation of the Property have been fully paid and satisfied. 
  
 Article 4 - SPECIAL COVENANTS 
  

Borrower covenants and agrees that: 
  
 Section 4.1 PROPERTY USE. The Property shall be used only for manufacturing, warehouse, research and development, showroom and office purposes, and
for no other use without the prior written consent of Lender. 

 Article 5 - REPRESENTATIONS AND WARRANTIES 
  
 Borrower represents and warrants to Lender that: 
  
 Section 5.1 WARRANTY OF TITLE. Borrower has good title to the Property
and has the right to mortgage, grant, bargain, sell, pledge, assign, warrant, transfer and convey the same and that Borrower possesses an unencumbered fee simple absolute estate in the Land and the Improvements and that it owns the Property free and
clear of all liens, encumbrances and charges whatsoever except for those exceptions shown in the title insurance policy insuring the lien of this Security Instrument (the “Permitted Exceptions”). Borrower shall forever warrant, defend and
preserve the title and the validity and priority of the lien of this Security Instrument and shall forever warrant and defend the same to Lender against the claims of all persons whomsoever, other than with respect to Permitted Exceptions (as such
term is defined in the Credit Agreement). 
  
 Section 5.2
STATUS OF PROPERTY. 
  
 (a) Borrower has obtained all
material certificates, licenses and other approvals, governmental and otherwise, necessary for the operation of the Property and the conduct of its business and all required zoning, building code, land use, environmental and other similar permits or
approvals, all of which are in full force and effect as of the date hereof and not subject to revocation, suspension, forfeiture or modification. 
  
 (b) The Property and the present and contemplated use and occupancy thereof are in compliance, in all material respects, with all applicable zoning
ordinances, building codes, land use laws, Environmental Laws and other similar laws. 
  
 (c) The Property is served by all utilities required for the current or currently contemplated use thereof. All utility service is provided by public utilities and the Property has accepted or is equipped to accept
such utility service. 
  
 (d) All public roads and streets
necessary for service of and access to the Property for the current or contemplated use thereof have been completed, are serviceable and are physically and legally open for use by the public. 
  
 (e) The Property is served by public water and sewer systems. 
  
 (f) The Property is free from damage caused by fire or other casualty.

  
 (g) All costs and expenses of any and all labor, materials,
supplies and equipment used in the construction of the Improvements that are due and payable have been paid in full. 
  
 (h) Borrower has paid in full for, and is the owner of, all furnishings, fixtures and equipment used in connection with the operation of the Property,
free and clear of any and all security interests, liens or encumbrances, except the lien and security interest created hereby, except for Permitted Exceptions. 
  

(i) All liquid and solid waste disposal, septic and sewer systems located on the Property are in a good and safe condition and repair and in compliance
(in all material respects) with all Applicable Laws. 

 (j) No portion of the Improvements is located in an area identified by the Federal Emergency Management
Agency or any successor thereto as an area having special flood hazards pursuant to the Flood Insurance Acts or, if any portion of the Improvements is located within such area, Borrower has obtained and will maintain the insurance prescribed in
Section 3.3(a) (vii) hereof. 
  
 (k) All the Improvements lie
within the boundaries of the Land. 
  
 (l) The Property is
presently not subject to any Leases. 
  
 Section 5.3 SEPARATE
TAX LOT. The Property is assessed for real estate tax purposes as one or more wholly independent tax lot or lots, separate from any adjoining land or improvements not constituting a part of such lot or lots, and no other land or improvements is
assessed and taxed together with the Property or any portion thereof. 
  
 Section 5.4 PERMITTED EXCEPTIONS. None of the Permitted Exceptions, individually or in the aggregate, materially interferes with the benefits of the security intended to be provided by the Security Instrument, the Note, and the Other
Security Documents, materially and adversely affects the value of the Property, impairs the use or the operation of the Property or impairs Borrower’s ability to pay its obligations in a timely manner. 
  
 Article 6 - OBLIGATIONS AND RELIANCE’S 
  
 Section 6.1 RELATIONSHIP OF BORROWER AND LENDER. The relationship
between Borrower and Lender is solely that of debtor and creditor, and Lender has no fiduciary or other special relationship with Borrower, and no term or condition of any of the Note, the Credit Agreement, this Security Instrument and the Other
Security Documents shall be construed so as to deem the relationship between Borrower and Lender to be other than that of debtor and creditor. 
  
 Section 6.2 NO RELIANCE ON LENDER. The members, general partners, principals and (if Borrower is a trust) beneficial owners of Borrower are
experienced in the ownership and operation of properties similar to the Property, and Borrower and Lender are relying solely upon such expertise in connection with the ownership and operation of the Property. Borrower is not relying on Lender’s
expertise, business acumen or advice in connection with the Property. 
  
 Section 6.3 NO LENDER OBLIGATIONS. (a) Notwithstanding anything herein to the contrary, Lender is not undertaking the performance of (i) any obligations under the Leases; or (ii) any obligations with respect to such agreements,
contracts, certificates, instruments, franchises, permits, trademarks, licenses and other documents. 
  
 (b) By accepting or approving anything required to be observed, performed or fulfilled or to be given to Lender pursuant to this Security Instrument, the
Note or the Other Security Documents, including without limitation, any officer’s certificate, balance sheet, statement of profit and loss or other financial statement, survey, appraisal, or insurance policy, Lender shall 

 
not be deemed to have warranted, consented to, or affirmed the sufficiency, the legality or effectiveness of same, and such acceptance or approval thereof
shall not constitute any warranty or affirmation with respect thereto by Lender. 
  
 Section 6.4 RELIANCE. Borrower recognizes and acknowledges that in accepting the Note, the Credit Agreement, this Security Instrument and the Other Security Documents, Lender is expressly and primarily relying
on the truth and accuracy of the warranties and representations set forth in Article 5 and Article 12 without any obligation to investigate the Property and notwithstanding any investigation of the Property by Lender; that such reliance existed on
the part of Lender prior to the date hereof that the warranties and representations are a material inducement to Lender in accepting the Note, this Security Instrument and the Other Security Documents; and that Lender would not be willing to make
the Loan and accept this Security Instrument in the absence of the warranties and representations as set forth in Article 5 and Article 12. 
  
 Article 7 - FURTHER ASSURANCES 
  
 Section 7.1 RECORDING OF SECURITY INSTRUMENT, ETC. 
  
 (a) Borrower forthwith upon the execution and delivery of this Security Instrument and thereafter, from time to time, will cause this Security Instrument
and any of the Other Security Documents creating a lien or security interest or evidencing the lien hereof upon the Property and each instrument of further assurance to be filed, registered or recorded in such manner and in such places as may be
required by any present or future law in order to publish notice of and fully to protect and perfect the lien or security interest hereof upon, and the interest of Lender in, the Property. Borrower will pay all taxes, filing, registration or
recording fees, and all expenses incident to the preparation, execution, acknowledgment and/or recording of the Note, the Credit Agreement, this Security Instrument, the Other Security Documents, any note or deed of trust or mortgage supplemental
hereto, any security instrument with respect to the Property and any instrument of further assurance, and any modification or amendment of the foregoing documents, and all federal, state, county and municipal taxes, duties, imposts, assessments and
charges arising out of or in connection with the execution and delivery of this Security Instrument, any deed of trust or mortgage supplemental hereto, any security instrument with respect to the Property or any instrument of further assurance, and
any modification or amendment of the foregoing documents, except where prohibited by law so to do. 
  
 (b) The Borrower hereby irrevocably authorizes the Lender at any time and from time to time to file in any filing office in any Uniform Commercial Code
jurisdiction any initial financing statements and amendments thereto that provide any information required by part 5 of Article 9 of the Uniform Commercial Code of the state(s) where any of the Property is located or such other jurisdiction for the
sufficiency or filing office acceptance of any financing statement or amendment, including (i) whether the Borrower is an organization, the type of organization and any organization identification number issued to the Borrower and, (ii) in the case
of a financing statement filed as a fixture filing a sufficient description of real property to which the Property relates. The Borrower agrees to furnish any such information to the Lender promptly upon the Lender’s request. The Borrower also
ratifies its authorization for the Lender to have 

 
filed in any Uniform Commercial Code jurisdiction any like initial financing statements or amendments thereto if filed prior to the date hereof. 

 
 Section 7.2 FURTHER ACTS, ETC. Borrower will, at the cost of
Borrower, and without expense to Lender, do, execute, acknowledge and deliver all and every such further acts, deeds, conveyances, mortgages, deeds of trusts, assignments, notices of assignments, transfers and assurances as Lender shall, from time
to time, reasonably require, for the better assuring, conveying, assigning, transferring, and confirming unto Lender the Property and rights hereby mortgaged, granted, bargained, sold, conveyed, confirmed, pledged, assigned, warranted and
transferred or intended now or hereafter so to be, or which Borrower may be or may hereafter become bound to convey or assign to Lender, or for carrying out the intention or facilitating the performance of the terms of this Security Instrument or
for filing, registering or recording this Security Instrument, or for complying with all Applicable Laws. Borrower, on demand, will execute and deliver and hereby authorizes Lender to execute in the name of Borrower or without the signature of
Borrower to the extent Lender may lawfully do so, one or more instruments, to evidence or perfect more effectively the security interest of Lender in the Property. Borrower grants to Lender an irrevocable power of attorney coupled with an interest
for the purpose of exercising and perfecting any and all rights and remedies available to Lender pursuant to this Section 7.2. 
  
 Section 7.3 CHANGES IN TAX, DEBT CREDIT AND DOCUMENTARY STAMP LAWS. 
  
 (a) If any law is enacted or adopted or amended after the date of this Security Instrument which deducts the Debt from the
value of the Property for the purpose of taxation or which imposes a tax, either directly or indirectly, on the Debt or Lender’s interest in the Property, Borrower will pay the tax, with interest and penalties thereon, if any. If Lender is
advised by counsel chosen by it that the payment of tax by Borrower would be unlawful or taxable to Lender or unenforceable or provide the basis for a defense of usury, then Lender shall have the option, exercisable by written notice of not less
than ninety (90) days, to declare the Debt immediately due and payable. 
  
 (b) Borrower will not claim or demand or be entitled to any credit or credits on account of the Debt for any part of the Taxes or Other Charges assessed against the Property, or any part thereof, and no deduction shall otherwise be made or
claimed from the assessed value of the Property, or any part thereof, for real estate tax purposes by reason of this Security Instrument or the Debt. If such claim, credit or deduction shall be required by law, Lender shall have the option,
exercisable by written notice of not less than ninety (90) days, to declare the Debt immediately due and payable. 
  
 (c) If at any time the United States of America, any State thereof or any subdivision of any such State shall require revenue or other stamps to be
affixed to the Note, this Security Instrument, or any of the Other Security Documents or impose any other tax or charge on the same, Borrower will pay for the same, with interest and penalties thereon, if any. 

 Section 7.4 ESTOPPEL CERTIFICATES. 
  
 (a) After request by Lender, Borrower, within ten (10) days, shall furnish Lender or any proposed assignee with a statement,
duly acknowledged and certified, setting forth (1) the original principal amount of the Note, (ii) the unpaid principal amount of the Note, (iii) the rate of interest of the Note, (iv) the terms of payment and Loan Maturity Date of the Note, (v) the
date installments of interest and/or principal Were last paid, (vi) that, except as provided in such statement, there are no defaults or events which with the passage of time or the giving of notice or both, would constitute an event of default
under the Note or the Security Instrument, (vii) that the Note and this Security Instrument are valid, legal and binding obligations and have not been modified or if modified, giving particulars of such modification, (viii) whether any offsets or
defenses exist against the obligations secured hereby and, if any are alleged to exist, a detailed description thereof, (ix) that all Leases, if any, are in full force and effect and have not been modified (or if modified, setting forth all
modifications), (x) the date to which the Rents thereunder have been paid pursuant to the Leases, if any, (xi) whether or not, to the best knowledge of Borrower, any of the lessees under the Leases, if any, are in default under the Leases, if any,
and, if any of the lessees are in default, setting forth the specific nature of all such defaults, (xii) the amount of security deposits held by Borrower under each Lease, if any, and that such amounts are consistent with the amounts required under
such Lease, and (xiii) as to any other matters reasonably requested by Lender and reasonably related to the Leases, if any, the obligations secured hereby, the Property or this Security Instrument. 
  
 (b) If there are Leases in effect, Borrower shall use its best efforts to
deliver to Lender, promptly upon request, duly executed estoppel certificates from any one or more lessees as required by Lender attesting to such facts regarding the Lease as Lender may require, including, but not limited to, attestations that each
Lease covered thereby is in full force and effect with no defaults thereunder on the part of any party, that none of the Rents have been paid more than one month in advance, except as security, and that the lessee claims no defense or offset against
the full and timely performance of its obligations under the Lease. 
  
 (c) Upon any transfer or proposed transfer contemplated by Section 18.1 hereof, at Lender’s request, Borrower shall provide an estoppel certificate to the Investor (defined in Section 18.1) or any prospective Investor in such form,
substance and detail as Lender, such Investor or prospective Investor may require. 
  
 Section 7.5 FLOOD INSURANCE. After Lender’s request, Borrower shall deliver evidence satisfactory to Lender that no portion of the Improvements is situated in a federally designated “special flood
hazard area” or, if it is, that Borrower has obtained insurance meeting the requirements of Section 3.3(a)(vii). 
  
 Section 7.6 REPLACEMENT DOCUMENTS. Upon receipt of an affidavit of an officer of Lender as to the loss, theft, destruction or mutilation of the
Note or any Other Security Document which is not of public record, and, in the case of any such mutilation, upon surrender and cancellation of such Note or Other Security Document, Borrower will issue, in lieu thereof, a replacement Note or
Other Security Document, dated the date of such lost, stolen, destroyed or mutilated Note or Other Security Document in the same principal amount thereof and otherwise of like tenor. 

 Article 8 - DUE ON SALE/ENCUMBRANCE 
  
 Section 8.1 TRANSFER DEFINITIONS. For purposes of this Article S, a “Sale or Pledge” shall mean a voluntary
or involuntary sale, conveyance, transfer or pledge of a legal or beneficial interest. 
  
 Section 8.2 NO SALE/ENCUMBRANCE. (a) Borrower shall not sell, convey, mortgage, grant, bargain, encumber, pledge, assign, grant options with respect to, or otherwise transfer or dispose of (directly or
indirectly, voluntarily or involuntarily, by operation of law or otherwise, and whether or not for consideration or of record) the Property or any part thereof or any legal or beneficial interest therein (collectively a “Transfer”), other
than pursuant to Leases of space in the Improvements to tenants in accordance with the provisions of Section 3.8, without the prior written consent of Lender. 
  

(b) A Transfer shall include, but not be limited to, (i) an installment sales agreement wherein Borrower agrees to sell the Property or any part
thereof for a price to be paid in installments; (ii) an agreement by Borrower leasing all or a substantial part of the Property for other than actual occupancy by a space tenant thereunder or a sale, assignment or other transfer of, or the grant of
a security interest in, Borrower’s right, title and interest in and to any Leases or any Rents; (iii) a Change in Control (as such term is defined in the Credit Agreement). 
  
 Section 8.3 PERMITTED TRANSFERS. (a) Notwithstanding the provisions of Section 8.1 and 8.2, but subject to Section
7.1(r) of the Credit Agreement, the following shall not constitute a Transfer: (i) the sale, transfer or issuance of stock in Borrower or any beneficial ownership interest therein, provided same does not constitute a Change in Control (as such term
is defined in the Credit Agreement); and (ii) the disposition of any part of the Property, other than real property, consisting of obsolete or unused assets, provided that such obsolete or unused assets shall be replaced with assets of equal or
greater value, and such replacement assets shall constitute a part of the Property. 
  
 Article 9 - PREPAYMENT 
  
 Section 9.1 PREPAYMENT. The Debt may not be prepaid in whole or in part except in strict accordance with the express terms and conditions of the Note. 
  
 Article 10 - DEFAULT 
  
 Section 10.1 EVENTS OF DEFAULT. The occurrence of any one or more of the following events shall constitute an “Event of Default”:

  
 (a) the occurrence of any “Event of Default” as such
term is defined in the Credit Agreement; 
  
 (b) if any of the
Taxes or Other Charges is not paid when the same is due and payable except in accordance with the terms of Section 3.4 of this Security Instrument; 

 (c) if the Policies are not kept in full force and effect, or if the Policies are not delivered to Lender
as provided in Section 3.3(b); 
  
 (d) if the Property becomes
subject to any mechanic’s, materialman’s or other lien other than a lien not then due and payable and the lien shall remain undischarged of record (by payment, bonding or otherwise) for a period of thirty (30) days; 
  
 (e) if any federal tax lien is filed against Borrower or the Property and
same is not discharged of record within thirty (30) days after same is filed; 
  
 (f) if Borrower shall fail to deliver to Lender, within ten (10) days after request by Lender, the estoppel certificates required by Section 7.4(a) and (c); 
  
 (g) if any default occurs under any guaranty or indemnity executed in
connection herewith (including the Environmental Indemnity, defined in Section 13.4) and such default continues after the expiration of applicable grace periods, if any; or 
  
 (h) if for more than ten (10) days after notice from Lender, Borrower shall continue to be in default under any term,
covenant or condition of this Security Instrument not set forth in Section 10.1(a) through (g) above, then, in the case of any default which can be cured by the payment of a sum of money, or for thirty (30) days after notice from Lender in the case
of any other default, provided that if such default cannot reasonably be cured within such thirty (30) day period and Borrower shall have commenced to cure such default within such thirty (30) day period and thereafter diligently and expeditiously
proceeds to cure the same, such thirty (30) day period shall be extended for so long as it shall require Borrower in the exercise of due diligence to cure such default, it being agreed that no such extension shall be for a period in excess of ninety
(90) days. 
  
 Article 11 - RIGHTS AND REMEDIES 

 
 Section 11.1 REMEDIES. Upon the occurrence of any Event of Default,
Borrower agrees that Lender may take such action, without notice or demand, as it deems advisable to protect and enforce its rights against Borrower in and to the Property, including, but not limited to the following actions, each of which may be
pursued concurrently or otherwise, at such time and in such order as Lender may determine, in its sole discretion, without impairing or otherwise affecting the other rights and remedies of Lender: 
  
 (a) declare the entire unpaid Debt to be immediately due and payable;

  
 (b) institute proceedings, judicial or otherwise, for the
complete foreclosure of this Security Instrument under any applicable state or federal law in which case the Property or any interest therein may be sold for cash or upon credit in one or more parcels or in several interests or portions and in any
order or manner; 

 (c) with or without entry, to the extent permitted and pursuant to the procedures provided by applicable
state or federal law, institute proceedings for the partial foreclosure of this Security Instrument for the portion of the Debt then due and payable, subject to the continuing lien and security interest of this Security Instrument for the balance of
the Debt not then due, unimpaired and without loss of priority; 
  
 (d) sell for cash or upon credit the Property or any part thereof and all estate, claim, demand, right, title and interest of Borrower therein and rights of redemption thereof, pursuant to power of sale or otherwise, at one or more sales,
in one or more parcels, at such time and place, upon such terms and after such notice thereof as may be required or permitted by law; 
  
 (e) institute an action, suitor proceeding in equity for the specific performance of any covenant, condition or agreement contained herein, in the Note or
in the Other Security Documents; 
  
 (f) recover judgment on the
Note either before, during or after any proceedings for the enforcement of this Security Instrument or the Other Security Documents; 
  
 (g) apply for the appointment of a receiver, trustee, liquidator or conservator of the Property, without notice and without regard for the adequacy of the
security for the Debt and without regard for the solvency of Borrower or of any person, firm or other entity liable for the payment of the Debt; 
  
 (h) subject to any applicable state or federal law, the license granted to Borrower under Section 1.2 shall automatically be revoked and Lender may enter
into or upon the Property, either personally or by its agents, nominees or attorneys and dispossess Borrower and its agents and servants therefrom, without liability for trespass, damages or otherwise and exclude Borrower and its agents or servants
wholly therefrom, and take possession of all rent rolls, leases (including the form lease and amendments and exhibits), subleases (including the form sublease and amendments and exhibits) and rental and license agreements with the tenants,
subtenants and licensees, in possession of the Property or any part or parts thereof; tenants, subtenants, and licensees, money deposits or other property (including, without limitation, any letter of credit) given to secure tenants, subtenants, and
licensees, obligations under leases, subleases or licenses, together with a list of the foregoing; all lists pertaining to current rent and license fee arrears; any and all architects, plans and specifications, licenses and permits, documents,
books, records, accounts, surveys and property which relate to the management, leasing, operation, occupancy, ownership, insurance, maintenance, or service of or construction upon the Property and Borrower agrees to surrender possession thereof and
of the Property to Lender upon demand, and thereupon Lender may (i) use, operate, manage, control, insure, maintain, repair, restore and otherwise deal with all and every part of the Property and conduct the business thereat; (ii) complete any
construction on the Property in such manner and form as Lender deems advisable; (iii) make alterations, additions, renewals, replacements and improvements to or on the Property; (iv) exercise all rights and powers of Borrower with respect to the
Property, whether in the name of Borrower or otherwise, including without limitation, the right to make, cancel, enforce or modify Leases, obtain and evict tenants, and demand, sue for, collect and receive all Rents of the Property and every part
thereof; (v) either require Borrower (A) to pay monthly in advance to Lender, or any receiver appointed to collect the Rents, the fair and reasonable rental value for the 

 
use and occupation of such part of the Property as may be occupied by Borrower, or (B) to vacate and surrender possession of the Property to Lender or to
such receiver and, in default thereof, Borrower may be evicted by summary proceedings or otherwise; and (vi) apply the receipts from the Property to the payment of the Debt, in such order, priority and proportions as Lender shall deem appropriate in
its sole discretion after deducting therefrom all expenses (including reasonable legal fees) incurred in connection with the aforesaid operations and all amounts necessary to pay the Taxes, Other Charges, Insurance Premiums and other expenses in
connection with the Property, as well as just and reasonable compensation for the services of Lender, its counsel, agents and employees; 
  
 (i) exercise any and all rights and remedies granted to a secured party upon default under the Uniform Commercial Code, including, without limiting the
generality of the foregoing: (i) the right to take possession of the Personal Property and other UCC Collateral or any part thereof, and to take such other measures as Lender may deem necessary for the care, protection and preservation of the
Personal Property and other UCC Collateral, and (ii) request Borrower at its expense to assemble the Personal Property and other UCC Collateral and make it available to Lender at a convenient place acceptable to Lender. Any notice of sale,
disposition or other intended action by Lender with respect to the Personal Property and other UCC Collateral sent to Borrower in accordance with the provisions hereof at least five (5) days prior to such action, shall constitute commercially
reasonable notice to Borrower; 
  
 (j) apply any sums held in
escrow or otherwise by Lender in accordance with the terms of this Security Instrument or any Other Security Document to the payment of the following items in any order in its sole discretion: 
  
 (i) Taxes and Other Charges; 
  
 (ii) Insurance Premiums; 
  
 (iii) interest on the unpaid principal balance of the Note;

  
 (iv) amortization of the unpaid principal
balance of the Note; and 
  
 (v) all other sums
payable pursuant to the Note, this Security Instrument and the Other Security Documents, including, without limitation, advances made by Lender pursuant to the terms of this Security Instrument; 
  
 (k) surrender the Policies maintained pursuant to Article 3 hereof, collect
the unearned Insurance Premiums and apply such sums as a credit on the Debt in such priority and proportion as Lender in its discretion shall deem proper, and in connection therewith, Borrower hereby appoints Lender as agent and attorney-in-fact
(which is coupled with an interest and is therefore irrevocable) for Borrower to collect such unearned Insurance Premiums; 
  
 (l) apply the balance of any Net Proceeds Deficiency deposit, together with interest thereon, to the payment of the Debt in such order, priority and
proportions as Lender shall deem to be appropriate in its discretion; or 

 (m) pursue such other remedies as Lender may have under applicable state or federal law. 
  
 In the event of a sale pursuant to this Section 11.1, by foreclosure, power
of sale, or otherwise, of less than all of the Property, this Security Instrument shall continue as a lien and security interest on the remaining portion of the Property unimpaired and without loss of priority. Notwithstanding the provisions of this
Section 11.1 to the contrary, if any Event of Default as described in Section 7.16) or Section 7.10) of the Credit Agreement shall occur, the entire unpaid Debt shall be automatically due and payable, without any further notice, demand or other
action by Lender. 
  
 Section 11.2 APPLICATION OF PROCEEDS.
The purchase money, proceeds and avails of any disposition of the Property, or any part thereof, or any other sums collected by Lender pursuant to the Note, this Security Instrument or the Other Security Documents, may be applied by Lender to the
payment of the Debt in such priority and proportions as Lender in its discretion shall deem proper. 
  
 Section 11.3 RIGHT TO CURE DEFAULTS. Upon the occurrence of any Event of Default or if Borrower fails to make any payment or to do any act as
herein provided, upon notice to Borrower (except in an emergency situation to protect the security hereof), Lender may, but without any obligation to do so and without releasing Borrower from any obligation hereunder, make or do the same in such
manner and to such extent as Lender may deem necessary to protect the security hereof Lender is authorized to enter upon the Property for such purposes, or appear in, defend, or bring any action or proceeding to protect its interest in the Property
or to foreclose this Security Instrument or collect the Debt. The cost and expense of any cure hereunder (including reasonable legal fees to the extent permitted by law), with interest as provided in this Section 11.3, shall constitute a portion of
the Debt and shall be due and payable to Lender upon demand. All such costs and expenses incurred by Lender in remedying such Event of Default or such failed payment or act or in appearing in, defending, or bringing any such action or proceeding
shall bear interest at the Default Rate, for the period after notice from Lender that such cost or expense was incurred to the date of payment to Lender. All such costs and expenses incurred by Lender together with interest thereon calculated at the
Default Rate (defined in the Note) shall be deemed to constitute a portion of the Debt and be secured by this Security Instrument and the Other Security Documents and shall be immediately due and payable upon demand by Lender therefor. 

 
 Section 11.4 ACTIONS AND PROCEEDINGS. With notice to Borrower,
Lender has the right to appear in and defend any action or proceeding brought with respect to the Property and, after the occurrence and during the continuance of an Event of Default, to bring any action or proceeding, in the name and on behalf of
Borrower, which Lender, in its discretion, decides should be brought to protect its interest in the Property. 
  
 Section 11.5 RECOVERY OF SUMS REQUIRED TO BE PAID. Lender shall have the right from time to time to take action to recover any sum or sums which
constitute a part of the Debt as the same become due, without regard to whether or not the balance of the Debt shall be 

 
due, and without prejudice to the right of Lender thereafter to bring an action of foreclosure, or any other action, for a default or defaults by Borrower
existing at the time such earlier action was commenced. 
  
 Section 11.6 EXAMINATION OF BOOKS AND RECORDS. Lender, its agents, accountants and attorneys shall have the right upon prior written notice to Borrower (unless an Event of Default exists, in which case no notice shall be required),
to examine and audit, during reasonable business hours, the records, books, management and other papers of Borrower and its Subsidiaries (as defined in the Credit Agreement) which pertain to their financial condition or the income, expenses and
operation of the Property, at the Property or at any office regularly maintained by Borrower or its Subsidiaries where the books and records are located. Lender and its agents shall have the right upon notice to make copies and extracts from the
foregoing records and other papers. 
  
 Section 11.7 OTHER
RIGHTS, ETC. 
  
 (a) The failure of Lender to insist upon
strict performance of any term hereof shall not be deemed to be a waiver of any term of this Security Instrument. Borrower shall not be relieved of Borrower’s obligations hereunder by reason of (i) the failure of Lender to comply with any
request of Borrower to take any action to foreclose this Security Instrument or otherwise enforce any of the provisions hereof or of the Note or the Other Security Documents, (ii) the release, regardless of consideration, of the whole or any part of
the Property, or of any person liable for the Debt or any portion thereof, or (iii) any agreement or stipulation by Lender extending the time of payment, changing the rate of interest, or otherwise modifying or supplementing the terms of the Note,
this Security Instrument or the Other Security Documents. 
  
 (b)
It is agreed that the risk of loss or damage to the Property is on Borrower, and Lender shall have no liability whatsoever for decline in value of the Property, for failure to maintain the Policies, or for failure to determine whether insurance in
force is adequate as to the amount of risks insured. Possession by Lender shall not be deemed an election of judicial relief, if any such possession is requested or obtained, with respect to any Property or collateral not in Lender’s
possession. 
  
 (c) Lender may resort for the payment of the Debt
to any other security held by Lender in such order and manner as Lender, in its discretion, may elect. Lender may take action to recover the Debt, or any portion thereof, or to enforce any covenant hereof without prejudice to the right of Lender
thereafter to foreclose this Security Instrument. The rights of Lender under this Security Instrument shall be separate, distinct and cumulative and none shall be given effect to the exclusion of the others. No act of Lender shall be construed as an
election to proceed under any one provision herein to the exclusion of any other provision. Lender shall not be limited exclusively to the rights and remedies herein stated but shall be entitled to every right and remedy now or hereafter afforded at
law or in equity. 
  
 Section 11.8 RIGHT TO RELEASE ANY PORTION
OF THE PROPERTY. Lender may release any portion of the Property for such consideration as Lender may require without, as to the remainder of the Property, in any way impairing or affecting the lien or priority of this 

 
Security Instrument, or improving the position of any subordinate lienholder with respect thereto, except to the extent that the obligations hereunder shall
have been reduced by the actual monetary consideration, if any, received by Lender for such release, and may accept by assignment, pledge or otherwise any other property in place thereof as Lender may require without being accountable for so doing
to any other lienholder. This Security Instrument shall continue as a lien and security interest in the remaining portion of the Property. 
  
 Section 11.9 VIOLATION OF LAWS. If the Property is not in material compliance with Applicable Laws, Lender may impose additional requirements upon
Borrower in connection herewith including, without limitation, monetary reserves or financial equivalents reasonably related to the non-compliance. 
  
 Section 11.10 RIGHT OF ENTRY. Lender and its agents shall have the right to enter and inspect the Property at all reasonable times upon reasonable
notice. 
  
 Section 11.11 SUBROGATION. If any or all of the
proceeds of the Note have been used to extinguish, extend or renew any indebtedness heretofore existing against the Property, then, to the extent of the funds so used, Lender shall be subrogated to all of the rights, claims, liens, titles, and
interests existing against the Property heretofore held by, or in favor of, the holder of such indebtedness and such former rights, claims, liens, titles, and interests, if any, are not waived but rather are continued in full force and effect in
favor of Lender and are merged with the lien and security interest created herein as cumulative security for the repayment of the Debt, the performance and discharge of Borrower’s obligations hereunder, under the Note and the Other Security
Documents and the performance and discharge of the Other Obligations. 
  
 Section 11.12 POWER OF ATTORNEY. 
  
 (a) The
Borrower hereby irrevocably constitutes and appoints the Lender and any officer or agent thereof, with full power of substitution, as its true and lawful attorneys-in-fact with full irrevocable power and authority in the place and stead purpose of
the Borrower or in the Lender’s own name, for the purposes of carrying out the terms of this Security Instrument, to take any and all appropriate action and to execute any and all documents and instruments that may be necessary or useful to
accomplish the purposes of this Security Instrument and, without limiting the generality of the foregoing, hereby gives said attorneys the power and right, on behalf of the Borrower, upon notice to the Borrower, to, upon the occurrence and during
the continuance of an Event of Default, sell, transfer, pledge, make any agreement with respect to or otherwise dispose of or deal with any of the Property in such manner as is consistent with the Uniform Commercial Code and as fully and completely
as though the Lender were the absolute owner thereof for all purposes, and to do, at the Borrower’s expense, at any time, or from time to time, all acts and things which the Lender deems necessary or useful to protect, preserve or realize upon
the Property and the Lender’s security interest therein, in order to effect the intent of this Security Instrument, all no less fully and effectively as the Borrower might do; and 
  
 (b) To the extent permitted by law, the Borrower hereby ratifies all that said attorneys shall lawfully do or cause to be
done by virtue hereof. This power of attorney is a power coupled with an interest and is irrevocable. 

 (c) The powers conferred on the Lender hereunder are solely to protect its interests in the Property and
shall not impose any duty upon it to exercise any such powers. The Lender shall be accountable only for the amounts that it actually receives as a result of the exercise of such powers, and neither it nor any of its officers, directors, employees or
agents shall be responsible to the Borrower for any act or failure to act. 
  
 Article 12 - ENVIRONMENTAL HAZARDS 
  
 Section 12.1 ENVIRONMENTAL REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants that: (a) there are no Hazardous Materials (defined below) or underground storage tanks in, on, or under the Property,
except those that are both (i) in compliance with Environmental Laws and with permits issued pursuant thereto (if such permits are required), and (ii) either (A) in amounts not in excess of that necessary to operate the Property or (B) fully
disclosed in writing pursuant to the written reports resulting from the environmental site assessments of the Property delivered to Lender prepared by Commercial Property ESA Program (the “Environmental Report”); (b) there are no known
past, present or threatened Releases (defined below) of Hazardous Materials in violation of any Environmental Law and which would require remediation by a governmental authority in, on, under or from the Property except as described in the
Environmental Report; (c) there is no known threat of any Release of Hazardous Materials migrating to the Property except as described in the Environmental Report; (d) there is no known past or present non-compliance with Environmental Laws, or with
permits issued pursuant thereto, in connection with the Property except as described in the Environmental Report; (e) Borrower does not know of, and has not received, any written or oral notice or other communication from any person or entity
(including but not limited to a governmental entity) relating to Hazardous Materials in, on, under or from the Property; and (f) Borrower has truthfully and hilly provided to Lender, in writing, any and all information relating to environmental
conditions in, on, under or from the Property known to Borrower or contained in Borrower’s files and records, including but not limited to any reports relating to Hazardous Materials in, on, under or migrating to or from the Property and/or to
the environmental condition of the Property. “Environmental Law” means any present and future federal, state and local laws, statutes, ordinances, rules, regulations, standards, policies and other government directives or requirements, as
well as common law, that apply to Borrower or the Property and relate to Hazardous Materials, including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act and the Resource Conservation and Recovery Act.
“Hazardous Materials” shall mean petroleum and petroleum products and compounds containing them, including gasoline, diesel fuel and oil; explosives; flammable materials; radioactive materials; polychlorinated biphenyls and compounds
containing them; lead and lead-based paint; asbestos or asbestos-containing materials in any form that is or could become friable; underground or above-ground storage tanks, whether empty or containing any substance; any substance the presence of
which on the Property is prohibited by any federal, state or local authority; any substance that requires special handling; and any other material or substance now or in the future defined as a “hazardous substance,” “hazardous
material,” “hazardous waste,” “toxic substance,” “toxic pollutant,” “contaminant,” “pollutant” or other words of similar import within the meaning of any Environmental Law. “Release”
of any Hazardous Materials includes but is not limited to any release, deposit, discharge, emission, 

 
leaking, spilling, seeping, migrating, injecting, pumping, pouring, emptying, escaping, dumping, disposing or other movement of Hazardous Materials.

  
 Section 12.2 ENVIRONMENTAL COVENANTS. Borrower
covenants and agrees that so long as Borrower owns, manages, is in possession of, or otherwise controls the operation of the Property: (a) all uses and operations on or of the Property, whether by Borrower or any other person or entity, shall be in
compliance, in all material respects, with all Environmental Laws and permits issued pursuant thereto; (b) there shall be no Releases of Hazardous Materials in, on, under or from the Property; (c) there shall be no Hazardous Materials in, on, or
under the Property, except those that are both (i) in compliance with all Environmental Laws and with permits issued pursuant thereto, if and to the extent required, and (ii) (A) in amounts not in excess of that necessary to operate the Property or
(B) fully disclosed to and approved by Lender in writing; (d) Borrower shall keep the Property free and clear of all liens and other encumbrances imposed pursuant to any Environmental Law, whether due to any act or omission of Borrower or any other
person or entity (the “Environmental Liens”); (e) Borrower shall, at its sole cost and expense, fully and expeditiously cooperate in all activities pursuant to Section 12.3 below, including but not limited to providing all relevant
information and making knowledgeable persons available for interviews; (f) Borrower shall, at its sole cost and expense, perform any environmental site assessment or other investigation of environmental conditions in connection with the Property,
pursuant to any reasonable written request of Lender, upon Lender’s reasonable belief that the Property is not in compliance (in all material respects) with all Environmental Laws, and share with Lender the reports and other results thereof;
and Lender and other Indemnified Parties hereinafter defined shall be entitled to rely on such reports and other results thereof; (g) Borrower shall, at its sole cost and expense, comply with all reasonable written requests of Lender to (i)
reasonably effectuate remediation of any Hazardous Materials in, on, under or from the Property; and (ii) comply with any Environmental Law; (h) Borrower shall not allow any tenant or other user of the Property to violate any Environmental Law; and
(i) Borrower shall immediately notify Lender in writing after it has become aware of (A) any presence or Release or threatened Release of Hazardous Materials in, on, under, from or migrating towards the Property; (B) any material non-compliance with
any Environmental Laws related in any way to the Property; (C) any actual or potential Environmental Lien against the Property; (D) any required or proposed remediation of environmental conditions relating to the Property; and (E) any written or
oral notice or other communication of which Borrower becomes aware from any source whatsoever (including but not limited to a governmental entity) relating in any way to Hazardous Materials. 
  
 Section 12.3 LENDER’S RIGHTS. Lender and any other person or
entity designated by Lender, including but not limited to any representative of a governmental entity, and any environmental consultant, and any receiver appointed by any court of competent jurisdiction, shall have the right, but not the obligation
upon Lender’s reasonable belief that any one of the covenants set forth in Section 12.2 have not been complied with, to enter upon the Property at all reasonable times, after reasonable notice, to assess any and all aspects of the environmental
condition of the Property and its use, including but not limited to conducting any environmental assessment or audit (the scope of which shall be determined in Lender’s sole and absolute discretion) and taking samples of soil, groundwater or
other water, air, or building materials, and conducting other invasive testing. Borrower shall cooperate with and provide access to Lender and any such person or entity designated by Lender. 

 Article 13 - INDEMNIFICATIONS 
  
 Section 13.1 GENERAL INDEMNIFICATION. Borrower shall, at its sole cost and expense, protect, defend, indemnify,
release and hold harmless Lender, its affiliates, and each of their officers, directors, employees, agents and advisors (the “Indemnified Parties) from and against any and all Losses (defined below) imposed upon or incurred by or asserted
against any Indemnified Parties and directly or indirectly arising out of or in any way relating to any one or more of the following: (a) any accident, injury to or death of persons or loss of or damage to property occurring in, on or about the
Property or any part thereof or on the adjoining sidewalks, curbs, adjacent property or adjacent parking areas, streets or ways; (b) any use, nonuse or condition in, on or about the Property or any part thereof or on the adjoining sidewalks, curbs,
adjacent property or adjacent parking areas, streets or ways; (c) performance of any labor or services or the furnishing of any materials or other property in respect of the Property or any part thereof; (d) any failure of the Property to be in
compliance with any Applicable Laws; (e) any and all claims and demands whatsoever which may be asserted against Lender by reason of any alleged obligations or undertakings on its part to perform or discharge any of the terms, covenants, or
agreements contained in any Lease; or (f) the payment of any commission, charge or brokerage fee to anyone which may be payable in connection with the funding of the Loan evidenced by the Note and secured by this Security Instrument. Any amounts
payable to Lender by reason of the application of this Section 13.1 shall become immediately due and payable and shall bear interest at the Default Rate from the date loss or damage is sustained by Lender until paid. 
  
 The term “Losses” shall mean any and all claims, suits, liabilities
(including, without limitation, strict liabilities), actions, proceedings, obligations, debts, damages, losses, costs, expenses, fines, penalties, charges, fees, judgments, awards, amounts paid in settlement of whatever kind or nature (including but
not limited to legal fees and other costs of defense). 
  
 Section
13.2 MORTGAGE AND/OR INTANGIBLE TAX. Borrower shall, at its sole cost and expense, protect, defend, indemnify, release and hold harmless the Indemnified Parties from and against any and all Losses imposed upon or incurred by or asserted
against any Indemnified Parties and directly or indirectly arising out of or in any way relating to any tax on the making and/or recording of this Security Instrument, the Note or any of the Other Security Documents. 
  
 Section 13.3 DUTY TO DEFEND, LEGAL FEES AND OTHER FEES AND EXPENSES.
Upon written request by any Indemnified Party, Borrower shall defend such Indemnified Party (if requested by any Indemnified Party, in the name of the Indemnified Party) by attorneys and other professionals approved by the Indemnified Parties.
Notwithstanding the foregoing, any Indemnified Parties may, in their sole discretion, engage their own attorneys and other professionals to defend or assist them, and, at the option of Indemnified Parties, their attorneys shall control the
resolution of any claim or proceeding. Upon demand, Borrower shall pay or, in the sole discretion of the Indemnified Parties, reimburse, the Indemnified Parties for the payment of reasonable fees and disbursements of attorneys, engineers,
environmental consultants, laboratories and other professionals in connection therewith. 

 Section 13.4 ENVIRONMENTAL INDEMNITY. Simultaneously with this Security Instrument, Borrower has
executed and delivered that certain environmental indemnity agreement dated the date hereof to Lender (the “Environmental Indemnity”), which Environmental Indemnity is not secured by this Security Instrument. 
  
 Article 14 - WAIVERS 
  
 Section 14.1 WAIVER OF COUNTERCLAIM. Borrower hereby waives the right
to assert a counterclaim, other than a mandatory or compulsory counterclaim, in any action or proceeding brought against it by Lender arising out of or in any way connected with this Security Instrument, the Note, the Credit Agreement, any of the
Other Security Documents, or the Obligations. 
  
 Section 14.2
MARSHALLING AND OTHER MATTERS. Borrower hereby waives, to the extent permitted by law, the benefit of all appraisement, valuation, stay, extension, reinstatement and redemption laws now or hereafter in force and all rights of marshalling in
the event of any sale hereunder of the Property or any part thereof or any interest therein. Further, Borrower hereby expressly waives any and all rights of redemption from sale under any order or decree of foreclosure of this Security Instrument on
behalf of Borrower, and on behalf of each and every person acquiring any interest in or title to the Property subsequent to the date of this Security Instrument and on behalf of all persons to the extent permitted by Applicable Law. 
  
 Section 14.3 WAIVER OF NOTICE. Borrower shall not be entitled to any
notices of any nature whatsoever from Lender except (a) with respect to matters for which this Security Instrument specifically and expressly provides for the giving of notice by Lender to Borrower and (b) with respect to matters for which Lender is
required by Applicable Law to give notice, and Borrower hereby expressly waives the right to receive any notice from Lender with respect to any matter for which this Security Instrument does not specifically and expressly provide for the giving of
notice by Lender to Borrower. 
  
 Section 14.4 WAIVER OF
STATUTE OF LIMITATIONS. Borrower hereby expressly waives and releases to the fullest extent permitted by law, the pleading of any statute of limitations as a defense to payment of the Debtor performance of its Other Obligations. 
  
 Section 14.5 SOLE DISCRETION OF LENDER. Wherever pursuant to this
Security Instrument (a) Lender exercises any right given to it to approve or disapprove, (b) any arrangement or term is to be satisfactory to Lender, or (c) any other decision or determination is to be made by Lender, the decision to approve or
disapprove all decisions that arrangements or terms arc satisfactory or not satisfactory, and all other decisions and determinations made by Lender, shall be in the sole discretion of Lender, except as may be otherwise expressly and specifically
provided herein. 
  
 Section 14.6 WAIVER OF TRIAL BY JURY.
BORROWER AND LENDER, BY ACCEPTANCE OF THIS SECURITY INSTRUMENT, HEREBY WAIVE, TO THE 

 
FULLEST EXTENT PERMITTED BY LAW, THE RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM, WHETHER IN CONTRACT, TORT OR OTHERWISE, RELATING
DIRECTLY OR INDIRECTLY TO THE LOAN, THE APPLICATION FOR THE LOAN, THE NOTE, THIS SECURITY INSTRUMENT OR THE OTHER SECURITY DOCUMENTS OR ANY ACTS OR OMISSIONS OF LENDER OR BORROWER. 
  
 Section 14.7 WAIVER OF FORECLOSURE DEFENSE. Borrower hereby waives any defense Borrower might assert or have by
reason of Lender’s failure to make any tenant or lessee of the Property a party defendant in any foreclosure proceeding or action instituted by Lender. 
  
 Article 15 – SPECIAL MINNESOTA PROVISIONS 
  
 Section 15.1 INCONSISTENCIES. In the event of any inconsistency between the terms and conditions of the other articles and provisions of this
Security Instrument and this Article 15, the terms and conditions of this Article 15 shall control and be binding. 
  
 Section 15.2 POWER OF SALE. Upon the occurrence of an Event of Default, Borrower hereby authorizes Lender to sell, either by judicial process or
advertisement, the Property either as one tract or otherwise at public action and convey the same to the purchaser, as provided by law. Borrower acknowledges that in such event, Borrower will remain liable for any deficiency to the extent permitted
by law. 
  
 Section 15.3 REPRESENTATIONS, WARRANTIES AND
COVENANTS. The following is hereby added to Section 5.2: 
  
 “(x)
“(m) The Property is not agricultural property, property in agricultural use, nor the homestead of Borrower.” 
  
 Section 15.4 ASSIGNMENT OF LEASES. (i) The following two paragraphs are hereby added to Section 1.2 and 1.3 respectively: 
  
 “This Security Instrument constitutes an assignment of rents and profits
within the meaning of Minnesota Statutes, §§ 559.17 and 576.01, and is intended to comply fully with the provisions thereof, and to afford Lender, to the fullest extent allowed by law, the right and remedies of a mortgage lender or secured
lender pursuant thereto, including, without limitation, the right of a receiver to apply excess cash in the manner provided in such statutes from the date of appointment through the entire redemption period from any foreclosure sale. Lender may
enter and take possession of the Property and manage and operate the same and take any action which, in Lender’s judgment, is necessary or proper to collect the Rents and to conserve the value of the Property. Lender may also take possession of
and for these purposes use, any and all personal property. The expense (including any receiver’s fees, attorneys’ fees, costs and agent’s compensation) incurred pursuant to the powers herein contained shall be secured by this Security
Instrument. Lender shall not be liable to account for any Rents actually received by Lender. Enforcement hereof shall not cause Lender to be deemed a mortgagee in possession unless Lender elects in writing to be a mortgagee in possession. Lender
also shall have the right 

 
to enter and take possession of the Property and manage and operate the same in conformity with all applicable laws and take any action which, in
Lender’s judgment, is necessary or proper to conserve the value of the Property.” 
  
 “This Security Instrument also constitutes a security agreement within the meaning of the Uniform Commercial Code as in effect in the State of Minnesota (the “UCC”), with respect to all property
described herein as to which a security interest may be granted and/or perfected pursuant to the UCC, and in intended to afford Lender, to the fullest extent allowed by law, the rights and remedies of a secured party under the UCC, including,
without limitation, the right of a receiver to apply excess cash in the manner provided in such statutes from the date of appointment through the entire redemption period from any foreclosure sale.” 
  
 Section 15.5 APPOINTMENT OF A RECEIVER OR TRUSTEE. Section 11.1(g) is
hereby replaced with: 
  
 “Lender may apply for the
appointment of a receiver to the district court for the county where the Property or any part thereof is located, by an action separate from any foreclosure of this Security instrument pursuant to Minnesota Statutes Chapter 580 or pursuant to
Minnesota Statutes Chapter 581, or as a part of the foreclosure action under said Chapter 581 (it being agreed that the existence of a foreclosure pursuant to said Chapter 580 or a foreclosure action pursuant to said Chapter 581 is not a
prerequisite to any action for a receiver hereunder). Lender shall be entitled to the appointment of a receiver without regard to waste, adequacy of the security or solvency of Borrower. The receiver, who shall be an experienced property manager,
shall collect (until the obligations secured hereby are fully paid and satisfied and, in the case of a foreclosure sale, during the entire redemption period) the Rents, and shall manage the Property, execute leases within or beyond the period of the
receivership if approved by the court and apply all rents, profits and other income collected by him in the following order: 
  
 (a) to the payment of all reasonable fees of the receiver, if any, approved by the court; 
  
 (b) to the repayment of tenant security deposits, with interest thereon, as required by Minnesota Statutes, Section 504B.
178; 
  
 (c) to the payment when due of delinquent or current real
estate taxes or special assessments with respect to the Property, or the periodic escrow for the payment of the same; 
  
 (d) to the payment when due of premiums for insurance of the type required by this Security instrument, or the periodic escrow for the payment of the
same; 
  
 (e) to the payment for the keeping of the covenants
required of a lessor or licensor pursuant to Minnesota Statutes, Section 504B. 161; 
  
 (f) to the payment of all expenses for normal maintenance of the Property; and 
  
 (g) the balance to Lender (a) if received prior to the commencement of a foreclosure, to be applied to the obligations secured hereby, in such order as
Lender may elect and (b) if 

 
received after the commencement of a foreclosure, to be applied to the amount required to be paid to effect a reinstatement prior to foreclosure sale, or,
after a foreclosure sale to any deficiency and thereafter to the amount required to be paid to effect a redemption, all pursuant to Minnesota Statutes, Section 580.30, 580.23 and 581.10, with any excess to be paid to Borrower. Provided, that if this
Security instrument is not reinstated nor the Property redeemed as provided by said Section 580.30, 580.23 or 581.10, the entire amount paid to Lender pursuant thereto shall be the property of Lender together with all or any part of the Property
acquired through foreclosure. 
  
 Lender shall have the right, at
any time and without limitation, as provided in Minnesota Statutes, Section 582.03, to advance money to the receiver to pay any part or all of the items which the receiver should otherwise pay if cash were available from the Property and sums so
advanced, with interest at the Default Rate set forth in the Note, shall be secured hereby, or if advanced during the period of redemption shall be part of the sum required to be paid to redeem from the sale.” 
  
 Section 15.6 OTHER REMEDIES. The following is hereby added to Section
11.1(b): 
  
 “In the event of any sale of the Property
pursuant to any judgment or decree of any court or at public auction or otherwise in connection with the enforcement of any of the terms of this Security Instrument, Lender, its successors or assigns, may become the purchaser, and for the purpose of
making settlement for or payment of the purchase price, shall be entitled to deliver over and use the Note and any claims for interest accrued and unpaid thereon, together with all other sums with interest, advanced or secured hereby and unpaid
hereunder, in order that there may be credited as paid on the purchase price the total amount of the obligations secured hereby then due, including principal and interest on the Note and all other sums, with interest, advanced or secured hereby and
unpaid hereunder or under any of the other Loan Documents. Further, if following the occurrence of any Event of Default, the Property is sold at a foreclosure sale and Borrower subsequently exercises its right of redemption, an amount equal to the
applicable Prepayment Fee and Yield Maintenance Amount specified in the Note, if any, shall be added to the redemption price.” 
  
 Section 15.7 MORTGAGE REGISTRY TAX. Borrower expressly agrees to pay the Mortgage Registry Tax under Minn. Stat. §287.05 (as the same may be
amended or recodified) and any other tax or fee which is based on the amount secured by this mortgage or of which the payment is a prerequisite for the enforceability, effectiveness or primary priority of this Security Instrument, whether such
amounts are due at the time of the making or filing for record of this Security Instrument or any time thereafter. 
  
 Section 15.8 MULTI-STATE MORTGAGE: 
  
 (a) This Mortgage is a “multistate mortgage” as defined in Minn. Stat. §287.05. This Mortgage also encumbers the real property located
outside of the state of Miimesota described in Exhibit A-2 (the “Multistate Property”). Borrower has also executed and delivered to Lender additional mortgages of even date encumbering the Multistate Property (the “Multistate
Instruments”). If Lender releases any of the Multistate Property from the lien of a Multistate 

 
Instrument or delivers a satisfaction of a Multistate Instrument, the Multistate Property described in such release or satisfaction shall be automatically
released from the lien of this Mortgage to the same extent as described in such release or satisfaction. The provisions of the foregoing sentence shall be self-operative and shall not require the filing of a release or satisfaction in the State of
Minnesota. Borrower expressly acknowledges and agrees that any release or satisfaction of this Mortgage shall not operate to release any property outside of the State of Minnesota from the lien of any Multistate Instrument unless such release or
satisfaction expressly describes such property as being released or such Multistate Instrument as being satisfied. 
  
 (b) To the extent that this Security Instrument secures future advances other than the advances evidenced by the Note, the amount of such advances is not
currently known. The acceptance of this Security Instrument by Lender, however, constitutes an acknowledgement that Lender is aware of the provisions of Minnesota Statutes §287.05, Subd. 5, and intends to comply with the requirements contained
therein. 
  
 (c) The representations contained in this Section are
made solely for the benefit of county recording authorities in determining the mortgage registry tax payable as a prerequisite to the recording of this Security instrument. The Borrower acknowledges that such representations do not constitute or
imply an agreement by the Lender to make any future advances to the Borrower. 
  
 (d) Notwithstanding any other provision of this Security Instrument or any of the Loan Documents to the contrary, any amounts as to which Registry Tax is payable shall not be secured by this Security Instrument unless
and until the tax is paid. 
  
 Section 15.9 MATURITY. The
obligations secured hereby shall mature on or before August 1, 2009. 
  
 Section 15.10 FIXTURE FINANCING STATEMENT. From the date of its recording, this Security Instrument shall be effective as a financing statement with respect to all goods and Personal Property constituting part of the Property which
are or are to become fixtures related to the Land and Improvements described herein. For this purpose, the following information is set forth: 
  

					
			
	 (a)
	  	Name of Debtor:	  	Cybex International, Inc.
			
	 	  	Address of Debtor:	  	 10 Trotter Drive
 Medway, Massachusetts
11779

			
	 	  	Debtor’s tax identification number:	  	11-1731581
			
	 	  	Name of Secured Party:	  	GMAC Commercial Finance LLC
			
	 	  	Address of Secured Party	  	 210 Interstate North Parkway, Suite 315,
 Atlanta,
Georgia 30339

 (b) Description of the types (or items) of property covered by this Fixture Filing - see Section 1.1.

  
 (c) Description of the Real Estate to which the property
described above is attached or upon which it is located - see Exhibit A attached hereto. 
  
 (d) This document covers goods which are or are to become fixtures. 
  
 (e) The record owner of the Land is Borrower. 
  
 (f) Borrower is a corporation organized under the laws of the State of New York. 
  
 (g) Borrower’s organizational identification number is 23323. 
  
 Article 16 - NOTICES 
  
 Section 16.1 NOTICES. All notices or other written communications
hereunder shall be given in accordance with the terms of the Credit Agreement. 
  
 Article 17 - CHOICE OR LAW/SUBMISSION TO JURISDICTION 
  
 Section 17.1 CHOICE OF LAW. This Security Instrument shall be deemed to be a contract entered into pursuant to the laws of the State of New York and shall in all respects be governed, construed, applied and
enforced in accordance with the laws of the State of New York, provided however, that with respect to the creation, perfection, priority and enforcement of the lien of this Security Instrument, and the determination of deficiency judgments, the laws
of the state where the Property is located shall apply. 
  
 Section 17.2 PROVISIONS SUBJECT TO LAW. All rights, powers and remedies provided in this Security Instrument may be exercised only to the extent that the exercise thereof does not violate any applicable state or federal law and are
intended to be limited to the extent necessary so that they will not render this Security Instrument invalid, unenforceable or not entitled to be recorded, registered or filed under any applicable state or federal law. 
  
 Section 17.3 SUBMISSION To JURISDICTION. With respect to any claim or
action arising hereunder or under the Note, the Credit Agreement or the Other Security Documents, Borrower (a) irrevocably submits to the nonexclusive jurisdiction of the courts of the State of New York and the United States District Court located
in the City of New York, in the State of New York, and appellate courts from any thereof, (b) irrevocably waives any objection which it may have at any time to the laying on venue of any suit, action or proceeding arising out of or relating to this
Security Instrument brought in any such court, and (c) irrevocably waives any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. Nothing in this Security Instrument will be deemed to
preclude Lender from bringing an action or proceeding with respect hereto in any other jurisdiction. 

 Article 18 - SECONDARY MARKET 
  
 Section 18.1 TRANSFER OF LOAN. Lender may, at any time, sell, transfer or assign the Note, the Credit Agreement, this
Security Instrument and the Other Security Documents, and any or all servicing rights with respect thereto, or grant participations therein (the “Participations”) or issue mortgage pass-through certificates or other securities evidencing a
beneficial interest in a rated or unrated public offering or private placement (the “Securities”). Lender may forward to each purchaser, transferee, assignee, servicer, participant, or investor in such Participations or Securities
(collectively, the “Investor”) or any Rating Agency rating such Securities, each prospective Investor, and any organization maintaining databases on the underwriting and performance of commercial mortgage loans, all documents and
information which Lender now has or may hereafter acquire relating to the Debt, the Borrower or the Property, whether furnished by Borrower or otherwise, as Lender determines necessary or desirable, provided that such Investor, prospective Investor
or Rating Agency is informed that such information is confidential and agrees to maintain its confidentiality and not to use such information other than to evaluate a potential purchase of an interest in the Loan (as such term is defined in the
Credit Agreement). Borrower irrevocably waives any and all rights it may have under Applicable Laws to prohibit such disclosure, including but not limited to any right of privacy. 
  
 Section 18.2 COOPERATION. Borrower agrees to cooperate with Lender in connection with any transfer made or any
Securities created pursuant to this Section, including, without limitation, the delivery of an estoppel certificate required in accordance with Section 7.4(c) hereof and such other documents as may be reasonably requested by Lender. Borrower shall
also furnish and Borrower consents to Lender furnishing to such Investors or such prospective Investors or such Rating Agency any and all information concerning the Property, the Leases, the financial condition of Borrower as may be requested by
Lender, any Investor, any prospective Investor or any Rating Agency in connection with any sale, transfer, Participations or Securities, provided that such Investor, prospective Investor or Rating Agency is informed that such information is
confidential and agrees to maintain its confidentiality and not to use such information other than to evaluate a potential purchase of an interest in the Loan (as such term is defined in the Credit Agreement). 
  
 Section 18.3 RESERVES/ESCROWS. In the event that Securities are issued
in connection with the Loan, all funds held by Lender in escrow or pursuant to reserves in accordance with this Security Instrument or the Other Security Documents shall be deposited in eligible accounts at eligible institutions as then defined and
required by the Rating Agencies. 
  
 Article 19 - COSTS

  
 Section 19.1 PERFORMANCE AT BORROWER’S
EXPENSE. Borrower acknowledges and confirms that Lender shall impose certain administrative processing and/or commitment fees in connection with (a) the extension, renewal, modification, amendment and termination of the Loan, (b) the release or
substitution of collateral therefor, (c) obtaining certain consents, waivers and approvals with respect to the Property, or (d) the review of any Lease or proposed Lease or the preparation or review of any subordination, non-disturbance agreement
(the occurrence of any of the above shall be called an Event”). Borrower further acknowledges 

 
and confirms that it shall be responsible for the payment of all costs of reappraisal of the Property or any part thereof, required by law, regulation,
Lender (upon the occurrence of an Event of Default or if the Property shall be destroyed in whole or in part) or any governmental or quasi-governmental authority. Borrower hereby acknowledges and agrees to pay, immediately, with or without demand,
all such fees (as the same may be increased or decreased from time to time), and any additional fees of a similar type or nature which may be imposed by Lender from time to time, upon the occurrence of any Event or otherwise. Wherever it is provided
for herein that Borrower pay any costs and expenses, such costs and expenses shall include, but not be limited to, all reasonable legal fees of Lender. 
  
 Section 19.2 LEGAL FEES FOR ENFORCEMENT. (a) Borrower shall pay all reasonable legal fees incurred by Lender in connection with (i) the preparation
of the Note, the Credit Agreement, this Security Instrument and the Other Security Documents; and (ii) the items set forth in Section 19.1 above, and (b) Borrower shall pay to Lender on demand any and all expenses, including legal fees incurred or
paid by Lender in protecting its interest in the Property or in collecting any amount payable under the Note, the Credit Agreement, this Security Instrument or the Other Security Documents, or in enforcing its rights hereunder with respect to the
Property, whether or not any legal proceeding is commenced hereunder or thereunder, together with interest thereon at the Default Rate from the date paid or incurred by Lender until such expenses are paid by Borrower. 
  
 Article 20 - DEFINITIONS 
  
 Section 20.1 GENERAL DEFINITIONS. Unless the context clearly indicates
a contrary intent or unless otherwise specifically provided herein, words used in this Security Instrument may be used interchangeably in singular or plural form and the words “Applicable Laws” shall mean all existing and future federal,
state and local laws, orders, ordinances, governmental rules and regulations and court orders and the word “Borrower” shall mean “each Borrower and any subsequent owner or owners of the Property or any part thereof or any interest
therein,” the word “Lender” shall mean “Lender and any subsequent holder of the Note,” the word “Note” shall mean “the Note and any other evidence of indebtedness secured by this Security Instrument,” the
word “person” shall include an individual, corporation, limited liability company, partnership, trust, unincorporated association, government, governmental authority, and any other entity, the word “Property” shall include any
portion of the Property and any interest therein, and the phrase “legal fees” and “counsel fees” shall include any and all reasonable counsel, attorney, paralegal and law clerk fees and disbursements, including, but not limited
to fees and disbursements at the pre-trial, trial and appellate levels incurred or paid by Lender in protecting its interest in the Property, the Leases and the Rents and enforcing its rights hereunder, whether with respect to retained firms, the
reimbursement for the expenses of in-house staff or otherwise. 
  
 Section 20.2 HEADINGS, ETC. The headings and captions of various Articles and Sections of this Security Instrument are for convenience of reference only and are not to be construed as defining or limiting, in any way, the scope or
intent of the provisions hereof 

 Article 21 - MISCELLANEOUS PROVISIONS 
  
 Section 21.1 No ORAL CHANGE. This Security Instrument, and any provisions hereof, may not be modified, amended,
waived, extended, changed, discharged or terminated orally or by any act or failure to act on the part of Borrower or Lender, but only by an agreement in writing signed by the party against whom enforcement of any modification, amendment, waiver,
extension, change, discharge or termination is sought. 
  
 Section
21.2 LIABILITY. This Security Instrument shall be binding upon and inure to the benefit of Borrower and Lender and their respective successors and assigns forever. 
  
 Section 21.3 INAPPLICABLE PROVISIONS. If any term, covenant or condition of the Note, the Credit Agreement, or this
Security Instrument is held to be invalid, illegal or unenforceable in any respect, the Note, the Credit Agreement and this Security Instrument shall be construed without such provision. 
  
 Section 21.4 DUPLICATE ORIGINALS; COUNTERPARTS. This Security Instrument may be executed in any number of duplicate
originals and each duplicate original shall be deemed to be an original. This Security Instrument may be executed in several counterparts, each of which counterparts shall be deemed an original instrument and all of which together shall constitute a
single Security Instrument. The failure of any party hereto to execute this Security Instrument, or any counterpart hereof, shall not relieve the other signatories from their obligations hereunder. 
  
 Section 21.5 NUMBER AND GENDER. Whenever the context may require, any
pronouns used herein shall include the corresponding masculine, feminine or neuter forms, and the singular form of nouns and pronouns shall include the plural and vice versa. 
  
 [NO FURTHER TEXT ON THIS PAGE] 

 IN WITNESS WHEREOF, this Security Instrument has been executed by Borrower the day and year first above
written. 
  

			
	 CYBEX INTERNATIONAL, INC.

		
	By:	 	 
	 Name:
	 	 Arthur W. Hicks, Jr.

	 Title:
	 	 Vice President; Chief Financial Officer

 ACKNOWLEDGMENT 
  
 STATE OF
                               ) 
                                        
            ) ss. 
 COUNTY OF
                           ) 
  
 The foregoing instrument was acknowledged before me this
             day of July, 2004, by ARTHUR W. HICKS, JR. the Vice President; Chief Financial Officer of CYBEX INTERNATIONAL, INC., a corporation formed tinder the Jaws of the state of
New York, on behalf of the corporation. 
  

	
	
	 
	 Notary Public

 EXHIBIT A-1 
  
 (Description of Land located in Minnesota) 
  
 Real Property in the County of Steele, State of Minnesota, described as follows: 
  

Lots 5 and 7, Block 2, Owatonna Interstate Industrial Park, recorded as Document No. 166333, and Lot 6, Block 2, Owatonna Interstate Industrial Park, recorded as
Document No. 166333, except that pan of said Lot 6 lying Easterly of the following described line: 
  
 Commencing at the northeast corner of said Lot 6; thence South 55 degrees 00 minutes West, assumed bearing, 165.00 feet along the southeasterly line of said Lot 6 to the True Point of Beginning; thence North 28
degrees 38 minutes 43 seconds West 103.90 feet to the north line of said Lot 6, last said point being South 88 degrees 55 minutes 44 seconds West 185.00 feet from the northeast corner of said Lot 6, and there terminating; according to the recorded
plat thereof Steele County, Minnesota. 
  
 Property Address: 151
25th Avenue 
                               Owatonna, Minnesota 

 EXHIBIT A-2 
  
 (Description of Land located outside Minnesota) 
  
 A certain parcel of land situated on the northerly side of Alder Street in Medway, Norfolk County, Massachusetts, together with any buildings thereon, being shown as Lot
I on a plan entitled “Plan of Land for Highway Purposes in Medway, Mass” prepared by Gerald T. Carey, recorded wit the Norfolk County Registry of Deeds in Plan Book 304, Plan 664, more particularly described as follows: 
  
 SOUTHERLY by said Alder Street in three courses, a total of 767.21 feet, according to said
Plan; 
  
 WESTERLY by lands shown on said plan as of RIR Para Corp., and as
Conservation Area, in four courses measuring, respectively, 40.00 +/- feet, 65.30 +/- feet, 93.50 +/- feet and 728.42 feet, according to said plan; 
  
 NORTHWESTERLY by lands shown on said plan as Conservation Area, as of the Town of Medway, as the end of a private way, as now or formerly of Pelkey and William, as the
end of another private way, as of Carson, and as now or formerly of Hunter, in four courses, measuring respectively 91.49 feet, 465.80 feet, 275.56 feet and 183.89 feet according to said plan; 
  
 NORTHEASTERLY by land shown on said plan as of the Town of Medway, 188.93 feet, according to
said plan; and 
  
 EASTERLY by Lot 2 as shown on said plan in four courses,
measuring respectively 111.27 feet, 135.21 feet, 104.34 feet and 1,191.43 feet, according to said plan. 
  
 Said parcel is also shown as Lot 1R and Lot 2R on a plan entitled “Plan of Land, Medway, Massachusetts” dated May 25, 2001, owner-applicant,
Cybex International. Prepared by GLM Engineering Consultants, Inc. to which plan reference is made for a more particular description. 
  
 Said plan is recorded at the Norfolk Registry of Deeds No. 385 of 2001 in Book 487. 

 EXHIBIT C 
  

	1.	Hot New Products, Inc. d/b/a Fitnesszone v. Trotter, Inc. and Cybex International, Inc., CV 98-JEO-1730-S, United States District Court for the Northern District of Alabama,
Southern Division. 

  

	2.	Gary J. Colassi v. Cybex International, Inc., Civil Action 02-11909 RWZ, United States District Court for the District of Massachusetts. 

  

	3.	Free Motion Fitness, Inc. f/k/a Ground Zero Design Corporation v. Cybex International, Inc., 1:01CV00152 BSJ, United States District Court for the District of Utah.

  

	4.	Gene Kirilla, II, et al v. Cybex International, Inc., et al, Civil Division G.D. No. 1997-1725, Court of Common Pleas of Mercer County, Pennsylvania.

  

	5.	The Company in the ordinary course of business is subject to product liability and similar litigation, all of which the Company believes is covered by insurance.

  

	6.	Additionally, the Company has received notice from Biosig Instruments, Inc. of allegations by Biosig that the heart rate monitors the Company uses in its treadmills infringe U.S.
Patent 5,337,753 and Canadian Patent 2,033,014, both allegedly owned by Biosig. As the Company purchases these monitors from a third party supplier, the Company believes itself to be indemnified for any damages The Company has received an opinion on
non-infringement from patent counsel and believes the allegations to be baseless. 

 EXHIBIT D 
 SUBSIDIARIES 

 EXHIBIT E 
  
 CYBEX INTERNATIONAL, INC. 
  
 REPORT OF CHIEF FINANCIAL OFFICER 
  
 CYBEX INTERNATIONAL, INC. (the “Borrower”) HEREBY CERTIFIES that: 
  
 This Report is furnished pursuant to Section 5.1(c) of the Credit Agreement dated as of July 13, 2004 by and between the
Borrower and GMAC Commercial Finance LLC (the “Agreement”). Unless otherwise defined herein, the terms used in this Report have the meanings given to them in the Agreement. 
  
 As required by Section 5] (a) and (b) of the Agreement, consolidated financial statements of the Borrower and its
Subsidiaries for the [year/quarter] ended                                  
20         (the “Financial Statements”) prepared in accordance with generally accepted accounting principles consistently applied accompany this Report. The Financial Statements present fairly
the consolidated financial position of the Borrower and its Subsidiaries as at the date thereof and the consolidated results of operations of the Borrower and its Subsidiaries for the period covered thereby (subject only to normal recurring year-end
adjustments). 
  
 The figures set forth in Schedule A for
determining compliance by the Borrower with the financial covenants contained in the Agreement are true and complete as of the date hereof 
  
 The activities of the Borrower and its Subsidiaries during the period covered by the Financial Statements have been reviewed by the Chief Financial
Officer or by employees or agents under his immediate supervision, Based on such review, to the best knowledge and belief of the Chief Financial Officer, and as of the date of this Report, no Default has occurred.* 
  
 WITNESS my hand this
             day of                     ,
20        . 
  

			
	 CYBEX INTERNATIONAL, INC.

		
	By:	 	 
	 Name:
	 	 Arthur W. Hicks, Jr.

	 Title:
	 	 Vice President; Chief Financial Officer

  

	*	If a Default has occurred, this paragraph is to be modified with an appropriate statement as to the nature thereof, the period of existence thereof and what action the Borrower has
taken, is taking, or proposes to take with respect thereto. 

 SCHEDULE A 
 to 
 EXHIBIT E 
  
 FINANCIAL COVENANTS 
  
 Fixed Charge Coverage Ratio (Section 5.9) 
  

					
			
	 REQUIRED
	  	 	  	>
                    :                  
          1.00
			
	 ACTUAL:
	  	 	  	 
		
	 (i)      EBITDA minus
	  	$                    
		
	 (ii)     Non-financed Capital Expenditures minus
	  	$                    
		
	 (iii)    Support Obligations
	  	$                    
		
	           Subtotal:
	  	$                    
		
	 (iv)    Fixed Charges
	  	$                    
		
	 (v)     Result of lines (i), (ii) and (iii), divided by line (iv)
	  	                :                     
               1.00
			
	 Leverage Ratio (Section 5.10)
	  	 	  	 
			
	 REQUIRED:
	  	 	  	< 5.0 : 1.00
			
	 ACTUAL:
	  	 	  	 
		
	 (i)      Funded Debt
	  	$                    
		
	 (ii)     EBITDA
	  	$                    
		
	 (iii)    Line (i) divided by line (ii)
	  	                :                     
            1.00

  
 WITNESS my hand this      day of                 , 20    . 
  

			
	 CYBEX INTERNATIONAL, INC.

		
	 By:
	 	 
	 Name:
	 	 Arthur W. Hicks, Jr.

	 Title:
	 	 Vice President; Chief Financial Officer

 EXHIBIT F 
  
 FORM OF OPINION OF COUNSEL TO THE BORROWER 

 LAW OFFICES 
  
 A. JUSTIN 
  
 MCCARTHY, BC. 
  

			
	Liberty Park	  	A. Justin McCarthy
	285 Littleton Road	  	Michele L. Granger
	Westford, MA 01886	  	 
	978-692-3211	  	 
	978-692-5476 Fax	  	 
	ajmccarthy@wcstfordlaw.com email	  	 

  
 July
    , 2004 
  
 GMAC Commercial Finance LLC 

210 Interstate North Parkway Suite 315 
 Atlanta, GA 30339 
  

	 	Re:	Cybex International, Inc. (the “Borrower”) 

  
 Gentlemen/Madam: 
  
 This opinion is furnished to you in connection with certain loan documents, namely: Credit Agreement, Mortgage and UCC-1 Financing Statement (hereinafter
referred to as “Loan Documents”), dated July 13, 2004; given by the Borrower, Cybex International, Inc., a Delaware Corporation, to GMAC Commercial Finance, LLC, a Delaware Limited Liability Company (“the Lender”), pursuant to
which the Lender is extending credit to the Borrower in the original principal amount of$ 13,000,000.00, evidenced by two (2) Promissory Notes — one in the principal amount of $11,000,000.00 and the second in the principal amount of
$2,000,000.00. Both Promissory Notes are being secured by the “Loan Documents” as hereinbefore stated. 
  
 I have acted as Massachusetts Counsel to the Lender in connection with certain transactions contemplated by the Loan Documents. In that regard, I have
reviewed a copy or original counterpart in the above referenced Loan Documents. 
  
 In rendering the opinion herein I have assumed the genuiness of the signatures of each party, the authenticity of all documents provided to my firm and the authenticity of the individuals executing the Loan Documents
by the Borrower, Cybex International Inc. In rendering the opinion expressed below, I have examined original or copies certified to my satisfaction of such other agreements, documents, certificates and other statements of government officials and
corporate officers of the Borrower and I have made such investigation of law, as I have deemed necessary as a basis for my opinion. 

 Page – 2- 
 Re:   Cybex International Inc. 
  

 Based upon the foregoing assumptions and subject to the qualifications hereinafter set forth, it is
my opinion that as of the date of this opinion: 
  
 1. When the
Mortgage is duly recorded and indexed with the Registry of Deeds in Norfolk County, Commonwealth of Massachusetts (the “Recording Office”) and the Financing Statement associated therewith is duly filed and indexed in the Recording Office
and the Office of the Massachusetts Secretary of State, such recordations and filings will be sufficient to give constructive notice to third parties of the mortgage of that portion of the Property including fixtures, that constitutes real property
(the “Real Property”) and the security interest in that portion of the Property (the “Personal Property”) that is subject to the provisions of Article 9 of the Massachusetts Uniform Commercial Code (the “UCC”) and which
may be perfected solely by recording or filing. No re-recording or re-filing of any said instruments nor any recording or filing of any other instruments will be necessary to continue the perfection and priority of such mortgage and security
interest for so long as the Loans are outstanding, except that continuation statements under the UCC are required to be filed within six (6) months prior to the expiration of five (5) years from the date of filing of the Financing Statements.

  
 2. The Mortgage is also in proper form under applicable laws
to be accepted for recording by the Recording Office as a fixture filing. Upon due recordation with the Recording Office the Mortgage will create in favor of the Lender a valid and enforceable mortgage of record of the entire interest of the
Borrower in the Real Property and a perfected interest in that portion of the Real Property that constitutes fixtures. The Mortgage creates a valid security interest in all of the Personal Property to the extent such security interest can be created
by a security agreement under the UCC. 
  
 3. The Financing
Statements complies with all applicable provisions of the UCC and is in proper form for filing with the Recording Office and the Massachusetts Secretary of State. Upon such filings (together with the filing of the Mortgage with the Recording
Offices, as aforesaid, with respect to fixtures), the Lender’s security interest in the property described therein will be perfected. 
  
 4. The terms and provisions of the Mortgage, with respect to the performance of the Borrower’s obligations and the powers and remedies of the Lender
there under, provide protection to the Lender in a manner that is customarily provided in mortgages of real properly and fixtures with respect to real property located in the Commonwealth of Massachusetts given to banks and financial institutions in
transactions involving substantial amounts of credit. 
  
 5.
There will be no transfer, documentary stamps mortgage, mortgage registry, mortgage recording or other taxes payable to any governmental authority in the Commonwealth of Massachusetts in connection with the execution, delivery, enforcement,
recordation, filing or perfection of either of the Mortgage or the Financing Statements, except only customary per page or per document filing and recording fees payable upon the 

 Page – 3- 
 Re:   Cybex International Inc. 
  

 
recordation or filing of either of the Mortgage or the Financing Statements arid court costs and fees that may be payable in connection with the enforcement
of the Mortgage. 
  
 6. The internal law of the Commonwealth of
Massachusetts will be applied by a court of competent jurisdiction (i) to determine the perfection or priority of the mortgage lies or security interest creased by the Mortgage and the Financing Statements on the Property, and (ii) in connection
with the foreclosure or exercise of the power of sale or assent to a decree by the Lender with respect to the Mortgage. 
  
 7. No order, consent, approval, license or authorization of any governmental authority, or filing, recording or registration by the Lender, in the
Commonwealth of Massachusetts is required solely in connections with the execution and delivery or acceptance by the Lender of the Loan Documents, or the consummation by the Lender of the transactions contemplated thereby. Lender will not be
required solely by reason of the transactions contemplated thereby to qualify to do business in the Commonwealth of Massachusetts, and the execution and delivery of such documents and the consummation of such transactions do not otherwise violate
any laws of the Commonwealth of Massachusetts. 
  
 8. The Loan,
as made, will not violate any applicable usury laws of the Commonwealth of Massachusetts, or other applicable laws regulating the interest rate, fees and other charges that may be collected with respect to the Loan. 
  
 9. Assuming that the Mortgage has been fully authorized, executed and
delivered by Cybex International Inc., the Mortgage constitutes the legal, valid, and binding contract of Cybex, is enforceable in accordance with its terms and provides adequate and customary remedies for the practical realization of the benefits
and security afforded therein. It is my opinion that the Mortgage is enforceable in accordance with its terms and subject to the following qualifications: 
  
 a. Enforcement of the Mortgage may be limited by one (1) bankruptcy, insolvency, reorganization, fraudulent coverage or similar State or Federal debtor
relief laws from time to time in effect and which may affect the enforcement of creditor’s rights in general, which laws will not mutually prevent realization of the benefit intended by the Mortgage and two (2) general principles of equity
(regardless of whether such enforceability is considered in a proceeding at law of in equity). In regard to certain covenants or provisions of the Mortgage where (a) the breach of such covenant or provisions imposes restrictions or burdens upon the
Borrower including the acceleration of liability under such document, and it cannot be demonstrated that the enforcement of such restriction or burden is reasonably 

 Page – 4- 
 Re:   Cybex International Inc. 
  

 
necessary for the protection of the Lender, or (b) the Lender’s enforcement of such covenant or provisions under the circumstances or in the manner
selected by the Lender would violate implied covenants of good faith and fair dealing or would not be commercially reasonable. 
  
 b. Certain rights, remedies an waivers contained in the Mortgage maybe limited or rendered ineffective by applicable Massachusetts statutes or judicial
decisions governing such provisions however such statutes and/or judicial decision do not render the Mortgage invalid as a whole and there exists in the Mortgage legally adequate remedies for a realization of the principal benefit and security
intended to be provided by said Mortgage, including effecting a foreclosure in accordance with applicable law of the lien on and the mortgage or security interest in the Property created by the mortgage upon maturity or acceleration of the
obligation of the Borrower to repay the principal, together with interest thereon(to the extent not deemed a penalty) as provided in the Financing Agreement. 
  
 I am qualified and licensed to practice law in the Commonwealth of Massachusetts and my opinion as to the enforceability of said Mortgage is limited to
the current statutes in effect and the present case law, rules, regulations and other laws, for the Commonwealth of Massachusetts. This opinion letter is furnished only to the Lender and is solely for its benefit, the benefit of Lender’s
successors and assigns (including participants in the Loan) and the benefit of Lender’s counsel in connection with this transaction contemplated by the Loan Documents. This opinion is not to be used, circulated, and quoted or otherwise relied
upon by any other person or entity or for any other purpose without the prior written consent of the author. 
  

	
	 Sincerely yours,

	
	 
	 A. Justin McCarthy

  
 AJM/cc 

 LEONARD, STREET AND DEINARD 
  
 PROFESSIONAL ASSOCIATION 
  
 July 13, 2004 
  
 GMAC Commercial Finance LLC 
 210 Interstate North Parkway, Suite 315 
 Atlanta, GA 30339 
  

	 	Re:	Mortgage loan (the “Loan”) to Cybex International, Inc. (the “Borrower”) made by GMAC Commercial Finance LLC (the “Lender”) in the
amount of $13,000,000 

  
 Ladies and Gentlemen: 
  
 We have acted as special Minnesota counsel to the Borrower in connection with the above
referenced Loan and in connection with the transactions contemplated thereby. In such capacity and in connection with the opinions set forth herein, we have examined originals, or copies certified or otherwise identified to our satisfaction, of the
documents listed on Exhibit A attached hereto (the “Loan Documents”), which evidence and secure the Loan. In rendering our opinion, we have also examined certificates of public officials, and such other records, certificates,
documents and instruments, and we have made such investigations of law, as we have deemed necessary or appropriate for the purposes of rendering this opinion letter (this “Opinion”). 
  
 All capitalized terms not defined herein or in Exhibit A shall have the meanings
assigned to them in the Mortgage described in said Exhibit A, The term “State” means the State of Minnesota. The term “UCC” means the Uniform Commercial Code as adopted in the State as of the date of this
Opinion. 
  
 ASSUMPTIONS 
  
 For purposes of this Opinion, we have, with your permission, assumed without independent
investigation that: 
  
 a. All signatures on all documents
submitted to us are genuine; all natural persons who are materially involved in the Loan or are signatories to the Loan Documents have sufficient legal capacity to enter into the Loan and carry out their role in it; documents submitted to us as
originals are authentic; all documents submitted to us as certified or photostatic copies conform to the original documents, which themselves are authentic; and the facts stated in all such documents (including any recitals contained in the
Loan Documents) are true and correct. In rendering this Opinion, we have not made any independent investigation as to the accuracy or 

 GMAC Commercial Finance LLC 
 July 13, 2004 
 Page 2 
  

 
completeness of any facts or representations, warranties, data or other information, whether written or oral, that may have been made by or on behalf of the
parties, except as specifically set forth herein. 
  
 b. Each of
the Loan Documents completely and correctly sets forth the intent of the parties thereto. There has been no mutual mistake of fact, fraud, undue duress or influence, that would limit, expand or otherwise modify the respective rights and obligations
of the parties as set forth iii the Loan Documents, or that would have an effect on the opinions expressed herein; and there has been no waiver of any of the provisions of the Loan Documents, by actions or conduct of the parties or otherwise.

  
 c. Each party to any Loan Document has, as of the date hereof:
(i) full power, authority and legal right under all applicable laws and its organizational documents to enter into the Loan and each of the Loan Documents to which it is a party; (ii) duly and validly authorized, executed and delivered the Loan
Documents (which require such authorization, execution or delivery) to which it is a party. 
  
 d. The Borrower holds all of the appropriate right, title or interest in or to the real and personal property purported to be encumbered by the Loan Documents and is the owner of the landlord’s leasehold interest
subject to the assignment of rents and leases provisions contained in the Mortgage. 
  
 e. The execution, delivery and performance of the Loan Documents by each party thereto will not result in any breach of or under any instrument, agreement, contract or other document to which any such party is a party
or by which its properties are bound, and all consents necessary under any and all such instruments, agreements or consents have been obtained. 
  
 f. Such of the Loan Documents as require (i) recordation have been or shall have been duly recorded in the appropriate offices or (ii) filing have been or
shall have been filed in the appropriate filing locations. 
  
 g.
Any Property consisting of either (i) goods which are (or are to become) fixtures or (ii) as-extracted collateral (as defined in the UCC) or timber is (or will be) located on the Land. 
  
 h. To the extent that any licenses, franchises, leases, plans, specifications, operating agreements, service contracts,
contract rights, accounts or general intangibles, require by their terms the consent or approval of another party for their assignment or encumbrance, such consents have been obtained. 
  
 i. The Mortgage gives the correct name and address of the Lender or of a representative of the Lender from whom information
about the related security interest may be obtained. 

 GMAC Commercial Finance LLC 
 July 13, 2004 
 Page 3 
  

 j. The Mortgage contains a legal description of the Land that (1) accurately describes the Land and
(ii) describes all real property in the State that is intended to be collateral for the Loan. 
  
 k. There is full and adequate consideration given in exchange for the Borrower’s execution, delivery and performance of the Loan Documents. 
  
 OPINIONS 
  
 Based upon the foregoing Assumptions and subject to the Qualifications, Limitations and Comments stated herein, we are of the opinion that: 
  

	1.	The Mortgage is a legal, valid and binding instrument, enforceable against the Borrower in accordance with its terms, except as may be limited by (a) the Assumptions set forth in
this Opinion and (b) the Qualifications, Limitations and Comments set forth in this Opinion. 

  
 The foregoing opinion as to enforceability of the Mortgage is also subject to the qualification that certain provisions contained in the Loan Documents
may not be enforceable; provided, however (subject to the limitations set forth in clauses (a) and (b) in the paragraph immediately above), such unenforceability will not render the Mortgage invalid as a whole or substantially interfere with
realization of the Principal Benefits and Security which are provided thereby. As used herein, the term “Principal Benefits and Security” means the customary (but not exclusive) remedies set forth in the Mortgage of: (w) judicial
enforcement of the obligation of the Borrower to repay the principal, together with interest thereon as provided in the Notes or in the Credit Agreement; (x) acceleration of the obligation to repay such principal and interest upon a material default
under the Loan Documents (assuming that such acceleration is a permitted remedy under the laws of the State of New York) ; (y) judicial foreclosure of the Mortgage (or, if applicable, non-judicial foreclosure under certain circumstances in
accordance with applicable law of the State), upon failure to pay such principal and interest at maturity or upon acceleration pursuant to clause (x) immediately above; and (z) the judicial enforcement of the assignment of rents and leases
provisions in the Mortgage upon acceleration pursuant to clause (x) immediately above for purposes of collecting rents accruing after the appointment of a receiver in an action to foreclose the Mortgage. The Mortgage does not omit material rights
and remedies which a prudent lender would insist upon based on the particular laws of the State. 
  

	2.	Based solely on the Certificate of Good Standing for a non-Minnesota corporation issued by the Office of the Minnesota Secretary of State, a copy of which is attached hereto as
Exhibit B, the Borrower is qualified to do business in the State. 

 GMAC Commercial Finance LLC 
 July 13, 2004 
 Page 4 
  

	3.	The Mortgage is in proper form to be accepted for recording in either the office of the County Recorder or (to the extent that the Land is registered property under Chapter 508 of
the Minnesota Statutes) the office of the Registrar of Titles of the county in which the Land is located (each being a “Recording Office”). The Mortgage is also in proper form under applicable laws of the State to be accepted for
recording by the Recording Office as a fixture filing. Upon recording of the Mortgage in the appropriate Recording Office and payment of mortgage registry tax in the proper amount: (a) the Mortgage will create a valid and enforceable mortgage of
record on the real property secured by the Mortgage, (b) the-Mortgage will impart constructive notice to third parties of its contents, and (c) the Mortgage will constitute a UCC filing with respect to Fixtures (as that term is defined in the UCC)
and thereby create a perfected security interest in any Fixtures described in the Mortgage. No re-recording or re-filing of the Mortgage, nor any recording or filing of any other instruments, will be necessary to continue the perfection and priority
of such Mortgage and security interest for so long as the Loan is outstanding, except that continuation statements under the UCC are required to be filed within six (6) months prior to the expiration of five (5) years from the date of filing of the
Financing Statement. 

  

	4.	The provisions of the Mortgage granting the Lender a present, absolute assignment of the Rents and Leases are in proper form sufficient to create a valid lien on such Rents and
Leases in favor of the Lender. The recordation or filing of the Mortgage is the only recordation, filing and registration necessary to perfect the lien on the Rents and Leases created by the Mortgage. 

  

	5.	Except for mortgage registry tax due pursuant to Chapter 287 of the Minnesota Statutes referred to in paragraph E(i) below, there are no other state or local taxes, recording
charges, fees or other charges payable in connection with the execution, delivery, recordation, filing or enforcement of the Loan Documents other than nominal recording fees in the appropriate state or county offices. 

  

	6.	Protective advances made pursuant to the terms of the Mortgage and in accordance with Chapter 287 of the Minnesota Statutes are secured by the Mortgage. 

  

	7.	The provisions of the Mortgage create, in favor of the Lender, a security interest in all right, title and interest of the Borrower in the Property in which a security interest may
be created under Article 9 of the UCC. 

  

	8.	Under the UCC, while a debtor is located in a jurisdiction, the local law of that jurisdiction governs perfection, the effect of perfection or nonperfection, and the priority of a
security interest in collateral to the extent that such security interest may be perfected by filing a financing statement under the UCC. An entity organized under state law is deemed to be located in the state of organization pursuant to the UCC.

 GMAC Commercial Finance LLC 
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	9.	If the laws of the State were held to govern the Notes and/or the Credit Agreement, the interest and other payments to be received by the Lender pursuant to the Notes and the other
Loan Documents would not violate the applicable State laws governing usury. 

  

	10.	The internal law of the State will be applied by a State court of competent jurisdiction (a) to determine the perfection or priority of the mortgage liens or security interests
created by the Mortgage, and (b) in connection with the foreclosure of the Mortgage by advertisement or by action. 

  

	11.	No order, consent, approval, license or authorization of any governmental authority, or filing, recording or registration by the Lender, in the State is required solely in
connection with the execution and delivery or acceptance by the Lender of the Mortgage and the Financing Statement. The following activities within the State, among others, do not constitute transacting business within the State and do not require
the Lender to qualify to do business in the State as a foreign corporation or otherwise (assuming no other activities are conducted in the State by the Lender): 

  

	 	(a)	making loans or creating or acquiring evidences of debt, mortgages, or liens on real or personal property or recording same; 

  

	 	(b)	securing or collecting debts or enforcing any rights from property securing the same; or 

  

	 	(c)	owning, without more, real or personal property. 

  
 Except as expressly set forth in Opinion 14 below, we give no opinion as to whether the Lender may be subject to taxation under the laws of the State.

  

	12.	The provisions in the Notes and the Credit Agreement in which the parties agree that such Loan Documents are to be governed by the laws of the State of New York are valid under the
law of the State and will be enforced by the courts of the State, subject to any determination by such courts that the application of a law of a jurisdiction other than the State is against public policy. We express no opinion as to whether a
federal or state court outside the State would give effect to the choice of law provided for in such Loan Documents. 

  
 The opinion set forth in the foregoing paragraph is also subject to the assumptions that (a) the state that the parties chose to govern in the applicable
Loan Document has a substantial relationship to the parties or to the transaction described in the Loan Documents or there is some other reasonable basis for the choice, (b) application of the laws of the State of New York is not contrary to a
fundamental policy of another state 

 GMAC Commercial Finance LLC 
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having a materially greater interest in the issue than the State if such other state would be the state of applicable law in the absence of a choice by the
parties to the contrary and (c) the parties to the Loan Documents are acting in good faith and mutually agree to the choice of law provision. 
  

	13.	The Obligations (as defined in the Credit Agreement) are secured by the Mortgage and the Principal Benefits and Security which are provided thereby. 

  

	14.	The Lender will not incur any tax liability in the State solely as a result of its making of the Loan, the execution and delivery by the Borrower of the Credit Agreement, the
Mortgage or the Financing Statements or acceptance thereof by the Lender, or the receipt of payments thereunder in accordance with the terms thereof. 

  
 QUALIFICATIONS, LIMITATIONS AND COMMENTS 
  
 The foregoing opinions are subject to the qualifications, limitations and comments set forth below. 
  
 A. Enforceability of the Loan Documents may be limited by applicable laws
relating to bankruptcy, reorganization, insolvency, moratorium, fraudulent conveyance or transfer or other similar laws now or hereafter in effect relating to or affecting creditors’ rights generally, including, but not limited to, judicially
developed doctrines relevant to any of the foregoing laws. 
  
 B.
Enforcement of a party’s rights and remedies under the Loan Documents may be limited by general principles of equity, regardless of whether such enforcement is considered in a proceeding inequity or at law. This limitation includes principles:

  

	 	(i)	governing the availability of equitable remedies; 

  

	 	(ii)	affording equitable defenses (e.g., waiver, laches and estoppel); 

  

	 	(iii)	requiring good faith, fair dealing and reasonableness in the performance and enforcement of a contract; 

  

	 	(iv)	requiring consideration of the materiality of(a) the breach and (b) the consequences of the breach to the party seeking enforcement; and 

  

	 	(v)	requiring consideration of the impracticability or impossibility of performance at the time of attempted enforcement. 

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 C. We express no opinion as to (i) the enforceability of certain provisions of the Loan Documents
purporting to give the Lender (or any receiver) the right to possession of or control over the property or rents encumbered by the Mortgage at times or in a manner not consistent with the provisions of Minn. Stat. §§ 559.17 or 576.01, or
Chapters 580, 581 and 582 of the Minnesota Statutes, or (ii) certain provisions of the Loan Documents regarding foreclosure sales, deficiency judgments or the enforcement of rights and remedies following foreclosure sale, to the extent such
provisions are inconsistent with the provisions of Chapters 580, 581 and 582 of the Minnesota Statutes. 
  
 With respect to the foregoing, enforcement of the Lender’s rights and remedies under the Mortgage is subject to the following: 
  

	 	(i)	The State’s law places significant restrictions upon the right of a mortgagee to gain possession of mortgaged property in the event of default. However, subject to the
provisions of this Opinion (including this Paragraph C), the provisions in the Mortgage for appointment of a receiver of rents are valid and enforceable. 

  

	 	(ii)	Non-judicial foreclosure (foreclosure by advertisement) in the State is not available while another action or proceeding to recover the debt is pending. A judicial foreclosure
(foreclosure by action), however, would not be subject to such a delay. 

  

	 	(iii)	In the case of foreclosure by advertisement, the amount received from foreclosure sale is full satisfaction of the mortgage debt. 

  

	 	(iv)	My provision of the Mortgage to the contrary notwithstanding, Chapters 580 and 581 of the Minnesota Statutes grant to mortgagors the right to cure defaults under and reinstate
mortgage loans within the time and upon payment of the amounts provided by statute. In addition, mortgagors and junior secured creditors may redeem mortgaged property sold at a foreclosure sale within a specified period after such sale, by paying
the amounts provided in Chapters 580 and 581 of the Minnesota Statute. 

  

	 	(v)	Under the State’s foreclosure statutes, separate parcels must be sold separately. 

  

	 	(vi)	Legal fees chargeable in case of foreclosure are limited by Chapter 582 of the Minnesota Statutes. 

  
 D. A party’s rights to commence the exercise of rights and remedies with respect to the Loan Documents may depend upon
such party’s compliance with the filing and reporting requirements set forth in Minn. Stat. § 290.371. In general, Minn. Stat. § 290.371 requires a 

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corporation (including, without limitation, a financial institution) to file a Minnesota Business Activity Report (Form M-4R) with the Minnesota Department
of Revenue if it obtains any business from within the State as described in Minn. Stat. § 290.015, subd. 1, during a fiscal year. 
  
 If the Minnesota Business Activity Report is required and not filed, the party failing to so file would not have any cause of action upon which it may bring suit under
the State’s law, except for issues related to its State tax liability. Furthermore, such a party would be prevented from using the courts in the State, in general. However, a court would be obligated to excuse a failure to file and restore a
cause of action if such party “paid all taxes, interest, and civil penalties due the state for all periods, or provided for payment of them by adequate security or bond.” We express no opinion as to whether any party is obligated to file a
Minnesota Business Activity Report, nor as to whether any of them is subject to State taxes, including the corporate franchise tax (i.e., state income tax), as a result of the present Loan. 
  
 E. Minnesota Statutes Section 290.015 provides that a person or entity is
subject to the corporate franchise tax if; among other things, it (a) conducts a trade or business that has a place of business in Minnesota, (b) regularly has employees or independent contractors conducting business activities on its behalf in
Minnesota, (c) operates or leases Minnesota real property or (d) “obtains or regularly solicits business” from within Minnesota. Under Minn §290.015, Subd. 2, a person or entity is rebuttably presumed to be obtaining or regularly
soliciting business from Minnesota if(x) it obtains or solicits business from more than twenty or more persons in Minnesota in a tax year or (y) it is a financial institution (as defined in Minn. Stat. §290.04, subd. 4 - typically, banks, bank
holding companies, savings and loan associations, and other similar regulated institutions) with assets and deposits attributable to sources located in Minnesota (including loans secured by real property or tangible personal property located in
Minnesota) in excess of five million dollars. 
  
 F. We express no
opinion as to: 
  

	 	(i)	the enforceability of the Mortgage if the proper amount of mortgage registry tax due pursuant to Chapter 287 of the Minnesota Statutes has not been paid or as to what the proper
amount of mortgage registry tax should be. We note that such a tax is imposed based on “the debt or portion of a debt that is secured by any - recorded mortgage of real property located in this state. The person liable for the tax is the
mortgagor.” Minn. Stat. § 287.035; 

  

	 	(ii)	the enforceability of any provisions of the Loan Documents by which the parties submit to the jurisdiction of particular courts or waive objections to venue or waive a jury trial;

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	 	(iii)	the enforceability of any waivers contained in the Loan Documents, including, without limitation, any waivers of the right to trial by jury, any waivers of redemption rights, or any
limitations on liability contained in the Loan Documents; 

  

	 	(iv)	the enforceability of any provision of the Loan Documents providing for late payment fees, default interest, liquidated damages or any other fees, charges or amounts which may be
construed as a penalty under the laws of the State; 

  

	 	(v)	the enforceability of any of the Loan Documents against any parties other than the Borrower; 

  

	 	(vi)	the enforceability of provisions of the Mortgage purporting to give the Lender self-help remedies to the extent such self-help remedies are inconsistent with the provisions of
Chapters 336.9, 559, 580, 581 and 582 of the Minnesota Statutes; 

  

	 	(vii)	any power of attorney or the enforceability of any provisions of the Loan Documents pursuant to which any party purports to act as attorney-in-fact for any other party;

  

	 	(viii)	the provisions of other documents incorporated into the Loan Documents by reference, although we note that it is customary practice to incorporate by reference provisions of
unrecorded documents, for limited purposes; provided the foregoing shall not be deemed to limit Opinion 1 set forth above; 

  

	 	(ix)	the effect of action taken in the State on the ability to exercise remedies in another state; 

  

	 	(x)	the provisions or enforceability of that certain Intercreditor Agreement dated as of the same date as the Mortgage by and among Lender, Borrower, and The CIT Group/Business Credit,
Inc.; or 

  

	 	(xi)	except with respect to the limited opinions expressly set forth herein, the enforceability of the Notes or the Credit Agreement. 

  
 G. We have made no investigation as to any party’s rights in (except as
to the Lender’s interest created by the Loan Documents as expressly set forth in the opinions above) or title to the Property and we express no opinion as to such rights in or title to such collateral. 
  
 H. We understand that, with respect to the priority of the lien created by
the Mortgage, you will rely on a title insurance policy, and, accordingly, we express no opinion on such matter. 

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 I. Except as specifically set forth herein, we express no opinion as to the perfection or priority of
any security interest in personal property or fixtures granted pursuant to any of the Loan Documents. 
  
 J. We have not reviewed and do not opine as to whether the Property complies with applicable zoning, health, safety, building, environmental, land use or
subdivision laws, ordinances, codes, rules or regulations. 
  
 K.
With respect to any opinions expressed regarding security interests in personal property, the opinions expressed herein are limited to collateral in which the creation, perfection and effect of a security interest are governed by the UCC.

  
 L. We call to your attention that the security interest
created by the Borrower in proceeds of the collateral and the perfection of such security interest is limited to the extent set forth in Minn. Stat. § 336.9-315. We do not express any opinion with respect to the perfection of a security
interest in any Property that constitutes cash or cash equivalents, except to the extent that they constitute proceeds under Minn. Stat. § 336.9-3 15, during any period of time when they are not held by the Lender or its agent. 
  
 M. For purposes of this Opinion, we are acting solely as members of the bar
of the State and render this Opinion only with respect to the law of the State. The opinions expressed herein are based only upon applicable Minnesota laws, statutes, rules, regulations and court decisions in existence on the date hereof. We express
no opinion as to the enforceability of any of the provisions of the Loan Documents on property not located in the State. Except as expressly set forth herein, we express no opinion as to the effect of (i) the choice-of-law provisions of the Loan
Documents or (ii) the choice-of-law rules of the State or any other jurisdiction. 
  
 N. The opinions expressed herein apply only to those facts arid circumstances that exist as of the date hereof; and we assume no obligation or responsibility to update or supplement this Opinion to reflect any facts
or circumstances occurring after the date hereof that would alter the opinions contained herein. 
  
 This Opinion is limited to the matters set forth herein. No opinion may be inferred or implied beyond the matters expressly contained herein. This Opinion may be relied upon only by the addressee hereof, and by
transferees of the Credit Agreement, including any participants in the Loan and each such parties respective attorneys. In addition, this Opinion may be relied upon by any person or entity acting as agent or trustee, or any rating agency in
connection with a securitization of the Loan. This Opinion may be relied upon only as expressly provided above and may not be used, quoted from, referred to or relied upon by you or by any other person for any other purpose, nor may copies be
delivered to any other person, without in each instance our express prior written consent; provided, however, you may deliver copies of this Opinion to: (i) 

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 July 13, 2004 
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the accountants, attorneys and other professional advisors acting on behalf of any person entitled to rely on this Opinion in connection with the Loan or the
transactions contemplated thereby, (ii) governmental regulatory agencies having jurisdiction over you to the extent disclosure of this Opinion is required by applicable law or regulation, (iii) designated persons pursuant to order or legal process
of any court or governmental agency or authority of competent jurisdiction or as may be required by law, (iv) to any ratings agency involved in the securitization of the Loan, and (v) anyone expressly entitled to rely on this Opinion. 
  

			
	Very truly yours,
	
	 LEONARD, STREET AND DEITNARD
 PROFESSIONAL
ASSOCIATION

		
	By	 	 

 EXHIBIT A 
  
 LOAN DOCUMENTS 
  
 1. Credit Agreement (the “Credit Agreement”) dated July 13, 2004 by and between the Borrower and the Lender setting forth certain terms and conditions of
the Loan. 
  
 2. A Promissory Note in the original principal amount of $11,000,000
and a Promissory Note in the original principal amount of $2,000,000 (each, a “Note” and together, the “Notes”), each dated July 13, 2004 and made by the Borrower in favor of the Lender, which together evidence the
Loan 
  
 3. Mortgage, Assignment of Leases and Rents, Security Agreement and
Fixture Filing (the “Mortgage”) dated July 13, 2004 made by the Borrower in favor of the Lender as security for the Notes and describing certain real estate located in Owatonna, Minnesota (the “Land”), improvements
and fixtures located thereon and other personal property related thereto (together with the Land, collectively referred to as the “Property”). 
  

4. UCC-I Financing Statement (the “Financing Statement”) naming the Borrower as Debtor and the Lender as Secured Party. 
  
 Documents 1 through 4 above are collectively referred to as the “Loan
Documents.” 
  

 EXHIBIT B 
  
 Good Standing Certificate 
  

 EXHIBIT G 
  
 Permitted ExceptionsSECOND AMENDMENT TO FINANCING AGREEMENT

 Exhibit 10.2 
  
 SECOND AMENDMENT TO FINANCING AGREEMENT 
  
 THIS SECOND AMENDMENT TO FINANCING AGREEMENT, dated as of July 13, 2004 (this “Amendment”), is made between
CYBEX INTERNATIONAL, INC., a New York corporation (the “Borrower”), and THE CIT GROUP/BUSINESS CREDIT, INC., a New York corporation (“CIT”). 
  
 RECITALS: 
  
 A. The Borrower and CIT are parties to that certain Financing Agreement, dated as of July 16, 2003 (as amended, modified, restated or supplemented from
time to time, the “Financing Agreement”), pursuant to which, among other things, CIT extended to the Borrower a loan facility. 
  
 B. The Borrower has requested that the Financing Agreement be amended. 
  
 C. CIT has agreed to such request, upon the terms and subject to the conditions and limitations set forth herein, and, to
accomplish the foregoing, the Borrower and CIT have agreed to execute this Amendment. 
  
 D. All capitalized terms used herein without definition shall have the meanings ascribed to such terms in the Financing Agreement as amended hereby, unless otherwise defined herein. 
  
 AGREEMENTS: 
  
 Accordingly, in consideration of the premises and the mutual covenants
contained herein, and for other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows: 
  
 ARTICLE I 
  
 AMENDMENTS 
  
 CIT and the Borrower hereby agree that (i) the Financing Agreement is amended in its entirety to read in the form of the financing agreement attached
hereto as Exhibit A to this Amendment, (ii) Schedule 2 to the Financing Agreement is amended in its entirety to read in the form of such Schedule 2 attached hereto as Exhibit B to this Amendment, and (iii) Schedule
5 to the Financing Agreement is amended in its entirety to read in the form of such Schedule 5 attached hereto as Exhibit C to this Amendment. 

 ARTICLE II 
  
 REPRESENTATIONS AND WARRANTIES 
  
 The Borrower hereby represents and warrants to CIT as follows: 
  

2.1 Compliance with Financing Agreement and Other Loan Documents. After giving effect to this Amendment, the Borrower is in compliance with all
of the terms and provisions set forth in the Financing Agreement and in the other Loan Documents to be observed or performed by the Borrower. 
  
 2.2 Representations in Financing Agreement and Other Loan Documents. The representations and warranties of the Borrower set forth in the Financing
Agreement and the other Loan Documents are true and correct in all material respects. 
  
 2.3 No Event of Default. No Default or Event of Default exists under the Financing Agreement and the other Loan Documents. 
  
 2.4 Authority. The execution and delivery by the Borrower of this Amendment and the performance by the Borrower of
its agreements and obligations under this Amendment and the Financing Agreement (i) are within the corporate authority of the Borrower, (ii) have been duly authorized by all necessary corporate action of the Borrower, (iii) do not conflict with or
result in any breach or contravention of any provision of law, statute, rule or regulation to which the Borrower is subject or any judgment, order, writ, injunction, license or permit applicable to the Borrower and (iv) do not conflict with the
terms of any provision of the corporate charter or by-laws of the Borrower, or any material agreement or other material instrument binding upon the Borrower. 
  
 2.5 Binding Obligation. This Amendment and the other Loan Documents constitute the legal, valid and binding obligations of the Borrower,
enforceable against the Borrower in accordance with their respective terms, except as enforceability may be limited by applicable bankruptcy, insolvency, or similar laws affecting the enforcement of creditors’ rights generally or by equitable
principles relating to enforceability. 
  
 2.6 Corporate
Documents. The articles of incorporation or other charter document and the bylaws of each of the Borrower and the Guarantors have not been amended or modified since the Closing Date. 
  
 ARTICLE III 
  
 CONDITIONS PRECEDENT 
  
 This Amendment shall become effective and be deemed effective as of the date hereof (the “Second Amendment Effective Date”) upon the
satisfaction by the Borrower or waiver by CIT of the following conditions precedent: 
  
 (a) Receipt by CIT of this Amendment, duly executed by the Borrower, and consented to by each of the Guarantors; 
  

 2 

 (b) CIT shall have received a copy of the resolutions of the Board of Directors or Executive Committee of
each of the Borrower and the Guarantors (as the case may be) authorizing the execution, delivery and performance of this Amendment certified by the Secretary, Assistant Secretary or other senior authorized officer of the Borrower and the Guarantors
(as the case may be) as of the date hereof; 
  
 (c) CIT shall have
received an executed Officer’s Certificate of the Borrower, satisfactory in form and substance to CIT, certifying that (i) the representations and warranties contained herein and in the Financing Agreement are true and correct in all material
respects on and as of the Second Amendment Effective Date; (ii) the Borrower is in compliance with all of the terms and provisions set forth herein and in the Financing Agreement; and (iii) no Default or Event of Default has occurred; 
  
 (d) Counsel for the Borrower and the Guarantors shall have delivered to CIT
opinions satisfactory to CIT opining, inter alia, that, this Amendment is (A) valid, binding and enforceable according to its terms, (B) is duly authorized, executed and delivered, and (C) does not violate any terms, provisions, representations or
covenants in the charter or by-laws of the Borrower or the Guarantors or, to the best knowledge of such counsel, of any loan agreement, mortgage, deed of trust, note, security or pledge agreement or indenture to which the Borrower or the Guarantors
are signatories or by which the Borrower or the Guarantors or their assets are bound; 
  
 (e) No Default or Event of Default shall have occurred and no material adverse change shall have occurred in the financial condition, business, prospects, profits, operations or assets of the Borrower or the
Guarantors or their respective subsidiaries; 
  
 (f) As of the
Second Amendment Effective Date, there shall be no (x) litigation, investigation or proceeding (judicial or administrative) pending or threatened against the Borrower or the Guarantors or their assets, by any agency, division or department of any
county, city, state or federal government arising out of this Amendment or the Financing Agreement, (y) injunction, writ or restraining order restraining or prohibiting the financing arrangements contemplated under this Amendment or the Financing
Agreement or (z) suit, action, investigation or proceeding (judicial or administrative) pending against the Borrower or the Guarantors or their assets, which, in the opinion of CIT, if adversely determined, could have a material adverse effect on
the business, operation, assets, financial condition or Collateral of the Borrower and/or the Guarantors; 
  
 (g) As of the Second Amendment Effective Date, after giving effect to this Amendment, Availability shall be at least $2,000,000; 
  
 (h) The Borrower shall have received the proceeds of the GMAC Loan and all
documentation with respect thereto shall be satisfactory to CIT; 
  

 3 

 (i) The Borrower shall have repaid the Term Loans (as defined in the Financing Agreement prior to giving
effect to this Amendment) in full; 
  
 (j) CIT shall be satisfied
with the financial condition of the Borrower and the Guarantors and an updated examination of the books and records of the Borrower and the Guarantors; 
  
 (k) There shall have been no material adverse change in the financial condition, business, prospects, profitability, assets or operations of the Borrower
or the Guarantors. It is understood and agreed that any adverse change in the terms, conditions, assumptions or projections supplied by the Borrower and on which CIT based its decision to issue this letter may, in CIT’s reasonable business
discretion, be construed by CIT as a material adverse change; 
  
 (l) Receipt by CIT of all fees and expenses of CIT in connection with the preparation, execution and delivery of this Amendment, including, without limitation, the fees and expenses set forth in that certain Commitment Letter (the
“Commitment Letter”) dated June 23, 2004 from CIT to the Borrower, including, without limitation, the Transaction Fee (as defined in the Commitment Letter) equal to $10,000; 
  
 (m) GMAC and CIT shall have entered into the GMAC Intercreditor Agreement in
form and substance satisfactory to CIT; 
  
 (n) CIT shall have
received an executed Term Loan Promissory Note; 
  
 (o) CIT shall
have received evidence satisfactory to CIT that HILCO (as defined in the Financing Agreement prior to giving effect to this Amendment) has released all of its Liens on the Collateral; 
  
 (p) Receipt by Moore & Van Allen, PLLC, of its fees and expenses in
connection with the preparation of this Amendment, which shall be charged to the Revolving Loan Account as of the date hereof; and 
  
 (q) Receipt by CIT of such other documents, instruments, and agreements as CIT and its counsel may reasonably request. 
  
 ARTICLE IV 
  
 MISCELLANEOUS 
  
 4.1 Full Force and Effect. As expressly amended hereby, the Financing Agreement shall continue in full force and effect in accordance with the
provisions thereof. As used in the Financing Agreement, “hereinafter”, “hereto”, “hereof” or words of similar import, shall, unless the context otherwise requires, mean the Financing Agreement as amended by this
Amendment. 
  
 4.2 Applicable Law. This Amendment shall be
governed by and construed in accordance with the internal laws and judicial decisions of the State of New York. 
  

 4 

 4.3 Counterparts. This Amendment may be executed in one or more counterparts, each of which shall
constitute an original, but all of which when taken together shall constitute but one and the same instrument. 
  
 4.4 Headings. The headings in this Amendment are for the purpose of reference only and shall not affect the construction of this Amendment.

  
 4.5 Waiver of Jury Trial. TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, THE BORROWER AND CIT EACH WAIVES THE RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT, PROCEEDING OR COUNTERCLAIM OF ANY KIND ARISING OUT OF OR RELATED TO THIS AMENDMENT, THE FINANCING AGREEMENT OR THE OTHER LOAN DOCUMENTS.

  
 4.6 Releases. On the Second Amendment Effective Date,
CIT will take all necessary steps to (a) return to Borrower the letter of credit issued for CIT’s benefit by Wachovia Bank, National Association in connection with the original closing of the Financing Agreement and (b) release and discharge
its lien and security interest in Borrower’s equipment, real estate and fixtures. 
  
 4.7 Consent. CIT hereby consents to the prepayment in full of the HILCO Loan (as defined in the Financing Agreement prior to giving effect to this Amendment) on the Second Amendment Effective Date. 

 

 5 

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

			
	 CYBEX INTERNATIONAL, INC.

		
	 By:
	 	 /s/ Arthur W. Hicks, Jr.

	 Name:
	 	 Arthur W. Hicks, Jr.

	 Title:
	 	 Vice President, Chief Financial Officer

	
	 THE CIT GROUP/BUSINESS CREDIT, INC.

		
	 By:
	 	 /s/ Robert H. Newman

	 Name:
	 	 Robert H. Newman

	 Title:
	 	 Vice President

  

 6 

 CONSENT OF GUARANTORS 
  
 Each of the undersigned (individually, a “Guarantor” and, collectively, the “Guarantors”),
a Guarantor of all of the indebtedness, obligations or liabilities of Cybex International, Inc., a New York corporation, to The CIT Group/Business Credit, Inc., a New York corporation (“CIT”), pursuant to that certain Guaranty,
dated July 16, 2003, executed by each of the Guarantors in favor of CIT, does hereby acknowledge receipt of a copy of the within and foregoing Second Amendment to Financing Agreement, dated as of the same date hereof, and, in connection therewith,
hereby consents to the execution, delivery and performance thereof and agrees that nothing contained therein nor in any document, instrument or other agreement required or contemplated thereby, shall alter, discharge, release, cancel or impair the
duties and obligations of such Guarantor under the Guaranty and that the Guaranty shall continue to remain in full force and effect, enforceable against such Guarantor in accordance with its terms, without any right of offset, deduction, defense or
counterclaim in favor of such Guarantor against CIT. 
  
 IN
WITNESS WHEREOF, each of the Guarantors has executed this Consent under seal as of the day and year first above written. 
  

			
	 CYBEX CAPITAL CORPORATION

		
	 By:
	 	 /s/ Arthur W. Hicks, Jr.

	 Name:
	 	 Arthur W. Hicks, Jr.

	 Title:
	 	 Vice President, Chief Financial Officer

	
	 TECTRIX FITNESS EQUIPMENT, INC.

		
	 By:
	 	 /s/ Arthur W. Hicks, Jr.

	 Name:
	 	 Arthur W. Hicks, Jr.

	 Title:
	 	 Vice President, Chief Financial Officer

  
 Signed as a deed by CYBEX
INTERNATIONAL UK LIMITED acting by: 
  

	
	 /s/ Arthur W. Hicks, Jr.

	 Director

	
	 /s/ James H. Carll

	 Director

  
 1366442 
  

 7 

 Exhibit A 
  
 FINANCING AGREEMENT 
  
 The CIT Group/Business Credit, Inc. 
  
 And 
  
 Cybex International, Inc. 
  
 Dated: July 16, 2003 
  
 and 
  
 Amended as of July
    , 2004 
  

 8 

 TABLE OF CONTENTS 
  

					
	 	 	 	  	Page

	 SECTION 1.
	 	Definitions	  	10
	 SECTION 2.
	 	Conditions Precedent	  	27
	 SECTION 3.
	 	Revolving Loans	  	31
	 SECTION 4.
	 	Term Loan	  	34
	 SECTION 5.
	 	Letters of Credit	  	35
	 SECTION 6.
	 	Collateral	  	38
	 SECTION 7.
	 	Representations, Warranties and Covenants	  	40
	 SECTION 8.
	 	Interest, Fees and Expenses	  	52
	 SECTION 9.
	 	Powers	  	59
	 SECTION 10.
	 	Events of Default and Remedies	  	59
	 SECTION 11.
	 	Termination	  	63
	 SECTION 12.
	 	Miscellaneous	  	64

  
 EXHIBIT 
  
 Exhibit A - Form of Term Loan Promissory Note 
  
 SCHEDULES 
  
 Schedule 1 - Collateral Information 
 Schedule 2
- Litigation 
 Schedule 3 - ERISA 
 Schedule 4 - EBITDA
Projections (2003) 
 Schedule 5 – Permitted Affiliate Payments 

 THE CIT GROUP/BUSINESS CREDIT, INC., a New York corporation, with offices located at Two Wachovia
Center, 23rd Floor, 301 South Tryon Street, Charlotte, North Carolina 28202 (hereinafter “CIT”), is
pleased to confirm the terms and conditions under which CIT shall make revolving loans, term loans and other financial accommodations to CYBEX INTERNATIONAL, INC., a New York corporation with a principal place of business at 10 Trotter Drive,
Medway, Massachusetts 02053 (herein the “Company”). 
  
 SECTION 5. Definitions 
  
 Accounts shall mean all of the Company’s now existing and future: (a) accounts (as defined in the UCC), and any and all other receivables (whether or not specifically listed on schedules furnished to CIT),
including, without limitation, all accounts created by, or arising from, all of the Company’s sales, leases, rentals of goods or renditions of services to its customers, including but not limited to, those accounts arising under any of the
Company’s trade names or styles, or through any of the Company’s divisions; (b) any and all instruments, documents, chattel paper (including electronic chattel paper) (all as defined in the UCC); (c) unpaid seller’s or
lessor’s rights (including rescission, replevin, reclamation, repossession and stoppage in transit) relating to the foregoing or arising therefrom; (d) rights to any goods represented by any of the foregoing, including rights to
returned, reclaimed or repossessed goods; (e) reserves and credit balances arising in connection with or pursuant hereto; (f) guarantees, supporting obligations, payment intangibles and letter of credit rights (all as defined in the
UCC); (g) insurance policies or rights relating to any of the foregoing; (h) general intangibles pertaining to any and all of the foregoing (including all rights to payment, including those arising in connection with bank and non-bank
credit cards), and including books and records and any electronic media and software thereto; (i) notes, deposits or property of account debtors securing the obligations of any such account debtors to the Company; and (j) cash and
non-cash proceeds (as defined in the UCC) of any and all of the foregoing. 
  
 Administrative Management Fee shall mean the annual sum of $18,000.00 which shall be paid to CIT in accordance with Section 8, paragraph 8.8 hereof to offset the expenses and costs (excluding
Out-of-Pocket Expenses and auditor fees) of CIT in connection with administration, record keeping, analyzing and evaluating the Collateral. 
  
 Affiliate shall mean any Person that, directly or indirectly, Controls, is Controlled by, or is under common Control with, a specified
Person. For the purposes of this Agreement, “Control” means having the power to direct the management and policies of a Person, whether through the ownership of voting securities or beneficial interests, by contract, or otherwise.

  
 Anniversary Date shall mean the date occurring
three (3) years from the Second Amendment Effective Date and the same date in every year thereafter. 

 Applicable Margin shall mean the appropriate applicable percentage corresponding to Fixed
Charge Coverage Ratio in effect as of the most recent Calculation Date: 
  

									
	 Tier

	  	 Fixed Charge Coverage Ratio

	  	 Applicable Margin
 for LIBOR Loans

	 	 	 Applicable Margin
 For Chase Bank
 Rate Loans

	 
	  	  	Revolving Loans

	 	 	Revolving Loans

	 
	 	  	 	  	 	 	 	 	 
	I	  	Less than 1.2 to 1.0	  	3.25	%	 	0.50	%
	II	  	Equal to or greater than 1.2 to 1.0 but less than 1.4 to 1.0	  	2.75	%	 	0.00	%
	III	  	Greater than or equal to 1.4 to 1.0	  	2.50	%	 	-0.25	%

  
 The Applicable Margin
shall be determined and adjusted quarterly on the first day of the month immediately following the receipt by CIT of the financial information for the preceding fiscal quarter in accordance with Paragraph 7.8(b) of Section 7.8 (each a
“Calculation Date”); provided, however, that (i) the initial Applicable Margin shall be based on Tier II (as shown above) and shall remain at Tier II until the first Calculation Date subsequent to the date the Bank receives
the financial statements for the fiscal quarter ending September 30, 2003, and (ii) if the Company fails to provide any financial statements for any fiscal quarter within the time period set forth herein, the Applicable Margin from the Calculation
Date applicable to such fiscal quarter shall be based on Tier I until such time as such financial statements are provided, whereupon the Applicable Margin shall be determined as set forth above. Each Applicable Margin shall be effective from one
Calculation Date until the next Calculation Date. 
  
 Availability shall mean at any time the amount by which: (a) the Borrowing Base exceeds (b) the sum of (i) the outstanding aggregate amount of all Obligations with respect to Revolving Loans and the Letters of Credit and (ii)
the Availability Reserve. 
  
 Availability Reserve
shall mean the sum of: (a) the sum of (x) three (3) months rental payments or similar charges for any of the Company’s leased premises (other than the Company’s leased premises in Portland, Oregon so long as no Inventory of the Company is
physically located there) or other Collateral locations (other than the Company’s leased premises in Portland, Oregon so long as no Inventory of the Company is physically located there) for which the Company has not delivered to CIT a
landlord’s waiver in form and substance reasonably satisfactory to CIT, plus (y) three (3) months estimated payments due by the Company to any applicable warehousemen or third party processor (as determined by CIT in its reasonable business
judgement), provided that any of the foregoing amounts shall be adjusted from time to time hereafter upon (i) delivery to CIT of any such acceptable waiver, (ii) the opening or closing of a Collateral location and/or (iii) any change in the amount
of rental, storage or processor payments or similar charges; (b) any reserve which CIT may reasonably require 
  

 11 

 from time to time pursuant to the explicit terms of this Financing Agreement, including without limitation, for Letters
of Credit pursuant to Paragraph 5.1 of Section 5 hereof; and (c) such other reserves as CIT deems necessary in its commercially reasonable judgment as a result of (x) negative forecasts and/or trends in the Company’s business, industry,
prospects, profits, operations or financial condition or (y) other issues, circumstances or facts that could otherwise negatively impact the Company, its business, prospects, profits, operations, industry, financial condition or assets. 

 
 Benefit Plan shall mean a defined benefit plan as defined in
Section 3(35) of ERISA (other than a “multiemployer plan,” as such term is defined in ERISA) in respect of which the Company or any ERISA Affiliate is, or within the immediately preceding six (6) years was, an “employer”
as defined in Section 3(5) of ERISA. 
  
 Board of
Directors means the board of directors (or comparable managers) of the Company or any committee thereof duly authorized to act on behalf of the board of directors (or comparable managers). 
  
 Borrower Agreement shall mean the Borrower Agreement between
the Company and Ex-Im Bank. 
  
 Borrowing Base shall
mean the sum of the Domestic Borrowing Base and the Foreign Borrowing Base. 
  
 Business Day shall mean any day on which CIT and JP Morgan Chase Bank are open for business. 
  
 Capital Expenditures shall mean for any period the aggregate of all expenditures of the Company during such period that, in conformity with
GAAP, are required to be included in or reflected by the property, plant or equipment or similar fixed asset account reflected in the balance sheet of the Company. 
  
 Capital Lease shall mean any lease of property (whether real, personal or mixed) which, in conformity with
GAAP, is accounted for as a capital lease or a Capital Expenditure in the balance sheet of the Company. 
  
 Chase Bank Rate shall mean the rate of interest per annum announced by JP Morgan Chase Bank from time to time as its prime rate in effect at
its principal office in New York City. (The prime rate is not intended to be the lowest rate of interest charged by JP Morgan Chase Bank to its borrowers). 
  
 Chase Bank Rate Loans shall mean any loans or advances pursuant to this Financing Agreement made or maintained at a rate of interest based
upon the Chase Bank Rate. 
  
 Closing Date shall
mean the date that this Financing Agreement has been duly executed by the parties hereto and delivered to CIT. 
  

 12 

 Collateral shall mean all present and future Accounts, Inventory, Documents of Title,
General Intangibles, Investment Property, pledged stock of the Company’s subsidiaries and Other Collateral. 
  
 Collection Days shall mean one (1) Business Day to provide for the deposit, clearance and collection of checks or other instruments
representing the proceeds of Collateral, the amount of which has been credited to the Company’s Revolving Loan Account, and for which interest may be charged on the aggregate amount of such deposits, at the rate provided for in Paragraph 8.1 of
Section 8 of this Financing Agreement. 
  
 Commitment
Letter shall mean the Commitment Letter, dated June 12, 2003, issued by CIT to, and accepted by, the Company. 
  
 Consolidated Balance Sheet shall mean a consolidated or compiled, as applicable, balance sheet for the Company and its consolidated
subsidiaries, eliminating all inter-company transactions and prepared in accordance with GAAP. 
  
 Consolidating Balance Sheet shall mean a Consolidated Balance Sheet plus individual balance sheets for the Company and its consolidated subsidiaries, showing all eliminations of inter-company
transactions and prepared in accordance with GAAP, and including a balance sheet for the Company exclusively. 
  
 Continuing Director means (a) any member of the Board of Directors who was a director (or comparable manager) of the Company on the Closing
Date, and (b) any individual who becomes a member of the Board of Directors after the Closing Date if such individual was appointed or nominated for election to the Board of Directors by a majority of the Continuing Directors, but excluding any such
individual originally proposed for election in opposition to the Board of Directors in office at the Closing Date in an actual or threatened election contest relating to the election of the directors (or comparable managers) of the Company and whose
initial assumption of office resulted from such contest or the settlement thereof. 
  
 Copyrights shall mean all present and hereafter acquired copyrights, copyright registrations, recordings, applications, designs, styles, licenses, marks, prints and labels bearing any of the foregoing,
goodwill, any and all general intangibles, intellectual property and rights pertaining thereto, and all cash and non-cash proceeds thereof. 
  
 Current Assets shall mean those assets of the Company which, in accordance with GAAP, are classified as current. 
  
 Current Liabilities shall mean those liabilities of the Company
which, in accordance with GAAP, are classified as “current”, provided however, that, notwithstanding GAAP, the Revolving Loans and the current portion of Permitted Indebtedness shall be considered “current liabilities”.

  
 Cybex UK shall mean Cybex International UK
Limited. 
  

 13 

 Default shall mean any event specified in Section 10 hereof, whether or not any requirement
for the giving of notice, the lapse of time, or both, or any other condition, event or act, has been satisfied. 
  
 Default Rate of Interest shall mean a rate of interest per annum on any Obligations hereunder, equal to the sum of: (a) two percent (2%) and
(b) the applicable interest rates set forth in Paragraphs 8.1, 8.2 and 8.14 which CIT shall be entitled to charge the Company on all Obligations due CIT by the Company, as further set forth in Paragraph 10.2 of Section 10 of this Financing
Agreement. 
  
 Depository Accounts shall mean the
collection accounts, which are subject to CIT’s instructions, as specified in Paragraph 3.4 of Section 3 of this Financing Agreement. 
  
 Documentary Letter of Credit Sub-Line shall mean the commitment of CIT to assist the Company in obtaining documentary Letters of Credit,
pursuant to Section 5 hereof, in an aggregate amount of $4,000,000. 
  
 Documentation Fee shall mean subsequent to the Closing Date, CIT’s standard fees relating to any and all modifications, waivers, releases, amendments or additional collateral with respect to this
Financing Agreement, the Collateral and/or the Obligations. 
  
 Documents of Title shall mean all present and future documents (as defined in the UCC), and any and all warehouse receipts, bills of lading, shipping documents, chattel paper, instruments and similar documents, all whether
negotiable or not and all goods and Inventory relating thereto and all cash and non-cash proceeds of the foregoing. 
  
 Domestic Borrowing Base shall mean the sum of (a) eighty-five percent (85%) of the Company’s aggregate outstanding Eligible Domestic
Accounts Receivable, plus (b) fifty percent (50%) of aggregate value of the Company’s Eligible Domestic Inventory which consists of raw materials, valued at the lower of cost or market, on a first in, first out basis, plus (c) sixty percent
(60%) of the aggregate value of the Company’s Eligible Domestic Inventory which consists of finished goods, valued at the lower of cost or market, on a first in, first out basis, plus (d) one hundred percent (100%) of all letters of credit
issued to CIT and accepted by CIT in its sole discretion for purposes of securing the Obligations. 
  
 Early Termination Date shall mean the date on which the Company terminates this Financing Agreement or the Revolving Line of Credit which
date is prior to an Anniversary Date. 
  
 Early Termination
Fee shall: (a) mean the fee CIT is entitled to charge the Company in the event the Company terminates the Revolving Line of Credit or this Financing Agreement on a date prior to an Anniversary Date; and (b) be determined by multiplying the
Revolving Line of Credit by (x) two percent (2%) if the Early Termination Date occurs on or before one (1) year from the Second Amendment Effective Date, (y) one percent (1%) if the Early Termination Date occurs after one (1) year from the Second
Amendment Effective Date but on or before two (2) years from the Second Amendment Effective Date; and (z) zero percent (0%) if the Early Termination Date occurs thereafter. 
  

 14 

 EBIT shall mean, in any period, all earnings of the Company for said period before all
interest and tax obligations of the Company for said period, determined in accordance with GAAP on a consistent basis with the latest audited financial statements of the Company, but excluding the effect of extraordinary or non-reoccurring gains or
losses for such period. 
  
 EBITDA shall mean, in
any period, all earnings of the Company for said period before all interest and tax obligations of the Company for said period and all depreciation and amortization expense for said period, determined in accordance with GAAP on a consistent basis
with the latest audited financial statements of the Company, but excluding the effect of extraordinary or non-reoccurring gains or losses for such period. 
  
 Eligible Domestic Accounts Receivable shall mean the gross amount of the Company’s Trade Accounts Receivable that are subject to a
valid, exclusive, first priority and fully perfected security interest in favor of CIT, which conform to the warranties contained herein and at all times continue to be acceptable to CIT in the exercise of its reasonable business judgment,
less, without duplication, the sum of: (a) any returns, discounts, claims, credits and allowances of any nature (whether issued, owing, granted, claimed or outstanding), and (b) reserves for any such Trade Accounts Receivable that arise from
or are subject to or include: (i) sales to the United States of America, any state or other governmental entity or to any agency, department or division thereof, except for any such sales as to which the Company has complied with the Assignment of
Claims Act of 1940 or any other applicable statute, rules or regulation, to CIT’s satisfaction in the exercise of its reasonable business judgment; (ii) foreign sales, other than sales which otherwise comply with all of the other criteria for
eligibility hereunder and are secured by letters of credit (in form and substance satisfactory to CIT) issued or confirmed by, and payable at, banks having a place of business in the United States of America; (iii) Accounts that are more than 60
days past due; (iv) Accounts that remain unpaid more than ninety (90) days from invoice date (except for those such Accounts which are less than $300,000 in the aggregate and which do not remain unpaid more than one hundred fifty (150) days from
invoice date); (v) contra accounts; (vi) sales to any subsidiary, or to any company affiliated with the Company in any way; (vii) bill and hold (deferred shipment) or consignment sales; (viii) sales to any customer which is (A) insolvent or (B) the
debtor in any bankruptcy, insolvency, arrangement, reorganization, receivership or similar proceedings under any federal or state law or (C) negotiating, or has called a meeting of its creditors for purposes of negotiating, a compromise of its debts
or (D) financially unacceptable to CIT or has a credit rating unacceptable to CIT; (ix) all sales to any customer if fifty percent (50%) or more of the aggregate dollar amount of all outstanding invoices to such customer are more than 60 days past
due or remain unpaid more than ninety (90) days from invoice date (except for those such Accounts which are less than $300,000 in the aggregate and which do not remain unpaid more than one hundred fifty (150) days from invoice date); (x) pre-billed
receivables and receivables arising from progress billing; (xi) an amount representing, historically, returns, discounts, claims, credits, allowances and applicable terms; (xii) sales not payable in United States currency; and (xiii) any other
reasons deemed necessary by CIT in its reasonable business judgment, including those which are customary either in the commercial finance industry or in the lending practices of CIT. 
  

 15 

 Eligible Domestic Inventory shall mean the gross amount of the Company’s Inventory
that is subject to a valid, exclusive, first priority and fully perfected security interest in favor of CIT and which conforms to the warranties contained herein and which at all times continue to be acceptable to CIT in the exercise of its
reasonable business judgment, less, without duplication, any (a) work-in-process, (b) supplies (other than raw materials), (c) Inventory not present in the United States of America or Inventory which is Export-Related Inventory, (d) Inventory
returned or rejected by the Company’s customers (other than goods that are undamaged and resalable in the normal course of business) and goods to be returned to the Company’s suppliers, (e) Inventory in transit to third parties (other than
the Company’s agents or warehouses), or Inventory in possession of a warehouseman, bailee, third party processor, or other third party, unless such warehouseman, bailee or third party has executed a notice of security interest agreement (in
form and substance satisfactory to CIT) and CIT shall have a first priority perfected security interest in such Inventory, and (f) less any reserves required by CIT in its reasonable discretion, including for special order goods, discontinued,
slow-moving and obsolete Inventory, market value declines, bill and hold (deferred shipment), consignment sales, shrinkage and any applicable customs, freight, duties and Taxes. 
  
 Eligible Foreign Accounts Receivables shall mean, at the date of determination, all Foreign Accounts of the
Company and Cybex UK which would be included in the determination of the Foreign Borrowing Base in accordance with the Ex-Im Bank Documents and would otherwise be Eligible Domestic Accounts Receivable but for clause (b)(ii) of the definition thereof
and without regard to the $300,000 limitation set forth in clause (b) (iv) of the definition thereof. 
  
 Eligible Foreign Inventory shall mean at the date of determination, all Export-Related Inventory which would be included in the
determination of the Foreign Borrowing Base in accordance with the Ex-Im Bank Documents and would otherwise be Eligible Domestic Inventory but for clause (c) of the definition thereof. 
  
 Equipment shall mean all present and hereafter acquired equipment (as defined in the UCC) including, without
limitation, all machinery, equipment, furnishings and fixtures, and all additions, substitutions and replacements thereof, wherever located, together with all attachments, components, parts, equipment and accessories installed thereon or affixed
thereto and all proceeds thereof of whatever sort. 
  
 ERISA shall mean the Employee Retirement Income Security Act or 1974, as amended from time to time and the rules and regulations promulgated thereunder from time to time. 
  
 ERISA Affiliate shall mean any (i) corporation which is or was
at any time a member of the same controlled group of corporations (within the meaning of Section 414(b) of the Internal Revenue Code) as the Company; (ii) partnership or other trade or business (whether or not incorporated) at any time under
common control (within the meaning of Section 414(c) of the Internal Revenue Code) with the Company; and (iii) member of the same affiliated service group (within the meaning of Section 414(m) of the Internal Revenue Code) as the
Company, any corporation described in clause (i) above, or any partnership or trade or business described in clause (ii) above. 
  

 16 

 Eurocurrency Reserve Requirements for any day, as applied to a LIBOR Loan, shall mean the
aggregate (without duplication) of the maximum rates of reserve requirements (expressed as a decimal fraction) in effect with respect to CIT and/or any present or future lender or participant on such day (including, without limitation, basic,
supplemental, marginal and emergency reserves under Regulation D or any other applicable regulations of the Board of Governors of the Federal Reserve System or other governmental authority having jurisdiction with respect thereto, as now and from
time to time in effect, dealing with reserve requirements prescribed for Eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in Regulation D of such Board) maintained by CIT and/or any such lenders or participants
(such rate to be adjusted to the nearest one sixteenth of one percent (1/16 of 1%) or, if there is not a nearest one sixteenth of one percent (1/16 of 1%), to the next higher one sixteenth of one percent (1/16 of 1%)). 
  
 Event(s) of Default shall have the meaning provided for in
Section 10 of this Financing Agreement. 
  
 Executive
Officers shall mean the Chairman, President, Chief Executive Officer, Chief Operating Officer, Chief Financial Officer, Executive Vice President(s), Senior Vice President(s), Treasurer, Controller and Secretary of the Company. 
  
 Ex-Im Bank shall mean the Export-Import Bank of the United
States. 
  
 Ex-Im Bank Documents shall mean the
Ex-Im Bank Guarantee, the Loan Authorization Agreement between CIT and Ex-Im Bank and the Borrower Agreement. 
  
 Ex-Im Guarantee shall mean the guarantee executed by Ex-Im Bank in favor of CIT and in form and substance satisfactory to CIT, together with
all amendments, modifications and supplements thereto. 
  
 Export-Related Inventory shall mean, at the date of determination, all Inventory of the Company and Cybex UK that has been purchased or manufactured by the Company or Cybex UK for re-sale in an Export Transaction and for which
Company or Cybex UK has received a signed written purchase order acceptable to CIT from the buyer in such Export Transaction. 
  
 Export Transaction shall mean any transaction in which the Company or Cybex UK will sell goods or services to an account debtor located in a
foreign country. 
  
 Fiscal Quarter shall mean, with
respect to the Company, each three (3) month period ending on the last Saturday in March, June and September and December 31 of each Fiscal Year. 
  
 Fiscal Year shall mean each twelve (12) month period commencing on January 1 of each year and ending on the following December 31.

  

 17 

 Fixed Charge Coverage Ratio shall mean, for any applicable period of computation, the ratio
of the following for the Company and its subsidiaries on a consolidated basis determined in accordance with GAAP: (a) EBITDA less non-financed Capital Expenditures for such period, less, without duplication, losses incurred in respect of Support
Obligations during such period to (b) Fixed Charges for such period. 
  
 Fixed Charges shall mean, for any applicable twelve-month period of computation, the sum of (a) interest expense paid or accrued (other than interest accrued with respect to any Subordinated Debt) in respect of any
Indebtedness during such period, without duplication, plus (b) taxes to the extent paid during or with respect to such period plus (c) regularly scheduled payments of principal paid on Indebtedness (excluding the Revolving Loans)
during such period. 
  
 Foreign Accounts shall mean
those Accounts of the Company and Cybex UK that are an obligation of an account debtor located in a foreign country and which arise from an Export Transaction. 
  

Foreign Borrowing Base shall mean the sum of (a) ninety percent (90%) of the Company’s aggregate outstanding Eligible Foreign
Accounts Receivable, plus (b) seventy percent (70%) of Cybex UK’s aggregate outstanding Eligible Foreign Accounts Receivable, plus (c) seventy-five percent (75%) of aggregate value of the Company’s Eligible Foreign Inventory which consists
of raw materials, work-in-process and finished goods, valued at the lower of cost or market, on a first in, first out basis, plus (d) fifty-five percent (55%) of aggregate value of Cybex UK’s Eligible Foreign Inventory which consists of raw
materials, work-in-process and finished goods, valued at the lower of cost or market, on a first in, first out basis. 
  
 Funded Debt shall have the meaning set forth in the GMAC Loan Agreement as in effect on the Second Amendment Effective Date. 
  
 GAAP shall mean generally accepted accounting principles in the
United States of America as in effect from time to time and for the period as to which such accounting principles are to apply, provided that in the event the Company modifies its accounting principles and procedures as applied as of the Closing
Date, the Company shall provide such statements of reconciliation as shall be in form and substance) acceptable to CIT. 
  
 General Intangibles shall mean all present and hereafter acquired general intangibles (as defined in the UCC), and shall include, without
limitation, all present and future right, title and interest in and to: (a) all Trademarks, tradenames, corporate names, business names, logos and any other designs or sources of business identities, (b) Patents, together with any improvements on
said Patents, utility models, industrial models, and designs, (c) Copyrights, (d) trade secrets, (e) licenses, (f) all applications with respect to the foregoing, (g) all right, title and interest in and to any and all extensions and renewals, (h)
goodwill with respect to any of the foregoing, (i) any other forms of similar intellectual property, (j) all customer lists, distribution agreements, supply agreements, blueprints, indemnification rights and tax refunds, together with all monies and
claims for monies now or hereafter due and payable in connection with any of the foregoing or otherwise, and all cash and non-cash proceeds thereof, including, without limitation, the proceeds or royalties of any licensing agreements between the
Company and any licensee of any of the Company’s General Intangibles. 
  

 18 

 GMAC shall mean GMAC Commercial Finance, its successors and permitted assigns and any
replacement lender under the GMAC Loan Agreement. 
  
 GMAC
Intercreditor Agreement shall mean the Intercreditor Agreement between GMAC and CIT dated July     , 2004. 
  
 GMAC Loan shall mean the $13,000,000.00 term loan made by GMAC to the Company as of the Second Amendment Effective Date. 
  
 GMAC Loan Agreement shall mean the Credit Agreement, dated as
of the Second Amendment Effective Date, between GMAC and the Company, as the same now exists or may hereafter be amended, modified, supplemented, extended, renewed, restated or refinanced from time to time in accordance with Section 7.9(e) of this
Agreement. 
  
 GMAC Loan Documents shall mean the
GMAC Loan Agreement and all other documents, instruments, and agreements executed from time to time in connection with the GMAC Loan Agreement, as all of the foregoing now exist or may hereafter be amended, modified, supplemented, extended, renewed,
restated or refinanced from time to time in accordance with Section 7.9(e) of this Agreement. 
  
 Guaranties shall mean the guaranty documents executed and delivered by the Guarantors guaranteeing the Obligations. 
  
 Guarantors shall mean Tectrix Fitness Equipment, Inc., Cybex Capital Corporation and Cybex UK. 
  
 Inactive Subsidiary shall mean Cybex Fitness Gerate Vertriebes
GmbH. 
  
 Indebtedness shall mean, without
duplication, all liabilities, contingent or otherwise, which are any of the following: (a) obligations in respect of borrowed money or for the deferred purchase price of property, services or assets, other than Inventory, or (b) lease obligations
which, in accordance with GAAP, have been, or which should be capitalized. 
  
 Insurance Proceeds shall mean proceeds or payments from an insurance carrier with respect to any loss, casualty or damage to Collateral. 
  
 Interest Period shall mean: 
  
 (a) with respect to any initial request by the Company for a LIBOR Loan, a one month, two month or three
month period commencing on the borrowing or conversion date with respect to a LIBOR Loan and ending one, two or three months thereafter, as applicable; and 
  

 19 

 (b) hereafter with respect to any continuation of, or conversion to, a LIBOR Loan, at the
option of the Company, any one month, two month or three month period commencing on the last day of the immediately preceding Interest Period applicable to such LIBOR Loan and ending one, two or three months thereafter, as applicable; 
  
 provided that, the foregoing provisions relating to Interest Periods
are subject to the following: 
  
 (i) if any
Interest Period would otherwise end on a day which is not a Working Day, that Interest Period shall be extended to the next succeeding Working Day, unless the result of such extension would extend such payment into another calendar month in which
event such Interest Period shall end on the immediately preceding Working Day; 
  
 (ii) any Interest Period that begins on the last Working Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month, at the end of such Interest Period) shall end on the last Working Day of a calendar month; and 
  
 (iii) for purposes of determining the availability of Interest Periods, such Interest Periods shall be deemed available if (x) JP Morgan
Chase Bank quotes an applicable rate or CIT determines LIBOR, as provided in the definition of LIBOR, (y) the LIBOR determined by JP Morgan Chase Bank or CIT will adequately and fairly reflect the cost of maintaining or funding its loans bearing
interest at LIBOR, for such Interest Period, and (z) such Interest Period will end on or before the earlier of Anniversary Date or the last day of the then current term of this Financing Agreement. If a requested Interest Period shall be unavailable
in accordance with the foregoing sentence, the Company shall continue to pay interest on the Obligations at the applicable per annum rate based upon the Chase Bank Rate. 
  
 Inventory shall mean all of the Company’s present and hereafter acquired inventory (as defined in the
UCC) and including, without limitation, all merchandise, inventory and goods, and all additions, substitutions and replacements thereof, wherever located, together with all goods and materials used or usable in manufacturing, processing, packaging
or shipping same in all stages of production from raw materials through work-in-process to finished goods - and all proceeds thereof of whatever sort. 
  
 Investment Property shall mean the Company’s now owned or hereafter acquired right, title and interest with respect to “investment
property” as that term is defined in the UCC, and any and all supporting obligations in respect thereof. 
  
 IRB shall mean the Massachusetts Industrial Finance Agency Industrial Revenue Bonds – United Medical Corporation Issue – Series
1992 in the original principal amount of $3,779,069. 
  
 IRB
Letter of Credit shall mean the letter of credit issued by Wachovia Bank, National Association on the application of the Company providing credit support for the IRB. 
  

 20 

 Issuing Bank shall mean the bank issuing Letters of Credit for the Company. 
  
 Kirila Letter of Credit shall mean the letter of credit
obtained by the Borrower in the amount of $2,945,722 to secure a potential judgment against the Borrower relating to the case of Kirila v. Cybex International, Inc. 
  
 Letters of Credit shall mean all letters of credit issued with the assistance of CIT in accordance with
Section 5 hereof by the Issuing Bank for or on behalf of the Company. 
  
 Letter of Credit Guaranty Fee shall mean the fee CIT may charge the Company under Paragraph 8.3 of Section 8 of this Financing Agreement for: (a) issuing a Letter of Credit Guaranty, and/or (b) otherwise aiding the Company in
obtaining Letters of Credit, all pursuant to Section 5 hereof. 
  
 Leverage Ratio shall mean, for any applicable period of computation, the ratio of the following for the Company and its subsidiaries on a consolidated basis determined in accordance with GAAP: (a) Funded Debt of the Company
and its subsidiaries as of the end of such period to (b) EBITDA for such period. 
  
 LIBOR shall mean, at any time of determination, and subject to availability, for each applicable Interest Period, a variable rate of interest equal to: (a) at CIT’s election (i) the applicable LIBOR
quoted to CIT by JP Morgan Chase Bank (or any successor thereof), or (ii) the rate of interest determined by CIT at which deposits in U.S. dollars are offered for the relevant Interest Period based on information presented on Telerate Systems at
Page 3750 as of 11:00 A.M. (London time) on the day which is two (2) Business Days prior to the first day of such Interest Period, provided that, if at least two such offered rates appear on the Telerate System at Page 3750 in respect
of such Interest Period, the arithmetic mean of all such rates (as determined by CIT) will be the rate used; divided by (b) a number equal to 1.0 minus the aggregate (but without duplication) of the rates (expressed as a decimal fraction) of
Eurocurrency Reserve Requirements in effect on the day which is two (2) Business Days prior to the beginning of such Interest Period. 
  
 LIBOR Lending Office with respect to CIT, shall mean the office of JP Morgan Chase Bank, or any successor thereof, maintained at 270 Park
Avenue, New York, NY 10017. 
  
 LIBOR Loan shall
mean any loans made pursuant to this Financing Agreement which are made or maintained at a rate of interest based upon LIBOR, provided that (i) no Default or Event of Default has occurred hereunder, which has not been waived in writing by CIT, and
(ii) no LIBOR Loan shall be made with an Interest Period that ends subsequent to an Anniversary Date or any applicable Early Termination Date. 
  
 Line of Credit shall mean the aggregate commitment of CIT to (a) make Revolving Loans pursuant to Section 3 of this Financing Agreement (b)
assist the Company in opening Letters of Credit pursuant to Section 5 of this Financing Agreement and (c) make the Term Loan pursuant to Section 4 of this Financing Agreement, in the aggregate amount equal to $18,000,000. 
  

 21 

 Line of Credit Fee shall: (a) mean the fee due CIT at the end of each month for the
Line of Credit, and (b) be determined by multiplying the difference between (i) the Revolving Line of Credit (less $1,000,000) and (ii) the sum, for said month, of (x) the average daily balance of Revolving Loans plus (y) the average daily
balance of Letters of Credit outstanding, by three-eighths percent (0.375%) per annum for the number of days in said month. 
  
 Loan Documents shall mean this Financing Agreement, the Promissory Note, the Guaranties, the Pledge Agreement, any warrants, the other
closing documents and any other ancillary loan and security agreements executed from time to time in connection with this Financing Agreement, all as may be renewed, amended, extended, increased or supplemented from time to time. 
  
 Loan Facility Fee shall mean the fee payable to CIT in
accordance with, and pursuant to, the provisions of Paragraph 8.7 of Section 8 of this Financing Agreement. 
  
 Mandatory Prepayment shall: (a) mean the amount by which the Company must prepay the Term Loan on or before the 90th day after the end of
each Fiscal Year of the Company; and (b) be determined as set forth in Paragraph 4.6 of Section 4 of this Financing Agreement. 
  
 Net Income shall mean with respect to any person and for any period, the aggregate net income (or loss) after taxes of such person for such
period, determined in accordance with GAAP. 
  
 Obligations shall mean all loans, advances and extensions of credit made or to be made by CIT to the Company or to others for the Company’s account (including, without limitation, all Revolving Loans, Letter of Credit
Guaranties and the Term Loan); any and all indebtedness and obligations which may at any time be owing by the Company to CIT howsoever arising, whether now in existence or incurred by the Company from time to time hereafter; whether secured by
pledge, lien upon or security interest in any of the Company’s Collateral, assets or property or the assets or property of any other person, firm, entity or corporation; whether such indebtedness is absolute or contingent, joint or several,
matured or unmatured, direct or indirect and whether the Company is liable to CIT for such indebtedness as principal, surety, endorser, guarantor or otherwise. Obligations shall also include indebtedness owing to CIT by the Company under any Loan
Document or under any other agreement or arrangement now or hereafter entered into between the Company and CIT; indebtedness or obligations incurred by, or imposed on, CIT as a result of environmental claims arising out of the Company’s
operations, premises or waste disposal practices or sites in accordance with paragraph 7.7 hereof; the Company’s liability to CIT as maker or endorser of any promissory note or other instrument for the payment of money; the Company’s
liability to CIT under any instrument of guaranty or indemnity, or arising under any guaranty, endorsement or undertaking which CIT may make or issue to others for the Company’s account, including any accommodation extended with respect to
applications for Letters of Credit, CIT’s acceptance of drafts or CIT’s endorsement of notes or other instruments for the Company’s account and benefit. 
  

 22 

 Other Collateral shall mean all now owned and hereafter acquired lockbox, blocked account
and any other deposit accounts maintained with any bank or financial institutions into which the proceeds of Collateral are or may be deposited; all cash and other monies and property in the possession or control of CIT; all books, records, ledger
cards, disks and related data processing software at any time evidencing or containing information relating to any of the Collateral described herein or otherwise necessary or helpful in the collection thereof or realization thereon; and all cash
and non-cash proceeds of the foregoing. 
  
 Out-of-Pocket
Expenses shall mean all of CIT’s present and future expenses incurred relative to this Financing Agreement or any other Loan Documents, whether incurred heretofore or hereafter, which expenses shall include, without being limited to:
the cost of record searches, all costs and expenses incurred by CIT in opening bank accounts, depositing checks, receiving and transferring funds, and wire transfer charges, any charges imposed on CIT due to returned items and “insufficient
funds” of deposited checks and CIT’s standard fees relating thereto, any amounts paid by, incurred by or charged to, CIT by the Issuing Bank under the Letter of Credit Guaranty or the Company’s reimbursement agreement, application for
Letter of Credit or other like document which pertain either directly or indirectly to such Letters of Credit, and CIT’s standard fees relating to the Letters of Credit and any drafts thereunder, travel, lodging and similar expenses of
CIT’s personnel in connection with inspecting and monitoring the Collateral from time to time hereunder (including field examination fees of $750 per person per day plus out-of-pocket expenses), any applicable counsel fees and disbursements,
fees and taxes relative to the filing of financing statements, and all expenses, costs and fees set forth in Paragraph 10.3 of Section 10 of this Financing Agreement. 
  
 Overadvance Rate shall mean a rate equal to two percent (2%) per annum in excess of the applicable contract
rate of interest determined in accordance with Section 8, Paragraph 8.1(a) of this Financing Agreement. 
  
 Overadvances shall mean the amount by which (a) the sum of all outstanding Revolving Loans and Letters of Credit exceed (b) the Borrowing
Base less $1,000,000.00. 
  
 Patents shall
mean all of the Company’s present and hereafter acquired patents, patent applications, registrations, any reissues or renewals thereof, licenses, any inventions and improvements claimed thereunder, and all general intangible, intellectual
property and patent rights with respect thereto of the Company and all income, royalties, cash and non-cash proceeds thereof. 
  
 Permitted Encumbrances shall mean: (a) liens existing on the date hereof on specific items of Equipment and other liens expressly permitted,
or consented to in writing by CIT; (b) Purchase Money Liens; (c) liens of local or state authorities for franchise or other like Taxes, provided that the aggregate amounts of such liens shall not exceed $100,000.00 in the aggregate at any one time;
(d) statutory liens of landlords and liens of carriers, warehousemen, mechanics, materialmen and other like liens imposed by law, created in the ordinary course of business and for amounts not yet due (or which are being contested in good faith, by
appropriate proceedings or other appropriate actions which are sufficient to prevent imminent foreclosure of such liens) 
  

 23 

 and with respect to which adequate reserves or other appropriate provisions are being maintained by the Company in
accordance with GAAP; (e) deposits made (and the liens thereon) in the ordinary course of business of the Company (including, without limitation, security deposits for leases, indemnity bonds, surety bonds and appeal bonds) in connection with
workers’ compensation, unemployment insurance and other types of social security benefits or to secure the performance of tenders, bids, contracts (other than for the repayment or guarantee of borrowed money or purchase money obligations),
statutory obligations and other similar obligations arising as a result of progress payments under government contracts; (f) easements (including, without limitation, reciprocal easement agreements and utility agreements), encroachments, minor
defects or irregularities in title, variation and other restrictions, charges or encumbrances (whether or not recorded) affecting the Real Estate, if applicable, and which in the aggregate (A) do not materially interfere with the occupation, use or
enjoyment by the Company in its business of the property so encumbered and (B) in the reasonable business judgment of CIT do not materially and adversely affect the value of such Real Estate; and (g) liens granted CIT by the Company; (h) liens of
judgment creditors provided such liens do not exceed, in the aggregate, at any time, $50,000.00 (other than liens bonded or insured to the reasonable satisfaction of CIT); (i) tax liens which are not yet due and payable or which are being diligently
contested in good faith by the Company by appropriate proceedings, and which liens are not (x) filed on any public records, (y) other than with respect to Real Estate, senior to the liens of CIT or (z) for Taxes due the United States of America or
any state thereof having similar priority statutes, as further set forth in paragraph 7.6 hereof; (j) liens on the Company’s assets to secure the GMAC Loan; and (k) liens and encumbrances and other title exceptions noted on the title insurance
policies for the Real Estate delivered to and accepted by CIT on the Closing Date. 
  
 Permitted Indebtedness shall mean: (a) Indebtedness under the GMAC Loan; provided, that such Indebtedness shall not exceed $13,000,000 at any time in the aggregate; (b) Indebtedness
under the IRB, provided that such Indebtedness is not secured by any assets of the Company; (c) current Indebtedness (other than Indebtedness for borrowed money) maturing in less than one year and incurred in the ordinary course of business
for raw materials, supplies, equipment, services, Taxes or labor; (d) the Indebtedness secured by Purchase Money Liens; (e) Subordinated Debt; (f) Indebtedness arising under the Letters of Credit and this Financing Agreement;
(g) deferred Taxes and other expenses incurred in the ordinary course of business; and (h) recourse Indebtedness with respect to leases and third party financing arrangements pertaining to the Company’s products and related
matters (the “Support Obligations”) which shall not at any time exceed $6,000,000 in the aggregate; (i) the Kirila Letter of Credit (including the related reimbursement obligations to UM Holdings Ltd.); (j) other Indebtedness
existing on the date of execution of this Financing Agreement and listed in the most recent financial statement delivered to CIT or otherwise disclosed to CIT in writing prior to the Closing Date; and (k) Indebtedness incurred or acquired
after the Second Amendment Effective Date consisting of Capital Leases; provided that (i) each lien securing such Capital Leases shall attach only to the property being leased, (ii) a description of the assets being leased is furnished to
CIT, and (iii) the debt incurred in connection with such Capital Leases shall not exceed, in the aggregate, $1,000,000.00 in any Fiscal Year. 
  
 Person shall mean any individual, corporation, governmental authority, partnership, limited liability company, unincorporated business
association, trust or other entity. 
  

 24 

 Pledge Agreement shall mean the Stock Pledge Agreement dated July 16, 2003 from the Company
in favor of the Lender. 
  
 Promissory Note shall
mean the Term Loan Promissory Note. 
  
 Purchase Money
Liens shall mean liens on any item of Equipment acquired after the date of this Financing Agreement provided that (a) each such lien shall attach only to the property to be acquired, (b) a description of the Equipment so
acquired is furnished to CIT, and (c) the debt incurred in connection with such acquisitions shall not exceed, in the aggregate, $300,000.00 in any Fiscal Year. 
  
 Real Estate shall mean the Company’s fee and/or leasehold interests in real property. 
  
 Revolving Line of Credit shall mean the aggregate commitment of
CIT to make loans and advances pursuant to Section 3 of this Financing Agreement and issue Letters of Credit Guaranties pursuant to Section 5 hereof to the Company, in the aggregate amount of $14,000,000.00. 
  
 Revolving Loan Account shall mean the account on CIT’s
books, in the Company’s name, in which the Company will be charged with all Obligations under this Financing Agreement. 
  
 Revolving Loans shall mean the loans and advances made, from time to time, to or for the account of the Company by CIT pursuant to Section 3
of this Financing Agreement. 
  
 Second Amendment
shall mean the Second Amendment to the Financing Agreement, dated as of July     , 2004 between the Company and CIT. 
  
 Second Amendment Effective Date shall have the meaning set forth in the Second Amendment. 
  
 Standby Letter of Credit Sub-Line shall mean the commitment of
CIT to assist the Company in obtaining standby Letters of Credit, pursuant to Section 5 hereof, in an aggregate amount of $4,000,000. 
  
 Support Obligations shall have the meaning given to such term in the definition of “Permitted Indebtedness.” 
  
 Subordinated Debt shall mean the debt due a Subordinating
Creditor (and the note(s) evidencing such) which has been subordinated, by a Subordination Agreement, to the prior payment and satisfaction of the Obligations of the Company to CIT. 
  
 Subordinating Creditor shall mean UM Holdings, Ltd. and any other party hereafter executing a Subordination
Agreement. 
  

 25 

 Subordination Agreement shall mean the agreement (in form and substance satisfactory to
CIT) among the Company, a Subordinating Creditor and CIT pursuant to which Subordinated Debt is subordinated to the prior payment and satisfaction of the Company’s Obligations to CIT. 
  
 Surplus Cash shall mean for any Fiscal Year (a) the sum of (i)
EBIT and (ii) depreciation less (b) the sum of (i) all interest obligations paid or due by the Company, (ii) the amount of principal repaid CIT on the Term Loan and the amount of any principal repaid to GMAC in accordance with the terms of the GMAC
Loan, (iii) unfunded Capital Expenditures actually incurred, and (iv) all federal, state and local tax obligations of the Company. 
  
 Taxes shall mean all federal, state, municipal and other governmental taxes, levies, charges, claims and assessments which are or may be due
by the Company with respect to its business, operations, Collateral or otherwise. 
  
 Term Loan Promissory Note shall mean the promissory note in the form of Exhibit A hereto executed by the Company to evidence Term Loan made by CIT under Section 4 hereof. 
  
 Term Loan shall mean the term loan in the principal amount of
$4,000,000.00 made by CIT pursuant to, and repayable in accordance with, the provisions of Section 4 of this Financing Agreement. 
  
 Total Assets shall mean total assets determined in accordance with GAAP, on a basis consistent with the latest audited financial statements
of the Company. 
  
 Total Liabilities
shall mean total liabilities determined in accordance with GAAP, on a basis consistent with the latest audited financial statements of the Company. 
  
 Trade Accounts Receivable shall mean that portion of the Company’s Accounts which arises from the sale of Inventory or the rendition of
services in the ordinary course of the Company’s business. 
  
 Trademarks shall mean all present and hereafter acquired trademarks, trademark registrations, recordings, applications, tradenames, trade styles, service marks, prints and labels (on which any of the foregoing may appear),
licenses, reissues, renewals, and any other intellectual property and trademark rights pertaining to any of the foregoing, together with the goodwill associated therewith, and all cash and non-cash proceeds thereof. 
  
 Transfer shall mean any conveyance, transfer, pledge,
assignment, hypothecation, refinancing, mortgage, encumbrance, gift, sale, lease (including any amendment, extension, modification, waiver or renewal thereof), lien, or other disposition, whether direct or indirect, legal or beneficial, by law or
otherwise. 
  
 UCC shall mean the Uniform Commercial
Code as in effect from time to time in the state of New York. 
  
 Working Capital shall mean Current Assets in excess of Current Liabilities. 
  

 26 

 Working Day shall mean any Business Day on which dealings in foreign currencies and
exchanges between banks may be transacted. 
  
 SECTION 6.
Conditions Precedent 
  
 6.1 The obligation of
CIT to make the initial loans hereunder is subject to the satisfaction of, extension of or waiver of, on or prior to, the Closing Date, the following conditions precedent: 
  
 (a) Lien Searches - CIT shall have received tax, judgment and Uniform Commercial Code searches
satisfactory to CIT for all locations presently occupied or used by the Company. 
  
 (b) Casualty Insurance - The Company shall have delivered to CIT evidence satisfactory to CIT that casualty insurance
policies listing CIT as loss payee or mortgagee, as the case may be, are in full force and effect, all as set forth in Paragraph 7.5 of Section 7 of this Financing Agreement. 
  
 (c) UCC Filings - Any financing statements required to be filed in order to create, in favor
of CIT, a first perfected security interest in the Collateral, subject only to the Permitted Encumbrances, shall have been properly filed in each office in each jurisdiction required in order to create in favor of CIT a perfected lien on the
Collateral. CIT shall have received acknowledgment copies of all such filings (or, in lieu thereof, CIT shall have received other evidence satisfactory to CIT that all such filings have been made) and CIT shall have received evidence that all
necessary filing fees and all taxes or other expenses related to such filings have been paid in full. 
  
 (d) Board Resolution - CIT shall have received a copy of the resolutions of the Board of Directors or Executive
Committee of each of the Company and the Guarantors (as the case may be) authorizing the execution, delivery and performance of (i) this Financing Agreement, (ii) the Guaranties, and (iii) any related agreements, in each case certified by the
Secretary, Assistant Secretary or other senior authorized officer of the Company and the Guarantors (as the case may be) as of the date hereof, together with a certificate of the Secretary or Assistant Secretary or other senior authorized officer of
the Company and the Guarantors (as the case may be) as to the incumbency and signature of the officers of the Company and/or the Guarantors executing such Loan Documents and any certificate or other documents to be delivered by them pursuant hereto,
together with evidence of the incumbency of such Secretary or Assistant Secretary or other senior authorized officer. 
  
 (e) Corporate Organization - CIT shall have received (i) a copy of the Certificate of Incorporation of the Company and the
Guarantors certified by the Secretary of State of the state of its incorporation, and (ii) a copy of the By-Laws of the Company certified by the Secretary or Assistant Secretary or other senior authorized officer thereof, all as amended through the
date hereof. 
  

 27 

 (f) Officer’s Certificate - CIT shall have received an executed
Officer’s Certificate of the Company, satisfactory in form and substance to CIT, certifying that (i) the representations and warranties contained herein are true and correct in all material respects on and as of the Closing Date; (ii) the
Company is in compliance with all of the terms and provisions set forth herein; and (iii) no Default or Event of Default has occurred 
  
 (g) Opinions - Counsel for the Company and the Guarantors shall have delivered to CIT opinions satisfactory to CIT opining,
inter alia, that, subject to the (i) filing, priority and remedies provisions of the Uniform Commercial Code, (ii) the provisions of the Bankruptcy Code, insolvency statutes or other like laws, (iii) the equity powers of a court of law and (iv) such
other matters as may be agreed upon with CIT: (x) this Financing Agreement, the Guaranty, the Pledge Agreement and all other Loan Documents of the Company and the Guarantors are (A) valid, binding and enforceable according to their terms, (B) are
duly authorized, executed and delivered, and (C) do not violate any terms, provisions, representations or covenants in the charter or by-laws of the Company or the Guarantors or, to the best knowledge of such counsel, of any loan agreement,
mortgage, deed of trust, note, security or pledge agreement or indenture to which the Company or the Guarantors are signatories or by which the Company or the Guarantors or their assets are bound; and (y) the provisions of all federal and state
securities laws, Bulk Sales Law and the Hart-Scott-Rodino Anti-Trust Improvements Act have been fully complied with or that compliance is not legally required and the reasons supporting such non-compliance. In addition, counsel to the Subordinating
Creditor(s) shall have delivered an opinion satisfactory to CIT that the Subordination Agreement(s) have been duly authorized, executed and delivered and constitute valid and binding agreements enforceable against such Subordinating Creditor(s) in
accordance with the terms thereof. 
  
 (h) Absence of Default - No Default or Event of Default shall have occurred and no material adverse change shall have occurred in the financial condition, business, prospects, profits, operations or assets of the
Company or the Company’s subsidiaries. 
  
 (i) Legal Restraints/Litigation - As of the Closing Date, there shall be no (x) litigation, investigation or proceeding (judicial or administrative) pending or threatened against the Company or the Guarantors or their assets,
by any agency, division or department of any county, city, state or federal government arising out of this Financing Agreement, (y) injunction, writ or restraining order restraining or prohibiting the financing arrangements contemplated under this
Financing Agreement or (z) suit, action, investigation or proceeding (judicial or administrative) pending against the Company or the Guarantors or their assets, which, in the opinion of CIT, if adversely determined, could have a material adverse
effect on the business, operation, assets, financial condition or Collateral of the Company and/or the Guarantors. 
  

 28 

 (j) Guaranties - The Guarantors shall have executed and delivered to CIT
guaranties, in form acceptable to CIT, guaranteeing all present and future Obligations of the Company. 
  
 (k) Subordination Agreement - The Subordinating Creditor shall have executed and delivered to CIT a Subordination
Agreement, in form and substance satisfactory to CIT, subordinating the debt due the Subordinating Creditor by the Company to the prior payment and satisfaction of the Obligations of the Company. 
  
 (l) Cash Budget Projections - CIT shall
have received, reviewed and been satisfied with a twelve (12) month cash budget projection prepared by the Company on the form provided by CIT. 
  
 (m) Pledge Agreement - The Company shall (i) execute and deliver to CIT the Pledge Agreement pledging to CIT as additional
collateral for the Obligations of the Company not less than 100% of the stock each Guarantor and (ii) deliver to CIT the stock certificates evidencing such stock together with duly executed stock powers (undated and in-blank) with respect thereto.

  
 (n) Additional Documents - The
Company shall have executed and delivered to CIT all Loan Documents necessary to consummate the lending arrangement contemplated between the Company and CIT. 
  

(o) Disbursement Authorization - The Company shall have delivered to CIT all information necessary for CIT to issue wire
transfer instructions on behalf of the Company for the initial and subsequent loans and/or advances to be made under this Financing Agreement including, but not limited to, disbursement authorizations in form acceptable to CIT. 
  
 (p) Examination & Verification - CIT shall
have completed, to its satisfaction, an examination and verification of the Accounts, Inventory, books and records of the Company which examination shall indicate that, after giving effect to all Revolving Loans, advances and extensions of credit to
be made at closing, the Company shall have an opening additional Availability of at least $4,500,000.00, as evidenced by a Borrowing Base certificate delivered by the Company to CIT as of the Closing Date, all as more fully required by the
Commitment Letter. It is understood that such requirement contemplates that all debts and obligations are current, and that all payables are being handled in the normal course of the Company’s business and consistent with its past practice.

  
 (q) Depository Accounts - The
Company shall have established a system of lockbox and bank accounts with respect to the collection of Accounts and the deposit of proceeds of Collateral as shall be acceptable to CIT in all respects. Such accounts shall be subject to three party
agreements (between the Company, CIT and the depository bank), which shall be in form and substance satisfactory to CIT. 
  

 29 

 (r) Existing Revolving Credit Agreement - The Company’s existing
credit agreement with Wachovia Bank, National Association (the “Existing Lender”) shall be (x) terminated, (y) all loans and obligations of the Company and/or the Guarantors thereunder shall be paid or satisfied in full, including through
utilization of the proceeds of the initial Revolving Loans and Term Loan to be made under this Financing Agreement (except the Company’s reimbursement obligation with respect to the IRB Letter of Credit) and (z) all liens or security interests
in favor of the Existing Lender on the Collateral and otherwise in connection therewith shall be terminated and/or released upon such payment; provided, however, the IRB Letter of Credit shall remain in place so long as the obligations of the
Company with respect thereto are not secured by any assets of the Company or any subsidiary of the Company. 
  
 (s) Opening Balance Sheet – CIT shall have received an opening balance sheet of the Company as of the Closing
Date which shall be in form and substance satisfactory to CIT. 
  
 (t) Warrants – CIT shall have received documentation satisfactory to it regarding the granting to CIT of warrants to purchase up to two percent (2.0%) of the outstanding shares of voting common
stock of the Company for an amount based on the average of the prior 30 days’ market closing price. The terms and provisions of such warrants (including, without limitation, anti-dilution, registration and put/call rights) shall be mutually
agreed upon between CIT and the Company. 
  
 (u) Additional Collateral for IRB Letter of Credit – UM Holdings, Ltd. shall have provided additional collateral for the IRB Letter of Credit and CIT shall be satisfied with the terms and provisions relating to such
additional collateral. 
  
 (v) Ex-Im Bank
Guarantee – CIT shall have received the Ex-Im Bank Guarantee duly executed by Ex-Im Bank on terms acceptable to CIT and the Company shall have entered into the Borrower Agreement with Ex-Im Bank in accordance with the Ex-Im Bank
Guarantee. 
  
 (w) Schedules - The
Company or its counsel shall provide CIT with schedules of: (a) any of the Company’s and its subsidiaries (i) Trademarks, (ii) Patents, and (iii) Copyrights, as applicable and all in such detail as to provide appropriate recording information
with respect thereto, (b) any tradenames, (c) monthly rental payments for any leased premises or any other premises where any Collateral may be stored or processed, and (d) Permitted Liens, all of the foregoing in form and substance satisfactory to
CIT. 
  
 (x) Commitment Letter -
The Company shall have fully complied, to the reasonable satisfaction of CIT, with all of the terms and conditions of the Commitment Letter. 
  
 Upon the execution of this Financing Agreement and the initial disbursement of loans hereunder, all of the above Conditions Precedent shall have been deemed satisfied
except as otherwise set forth hereinabove or as the Company and CIT shall otherwise agree in writing. 
  

 30 

	 	6.2	Conditions to Each Extension of Credit  

  
 Except to the extent expressly set forth in this Financing Agreement, the agreement of CIT to make any extension of credit requested to be made by it to
the Company on any date (including without limitation, the initial extension of credit) is subject to the satisfaction of the following conditions precedent: 
  

(a) Representations and Warranties - Each of the representations and warranties made by the Company in or pursuant
to this Financing Agreement shall be true and correct in all material respects on and as of such date as if made on and as of such date. 
  
 (b) No Default - No Default or Event of Default shall have occurred and be continuing on such date or after giving
effect to the extension of credit requested to be made on such date. 
  
 (c) Credit Limits/Availability - Except as may be otherwise agreed to from time to time by CIT and the Company in writing, after giving effect to the extension of credit requested to be made by
the Company on such date, none of the limits set forth in Section 3.1 or 5.1 shall have been exceeded and Availability shall not be less than $1,000,000.00. 
  
 Each borrowing by the Company hereunder shall constitute a representation and warranty by the Company as of the date of such loan or advance that each of the
representations, warranties and covenants contained in the Financing Agreement have been satisfied and are true and correct, except as the Company and CIT shall otherwise agree herein or in a separate writing. 
  
 SECTION 7. Revolving Loans 
  
 7.1 CIT agrees, subject to the terms and conditions of this Financing
Agreement, from time to time (but subject to CIT’s right to make Overadvances), to make loans and advances to the Company on a revolving basis (i.e. subject to the limitations set forth herein, the Company may borrow, repay and re-borrow
Revolving Loans) in the following amounts: (a) up to the lesser of (i) $9,000,000 or (ii) the Domestic Borrowing Base less Availability Reserves; and (b) up to the lesser of (i) $5,000,000 or (ii) the Foreign Borrowing Base less Availability
Reserves; provided, however, CIT shall be under no obligation to make any Revolving Loan if Availability is less than $1,000,000 after the making of any such Revolving Loan. All requests for loans and advances must be received by an
officer of CIT no later than (i) 2:00 p.m., New York time, of the Business Day on which any such Chase Bank Rate Loans and advances are required or (ii) three Business Days prior to any requested LIBOR Loan. Should CIT for any reason honor requests
for Overadvances, any such Overadvances shall be made in CIT’s sole discretion and subject to any additional terms CIT deems necessary. 
  
 7.2 In furtherance of the continuing assignment and security interest in the Company’s Accounts and Inventory, the Company will, upon the
creation of Accounts and 
  

 31 

 purchase or acquisition of Inventory, execute and deliver to CIT in such form and manner as CIT may reasonably require,
solely for CIT’s convenience in maintaining records of Collateral, such confirmatory schedules of Accounts and Inventory as CIT may reasonably request, including, without limitation, weekly schedules of Accounts and monthly schedules of
Inventory, all in form and substance satisfactory to CIT, and such other appropriate reports designating, identifying and describing the Accounts and Inventory as CIT may reasonably request, and provided further that CIT may request any such
information more frequently, from time to time, upon its reasonable prior request. In addition, upon CIT’s request, the Company shall provide CIT with copies of agreements with, or purchase orders from, the Company’s customers, and copies
of invoices to customers, proof of shipment or delivery, access to its computers, electronic media and software programs associated therewith (including any electronic records, contracts and signatures) and such other documentation and information
relating to said Accounts and other Collateral as CIT may reasonably require. Failure to provide CIT with any of the foregoing shall in no way affect, diminish, modify or otherwise limit the security interests granted herein. The Company hereby
authorizes CIT to regard the Company’s printed name or rubber stamp signature on assignment schedules or invoices as the equivalent of a manual signature by one of the Company’s authorized officers or agents. 
  
 7.3 The Company hereby represents and warrants that: each Trade
Account Receivable is based on an actual and bona fide sale and delivery of Inventory or rendition of services to customers, made by the Company in the ordinary course of its business; the Inventory being sold, and the Trade Accounts Receivable
created, are the exclusive property of the Company and are not and shall not be subject to any lien, consignment arrangement, encumbrance, security interest or financing statement whatsoever, other than the Permitted Encumbrances; the invoices
evidencing such Trade Accounts Receivable are in the name of the Company; and the customers of the Company have accepted the Inventory or services, owe and are obligated to pay the full amounts stated in the invoices according to their terms,
without dispute, offset, defense, counterclaim or contra, except for disputes and other matters arising in the ordinary course of business with respect to which the Company has complied with the notification requirements of Paragraph 3.5 of this
Section 3. The Company confirms to CIT that any and all Taxes or fees relating to its business, its sales, the Accounts or Inventory relating thereto, are its sole responsibility and that same will be paid by the Company when due, subject to
Paragraph 7.6 of Section 7 of this Financing Agreement, and that none of said Taxes or fees represent a lien on or claim against the Accounts. The Company hereby further represents and warrants that it shall not acquire any Inventory on a
consignment basis, nor co-mingle its Inventory with any of its customers or any other person, including pursuant to any bill and hold sale or otherwise, and that its Inventory is marketable to its customers in the ordinary course of business of the
Company, except as it may otherwise report in writing to CIT pursuant to Paragraph 3.5 hereof from time to time. The Company also warrants and represents that it is a duly and validly existing corporation and is qualified in all states where the
failure to so qualify would have an adverse effect on the business of the Company or the ability of the Company to enforce collection of Accounts due from customers residing in that state. The Company agrees to maintain such books and records
regarding Accounts and Inventory as CIT may reasonably require and agrees that the books and records of the Company will reflect CIT’s interest in the Accounts and Inventory. All of the books and records of the Company will be available to CIT
at normal business hours, including any records handled or maintained for the Company by any other company or entity. 
  

 32 

 7.4 (a) Until CIT has advised the Company to the contrary after the occurrence of an Event of
Default, the Company, at its expense, will enforce, collect and receive all amounts owing on the Accounts in the ordinary course of its business and any proceeds it so receives shall be subject to the terms hereof, and held on behalf of and in trust
for CIT. Such privilege shall terminate at the election of CIT, upon the occurrence of an Event of Default. Any checks, cash, credit card sales and receipts, notes or other instruments or property received by the Company with respect to any
Collateral, including Accounts, shall be held by the Company in trust for CIT, separate from the Company’s own property and funds, and promptly turned over to CIT with proper assignments or endorsements by deposit to the Depository Accounts.
The Company shall: (i) indicate on all of its invoices that funds should be delivered to and deposited in a Depository Account; (ii) direct all of its account debtors to deposit any and all proceeds of Collateral into the Depository Accounts; (iii)
irrevocably authorize and direct any banks which maintain the Company’s initial receipt of cash, checks and other items to promptly wire transfer all available funds to a Depository Account; and (iv) advise all such banks of CIT’s security
interest in such funds. The Company shall provide CIT with prior written notice of any and all deposit accounts opened or to be opened subsequent to the Closing Date. Subject to Collection Days, all amounts received by CIT in payment of Accounts
will be credited to the Revolving Loan Account when CIT is advised by its bank of its receipt of “collected funds” at CIT’s bank account in New York, New York on the Business Day of such advise if advised no later than 1:00 p.m. EST
or on the next succeeding Business Day if so advised after 1:00 PM EST. No checks, drafts or other instrument received by CIT shall constitute final payment to CIT unless and until such instruments have actually been collected. 
  
 (b) The Company shall establish and maintain, in its name and at its
expense, deposit accounts with such banks as are acceptable to CIT (the “Blocked Accounts”) into which the Company shall promptly cause to be deposited: (i) all proceeds of Collateral received by the Company, including all amounts payable
to the Company from credit card issuers and credit card processors, and (ii) all amounts on deposit in deposit accounts used by the Company at each of its locations, all as further provided in Paragraph 3.4(a) above. The banks at which the Blocked
Accounts are established shall enter into an agreement, in form and substance satisfactory to CIT (the “Blocked Account Agreements”), providing that all cash, checks and items received or deposited in the Blocked Accounts are the property
of CIT, that the depository bank has no lien upon, or right of set off against, the Blocked Accounts and any cash, checks, items, wires or other funds from time to time on deposit therein, except as otherwise provided in the Blocked Account
Agreements, and that automatically, on a daily basis the depository bank will wire, or otherwise transfer, in immediately available funds, all funds received or deposited into the Blocked Accounts to such bank account as CIT may from time to time
designate for such purpose. The Company hereby confirms and agrees that all amounts deposited in such Blocked Accounts and any other funds received and collected by CIT, whether as proceeds of Inventory or other Collateral or otherwise, shall be the
property of CIT. 
  
 7.5 The Company agrees to notify CIT:
(a) of any matters affecting more than $100,000 of the value, enforceability or collectibility of any Account and of all customer 
  

 33 

 disputes, offsets, defenses, counterclaims, returns, rejections and all reclaimed or repossessed merchandise or goods (in
each case in excess of $100,000), and of any adverse effect in more than $100,000 of the value of its Inventory, in its weekly and monthly collateral reports (as applicable) provided to CIT hereunder, in such detail and format as CIT may reasonably
require from time to time and (b) promptly of any such matters which are material, as a whole, to the Accounts and/or the Inventory. The Company agrees to issue credit memoranda promptly (with duplicates to CIT upon request after the occurrence of
an Event of Default) upon accepting returns or granting allowances. Upon the occurrence of an Event of Default (which is not waived in writing by CIT) and on notice from CIT, the Company agrees that all returned, reclaimed or repossessed merchandise
or goods shall be set aside by the Company, marked with CIT’s name (as secured party) and held by the Company for CIT’s account. 
  
 7.6 CIT shall maintain a Revolving Loan Account on its books in which the Company will be charged with all loans and advances made by CIT to it or
for its account, and with any other Obligations, including any and all costs, expenses and reasonable attorney’s fees which CIT may incur in connection with the exercise by or for CIT of any of the rights or powers herein conferred upon CIT, or
in the prosecution or defense of any action or proceeding to enforce or protect any rights of CIT in connection with this Financing Agreement, the other Loan Documents or the Collateral assigned hereunder, or any Obligations owing by the Company.
The Company will be credited with all amounts received by CIT from the Company or from others for the Company’s account, including, as above set forth, all amounts received by CIT in payment of Accounts, and such amounts will be applied to
payment of the Obligations as set forth herein. In no event shall prior recourse to any Accounts or other security granted to or by the Company be a prerequisite to CIT’s right to demand payment of any Obligation. Further, it is understood that
CIT shall have no obligation whatsoever to perform in any respect any of the Company’s contracts or obligations relating to the Accounts. 
  
 7.7 After the end of each month, CIT shall promptly send the Company a statement showing the accounting for the charges, loans, advances and other
transactions occurring between CIT and the Company during that month. The monthly statements shall be deemed correct and binding upon the Company and shall constitute an account stated between the Company and CIT unless CIT receives a written
statement of the exceptions within thirty (30) days of the date of the monthly statement. 
  
 7.8 In the event that (a) the sum of (i) the outstanding balance of Revolving Loans and (ii) outstanding balance of Letters of Credit exceeds (b) the lesser of (x) the Borrowing Base less $1,000,000.00 or (y)
the Revolving Line of Credit, any such nonconsensual Overadvance shall be due and payable to CIT immediately upon CIT’s demand therefor. 
  
 SECTION 8. Term Loan  
  
 TERM LOAN 
  
 8.1 The Company hereby agrees to execute and deliver to CIT the Term Loan Promissory Note, in the form of Exhibit A attached hereto, to evidence
the Term Loan to be extended by CIT. 
  

 34 

 8.2 Upon receipt of such Term Loan Promissory Note on the Second Amendment Effective Date, CIT
hereby agrees to extend to the Company the Term Loan in the principal amount of $4,000,000.00 
  
 8.3 The principal amount of the Term Loan shall be repaid to CIT by the Company by: (i) eleven (11) equal quarterly principal installments of $250,000.00 each, followed by (ii) one (1) installment of
$1,250,000.00, whereof the first installment shall be due and payable on September 30, 2004 and the subsequent installments shall be due and payable on the last day of each calendar quarter thereafter until paid in full. 
  
 ADDITIONAL PROVISIONS FOR TERM LOAN 
  
 8.4 In the event this Financing Agreement or the Line of Credit is
terminated by either CIT or the Company for any reason whatsoever, the Term Loan shall become due and payable on the effective date of such termination notwithstanding any provision to the contrary in the Promissory Note or this Financing Agreement.

  
 8.5 The Company may prepay at any time, at its option,
in whole or in part, the Term Loan, provided that on each such prepayment, the Company shall pay accrued interest on the principal so prepaid to the date of such prepayment. 
  
 8.6 In the event the Company has Surplus Cash in any Fiscal Year beginning with the Fiscal Year ending December 31,
2003, the Company must make a Mandatory Prepayment of the Term Loan within ninety (90) days of the end of any such Fiscal Year by an amount equal to twenty-five (25%) of said Surplus Cash. 
  
 8.7 Each prepayment (whether voluntary or mandatory) shall be applied
to the then last maturing installments of principal of the Term Loan. 
  
 8.8 The Company hereby authorizes CIT to charge its Revolving Loan Account with the amount of all amounts due under this Section 4 as such amounts become due. The Company confirms that any charges which CIT may so make to its
Revolving Loan Account as herein provided will be made as an accommodation to the Company and solely at CIT’s discretion. 
  
 SECTION 9. Letters of Credit 
  
 In order to assist the Company in establishing or opening Letters of Credit with an Issuing Bank, the Company has requested CIT to join in the
applications for such Letters of Credit, and/or guarantee payment or performance of such Letters of Credit and any drafts or acceptances thereunder through the issuance of the Letters of Credit Guaranty, thereby lending CIT’s credit to the
Company and CIT has agreed to do so. These arrangements shall be handled by CIT subject to the terms and conditions set forth below. 
  
 9.1 CIT shall assist the Company in obtaining standby Letter(s) of Credit in an amount not to exceed the outstanding amount of the Standby Letter
of Credit Sub-Line and CIT 
  

 35 

 shall assist the Company in obtaining documentary Letter(s) of Credit in an amount not to exceed the outstanding amount
of the Documentary Letter of Credit Sub-Line; provided, however, CIT shall be under no obligation to assist the Company in obtaining any Letter of Credit if Availability is less than $1,000,000 after the obtaining of any such Letter of
Credit. CIT’s assistance for amounts in excess of the limitation set forth herein shall at all times and in all respects be in CIT’s sole discretion. It is understood that the term, form and purpose of each Letter of Credit and all
documentation in connection therewith, and any amendments, modifications or extensions thereof, must be mutually acceptable to CIT, the Issuing Bank and the Company, provided that Letters of Credit shall not be used for the purchase of domestic
Inventory or to secure present or future debt of domestic Inventory suppliers. Any and all outstanding Letters of Credit shall be reserved dollar for dollar from Availability as an Availability Reserve. 
  
 9.2 CIT shall have the right, without notice to the Company, to charge
the Company’s Revolving Loan Account with the amount of any and all indebtedness, liability or obligation of any kind incurred by CIT under the Letters of Credit Guaranty at the earlier of (a) payment by CIT under the Letters of Credit
Guaranty, or (b) the occurrence of an Event of Default. Any amount charged to Company’s Revolving Loan Account shall be deemed a Revolving Loan hereunder and shall incur interest at the rate provided in Paragraph 8.1 of Section 8 of this
Financing Agreement. 
  
 9.3 The Company unconditionally
indemnifies CIT and holds CIT harmless from any and all loss, claim or liability incurred by CIT arising from any transactions or occurrences relating to Letters of Credit established or opened for the Company’s account, the collateral relating
thereto and any drafts or acceptances thereunder, and all Obligations thereunder, including any such loss or claim due to any errors, omissions, negligence, misconduct or action taken by any Issuing Bank, other than for any such loss, claim or
liability arising out of the gross negligence or willful misconduct by CIT under the Letters of Credit Guaranty. This indemnity shall survive termination of this Financing Agreement. The Company agrees that any charges incurred by CIT for the
Company account by the Issuing Bank shall be conclusive on CIT and may be charged to the Company’s Revolving Loan Account. 
  
 9.4 CIT shall not be responsible for: the existence, character, quality, quantity, condition, packing, value or delivery of the goods purporting to
be represented by any documents; any difference or variation in the character, quality, quantity, condition, packing, value or delivery of the goods from that expressed in the documents; the validity, sufficiency or genuineness of any documents or
of any endorsements thereon, even if such documents should in fact prove to be in any or all respects invalid, insufficient, fraudulent or forged; the time, place, manner or order in which shipment is made; partial or incomplete shipment, or failure
or omission to ship any or all of the goods referred to in the Letters of Credit or documents; any deviation from instructions; delay, default, or fraud by the shipper and/or anyone else in connection with the goods or the shipping thereof; or any
breach of contract between the shipper or vendors and the Company. 
  
 9.5 The Company agrees that any action taken by CIT, if taken in good faith, or any action taken by any Issuing Bank, under or in connection with the Letters of Credit, the 
  

 36 

 guarantees, the drafts or acceptances, or the Collateral, shall be binding on the Company and shall not put CIT in any
resulting liability to the Company. In furtherance thereof, CIT shall have the full right and authority to clear and resolve any questions of non-compliance of documents; to give any instructions as to acceptance or rejection of any documents or
goods; to execute any and all steamship or airways guaranties (and applications therefore), indemnities or delivery orders; to grant any extensions of the maturity of, time of payment for, or time of presentation of, any drafts, acceptances, or
documents; and to agree to any amendments, renewals, extensions, modifications, changes or cancellations of any of the terms or conditions of any of the applications, Letters of Credit, drafts or acceptances; all in CIT’s sole name, and the
Issuing Bank shall be entitled to comply with and honor any and all such documents or instruments executed by or received solely from CIT, all without any notice to or any consent from the Company. Notwithstanding any prior course of conduct or
dealing with respect to the foregoing including amendments and non-compliance with documents and/or the Company’s instructions with respect thereto, CIT may exercise its rights hereunder in its sole and reasonable business judgement. In
addition, without CIT’s express consent and endorsement in writing, the Company agrees: (a) not to execute any and all applications for steamship or airway guaranties, indemnities or delivery orders; to grant any extensions of the maturity of,
time of payment for, or time of presentation of, any drafts, acceptances or documents; or to agree to any amendments, renewals, extensions, modifications, changes or cancellations of any of the terms or conditions of any of the applications, Letters
of Credit, drafts or acceptances; and (b) after the occurrence of an Event of Default which is not cured within any applicable grace period, if any, or waived by CIT, not to (i) clear and resolve any questions of non-compliance of documents, or (ii)
give any instructions as to acceptances or rejection of any documents or goods. 
  
 9.6 The Company agrees that any necessary import, export or other licenses or certificates for the import or handling of the Collateral will have been promptly procured; all foreign and domestic governmental
laws and regulations in regard to the shipment and importation of the Collateral, or the financing thereof will have been promptly and fully complied with; and any certificates in that regard that CIT may at any time request will be promptly
furnished. In this connection, the Company warrants and represents that all shipments made under any such Letters of Credit are in accordance with the laws and regulations of the countries in which the shipments originate and terminate, and are not
prohibited by any such laws and regulations. The Company assumes all risk, liability and responsibility for, and agrees to pay and discharge, all present and future local, state, federal or foreign Taxes, duties, or levies. Any embargo, restriction,
laws, customs or regulations of any country, state, city, or other political subdivision, where the Collateral is or may be located, or wherein payments are to be made, or wherein drafts may be drawn, negotiated, accepted, or paid, shall be solely
the Company’s risk, liability and responsibility. 
  
 9.7
Upon any payments made to the Issuing Bank under the Letter of Credit Guaranty, CIT shall acquire by subrogation, any rights, remedies, duties or obligations granted or undertaken by the Company to the Issuing Bank in any application for Letters
of Credit, any standing agreement relating to Letters of Credit or otherwise, all of which shall be deemed to have been granted to CIT and apply in all respects to CIT and shall be in addition to any rights, remedies, duties or obligations contained
herein. 
  

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 SECTION 10. Collateral 
  
 10.1 As security for the prompt payment in full of all Obligations, the Company hereby pledges and grants to CIT a
continuing general lien upon, and security interest in, all of its assets including, without limitation, all of its: 
  
 (a) Accounts; 
  
 (b) Inventory; 
  
 (c) General Intangibles; 
  
 (d) Documents of Title; 
  
 (e) Other Collateral; and 
  
 (f) Investment Property. 
  

	 	10.2	The security interests granted hereunder shall extend and attach to: 

  

(a) All Collateral which is presently in existence and which is owned by the Company or in which the Company has any interest,
whether held by the Company or others for its account; and 
  
 (b) All Inventory and any portion thereof which may be returned, rejected, reclaimed or repossessed by either CIT or the Company from the Company’s customers, as well as to all supplies, goods,
incidentals, packaging materials, labels and any other items which contribute to the finished goods or products manufactured or processed by the Company, or to the sale, promotion or shipment thereof. 
  
 10.3 The Company agrees to safeguard, protect and hold all Inventory
for CIT’s account and make no disposition thereof except in the ordinary course of its business of the Company, as herein provided. The Company represents and warrants that Inventory will be sold and shipped by the Company to its customers only
in the ordinary course of the Company’s business, and then only on open account and on terms currently being extended by the Company to its customers, provided that, absent the prior written consent of CIT, the Company shall not sell Inventory
on a consignment basis nor retain any lien or security interest in any sold Inventory. Upon the sale, exchange, or other disposition of Inventory, as herein provided, the security interest in the Inventory provided for herein shall, without break in
continuity and without further formality or act, continue in, and attach to, all proceeds, including any instruments for the payment of money, Trade Accounts Receivable, documents of title, shipping documents, chattel paper and all other cash and
non-cash proceeds of such sale, exchange or disposition. As to any such sale, exchange or other disposition, CIT shall have all of the rights of an unpaid seller, including stoppage in transit, replevin, rescission and reclamation. The Company
hereby agrees to immediately forward any and all proceeds of Collateral to the Deposit Account, and to hold any such proceeds (including any notes and instruments), in trust for CIT 
  

 38 

 pending delivery to CIT. Irrespective of CIT’s perfection status in any and all of the General Intangibles,
including, without limitations, any Trademarks, Copyrights or licenses with respect thereto, the Company hereby irrevocably grants CIT a royalty free license to sell, or otherwise dispose or transfer, in accordance with Paragraph 10.3 of Section 10
of this Financing Agreement, and the applicable terms hereof, of any of the Inventory upon the occurrence of an Event of Default which has not been waived in writing by CIT. 
  
 10.4 The Company agrees at its own cost and expense to keep the Equipment in as good and substantial repair and
condition as the same is now, reasonable wear and tear excepted, making any and all repairs and replacements when and where necessary. The Company also agrees to safeguard, protect and hold all Equipment in accordance with the terms hereof. Absent
CIT’s prior written consent, any sale, exchange or other disposition of any Equipment shall be made by the Company in the ordinary course of business and as set forth herein. The Company may, in the ordinary course of its business, sell,
exchange or otherwise dispose of obsolete or surplus Equipment; provided, however, that the then value of the Equipment so disposed of in any Fiscal Year does not exceed $250,000.00 in the aggregate; provided, further, that the aforesaid right shall
automatically cease upon the occurrence of a Default or an Event of Default which is not waived in writing by CIT. 
  
 10.5 The rights and security interests granted to CIT hereunder are to continue in full force and effect, notwithstanding the termination of this
Financing Agreement or the fact that the Revolving Loan Account may from time to time be temporarily in a credit position, until the final payment in full to CIT of all Obligations and the termination of this Financing Agreement. Any delay, or
omission by CIT to exercise any right hereunder shall not be deemed a waiver thereof, or be deemed a waiver of any other right, unless such waiver shall be in writing and signed by CIT. A waiver on any one occasion shall not be construed as a bar
to, or waiver of, any right or remedy on any future occasion. 
  
 10.6 Notwithstanding CIT’s security interest in the Collateral and to the extent that the Obligations are now or hereafter secured by any assets or property other than the Collateral or by the guarantee, endorsement, assets or
property of any other person, CIT shall have the right in its sole discretion to determine which rights, liens, security interests or remedies CIT shall at any time pursue, foreclose upon, relinquish, subordinate, modify or take any other action
with respect to, without in any way modifying or affecting any of them, or any of CIT’s rights hereunder. 
  
 10.7 Any balances to the credit of the Company and any other property or assets of the Company in the possession or control of CIT may be held by
CIT as security for any Obligations and applied in whole or partial satisfaction of such Obligations when due. The liens and security interests granted herein, and any other lien or security interest CIT may have in any other assets of the Company,
shall secure payment and performance of all now existing and future Obligations. CIT may in its discretion charge any or all of the Obligations to the Revolving Loan Account when due. 
  
 10.8 The Company possesses all General Intangibles and rights thereto necessary to conduct its business as conducted
as of the Closing Date and the Company shall maintain its rights in, and the value of, the foregoing in the ordinary course of its business, including, without 
  

 39 

 limitation, by making timely payment with respect to any applicable licensed rights. The Company shall deliver to CIT,
and/or shall cause the appropriate party to deliver to CIT, from time to time such pledge or security agreements with respect to General Intangibles (now or hereafter acquired) of the Company and its subsidiaries as CIT shall require to obtain valid
first liens thereon. In furtherance of the foregoing, the Company shall provide timely notice to CIT of any additional Patents, Trademarks, tradenames, service marks, Copyrights, brand names, trade names, logos and other trade designations acquired
or applied for subsequent to the Closing Date and the Company shall execute such documentation as CIT may reasonably require to obtain and perfect its lien thereon. The Company hereby confirms that it shall deliver, or cause to be delivered, any
pledged stock issued subsequent to the Closing Date to CIT in accordance with the applicable terms of the Pledge Agreement and prior to such delivery, shall hold any such stock in trust for CIT. The Company hereby irrevocably grants to CIT a
royalty-free, non-exclusive license in the General Intangibles, including tradenames, Trademarks, Copyrights, Patents, licenses, and any other proprietary and intellectual property rights and any and all right, title and interest in any of the
foregoing, for the sole purpose, upon the occurrence of an Event of Default, of the right to: (i) advertise for sale and sell or transfer any Inventory bearing any of the General Intangibles, and (ii) make, assemble, prepare for sale or complete, or
cause others to do so, any applicable raw materials or Inventory bearing any of the General Intangibles, including use of the Equipment and Real Estate for the purpose of completing the manufacture of unfinished goods, raw materials or
work-in-process comprising Inventory, and apply the proceeds thereof to the Obligations hereunder, all as further set forth in this Financing Agreement and irrespective of CIT’s lien and perfection in any General Intangibles. 
  
 SECTION 11. Representations, Warranties and Covenants

  
 11.1 The Company hereby warrants, represents and
covenants that: (a) the fair value of the Total Assets exceeds the book value of the Total Liabilities; (b) the Company is generally able to pay its debts as they become due and payable; and (c) the Company does not have unreasonably small capital
to carry on its business as it is currently conducted absent extraordinary and unforeseen circumstances. The Company further warrants and represents that: (i) Schedule 1 hereto correctly and completely sets forth the Company’s (A) chief
executive office, (B) Collateral locations, (C) tradenames, and (D) all the other information listed on said Schedule; (ii) except for the Permitted Encumbrances, after filing of financing statements in the applicable filing clerks office at the
locations set forth in Schedule 1, this Financing Agreement creates a valid, perfected and first priority security interest in the Collateral and the security interests granted herein constitute and shall at all times constitute the first and only
liens on the Collateral; (iii), except for the Permitted Encumbrances, the Company is, or will be, at the time additional Collateral is acquired by it, the absolute owner of the Collateral with full right to pledge, sell, consign, transfer and
create a security interest therein, free and clear of any and all claims or liens in favor of others; (iv) the Company will, at its expense, forever warrant and, at CIT’s request, defend the same from any and all claims and demands of any other
person other than a holder of a Permitted Encumbrance; (v) the Company will not grant, create or permit to exist, any lien upon, or security interest in, the Collateral, or any proceeds thereof, in favor of any other person other than the holders of
the Permitted Encumbrances; (vi) that the Equipment does not comprise a part of the Inventory of the Company and (iv) the Equipment is and will only be used by the Company in its business and will not be held for sale or lease, or removed from its
premises, or otherwise disposed of by the Company except as otherwise permitted in this Financing Agreement. 
  

 40 

 11.2 The Company agrees to maintain books and records pertaining to the Collateral in accordance
with GAAP and in such additional detail, form and scope as CIT shall reasonably require. The Company agrees that CIT or its agents may enter upon the Company’s premises at any time during normal business hours, and from time to time in its
reasonable business judgment, for the purpose of inspecting the Collateral and any and all records pertaining thereto. The Company agrees to afford CIT thirty (30) days prior written notice of any change in the location of any Collateral, other than
to locations, that as of the Closing Date, are known to CIT and at which CIT has filed financing statements and otherwise fully perfected its liens thereon. The Company is also to advise CIT promptly, in sufficient detail, of any material adverse
change relating to the type, quantity or quality of the Collateral or on the security interests granted to CIT therein. 
  
 11.3 The Company agrees to: (a) execute and deliver to CIT, from time to time, solely for CIT’s convenience in maintaining a record of the
Collateral, such written statements, and schedules as CIT may reasonably require, designating, identifying or describing the Collateral; and (b) provide CIT, on request, with an appraisal of the Inventory which appraisal shall be at the
Company’s expense and otherwise acceptable to CIT. The Company’s failure, however, to promptly give CIT such statements, or schedules shall not affect, diminish, modify or otherwise limit CIT’s security interests in the Collateral.

  
 11.4 The Company agrees to comply with the requirements
of all state and federal laws in order to grant to CIT valid and perfected first security interests in the Collateral, subject only to the Permitted Encumbrances. CIT is hereby authorized by the Company to file (including pursuant to the applicable
terms of the UCC) from time to time any financing statements, continuations or amendments covering the Collateral whether or not the Company’s signature appears thereon. The Company hereby consents to and ratifies any and all execution and/or
filing of financing statements on or prior to the Closing Date by CIT. The Company agrees to do whatever CIT may reasonably request, from time to time, by way of: filing notices of liens, financing statements, amendments, renewals and continuations
thereof; cooperating with CIT’s agents and employees; keeping Collateral records; transferring proceeds of Collateral to CIT’s possession; and performing such further acts as CIT may reasonably require in order to effect the purposes of
this Financing Agreement. 
  
 11.5 (a) The Company agrees
to maintain insurance on all of its property under such policies of insurance, with such insurance companies, in such reasonable amounts and covering such insurable risks as are at all times reasonably satisfactory to CIT. All policies covering the
Inventory are, subject to the rights of any holders of Permitted Encumbrances holding claims senior to CIT, to be made payable to CIT, in case of loss, under a standard non-contributory “mortgagee”, “lender” or “secured
party” clause and are to contain such other provisions as CIT may require to fully protect CIT’s interest in the Inventory and to any payments to be made under such policies. All original policies or true copies thereof are to be delivered
to CIT, premium prepaid, with the loss payable endorsement in CIT’s favor, and shall provide for not less than thirty (30) days prior 
  

 41 

 written notice to CIT of the exercise of any right of cancellation. At the Company’s request, or if
the Company fails to maintain such insurance, CIT may arrange for such insurance, but at the Company’s expense and without any responsibility on CIT’s part for: obtaining the insurance, the solvency of the insurance companies, the adequacy
of the coverage, or the collection of claims. Upon the occurrence of an Event of Default which is not waived in writing by CIT, CIT shall, subject to the rights of any holders of Permitted Encumbrances holding claims senior to CIT, have the sole
right, in the name of CIT or the Company, to file claims under any insurance policies, to receive, receipt and give acquittance for any payments that may be payable thereunder, and to execute any and all endorsements, receipts, releases,
assignments, reassignments or other documents that may be necessary to effect the collection, compromise or settlement of any claims under any such insurance policies. 
  
 (b) In the event of any loss or damage by fire or other casualty, insurance proceeds relating to
Inventory shall first reduce the Company’s Revolving Loan, then the Term Loan; 
  
 (c) In the event the Company fails to provide CIT with timely evidence, acceptable to CIT, of its maintenance of insurance coverage
required pursuant to paragraph 7.5(a) above, CIT may purchase, at the Company’s expense, insurance to protect CIT’s interests in the Collateral. The insurance acquired by CIT may, but need not, protect the Company’s interest in the
Collateral, and therefore such insurance may not pay claims which the Company may have with respect to the Collateral or pay any claim which may be made against the Company in connection with the Collateral. In the event CIT purchases, obtains or
acquires insurance covering all or any portion of the Collateral, the Company shall be responsible for all of the applicable costs of such insurance, including premiums, interest (at the applicable Chase Bank Rate for Revolving Loans set forth in
paragraph 8.1 of Section 8 hereof), fees and any other charges with respect thereto, until the effective date of the cancellation or the expiration of such insurance. CIT may charge all of such premiums, fees, costs, interest and other charges to
the Company’s Revolving Loan Account. The Company hereby acknowledges that the costs of the premiums of any insurance acquired by CIT may exceed the costs of insurance which the Company may be able to purchase on its own. In the event that CIT
purchases such insurance, CIT will notify the Company of said purchase within thirty (30) days of the date of such purchase. If, within thirty (30) days of the date of such notice, the Company provides CIT with proof that the Company had the
insurance coverage required pursuant to 7.5(a) above (in form and substance satisfactory to CIT) as of the date on which CIT purchased insurance and the Company continued at all times to have such insurance, then CIT agrees to cancel the insurance
purchased by CIT and credit the Company’s Revolving Loan Account with the amount of all costs, interest and other charges associated with any insurance purchased by CIT, including with any amounts previously charged to the Revolving Loan
Account. 
  
 11.6 The Company agrees to pay, when due, all
Taxes, including sales taxes, assessments, claims and other charges lawfully levied or assessed upon the Company or the Collateral unless such Taxes are being diligently contested in good faith by the Company by appropriate proceedings and adequate
reserves are established in accordance with GAAP. 
  

 42 

 Notwithstanding the foregoing, if any lien shall be filed or claimed thereunder (x) for Taxes due the United States of
America or (y) which in CIT’s opinion might create a valid obligation having priority over the rights granted to CIT herein, such lien shall not be deemed to be a Permitted Encumbrance hereunder and the Company shall immediately pay such tax
and remove the lien of record. If the Company fails to do so promptly, then at CIT’s election, CIT may (i) create an Availability Reserve in such amount as it may deem appropriate in its business judgement, or (ii) upon the occurrence of a
Default or Event of Default, imminent risk of seizure, filing of any priority lien, forfeiture, or sale of the Collateral, pay Taxes on the Company’s behalf, and the amount thereof shall be an Obligation secured hereby and due on demand.

  
 11.7 The Company: (a) agrees to comply with all acts,
rules, regulations and orders of any legislative, administrative or judicial body or official, which the failure to comply with would have a material and adverse impact on the Collateral, or any material part thereof, or on the business or
operations of the Company, provided that the Company may contest any acts, rules, regulations, orders and directions of such bodies or officials in any reasonable manner which will not, in CIT’s reasonable opinion, materially and adversely
effect CIT’s rights or priority in the Collateral; (b) agrees to comply with all environmental statutes, acts, rules, regulations or orders as presently existing or as adopted or amended in the future, applicable to the Collateral, the
ownership and/or use of its real property and operation of its business, which the failure to comply with would have a material and adverse impact on the Collateral, or any material part thereof, or on the operation of the business of the Company;
and (c) shall not be deemed to have breached any provision of this Paragraph 7.7 if (i) the failure to comply with the requirements of this Paragraph 7.7 resulted from good faith error or innocent omission, (ii) the Company promptly commences and
diligently pursues a cure of such breach, and (iii) such failure is cured within (30) days following the Company’s receipt of notice of such failure, or if such cannot in good faith be cured within thirty (30) days, then such breach is cured
within a reasonable time frame based upon the extent and nature of the breach and the necessary remediation, and in conformity with any applicable consent order, consensual agreement and applicable law. 
  
 11.8 Until termination of this Financing Agreement and payment and
satisfaction of all Obligations due hereunder, the Company agrees that, unless CIT shall have otherwise consented in writing, the Company will furnish to CIT: (a) within one hundred five (105) days after the end of each Fiscal Year of the Company,
an audited Consolidated Balance Sheet, with an unaudited Consolidating Balance Sheet attached thereto, as at the close of such year, and statements of profit and loss, cash flow and reconciliation of surplus of the Company and its consolidated
subsidiaries for such year, audited (with respect to consolidated financial statements only) by independent public accountants selected by the Company and satisfactory to CIT; (b) within sixty (60) days after the end of each Fiscal Quarter (i) a
Consolidated Balance Sheet and Consolidating Balance Sheet as at the end of such period and statements of profit and loss and statements of cash flow of the Company and its consolidated subsidiaries, certified by an authorized financial or
accounting officer of the Company and (ii) a detailed report setting forth the amount of all Support Obligations, the amount of all Support Obligations entered into during such Fiscal Quarter and the amount of all payments made under Support
Obligations during such Fiscal Quarter; (c) within thirty (30) days after the end of each month a Consolidated Balance Sheet as at the end of such period and statements of profit and loss and statements of cash flow 
  

 43 

 of the Company and all subsidiaries for such period, certified by an authorized financial or accounting officer of the
Company; and (d) from time to time, such further information regarding the business affairs and financial condition of the Company and its consolidated subsidiaries as CIT may reasonably request, including, without limitation (i) the
accountant’s management practice letter and (ii) annual cash flow projections in form satisfactory to CIT. Each financial statement which the Company is required to submit hereunder must be accompanied by an officer’s certificate, signed
by the President, Vice President, Controller, or Treasurer, pursuant to which any one such officer must certify that: (x) the financial statement(s) fairly and accurately represent(s) the Company’s financial condition at the end of the
particular accounting period, as well as the Company’s operating results during such accounting period, subject to year-end audit adjustments; and (y) during the particular accounting period: (A) there has been no Default or Event of Default
under this Financing Agreement, provided, however, that if any such officer has knowledge that any such Default or Event of Default, has occurred during such period, the existence of and a detailed description of same shall be set forth in
such officer’s certificate; (B) the Company has not received any notice of cancellation with respect to its property insurance policies; (C) the Company has not received any notice that could result in a material adverse effect on the value of
the Collateral taken as a whole; and (D) the exhibits attached to such financial statement(s) constitute detailed calculations showing compliance with all financial covenants contained in this Financing Agreement. 
  
 11.9 Until termination of the Financing Agreement and payment and
satisfaction of all Obligations due hereunder, the Company agrees that, without the prior written consent of CIT, except as otherwise herein provided, the Company will not: 
  

	 	(a)	Mortgage, assign, pledge, transfer or otherwise permit any lien, charge, security interest, encumbrance or judgment, (whether as a result of a purchase money or title retention
transaction, or other security interest, or otherwise) to exist on any of the Company’s Collateral or any other assets, whether now owned or hereafter acquired, except for the Permitted Encumbrances; 

  

	 	(b)	Incur or create any Indebtedness other than the Permitted Indebtedness; 

  

	 	(c)	Sell, lease, assign, transfer or otherwise dispose of (i) Collateral, except as otherwise specifically permitted by this Financing Agreement, or (ii) either all or substantially all
of the Company’s assets, which do not constitute Collateral; 

  

	 	(d)	Merge, consolidate or otherwise alter or modify its corporate name, principal place of business, structure, or existence, re-incorporate or re-organize, or enter into or engage in
any operation or activity materially different from that presently being conducted by the Company, or purchase or acquire all or substantially all of the capital stock or assets of any corporation or entity, except that the Company may change its
corporate name or address, provided that (i) the Company shall give CIT thirty (30) days prior written notice thereof and (ii) the Company shall execute and deliver, prior to or simultaneously with any such action, any and all documents and
agreements requested by CIT to confirm the continuation and preservation of all security interests and liens granted to CIT hereunder; 

  

	 	(e)	(i) Amend, modify or otherwise change (or permit the amendment, modification or other change in any manner of) any of the provisions of any of its or its 

 

 44 

 subsidiaries’ Indebtedness or of any instrument or agreement (including, without limitation, any
purchase agreement, indenture, loan agreement or security agreement) relating to any such Indebtedness if such amendment, modification or change would shorten the final maturity or average life to maturity of, or require any payment to be made
earlier than the date originally scheduled on, such Indebtedness, would increase the interest rate applicable to such Indebtedness, would increase the amounts of any principal payments applicable to such Indebtedness, would change the subordination
provision, if any, of such Indebtedness, or would otherwise be adverse to CIT or the issuer of such Indebtedness in any respect, or (ii) except for the Obligations, make any voluntary or optional payment, prepayment, redemption, defeasance, sinking
fund payment or other acquisition for value of any of its or its subsidiaries’ Indebtedness (including, without limitation, by way of depositing money or securities with the trustee therefor before the date required for the purpose of paying
any portion of such Indebtedness when due), or refund, refinance, replace or exchange any other Indebtedness for any such Indebtedness (except to the extent such Indebtedness is otherwise expressly permitted by the definition of “Permitted
Indebtedness”), or make any payment, prepayment, redemption, defeasance, sinking fund payment or repurchase of any outstanding Indebtedness as a result of any asset sale, change of control, issuance and sale of debt or equity securities or
similar event, or give any notice with respect to any of the foregoing; provided, that the Company may prepay the GMAC Loan on or before December 31, 2004 with the proceeds of an issuance of common stock of the Company (the “Common
Stock Issuance”) completed after the Second Amendment Effective Date and before December 31, 2004 in an amount not to exceed the lesser of (A) the net proceeds of the Common Stock Issuance (less the amount of any dividend paid pursuant to
paragraph 7.9(g) below) or (B) $3,000,000; 
  

	 	(f)	Assume, guarantee, endorse, or otherwise become liable upon the obligations of any person, firm, entity or corporation, except (i) for Support Obligations to the extent permitted in
clause (h) of the definition of Permitted Indebtedness and (ii) by the endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business; 

  

	 	(g)	Declare or pay any dividend or distributions of any kind on, or purchase, acquire, redeem or retire, any of the capital stock or equity interest, of any class whatsoever,
whether now or hereafter outstanding (other than the payment of accrued dividends and interest to UM Holdings Ltd. upon the conversion of the Preferred Stock held by UM Holdings Ltd. required in connection with the Common Stock Issuance; provided,
that such dividends and interest shall not exceed [$900,000] in the aggregate and shall be paid solely from the proceeds of the Common Stock Issuance); 

  

	 	(h)	Make any advance or loan to, or any investment in, any firm, entity, person or corporation or purchase or acquire all or substantially all of the stock or assets of any entity,
person or corporation; 

  

 45 

	 	(i)	Pay any management, consulting or other similar fees to any person, corporation or other entity affiliated with the Company (other than payments to any Affiliate described on
Schedule 5 hereto); or; 

  

	 	(j)	engage in any sale – leaseback transactions. 

  
 11.10 Until termination of the Financing Agreement and payment and satisfaction in full of all Obligations hereunder, the Company shall:

  

	 	(a)	have for each Fiscal Quarter set forth below the Fixed Charge Coverage Ratio corresponding to such Fiscal Quarter; provided that (v) for the Fiscal Quarter ending September 27,
2003, the Fixed Charge Coverage Ratio shall be calculated for the Fiscal Quarter ending September 27, 2003, (w) for the Fiscal Quarter ending December 31, 2003, the Fixed Charge Coverage Ratio shall be calculated for the two consecutive Fiscal
Quarters ending December 31, 2003, (x) for the Fiscal Quarter ending March 27, 2004, the Fixed Charge Coverage Ratio shall be calculated for the three consecutive Fiscal Quarters ending March 27, 2004, (y) for the Fiscal Quarter ending June 26,
2004, the Fixed Charge Coverage Ratio shall be calculated for the four consecutive Fiscal Quarters ending June 26, 2004, and (z) for each Fiscal Quarter thereafter, the Fixed Charge Coverage Ratio shall be calculated for the four consecutive Fiscal
Quarters ending at the end of such Fiscal Quarter. 

  

			
	 Period

	  	 Ratio

	 (i) For each Fiscal Quarter ending during the period commencing on the Closing Date through and including June 26, 2004
	  	greater than 1.0 to 1.0
		
	 (ii) For each Fiscal Quarter ending during the period commencing on June 27 2004 through and including June 25, 2005
	  	greater than 1.1 to 1.0
		
	 (iii) For each Fiscal Quarter ending thereafter
	  	greater than 1.2 to 1.0; and

  

	 	(b)	not contract for, purchase, make expenditures for, lease pursuant to a Capital Lease or otherwise incur obligations with respect to Capital Expenditures (whether subject to a
security interest or otherwise) in excess of $2,500,000 during the Company’s Fiscal Year ended December 31, 2003, $3,000,000 during the Company’s Fiscal year ended December 32, 2004 and $3,500,000 during the Company’s Fixed Year ended
December 31, 2005 and during each Fiscal Year thereafter (computed on a non-cumulative basis); 

  

 46 

	 	(c)	have Availability of at least $1,000,000 at all times; and 

  

	 	(d)	have for each Fiscal Quarter a Leverage Ratio less than or equal to 5.0 to 1.0; provided, that for each Fiscal Quarter, the Leverage Ratio shall be calculated for the four
consecutive Fiscal Quarters ending at the end of such Fiscal Quarter. 

  
 11.11 The Company agrees to advise CIT in writing of: (a) all expenditures (actual or anticipated) in excess of $150,000.00 from the budgeted amount therefor in any Fiscal Year for (x) environmental clean-up,
(y) environmental compliance or (z) environmental testing and the impact of said expenses on the Company’s Working Capital; and (b) any notices the Company receives from any local, state or federal authority advising the Company of any
environmental liability (real or potential) stemming from the Company’s operations, its premises, its waste disposal practices, or waste disposal sites used by the Company and to provide CIT with copies of all such notices if so required.

  
 11.12 The Company hereby agrees to indemnify and hold
harmless CIT and its officers, directors, employees, attorneys and agents (each an “Indemnified Party”) from, and holds each of them harmless against, any and all losses, liabilities, obligations, claims, actions, damages, costs and
expenses (including attorney’s fees) and any payments made by CIT pursuant to any indemnity provided by CIT with respect to or to which any Indemnified Party could be subject insofar as such losses, liabilities, obligations, claims, actions,
damages, costs, fees or expenses with respect to the Loan Documents, including without limitation those which may arise from or relate to: (i) the Depository Account, the Blocked Accounts, the lockbox and/or any other depository account and/or the
agreements executed in connection therewith, and (ii) any and all claims or expenses asserted against CIT as a result of any environmental pollution, hazardous material or environmental clean-up relating to the Real Estate; or any claim or expense
which results from the Company’s operations (including, but not limited to, the Company’s off-site disposal practices) and use of the Real Estate, which CIT may sustain or incur (other than solely as a result of the physical actions of CIT
on the Company’s premises which are determined to constitute gross negligence or willful misconduct by a court of competent jurisdiction), all whether through the alleged or actual negligence of such person or otherwise, except and to the
extent that the same results solely and directly from the gross negligence or willful misconduct of such Indemnified Party as finally determined by a court of competent jurisdiction. The Company hereby agrees that this indemnity shall survive
termination of this Financing Agreement, as well as payments of Obligations which may be due hereunder. CIT may, in its sole business judgment, establish such Availability Reserves with respect thereto as it may deem advisable under the
circumstances and, upon any termination hereof, hold such reserves as cash reserves for any such contingent liabilities. 
  
 11.13 Without the prior written consent of CIT, the Company agrees that it will not enter into any transaction, including, without limitation, any
purchase, sale, lease, loan or exchange of property any of its Affiliates (other than transactions between the Company and a Guarantor, provided that the aggregate amount of all loans, advances or other Transfers of assets by the Company to such
Guarantor shall not exceed $500,000 in the aggregate), provided that, except as otherwise set forth in this Financing Agreement (including, without limitation, in Schedule 5 attached hereto), the Company may enter into sale and service transactions
in the 
  

 47 

 ordinary course of its business and pursuant to the reasonable requirements of the Company, and upon standard terms and
conditions and fair and reasonable terms, no less favorable to the Company than the Company could obtain in a comparable arms length transaction with an unrelated third party, provided further that no Default or Event of Default exists or will occur
hereunder prior to and after giving effect to any such transaction.. 
  
 11.14 The Company agrees to maintain and preserve, and cause each of its subsidiaries to maintain and preserve, all of its properties which are necessary or useful in the proper conduct of its business in good working order and
condition, ordinary wear and tear excepted, and comply, and cause each of its subsidiaries to comply, at all times with the material provisions of all leases to which it is a party as lessee or under which it occupies property, so as to prevent any
loss or forfeiture thereof or thereunder. 
  
 11.15 The
Company agrees to obtain, maintain and preserve, and cause each of its subsidiaries to obtain, maintain and preserve, and take all necessary action to timely renew, all material permits, licenses, authorizations, approvals, entitlements and
accreditations which are necessary or useful in the proper conduct of its business. 
  
 11.16 The Company agrees to take such action and execute, acknowledge and deliver, and cause each of its subsidiaries to take such action and execute, acknowledge and deliver, at its sole cost and expense, such
agreements, instruments or other documents as CIT may require from time to time in order (a) to carry out more effectively the purposes of this Agreement and the other Loan Documents, (b) to subject to valid and perfected liens any of the Collateral
or any other property of the Company, (c) to establish and maintain the validity and effectiveness of any of the Loan Documents and, subject to the terms of the GMAC Intercreditor Agreement, the validity, perfection and priority of the liens
intended to be created thereby, and (d) to better assure, convey, grant, assign, transfer and confirm unto CIT the rights now or hereafter intended to be granted to its under this Agreement or any other Loan Document. In furtherance of the
foregoing, to the maximum extent permitted by applicable law, the Company (i) authorizes CIT to execute any such agreements, instruments or other documents in Company’s name and to file such agreements, instruments or other documents in the
filing office, (ii) authorizes CIT to file any financing statement required hereunder or under any appropriate filing office without the signature of the Company, and (iii) ratifies the filing of any financing statement, and any continuation
statement or amendment with respect thereto, filed without signature of the Company prior to the date hereof. 
  
 11.17 The Company agrees to cause all Indebtedness (other than Indebtedness and obligations described on Schedule 5 attached hereto) and other
obligations now or hereafter owed by it to any of its affiliates, to be subordinated in right of payment and security to agreement in form and substance satisfactory to CIT. 
  
 11.18 In order to induce CIT to enter into this Agreement and to make the loans and advances provided for herein and
to assist the Company in establishing or opening Letters of Credit, the Company makes, on or as of the occurrence of each such loan, advance or assistance (except to the extent such representations or warranties relate to an earlier date or are no
longer true and correct in all material respects solely as a result of transactions not prohibited by the Loan Documents), the following representations and warranties to CIT. 
  

 48 

 (a) Organization and Qualification. The Company (i) is duly organized validly existing and
in good standing under the laws of the jurisdiction of its incorporation or organization, (ii) has the corporate or limited liability company (as the case may be) power to own its property and to carry on its business as now conducted and (iii) is
duly qualified to do business and is in good standing, in each case in each jurisdiction in which the failure to be so qualified or in good standing would reasonably be expected to have a Material Adverse Effect. 
  
 (b) Authorization and Validity. The Company has the corporate
or limited liability company (as the case may be) power and authority to execute, deliver and perform its obligations hereunder and under the other Loan Documents to which the Company is a party and all such action has been duly authorized by all
necessary corporate proceedings on its part. The Loan Documents to which it is a party have been duly and validly executed and delivered by the Company and constitute valid and legally binding agreements of the Company enforceable in accordance with
the respective terms thereof, except, in each case, as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer or other similar laws relating to or affecting the enforcement of creditors’
rights generally and general principles of equity. 
  
 (c)
Consents. No authorization, consent, approval, license or exemption (other than such exemptions that exist under applicable law, that are permitted, or that have been obtained) of any person or filing or registration with any court or
governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign, is necessary for the valid, delivery or performance by the Company of any Loan Document to which it is a party or for the grant of a security
interest in or mortgage on the collateral covered by the Loan Documents, except such matters relating to performance as would ordinarily be done in the ordinary course of business after the date hereof. 
  
 (d) Conflicting or Adverse Agreements or Ratifications. Neither
the delivery of the Loan Documents nor compliance with the terms and provisions hereof or thereof will be contrary to the provisions of, or constitute a default under (i) the charter or bylaws or operating agreement (as the case may be) of the
Company or (ii) any applicable law or any applicable regulation, order, writ, injunction or decree of any court or governmental instrumentality or (iii) any material agreement to which the Company is a party or by which it is bound or to which it is
subject. 
  
 (e) Title to Assets; Licenses and
Permits. The Company has good title to all personal property and good and indefeasible title to or a subsisting leasehold interest in, all realty as reflected as of the date hereof on its books and records as being owned or leased by it
after giving effect to the transaction contemplated herein, subject to no liens except Permitted Encumbrances. All of such assets are being maintained by the appropriate person in good working condition in accordance with industry standards.

  

 49 

 (f) Litigation. Except as set forth in Schedule 2, no proceedings before any court or
governmental agency or department are pending against the Company and to the knowledge of the Company, none of same have been threatened which if adversely determined could reasonably be expected to have a Material Adverse Effect. 
  
 (g) No Defaults. The Company is not in default (i) under any
material provisions of any instrument evidencing any Indebtedness or of any agreement relating thereto in such manner as to cause a Material Adverse Effect or (ii) in any respect under or in violation of any order, writ, injunction or decree of any
court or governmental instrumentality, in such manner as to cause a Material Adverse Effect or (iii) under any provision of any material contract to which the Company is a party, which default would reasonably be expected to have a Material Adverse
Effect. The Company will give CIT prompt written notice of any event or circumstance that may constitute such a default and, in any event, will provide it upon receipt with copies of all material notices from landlords or other property owners with
respect to any business location or operation of the Company. 
  
 (h) Investment Company Act. The Company is not an “investment company,” as such term is defined in, or subject to registration under, the Investment Company Act of 1940, as amended. 
  
 (i) ERISA. The Company does not maintain or contribute to any
Benefit Plan other than those listed on Schedule 3. Each Benefit Plan has been and is being maintained and funded in accordance with its terms and in compliance in all material respects with all provisions of ERISA and the Internal Revenue
Code applicable thereto. The Company and each ERISA Affiliate have fulfilled all obligations related to the minimum funding standards of ERISA and the Internal Revenue Code for each Benefit Plan and no “accumulated funding deficiency,” as
such term is defined in Section 302 of ERISA and Section 412 of the Internal Revenue Code, has occurred or is reasonably likely to occur, nor do the conditions for imposition of a lien under Section 302(f) of ERISA exist or are reasonably likely to
exist, with respect to any Benefit Plan, and neither the Company nor any ERISA Affiliate has incurred any liability (other than routine liability for premiums) under Title IV of ERISA with respect to any Benefit Plan. No event or events have
occurred with respect to any Benefit Plan in connection with which the Company, any ERISA Affiliate, or, to the knowledge of the Company, any fiduciary of a Benefit Plan, directly or indirectly, would be subject to any material liability (other than
routine liability for premiums, contributions (if required) and, with respect to a Benefit Plan, routine liabilities for benefits), individually or in the aggregate, under ERISA or the Internal Revenue Code. 
  
 (j) Environmental Matters. To the best of the Company’s
knowledge, the Company (a) possesses all environmental, health and safety licenses, permits, authorizations, registrations, approvals and similar rights necessary under Environmental Laws for the Company to conduct its operations as now being
conducted, except where failure to have such licenses, permits, authorizations, registrations, approvals, and similar rights would not reasonably be expected to have a Material Adverse Effect, and (b) each of such licenses, permits, authorizations,
registrations, approvals and similar rights is valid and subsisting, in full force and effect and enforceable by the Company, and the Company is in compliance with all terms, conditions or other provisions of such permits, authorizations,
regulations, approvals and similar 
  

 50 

 rights except for such failure or noncompliance that, individually or in the aggregate for the Company, would not
reasonably be expected to have a Material Adverse Effect. The Company has not received any written notices of any violation or noncompliance with, or remedial obligation under, any Environmental Laws (which violation, non-compliance, or remedial
obligation has not been cured or would not reasonably be expected to have a Material Adverse Effect) and there are no writs, injunctions, decrees, orders or judgments outstanding under the Environmental Laws, or lawsuits, claims, proceedings, or, to
the knowledge of the Company, investigations or inquiries pending or threatened under Environmental Laws, relating to the ownership, use, condition, maintenance or operation of, or conduct of business related to, any property owned, leased or
operated by the Company or other assets of the Company other than those violations, instances of noncompliance, obligations, writs, injunctions, decrees, orders, judgments, lawsuits, claims, proceedings, investigations or inquiries that individually
or in the aggregate for the Company, would not reasonably be expected to have a Material Adverse Effect. There are no obligations, undertakings or liabilities arising out of or relating to Environmental Laws which the Company has agreed to, assumed
or retained, or to the best of the Company’s knowledge by which the Company are adversely affected, by contract or otherwise, except such obligations, undertakings or liabilities as would not reasonably be expected to have a Material Adverse
Effect. The Company has not received a written notice or claim to the effect that any of them are or may be liable to any other person as the result of a release or threatened release of a Hazardous Material except such notice or claim that would
not reasonably be expected to have a Material Adverse Effect. The Company has complied with all Environmental Laws and the requirements of any permits, licenses or other authorizations issued under any Environmental Laws, except any noncompliance
that would not reasonably be expected to have a Material Adverse Effect. 
  
 (k) Purpose of Loans. The proceeds of the Revolving Loans and the Term Loan will be used by the Company to refinance existing Indebtedness and for working capital purposes. None of the proceeds of any
Revolving Loans or the Term Loan will be used directly or indirectly for the purpose of purchasing or carrying any “margin stock” within the meaning of Regulation U (herein called “margin stock”) or for the purpose of reducing or
retiring any indebtedness which was originally incurred to purchase or carry margin stock, or for any other purpose which might constitute this transaction as a “purpose credit” within the meaning of Regulation U. Neither the Company nor
any agent acting on its behalf has taken or will take any action which might cause this Agreement or any other Loan Document to violate Regulation U, Regulation X or any other regulation of the Board of Governors or to violate the Securities
Exchange Act of 1934. 
  
 (l) Insurance. The Company
maintains insurance of such types as is usually carried by corporations of established reputation engaged in the same or similar businesses and similarly situated with financially sound, responsible and reputable insurance companies or associations
(or, as to workers’ compensation or similar insurance, with an insurance fund or by self-insurance authorized by the jurisdiction in which its operations are carried on) and in such amounts (and with co-insurance and deductibles) as such
insurance is usually carried by corporations of established reputation and engaged in the same or similar businesses and similarly situated, but in any event, with respect to improvements to real property and tangible personal property (assuming the
subject improvements are in fact replaced or restored), in amounts acceptable to CIT. Company does not maintain any formalized self-insurance program with respect to its assets or operations or material risks with respect thereto. 
  

 51 

 (m) Indebtedness and Contingent Liabilities. Except as disclosed in writing to CIT, the
Company does not have any outstanding Indebtedness (excluding the loans and advances hereunder) or material contractually assumed contingent liabilities other than Permitted Indebtedness. 
  
 (n) Security Interests in Favor of CIT. This Agreement and the other Loan Documents create valid security
interest and liens in all of the Collateral described therein in favor of CIT securing the Obligations and constitute (subject to (i) the filing of financing statements on the date hereof and thereafter from time to time on the CIT’s request
therefor and (ii) delivery of any collateral after the date hereof as provided herein or any other Loan Document and (iii) the execution of Blocked Account Agreements with the banks which maintain Depository Accounts) and, except for Permitted
Encumbrances, perfected first priority liens and security interests in substantially all of such collateral described therein subject to no liens other than Permitted Encumbrances 
  
 (o) USA Patriot Act. Neither the making of the Loans hereunder (or the extension of any other credit
contemplated hereunder) nor the Company’s use of the proceeds thereof will violate Sections 326 and 371 through 377 of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of
2001, Pub. L. No. 107-56 (also known as the USA Patriot Act) or any enabling legislation or rules, regulations or executive orders relating thereto. 
  
 (p) Guarantors. Tetrix Fitness Equipment, Inc. has no assets other than intangible assets associated with its acquisition by the Company and
Cybex Capital Corp. has no assets other than a depreciating asset of $350,000, comprised of leases which are in run-down. 
  
 (q) Inactive Subsidiary. The Inactive Subsidiary does not (i) have any material operations or conduct any material business, or (ii) have
assets of $50,000 or greater. 
  
 SECTION 12. Interest, Fees
and Expenses 
  
 12.1 (a) Interest on the
Revolving Loans, whether bearing interest based on the Chase Bank Rate or LIBOR, shall be payable monthly as of the end of each month. Revolving Loans which are Chase Bank Rate Loans shall bear interest during each month at a rate equal to the Chase
Bank Rate plus the Applicable Margin on the average of the net balances owing by the Company to CIT in the Revolving Loan Account at the close of each day during such month. In the event of any change in said Chase Bank Rate, the rate hereunder for
Revolving Loans which are Chase Bank Rate Loans shall change, as of the date of such change, so as to remain at the Chase Bank Rate plus the Applicable Margin. The rate hereunder for Revolving Loans which are Chase Bank Rate Loans shall be
calculated based on a 360-day year. CIT shall be entitled to charge the Company’s Revolving Loan Account at the rate provided for herein when due until all Obligations have been paid in full. 
  

 52 

 (b) Notwithstanding any provision to the contrary contained in this section 8, in the event that
the sum of (i) the outstanding Revolving Loans and (ii) the outstanding Letters of Credit exceed the lesser of either (x) the Borrowing Base less Availability Reserves or (y) the Revolving Line of Credit: (A) as a result of Revolving Loans advanced
by CIT at the request of the Company (herein “Requested Overadvances”), for any one (1) or more days in any month or (B) for any other reason whatsoever (herein “Other Overadvances”) and such Other Overadvances continue for five
(5) or more days in any month, the average net balance of all Revolving Loans for such month shall bear interest at the Overadvance Rate. Upon and after the occurrence of an Event of Default and the giving of any required notice by CIT in accordance
with the provisions of Section 10, Paragraph 10.2 hereof, all Obligations shall bear interest at the Default Rate of Interest. 
  
 12.2 Interest on the Term Loan shall be payable monthly as of the end of each month on the unpaid balance or on payment in full prior to maturity
and shall be in an amount equal to the greater of (i) the Chase Bank Rate plus three percent (3.0%) per annum or (ii) seven percent (7%) per annum. In the event of any change in said Chase Bank Rate the rate hereunder for the Term Loan shall change,
as of the date of such change, so as to remain at the greater of (i) three percent (3.0%) above the Chase Bank Rate or (ii) seven percent (7%) per annum. The rate hereunder shall be calculated based on a 360 day year. CIT shall be entitled to charge
the Revolving Loan Account at the rate provided for herein when due. 
  
 12.3 In consideration of the Letter of Credit Guaranty of CIT, the Company shall pay CIT the Letter of Credit Guaranty Fee which shall be an amount equal to (a) three percent (3.0%) on the face amount of each documentary Letter of
Credit payable upon issuance thereof and (b) three percent (3.0%) per annum, payable monthly, on the face amount of each standby Letter of Credit less the amount of any and all amounts previously drawn under such standby Letter of Credit.

  
 12.4 Any and all charges, fees, commissions, costs and
expenses charged to CIT for the Company’s account by any Issuing Bank in connection with, or arising out of, Letters of Credit or out of transactions relating thereto will be charged to the Revolving Loan Account in full when charged to, or
paid by CIT, or as may be due upon any termination of this Financing Agreement hereof, and when made by any such Issuing Bank shall be conclusive on CIT. 
  
 12.5 The Company shall reimburse or pay CIT, as the case may be, for: (a) all Out-of-Pocket Expenses and (b) any applicable Documentation Fee.

  
 12.6 Upon the last Business Day of each month,
commencing on July 31, 2003, the Company shall pay to CIT (i) the Line of Credit Fee, and (ii) interest on the Collection Days. Interest will be computed at the rate, and in the manner, set forth in Paragraph 8.1 of this Financing Agreement.

  
 12.7 To induce CIT to enter into this Financing
Agreement and to extend to the Company the Revolving Loans and Term Loan, the Company shall pay to CIT a Loan Facility Fee in the amount of $285,000, $190,000 of which will be payable on the Closing Date (reduced by the $50,000 fee payable on the
Closing Date pursuant to Section 8.8(ii) below) and $95,000 of which will be payable on December 31, 2003. 
  

 53 

 12.8 On the Closing Date and each anniversary of the Closing Date thereafter, the Company shall
pay to CIT (i) the Administrative Management Fee in the amount of $18,000.00 and (ii) a fee in the amount of $50,000.00 for the administration of the Foreign Borrowing Base. 
  
 12.9 The Company shall pay CIT’s standard charges and fees for CIT’s personnel used by CIT for reviewing
the books and records of the Company and for verifying, testing, protecting, safeguarding, preserving or disposing of all or any part of the Collateral (which fees shall be in addition to the Administrative Management Fee and any Out-of-Pocket
Expenses). 
  
 12.10 The Company hereby authorizes CIT to
charge the Revolving Loan Account with the amount of all payments due hereunder as such payments become due. The Company confirms that any charges which CIT may so make to the Revolving Loan Account as herein provided will be made as an
accommodation to the Company and solely at CIT’s discretion. 
  
 12.11 In the event that CIT or any participant hereunder (or any financial institution which may from time to time become a participant or lender hereunder) shall have determined in the exercise of its reasonable business judgement
that subsequent to the Closing Date any change in applicable law, rule, regulation or guideline regarding capital adequacy, or any change in the interpretation or administration thereof, or compliance by CIT or such participant with any new 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 CIT’s or such participant’s capital
as a consequence of its obligations hereunder to a level below that which CIT or such participant could have achieved but for such adoption, change or compliance (taking into consideration CIT or such participant’s policies with respect to
capital adequacy) by an amount reasonably deemed by CIT or such participant to be material, then, from time to time, the Company shall pay no later than five (5) days following demand to CIT or such participant such additional amount or amounts as
will compensate CIT’s or such participant’s for such reduction. In determining such amount or amounts, CIT or such participant may use any reasonable averaging or attribution methods. The protection of this Paragraph 8.11 shall be
available to CIT or such participant regardless of any possible contention of invalidity or inapplicability with respect to the applicable law, regulation or condition. A certificate of CIT or such participant setting forth such amount or amounts as
shall be necessary to compensate CIT or such participant with respect to this Section 8 and the calculation thereof when delivered to the Company shall be conclusive on the Company absent manifest error. Notwithstanding anything in this paragraph to
the contrary, in the event CIT or such participant has exercised its rights pursuant to this paragraph, and subsequent thereto determines that the additional amounts paid by the Company in whole or in part exceed the amount which CIT or such
participant actually required pursuant hereto, the excess, if any, shall be returned to the Company by CIT or such participant. 
  
 12.12 In the event that any applicable law, treaty or governmental regulation, or any change therein or in the interpretation or application
thereof, or compliance by CIT or such 
  

 54 

 participant 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 CIT or such participant to any tax of any kind whatsoever with respect to this Financing Agreement or change the basis of taxation of payments to CIT or such participant of principal, fees, interest or any other amount
payable hereunder or under any other documents (except for changes in the rate of tax on the overall net income of CIT or such participant by the federal government or the jurisdiction in which it maintains its principal office); 
  
 (b) impose, modify or hold applicable any reserve,
special deposit, assessment or similar requirement against assets held by, or deposits in or for the account of, advances or loans by, or other credit extended by CIT or such participant by reason of or in respect to this Financing Agreement and the
Loan Documents, including (without limitation) pursuant to Regulation D of the Board of Governors of the Federal Reserve System; or 
  
 (c) impose on CIT or such participant any other condition with respect to this Financing Agreement or any other document, and the
result of any of the foregoing is to increase the cost to CIT or such participant of making, renewing or maintaining its loans hereunder by an amount that CIT or such participant deems to be material in the exercise of its reasonable business
judgement or to reduce the amount of any payment (whether of principal, interest or otherwise) in respect of any of the loans by an amount that CIT or such participant deems to be material in the exercise of its reasonable business judgement, then,
in any case the Company shall pay CIT or such participant, within five (5) days following its demand, such additional cost or such reduction, as the case may be. CIT or such participant shall certify the amount of such additional cost or reduced
amount to the Company and the calculation thereof and such certification shall be conclusive upon the Company absent manifest error. Notwithstanding anything in this paragraph to the contrary, in the event CIT or such participant has exercised its
rights pursuant to this paragraph, and subsequent thereto determine that the additional amounts paid by the Company in whole or in part exceed the amount which CIT or such participant actually required pursuant hereto, the excess, if any, shall be
returned to the Company by CIT or such participant. 
  
 12.13 The Company may request LIBOR Loans on the following terms and conditions: 
  
 (a) The Company may elect, subsequent to five (5) days from the Closing Date and from time to time thereafter (i) to request any
loan made hereunder to be a LIBOR Loan as of the date of such loan or (ii) to convert Chase Bank Rate Loans to LIBOR Loans, and may elect from time to time to convert LIBOR Loans to Chase Bank Rate Loans by giving CIT at least three (3) Business
Days’ prior irrevocable notice of such election, provided that any such conversion of LIBOR Loans to Chase Bank Rate Loans shall only be made, subject to the second following sentence, on the last day of an Interest Period with respect
thereto. Should the Company elect to convert Chase Bank Rate Loans to LIBOR Loans, it shall give CIT at least four Business Days’ prior 
  

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 irrevocable notice of such election. If the last day of an Interest Period with respect to a loan that is
to be converted is not a Business Day or Working Day, then such conversion shall be made on the next succeeding Business Day or Working Day, as the case may be, and during the period from such last day of an Interest Period to such succeeding
Business Day, as the case may be, such loan shall bear interest as if it were an Chase Bank Rate Loan. All or any part of outstanding Chase Bank Rate Loans then outstanding with respect to Revolving Loans, Term Loans may be converted to LIBOR Loans
as provided herein, provided that partial conversions shall be in multiples in an aggregate principal amount of $1,000,000 or more. The aggregate amount of all such LIBOR Loans shall not exceed $7,000,000.00 at any one time
outstanding. CIT shall be entitled to charge the Company a $500 fee upon the first effective day of any such election for a LIBOR Loan. 
  
 (b) Any LIBOR Loans may be continued as such upon the expiration of an Interest Period, provided the Company so notifies
CIT, at least three (3) Business Days’ prior to the expiration of said Interest Period, and provided further that no LIBOR Loan may be continued as such upon the occurrence of any Default or Event of Default under this Financing
Agreement, but shall be automatically converted to a Chase Bank Rate Loan on the last day of the Interest Period during which occurred such Default or Event of Default. Absent such notification, LIBOR Rate Loans shall convert to Chase Bank Rate
Loans on the last day of the applicable Interest Period. Each notice of election, conversion or continuation furnished by the Company pursuant hereto shall specify whether such election, conversion or continuation is for a month period.
Notwithstanding anything to the contrary contained herein, CIT (or any participant, if applicable) shall not be required to purchase United States Dollar deposits in the London interbank market or from any other applicable LIBOR Rate market or
source or otherwise “match fund” to fund LIBOR Rate Loans, but any and all provisions hereof relating to LIBOR Rate Loans shall be deemed to apply as if CIT (and any participant, if applicable) had purchased such deposits to fund any LIBOR
Rate Loans. 
  
 (c) The Company may
request a LIBOR Loan, convert any Chase Bank Rate Loan or continue any LIBOR Loan provided there is then no Default or Event of Default in effect. 
  
 12.14 (a) The LIBOR Loans shall bear interest for each Interest Period with respect thereto on the unpaid principal amount thereof at a rate per
annum equal to the LIBOR determined for each Interest Period in accordance with the terms hereof plus the Applicable Margin. 
  
 (b) If all or a portion of the outstanding principal amount of the Obligations shall not be paid when due (whether at the stated
maturity, by acceleration or otherwise), such outstanding amount, to the extent it is a LIBOR Loan, shall be converted to a Chase Bank Rate Loan at the end of the last Interest Period therefor. 
  
 (c) The Company may not have more than four (4) LIBOR
Loans outstanding at any given time. 
  

 56 

 12.15 (a) Interest in respect of the LIBOR Loans shall be calculated on the basis of a 360 day
year and shall be payable on the last day of each month and the last day of the applicable Interest Period. 
  
 (b) CIT shall, at the request of the Company, deliver to the Company a statement showing the quotations given by JP Morgan Chase
Bank and the computations used in determining any interest rate pursuant to Paragraph 8.14 of Section 8 hereof. 
  
 12.16 As further set forth in paragraph 8.12 above, in the event that CIT (or any financial institution which may become a participant hereunder)
shall have determined in the exercise of its reasonable business judgment (which determination shall be conclusive and binding upon the Company) that by reason of circumstances affecting the interbank LIBOR market, adequate and reasonable means do
not exist for ascertaining LIBOR applicable for any Interest Period with respect to (a) a proposed loan that the Company has requested be made as a LIBOR Loan, (b) a LIBOR Loan that will result from the requested conversion of a Chase Bank Rate Loan
into a LIBOR Loan or (c) the continuation of LIBOR Loans beyond the expiration of the then current Interest Period with respect thereto, CIT shall forthwith give written notice of such determination to the Company at least one day prior to, as the
case may be, the requested borrowing date for such LIBOR Loan, the conversion date of such Chase Bank Rate Loan or the last day of such Interest Period. If such notice is given (i) any requested LIBOR Loan shall be made as a Chase Bank Rate Loan,
(ii) any Chase Bank Rate Loan that was to have been converted to a LIBOR Loan shall be continued as a Chase Bank Rate Loan, and (iii) any outstanding LIBOR Loan shall be converted, on the last day of then current Interest Period with respect
thereto, to a Chase Bank Rate Loan. Until such notice has been withdrawn by CIT, no further LIBOR Loan shall be made nor shall the Company have the right to convert a Chase Bank Rate Loan to a LIBOR Loan. 
  
 12.17 If any payment on a LIBOR Loan becomes due and payable on a day
other than a Business Day or Working Day, the maturity thereof shall be extended to the next succeeding Business Day or Working Day unless the result of such extension would be to extend such payment into another calendar month in which event such
payment shall be made on the immediately preceding Business Day or Working Day. 
  
 12.18 Notwithstanding any other provisions herein, if any law, regulation, treaty or directive or any change therein or in the interpretation or application thereof, shall make it unlawful for CIT to make or
maintain LIBOR Loans as contemplated herein, the then outstanding LIBOR Loans, if any, shall be converted automatically to Chase Bank Rate Loans as of the end of such month, or within such earlier period as required by law. The Company hereby agrees
promptly to pay CIT, upon its demand, any additional amounts necessary to compensate CIT for any costs incurred by CIT in making any conversion in accordance with this Section 8 including, but not limited to, any interest or fees payable by CIT to
lenders of funds obtained by CIT in order to make or maintain LIBOR Loans hereunder. 
  
 12.19 The Company agrees to indemnify and to hold CIT (including any participant) harmless from any loss or expense which CIT or such participant may sustain or incur as a 
  

 57 

 consequence of (a) default by the Company in payment of the principal amount of or interest on any LIBOR Loans, as and
when the same shall be due and payable in accordance with the terms of this Financing Agreement, including, but not limited to, any such loss or expense arising from interest or fees payable by CIT or such participant to lenders of funds obtained by
either of them in order to maintain the LIBOR Loans hereunder, (b) default by the Company in making a borrowing or conversion after the Company has given a notice in accordance with Paragraph 8.13 of Section 8 hereof, (c) any prepayment of LIBOR
Loans on a day which is not the last day of the Interest Period applicable thereto, including, without limitation, prepayments arising as a result of the application of the proceeds of Collateral to the Revolving Loans and (d) default by the Company
in making any prepayment after the Company had given notice to CIT thereof. The determination by CIT of the amount of any such loss or expense, when set forth in a written notice to the Company, containing CIT’s calculations thereof in
reasonable detail, shall be conclusive on the Company in the absence of manifest error. Calculation of all amounts payable under this paragraph with regard to LIBOR Loans shall be made as though CIT had actually funded the LIBOR Loans through the
purchase of deposits in the relevant market and currency, as the case may be, bearing interest at the rate applicable to such LIBOR Loans in an amount equal to the amount of the LIBOR Loans and having a maturity comparable to the relevant interest
period provided, however, that CIT may fund each of the LIBOR Loans in any manner CIT sees fit and the foregoing assumption shall be used only for calculation of amounts payable under this paragraph. In addition, notwithstanding
anything to the contrary contained herein, CIT shall apply all proceeds of Collateral and all other amounts received by it from or on behalf of the Company (i) initially to the Chase Bank Rate Loans and (ii) subsequently to LIBOR Loans;
provided, however, (x) upon the occurrence of an Event of Default or (y) in the event the aggregate amount of outstanding LIBOR Rate Loans exceeds Availability or the applicable maximum levels set forth therefor, CIT may apply all such
amounts received by it to the payment of Obligations in such manner and in such order as CIT may elect in its reasonable business judgment. In the event that any such amounts are applied to Revolving Loans which are LIBOR Loans, such application
shall be treated as a prepayment of such loans and CIT shall be entitled to indemnification hereunder. This covenant shall survive termination of this Financing Agreement and payment of the outstanding Obligations. 
  
 12.20 Notwithstanding anything to the contrary in this Agreement, in
the event that, by reason of any Regulatory Change (for purposes hereof “Regulatory Change” shall mean, with respect to CIT, any change after the date of this Financing Agreement in United States federal, state or foreign law or
regulations (including, without limitation, Regulation D) or the adoption or making after such date of any interpretation, directive or request applying to a class of banks including CIT of or under any United States federal, state or foreign law or
regulations (whether or not having the force of law and whether or not failure to comply therewith would be unlawful), CIT either (a) incurs any material additional costs based on or measured by the excess above a specified level of the amount of a
category of deposits or other liabilities of such bank which includes deposits by reference to which the interest rate on LIBOR Loans is determined as provided in this Financing Agreement or a category of extensions of credit or other assets of CIT
which includes LIBOR Loans or (b) becomes subject to any material restrictions on the amount of such a category of liabilities or assets which it may hold, then, if CIT so elects by notice to the Company the obligation of CIT to make or continue, or
to convert Chase Bank Rate Loans into LIBOR Loans hereunder shall be suspended until such Regulatory Change ceases to be in effect. 
  

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 12.21 For purposes of this Financing Agreement and Section 8 thereof, any reference to CIT shall
include any financial institution which may become a participant or co-lender subsequent to the Closing Date. 
  
 SECTION 13. Powers 
  
 The Company hereby constitutes CIT, or any person or agent CIT may designate, as its attorney-in-fact, at the Company’s cost and expense, to exercise
all of the following powers, which being coupled with an interest, shall be irrevocable until all Obligations to CIT have been paid in full: 
  
 (a) To receive, take, endorse, sign, assign and deliver, all in the name of CIT or the Company, any and all checks, notes, drafts,
and other documents or instruments relating to the Collateral; 
  
 (b) To receive, open and dispose of all mail addressed to the Company and to notify postal authorities to change the address for delivery thereof to such address as CIT may designate; 
  
 (c) To request from customers indebted on Accounts at
any time, in the name of CIT information concerning the amounts owing on the Accounts; 
  
 (d) To request from customers indebted on Accounts at any time, in the name of the Company, in the name of certified public
accountant designated by CIT or in the name of CIT’s designee, information concerning the amounts owing on the Accounts; 
  
 (e) To transmit to customers indebted on Accounts notice of CIT’s interest therein and to notify customers indebted on
Accounts to make payment directly to CIT for the Company’s account; and 
  
 (f) To take or bring, in the name of CIT or the Company, all steps, actions, suits or proceedings deemed by CIT necessary or
desirable to enforce or effect collection of the Accounts. 
  
 Notwithstanding anything hereinabove contained to the contrary, the powers set forth in (b), (c), (e) and (f) above may only be exercised after the occurrence of an Event of Default and until such time as such Event of Default is waived in
writing by CIT. 
  
 SECTION 14. Events of Default and
Remedies 
  
 14.1 Notwithstanding anything
hereinabove to the contrary, CIT may terminate this Financing Agreement immediately upon the occurrence of any of the following (herein “Events of Default”): 
  

	(a)	cessation of the business of the Company or the calling of a meeting of the creditors of the Company for purposes of compromising the debts and obligations of the Company;

  

 59 

	(b)	the failure of the Company to generally meet its debts as they mature; 

  

	(c)	(i) the commencement by the Company of any bankruptcy, insolvency, arrangement, reorganization, receivership or similar proceedings under any federal or state law; (ii) the
commencement against the Company, of any bankruptcy, insolvency, arrangement, reorganization, receivership or similar proceeding under any federal or state law by creditors of the Company, provided that such Default shall not be deemed an Event of
Default if such proceeding is controverted within ten (10) days and dismissed and vacated within thirty (30) days of commencement, except in the event that any of the actions sought in any such proceeding shall occur or the Company shall take action
to authorize or effect any of the actions in any such proceeding, or (iii) the commencement (x) by the Company’s subsidiaries, or any one of them, of any bankruptcy, insolvency, arrangement, reorganization, receivership or similar proceeding
under any applicable state law, or (y) against the Company’s subsidiaries, or any one of them, of any involuntary bankruptcy, insolvency, arrangement, reorganization, receivership or similar proceeding under applicable law, provided that such
Default shall not be deemed an Event of Default if such proceeding is controverted within ten (10) days and dismissed or vacated within thirty (30) days of commencement, except in the event that any of the actions sought in any such proceeding shall
occur or the Company’s subsidiaries, or any one of them, shall take action to authorize or effect any of the actions in any such proceeding; 

  

	(d)	breach by the Company of any warranty, representation or covenant contained herein (other than those referred to in sub-paragraph (e) below) or in any other written agreement
between the Company or CIT, provided that such Default by the Company of any of the warranties, representations or covenants referred in this clause (d) shall not be deemed to be an Event of Default unless and until such Default shall remain
unremedied to CIT’s satisfaction for a period of ten (10) days from the date of such breach; 

  

	(e)	breach by the Company of any warranty, representation or covenant of Paragraphs 3.3 (other than the fourth sentence of Paragraph 3.3) and 3.4 of Section 3 hereof; Paragraphs 6.3 and
6.4 (other than the first sentence of Paragraph 6.4) of Section 6 hereof; Paragraphs 7.1, 7.5, 7.6, and 7.8 through 7.18 hereof; 

  

	(f)	failure of the Company to pay any of the Obligations within five (5) Business Days of the due date thereof, provided that nothing contained herein shall prohibit CIT from charging
such amounts to the Revolving Loan Account on the due date thereof; 

  

	(g)	the Company shall (i) engage in any “prohibited transaction” as defined in ERISA, (ii) have any “accumulated funding deficiency” as defined in ERISA, (iii) have
any “reportable event” as defined in ERISA, (iv) terminate any “plan”, as defined in ERISA or (v) be engaged in any proceeding in which the Pension Benefit Guaranty Corporation shall seek appointment, or is appointed, as trustee

  

 60 

 or administrator of any “plan”, as defined in ERISA, and with respect to this sub-paragraph (h)
such event or condition (x) remains uncured for a period of thirty (30) days from date of occurrence and (y) could, in the reasonable opinion of CIT, subject the Company to any tax, penalty or other liability material to the business, operations or
financial condition of the Company; 
  

	 	(h)	without the prior written consent of CIT and, except as permitted in the Subordination Agreement, the Company shall (x) amend or modify the Subordinated Debt, or (y) make any
payment on account of the Subordinated Debt; 

  

	 	(i)	the occurrence of any default or event of default (after giving effect to any applicable grace or cure periods) under any instrument or agreement evidencing (x) Subordinated Debt or
(y) any other Indebtedness of the Company having a principal amount in excess of $250,000 (including Indebtedness with respect to the GMAC Loan); 

  

	 	(j)	(i) any “person” or “group” (within the meaning of Sections 13(d) and 14(d) of the Exchange Act) becomes the beneficial owner (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of a percentage of the stock of the Company having the right to vote for the election of members of the Board of Directors which is in excess of the percentage of such stock beneficially owned by UM Holdings,
Ltd. and its Affiliates, (ii) a majority of the members of the Board of Directors do not constitute Continuing Directors, (iii) the Company ceases to own, directly or indirectly, and control 100% of the outstanding stock of each of its subsidiaries
(other than the Inactive Subsidiaries) existing on the Closing Date, (iv) John Aglialoro ceases for any reason whatsoever (other than as a result of death or disability) to be actively engaged in the management of the Company or (v) UM Holdings,
Ltd. and/or its Affiliates shall at any time collectively own less than 40% of the issued and outstanding voting stock of the Company; 

  

	 	(k)	there shall remain in force, undischarged and unsatisfied for more than sixty (60) days, whether or not consecutive, without a stay of execution, any judgment against the
Company or any of its subsidiaries that, with other outstanding final judgments, undischarged, against the Company or any of its subsidiaries exceeds in the aggregate $250,000.00; 

  

	 	(l)	any Loan Document is invalidated or declared null and void or otherwise ceases to be in full force and effect; 

  

	 	(m)	if at any time CIT’s security interest in the Collateral is impaired or invalidated or does not constitute a first priority perfected security interest (other than
Permitted Encumbrances); 

  

	 	(n)	if any license, permit or qualification material to the business of the Company and its subsidiaries, on a consolidated basis, is terminated, cancelled or invalidated; or

  

	 	(o)	if the validity or enforceability of any Loan Document is contested by the Company or if the Company denies liability thereunder. 

  
 14.2 Upon the occurrence of a Default and/or an Event of Default, at
the option of CIT, all loans, advances and extensions of credit provided for in Sections 3, 4 and 5 of this Financing 
  

 61 

 Agreement shall be thereafter in CIT’s sole discretion and the obligation of CIT to make Revolving Loans and/or open
Letters of Credit shall cease unless such Default is cured to CIT’s satisfaction or Event of Default is waived in writing by CIT , and at the option of CIT upon the occurrence of an Event of Default: (a) all Obligations shall become
immediately due and payable; (b) CIT may charge the Company the Default Rate of Interest on all then outstanding or thereafter incurred Obligations in lieu of the interest provided for in Section 8 of this Financing Agreement, provided that,
with respect to this clause “(b)” CIT has given the Company written notice of the Event of Default, provided, however, that no notice is required if the Event of Default is the Event listed in Paragraph 10.1(c) of this Section 10, and
(c) CIT may immediately terminate this Financing Agreement upon notice to the Company, provided, however, that upon the occurrence of an Event of Default listed in Paragraph 10.1(c) of this Section 10, this Financing Agreement shall
automatically terminate and all Obligations shall become due and payable, without any action, declaration, notice or demand by CIT. The exercise of any option is not exclusive of any other option, which may be exercised at any time by CIT.

  
 14.3 Immediately upon the occurrence of any Event of
Default, CIT may, to the extent permitted by law: (a) remove from any premises where same may be located any and all books and records, computers, electronic media and software programs associated with any Collateral (including any electronic
records, contracts and signatures pertaining thereto), documents, instruments, files and records, and any receptacles or cabinets containing same, relating to the Accounts, or CIT may use, at the Company’s expense, such of the Company’s
personnel, supplies or space at the Company’s places of business or otherwise, as may be necessary to properly administer and control the Accounts or the handling of collections and realizations thereon; (b) bring suit, in the name of
the Company or CIT, and generally shall have all other rights respecting said Accounts, including without limitation the right to: accelerate or extend the time of payment, settle, compromise, release in whole or in part any amounts owing on any
Accounts and issue credits in the name of the Company or CIT; (c) sell, assign and deliver the Collateral and any returned, reclaimed or repossessed Inventory, with or without advertisement, at public or private sale, for cash, on credit or
otherwise, at CIT’s sole option and discretion, and CIT may bid or become a purchaser at any such sale, free from any right of redemption, which right is hereby expressly waived by the Company; (d) foreclose the security interests in the
Collateral created herein or by the Loan Documents by any available judicial procedure, or to take possession of any or all of the Collateral, including any Inventory and/or Other Collateral without judicial process, and to enter any premises where
any Inventory and/or Other Collateral may be located for the purpose of taking possession of or removing the same and (e) exercise any other rights and remedies provided in law, in equity, by contract or otherwise. CIT shall have the right,
without notice or advertisement, to sell, lease, or otherwise dispose of all or any part of the Collateral, whether in its then condition or after further preparation or processing, in the name of the Company or CIT, or in the name of such other
party as CIT may designate, either at public or private sale or at any broker’s board, in lots or in bulk, for cash or for credit, with or without warranties or representations, and upon such other terms and conditions as CIT in its sole
discretion may deem advisable, and CIT shall have the right to purchase at any such sale. If any Inventory shall require rebuilding, repairing, maintenance, finishing or preparation, CIT shall have the right, at its option, to do such of the
aforesaid as is necessary, for the purpose of putting the Inventory in such saleable form as CIT shall deem appropriate. The Company 
  

 62 

 agrees, at the request of CIT, to assemble the Inventory and to make it available to CIT at premises of the Company or
elsewhere and to make available to CIT the premises and facilities of the Company for the purpose of CIT’s taking possession of, removing or putting the Inventory in saleable form, including finishing. If notice of intended disposition of any
Collateral is required by law, it is agreed that ten (10) days notice shall constitute reasonable notification and full compliance with the law. The net cash proceeds resulting from CIT’s exercise of any of the foregoing rights, (after
deducting all charges, costs and expenses, including reasonable attorneys’ fees) shall be applied by CIT to the payment of the Obligations, whether due or to become due, in such order as CIT may elect, and the Company shall remain liable to CIT
for any deficiencies, and CIT in turn agrees to remit to the Company or its successors or assigns, any surplus resulting therefrom. The enumeration of the foregoing rights is not intended to be exhaustive and the exercise of any right shall not
preclude the exercise of any other rights, all of which shall be cumulative. The Company hereby indemnifies CIT and holds CIT harmless from any and all costs, expenses, claims, liabilities, Out-of-Pocket Expenses or otherwise, incurred or imposed on
CIT by reason of the exercise of any of its rights, remedies and interests hereunder, including, without limitation, from any sale or transfer of Collateral, preserving, maintaining or securing the Collateral, defending its interests in Collateral
(including pursuant to any claims brought by the Company, the Company as debtor-in-possession, any secured or unsecured creditors of the Company, any trustee or receiver in bankruptcy, or otherwise), and the Company hereby agrees to so indemnify and
hold CIT harmless, absent CIT’s gross negligence or willful misconduct as finally determined by a court of competent jurisdiction. The foregoing indemnification shall survive termination of this Financing Agreement until such time as all
Obligations (including the foregoing) have been finally and indefeasibly paid in full. In furtherance thereof CIT, may establish such reserves for Obligations hereunder (including any contingent Obligations) as it may deem advisable in its
reasonable business judgment. 
  
 SECTION 15.
Termination 
  
 Except as otherwise permitted herein,
CIT may terminate this Financing Agreement only as of the initial or any subsequent Anniversary Date and then only by giving the Company at least sixty (60) days prior written notice of termination. Notwithstanding the foregoing CIT may terminate
the Financing Agreement immediately upon the occurrence of an Event of Default, provided, however, that if the Event of Default is an event listed in Paragraph 10.1(c) of Section 10 of this Financing Agreement, this Financing Agreement shall
terminate in accordance with paragraph 10.2 of Section 10. This Financing Agreement, unless terminated as herein provided, shall automatically continue from Anniversary Date to Anniversary Date. The Company may terminate this Financing Agreement at
any time upon sixty (60) days’ prior written notice to CIT, provided that the Company pays to CIT immediately on demand an Early Termination Fee, if applicable. All Obligations shall become due and payable as of any termination hereunder or
under Section 10 hereof and, pending a final accounting, CIT may withhold any balances in the Company’s account (unless supplied with an indemnity satisfactory to CIT) to cover all of the Obligations, whether absolute or contingent, including,
but not limited to, cash reserves for any contingent Obligations, including an amount of 110% of the face amount of any outstanding Letters of Credit with an expiry date on, or within thirty (30) days of the effective date of termination of this
Financing Agreement. All of CIT’s rights, liens and security interests shall continue after any termination until all Obligations have been paid and satisfied in full. 
  

 63 

 SECTION 16. Miscellaneous 
  
 16.1 The Company hereby waives diligence, notice of intent to accelerate, notice of acceleration, demand, presentment
and protest and any notices thereof as well as notice of nonpayment. No delay or omission of CIT or the Company to exercise any right or remedy hereunder, whether before or after the happening of any Event of Default, shall impair any such right or
shall operate as a waiver thereof or as a waiver of any such Event of Default. No single or partial exercise by CIT of any right or remedy precludes any other or further exercise thereof, or precludes any other right or remedy. 
  
 16.2 This Financing Agreement and the Loan Documents executed and
delivered in connection therewith constitute the entire agreement between the Company and CIT; supersede any prior agreements; can be changed only by a writing signed by both the Company and CIT; and shall bind and benefit the Company and CIT and
their respective successors and assigns. 
  
 16.3 In no
event shall the Company, upon demand by CIT for payment of any indebtedness relating hereto, by acceleration of the maturity thereof, or otherwise, be obligated to pay interest and fees in excess of the amount permitted by law. Regardless of any
provision herein or in any agreement made in connection herewith, CIT shall never be entitled to receive, charge or apply, as interest on any indebtedness relating hereto, any amount in excess of the maximum amount of interest permissible under
applicable law. If CIT ever receives, collects or applies any such excess, it shall be deemed a partial repayment of principal and treated as such; and if principal is paid in full, any remaining excess shall be refunded to the Company. This
paragraph shall control every other provision hereof, the Loan Documents and of any other agreement made in connection herewith. 
  
 16.4 If any provision hereof or of any other agreement made in connection herewith is held to be illegal or unenforceable, such provision shall be
fully severable, and the remaining provisions of the applicable agreement shall remain in full force and effect and shall not be affected by such provision’s severance. Furthermore, in lieu of any such provision, there shall be added
automatically as a part of the applicable agreement a legal and enforceable provision as similar in terms to the severed provision as may be possible. 
  
 16.5 THE COMPANY AND CIT EACH HEREBY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING OUT OF THIS FINANCING AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED THEREUNDER. THE COMPANY HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF PROCESS AND CONSENTS TO SERVICE OF PROCESS BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED. IN NO EVENT WILL CIT BE LIABLE FOR LOST PROFITS OR
OTHER SPECIAL OR CONSEQUENTIAL DAMAGES. 
  
 16.6 Except
as otherwise herein provided, any notice or other communication required hereunder shall be in writing (provided that, any electronic communications from the Company with respect to any request, transmission, document, electronic signature,
electronic mail or 
  

 64 

 facsimile transmission shall be deemed binding on the Company for purposes of this Financing Agreement, provided further
that any such transmission shall not relieve the Company from any other obligation hereunder to communicate further in writing), and shall be deemed to have been validly served, given or delivered when hand delivered or sent by facsimile, or three
days after deposit in the United State mails, with proper first class postage prepaid and addressed to the party to be notified or to such other address as any party hereto may designate for itself by like notice, as follows: 
  
 (A) if to CIT, at: 
  
 The CIT Group/Business Credit, Inc. 
 2WO Wachovia Center, 25th Floor 
 301 South Tryon Street 
 Charlotte, NC 28202 
 Attn: Regional Credit Manager 
 Fax No.: (704) 339-2894 
  
 (B) if to the Company at: 
  
 Cybex International, Inc. 
 10 Trotter Drive 
 Medway, MA 02083 
 Attn: Arthur Hicks 
 Fax No: (508) 533-5799 
  
 With a courtesy copy of any material notice to the Company’s counsel at: 
  
 Archer & Greiner, PC 
 One Centennial Square 
 Haddenfield, NJ 08038 
 Attn: James H. Carll, Esquire 
 Fax No. (856) 795-0574 
  
 provided, however, that
the failure of CIT to provide the Company’s counsel with a copy of such notice shall not invalidate any notice given to the Company and shall not give the Company any rights, claims or defenses due to the failure of CIT to provide such
additional notice. 
  
 16.7 THE VALIDITY, INTERPRETATION AND
ENFORCEMENT OF THIS FINANCING AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, EXCEPT TO THE EXTENT THAT ANY OTHER LOAN DOCUMENT INCLUDES AN EXPRESS ELECTION TO BE GOVERNED BY THE LAWS OF ANOTHER
JURISDICTION. 
  

 65 

 IN WITNESS WHEREOF, the parties hereto have caused this Financing Agreement to be effective,
executed and accepted by their proper and duly authorized officers as of the date set forth above. 
  

							
	CYBEX INTERNATIONAL, INC.	 	THE CIT GROUP/
	 	 	 	 	BUSINESS CREDIT, INC.
				
	By:	 	  

	 	By:	 	  

	Title:	 	  

	 	Title:	 	  

  
 1366442 

 Exhibit A 
  
 TERM LOAN PROMISSORY NOTE 
  
 July     , 2004 
  
 $4,000,000 
  
 FOR VALUE RECEIVED, the undersigned, CYBEX INTERNATIONAL, INC., a New York corporation (the “Company”), promises to pay to the order of THE CIT
GROUP/BUSINESS CREDIT, INC. (herein “CIT”) at its office located at Two First Union Center, Charlotte, North Carolina 28230-0337 in lawful money of the United States of America and in immediately available funds, the principal amount of
FOUR MILLION DOLLARS ($4,000,000.00) as follows: 1) eleven (11) equal quarterly principal installments of $250,000.00, followed by 2) one (1) final principal installment of $1,250,000.00, whereof the first such installment shall be due and payable
on September 30, 2004 and subsequent installments shall be due and payable on the last Business Day of each calendar quarter thereafter until this Note is paid in full. 
  
 The Company further agrees to pay interest at said office, in like money, on the unpaid principal amount owing hereunder
from time to time from the date hereof on the date and at the rate specified in Section 8 of the Financing Agreement, dated July 16, 2003 between the Company and CIT (as amended as of the date hereof and as otherwise amended, supplemented, restated
or modified from time to time, the “Financing Agreement”). Capitalized terms used herein and defined in the Financing Agreement shall have the same meanings as set forth therein unless otherwise specifically defined herein.

  
 If any payment on this Note becomes due and payable on a day
other than a Business Day, the maturity thereof shall be extended to the next succeeding Business Day, and with respect to payments of principal, interest thereon shall be payable at the then applicable rate during such extension. 
  
 This Note is the Term Loan Promissory Note referred to in the Financing
Agreement, evidences the Term Loan thereunder, and is subject to, and entitled to, all provisions and benefits thereof and is subject to optional and mandatory prepayment, in whole or in part, as provided therein. 
  

 67 

 Upon the occurrence of any Event of Default specified in the Financing Agreement or upon termination of
the Financing Agreement, all amounts then remaining unpaid on this Note may become, or be declared to be, at the sole election of CIT, immediately due and payable as provided in the Financing Agreement. 
  

			
	CYBEX INTERNATIONAL, INC.
		
	By:	 	  

	Title:	 	  

  

 68 

 SCHEDULE 1 – COLLATERAL INFORMATION 

 

			
	CYBEX INTERNATIONAL, INC.	 	 
	STATE OF INCORPORATION OR FORMATION:	 	New York
	FEDERAL TAX I.D. NUMBER:	 	11-1731581
	CHIEF EXECUTIVE OFFICE:	 	10 Trotter Drive, Medway Ma 02053-2275
	COLLATERAL LOCATIONS:	 	10 Trotter Drive, Medway Ma 02053-2275
	 	 	151 24th Avenue NW, Owatonna MN
55060-1099
	 	 	728 N. Cedar Avenue, Owatonna MN 55060-1137
		
	CYBEX CAPITAL CORPORATION	 	 
	STATE OF INCORPORATION OR FORMATION:	 	New York
	FEDERAL TAX I.D. NUMBER:	 	11-3135906
	CHIEF EXECUTIVE OFFICE:	 	99 SW Wilshire, Suite 190, Portland Or 97225
	COLLATERAL LOCATIONS:	 	99 SW Wilshire, Suite 190, Portland Or 97225
		
	CYBEX INTERNNATIONAL UK LIMITED	 	 
	STATE OF INCORPORATION OR FORMATION:	 	England
	FEDERAL TAX I.D. NUMBER:	 	N/A
	 CHIEF EXECUTIVE OFFICE:
 Northampton
	 	 10 North Parkway Close, Round Spinney,
 NN38RQ UK

	 COLLATERAL LOCATIONS:
 Northampton
	 	 10 North Parkway Close, Round Spinney,
 NN38RQ UK

		
	TECTRIX FITNESS EQUIPMENT INC.	 	 
	STATE OF INCORPORATION OR FORMATION:	 	California
	FEDERAL TAX I.D. NUMBER:	 	33-0338901
	CHIEF EXECUTIVE OFFICE:	 	10 Trotter Drive, Medway Ma 02053-2275
	COLLATERAL LOCATIONS:	 	N/A DORMANT
		
	CYBEX FITNESS GERATE VERTRIEBS GMBH	 	 
	STATE OF INCORPORATION OR FORMATION:	 	Germany
	FEDERAL TAX I.D. NUMBER:	 	N/A
	CHIEF EXECUTIVE OFFICE:	 	N/A DORMANT
	COLLATERAL LOCATIONS:	 	N/A DORMANT

  

 69 

 SCHEDULE 2 
  

Litigation 
  
 Hot New Products, Inc. d/b/a Fitnesszone v. Trotter, Inc. and Cybex International, Inc., CV 98-JEO-1730-S, United States District Court for the Northern District of Alabama, Southern Division. The Hot New
Products suit was initiated in July 1997 as a breach of contract, fraud, unjust enrichment and recoupment action in Alabama state court. Amended in 1998 to include federal antitrust claims, including price discrimination and price conspiracy
violations. This action went to trial in January of 2004 and after a four day trial, the jury returned a verdict in favor of Cybex. Since that time the plaintiffs have filed a motion for a new trial which was fully briefed and argued at the end of
March 2004. We await a decision on this motion. 
  
 Gary J. Colassi v.
Cybex International, Inc., Civil Action 02-11909 RWZ, United States District Court for the District of Massachusetts. The Colassi matter was initiated in August 2002 and is a patent infringement action alleging that Cybex is infringing on
U.S. Patent 6,123,646 issued to Mr. Colassi. Plaintiff has not formulated a specific demand amount but has intimated that an adverse judgment would involve a significant royalty on all Cybex treadmills containing the Stableflex system as well as
punitive damages. We have been through the Markman hearing on this matter and a hearing on summary judgment was heard on June 15, 2004. We await the decision on our motion for summary judgment. In the event we need to go to trial, we estimate the
trial will take place in June of 2005. 
  
 Free Motion Fitness, Inc. f/k/a
Ground Zero Design Corporation v. Cybex International, Inc., 1:01CV00152 BSJ, United States District Court for the District of Utah. Action initiated by Free Motion in December 2001 alleging that Cybex is infringing on a patent owned by Free
Motion. In March 2004, the court issued a ruling on the briefed motions for summary judgment, granting Cybex’s motions in full. The court did not dismiss the counterclaims of Cybex and these will have to be adjudicated before Icon can appeal
the summary judgment ruling. 
  
 Gene Kirilla, II, et al v. Cybex
International, Inc., et al, Civil Division G.D. No. 1997-1725, Court of Common Pleas of Mercer County, Pennsylvania. Initiated in April 1997, the Kirila matter involved a claim of $12,000,000 on allegations of breach of covenant of good faith
and fair dealing, negligent misrepresentation and unjust enrichment. This matter went to trial in 2002 and the jury rendered a verdict for approximately $875,000 in favor of Mr. Kirilla. The Court issued its judgment in this matter in the amount of
$2,452,783. The judgment was comprised of the following: the original jury verdict amount of $872,000, prejudgment interest on the judgment of $369,000, a statutory penalty under the Pennsylvania Wage Payment and Collection Law of $218,000 and
attorneys fees of $993,783. Cybex had posted a letter of credit to secure this amount and has filed an appeal of the judgment in its entirety. 
  

 70 

 SCHEDULE 3 
  

			
	BENEFIT PLANS	  	PLANS
		
	Medical	  	90/70 Blue Care Elect PPO
	 	  	90/60 Blue Care Elect PPO
	 	  	Network Blue New England HMO
		
	 	  	Fallon HMO
		
	Vision	  	 
		
	Dental	  	Delta Premier Plan
		
	Continental Assurance Company	  	Group Life Insurance
	 	  	Supplemental Life Insurance
	 	  	Short Term Disability (Advice to Pay only)
	 	  	Long Term Disability
		
	Business Travel Accident Insurance	  	 
		
	Flexible Spending Accounts	  	Healthcare Flexible Spending
	 	  	Dependent Care Spending
		
	401(k)	  	Cybex Savings and Investment Plan

  
 Employee Assistance Programs

  
 Group Home/Auto Discount Insurance (employee voluntary) 
  
 COBRA Administrator 
  
 Payroll Service 
  
 Workman’s Compensation Insurance 
  

 71 

 Schedule 4 
  
 2003 EBITDA projections 
  

				
	 2ND
QUARTER 2003
	  	$	2,022,000
	 3RD
QUARTER 2003
	  	$	2,222,000
	 4TH
QUARTER 2003
	  	$	3,178,000
	 	  	
	

	 CUMULATIVE 9 MONTHS
	  	$	5,422,000
	 	  	
	

  

 72 

 SCHEDULE 5 
  
 Related Party Payments 
  
 1. Compensation payable to John Aglialoro as an employee of Cybex International, Inc., as authorized from time to time by the independent Directors of
Cybex International, Inc. Mr. Aglialoro’s current salary is at the rate of $360,000 per annum, subject to increase of up to 10% per year as authorized by the independent Directors of Cybex International, Inc. Any bonus payable to Mr. Aglialoro
with respect to any year will be authorized by the independent Directors of Cybex International, Inc. and will not exceed 50% of approved salary. 
  
 2. Fees (not to exceed $200,000) payable to UM Holdings Ltd under Services Agreement pursuant to which services of Chief Financial Officer are provided.

  
 3. Fees (not to exceed $100,000) payable to UM Holdings Ltd
under Services Agreement pursuant to which services of General Counsel are provided. 
  

 73 

 Exhibit B 
  
 SCHEDULE 2 
  
 Litigation 
  
 Hot New Products, Inc. d/b/a Fitnesszone v. Trotter, Inc. and Cybex International, Inc., CV 98-JEO-1730-S, United States District Court for the Northern District of Alabama, Southern Division. The Hot New
Products suit was initiated in July 1997 as a breach of contract, fraud, unjust enrichment and recoupment action in Alabama state court. Amended in 1998 to include federal antitrust claims, including price discrimination and price conspiracy
violations. This action went to trial in January of 2004 and after a four day trial, the jury returned a verdict in favor of Cybex. Since that time the plaintiffs have filed a motion for a new trial which was fully briefed and argued at the end of
March 2004. We await a decision on this motion. 
  
 Gary J. Colassi v.
Cybex International, Inc., Civil Action 02-11909 RWZ, United States District Court for the District of Massachusetts. The Colassi matter was initiated in August 2002 and is a patent infringement action alleging that Cybex is infringing on
U.S. Patent 6,123,646 issued to Mr. Colassi. Plaintiff has not formulated a specific demand amount but has intimated that an adverse judgment would involve a significant royalty on all Cybex treadmills containing the Stableflex system as well as
punitive damages. We have been through the Markman hearing on this matter and a hearing on summary judgment was heard on June 15, 2004. We await the decision on our motion for summary judgment. In the event we need to go to trial, we estimate the
trial will take place in June of 2005. 
  
 Free Motion Fitness, Inc. f/k/a
Ground Zero Design Corporation v. Cybex International, Inc., 1:01CV00152 BSJ, United States District Court for the District of Utah. Action initiated by Free Motion in December 2001 alleging that Cybex is infringing on a patent owned by Free
Motion. In March 2004, the court issued a ruling on the briefed motions for summary judgment, granting Cybex’s motions in full. The court did not dismiss the counterclaims of Cybex and these will have to be adjudicated before Icon can appeal
the summary judgment ruling. 
  
 Gene Kirilla, II, et al v. Cybex
International, Inc., et al, Civil Division G.D. No. 1997-1725, Court of Common Pleas of Mercer County, Pennsylvania. Initiated in April 1997, the Kirila matter involved a claim of $12,000,000 on allegations of breach of covenant of good faith
and fair dealing, negligent misrepresentation and unjust enrichment. This matter went to trial in 2002 and the jury rendered a verdict for approximately $875,000 in favor of Mr. Kirilla. The Court issued its judgment in this matter in the amount of
$2,452,783. The judgment was comprised of the following: the original jury verdict amount of $872,000, prejudgment interest on the judgment of $369,000, a statutory penalty under the Pennsylvania Wage Payment and Collection Law of $218,000 and
attorneys fees of $993,783. Cybex had posted a letter of credit to secure this amount and has filed an appeal of the judgment in its entirety. 
  

 74 

 The Company in the ordinary course of business is subject to product liability and similar litigation, all of which the
Company believes is covered by insurance. 
  
 Additionally, the Company has
received notice from Biosig Instruments, Inc. of allegations by Biosig that the heart rate monitors the Company uses in its treadmills infringe U.S. Patent 5,337,753 and Canadian Patent 2,033,014, both allegedly owned by Biosig. As the Company
purchases these monitors from a third party supplier, the Company believes itself to be indemnified for any damages The Company has received an opinion on non-infringement from patent counsel and believes the allegations to be baseless. 

 
 The descriptions for all matter provided on this Schedule (in italics) are provided for
informational purposes only and are not in any way intended to limit the scope of this Schedule. 
  

 75 

 Exhibit C 
  
 SCHEDULE 5 
  
 Related Party Payments 
  
 1. Compensation payable to John Aglialoro as an employee of Cybex International, Inc., authorized from time to time by the independent Directors of Cybex
International, Inc. Mr. Aglialoro’s current salary is at the rate of $360,000 per annum, subject to increase of up to 10% per year as authorized by the independent Directors of Cybex International, Inc. Any bonus payable to Mr. Aglialoro with
respect to any year will be authorized by the independent Directors of Cybex International, Inc. and will not exceed 50% of approved salary. 
  
 2. Fees (not to exceed $200,000) payable to UM Holdings Ltd under Services Agreement pursuant to which services of Chief Financial Officer are provided,
subject to increase of up to 10% per year as authorized by the independent Directors of Cybex International, Inc. 
  
 3. Fees (not to exceed $125,000) payable to UM Holdings Ltd under Services Agreement pursuant to which services of General Counsel are provided, subject
to increase of up to 10% per year as authorized by the independent Directors of Cybex International, Inc. 
  
 1398965v1 
  

 76

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