CREDIT AGREEMENT

EXECUTION COPY

CREDIT AGREEMENT

Dated November 10, 2005

by and among

DEVCON SECURITY HOLDINGS, INC.,

DEVCON SECURITY SERVICES CORP.

COASTAL SECURITY COMPANY,

COASTAL SECURITY SYSTEMS, INC. and

CENTRAL ONE, INC.

as Borrowers,

and

CAPITALSOURCE FINANCE LLC,

as Agent and Lender

TABLE OF CONTENTS

INDEX OF APPENDICES

CREDIT AGREEMENT

          This CREDIT AGREEMENT (this “ Agreement ”), dated November 10, 2005, is by and among DEVCON SECURITY HOLDINGS, INC. (f/k/a Devcon Security Services Corp.), a Florida corporation (“ Holdings ”), DEVCON SECURITY SERVICES CORP. (f/k/a Security Equipment Company, Inc.), a Delaware corporation (“ Services ”), COASTAL SECURITY COMPANY (f/k/a Coastal Acquisition Company), a Delaware corporation (“ Coastal ”), COASTAL SECURITY SYSTEMS, INC. (f/k/a Coastal Acquisition Corporation and Coastal Security Systems (Delaware), Inc.), a Delaware corporation (“ Systems ”), CENTRAL ONE, INC., Florida corporation (“ Central One ” and together with Holdings, Services, Coastal, and Systems each individually a “ Borrower ” and individually and collectively, together with any other Borrower who becomes party hereto from time to time pursuant to Section 6.11 , jointly and severally the “ Borrowers ”), CAPITALSOURCE FINANCE LLC, a Delaware limited liability company (in its individual capacity, “ CapitalSource” ), for itself, as a Lender, and as Agent for Lenders, and the other Lenders signatory hereto from time to time.

RECITALS

          A. Pursuant to the Coastal Purchase Agreement, as of the date of this Agreement, Holdings is acquiring all of the capital stock of Coastal, which is the sole owner of record and beneficially of all of the capital stock of Systems, and Systems is the sole owner of record and beneficially of all of the capital stock of Central One.

          B. The Borrowers have requested that Lenders make available a revolving credit facility to the Borrowers in the maximum principal amount of Seventy Million Dollars ($70,000,000) for the purpose of providing funds for Permitted Acquisitions, to refinance existing Indebtedness, for the purchase and generation of Alarm Contracts, for the issuance of letters of credit and for any other lawful purpose not prohibited by this Agreement.

          C. Lenders are willing to make advances to the Borrowers under such revolving credit facility upon the terms and conditions set forth herein.

          D. The Borrowers have agreed to secure all of their obligations under the Loan Documents by granting to Agent for the benefit of Agent and Lenders, a security interest in and first priority perfected lien upon substantially all of their existing and after-acquired personal and real property.

          E. Devcon International Corp., a Florida corporation (“ Parent ”), as sole shareholder of Holdings, is willing to pledge to Agent, for the benefit of Agent and Lenders, all of the Stock of Holdings as further security for the Borrowers’ obligations under the Loan Documents.

          F. This Background shall be construed as part of the Agreement.

          NOW, THEREFORE, in consideration of the premises and the mutual covenants hereinafter contained, and for other good and valuable consideration, the parties hereto agree as follows:

1. DEFINITIONS

          Capitalized terms used in the Loan Documents shall have (unless otherwise provided elsewhere in the Loan Documents) the following respective meanings and all references to Sections, Exhibits, Schedules or Annexes in the following definitions shall refer to Sections, Exhibits, Schedules or Annexes of or to the Agreement:

          “ Account Control Agreement ” means a tri-party account control agreement in the form of Exhibit 2.5(b)(1) hereto among a Borrower, the Agent and a Relationship Bank, or such other form as is acceptable to Agent in its Permitted Discretion.

          “ Account Debtor ” means any Person who is obligated to any Borrower under, with respect to, or on account of, an Account, Chattel Paper or General Intangible (including a payment intangible).

          “ Accounting Changes ” has the meaning ascribed thereto in Section 9.5 .

          “ Accounts ” means all “ accounts ,” as such term is defined in the UCC, now owned or hereafter acquired by any Borrower, including, without limitation, any Borrower’s accounts, rental agreements and other contract rights (including, without limitation, the Alarm Contracts and Material Contracts and all rights to payment thereunder), rights to payment and other forms of obligation for the payment of money to any Borrower, whether now existing or existing in the future, whether or not earned by performance, whether secured or unsecured and whether or not specifically sold or assigned to any Lender hereunder including, without limitation, all (a) accounts receivable (whether or not specifically listed on schedules furnished to Lenders), all accounts created by or arising from all of any Borrower’s sales or leases of goods, financial instruments, documents, permits or other items, or rendition of services, including funds transfer services, made under any of any Borrower’s trade names or styles, or through any of such Person’s subsidiaries or divisions, and all accounts acquired by assignment in the ordinary course of business including, without limitation, credit card receivables, drafts, and acceptances; (b) unpaid rights (including rescission, replevin, reclamation and stoppage in transit) relating to the foregoing or arising therefrom; (c) rights to any goods represented by any of the foregoing and all other supporting obligations therefor, including returned or repossessed goods; (d) reserves and credit balances held by any Borrower with respect to any such accounts receivable or Account Debtors; (e) guarantees, obligations of any Borrower to repay a portion of any purchase price or to replace any Alarm Contracts purchased by any Borrower, or to replace or collateral or any other supporting obligations for any of the foregoing; (f) insurance policies or rights relating to any of the foregoing; (g) all healthcare insurance receivables; and (h) all collateral security of any kind, now or hereafter in existence, given by any Account Debtor or other Person with respect to any of the foregoing.

          “ Acquisition Documents ” has the meaning given to such term in Section 7.1(h) .

          “ Acquisition Report ” has the meaning given to such term in Section 7.1(h) .

          “ Additional Commitment Fee ” has the meaning ascribed to it in Section 2.6(c) .

          “ Advance ” has the meaning given to such term in Section 2.1(a) .

          “ Affiliate ” means, with respect to any Person, (a) each Person that, directly or indirectly, owns or controls, whether beneficially, or as a trustee, guardian or other fiduciary, 15% or more of the Stock having ordinary voting power in the election of directors of such Person, (b) each Person that controls, is controlled by or is under common control with such Person, (c) each of such Person’s officers, directors, joint venturers and partners and (d) in the case of an individual, the immediate family members, spouses and lineal descendants of individuals who are Affiliates of such individual. For the purposes of this definition, “ control ” of a Person shall mean the possession, directly or indirectly, of the power to direct or cause the direction of its management or policies, whether through the ownership of voting securities, by contract or otherwise; provided , however , that the term “ Affiliate ” shall specifically exclude Agent and each Lender.

          “ Agent ” means CapitalSource in its capacity as Agent for Lenders or its successor appointed pursuant to Section 11.7 .

          “ Agreement ” means this Credit Agreement, as the same may be amended, supplemented, restated or otherwise modified from time to time.

          “ Alarm Contract ” means a written contract or agreement (including any contract or agreement acquired by any Borrower) between a Borrower and a Subscriber pursuant to which such Borrower provides regular and on-going electronic monitoring services, closed-circuit television and access control systems, maintenance, fire and/or other electronic security system related services to such Subscriber.

          “ Appendices ” means the schedules, exhibits, disclosure schedules and any other appendices to the Agreement, as further described herein.

          “ Applicable Base Rate Margin ” means the per annum interest rate margin from time to time in effect and payable in addition to the Base Rate applicable to the Advance, as determined by reference to Section 2.4(b) .

          “ Applicable LIBOR Margin ” means the per annum interest rate from time to time in effect and payable in addition to the LIBOR Rate applicable to the Advances, as determined by reference to Section 2.4(b) .

          “ Applicable Margins ” means collectively the Applicable Base Rate Margin and the Applicable LIBOR Margin.

          “ Assignment Agreement ” has the meaning ascribed to it in Section 11.1 .

          “ Assignment and Modification Agreement ” has the meaning ascribed to it in Section 3.1(y) .

          “ Attrition Ratio ” shall mean, for any period of determination, the ratio of the following (x) and (y), each without duplication, expressed as a percentage: (x) the Attrited RMR for the Measured Time Period, divided by (y) the average BOM RMR for the Measured Time Period. The resulting percentage shall then be annualized by multiplying it by the quotient of twelve (12) divided by the number of months in the Measured Time Period.

          “ Attrited RMR ” shall mean, without duplication, the sum of: (i) the RMR that was cancelled during the Measured Time Period; plus (ii) the RMR from all customers who were ninety (90) days or more past due from the applicable invoice date at the end of the Measured Time Period, less the RMR from all customers who were ninety (90) days or more past due from the applicable invoice date at the beginning of the Measured Time Period; provided that RMR that is subject to an account guarantee pursuant to a Permitted Acquisition as of the end of the Measured Time Period shall not be included in any such calculation, plus (iii) the RMR attributable to a customer account that, as of the date of determination, no longer satisfied the definition of Slow Pay RMR; minus (iv) the RMR of a Qualified Alarm Contract entered into with a Subscriber for the same premises as was previously covered by a Qualified Alarm Contract with Borrower that had been cancelled; minus (v) RMR of Qualified Alarm Contracts received as replacement Qualified Alarm Contracts pursuant to a dealer guaranty or similar agreement.

          “ Bank Accounts ” has the meaning ascribed to it in Section 2.5 .

          “ Bankruptcy Code ” means the provisions of Title 11 of the United States Code, 11 U.S.C. §§ 101 et seq .

          “ Base Rate ” means, for any day, a floating rate equal to the higher of (i) the rate publicly quoted from time to time by The Wall Street Journal as the “ prime rate ” (or, if The Wall Street Journal ceases quoting a prime rate, the highest per annum rate of interest published by the Federal Reserve Board in Federal Reserve statistical release H.15 (519) entitled “ Selected Interest Rates ” as the Bank prime loan rate or its equivalent), and (ii) the Federal Funds Rate plus 50 basis points (0.50%) per annum. Each change in any interest rate provided for in the Agreement based upon the Base Rate shall take effect at the time of such change in the Base Rate.

          “ Base Rate Loan ” means a Loan or portion thereof bearing interest by reference to the Base Rate.

          “ BOM RMR ” shall mean the amount equal to the total Qualified RMR, as determined on the first day of each Fiscal Month.

          “ Borrower ” and “ Borrowers ” have the meanings ascribed thereto in the preamble to the Agreement.

          “ Borrower Pledge Agreement ” means the Pledge Agreement of even date herewith executed by the Borrowers in favor of Agent, on behalf of itself and Lenders, pledging all Stock of Services and any other Subsidiaries of any Borrower, and all Intercompany Notes, if any, owing to or held by any of them.

          “ Borrowing Availability ” means, as of any date of determination, (a) the Borrowing Base, less (b) the principal amount of Loans then outstanding.

          “ Borrowing Base ” means the lesser of (a) the Total Borrowing Availability, or (b) the aggregate amount of (i) the product of twenty-six (26) times the Qualified Retail RMR, plus (ii) the product of ten (10) times the Qualified Wholesale RMR, minus (iii) $500,000.

          “ Borrowing Base Certificate ” has the meaning ascribed to it in Section 5.1(b)(ii)(D) .

          “ Bridge Loan ” means that certain loan by CapitalSource to the Borrowers in the amount of Eight Million Dollars ($8,000,000) pursuant to that certain Bridge Loan Agreement, between CapitalSource and the Borrowers, dated as of the date hereof.

          “ Bridge Loan Documents ” means the Bridge Loan Agreement evidencing the Bridge Loan and all the other agreements, instruments, documents and certificates described in such agreement that are executed and/or delivered by Borrowers to CapitalSource in connection therewith.

          “ Business Day ” means any day that is not a Saturday, a Sunday or a day on which banks are required or permitted to be closed in the State of Maryland and in reference to LIBOR Loans shall mean any such day that is also a LIBOR Business Day.

          “ Capital Expenditures ” means, with respect to any Person, all expenditures (by the expenditure of cash or the incurrence of Indebtedness) by such Person during any measuring period for any fixed assets or improvements or for replacements, substitutions or additions thereto, that have a useful life of more than one year and that are required to be capitalized under GAAP but excluding expenditures for repairs or replacements of fixed assets or improvements thereto, to the extent paid for with insurance proceeds or other recoveries from third parties in respect thereof, and excluding the purchase price payable in connection with any Permitted Acquisition.

          “ Capital Lease ” means, with respect to any Person, any lease of any property (whether real, personal or mixed) by such Person as lessee that, in accordance with GAAP, would be required to be classified and accounted for as a capital lease on a balance sheet of such Person.

          “ Capital Lease Obligation ” means, with respect to any Capital Lease of any Person, the amount of the obligation of the lessee thereunder that, in accordance with GAAP, would appear on a balance sheet of such lessee in respect of such Capital Lease.

          “ CapitalSource ” means CapitalSource Finance LLC, a Delaware limited liability company, and its successors and assigns.

          “ Cash Management Systems ” has the meaning ascribed to it in Section 2.5 .

          “ Change of Control ” means any event, transaction or occurrence as a result of which (a) Parent ceases to own and control all of the economic and voting rights associated with all of the outstanding common capital Stock of Holdings, (b) Holdings ceases to own and control all of the economic and voting rights associated with all of the outstanding common capital Stock of Services or (c) any Borrower ceases to own and control all of the economic and voting rights associated with all of the outstanding capital Stock of any of its Subsidiaries other than with respect to an asset sale or disposition expressly permitted by this Agreement.

          “ Change of Management ” means if (a) Stephen Ruzika no longer holds the position of President of each Borrower, (b) neither John Danneberg nor Keith Godsey holds the position of Vice-President of each Borrower, or (c) any material diminution occurs in the powers, duties or responsibilities of either Stephen Ruzika as President of each Borrower, or John Danneberg and Keith Godsey, as Vice-President of each Borrower, and, in the event of (a), (b) or (c) occurring, any such individual is not replaced with a suitable individual and in a manner satisfactory to Agent in its reasonable discretion within one hundred eighty (180) days following the date on which he ceases to hold such position or such material diminution occurs.

          “ Charges ” means all federal, state, county, city, municipal, local, foreign or other governmental levies, assessments, charges, liens, claims or encumbrances (other than Taxes) upon or relating to (a) the Collateral, (b) the Obligations, (c) the employees, payroll, income or gross receipts of any Borrower, (d) any Borrower’s ownership or use of any properties or other assets, or (e) any other aspect of any Borrower’s business.

          “ Chattel Paper ” means any “ chattel paper ,” as such term is defined in the UCC, including electronic chattel paper, now owned or hereafter acquired by any Borrower, wherever located.

          “ Coastal ” means Coastal Security Company, a Delaware corporation.

          “ Coastal Purchase Agreement ” means that purchase agreement, dated as of the date hereof, pursuant to which Holdings is acquiring the capital stock of Coastal from the stockholders of Coastal.

          “ Closing Date ” means November 10, 2005.

          “ Code ” means the Internal Revenue Code of 1986, as amended, any successor thereto and all regulations promulgated thereunder.

          “ Collateral ” means the property covered by the Security Agreement, the Mortgages and the other Collateral Documents and any other property, real or personal, tangible or intangible, now existing or hereafter acquired, that may at any time be or become subject to a security interest or Lien in favor of Agent, on behalf of itself and Lenders, to secure the Obligations.

          “ Collateral Assignment of Life Insurance ” means an assignment, in form and substance satisfactory to Agent, which assigns to Agent for the ratable benefit of the Lenders, the Life Insurance Policy as Collateral for the Obligations.

          “ Collateral Assignment of Telephone Numbers ” has the meaning ascribed to it in Section 3.1(ee) .

          “ Collateral Documents ” means the Security Agreement, the Pledge Agreements, the Mortgages, any Patent Security Agreement, any Trademark Security Agreement, any Copyright Security Agreement, the Collateral Assignment of Life Insurance, the Collateral Assignment of Telephone Numbers, any Account Control Agreement, any Lockbox Agreement, any agreement pursuant to which any Material Contract or rights thereunder are being assigned

and all similar agreements entered into guaranteeing payment of, or granting a Lien upon property as security for payment of, the Obligations.

          “ Collateral Reports ” has the meaning ascribed to it in Section 5.1(b) .

          “ Collection Account ” means such account as may be specified in writing by Agent to the Borrowers for payment of any amounts due under any Loan Document.

          “ Commitment ” means (a) as to any Lender, such Lender’s Commitment as set forth on Schedule I to the Agreement or in the most recent Assignment Agreement executed by such Lender and (b) as to all Lenders, the aggregate of all Lenders’ Commitments, which aggregate commitment shall be Seventy Million ($70,000,000) on the Closing Date, as to each of clauses (a) and (b) , as such Commitment may be increased, reduced, amortized or adjusted from time to time in accordance with the Agreement. Upon Borrowers’ request and at the approval of the Requisite Lenders, the Commitment may be increased up to an amount equal to One Hundred Million Dollars ($100,000,000.00) in accordance with Section 2.15 .

          “ Commitment Termination Date ” means the earliest of (a) November 9, 2008, (b) the date of termination of Lenders’ obligations to make Advances or permit existing Loans to remain outstanding pursuant to Section 10.2(b) , and (c) the date of prepayment in full by the Borrowers of the Loans and the permanent reduction of the Commitments to zero dollars ($0).

          “ Compliance Certificate ” has the meaning ascribed to it in Section 5.1(a)(iv) .

          “ Concentration Account ” has the meaning ascribed to it in Section 2.5 (b) .

          “ Contracts ” means all “ contracts ,” as such term is defined in the UCC, now owned or hereafter acquired by any Borrower, in any event, including all contracts, undertakings, or agreements (other than rights evidenced by Chattel Paper, Documents or Instruments) in or under which any Borrower may now or hereafter have any right, title or interest, including any agreement relating to the terms of payment or the terms of performance of any Account.

          “ Control Letter ” means a letter agreement between Agent and, as applicable, (i) the issuer of uncertificated securities with respect to uncertificated securities in the name of any Borrower, (ii) a securities intermediary with respect to securities, whether certificated or uncertificated, securities entitlements and other financial assets held in a securities account in the name of any Borrower, (iii) a futures commission merchant or clearing house, as applicable, with respect to commodity accounts and commodity contracts held by any Borrower, whereby, among other things, the issuer, securities intermediary or futures commission merchant limits any security interest in the applicable financial assets in a manner reasonably satisfactory to Agent, acknowledges the Lien of Agent, on behalf of itself and Lenders, on such financial assets, and agrees to follow the instructions or entitlement orders of Agent without further consent by the affected Borrower.

          “ Copyright License ” means any and all rights now owned or hereafter acquired by any Borrower under any written agreement granting any right to use any Copyright or Copyright registration.

          “ Copyright Security Agreements ” means any Copyright Security Agreements made in favor of Agent, on behalf of itself and Lenders, by each applicable Borrower.

          “ Copyrights ” means all of the following now owned or hereafter adopted or acquired by any Borrower: (a) all copyrights and General Intangibles of like nature (whether registered or unregistered), all registrations and recordings thereof, and all applications in connection therewith, including all registrations, recordings and applications in the United States Copyright Office or in any similar office or agency of the United States, any state or territory thereof, or any other country or any political subdivision thereof, and (b) all reissues, extensions or renewals thereof.

          “ Debt Service ” means, with respect to Holdings and its consolidated Subsidiaries, for any fiscal period, an amount equal to the sum of (a) Interest Expense for such period which is required to be paid in cash, and (b) the regularly scheduled principal payments of any outstanding Indebtedness during such period.

          “ Default ” means any event that, with the passage of time or notice or both, would, unless cured or waived, become an Event of Default.

          “ Default Rate ” has the meaning ascribed to it in Section 2.4(e) .

          “ Deposit Accounts ” means all “ deposit accounts ,” as such term is defined in the UCC, now or hereafter held in the name of any Borrower.

          “ Disclosure Schedules ” means the Disclosure Schedules prepared by the Borrowers and referenced herein as Disclosure Schedules to this Agreement, as delivered to Agent on or before the Closing Date (as may be amended from time to time with the consent of the Agent).

          “ Documents ” means any “ documents ,” as such term is defined in the UCC, now owned or hereafter acquired by any Borrower, wherever located.

          “ Dollars ” or “ $ ” means lawful currency of the United States of America.

          “ EBITDA ” means, with respect to Holdings and its consolidated Subsidiaries, for any applicable period, without duplication, an amount equal to (a) consolidated net income for such period, determined in accordance with GAAP, minus (b) the sum of (i) income tax credits, (ii) interest income, (iii) income or gain from extraordinary items for such period, (iv) any aggregate net gain (or net loss) during such period arising from the sale, exchange or other disposition of capital assets (including any fixed assets, whether tangible or intangible, all inventory sold in conjunction with the disposition of fixed assets and all securities), (v) Restricted Payments, and (vi) any other non-cash gains that have been added in determining consolidated net income, in each case to the extent included in the calculation of consolidated net income for such period in accordance with GAAP, but without duplication, plus (c) the sum of (i) any provision for income taxes, (ii) Interest Expense, including fees in respect of any Indebtedness, (iii) loss from extraordinary items for such period, (iv) depreciation and amortization for such period, and (v) any other adjustments agreed to by Agent in its sole discretion; provided that, for covenant compliance purposes, EBITDA shall be calculated to

include (or exclude), on a pro forma basis, cash flow relating to the acquisition (or disposition/cancellation) of Alarm Contracts during such reporting period (the “ Pro Forma Cash Flow Adjustment ”). Subject to the review and consent of the Agent, such Pro Forma Cash Flow Adjustment shall be determined by multiplying (a) the combined RMR of such Alarm Contracts over the applicable period by (b) the actual EBITDA Margin for such period (calculated without reference to this proviso).

          “ EBITDA Margin ” means (A) EBITDA divided by (B) Total Revenue.

          “ Environmental Laws ” means all applicable federal, state, local and foreign laws, statutes, ordinances, codes, rules, standards and regulations, now or hereafter in effect, and any applicable judicial or administrative interpretation thereof, including any applicable judicial or administrative order, consent decree, order or judgment, imposing liability or standards of conduct for or relating to the regulation and protection of the environment, natural resources (including ambient air, surface water, groundwater, wetlands, land surface or subsurface strata, wildlife, aquatic species and vegetation), and human health and safety to the extent affected by any Hazardous Material. Environmental Laws include the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (42 U.S.C. §§ 9601 et seq.) (“CERCLA”); the Hazardous Materials Transportation Authorization Act of 1994 (49 U.S.C. §§ 5101 et seq.); the Federal Insecticide, Fungicide, and Rodenticide Act (7 U.S.C. §§ 136 et seq.); the Solid Waste Disposal Act (42 U.S.C. §§ 6901 et seq.); the Toxic Substance Control Act (15 U.S.C. §§ 2601 et seq.); the Clean Air Act (42 U.S.C. §§ 7401 et seq.); the Federal Water Pollution Control Act (33 U.S.C. §§ 1251 et seq.); the Occupational Safety and Health Act (29 U.S.C. §§ 651 et seq.) to the extent relating to exposure to any Hazardous Material; and the Safe Drinking Water Act (42 U.S.C. §§ 300(f) et seq.), and any and all regulations promulgated thereunder, and all analogous state, local and foreign counterparts or equivalents and any transfer of ownership notification or approval statutes relating to the foregoing.

          “ Environmental Liabilities ” means, with respect to any Borrower, all material liabilities, obligations, responsibilities, response, remedial and removal costs, investigation and feasibility study costs, capital costs, operation and maintenance costs, losses, damages, punitive damages, property damages, natural resource damages, consequential damages, treble damages, costs and expenses (including all reasonable fees, disbursements and expenses of counsel, experts and consultants), fines, penalties, sanctions and interest incurred as a result of or related to any claim, suit, action, investigation, proceeding or demand by any Person, whether based in contract, tort, implied or express warranty, strict liability, criminal or civil statute or common law, that arise under or relate to any Environmental Laws, Environmental Permits, or in connection with any Release or presence of a Hazardous Material whether on, at, in, under, from or about or in the vicinity of any real or personal property.

          “ Environmental Permits ” means all material permits, licenses, authorizations, certificates, approvals or registrations required by any Governmental Authority under any Environmental Laws.

          “ Equipment ” means all “ equipment ,” as such term is defined in the UCC, now owned or hereafter acquired by any Borrower, wherever located and, in any event, including all any Borrower’s machinery and equipment, including processing equipment, conveyors, machine

tools, data processing and computer equipment, including embedded software and peripheral equipment and all engineering, processing and manufacturing equipment, office machinery, furniture, materials handling equipment, tools, attachments, accessories, automotive equipment, trailers, trucks, forklifts, molds, dies, stamps, motor vehicles, rolling stock and other equipment of every kind and nature, trade fixtures and fixtures not forming a part of real property, together with all additions and accessions thereto, replacements therefor, all parts therefor, all substitutes for any of the foregoing, fuel therefor, and all manuals, drawings, instructions, warranties and rights with respect thereto, and all products and proceeds thereof and condemnation awards and insurance proceeds with respect thereto.

          “ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and any regulations promulgated thereunder.

          “ ERISA Affiliate ” means, with respect to any Borrower, any trade or business (whether or not incorporated) that, together with such Borrower, are treated as a single employer within the meaning of Sections 414(b) , (c) , (m) or (o) of the Code.

          “ ERISA Event ” means, with respect to any Borrower or any ERISA Affiliate, (a) any event described in Section 4043(c) of ERISA with respect to a Title IV Plan for which the PBGC has not waived the thirty day notice requirement; (b) the withdrawal of any Borrower or ERISA Affiliate from a Title IV Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer, as defined in Section 4001(a)(2) of ERISA; (c) the complete or partial withdrawal of any Borrower or any ERISA Affiliate from any Multiemployer Plan; (d) the filing of a notice of intent to terminate a Title IV Plan or the treatment of a plan amendment as a termination under Section 4041 of ERISA; (e) the institution of proceedings to terminate a Title IV Plan or Multiemployer Plan by the PBGC; (f) the failure by any Borrower or ERISA Affiliate to make when due required contributions to a Multiemployer Plan or Title IV Plan unless such failure is cured within thirty (30) days; (g) any other event or condition that could reasonably be expected to constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Title IV Plan or Multiemployer Plan or for the imposition of liability under Section 4069 or 4212(c) of ERISA; (h) the termination of a Multiemployer Plan under Section 4041A of ERISA or the reorganization or insolvency of a Multiemployer Plan under Section 4241 or 4245 of ERISA; or (i) the loss of a Qualified Plan’s qualification or tax exempt status; or (j) the termination of a Plan described in Section 4064 of ERISA.

          “ ESOP ” means a Plan that is intended to satisfy the requirements of Section 4975(e)(7) of the Code.

          “ Event of Default ” has the meaning ascribed to it in Section 10.1 .

          “ Excluded Taxes ” means with respect to Agent, any Lender or any other recipient of any payment to be made by or on account of any obligation of any Borrower hereunder or any other Loan Document:

          (a) taxes imposed on or measured by its overall net income by the United States;

          (b) taxes imposed on or measured by its overall net income or profits (however denominated) and franchise taxes imposed on or measured by its income, earnings or retained earnings by (i) the state or foreign jurisdiction (or any political subdivision thereof) in or under the laws of which it is organized or any political subdivision thereof, or (ii) the state or foreign jurisdiction (or any political subdivision thereof) of its principal office, applicable lending office or in which it is “ doing business ” or any political subdivision thereof;

          (c) any branch profits taxes imposed by the United States or any similar tax imposed by any other jurisdiction in which its principal office or applicable lending office is located or in which it is “ doing business ,” or any political subdivision thereof; and

          (d) in the case of a Foreign Lender, any withholding tax that is imposed on amounts payable to such Foreign Lender at the time such Foreign Lender becomes a party hereto (or designates a new lending office) or is attributable to such Foreign Lender’s failure or inability (other than as a result of a change in law) to comply with Section 2.12(c) , except to the extent that such Foreign Lender (or its assignor, if any) was entitled, at the time of designation of a new lending office (or assignment), to receive additional amounts from any Borrower with respect to such withholding tax pursuant to Section 2.12(a) .

          “ Existing Increase Lender ” has the meaning ascribed to it in Section 2.15(b) .

          “ Fair Labor Standards Act ” means the Fair Labor Standards Act, 29 U.S.C. §201 et seq.

          “ Federal Funds Rate ” means, for any day, a floating rate equal to the weighted average of the rates on overnight federal funds transactions among members of the Federal Reserve System, as determined by Agent, which determination shall be final, binding and conclusive (absent manifest error).

          “ Federal Reserve Board ” means the Board of Governors of the Federal Reserve System.

          “ Fee Letter ” means that certain Fee Letter, dated the date hereof, between CapitalSource and Borrowers, as amended in writing from time to time.

          “ Fees ” means any and all fees of any nature payable to Agent or any Lender pursuant to the Fee Letter, this Agreement or any of the other Loan Documents.

          “ Financial Covenants ” means the financial covenants set forth in Section 9 .

          “ Financial Statements ” means the consolidated income statements, statements of cash flows and balance sheets of Holdings delivered in accordance with Section 4.4 and Section 5.1 .

          “ Fiscal Month ” means any of the monthly accounting periods of the Borrowers.

          “ Fiscal Quarter ” means any of the quarterly accounting periods of the Borrowers, ending on March 31, June 30, September 30 and December 31 of each year.

          “ Fiscal Year ” means any of the annual accounting periods of the Borrowers ending on December 31 of each year.

          “ Fixed Charge Coverage Ratio ” means, for any fiscal period, the ratio of (a) EBITDA in such period, to (b) Fixed Charges for such period.

          “ Fixed Charges ” means, for any fiscal period, the sum, for Holdings and its consolidated Subsidiaries for such period, of: (a) income taxes required to be paid in such period; (b) Capital Expenditures to the extent paid during such period (excluding the financed portion thereof); and (c) Debt Service paid.

          “ Fixtures ” means all “ fixtures ,” as such term is defined in the UCC, now owned or hereafter acquired by any Borrower.

          “ Foreign Lender ” means any Lender that is not a “ United States person ” (as such term is defined in Code Section 7701(a)(30)) .

          “ GAAP ” means generally accepted accounting principles in the United States of America, consistently applied, as such term is further defined in Section 9 of the Agreement.

          “ General Intangibles ” means “ general intangibles ,” as such term is defined in the UCC, now owned or hereafter acquired by any Borrower, including all right, title and interest that such Borrower may now or hereafter have in or under any Contract, all payment intangibles, Subscriber lists, Licenses, Copyrights, Trademarks, Patents, and all applications therefor and reissues, extensions or renewals thereof, rights in Intellectual Property, interests in partnerships, joint ventures and other business associations, licenses, permits, copyrights, trade secrets, proprietary or confidential information, inventions (whether or not patented or patentable), technical information, procedures, designs, knowledge, know-how, software, data bases, data, skill, expertise, experience, processes, models, drawings, materials and records, goodwill (including the goodwill associated with any Trademark or Trademark License), all rights and claims in or under insurance policies (including insurance for fire, damage, loss and casualty, whether covering personal property, real property, tangible rights or intangible rights, all liability, life, key man and business interruption insurance, and all unearned premiums), uncertificated securities, choses in action, deposit, checking and other bank accounts, rights to receive tax refunds and other payments, rights to receive dividends, distributions, cash, Instruments and other property in respect of or in exchange for pledged Stock and Investment Property, rights of indemnification, all books and records, correspondence, credit files, invoices and other papers, including without limitation all tapes, cards, computer runs and other papers and documents in the possession or under the control of such Borrower or any computer bureau or service company from time to time acting for such Borrower.

          “ Goods ” means any “ goods ” as defined in the UCC, now owned or hereafter acquired by any Borrower, wherever located, including embedded software to the extent included in “ goods ” as defined in the UCC, manufactured homes, standing timber that is cut and removed for sale and unborn young of animals.

          “ Governmental Approvals ” means any and all licenses, approvals, consents, qualifications and authorizations from any Governmental Authority.

          “ Governmental Authority ” means any nation or government, any state or any political subdivision thereof (including, without limitation, any district, city, township, municipality or similar jurisdiction and any quasi governmental association or institution), and any agency, department or other entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government.

          “ Guaranty Obligations ” means, as to any Person, any obligation of such Person guaranteeing, providing comfort or otherwise supporting any Indebtedness, lease, dividend, or other obligation (“ primary obligation ”) of any other Person (the “ primary obligor ”) in any manner, including any obligation or arrangement of such Person to (a) purchase or repurchase any such primary obligation, (b) advance or supply funds (i) for the purchase or payment of any such primary obligation or (ii) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency or any balance sheet condition of the primary obligor, (c) purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation, (d) protect the beneficiary of such arrangement from loss (other than product warranties given in the ordinary course of business) or (e) indemnify the owner of such primary obligation against loss in respect thereof. The amount of any Guaranty Obligations at any time shall be deemed to be an amount equal to the lesser at such time of (x) the stated or determinable amount of the primary obligation in respect of which such Guaranty Obligations are incurred and (y) the maximum amount for which such Person may be liable pursuant to the terms of the instrument embodying such Guaranty Obligations, or, if not stated or determinable, the maximum reasonably anticipated liability (assuming full performance) in respect thereof.

          “ Hazardous Material ” means any substance, material or waste that is regulated by, or forms the basis of liability now or hereafter under, any Environmental Laws, including any material or substance that is (a) defined as a “ solid waste ,” “ hazardous waste ,” “ hazardous material ,” “ hazardous substance ,” “ extremely hazardous waste ,” “ restricted hazardous waste ,” “ pollutant ,” “ contaminant ,” “ hazardous constituent ,” “ special waste ,” “ toxic substance ” or other similar term or phrase under any Environmental Laws, or (b) petroleum or any fraction or by-product thereof, asbestos, polychlorinated biphenyls (PCB’s), or any radioactive substance.

          “ Holdback Liabilities ” means any obligations required to be paid by any Borrower in connection with a Permitted Acquisition which are reserved for a period of time following closing in connection with Alarm Contracts purchased in such Permitted Acquisition which are cancelled, terminated or otherwise determined not to comply with the terms of the related acquisition agreement.

          “ Indebtedness ” means, with respect to any Person, without duplication (a) all indebtedness of such Person for borrowed money or for the deferred purchase price of property payment for which is deferred ninety (90) days or more, but excluding obligations to trade creditors incurred in the ordinary course of business that are unsecured and not overdue by more than ninety (90) days, (b) all reimbursement and other obligations with respect to letters of credit, bankers’ acceptances and performance, surety and appeal bonds, whether or not matured, (c) all obligations evidenced by notes, bonds, debentures or similar instruments, (d) all indebtedness created or arising under any conditional sale or other title retention agreement with

respect to property acquired by such Person (even though the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such property), (e) all Capital Lease Obligations and the present value (discounted at the Base Rate as in effect on the date of determination) of future rental payments under all synthetic leases, (f) all net obligations of such Person under commodity purchase or option agreements or other commodity price hedging arrangements, in each case whether contingent or matured, (g) all net obligations of such Person under any foreign exchange contract, currency swap agreement, interest rate swap, cap or collar agreement or other similar agreement or arrangement designed to alter the risks of that Person arising from fluctuations in currency values or interest rates, in each case whether contingent or matured, (h) all Indebtedness referred to above secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien upon or in property or other assets (including accounts and contract rights) owned by such Person, even though such Person has not assumed or become liable for the payment of such Indebtedness, (i) the Obligations, and (j) any Holdback Liabilities.

          “ Indemnified Liabilities ” has the meaning ascribed to it in Section 2.10(a) .

          “ Indemnified Person ” has the meaning ascribed to it in Section 2.10(a) .

          “ Indemnified Taxes ” means Taxes other than Excluded Taxes and Other Taxes.

          “ Initial Advance ” has the meaning ascribed to it in Section 3.1(g) .

          “ Instruments ” means all “ instruments ,” as such term is defined in the UCC, now owned or hereafter acquired by any Borrower, wherever located, and, in any event, including all certificated securities, all certificates of deposit, and all promissory notes and other evidences of indebtedness, other than instruments that constitute, or are a part of a group of writings that constitute, Chattel Paper.

          “ Intellectual Property ” means any and all Licenses, Patents, Copyrights, Trademarks, and the goodwill associated with such Trademarks.

          “ Intercompany Notes ” has the meaning ascribed to it in Section 7.3(a)(iv) .

          “ Interest Expense ” means, for any fiscal period, interest expense (whether cash or non-cash) and fees of Holdings and its consolidated Subsidiaries in respect of Indebtedness determined in accordance with GAAP for the relevant period, including interest expense and fees with respect to any Total Debt and interest expense for the relevant period that has been capitalized on the balance sheet of Holdings and its consolidated Subsidiaries; provided that, Interest Expense is not intended to include any of the up-front fees required to be paid pursuant to the Fee Letter on or prior to the Closing Date that might otherwise be treated as interest expense in accordance with GAAP.

          “ Interest Payment Date ” means (a) as to any Base Rate Loan, the first Business Day of each calendar month to occur while such Loan is outstanding, and (b) as to any LIBOR Loan, the last day of the applicable LIBOR Period; provided , that in the case of any LIBOR Period greater than three months in duration, interest shall be payable at three month intervals and on the last day of such LIBOR Period; and provided further that, in addition to the foregoing,

each of (x) the date upon which all of the Commitments have been terminated and the Loans have been paid in full and (y) the Termination Date shall be deemed to be an “ Interest Payment Date ” with respect to any interest that has then accrued under the Agreement.

          “ Inventory ” means any “ inventory ,” as such term is defined in the UCC, now owned or hereafter acquired by any Borrower, wherever located, and in any event including inventory, merchandise, goods and other personal property that are held by or on behalf of any Borrower for sale or lease or are furnished or are to be furnished under a contract of service, or that constitute raw materials, work in process, finished goods, returned goods, supplies or materials of any kind, nature or description used or consumed or to be used or consumed in any Borrower’s business or in the processing, production, packaging, promotion, delivery or shipping of the same, including all supplies and embedded software.

          “ Investment Property ” means all “ investment property ” as such term is defined in the UCC now owned or hereafter acquired by any Borrower, wherever located, including (i) all securities, whether certificated or uncertificated, including stocks, bonds, interests in limited liability companies, partnership interests, treasuries, certificates of deposit, and mutual fund shares; (ii) all securities entitlements of any Borrower, including the rights of such Borrower to any securities account and the financial assets held by a securities intermediary in such securities account and any free credit balance or other money owing by any securities intermediary with respect to that account; (iii) all securities accounts of any Borrower; (iv) all commodity contracts of any Borrower; and (v) all commodity accounts held by any Borrower.

          “ IRS ” means the Internal Revenue Service.

          “ Lenders ” means CapitalSource Finance, the other Lenders named on the signature pages of the Agreement, and, if any such Lender shall decide to assign all or any portion of the Obligations, such term shall include any assignee of such Lender, so long as any such Person holds any Commitment or Loans pursuant to the terms of this Agreement.

          “ Letter-of Credit Rights ” means “ letter-of-credit rights ” as such term is defined in the UCC, now owned or hereafter acquired by any Borrower, including rights to payment or performance under a letter of credit, whether or not such Borrower, as beneficiary, has demanded or is entitled to demand payment or performance.

          “ LIBOR Business Day ” means a Business Day on which banks in the City of London are generally open for interbank or foreign exchange transactions.

          “ LIBOR Loan ” means a Loan or any portion thereof bearing interest by reference to the LIBOR Rate.

          “ LIBOR Period ” means, with respect to any LIBOR Loan, each period commencing on a LIBOR Business Day selected by the Borrowers pursuant to this Agreement and ending thirty, sixty or ninety days thereafter, as selected by the Borrowers’ irrevocable notice to Agent as set forth in Section 2.4(f) ; provided , that the foregoing provision relating to LIBOR Periods is subject to the following:

     (a) if any LIBOR Period would otherwise end on a day that is not a LIBOR Business Day, such LIBOR Period shall be extended to the next succeeding LIBOR Business Day unless the result of such extension would be to carry such LIBOR Period into another calendar month in which event such LIBOR Period shall end on the immediately preceding LIBOR Business Day;

     (b) any LIBOR Period that would otherwise extend beyond the Maturity Date shall end on such date;

     (c) any LIBOR Period that begins on the last LIBOR Business 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 LIBOR Period) shall end on the last LIBOR Business Day of a calendar month;

     (d) the Borrowers shall select LIBOR Periods so as not to require a payment or prepayment of any LIBOR Loan during a LIBOR Period for such Loan; and

     (e) the Borrowers shall select LIBOR Periods so that there shall be no more than 8 separate LIBOR Loans in existence at any one time.

          “ LIBOR Rate ” means for each LIBOR Period, a rate of interest determined by Agent equal to:

     (a) the offered rate for deposits in United States Dollars for the applicable LIBOR Period that appears on Telerate Page 3750 as of 11:00 a.m. (London time), on the second full LIBOR Business Day next preceding the first day of such LIBOR Period (unless such date is not a Business Day, in which event the next succeeding Business Day will be 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 reserve requirements in effect on the day that is two (2) LIBOR Business Days prior to the beginning of such LIBOR Period (including basic, supplemental, marginal and emergency reserves under any regulations of the Federal Reserve Board or other Governmental Authority having jurisdiction with respect thereto, as now and from time to time in effect) for Eurocurrency funding (currently referred to as “ Eurocurrency Liabilities ” in Regulation D of the Federal Reserve Board) that are required to be maintained by a member bank of the Federal Reserve System.

     If such interest rates shall cease to be available from Telerate News Service, the LIBOR Rate shall be determined from such financial reporting service or other information as shall be mutually acceptable to Agent and the Borrowers.

          “ License ” means any Copyright License, Patent License, Trademark License or other license of rights or interests now held or hereafter acquired by any Borrower.

          “ Lien ” means any mortgage or deed of trust, pledge, hypothecation, collateral assignment, deposit arrangement, lien, charge, claim, security interest, easement or encumbrance, or preference, priority or other security agreement or preferential arrangement of

any kind or nature whatsoever (including any lease or title retention agreement, any financing lease having substantially the same economic effect as any of the foregoing, and the filing of, or agreement to give, any financing statement perfecting a security interest under the UCC or comparable law of any jurisdiction).

          “ Life Insurance Policy ” means a current, valid and fully paid key man life insurance policy in the amount of at least $2,500,000 that insures the life of Stephen Ruzika and that (i) names Borrowers as the sole beneficiaries, (ii) is issued by a carrier and otherwise is in form and substance acceptable to Agent in its Permitted Discretion, and (iii) is collaterally assigned to Agent for the ratable benefit of Lenders and as such expressly provides that it cannot be altered, amended, modified or canceled without thirty (30) Business Days prior written notice to Agent and that it inures to the benefit of Agents and Lenders notwithstanding any action or omission or negligence of or by any Borrower or any insured thereunder.

          “ Litigation ” has the meaning ascribed to it in Section 4.13 .

          “ Loan ” means, at any time, the aggregate amount of Advances outstanding to Borrowers from a Lender or all Lenders, as applicable.

          “ Loan Account ” has the meaning ascribed to it in Section 2.9 .

          “ Loan Documents ” means the Agreement, any Notes, the Collateral Documents and all other agreements, instruments, documents and certificates identified in Section 3.1 executed and delivered to, or in favor of, Agent or any Lender and including all other pledges, powers of attorney, consents, assignments, contracts, notices, letter of credit agreements and all other written matter whether heretofore, now or hereafter executed by or on behalf of any Borrower, or any employee of any Borrower, and delivered to Agent or any Lender in connection with the Agreement or the transactions contemplated thereby. Any reference in the Agreement or any other Loan Document to a Loan Document shall include all appendices, exhibits or schedules thereto, and all amendments, restatements, supplements or other modifications thereto, and shall refer to the Agreement or such Loan Document as the same may be in effect at any and all times such reference becomes operative.

          “ Lockbox Account ” has the meaning ascribed to it in Section 2.5(b) .

          “ Lockbox Agreement ” means a tri-party lockbox agreement in the form of Exhibit 2.5(b)(2) hereto among a Borrower, the Agent and a Lockbox Bank or such other form as is acceptable to Agent in its Permitted Discretion.

          “ Lockbox Bank ” has the meaning ascribed to it in Section 2.5(b) .

          “ Margin Stock ” has the meaning ascribed to it in Section 4.10 .

          “ Material Adverse Effect ” means a material adverse effect on (a) the business, assets, operations or financial or other condition of the Borrowers considered as a whole, (b) the Borrowers’ ability to pay any of the Loans or to pay or perform any of the other Obligations in accordance with the terms of this Agreement or the other Loan Documents, (c) the Collateral (taken as a whole) or Agent’s Liens, on behalf of itself and Lenders, on the Collateral or the

priority of such Liens, or (d) Agent’s or any Lender’s rights and remedies under this Agreement and the other Loan Documents or their ability to enforce the same.

          “ Material Contract ” means: (a) any agreement relating to the acquisition of Alarm Contracts; (b) any Monitoring Contract; (c) any Off Site Storage Agreement; (d) all licensing or other use agreements relating to computer software of any Borrower; (e) all agreements and contracts of any Borrower for the use of telephone lines; and (f) such other agreements, documents and contracts as Agent may reasonably designate as “ material ” from time to time by written notice to the Borrowers; all of the foregoing, as amended, supplemented, restated or replaced from time to time.

          “ Maturity Date ” means November 9, 2008.

          “ Maximum Amount ” means, as of any date of determination, an amount equal to the aggregate of all Lenders’ Commitments, as of such date.

          “ Measured Time Period ” shall mean, for the first six (6) months after the Closing Date, the number of months then ended since the Closing Date beginning with November 2005; and thereafter it shall mean the immediately preceding six (6) months.

          “ Monitoring Contract ” means an agreement between any Borrower and a third party pursuant to which such Borrower subcontracts the electronic monitoring of alarm systems provided for under Alarm Contracts.

          “ Mortgages ” means each of the mortgages, deeds of trust, leasehold mortgages, leasehold deeds of trust, collateral assignments of leases or other real estate security documents delivered by any Borrower to Agent, on behalf of itself and Lenders, from time to time, with respect to any Real Estate, all in form and substance reasonably satisfactory to Agent.

          “ Multiemployer Plan ” means a “ multiemployer plan ” as defined in Section 4001(a)(3) of ERISA, and to which any Borrower or ERISA Affiliate is making, is obligated to make or has made or been obligated to make within the last six years, contributions on behalf of participants who are or were employed by any of them.

          “ Non-Corporate Domestic Lender ” means any Lender that is a “ United States person ” but is not a “ domestic ” corporation (as such terms are defined in Code Section 7701(a)) .

          “ Non-Funding Lender ” has the meaning ascribed to it in Section 11.9(a)(ii) .

          “ Nonsolicitation and Disclosure Agreements ” has the meaning ascribed to it in Section 3.1(z) .

          “ Note ” and “ Notes ” mean any notes issued pursuant to Section 2.1(b) .

          “ Notice of Advance ” has the meaning ascribed to it in Section 2.1(a) .

          “ Notice of Conversion/Continuation ” has the meaning ascribed to it in Section 2.4(f) .

          “ Notice of Termination ” has the meaning ascribed to it in Section 2.2(a) .

          “ Obligations ” means all loans, advances, debts, liabilities and obligations, for the performance of covenants, tasks or duties or for payment of monetary amounts (whether or not such performance is then required or contingent, or such amounts are liquidated or determinable) owing by any Borrower to Agent or any Lender, and all covenants and duties regarding such amounts, of any kind or nature, present or future, whether or not evidenced by any note, agreement, letter of credit agreement or other instrument, arising under the Agreement or any of the other Loan Documents. This term includes all principal, interest (including all interest that accrues after the commencement of any case or proceeding by or against any Borrower in bankruptcy, whether or not allowed in such case or proceeding), Fees, hedging obligations under swaps, caps and collar arrangements provided by any Lender, expenses, in-house and external attorneys’ fees and any other sum chargeable to any Borrower under the Agreement or any of the other Loan Documents.

          “ Off Site Storage Agreement ” means any agreement between any Borrower and a storage company, bailee or other third party, regarding the bailment, holding or storage or Alarm Contracts or other assets or property of such Borrower.

          “ Other Taxes ” means present or future stamp or documentary taxes and any other excise, property or similar taxes, charges or levies that arise from or in connection with any payment made hereunder or under any other Loan Document or from the execution, delivery or registration of, performance under, or otherwise with respect to, this Agreement or any other Loan Document.

          “ Parent ” has the meaning ascribed thereto in the Recitals to the Agreement.

          “ Parent Pledge Agreement ” means the Pledge Agreement of even date herewith executed by Parent in favor of Agent, on behalf of itself and Lenders, pledging all Stock of Holdings.

          “ Patent License ” means rights under any written agreement now owned or hereafter acquired by any Borrower granting any right with respect to any invention on which a Patent is in existence.

          “ Patent Security Agreements ” means the Patent Security Agreements made in favor of Agent, on behalf of itself and Lenders, by each applicable Borrower.

          “ Patents ” means all of the following in which any Borrower now holds or hereafter acquires any interest: (a) all letters patent of the United States or any other country, all registrations and recordings thereof, and all applications for letters patent of the United States or of any other country, including registrations, recordings and applications in the United States Patent and Trademark Office or in any similar office or agency of the United States, any state or any other country, and (b) all reissues, continuations, continuations-in-part or extensions thereof.

          “ PBGC ” means the Pension Benefit Guaranty Corporation.

          “ Pension Plan ” means a Plan described in Section 3(2) of ERISA.

          “ Permitted Acquisition ” has the meaning ascribed to it in Section 7.1 .

          “ Permitted Discretion ” means a determination or judgment made by Agent in good faith in the exercise of reasonable (from the perspective of a secured lender making loans of the type evidenced hereby) business judgment.

          “ Permitted Encumbrances ” means the following Liens and encumbrances: (a) Liens for Taxes and Charges due but not yet delinquent or which are being contested in accordance with Section 6.2(b) ; (b) pledges or deposits of money securing statutory obligations under workers’ compensation, unemployment insurance, social security or public liability laws or similar legislation (excluding Liens under ERISA) provided in aggregate amount of outstanding of contingent liabilities of the Borrowers at any one time outstanding thereunder does not exceed $500,000; (c) pledges or deposits of money securing bids, tenders, contracts (other than contracts for the payment of money) or leases to which any Borrower is a party as lessee made in the ordinary course of business provided in aggregate amount of outstanding or contingent liabilities of the Borrowers at any one time outstanding thereunder does not exceed $500,000; (d) deposits securing, or in lieu of, surety, performance, appeal or customs bonds in proceedings to which any Borrower is a party and securing liabilities in the ordinary course of business provided in aggregate amount of outstanding or contingent liabilities of the Borrowers at any one time outstanding thereunder does not exceed $500,000; (e) any attachment or judgment lien not constituting an Event of Default under Section 10.1(i) ; (f) zoning restrictions, easements, right-of-ways, licenses, or other restrictions on the use of any Real Estate or other minor irregularities in title (including leasehold title) thereto, so long as the same do not, individually or in the aggregate, materially impair the use, value, or marketability of such Real Estate; (g) presently existing or hereafter created Liens in favor of Agent, on behalf of Lenders; (h) Liens expressly permitted under Section 7.7 of the Agreement, (i) with respect to any Real Estate, matters disclosed on the title commitment with respect thereto so long as such matters do not, individually or in the aggregate, materially affect the marketability or have a material impact on the value or quality of such title; (j) landlord’s liens so long such liens are subordinated in right of payment to the Obligations in accordance with a landlord’s agreement to the extent required pursuant to Section 6.9 ; and (k) Liens arising from UCC financing statement filings regarding operating leases entered into by any Borrower in the ordinary course of business, limited to the assets so leased; provided, however, that such Liens are not created, incurred or assumed in connection with, or in contemplation of, any Person becoming a Subsidiary of any Borrower; provided further, however, that any such Lien may not extend to any other property owned by any Borrower.

          “ Person ” means any individual, sole proprietorship, partnership, joint venture, trust, unincorporated organization, association, corporation, limited liability company, institution, public benefit corporation, other entity or government (whether federal, state, county, city, municipal, local, foreign, or otherwise, including any instrumentality, division, agency, body or department thereof).

          “ Plan ” means, at any time, an “ employee benefit plan ,” as defined in Section 3(3) of ERISA, that any Borrower or ERISA Affiliate maintains, contributes to or has an obligation to contribute to on behalf of participants who are or were employed by any Borrower.

          “ Pledge Agreements ” means the Borrower Pledge Agreement, the Parent Pledge Agreement, and any other pledge agreement entered into after the Closing Date by any other Person (as required by this Agreement or any other Loan Document).

          “ Post Closing Agreement ” has the meaning ascribed to it in Section 6.10 .

          “ Pro Rata Share ” means with respect to all matters relating to any Lender (a) prior to the Commitment Termination Date, the percentage obtained by dividing (i) the Commitment of that Lender by (ii) the aggregate Commitments of all Lenders, as any such Commitments and percentages may be adjusted by assignments permitted pursuant to Section 11.1 , and (b) on and after the Commitment Termination Date, the percentage obtained by dividing (i) the aggregate outstanding principal balance of the Loans held by that Lender, by (ii) the outstanding principal balance of the Loans held by all Lenders.

          “ Proceeds ” means “ proceeds ,” as such term is defined in the UCC, including (a) any and all proceeds of any insurance, indemnity, warranty or guaranty payable to any Borrower from time to time with respect to any of the Collateral, (b) any and all payments (in any form whatsoever) made or due and payable to any Borrower from time to time in connection with any requisition, confiscation, condemnation, seizure or forfeiture of all or any part of the Collateral by any Governmental Authority (or any Person acting under color of governmental authority), (c) any claim of any Borrower against third parties (i) for past, present or future infringement of any Patent or Patent License, or (ii) for past, present or future infringement or dilution of any Copyright, Copyright License, Trademark or Trademark License, or for injury to the goodwill associated with any Trademark or Trademark License, (d) any recoveries by any Borrower against third parties with respect to any litigation or dispute concerning any of the Collateral including claims arising out of the loss or nonconformity of, interference with the use of, defects in, or infringement of rights in, or damage to, Collateral, (e) all amounts collected on, or distributed on account of, other Collateral, including dividends, interest, distributions and Instruments with respect to Investment Property and pledged Stock, and (f) any and all other amounts, rights to payment or other property acquired upon the sale, lease, license, exchange or other disposition of Collateral and all rights arising out of Collateral.

          “ Projections ” means Holdings’ forecasted consolidated: (a) balance sheets; (b) income statements; and (c) cash flow statements and otherwise consistent with the books and records from the previous period in all material respects, except as noted therein with reasonable explanatory comments, together with appropriate supporting details and a statement of underlying assumptions.

          “ Qualified Alarm Contract ” means an Alarm Contract payable in the lawful currency of the United States of America:

          (a) as to which a Borrower (i) owns all right, title and interest, free and clear of all Liens, other than Permitted Encumbrances, (ii) no later than the date of acquisition or replacement, (A) in connection with any Alarm Contract acquired through a Permitted Acquisition after the Closing Date, has filed either a blanket or precautionary UCC-1 financing statements against the related dealer, in the appropriate jurisdiction, covering all of the dealers Alarm Contracts or listing such Alarm Contract, as applicable, and (B) has obtained

acknowledgement from the related dealer that all future Alarm Contracts with the Subscribers listed in the existing acquisition agreement have been transferred to such Borrower under the applicable acquisition agreement and (iii) no later than the date of filing of any UCC-1 financing statements required by the preceding clause (A), has obtained authorization from the related dealer to file such UCC-1 financing statements;

          (b) which is fully executed and in full force and effect, enforceable in accordance with its terms;

          (c) which (i) is fully assignable (or consent to assignment has been provided in form and substance reasonably satisfactory to Agent), (ii) includes limitation of liability and third party indemnification provisions acceptable to Agent, (iii) complies with applicable Law including without limitation all federal and state consumer credit laws, and (iv) is otherwise in form and substance reasonably satisfactory to Agent;

          (d) as to which the alarm system related to such Alarm Contract (i) is installed in (A) New York or Florida or (B) any other state consented to in writing by Agent, (ii) is in good working order and condition, and (iii) has been installed and maintained in accordance with good and workmanlike practices prevailing in the alarm industry in the jurisdiction in which the applicable alarm system is installed;

          (e) as to which all parties related to such Alarm Contract have performed all obligations under or with respect to such Alarm Contract or the related alarm system and no such party is in default thereunder (except as permitted under the definition of Qualified RMR), and neither any Borrower nor the related dealer has received any notice of a default or breach (or anticipated default or breach) under such Alarm Contract or terminated, cancelled or written off such Alarm Contract;

          (f) in connection with any Alarm Contract acquired through a Permitted Acquisition after the Closing Date, to the best of any Borrower’s knowledge after due inquiry, as to which the related dealer and seller, if any, has all licenses and permits necessary and material to the enforceability of such Alarm Contract, including, without limitation, having filed and maintained an effective and current notice of business activities report or similar evidence of qualification to transact business in each state in which such dealer (and seller) enters into, services or acquires Alarm Contracts;

          (g) as to which no notice of cancellation or termination has been received by any Borrower or the related dealer or subcontractor;

          (h) as to which all of the representations, warranties and covenants made under this Agreement relating to such Alarm Contract are true and correct (as of any date made), including, without limitation, the covenants set forth in Section 6.13 hereof;

          (i) as to which there exists only one original executed copy (for purposes hereof and elsewhere in this Agreement, carbon copies not to be considered originals);

          (j) as to which the alarm system related to such Alarm Contract and its installation and monitoring conform in all material respects to the terms of such Alarm Contract and applicable Law;

          (k) as to which the applicable Subscriber is not (i) a Subsidiary, Affiliate or employee of Parent, any Borrower or the related dealer, or (ii) paying pursuant to a negotiated payment plan as a result of non-payment, insolvent or the subject of any bankruptcy or insolvency proceedings of any kind or any other proceeding or action which might have a material adverse effect on such Subscriber; and

          (l) is otherwise satisfactory to the Agent in its reasonable discretion.

          “ Qualified Assignee ” means (a) any Lender, any Affiliate of any Lender and, with respect to any Lender that is an investment fund that invests in commercial loans, any other investment fund that invests in commercial loans and that is managed or advised by the same investment advisor as such Lender or by an Affiliate of such investment advisor, and (b) any commercial bank, savings and loan association or savings bank or any other entity which is an “ accredited investor ” (as defined in Regulation D under the Securities Act) which extends credit or buys loans as one of its businesses, including insurance companies, mutual funds, lease financing companies and commercial finance companies, in each case, which has a rating of BBB or higher from S&P and a rating of Baa2 or higher from Moody’s at the date that it becomes a Lender and which, through its applicable lending office, is capable of lending to Borrower without the imposition of any withholding or similar taxes; provided that, no Person proposed to become a Lender after the Closing Date who (i) is determined by Agent to be acting in the capacity of a vulture fund or distressed debt purchaser or (ii) holds Subordinated Debt or Stock issued by any Borrower, shall be a Qualified Assignee.

          “ Qualified Plan ” means a Pension Plan that is intended to be tax-qualified under Section 401(a) of the Code.

          “ Qualified Retail RMR ” means RMR which meets each of the following criteria: (a) such RMR is (i) not more than ninety (90) days past due (except for the Slow Pay RMR, which is deemed to be Qualified Retail RMR for purposes of this definition) and (ii) such RMR has not been terminated, cancelled or written off, nor has the Subscriber provided notice of termination; (b) not more than 22% of such RMR are from Qualified Alarm Contracts which are more than thirty (30) days past due; (c) no such RMR is from a Qualified Alarm Contract entered into after March 31, 2001 with a residential Subscriber whose “ Beacon ” credit score, at the time such Qualified Alarm Contract was entered into, was less than 600; (d) not more than $75,000 of such RMR is from Qualified Alarm Contracts which are Governmental Authorities subject to the Federal Assignment of Claims Act of 1940, as amended, or any similar state or local law (unless the Agent has been delivered evidence reasonably satisfactory to it that the Agent has a properly perfected first priority security interest in the related Qualified Alarm Contract and has received all consents from any Government Authority necessary to enable Lender to fully protect its interest in such Qualified Alarm Contract); (e) such RMR is not attributable to Wholesale RMR; and (f) such RMR is otherwise satisfactory to the Agent in its reasonable discretion. In addition, the Borrowers acknowledge and agree that the RMR attributable to Boca Pointe HOA shall be excluded from the calculation of Qualifying Retail RMR.

          “ Qualified Retail RMR Leverage Ratio ” means, as of any date of determination, the ratio of (a) the amount of the Loan, less the product of ten (10) times the amount of Qualified Wholesale RMR, to (b) Qualified Retail RMR.

          “ Qualified RMR ” means the aggregate amount of the Qualified Retail RMR and the Qualified Wholesale RMR.

          “ Qualified Wholesale RMR ” means that portion of the RMR that is attributable to Wholesale RMR and which meets each of the following criteria: (a) such RMR is (i) not more than ninety (90) days past due; and (ii) such RMR has not been terminated, cancelled or written off, nor has the alarm dealer provided notice of termination; (b) not more than 22% of such RMR are from Qualified Alarm Contracts which are more than thirty (30) days past due; and (c) such RMR is otherwise satisfactory to Lender in its reasonable discretion.

          “ Real Estate ” has the meaning ascribed to it in Section 4.6 .

          “ Relationship Bank ” has the meaning ascribed to it in Section 2.5(a) .

          “ Release ” means any release, threatened release, spill, emission, leaking, pumping, pouring, emitting, emptying, escape, injection, deposit, disposal, discharge, dumping, or leaching of Hazardous Material in the indoor or outdoor environment.

          “ Requisite Lenders ” means Lenders having (a) more than 66 and 2/3% of the Commitments of all Lenders, or (b) if the Commitments have been terminated, more than 66 and 2/3% of the aggregate outstanding amount of the Loans.

          “ Restricted Payment ” means, with respect to any Borrower (a) the declaration or payment of any dividend or the incurrence of any liability to make any other payment or distribution of cash or other property or assets in respect of Stock; (b) any payment on account of the purchase, redemption, defeasance, sinking fund or other retirement of such Borrower’s Stock or any other payment or distribution made in respect thereof, either directly or indirectly; (c) any payment or prepayment of principal of, premium, if any, or interest, fees or other charges on or with respect to, and any redemption, purchase, retirement, defeasance, sinking fund or similar payment and any claim for rescission with respect to, any Subordinated Debt; (d) any payment made to redeem, purchase, repurchase or retire, or to obtain the surrender of, any outstanding warrants, options or other rights to acquire Stock of such Borrower now or hereafter outstanding; (e) any payment of a claim for the rescission of the purchase or sale of, or for material damages arising from the purchase or sale of, any shares of such Borrower’s Stock or of a claim for reimbursement, indemnification or contribution arising out of or related to any such claim for damages or rescission; (f) any payment, loan, contribution, or other transfer of funds or other property to any Stockholder of such Borrower other than (i) payment of compensation or reimbursement of business related expenses in the ordinary course of business to Stockholders who are employees of such Borrower and (ii) the reimbursement of out-of-pocket expenses of the directors of any Borrower for such director’s attendance of board meetings not to exceed $25,000 in any Fiscal Year; (g) any payment of management fees (or other fees of a similar nature) by such Borrower to the Parent or any Affiliate of the Parent or any Borrower; and (h) any payment on account of working capital adjustments or earn-out payments made pursuant

to any acquisition agreement; provided that, this is not intended to restrict the payment of any Holdback Liabilities required to be paid pursuant to the related acquisition agreement.

          “ Retiree Welfare Plan ” means, at any time, a Welfare Plan that provides for continuing coverage or benefits for any participant or any beneficiary of a participant after such participant’s termination of employment, other than continuation coverage provided pursuant to Section 4980B of the Code and at the sole expense of the participant or the beneficiary of the participant.

          “ RMR ” means, for any calendar month, the aggregate recurring regular monthly amount paid by Subscribers, including other alarm dealers, under Qualified Alarm Contracts for a one-month period as payment for regular and on-going electronic monitoring services, closed-circuit television and access control systems, maintenance, fire and/or other electronic security system related services (but excluding any non-recurring, special or one-time charges (including, without limitation, amounts billed for installation charges and/or repairs), taxes, fees and other assessments or amounts imposed by Governmental Authorities or fire or law enforcement institutions related to such Qualified Alarm Contracts, charges or costs associated with equipment purchases, lease financing revenue, charges related to telephone transmission of alarm signals and other utility charges, antenna rental charges, panel use, franchise and license fees, false alarm charges and similar charges).

          “ Security Agreement ” means the Security Agreement of even date herewith entered into by and among Agent, on behalf of itself and Lenders, and each Borrower that is a signatory thereto.

          “ Slow Pay RMR ” means RMR (other than Wholesale RMR) that is due from a commercial Subscriber under a Qualified Alarm Contract of which at least a portion is more than ninety (90) days past due, but no portion is more than one hundred twenty (120) days past due; and provided that such Subscriber has made one or more payments during the ninety (90) days immediately prior to the date of determination in an aggregate amount of not less than one month’s RMR under such Qualified Alarm Contract.

          “ Software ” means all “ software ” as such term is defined in the UCC, now owned or hereafter acquired by any Borrower, other than software embedded in any category of Goods, including all computer programs and all supporting information provided in connection with a transaction related to any program.

          “ Solvent ” means, with respect to any Person on a particular date, that on such date (a) the fair value of the property of such Person is greater than the total amount of liabilities, including contingent liabilities, of such Person; (b) the present fair salable value of the assets of such Person is not less than the amount that will be required to pay the probable liability of such Person on its debts as they become absolute and matured; and (c) such Person does not intend to, and does not believe that it will, incur debts or liabilities beyond such Person’s ability to pay as such debts and liabilities mature. The amount of contingent liabilities (such as litigation, guaranties and pension plan liabilities) at any time shall be computed as the amount that, in light of all the facts and circumstances existing at the time, represents the amount that can reasonably be expected to become an actual or matured liability.

          “ Stock ” means all shares, options, warrants, general or limited partnership interests, membership or limited liability company interests or other equivalents (regardless of how designated) of or in a corporation, partnership, limited liability company or equivalent entity whether voting or nonvoting, including common stock, preferred stock or any other “ equity security ” (as such term is defined in Rule 3a11-1 of the General Rules and Regulations promulgated by the Securities and Exchange Commission under the Securities Exchange Act of 1934); provided that any earn-out or similar obligation incurred pursuant to a Permitted Acquisition shall be deemed not to constitute Stock.

          “ Stockholder ” means, with respect to any Person, each holder of Stock of such Person.

          “ Subscriber ” means an individual or other Person obligated under an Alarm Contract, who receives regular and on-going electronic monitoring services, closed-circuit television and access control systems, maintenance, fire and/or other electronic security system related services from a Borrower.

          “ Subordinated Debt ” means any Indebtedness of any Borrower fully subordinated to the Obligations in a manner and form satisfactory to Agent as to right and time of payment and as to any other rights and remedies thereunder.

          “ Subsidiary ” means, with respect to any Person, (a) any corporation of which an aggregate of more than 50% of the outstanding Stock having ordinary voting power to elect a majority of the board of directors of such corporation (irrespective of whether, at the time, Stock of any other class or classes of such corporation shall have or might have voting power by reason of the happening of any contingency) is at the time, directly or indirectly, owned legally or beneficially by such Person or one or more Subsidiaries of such Person, or with respect to which any such Person has the right to vote or designate the vote of 50% or more of such Stock whether by proxy, agreement, operation of law or otherwise, and (b) any partnership or limited liability company in which such Person and/or one or more Subsidiaries of such Person shall have an interest (whether in the form of voting or participation in profits or capital contribution) of more than 50% or of which any such Person is a general partner or may exercise the powers of a general partner. Unless the context otherwise requires, each reference to a Subsidiary shall be a reference to a Subsidiary of any Borrower.

          “ Supporting Obligations ” means all “ supporting obligations ” as such term is defined in the UCC, including letters of credit and guaranties issued in support of Accounts, Chattel Paper, Documents, General Intangibles, Instruments, or Investment Property.

          “ Taxes ” means taxes, levies, imposts, deductions, or withholdings, and all liabilities with respect thereto, imposed by any Governmental Authority.

          “ Termination Date ” means the date on which (a) the Loans have been indefeasibly repaid in full, (b) all other Obligations, other than residual indemnity that survive payment in full of the Loans, under the Agreement and the other Loan Documents have been completely discharged, and (c) the Borrowers shall not have any further right to borrow any monies under the Agreement.

          “ Termination Fee ” has the meaning ascribed to it in the Fee Letter.

          “ Third Party Consent Form ” means a form signed by any Person, other than any Borrower, that is a party to a Material Contract, consenting to the assignment of a Material Contract to such Borrower.

          “ Title IV Plan ” means a Pension Plan (other than a Multiemployer Plan), that is covered by Title IV of ERISA, and that any Borrower or ERISA Affiliate maintains, contributes to or has an obligation to contribute to on behalf of participants who are or were employed by any of them.

          “ Total Borrowing Availability ” means, as of any date, the Maximum Amount minus $500,000.

          “ Total Debt ” means, with respect to Holdings and its consolidated Subsidiaries, without duplication, the principal portion of all Indebtedness for borrowed money evidenced by notes, bonds, debentures, or similar evidences of Indebtedness and that by its terms matures more than one year from, or is directly or indirectly renewable or extendible at any such Person’s option under a revolving credit or similar agreement obligating the lender or lenders to extend credit over a period of more than one year from the date of creation thereof, and specifically including Capital Lease Obligations, current maturities of long-term debt, revolving credit and short-term debt extendible beyond one year at the option of the debtor, and also including, in the case of the Borrowers, the Obligations and, without duplication, Guaranty Obligations consisting of guaranties of Total Debt of other Persons; provided that, the aggregate amount of performance, surety and appeal bonds, to the extent not in excess, at any time of measurement, of $500,000, shall be excluded from any calculation of Total Debt to the extent that such amount would otherwise be included therein.

          “ Total Revenue ” means, for any fiscal period, all revenue of Holdings on a consolidated basis, as calculated for such period in accordance with GAAP.

          “ Trademark License ” means rights under any written agreement now owned or hereafter acquired by any Borrower granting any right to use any Trademark.

          “ Trademark Security Agreements ” means the Trademark Security Agreements made in favor of Agent, on behalf of Lenders, by each applicable Borrower.

          “ Trademarks ” means all of the following now owned or hereafter adopted or acquired by any Borrower: (a) all trademarks, trade names, corporate names, business names, trade styles, service marks, service name, logos, other source or business identifiers, prints and labels on which any of the foregoing have appeared or appear, designs and general intangibles of like nature (whether registered or unregistered), all registrations and recordings thereof, and all applications in connection therewith, including registrations, recordings and applications in the United States Patent and Trademark Office or in any similar office or agency of the United States, any state or territory thereof, or any other country or any political subdivision thereof; (b) all reissues, extensions or renewals thereof; and (c) all goodwill associated with or symbolized by any of the foregoing.

          “ UCC ” means the Uniform Commercial Code as the same may, from time to time, be enacted and in effect in the State of Maryland; provided , that to the extent that the UCC is used to define any term herein or in any Loan Document and such term is defined differently in different Articles or Divisions of the UCC, the definition of such term contained in Article or Division 9 shall govern; provided further , that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection or priority of, or remedies with respect to, Agent’s or any Lender’s Lien on any Collateral is governed by the Uniform Commercial Code as enacted and in effect in a jurisdiction other than the State of Maryland, the term “ UCC ” shall mean the Uniform Commercial Code as enacted and in effect in such other jurisdiction solely for purposes of the provisions thereof relating to such attachment, perfection, priority or remedies and for purposes of definitions related to such provisions.

          “ Unfunded Pension Liability ” means, at any time, the aggregate amount, if any, of the sum of the amount by which the present value of all accrued benefits under each Title IV Plan exceeds the fair market value of all assets of such Title IV Plan allocable to such benefits in accordance with Title IV of ERISA, all determined as of the most recent valuation date for each such Title IV Plan using the actuarial assumptions for funding purposes as if the Plan terminated in effect under such Title IV Plan.

          “ Unused Line Fee ” has the meaning ascribed to it in Section 2.6(b) .

          “ Welfare Plan ” means a Plan described in Section 3(1) of ERISA.

          “ Wholesale RMR ” means RMR paid by other alarm dealers that subcontract with Borrower for the provision of alarm monitoring services to the customers of such dealers.

          “ Write-Off Policy ” has the meaning ascribed to it in Section 4.29 .

          Rules of construction with respect to accounting terms used in the Agreement or the other Loan Documents shall be as set forth in Section 9 . All other undefined terms contained in any of the Loan Documents shall, unless the context indicates otherwise, have the meanings provided for by the UCC to the extent the same are used or defined therein. Unless otherwise specified, references in the Agreement or any of the Appendices relating to a Section, subsection or clause refer to such Section, subsection or clause as contained in the Agreement. The words “ herein ,” “ hereof ” and “ hereunder ” and other words of similar import refer to the Agreement as a whole, including all schedules, exhibits and disclosure schedules, as the same may from time to time be amended, restated, modified or supplemented, and not to any particular section, subsection or clause contained in the Agreement or any such schedule, exhibit or disclosure schedule.

          Wherever from the context it appears appropriate, each term stated in either the singular or plural shall include the singular and the plural, and pronouns stated in any gender shall include all genders. The words “ including ,” “ includes ” and “ include ” shall be deemed to be followed by the words “ without limitation ”; the word “ or ” is not exclusive; references to Persons include their respective successors and assigns (to the extent and only to the extent permitted by the Loan Documents) or, in the case of governmental Persons, Persons succeeding to the relevant functions of such Persons; and all references to statutes and related regulations shall include any

amendments of the same and any successor statutes and regulations. Whenever any provision in any Loan Document refers to the knowledge (or an analogous phrase) of any Borrower, such words are intended to signify that such Borrower has actual knowledge or awareness of a particular fact or circumstance or that such Borrower, if it had exercised reasonable diligence, would have known or been aware of such fact or circumstance.

2. AMOUNT AND TERMS OF CREDIT

     2.1 Revolving Credit Facility.

          (a) Subject to the terms and conditions hereof, each Lender shall make available to the Borrowers from time to time until the Commitment Termination Date its Pro Rata Share of advances (each, an “ Advance ”). The Pro Rata Share of the Loan of any Lender shall not at any time exceed its separate Commitment. The obligations of each Lender hereunder shall be several and not joint. Until the Commitment Termination Date, the Borrowers may from time to time borrow, repay and reborrow under this Section 2.1(a) ; provided, that the amount of any Advance to be made at any time shall be at least equal to or greater than $250,000 and not exceed Borrowing Availability at such time and at no time shall the total amount of Advances outstanding exceed the Total Borrowing Availability. Each Advance shall be made on notice by the Borrowers to the Agent at the address specified in Section 13.10 or as otherwise specified by Agent to Borrowers in writing. Any such notice (other than the notice for the Initial Advance) must be given no later than (1) noon (New York time) on the date which is one (1) Business Day prior to the proposed Advance, in the case of a Base Rate Loan, or (2) noon (New York time) on the date which is three (3) Business Days prior to the proposed Advance, in the case of a LIBOR Loan. Each such notice (a “ Notice of Advance ”) must be given in writing (by telecopy or overnight courier) in the form of a Borrowing Base Certificate as set forth in Exhibit 5.1(b) . If the Borrowers desire to have the Advances bear interest by reference to a LIBOR Rate, it must comply with Section 2.4(f) . Agent may charge Borrowers a wire fee for each Advance.

          (b) (i) Agent shall maintain, in accordance with its usual practice, electronic or written records evidencing the indebtedness and obligations to the Lenders resulting from any Advance made by a Lender from time to time, including without limitation, the amounts of principal and interest payable and paid to such Lender from time to time under this Agreement.

               (ii) The Borrowers agree that:

                    (A) upon written notice by Agent to the Borrowers that a promissory note or other evidence of indebtedness is requested by Agent or any Lender to evidence the Loan and other Obligations owing or payable to, or to be made by, such Lender, the Borrowers shall promptly (and in any event within five (5) Business Days of any such request) execute and deliver to Agent an appropriate promissory note or notes in form and substance reasonably acceptable to Agent and Borrower, payable to the order of such Lender or in a principal amount equal to the amount of the Loans owing or payable to Lender;

                    (B) all references to Notes in the Loan Documents shall mean Notes, if any, to the extent issued (and not returned to the Borrowers for cancellation) hereunder,

as the same may be amended, modified, divided, supplemented and/or restated from time to time; and

                    (C) upon a Lender’s written request, and in any event within five (5) Business Days of any such request, Borrowers shall execute and deliver to such Lender new Notes and/or divide the Notes in exchange for then existing Notes in such smaller amounts or denominations as such Lender shall specify in its sole and absolute discretion; provided , that the aggregate principal amount of such new Notes shall not exceed the aggregate principal amount of the Notes outstanding at the time such request is made; and provided, further, that such Notes that are to be replaced shall then be deemed no longer outstanding hereunder and replaced by such new Notes and returned to the Borrowers within a reasonable period of time after Lender’s receipt of the replacement Notes.

          (c) The entire unpaid balance of the Loan and all other non-contingent Obligations shall be immediately due and payable in full in immediately available funds on the Maturity Date.

     2.2 Prepayments .

          (a) Voluntary Prepayments of Loans; Reductions in Commitments . The Borrowers may at any time on at least five (5) Five Business Days’ prior written notice to Agent (i) voluntarily prepay all or part of the Loans and/or (ii) permanently reduce (but not terminate) the Commitment; provided that (A) any such prepayments or reductions shall be in a minimum amount of $100,000 and integral multiples of $100,000 in excess of such amount, (B) the Commitment shall not be reduced to an amount less than the aggregate amount of the outstanding Loan at such time and (C) after giving effect to such reductions, the Borrowers shall be in compliance with Section 2.2(b)(i) . The Borrowers may at any time on at least three (3) days’ prior written notice to Agent terminate the Commitments (“ Notice of Termination ”). If the Borrowers terminate the Commitments prior to the Commitment Termination Date, the Borrowers shall pay to Agent, solely for Agent’s benefit (in addition to the then outstanding principal, accrued interest and Obligations owing pursuant to the terms of this Agreement and any other Loan Document), as yield maintenance for the loss of bargain and not as a penalty, an amount equal to the applicable Termination Fee. Any voluntary prepayment and any reduction or termination of the Commitments must be accompanied by payment of any LIBOR funding breakage costs in accordance with Section 2.10(b) . Upon any such reduction or termination of the Commitments, the Borrowers’ right to request Advances shall simultaneously be permanently reduced or terminated.

          (b) Mandatory Prepayments .

               (i) If at any time the outstanding balance of the Loan exceeds the Borrowing Base, including, as a result of any reduction in the amounts of the Commitments as set forth on Schedule I hereto, the Borrowers shall promptly (but in no event later than the second Business Day thereafter) repay the aggregate outstanding Advances to the extent required to eliminate such excess. Such prepayment will not, in and of itself, reduce any Commitment.

               (ii) Upon receipt by any Borrower of any cash proceeds of any asset disposition (other than Inventory disposed of in the ordinary course of business), such Borrower shall promptly (but in no event later than the second Business Day thereafter) prepay the Loan in an amount equal to all such proceeds, net of (A) commissions and other reasonable and customary transaction costs, fees and expenses properly attributable to such transaction and payable by such Borrower in connection therewith to an unrelated third party, (B) sales, use and transfer taxes, (C) amounts payable to holders of senior Liens on such asset (to the extent such Liens constitute Permitted Encumbrances hereunder), if any, and, so long as no Event of Default has occurred and is continuing, and (D) an appropriate reserve for income taxes in accordance with GAAP in connection therewith. In the event of any escrow or holdback arrangement with respect to any such disposition, the receipt of any deferred proceeds as a result thereof shall be deemed to occur when and as such proceeds are actually received by any Borrower. Notwithstanding the foregoing, the following shall not be subject to mandatory prepayment under this clause (ii) : (1) asset disposition proceeds that are reinvested in similar assets within one hundred eighty (180) days following receipt thereof; provided that (x) if such proceeds exceed $500,000 for any one disposition, such Borrower notifies Agent of its intent to reinvest at the time such proceeds are received and when such reinvestment occurs, (y) no Event of Default exists from and including the date of such disposition through and including the date of such reinvestment (and upon the occurrence of such Event of Default, Agent may automatically, or Borrowers shall at the instruction of the Agent, apply any such proceeds to prepayment of the Loans) and (z) at all times prior to such reinvestment such proceeds shall be deposited in a Bank Account (except to the extent the Agent, in its discretion, requires such Borrower to deposit such amounts in a blocked account); and (2) asset disposition proceeds invested in a Borrower and used to pay off such Borrower’s obligations arising under the terms of the Bridge Loan and to terminate any commitments arising thereunder. To the extent such funds are placed in a blocked account, they shall be made available to such Borrower to reinvest in similar assets upon any written request by such Borrower for the release of funds necessary for such reinvestment, so long as no Event of Default has occurred and is continuing at the time of such request. To the extent (x) not used to reinvest in similar assets, or (y) if any Event of Default has occurred or is continuing, such asset disposition proceeds shall be applied in accordance with Section 2.2(c) .

               (iii) If any Borrower issues Stock after the Closing Date or Indebtedness for borrowed money (whether or not permitted pursuant to this Agreement), such Borrower shall promptly (but in no event later than the second Business Day following the date of receipt of the proceeds thereof) prepay the Loans in an amount equal to all such proceeds, net of underwriting discounts and commissions and other reasonable costs, fees and expenses paid in connection therewith. Any such prepayment shall be applied in accordance with Section 2.2(c) . Notwithstanding the foregoing, the following shall not be subject to prepayment under this clause (iii) : (1) proceeds of Stock used to fund Permitted Acquisitions; (2) proceeds of the issuance of additional Indebtedness under this Agreement; (3) proceeds of any Indebtedness permitted pursuant to Section 7.3(a) ; and (4) proceeds of Stock issued for the purpose of paying off the Borrowers’ obligations arising under the terms of the Bridge Loan, provided that, as to any of the above, (x) Borrower notifies Agent of its intent to issue any such Stock, if applicable, and (y) no Event of Default exists at the time of receipt of such proceeds (and at all times prior to such permitted use, such proceeds shall be deposited into a Bank Account) and, upon the occurrence of any Event of Default, Agent may automatically, or Borrowers shall at the instruction of the Agent, apply any such proceeds to prepayment of the Loans).

          (c) Application of Prepayments . Any prepayment made on the Loan shall be applied as follows: first , to Fees and reimbursable expenses (previously documented for the Borrowers) of Agent then due and payable pursuant to any of the Loan Documents; second , to interest then due and payable on the Loan, ratably; and third , to the outstanding principal balance of the Loan until the same has been paid in full. The Commitments shall be permanently reduced by the amount of any such prepayments (other than such payments under clause (b)(i) above). Agent may charge Borrowers a wire fee for any prepayment hereunder.

          (d) No Implied Consent . Nothing in this Section 2.2 shall be construed to constitute Agent’s or any Lender’s consent to any transaction that is not permitted by other provisions of this Agreement or the other Loan Documents.

     2.3 Use of Proceeds .

          The Borrowers shall utilize the proceeds of the Loans as set forth in Recital A. Disclosure Schedule (2.3) contains a description of the Borrowers’ sources and uses of funds as of the Closing Date, including the Advance to be made or incurred on that date, and a funds flow memorandum detailing how funds from each source are to be transferred to particular uses.

     2.4 Interest and Applicable Margins .

          (a) The Borrowers shall pay interest to Agent, for the ratable benefit of Lenders in accordance with the various Loans being made by each Lender, in arrears on each applicable Interest Payment Date, at the following rates: (i) the Base Rate plus the Applicable Margin per annum, or (ii) at the election of the Borrowers, the applicable LIBOR Rate plus the Applicable Margin per annum.

          (b) The Applicable Margins shall be established by reference to the following Levels of Applicable Margins set forth below:

          The Applicable Margins shall be as follows:

          From the Closing Date until the first adjustment as described below, the Applicable Margins shall be set at Level VI. The Applicable Margins shall be adjusted monthly and retroactively effective as of the first day of a calendar month based upon the information set forth in the Borrowing Base Certificate for the prior month. If an Event of Default has occurred and is continuing at the time any reduction in the Applicable Margins is to be implemented, that reduction shall be deferred until the first day following the date on which such Event of Default is waived or cured.

          (c) If any payment on any Loan becomes due and payable on a day other than a Business Day, the maturity thereof will be extended to the next succeeding Business Day (except as set forth in the definition of LIBOR Period) and, with respect to payments of principal, interest thereon shall be payable at the then applicable rate during such extension. The foregoing shall not be given effect, however, in respect of the calculation of Financial Covenants relating to scheduled principal payments.

          (d) All computations of Fees calculated on a per annum basis and interest based on the LIBOR Rate shall be made by Agent on the basis of a 360-day year, in each case for the actual number of days occurring in the period for which such interest and Fees are payable. All computations of interest based on the Base Rate shall be made by Agent on the basis of a 365/366-day year, in each case for the actual number of days occurring in the period for which such interest and Fees are payable. The Base Rate is a floating rate determined for each day. Each determination by Agent of interest rates and Fees hereunder shall, absent manifest error, be presumptive evidence of the correctness of such rates and Fees.

          (e) So long as an Event of Default has occurred and is continuing under Section 10.1(a), (h) or (i) , the interest rates applicable to the Loans shall be increased by four percentage points (4%) per annum, and so long as any other Event of Default (except under Section 10.1(a) to the extent the following sentence shall apply) has occurred and is continuing and at the election of Requisite Lenders confirmed by written notice from Agent to the Borrowers, the interest rates applicable to the Loans shall be increased by two percentage points (2%) per annum, above the rates of interest otherwise applicable hereunder unless Agent or Requisite Lenders elect to impose a smaller increase (the “ Default Rate ”), and all outstanding Obligations shall bear interest at the Default Rate applicable to such Obligations. Interest at the Default Rate shall accrue from the initial date of the applicable Event of Default until that Event of Default is cured or waived and shall be payable upon demand.

          (f) Subject to the conditions precedent set forth in Section 2.2 , the Borrowers shall have the option to (i) request that any Advance be made as a LIBOR Loan, (ii) convert at any time all or any part of outstanding Loans from Base Rate Loans to LIBOR Loans, (iii) convert any LIBOR Loan to a Base Rate Loan, subject to payment of LIBOR breakage costs in accordance with Section 2.10(b) if such conversion is made prior to the expiration of the LIBOR Period applicable thereto, or (iv) continue all or any portion of any Loan as a LIBOR Loan upon the expiration of the applicable LIBOR Period and the succeeding LIBOR Period of that continued Loan shall commence on the first day after the last day of the LIBOR Period of the Loan to be continued. Any Loan or group of Loans having the same proposed LIBOR Period to be made or continued as, or converted into, a LIBOR Loan must be in a minimum amount of $100,000 and integral multiples of $100,000 in excess of such amount. Any such election must

be made by noon (New York time) on the third Business Day prior to (1) the date of any proposed Advance which is to bear interest at the LIBOR Rate, (2) the end of each LIBOR Period with respect to any LIBOR Loans to be continued as such, or (3) the date on which the Borrowers wish to convert any Base Rate Loan to a LIBOR Loan for a LIBOR Period designated by the Borrowers in such election. If no election is received with respect to a LIBOR Loan by noon (New York time) on the third Business Day prior to the end of the LIBOR Period with respect thereto (or if an Event of Default has occurred and is continuing or the additional conditions precedent set forth in Section 3.2 shall not have been satisfied), that LIBOR Loan shall be converted to a Base Rate Loan at the end of its LIBOR Period. The Borrowers must make such election by notice to Agent in writing, by telecopy or overnight courier. In the case of any conversion or continuation, such election must be made pursuant to a written notice (a “ Notice of Conversion/Continuation ”) in the form of Exhibit 2.4(f) .

          (g) Notwithstanding anything to the contrary set forth in this Section 2.4 , if a court of competent jurisdiction determines in a final order that the rate of interest payable hereunder exceeds the highest rate of interest permissible under law (the “ Maximum Lawful Rate ”), then so long as the Maximum Lawful Rate would be so exceeded, the rate of interest payable hereunder shall be equal to the Maximum Lawful Rate. In no event shall the total interest received by any Lender pursuant to the terms hereof exceed the amount that such Lender could lawfully have received had the interest due hereunder been calculated for the full term hereof at the Maximum Lawful Rate. If, due to any circumstance whatsoever, fulfillment of any provision hereof, at the time performance of such provision shall be due, shall exceed any such Maximum Lawful Rate, then, the obligation to be so fulfilled shall be reduced to such lawful limit, and, if Borrowers shall have paid interest or any other charges of any kind which might be deemed to be interest under applicable law in excess of the Maximum Lawful Rate, then such excess shall be applied first to any unpaid fees and charges hereunder, then to unpaid principal balance owed by Borrowers hereunder, and if the then remaining excess interest is greater than the previously unpaid principal balance, Agent shall promptly refund such excess amount to Borrowers and the provisions hereof shall be deemed amended to provide for such permissible rate. The terms and provisions of this Section 2.4(g) shall control to the extent any other provision of any Loan Document is inconsistent herewith.

     2.5 Cash Management Systems .

          Each Borrower will maintain until the Termination Date, the cash management systems described below (the “ Cash Management Systems ”).

          (a) Each Borrower shall (i) maintain all of it deposit and other bank accounts (“ Bank Accounts ”) at the banks set forth in Disclosure Schedule (4.19) , and (ii) deposit and cause all of its Subsidiaries to deposit or cause to be deposited promptly, and in any event no later than the third Business Day after the date of receipt thereof, all cash, checks, drafts or other similar items of payment relating to or constituting payments made in respect of any and all Collateral into one or more such Bank Accounts in a Borrower’s name or any such Subsidiary’s name and at a bank identified in Disclosure Schedule (4.19) (each, a “ Relationship Bank ”).

          (b) As of the Closing Date, each Relationship Bank shall have entered into an Account Control Agreement with Agent, for the benefit of itself and Lenders, and the applicable

Borrower, governing all Bank Accounts with such Relationship Bank. As of the Closing Date, the Borrowers shall maintain one or more lockbox accounts (individually and collectively, the “ Lockbox Account ”) with one or more banks acceptable to Agent (each, a “ Lockbox Bank ”), and shall execute with each Lockbox Bank one or more agreements acceptable to Agent (individually and collectively, the “ Lockbox Agreement ”), and such other agreements related thereto as Agent may require. Borrowers shall ensure that all collections of Borrowers’ Accounts and all other cash payments received by Borrowers are paid and delivered directly from Account Debtors and other Persons into the appropriate Lockbox Account. The Lockbox Agreements shall provide that upon receipt of written notice from Agent the Lockbox Banks immediately will transfer all funds paid into the Lockbox Accounts into a depository account or accounts (specified in the Lockbox Agreement or to be specified in such written notice) maintained by Agent or an Affiliate of Agent at such bank as Agent may communicate to Borrower from time to time (the “ Concentration Account ”). Notwithstanding and without limiting any other provision of any Loan Document, Agent shall apply, on a daily basis, all funds transferred into the Concentration Account pursuant to the Lockbox Agreement and this Section 2.5(b) in such order and manner as determined by Agent. Except to the extent applied to reduce the obligations under the Bridge Loan and related Bridge Loan Documents, all funds transferred to the Concentration Account for application to the Obligations under this Agreement shall be applied to reduce the Obligations under this Agreement. If as the result of collections of Accounts and/or any other cash payments received by any Borrower pursuant to this Section 2.5(b) a credit balance exists with respect to the Concentration Account, such credit balance shall not accrue interest in favor of a Borrower, but shall be available to Borrowers upon Borrowers’ written request. If applicable, at any time prior to the execution of all or any of the Lockbox Agreements and operation of all or any of the Lockbox Accounts, Borrowers and each Affiliate of a Borrower shall direct all collections or proceeds it receives on Accounts or from other Collateral to the account(s) and in the manner specified by Agent in its sole discretion.

          (c) So long as no Event of Default has occurred and is continuing, Borrower may amend Disclosure Schedule (4.19) to add or replace a Relationship Bank or Bank Account; provided , that prior to the time of the opening of such account, any Borrower or its Subsidiaries, as applicable, and such bank shall have executed and delivered to Agent an Account Control Agreement and a Lockbox Agreement. Each Borrower shall close any of its accounts (and establish replacement accounts in accordance with the foregoing sentence) promptly and in any event within sixty (60) days following notice from Agent that the creditworthiness of any bank holding an account is no longer acceptable in Agent’s reasonable judgment, or as promptly as practicable and in any event within ninety (90) days following notice from Agent that the operating performance, funds transfer or availability procedures or performance with respect to accounts of the bank holding such accounts or Agent’s liability under any Account Control Agreement with such bank is no longer acceptable in Agent’s reasonable judgment.

          (d) The Bank Accounts shall be cash collateral accounts, with all cash, checks and other similar items of payment in such accounts securing payment of the Loans and all other Obligations, and in which each Borrower and each Subsidiary thereof shall have granted a Lien to Agent, on behalf of itself and Lenders, pursuant to the Security Agreement.

          (e) Each Borrower shall and shall cause its Affiliates, officers, employees, agents, directors or other Persons acting for or in concert with Borrower (each a “ Related

           Person ”) to (i) hold in trust for Agent, for the benefit of itself and Lenders all checks, cash and other items of payment received by such Borrower or any such Related Person in respect of such Borrower or any of the Collateral, and (ii) within five (5) Business Day after receipt by such Borrower or any such Related Person of any such checks, cash or other items of payment, deposit the same into a Lockbox Account. Each Borrower on behalf of itself and each Related Person acknowledges and agrees that all cash, checks or other items of payment constituting proceeds of Collateral are part of the Collateral. All proceeds of the sale or other disposition of any Collateral not paid directly to the Agent shall be deposited directly into a Lockbox Account.

          (f) Each Bank Account shall at all times be subject to an Account Control Agreement and each Lockbox Account shall at all times be subject to a Lockbox Agreement.

     2.6 Fees .

          (a) On the Closing Date, as additional compensation, the Borrowers shall pay to Agent solely for Agent’s benefit a commitment fee in the amount set forth in the Fee Letter.

          (b) As additional compensation for the Lenders, the Borrowers shall pay to Agent, for the ratable (as may be adjusted to reflect the revision of Commitments during any Fiscal Quarter as a result of a Commitment Increase pursuant to Section 2.15 hereof) benefit of Lenders, in arrears, on the first Business Day of each month prior to the Commitment Termination Date for the immediately preceding month, commencing with the month ending on November 30, 2005 (which first payment shall cover the period from the Closing Date to such date), and on the Commitment Termination Date, an unused commitment fee in the amount set forth in the Fee Letter (the “ Unused Line Fee ”) for the Borrowers’ non-use of available funds.

          (c) In the event the Agent and the Requisite Lenders approve a Commitment Increase, the Borrowers agree to pay to Agent solely for Agent’s benefit, as additional compensation, an additional commitment fee in the amount set forth in the Fee Letter (the “ Additional Commitment Fee ”), which additional fee shall be due and payable at the time Agent notifies the Borrowers in writing that sufficient Increase Lenders have committed to funding such Commitment Increase.

          (d) In the event Borrowers terminate the Commitments prior to the Commitment Termination Date, Borrowers shall pay the applicable Termination Fee in accordance with Section 2.2(a) .

     2.7 Receipt of Payments .

          The Borrowers shall make each payment under this Agreement not later than 2:00 p.m. (New York time) on the day when due in immediately available funds in Dollars to the Collection Account. For purposes of computing interest and Fees and determining Borrowing Availability as of any date, all payments shall be deemed received on the Business Day on which immediately available funds therefor are received in the Collection Account prior to 2:00 p.m. New York time. Payments received after 2:00 p.m. New York time on any Business Day or on a day that is not a Business Day shall for such purposes be deemed to have been received on the following Business Day.

     2.8 Application and Allocation of Payments .

          (a) So long as no Event of Default has occurred and is continuing, (i) payments matching specific scheduled payments then due shall be applied to those scheduled payments; (ii) voluntary prepayments shall be applied in accordance with the provisions of Section 2.2(a) ; and (iii) mandatory prepayments shall be applied as set forth in Sections 2.2(b) and 2.2(c) , as applicable. All payments and prepayments applied to a particular Loan shall be applied ratably to the portion thereof held by each Lender as determined by its Pro Rata Share. As to any other payment, and as to all payments made when an Event of Default has occurred and is continuing or following the Termination Date, each Borrower hereby irrevocably waives the right to direct the application of any and all payments received from or on behalf of any Borrower, and each Borrower hereby irrevocably agrees that Agent shall have the continuing exclusive right to apply any and all such payments against the Obligations as Agent may deem advisable notwithstanding any previous entry by Agent in the Loan Account or any other books and records or anything in this Agreement to the contrary. In the absence of a specific determination by Agent with respect thereto, payments shall be applied to amounts then due and payable in the following order: (1) to Agent’s and any Lender’s expenses reimbursable hereunder (including, without limitation, to the extent reimbursable under Section 13.3) ; (2) to any outstanding Fees; (3) to interest on Base Rate Loans; (4) to interest on LIBOR Loans, ratably in the order of maturity; (5) to all then outstanding obligations under any interest rate cap, swap or collar agreements, or other agreements or arrangements secured by the Loan Documents designed to provide protection against fluctuations in interest rates permitted hereunder, to the extent the amount owed corresponds to interest on the notional amount thereof; (6) to the principal amount of the Loan and all other outstanding Obligations; and (7) to all other outstanding obligations under any interest rate cap, swap or collar agreements, or other agreements or arrangements secured by the Loan Documents designed to provide protection against fluctuations in interest rates permitted hereunder.

          (b) Agent is authorized to, and at its sole election may, charge to the Loan balance on behalf of the Borrowers and cause to be paid all Fees, expenses, Taxes, Charges, costs (including insurance premiums in accordance with Section 6.4(a) ) and interest and principal, other than principal of the Loan, owing by the Borrowers under this Agreement or any of the other Loan Documents if and to the extent the Borrowers fail to pay promptly any such amounts as and when due, after receipt of notice from Agent, even if the amount of such charges would exceed Borrowing Availability at such time. At Agent’s option and to the extent permitted by law, any charges so made shall constitute part of the Loan hereunder.

     2.9 Loan Account and Accounting .

          Agent shall maintain a loan account (the “ Loan Account ”) on its books to record: all Advances, all payments made by or on behalf of the Borrowers, and all other debits and credits as provided in this Agreement with respect to the Loans or any other Obligations. All entries in the Loan Account shall be made in accordance with Agent’s customary accounting practices as in effect from time to time. The balance in the Loan Account, as recorded on Agent’s most recent printout or other written statement, shall, absent manifest error, be presumptive evidence of the amounts due and owing to Agent and Lenders by the Borrowers; provided that any failure to so record or any error in so recording shall not limit or otherwise

affect the Borrowers’ duty to pay the Obligations. Upon request (but not more frequently than monthly), Agent shall render to the Borrowers a monthly accounting of transactions with respect to the Loans setting forth the balance of the Loan Account for the immediately preceding month. Unless the Borrowers notify Agent in writing of any objection to any such accounting (specifically describing the basis for such objection), within fifteen (15) days after the date thereof, each and every such accounting shall be presumptive evidence of all matters reflected therein. Only those items expressly objected to in such notice shall be deemed to be disputed by the Borrowers. Notwithstanding any provision herein contained to the contrary, any Lender may elect (which election may be revoked) to dispense with the issuance of any Notes to that Lender and may rely on the Loan Account as evidence of the amount of Obligations from time to time owing to it.

     2.10 Indemnity .

          (a) Each Borrower shall jointly and severally indemnify and hold harmless each of Agent, Lenders and their respective Affiliates, and each such Person’s respective officers, directors, employees, attorneys, agents and representatives (each, an “ Indemnified Person ”), from and against any and all suits, actions, proceedings, claims, damages, losses, liabilities and expenses (including reasonable in-house and external attorneys’ fees and disbursements and other costs of investigation or defense, including those incurred upon any appeal) that may be instituted or asserted against or incurred by any such Indemnified Person as the result of the execution, delivery and/or performance of the Loan Documents, credit having been extended, suspended or terminated under this Agreement and the other Loan Documents and the administration of such credit, and in connection with or arising out of the transactions contemplated hereunder and thereunder and any actions or failures to act in connection therewith, including any and all Environmental Liabilities and legal costs and expenses arising out of or incurred in connection with disputes between or among any parties to any of the Loan Documents (collectively, “ Indemnified Liabilities ”); provided , that no such Borrower shall be liable for any indemnification to an Indemnified Person to the extent that any such suit, action, proceeding, claim, damage, loss, liability or expense results from that Indemnified Person’s gross negligence or willful misconduct as finally determined by a court of competent jurisdiction. NO INDEMNIFIED PERSON SHALL BE RESPONSIBLE OR LIABLE TO ANY OTHER PARTY TO ANY LOAN DOCUMENT, ANY SUCCESSOR, ASSIGNEE OR THIRD PARTY BENEFICIARY OF SUCH PERSON OR ANY OTHER PERSON ASSERTING CLAIMS DERIVATIVELY THROUGH SUCH PARTY, FOR INDIRECT, PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES WHICH MAY BE ALLEGED AS A RESULT OF CREDIT HAVING BEEN EXTENDED, SUSPENDED OR TERMINATED UNDER ANY LOAN DOCUMENT OR AS A RESULT OF ANY OTHER TRANSACTION CONTEMPLATED HEREUNDER OR THEREUNDER.

          (b) To induce Lenders to provide the LIBOR Rate option on the terms provided herein, if (i) any LIBOR Loans are repaid in whole or in part prior to the last day of any applicable LIBOR Period (whether that repayment is made pursuant to any provision of this Agreement or any other Loan Document or occurs as a result of acceleration, by operation of law or otherwise); (ii) the Borrowers shall default in payment when due of the principal amount of or interest on any LIBOR Loan; (iii) the Borrowers shall refuse to accept any borrowing of, or shall request a termination of any borrowing, conversion into or continuation of LIBOR Loans after

the Borrowers have given notice requesting the same in accordance herewith; or (iv) the Borrowers shall fail to make any prepayment of a LIBOR Loan after the Borrowers have given a notice thereof in accordance herewith, then the Borrowers shall indemnify and hold harmless the Agent and each Lender from and against all losses, costs and expenses resulting from or arising from any of the foregoing. Such indemnification shall include any loss (including loss of margin) or expense arising from the reemployment of funds obtained by it or from fees payable to terminate deposits from which such funds were obtained. For the purpose of calculating amounts payable to a Lender under this subsection, each Lender shall be deemed to have actually funded its relevant LIBOR Loan through the purchase of a deposit bearing interest at the LIBOR Rate in an amount equal to the amount of that LIBOR Loan and having a maturity comparable to the relevant LIBOR Period; provided , that each Lender may fund each of its LIBOR Loans in any manner it sees fit, and the foregoing assumption shall be utilized only for the calculation of amounts payable under this subsection. This covenant shall survive the termination of this Agreement and the payment of the any Notes and all other amounts payable hereunder. As promptly as practicable under the circumstances, each Lender shall provide the Borrowers with its written calculation in reasonable detail of all amounts payable pursuant to this Section 2.10(b) , and such calculation shall be binding on the parties hereto unless the Borrowers shall object in writing within fifteen (15) Business Days of receipt thereof, specifying the basis for such objection in detail.

     2.11 Access .

          Each Borrower that is a party hereto shall, during normal business hours, from time to time not more than four times in any year, at Borrower’s expense, except if an Event of Default has occurred and is continuing, in which case no such notice shall be required: (a) provide Agent and any of its officers, employees and agents access to its properties, facilities, advisors, officers and employees, books, records, contracts and Accounts of each Borrower and to the Collateral (provided that access to officers, employees and agents shall be provided promptly, but in no event upon more than five (5) Business Days’ prior notice), (b) permit Agent, and any of its officers, employees, designees and agents, to inspect, audit and make extracts from any Borrower’s books and records, contracts and Accounts, and (c) permit Agent, and its officers, employees, designees and agents, to inspect, review, evaluate and make test verifications and counts of the contracts, Accounts, Inventory and other Collateral of any Borrower. If an Event of Default has occurred and is continuing, each Borrower shall provide such access to Agent and to each Lender (and their respective agents and designees) during normal business hours without advance notice. Furthermore, so long as any Event of Default has occurred and is continuing, the Borrowers shall provide Agent and each Lender with access to its suppliers and Subscribers. Lenders agree to use their commercially reasonable efforts to coordinate all such access with those of Agent and Agent and Lenders shall use their commercially reasonable efforts to provide the Borrowers copies of any written correspondence with Subscribers, provided that no liability shall accrue to the Agent or any Lender for failure to deliver any such correspondence to the Borrowers. Each Borrower shall make available to Agent and its counsel, reasonably promptly, originals or copies of all books, records, contracts and Accounts that Agent may reasonably request. Each Borrower shall deliver any document or instrument necessary for Agent, as it may from time to time reasonably request, to obtain records from any storage facility, bailee, service bureau or other Person that maintains records for such Borrower.

     2.12 Taxes .

          (a) Any and all payments by the Borrowers hereunder or under any Note shall be made, in accordance with this Section 2.12 , free and clear of and without deduction for any and all present or future Indemnified Taxes and Other Taxes. If the Borrowers shall be required by law to deduct any Indemnified Taxes from or in respect of any sum payable hereunder or under the any Note, (i) the sum payable shall be increased as much as shall be necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section 2.12 ), Agent or Lenders, as applicable, shall receive an amount equal to the sum they would have received had no such deductions been made, (ii) the Borrowers shall make such deductions, and (iii) the Borrowers shall pay the full amount deducted to the relevant Governmental Authority in accordance with applicable law (except for any Indemnified Taxes or other liabilities that the Borrowers are contesting in good faith by appropriate proceedings). Within thirty (30) days after the date of any payment of Indemnified Taxes, the Borrowers shall furnish to Agent the original or a certified copy of a receipt evidencing payment thereof, to the extent such a receipt has been issued therefor, or such other written proof of payment thereof that is reasonably satisfactory to Agent.

          (b) Each Borrower that is a signatory hereto shall indemnify and, within thirty (30) days of written demand therefor, pay Agent and each Lender for the full amount of Indemnified Taxes and Other Taxes (including any Indemnified Taxes and Other Taxes imposed by any jurisdiction on amounts payable under this Section 2.12 ) paid by Agent or such Lender, as appropriate, and any liability (including penalties, interest and expenses) arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or legally asserted. Agent and such Lender, as applicable, shall include with any such written demand a statement setting forth in reasonable detail the basis and calculation of any such payment or indemnity hereunder, which statement shall, in the absence of demonstrable error, be conclusive and binding as to the amount thereof.

          (c) On or prior to the date of its execution and delivery of this Agreement in the case of each Lender that is listed on the signature pages of this Agreement, and on or prior to the date of the assignment pursuant to Section 11.1 pursuant to which it becomes a Lender in the case of each other Lender, and from time to time thereafter as reasonably requested in writing by the Borrowers or Agent (but only so long thereafter as such Lender remains lawfully able to do so):

               (i) each Lender that is a Non-Corporate Domestic Lender shall provide to the Borrowers (with a copy to Agent) an original IRS Form W-9, or any successor or other form prescribed by the IRS, properly completed and duly executed under penalties of perjury; and

               (ii) each Lender that is a Foreign Lender shall provide to the Borrowers (with a copy to Agent) either:

                    (A) an original IRS Form W-8BEN or W-8IMY, as appropriate, or any successor or other form prescribed by the IRS, properly completed and duly executed

under penalties of perjury, certifying that such Lender is entitled to a zero (0) rate of United States withholding tax on payments made pursuant to this Agreement or any Notes,

                    (B) an original IRS Form W-8ECI, or any successor other form prescribed by the IRS, properly completed and duly executed under penalties of perjury, certifying that such Lender is exempt from United States withholding tax on payments made pursuant to this Agreement or any Notes, or

                    (C) in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Code Section 881(c), a certificate, duly executed under penalties of perjury, that it is not (I) a “ bank ” (within the meaning of Code Section 881(c)(3)(A)), (II) a “ ten percent shareholder ” (within the meaning of Code Section 871(h)(3)(B)) of any Borrower, or (III) a “ controlled foreign corporation ” related to any Borrower (within the meaning of the Code Section 864(d)(4)), and an original IRS Form W-8BEN or Form W-8IMY, as appropriate, or any successor or other form prescribed by the IRS, properly completed and duly executed under penalties of perjury, certifying that such Lender is exempt from United States withholding tax on payments made pursuant to this Agreement or any Notes.

Each Lender shall deliver such new forms and documents prescribed by the IRS upon the expiration or obsolescence of any previously delivered forms or other documents referred to in this Section 2.12(c) or after the occurrence of any event requiring a change in the most recent forms or other documents delivered by such Lender. Such Lender shall promptly provide written notice to the Borrowers (with a copy to Agent) at any time it determines that it is no longer in a position to provide any previously delivered form or other document (or any other form of certification adopted by the IRS for such purpose).

          (d) No Default . In no event shall any withholding by any Borrower, as contemplated by this Section 2.12 , on any payment under this Agreement or any Note give rise to a Default under Section 10.1 .

          (e) Mitigation . Each Lender agrees that it shall, to the extent reasonable and without any additional cost (other than costs which the Borrowers have paid to such Lender, unless waived by the Lender) or risk to it, (i) take all actions reasonably requested by the Borrowers or Agent to maintain all exemptions, if any, available to it from United States withholding tax (whether available by treaty, statute, or existing administrative waiver), and (ii) otherwise cooperate with the Borrowers to minimize any amounts payable by the Borrowers pursuant to this Section 2.12 .

          (f) Treatment of Certain Refunds . If Agent or any Lender determines, in its sole discretion, that it is entitled to receive a refund (whether by way of a direct payment or by offset) of any Indemnified Taxes or Other Taxes that would reasonably be considered allocable to or resulting from any increase in the amounts paid by the Borrowers or any indemnification by any Borrower pursuant to this Section 2.12 , it shall promptly notify the Borrowers of the availability of such refund and shall, within thirty (30) days after the receipt of a request from the Borrowers at the Borrowers’ sole cost and expense, apply for such refund with the Borrowers being responsible for any incremental costs associated with such refund request. If Agent or any Lender determines, in its sole discretion, that it has received a refund (as described in the

preceding sentence), it shall pay to the Borrowers, within thirty (30) days from the date of such receipt, an amount equal to such refund (but only to the extent of indemnity payments made, or additional amounts paid, by the Borrowers under this Section with respect to the Indemnified Taxes or Other Taxes giving rise to such refund), net of all out-of-pocket expenses of Agent or such Lender, as the case may be, and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund); provided that the Borrowers, upon the request of Agent or such Lender to the Borrowers, agrees to repay the amount paid over to the Borrowers (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) to Agent or such Lender in the event Agent or such Lender is required to repay such refund to such Governmental Authority. This subsection shall not be construed to require Agent or any Lender to make available its tax returns (or any other information relating to its Taxes that it deems confidential) to the Borrowers or any other Person.

     2.13 Capital Adequacy; Increased Costs; Illegality .

          (a) If any law, treaty, governmental (or quasi-governmental) rule, regulation, guideline or order regarding capital adequacy, reserve requirements or similar requirements or compliance by any Lender with any request or directive regarding capital adequacy, reserve requirements or similar requirements (whether or not having the force of law), in each case, adopted or made after the Closing Date, from any central bank or other Governmental Authority increases or would have the effect of increasing the amount of capital, reserves or other funds required to be maintained by such Lender and thereby reducing the rate of return on such Lender’s capital as a consequence of its obligations hereunder, then the Borrowers shall from time to time promptly after demand by such Lender (with a copy of such demand to Agent) pay to Agent for the account of such Lender, additional amounts sufficient to compensate such Lender for such reduction, provided that the Borrowers shall not be required to compensate a Lender pursuant to this Section for any such additional amounts incurred more than six months prior to the date that such Lender notifies the Borrowers of the change in law giving rise to such additional amount; provided further, that if the change resulting in such increased costs is retroactive, then such six month period shall be extended to include the retroactive period. A certificate as to the amount of that reduction and showing in reasonable detail the basis of the computation thereof submitted by such Lender to the Borrowers and to Agent shall be presumptive evidence of the matters set forth therein.

          (b) If, due to either (i) the introduction of or any change in any law or regulation (or any change in the interpretation thereof) or (ii) the compliance with any published guideline from any central bank or other Governmental Authority (whether or not having the force of law) applicable generally to banks or any class of banks within the same jurisdiction (but not any guideline specifically required of a single bank), in each case adopted or made after the Closing Date, there shall be any increase in the cost to any Lender of agreeing to make or making, funding or maintaining any LIBOR Loan (other than any such increase in cost resulting from (A) Indemnified Taxes or Other Taxes (as to which Section 2.12 shall govern), (B) the imposition of, or any change in the rate of, any Excluded Tax payable by such Lender, or (C) changes reflected in the LIBOR Rate) then Borrowers shall from time to time promptly after demand by such Lender (with a copy of such demand to Agent), pay to Agent promptly for the account of such Lender additional amounts sufficient to compensate such Lender for such increased cost; provided that Borrowers shall not be required to compensate a Lender pursuant to

this Section for any such additional amount incurred more than six (6) months prior to the date that such Lender notifies Borrowers of the change in law giving rise to such additional amount; provided further, that if the change resulting in such increased costs is retroactive, then such six (6) month period shall be extended to include the retroactive period. A certificate showing in reasonable detail the amount of such increased cost, submitted to Borrowers and to Agent by such Lender, shall be presumptive evidence of the matters set forth therein. Each Lender agrees that, as promptly as practicable after it becomes aware of any circumstances referred to above which would result in any such increased cost, the affected Lender shall, to the extent not inconsistent with such Lender’s internal policies of general application, use reasonable commercial efforts to minimize costs and expenses incurred by it and payable to it by Borrowers pursuant to this Section 2.13(b) .

          (c) Notwithstanding anything to the contrary contained herein, if the introduction of or any change in any law or regulation (or any change in the interpretation thereof) after the date hereof shall make it unlawful, or any central bank or other Governmental Authority shall assert after the date hereof that it is unlawful, for any Lender to agree to make or to make or to continue to fund or maintain any LIBOR Loan, then, unless that Lender is able to make or to continue to fund or to maintain such LIBOR Loan at another branch or office of that Lender without, in that Lender’s reasonable opinion, materially adversely affecting it or its Loans or the income obtained therefrom, on notice thereof and demand therefor by such Lender to Borrowers through Agent, (i) the obligation of such Lender to agree to make or to make or to continue to fund or maintain LIBOR Loans shall terminate and (ii) Borrowers shall forthwith prepay in full all outstanding LIBOR Loans owing to such Lender, together with interest accrued thereon, unless Borrowers, within five (5) Business Days after the delivery of such notice and demand, converts all LIBOR Loans of such Lender into Base Rate Loans.

          (d) Within sixty (60) days after receipt by Borrowers of written notice and demand from any Lender (an “ Affected Lender ”) for payment of additional amounts or increased costs as provided in Sections 2.12(a) , 2.12(b) , 2.13(a) or 2.13(b) , Borrowers may, at its option, notify Agent and such Affected Lender of its intention to replace the Affected Lender. So long as no Event of Default has occurred and is continuing, Borrowers, with the consent of Agent, which consent shall not be unreasonably withheld or delayed, may obtain, at the Borrowers’ expense, a replacement Lender (“ Replacement Lender ”) for the Affected Lender, which Replacement Lender must be reasonably satisfactory to Agent. If the Borrowers obtain a Replacement Lender within one hundred eighty (180) days following notice of its intention to do so, the Affected Lender must sell and assign its Loans and Commitments to such Replacement Lender for an amount equal to the principal balance of all Loans held by the Affected Lender and all accrued interest and Fees with respect