SC 13D

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

___________________

SCHEDULE 13D

(Rule 13d-101)

INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO §240.13d-1(a) AND

AMENDMENTS THERETO FILED PURSUANT TO §240.13d-2(a)

UNDER THE SECURITIES EXCHANGE ACT OF 1934

SALARY.COM, INC.

(Name of Issuer)

Common Stock, par value $0.0001 per share

(Title of Class of Securities)

794006106

(CUSIP Number)

Nooruddin S. Karsan

Chief Executive Officer

Kenexa Corporation

650 East Swedesford Road

Wayne, Pennsylvania 19087

(610) 971-9171

(Name, Address and Telephone Number of Person

Authorized to Receive Notices and Communications)

August 31, 2010

(Date of Event which Requires Filing

of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 13d-1(f) or 13d-1(g), check the following box: p

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See § 240.13d-7(b) for other parties to whom copies are to be sent.

* The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

CUSIP No.  794006106

1	NAME OF REPORTING PERSON: Kenexa Corporation S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY):   23-3024013
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP                  (a)      o      (b)      x
3	SEC USE ONLY
4	SOURCE OF FUNDS WC, See Item 3
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e)                                                              o
6	CITIZENSHIP OR PLACE OF ORGANIZATION Pennsylvania
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER -0-
		8	SHARED VOTING POWER 5,855,424*
		9	SOLE DISPOSITIVE POWER -0-
		10	SHARED DISPOSITIVE POWER 5,855,424*
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 5,855,424*
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES                                                                                      o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 33.0%**
14	TYPE OF REPORTING PERSON CO

* Beneficial ownership of the common stock referred to herein is being reported hereunder solely because Kenexa Corporation may be deemed to have beneficial ownership, as a result of the Tender Agreement (described further in Items 4 and 5 of this Schedule 13D) among Kenexa Corporation, Spirit Merger Sub, Inc. and the Significant Stockholders (as defined below) of 5,855,424 shares of Salary.com, Inc. common stock. The filing of this Schedule 13D shall not be construed as an admission that Kenexa Corporation is, for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended, or for any other purpose, the beneficial owner of any of such shares of Salary.com, Inc., and such beneficial ownership is expressly disclaimed.

** Based on 17,731,076 common shares of Salary.com, Inc. issued and outstanding as of August 31, 2010, as reported by Salary.com, Inc. on its Schedule 14D-9 filed with the SEC on September 2, 2010.

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CUSIP No.  794006106

1	NAME OF REPORTING PERSON: Spirit Merger Sub, Inc. S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON (ENTITIES ONLY):
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP                  (a)      o      (b)     x
3	SEC USE ONLY
4	SOURCE OF FUNDS AF, See Item 3
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e)                                                              o
6	CITIZENSHIP OR PLACE OF ORGANIZATION Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH		7	SOLE VOTING POWER -0-
		8	SHARED VOTING POWER 5,855,424*
		9	SOLE DISPOSITIVE POWER -0-
		10	SHARED DISPOSITIVE POWER 5,855,424*
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 5,855,424*
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES                                                                                       o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 33.0%**
14	TYPE OF REPORTING PERSON CO

* Beneficial ownership of the common stock referred to herein is being reported hereunder solely because Kenexa Corporation may be deemed to have beneficial ownership, as a result of the Tender Agreement (described further in Items 4 and 5 of this Schedule 13D) among Kenexa Corporation, Spirit Merger Sub, Inc. and the Significant Stockholders (as defined below) of 5,855,424 shares of Salary.com, Inc. common stock. The filing of this Schedule 13D shall not be construed as an admission that Kenexa Corporation is, for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended, or for any other purpose, the beneficial owner of any of such shares of Salary.com, Inc., and such beneficial ownership is expressly disclaimed.

** Based on 17,731,076 common shares of Salary.com, Inc. issued and outstanding as of August 31, 2010, as reported by Salary.com, Inc. on its Schedule 14D-9 filed with the SEC on September 2, 2010.

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Item 1. Security and Issuer

This statement on Schedule 13D relates to the common stock, par value $0.0001 per share (the “Shares”), of Salary.com, Inc., a Delaware corporation (“Salary.com”). The principal executive offices of Salary.com are located at 160 Gould Street, Needham, Massachusetts 02494.

Item 2. Identity and Background

(a)-(c) and (f) This statement is being jointly filed by each of the following persons pursuant to Rule 13d-1(k)(1) promulgated by the Securities and Exchange Commission (the “Commission”) pursuant to Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”):

     (i) Kenexa Corporation, a Pennsylvania corporation (“Kenexa”), and

     (ii) Spirit Merger Sub, Inc. (“Merger Sub”), a Delaware corporation and wholly owned subsidiary of Kenexa.

Each of Kenexa and Merger Sub are collectively referred to as the “Reporting Persons.” The Reporting Persons have entered into a Joint Filing Agreement, dated the date hereof, a copy of which is filed with this Schedule 13D as Exhibit 99.1 (which is hereby incorporated by reference) pursuant to which the Reporting Persons have agreed to file this statement jointly in accordance with the provisions of Rule 13d-1(k)(1) under the Exchange Act. The Reporting Persons expressly disclaim that they have agreed to act as a group other than as described in this statement.

Pursuant to Rule 13d-4 of the Exchange Act, the Reporting Persons expressly declare that the filing of this statement shall not be construed as an admission that any such person is, for the purposes of Section 13(d) and/or Section 13(g) of the Exchange Act or otherwise, the beneficial owner of any securities covered by this statement held by any other person.

The address of the principal business office of each of the Reporting Persons is 650 East Swedesford Road, Wayne, Pennsylvania 19087. Kenexa is a global provider of business solutions for human resources. Merger Sub is a newly formed Delaware corporation and a wholly owned subsidiary of Kenexa that was formed for the purpose of acquiring all of the outstanding shares of Salary.com. Merger Sub has not conducted, and does not expect to conduct, any business other than in connection with the potential acquisition of all the outstanding shares of Salary.com and the merger of Merger Sub with and into Salary.com.

Certain information required by this Item 2(a)-(c) and (f) concerning the directors and executive officers of each of the Reporting Persons is set forth on Schedule I annexed hereto, which is incorporated herein by reference.

(d)-(e) Within the past five years, none of the Reporting Persons and, to the knowledge of the Reporting Persons, after due inquiry, none of the persons set forth on Schedule I, has been convicted in any criminal proceeding (excluding traffic violations or similar misdemeanors) or has been a party to any civil proceeding and as a result thereof was or is subject to any judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to federal or state securities laws or finding any violations with respect to such laws.

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Item 3. Source and Amount of Funds or Other Considerations

The aggregate consideration to be paid by Merger Sub to purchase all of the Shares pursuant to the Offer, to consummate the Merger is approximately $80 million. Merger Sub intends to obtain such funds by means of a capital contribution from Kenexa. Kenexa will ensure that Merger Sub has sufficient funds to acquire all of the outstanding Shares pursuant to the Offer and the Merger.

On August 31, 2010, Kenexa Technology, Inc. (“KTI”) entered into a secured credit agreement (the “Credit Agreement”) with PNC Bank, National Association, as administrative agent, and the lenders party thereto. The maximum amount available under the revolving secured credit facility is $25,000,000 including a sublimit of up to $2,000,000 for letters of credit. The Credit Agreement will terminate, and all borrowings will become due and payable, on August 30, 2013. Kenexa and each of the U.S. subsidiaries (other than the New York and Puerto Rico subsidiaries) (collectively, the “Guarantors”) are guarantors of the obligations under the Credit Agreement. Borrowings under the new credit facility are secured by substantially all of KTI’s, Kenexa’s and the Guarantor’s assets (including a pled ge of the capital stock of their subsidiaries (but limited to only 65% of the voting stock of first-tier foreign subsidiaries)).

KTI’s borrowings under the Credit Agreement bear interest at either the LIBOR Rate plus 225 basis points or the Base Rate plus 125 basis points. Interest on LIBOR borrowings is calculated on an actual/360 day basis and is paid on the last day of each interest period. LIBOR advances are available for periods of 1, 2, 3 or 6 months. LIBOR pricing is adjusted for any statutory reserves.

 The foregoing discussion does not purport to be complete and is qualified in its entirety by reference to the terms of Credit Agreement, a copy of which is referenced as Exhibit 10.1 hereto and is incorporated herein by reference.

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Item 4. Purpose of the Transaction.

(a)-(b) On August 31, 2010, Kenexa, Salary.com and Merger Sub entered into an Agreement and Plan of Merger (the “Merger Agreement”) pursuant to which (i) Merger Sub has commenced a cash tender offer (the “Offer”) to purchase all of the Shares at a price per share equal to $4.07, net to the sellers in cash without interest thereon and less any applicable withholding taxes (the “Offer Price”), and (ii) following consummation of the Offer, Merger Sub will merge with and into Salary.com (the “Merger”), with Salary.com as the surviving corporation, pursuant to which each outstanding Share will be converted into the right to receive the Offer Price, except for those Shares held by Salary.com, Kenexa or Merger Sub, and other than those Shares with respect to which statutory rights of appraisal und er Section 262 of the Delaware General Corporation Law have been perfected.

In connection with the Merger Agreement, on August 31, 2010, contemporaneously with the execution of the Merger Agreement, Bryce Chicoyne, G. Kent Plunkett, Yong Zhang, Paul Daoust, John Gregg, Edward McCauley, John Sumser, Terry Temescu, Robert Trevisani, William Martin, Teresa Shipp, Brent Kleiman, Judy Duff and Nicholas Camelio and certain of their affiliates (together, the “Significant Stockholders”) entered into a tender and support agreement with and in favor of Kenexa and Merger Sub (the “Tender Agreement”), pursuant to which, among other things, each Significant Stockholder has agreed to tender in the Offer, and not withdraw, all of the Shares beneficially owned by the Significant Stockholder, as well as any other Shares acquired by the Significant Stockholder after the date of the Tender Agreement. Each S ignificant Stockholder is required to tender their Shares not later than the tenth business day after commencement of the Offer, or with respect to any Shares acquired after the date of the Tender Agreement, prior to the expiration of the Offer.

(c) Not applicable.

(d) Under the Merger Agreement, after Merger Sub accepts for payment Shares validly tendered in the Offer, Merger Sub is entitled to designate a number of directors, rounded up to the next whole number, to the board of directors of Salary.com and its subsidiaries that is equal to the total number of directors on Salary.com’s board of directors (giving effect to the directors elected or appointed pursuant to this sentence) multiplied by the percentage that the Shares beneficially owned by Merger Sub and its subsidiaries (including Shares accepted for payment pursuant to the Offer) bears to the total number of Shares then outstanding; provided that the number of Merger Sub designees constitute a majority of the Salary.com board of directors.

(e) Unless Kenexa has given its prior written consent, the Merger Agreement prohibits Salary.com from (i) issuing, delivering, selling, pledging, transferring, disposing of or encumbering any shares of capital stock or other equity or voting interests of Salary.com or its subsidiaries or any securities convertible into, exchangeable or exercisable for or representing the right to subscribe for, purchase or otherwise receive any such shares or interests or any stock appreciation rights, “phantom” stock rights, performance units, rights to receive shares of capital stock or other rights that are linked to the value of Salary.com common stock or the value of Salary.com or its subsidiaries or any part thereof; (ii) effecting any stock split, stock combination, stock reclassification, reverse stock split, stock dividend, recapital ization or other similar transaction; or (iii) granting, conferring or awarding any option, right, warrant, deferred stock unit, conversion right or other right not existing on the date of the Merger Agreement to acquire any of its shares of capital stock or shares of deferred stock, restricted stock awards, restricted stock units, stock appreciation rights, “phantom” stock awards or other similar rights that are linked to the value of Shares or the value of Salary.com or its subsidiaries or any part thereof (whether or not pursuant to existing Salary.com stock plans).

(f) Upon consummation of the Merger, Salary.com will become a wholly owned subsidiary of Kenexa.

(g) The Merger Agreement contains provisions that limit the ability of Salary.com to engage in a transaction that would involve a change of control of Salary.com during the pendency of the Merger Agreement. Following consummation of the Offer, Merger Sub will own no less than a majority of Salary.com’s issued and outstanding capital stock and will therefore be able to block any acquisition of control of Salary.com by any other person.

(h) Upon consummation of the Merger, the Shares will cease to be quoted on any quotation system or exchange.

(i) Upon consummation of the Merger, the Shares will become eligible for termination of registration pursuant to Section 12(g)(4) of the Exchange Act.

(j) Other than as described above, Kenexa currently has no plan or proposal which relates to, or may result in, any of the matters listed in Items 4(a)-(i) of this Schedule 13D (although Kenexa reserves the right to develop such plans).

The descriptions contained in this Item 4 of the transactions contemplated by the Merger Agreement and the Tender Agreement do not purport to be complete and are qualified in their entirety by reference to the terms of the Merger Agreement and Tender Agreement, copies of which are referenced as Exhibit 2.1 and Exhibit 2.2 hereto, respectively, and are incorporated herein by reference.

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Item 5. Interest in Securities of the Issuer.

(a)-(b) Neither Kenexa nor Merger Sub directly own any outstanding Shares. However, as described in Item 4 (a)-(b) of this Schedule 13D, as a result of the Tender Agreement, Kenexa and Merger Sub have the power to vote the Shares with respect to certain matters relating to the Merger as set forth in the Tender Agreement (see Item 4 of this Schedule 13D for details). The Shares currently consist of 5,855,424 shares of common stock of Salary.com, which represent approximately 33.0% of the outstanding shares of common stock of Salary.com as of August 31, 2010. The Significant Stockholders retain the sole power to vote the Shares on all matters other than those identified in the Tender Agreement. Pursuant to the Tender Agreement, and subject to limited exceptions set forth therein, the Significant Stockholders may not (i) sell, transfer, ple dge, encumber, assign, distribute, gift or otherwise dispose of (including by operation of law, other than by death of any person) any of the Shares, (ii) grant any proxies or enter into any voting trust or other agreement or arrangement with respect to the voting of any Shares, or (iii) take any other action that would reasonably be expected to make any representation or warranty of the Significant Stockholder contained therein inaccurate in any respect.

To Kenexa’s and Merger Sub’s knowledge, after due inquiry, no Shares are beneficially owned by any of the persons named in Schedule I to this Schedule 13D, except for such beneficial ownership, if any, arising solely from the Tender Agreement.

Neither the filing of this Schedule 13D nor any of its contents shall be deemed to constitute an admission by Kenexa or Merger Sub that it is the beneficial owner of any of the Shares referred to herein for purposes of the Exchange Act, or for any other purpose, and such beneficial ownership is expressly disclaimed.

(c) Neither Kenexa nor Merger Sub nor, to the knowledge of Kenexa and Merger Sub, after due inquiry, any director or executive officer of Kenexa or Merger Sub named in Schedule I to this Schedule 13D, has effected any transaction in the Shares during the past 60 days, except as disclosed herein.

(d) Not applicable.

(e) Not applicable.

The descriptions contained in this Item 5 of the transactions contemplated by the Merger Agreement and the Tender Agreement do not purport to be complete and are qualified in their entirety by reference to the terms of the Merger Agreement and Tender Agreement, copies of which are referenced as Exhibit 2.1 and Exhibit 2.2 hereto, respectively, and are incorporated herein by reference.

Item 6.   Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer.

Except as described in Items 4 and 5 and in the agreements incorporated herein by reference and set forth as exhibits hereto, there are no contracts, arrangements, understandings or relationships (legal or otherwise) between any of the persons named in Item 2 and any person with respect to the securities of Salary.com.

Item 7. Material to be Filed as Exhibits

Exhibit No.	Description
2.1	Agreement and Plan of Merger, dated as of August 31, 2010, by and among Kenexa Corporation, Spirit Merger Sub, Inc. and Salary.com, Inc.
2.2	Tender and Support Agreement, dated as of August 31, 2010, by and among Kenexa Corporation, Spirit Merger Sub, Inc. and certain shareholders of Salary.com, Inc.
10.1	Credit Agreement, by and among Kenexa Technology, Inc., PNC Bank, National Association, as administrative agent, and the lenders party thereto, dated as of August 31, 2010
99.1	Joint Filing Agreement dated September 9, 2010, among Kenexa Corporation and Spirit Merger Sub, Inc., pursuant to Rule 13d-1(k)(1)

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SIGNATURE

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

KENEXA CORPORATION

/s/ Nooruddin S. Karsan

Name: Nooruddin S. Karsan

Title: Chief Executive Officer

Date: September 9, 2010

SPIRIT MERGER SUB, INC.

/s/ Donald F. Volk

Name: Donald F. Volk

Title: President

Date: September 9, 2010

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SCHEDULE I

INFORMATION RELATING TO KENEXA AND MERGER SUB

1.      Directors and Executive Officers of Kenexa

The following table sets forth the name, present principal occupation or employment, and material occupations, positions, offices or employment for at least the past five years of each director and executive officer of Kenexa Corporation. The current business address of each of these individuals is 650 East Swedesford Road Wayne, Pa, 19087 and the current business phone number of each of these individuals is (610) 971-9171. Each such individual is a citizen of the United States of America.

Name	Present Principal Occupation or Employment; Material Positions Held During the Past Five Years
Directors
Joseph A. Konen	Mr. Konen, 62, has been a member of Kenexa’s board of directors since 2000, who is now retired, has held a number of executive positions, most recently serving from 1994 to 1999 as the president and chief operating officer of Ameritrade Holding Corporation, a provider of brokerage services. Mr. Konen received a B.A. in economics and an M.B.A. in finance and management from Indiana University at Bloomington.
Richard J. Pinola	Mr. Pinola, 64, has been a member of Kenexa’s board of directors since 2005. From 1992 to 2004, Mr. Pinola served as the chairman and chief executive officer of Right Management Consultants, a human resources consulting firm. From 1989 to 1991, Mr. Pinola served as the chief operating officer of Penn Mutual Life Insurance Company. Mr. Pinola also serves as a director of Nobel Learning Communities, Inc., a for-profit provider of education and educational services; and Corporate Property Associates 14 Inc., Corporate Property Associates 15 Inc., and Corporate Property Associates 16 Inc., each a real estate investment trust. Mr. Pinola previously served as a director of K-Tron International, Inc., a manufacturer of material handling equipment and systems and Bankrate, Inc., an Internet financial services provider. Mr. Pinola received a B.S. in accounting from King’s College.
Troy A. Kanter	Mr. Kanter, 42, joined Kenexa in 1997 and has served as a member of Kenexa’s board of directors since May 2006 and as Kenexa’s President and Chief Operating Officer since November 2006. From 2003 until November 2006, Mr. Kanter served as Kenexa’s president, Human Capital Management. From 1997 to 2003, Mr. Kanter served as Kenexa’s executive vice president, sales and business development. From 1997 to 1999, he managed Kenexa’s HCM Consulting, Retention Services operations. From 1995 to 1997, Mr. Kanter was the president of Human Resources Innovations, Inc., a company he co-founded that provided employee survey research and consulting and which Kenexa acquired in 1997. From 1990 to 1994, Mr. Kanter was employed by The Gallup Organization, a provider of research, survey and HCM services, most recently serving as its vice president of client services. Mr. Kanter received a B.A. in corporate communications from Doane College.
Renee B. Booth	Dr. Booth, 51, has served as a member of Kenexa’s board of directors since May 2006. Since 1999, Dr. Booth has served as the president of Leadership Solutions, Inc., a boutique human resources consulting firm specializing in leadership assessments, selection, development and motivation. Dr. Booth received a B.A. in psychology from the University of Maryland and a M.S. and Ph.D. in industrial/organizational psychology from Pennsylvania State University.
Rebecca J. Maddox	Ms. Maddox, 56, has been a member of Kenexa’s board of directors since October 2006. Ms. Maddox is a founding principal, president and chief executive officer of Maddox Smye LLC, an international specialty sales consulting firm, and has served in that capacity since 1993. Prior to that, Ms. Maddox held positions that included chief executive officer of Capital Rose, Inc., senior vice president, marketing of Capital Holding, and senior vice president, marketing, Citicorp. Ms. Maddox received a B.S. degree in business administration from Pennsylvania State University and an M.B.A. in marketing and finance from Columbia University.
Barry M. Abelson	Mr. Abelson, 64, has been a member of Kenexa’s board of directors since 2000. Since 1992, Mr. Abelson has been a partner in the law firm of Pepper Hamilton LLP, which has provided legal services to Kenexa since 1997. Mr. Abelson received an A.B. in sociology from Dartmouth College and a J.D. from the University of Pennsylvania Law School.
Nooruddin (Rudy) S. Karsan	Mr. Karsan, 52, co-founded Kenexa’s predecessor company in 1987 and has served as the chairman of Kenexa’s board of directors since 1997 and as Kenexa’s chief executive officer since 1991. Prior to that, Mr. Karsan headed marketing actuarial for the Mercantile & General Insurance Company in Toronto, Canada. Mr. Karsan received a B Math in actuarial science from the University of Waterloo. Mr. Karsan holds the designation of Fellow of the Society of Actuaries.
John A. Nies	Mr. Nies, 41, has been a member of Kenexa’s board of directors since 2002. Mr. Nies is a managing director of JMH Capital, a private equity firm. From 2002 to 2005, Mr. Nies served as a principal of Sage River Partners, LLC and Maplegate Holdings, LLC, private equity firms investing on behalf of individual investors. From 2001 to 2002, Mr. Nies worked for Parthenon Capital, Inc., a private equity investment firm, most recently serving as its managing director, operations, a position in which he was responsible for post-transaction performance of portfolio companies. From 1991 to 2001, Mr. Nies worked for The Parthenon Group, a management consulting firm. Mr. Nies received an A.B. in economics from Dartmouth College and an M.B.A. from Harvard Business School.

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Executive Officers
Nooruddin (Rudy) S. Karsan	Mr. Karsan, 52, co-founded Kenexa’s predecessor company in 1987 and has served as the Chairman of Kenexa’s board of directors since 1997 and as Kenexa’s Chief Executive Officer since 1991. Prior to that, Mr. Karsan headed marketing actuarial for the Mercantile & General Insurance Company in Toronto, Canada. Mr. Karsan received a B Math in actuarial science from the University of Waterloo. Mr. Karsan holds the designation of Fellow of the Society of Actuaries.
Troy A. Kanter	Mr. Kanter, 42, joined Kenexa in 1997 and has served as a member of Kenexa’s board of directors since May 2006 and as Kenexa’s President and Chief Operating Officer since November 2006. During 2008, Mr. Kanter became increasingly more responsible for Kenexa’s companywide strategy and operations. From 2003 until November 2006, Mr. Kanter served as Kenexa’s President, Human Capital Management. From 1997 to 2003, Mr. Kanter served as Kenexa’s Executive Vice President, Sales and Business Development. From 1997 to 1999, he managed Kenexa’s HCM Consulting, Retention Services operations. From 1995 to 1997, Mr. Kanter was the president of Human Resources Innovations, Inc., a company he co-founded that provided employee survey research and consulting and which Kenexa acquired in 1997. From 1990 to 1994, Mr. Kant er was employed by The Gallup Organization, a provider of research, survey and HCM services, most recently serving as its vice president of client services. Mr. Kanter received a B.A. in corporate communications from Doane College.
Donald F. Volk	Mr. Volk, 60, has served as Kenexa’s Chief Financial Officer since December 1996. Prior to joining Kenexa, Mr. Volk was a partner in the accounting firm of Brinker, Simpson, Nicastro & Volk. Mr. Volk received a B.S. in Accounting from Villanova University and an M.S. in Taxation from the Villanova University School of Law. Mr. Volk became a Certified Public Accountant in 1974.
Sarah M. Teten	Ms. Teten, 36, joined Kenexa in 1999 and has served as Kenexa’s Chief Customer Officer since October 2009. In 2009, Ms. Teten transitioned into this role and is responsible for ensuring Kenexa’s brand and extreme service promise is communicated, delivered and fulfilled at each phase of the customer lifecycle. From 2004 to 2009 Ms. Teten served as Kenexa’s Chief Marketing Officer. From 2002 to 2004, Ms. Teten served as Kenexa’s Director of Marketing and was one of Kenexa’s sales executives from 1999 until 2002. Prior to joining Kenexa, Ms. Teten served as a marketing manager for Kaplan Educational Centers, a provider of educational services. Ms. Teten received a Bachelor of Journalism and Mass Communications degree from the University of Nebraska.
Archie L. Jones, Jr.	Mr. Jones, 38, has served as Kenexa’s Vice President of Business Development since August 2005. In 2008, his responsibilities were expanded to include Global Operations and Delivery and its financial impact. From 2003 until 2005, Mr. Jones served as managing director of Maplegate Holdings, a private equity investment firm that he co-founded that focuses on small-cap buyouts. From 1998 until 2002, Mr. Jones was a principal and charter member of Parthenon Capital, Inc., a private equity investment firm. Mr. Jones served on Kenexa’s board of directors from 1999 until 2002. He served on the board of directors of Franco Apparel Group from 1998 until 2004 and held the role of that organization’s interim CFO in 1999. Mr. Jones received an M.B.A. from Harvard Business School and a B.A. in Accounting and Business Administration f rom Morehouse College.
James P. Restivo	Mr. Restivo, 49, has served as Kenexa’s Chief Knowledge Officer since October 2006. Prior to joining Kenexa, Mr. Restivo was the founder, President and Chief Executive Officer of Blue Angel Technologies. Between 1993 and 1997, he also served as the Vice President of Development for Vertex Inc., the leading provider of corporate sales tax software. Mr. Restivo received a S.M. degree in electrical engineering and computer science from the Massachusetts Institute of Technology and a B.S. degree with a double major in computer science and applied mathematics and statistics the State University of New York at Stony Brook.

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2.      Directors and Executive Officers of Merger Sub

The following table sets forth the name, present principal occupation or employment, and material occupations, positions, offices or employment for at least the past five years of each director and executive officer of Spirit Merger Sub, Inc. The current business address of each of these individuals is 650 East Swedesford Road Wayne, Pa, 19087 and the current business phone number of each of these individuals is (610) 971-9171. Each such individual is a citizen of the United States of America.

Name	Present Principal Occupation or Employment; Material Positions
Directors
Donald F. Volk	Mr. Volk, 60, has been a member of board of directors of Spirit Merger Sub, Inc. since 2010.
Troy A. Kanter	Mr. Kanter, 42, has been a member of board of directors of Spirit Merger Sub, Inc. since 2010.
Nooruddin (Rudy) S. Karsan	Mr. Karsan, 52, has been a member of the board of directors of Spirit Merger Sub, Inc. since 2010.
Executive Officers
Donald F. Volk	Mr. Volk, 60, has served as President and Treasurer of Spirit Merger Sub, Inc. since 2010.
Archie L. Jones, Jr.	Mr. Jones, 38, has served as Vice President of Spirit Merger Sub, Inc. since 2010.
Cynthia Dixon	Ms. Dixon, 56, has served as Secretary of Spirit Merger Sub, Inc. since 2010.

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EX-2.1

Exhibit 2.1

AGREEMENT AND PLAN OF MERGER

by and among

KENEXA CORPORATION

SPIRIT MERGER SUB, INC.

and

SALARY.COM, INC.

Dated as of August 31, 2010

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TABLE OF CONTENTS

	Page
ARTICLE 1  THE OFFER	5
1.1  The Offer	5
1.2  Seller Actions	6
1.3  Directors	6
1.4  Top-Up Option	7
ARTICLE II  THE MERGER	8
2.1  The Merger	8
2.2  Closing; Effective Time	8
2.3  Effects of the Merger	8
2.4  Certificate of Incorporation and Bylaws	8
2.5  Directors and Officers	9
2.6  Stockholders' Meeting	9
2.7  Merger Without Meeting of Stockholders	9
ARTICLE III  EFFECT OF THE MERGER ON SELLER CAPITAL STOCK; EXCHANGE OF SHARES	10
3.1  Conversion of Capital Stock	10
3.2  Exchange of Certificates	11
3.3  Appraisal Rights	12
3.4  Treatment of Options, Restricted Stock and Restricted Stock Units	12
ARTICLE IV  REPRESENTATIONS AND WARRANTIES OF PARENT AND PURCHASE	13
4.1  Corporate Organization	13
4.2  Authority	13
4.3  Consents and Approvals	13
4.4  Broker's Fees	13
4.5  Legal Proceedings	13
4.6  Available Funds	14
4.7  Absence of Certain Changes or Events	14
4.8  Certain Compensation Arrangements	14
4.9  Offer Documents; Proxy Statements; Parent Information	14
4.10  No Other Representation or Warranties	14
ARTICLE V  REPRESENTATIONS AND WARRANTIES OF SELLER	15
5.1  Corporate Organzations	15
5.2  Capitalization	16
5.3  Authority	17
5.4  No Violation; Required Filings and Consents	17
5.5  SEC Filings; Controls and Procedures	18
5.6  Financial Statements	19
5.7  Absence of Undisclosed Liabilities	19
5.8  Absence of Certain Changes or Events	19
5.9  Broker's Fees	20
5.10  Legal Proceedings	20
5.11  Permits; Compliance with Applicable Laws	20
5.12  Taxes and Tax Returns	20
5.13  Employee Benefit Programs	21
5.14  Labor and Employment Matters	22
5.15  Material Contracts	22
5.16  Properties	23
5.17  Environmental Liability	23
5.18  State Takeover Laws; Required Stockholder Vote	23
5.19  Intellectual Property	24
5.20  Insurance	25
5.21  Opinion of Financial Advisor	25
5.22  Schedule 14D-9; Proxy Statement; Seller Information	25
5.23  Certain Compensation Arrangements	25
5.24  Customers; Distributers and Vendors	25

2

TABLE OF CONTENTS

	Page
ARTICLE VI  COVENANTS RELATING TO CONDUCT OF BUSINESS	26
6.1  Conduct of Business Pending the Effective Time	26
ARTICLE VII  ADDITIONAL AGREEMENTS	28
7.1  Third Party Consents and Regulatory Approvals	28
7.2  No Solicitation	29
7.3  Access to Information	30
7.4  Employment and Benefit Matters	30
7.5  Director's and Officer's Indemnification and Insurance	31
7.6  Additional Agreements	32
7.7  Advice of Changes	32
7.8  Publicity	32
7.9  Rule 16b-3 Actions	32
7.10  Rule 14d-10 Actions	33
7.11  State Takeover Laws	33
7.12  Notification of Certain Litigation	33
7.13  401(k)	33
ARTICLE VIII  CONDITIONS PRECEDENT TO THE CONSUMMATION OF THE MERGER	34
8.1  Conditions	34
ARTICLE IX  TERMINATION, AMENDMENT AND WAIVER	35
9.1  Termination	35
9.2  Effect of Termination	36
9.3  Amendment	37
9.4  Extension; Waiver	37
ARTICLE X  MISCELLANEOUS	38
10.1  Nonsurvival of Representations, Warranties and Agreements	38
10.2  Expenses	38
10.3  Notices	38
10.4  Interpretion	39
10.5  Counterparts	39
10.6  Entire Agreement	39
10.7  Governing Law; Jurisdiction and Venue; WAIVER OF JURY TRIAL	40
10.8  Severability	40
10.9  Assignment; Reliance of Other Parties	41
10.10  Purchaser Performance	41
10.11  Specific Performance	41
10.12  Definitions	42

3

AGREEMENT AND PLAN OF MERGER

THIS AGREEMENT AND PLAN OF MERGER (the “Agreement”), is dated as of August 31, 2010, by and among Kenexa Corporation, a Pennsylvania corporation (“Parent”), Spirit Merger Sub, Inc., a Delaware corporation and a wholly-owned subsidiary of Parent (“Purchaser”), and Salary.com, Inc., a Delaware corporation (“Seller”).  All capitalized terms used in this Agreement shall have the respective meanings ascribed thereto in Section 10.12.

WHEREAS, the boards of directors of each of Parent, Purchaser and Seller have approved the acquisition of Seller by Parent on the terms and conditions set forth in this Agreement;

WHEREAS, pursuant to this Agreement, and subject to the terms and conditions set forth herein, Purchaser has agreed to commence a tender offer (the “Offer”) to purchase all of the Seller’s common stock, par value $0.0001 per share (“Seller Common Stock”), including the associated preferred stock purchase rights (the “Seller Rights” ) issued under that Rights Agreement between Seller and American Stock Transfer & Trust Company, LLC (“AST”), dated as of November 14, 2008 (the “Rights Agreement”), at a price per share of $4.07, net to the Seller Stockholders in cash without interest, subject to any tax withholding (such amount or any greater amount per share paid pursuant to the Offer being hereafter referred to as the “Offer Price”);

WHEREAS, following consummation of the Offer, upon the terms and conditions set forth herein, Purchaser will be merged with and into Seller, with Seller as the surviving corporation (the “Merger” and, together with the Offer, the “Transaction”), whereby each issued and outstanding share of Seller Common Stock not owned directly or indirectly by Parent, Purchaser or Seller will be converted into the right to receive the Offer Price;

WHEREAS, the Seller Board has (i) (A) determined that this Agreement, the Offer and the Merger are advisable and in the best interests of Seller and the Seller Stockholders, (B) approved the Offer and the Merger in accordance with the General Corporation Law of the State of Delaware (the “DGCL”), and (C) adopted this Agreement, and (ii) recommended that the Seller Stockholders accept the Offer, tender their shares of Seller Common Stock into the Offer, and if required by applicable Law, adopt and approve this Agreement and approv e the Merger;

WHEREAS, as an inducement and condition to Parent entering into this Agreement, certain Seller Stockholders, including the Seller directors and executive officers, are entering into tender and stockholder support agreements (collectively, the “Support Agreements”) with Parent and Purchaser simultaneously with the execution of this Agreement, whereby, among other things, such stockholders have agreed, upon the terms and subject to the conditions set forth therein, to tender the shares of Seller Common Stock held by such stockholde rs (in their individual capacities) in the Offer and to support the actions necessary to consummate the Merger;

WHEREAS, concurrently with the execution and delivery of this Agreement, and as a condition and inducement to the willingness of Parent and Purchaser to enter into this Agreement, Seller and AST are entering into an amendment (the “Rights Plan Amendment”) to the Rights Agreement so as to render the Seller Rights inapplicable to this Agreement, the Support Agreements and the transactions contemplated hereby and thereby; and

WHEREAS, the parties desire to make certain representations, warranties and agreements in connection with the Transaction and to prescribe certain conditions to the Transaction.

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants, representations, warranties and agreements contained herein, and intending to be legally bound hereby, the parties agree as follows:

4

ARTICLE I

THE OFFER

1.1The Offer.

(a)Provided that this Agreement shall not have been terminated in accordance with Article IX hereof and none of the events set forth in clause (iii) of the Tender Offer Conditions shall have occurred, as promptly as reasonably practicable (but in no event later than ten (10) Business Days) after the date of this Agreement, Parent shall cause Purchaser to commence (within the meaning of Rule 14d-2 of the Exchange Act) the Offer at the Offer Price.  Subject to the terms and conditions of this Agreement and to the satisfaction or waiver of the Tender Offer Conditions set forth in Annex I (including the Minimum Condition), Purchaser shall, and Parent shall cause Purchaser to, promptly after the Expiration Date, accept for payment and pay for, after giving effect to any withholding tax, all such shares of Seller Common Stock validly tendered pursuant to the Offer and not withdrawn.

(b)Upon the terms and subject to the conditions set forth in this Agreement, each of the parties hereto agrees to use its reasonable best efforts to take, or cause to be taken, all actions that are necessary, proper or advisable to consummate and make effective the Offer, the Merger and the other transactions contemplated by this Agreement.

(c)The initial expiration date of the Offer shall be on the 20th Business Day after commencement of the Offer (determined in accordance with Rules 14d-1(g)(3) and 14d-2 under the Exchange Act) (the latest time and date as the Offer, as it may be extended pursuant to this Section 1.1(c), may expire shall be referred to as the “Expiration Date”).  If on or prior to any then-scheduled Expiration Date, all of the conditions to the Offer (including the Minimum Condition and all other conditions and requirements set forth in Annex I) shall not have been satisfied, or waived by Parent or Purchaser if permitted hereunder, Purchaser shall (and Parent shall cause Purchaser to) extend the Offer for periods of up to 10 Business Days each until the earlier of (x) the date on which the Minimum Condition has been met and all of the conditions and requirements set forth in Annex I are satisfied or waived or (y) the date on which this Agreement is terminated in accordance with Section 9.1; provided, however, that Purchaser shall not be required to extend the Offer beyond the Outside Dat e.  Purchaser expressly reserves the right, subject to compliance with the Exchange Act, to waive, amend or modify any term or condition of the Offer in its sole discretion; provided, however, that, without the prior written consent of Seller, Purchaser shall not:

                                                                (i)change the form of consideration payable in the Offer, decrease the Offer Price or decrease the number of shares of Seller Common Stock sought pursuant to the Offer;

                                                                (ii)otherwise extend the Expiration Date of the Offer except (A) as required by applicable law (including for any period required by any rule, regulation, interpretation or posi tion of the United States Securities and Exchange Commission (the “SEC”) or the staff thereof), or (B) in connection with an increase in the consideration to be paid pursuant to the Offer so as to comply with applicable rules and regulations of the SEC;

(iii)waive or amend the Minimum Condition;

(iv)impose any condition to the Offer not set forth in Annex I; or

(v)amend any term of the Offer in any manner materially adverse to holders of shares of Seller Common Stock.

(d)Purchaser may, without the consent of Seller, elect to provide a subsequent offering period for the Offer in accordance with Rule 14d-11 of the Exchange Act following its acceptance for payment of shares of Seller Common Stock in the Offer.

(e)On the date of commencement of the Offer, Parent and Purchaser shall (i) file or cause to be filed with the SEC a Tender Offer Statement on Schedule TO (together with all amendments and supplements thereto, the “Schedule TO”) with respect to the Offer which shall contain or incorporate by reference the offer to purchase and forms of the related letter of transmittal, summary advertisement and other ancillary documents and instruments required thereby pursuant to which the Offer will be made (collectively with any supplements , amendments and exhibits thereto, and all deliveries, mailings and telephonic notices required by Rule 14d-3 under the Exchange Act, the “Offer Documents”), and (ii) cause the Offer Documents to be disseminated to the Seller Stockholders as and to the extent required by the Exchange Act.  Seller and its counsel shall be given a reasonable opportunity to review and comment on the Offer Documents prior to their filing with the SEC, and Parent and Purchaser shall give reasonable and good faith consideration to any comments made by Seller or its counsel.  Parent and Purchaser agree to provide Seller with (i) any comments or other communications, whether written or oral, that may be received from the SEC or its staff with respect to the Offer Documents promptly after receipt thereof and prior to responding thereto, and (ii) a reasonable opportunity to provide comments on that response (to which reasonable and good faith consideration shall be given).  If at an y time prior to the Effective Time, any information relating to the Offer, the Merger, Seller, Parent, Purchaser or any of their respective Affiliates, should be discovered by Seller or Parent which should be set forth in an amendment or supplement to the Offer Documents, so that the Offer Documents shall not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not misleading, the party which discovers such information shall promptly notify the other party, and an appropriate amendment or supplement describing such information shall be filed with the SEC and disseminated to the Seller Stockholders, as and to the extent required by applicable Law or any applicable rules or regulations of any stock exchange.  Seller shall furnish to Parent and Purchaser all information concerning Seller required by the Exchange Act to be set forth i n the Offer Documents.

(f)Parent shall provide or cause to be provided to Purchaser on a timely basis the funds necessary to pay for any shares of Seller Common Stock that Purchaser becomes obligated to purchase pursuant to the Offer and shall cause Purchaser to fulfill its obligations under this Agreement.

5

1.2Seller Actions.

(a)Subject to Section 7.2 and to any consents or approval of Seller’s stockholders required under applicable Law, Seller hereby approves of and consents to the Offer, the Merger and the other transactions contemplated by this Agreement. Seller, after affording Parent, Purchaser and their counsel a reasonable opportunity to review and comment thereon and giving reasonable and good faith consideration to any comments made by Parent, Purchaser or their counsel, (a) shall file with the SEC and mail to the Seller Stockholders, as promptly as practicable on the date of the filing by Parent and Purchaser of the Offer Documents, a Solicitation/Recommendation Statement on Schedule 14D-9 (together with any amendments or supplements thereto, the “Schedule 14D-9”) reflecting, subject to Section 7.2, the recommendation of the Seller Board that the Seller Stockholders tender their shares of Seller Common Stock pursuant to the Offer and (b) shall disseminate the Schedule 14D-9 as required by Rule 14d-9 promulgated under the Exchange Act.  The Schedule 14D-9 will set forth, and Seller hereby represents, that the Seller Board, at a meeting duly called and held at which a quorum was present throughout, has (i) unanimously determined and declared that this Agreement, the Transaction, and each of the Offer and the Merger, is advisable and in the best interests of Seller and the Seller Stockholders, (ii) unanimously approved the Offer, the Merger and this Agreement in accordance with the DGCL, (iii) unanimously recommended acceptance of the Offer and adoption and approval of this Agreement and approval of the Merger by the Seller Stockholders if such adoption and approval is required by applicable Laws (together with the declarations in clause (i), the “Seller Recommendations”), and (iv) taken all other action necessary to render Section 203 of the DGCL inapplicable to each of the Offer and the Merger; provided, however, that the Seller Recommendations may be withdrawn, modified or amended only prior to the acceptance for payment of shares of Seller Common Stock pursuant to the Offer and in any case only to the extent permitted by Section 7.2.  Seller hereby conse nts to the inclusion in the Offer Documents of the Seller Recommendations.  Seller shall include in its entirety in the Schedule 14D-9, and has obtained all necessary consents to permit the inclusion in its entirety of, the fairness opinion of Seller’s Financial Advisor delivered to the Seller Board in connection with the Transaction. If at any time prior to the Effective Time, any information relating to the Offer, the Merger, Seller, Parent, Purchaser or any of their respective Affiliates, should be discovered by Seller or Parent which should be set forth in an amendment or supplement to the Schedule 14D-9 so that the Schedule 14D-9 shall not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not misleading, the party which discovers such information shall promptly notify the other party, and an appropriate amendment or supplement describing such information shall be filed with the SEC and disseminated to the Seller Stockholders, as and to the extent required by applicable Law or any applicable rules or regulations of any stock exchange.

(b)Seller agrees to provide Parent and Purchaser with (i) any comments or other communications, whether written or oral, that may be received from the SEC or its staff with respect to the Schedule 14D-9 promptly after receipt thereof and prior to responding thereto, (ii) the opportunity to participate in any substantive telephonic communications with the staff of the SEC related thereto, and (iii) a reasonable opportunity to review and provide comments on the Offer Documents or such response (to which reasonable and good faith consideration shall be given).

(c)In connection with the Offer, Seller will promptly furnish Purchaser with mailing labels, security position listings, non-objecting beneficial owner lists and any available listing or computer list containing the names and addresses of the record holders of the shares of Seller Common Stock as of the most recent practicable date, and shall furnish Purchaser with such additional available information (including updated lists of holders of shares of Seller Common Stock and their addresses, mailing labels and lists of security positions and non-objecting beneficial owner lists) and such other assistance as Purchaser or its agents may reasonably request in c ommunicating the Offer to, and soliciting tenders of shares of Seller Common Stock from, Seller’s record and beneficial stockholders.  Subject to the requirements of applicable Laws, and except for such steps as are necessary to disseminate the Offer Documents and any other documents necessary to consummate the Merger, Parent, Purchaser and their Representatives shall keep such information confidential and use the information contained in any such labels, listings and files only in connection with the Offer and the Merger and, should the Offer terminate or if this Agreement shall be terminated, will promptly destroy or deliver to Seller all copies of such information then in their possession.

                1.3Directors.

(a)Promptly after the first time at which Purchaser accepts for payment any shares of Seller Common Stock pursuant to the Offer (the “Acceptance Date”), and from time to time thereafter as shares of Seller Common Stock are accepted for payment and the Offer Price is paid by Purchaser, Purchaser shall be entitled to designate such number of members of the Seller Board (the “Purchaser Designees”), rounded up to the nearest whole number, as will give Purchaser represe ntation on the Seller Board equal to (x) the product of the total number of members of the Seller Board (after giving effect to the directors elected pursuant to this sentence) multiplied by (y) the percentage that (A) the number of shares of Seller Common Stock beneficially owned by Parent or Purchaser at such time (including shares of Seller Common Stock so accepted for payment) bears to (B) the total number of shares of Seller Common Stock then outstanding; provided that in no event shall the Purchaser Designees constitute less than a majority of the Seller Board.  In furtherance thereof, Seller shall, upon the request of Purchaser, use its best efforts promptly (and in any event within one Business Day) either to increase the size of the Seller Board (including by amending the Bylaws, if necessary) or to secure the resignations of such number of Seller’s incumbent directors (and such incumbent directors have agreed to resign if required in order for Seller to comply with this Section 1.3(a)), or both, as is necessary to enable the Purchaser Designees to be so elected or appointed to the Seller Board and Seller shall take all actions available to Seller to cause the Purchaser Designees to be so elected or appointed.  At such time, Seller shall, if requested by Purchaser, and subject to applicable Law and stock exchange listing standards, also take all action necessary to cause persons designated by Purchaser to constitute at least the same percentage (rounded up to the next whole number) as is on the Seller Board of (i) each committee of the Seller Board, (ii) each board of directors (or similar body) of each Subsidiary of Seller an d (iii) each committee (or similar body) of each such board.  The provisions of this Section 1.3 are in addition to and shall not limit any rights which Purchaser, Parent or any of their Affiliates may have as a holder or beneficial owner of shares of Seller Common Stock as a matter of applicable law with respect to the election of directors or otherwise.

(b)Seller shall take all actions required in order to fulfill its obligations under Section 1.3(a), including mailing to its stockholders the information required by Section 14(f) of the Exchange Act and Rule 14f-1 promulgated thereunder as part of the Schedule 14D-9.  Parent and Purchaser shall supply to Seller in writing any information with respect to Parent and Purchaser and the Purchaser Designees to the extent required by such Section 14(f) and Rule 14f- 1.

(c)Notwithstanding the provisions of this Section 1.3, at least two of the members of the Seller Board who were directors of Seller on the date hereof and who qualify as independent directors for purposes of the continued listing requirements of NASDAQ (the “Independent Directors”), shall, at all times prior to the Effective Time, be directors of Seller; provided that if there shall be in office less than two Independent Directors for any reason, the Seller Board shall cause the Person designated by the remaining Independent Director to fill such vacancy who shall be deemed to be an Independent Director for all purposes of this Agreement, or if no Independent Directors then remain, the other directors of Seller then in office shall designate two persons to fill such vacancies who will not be directors, officers, employees or Affiliates of Parent or Purchaser and such persons shall be deemed to be Independent Directors for all purposes of this Agreement.  From and after the time, if any, that the Purchaser Designees constitute a majority of the Seller Board and prior to the Effective Time, subject to the terms hereof, any amendment or modification of this Agreement, any termination of this Agreement by Seller, any extension of time for performance of any of the obligations of Parent or Purchaser hereunder, any waiver of any condition to Seller’s obligations hereunder or any of Seller’s right s hereunder or any amendment to Seller’s certificate of incorporation or bylaws may be effected only if (in addition to the approval of the Seller Board as a whole) there are in office one or more Independent Directors and such action is approved by a majority of the Independent Directors then in office.

6

1.4Top-Up Option.

(a)Subject to Section 1.4(b) and Section 1.4(c), Seller hereby grants to Purchaser an irrevocable option (the “Top-Up Option”) to purchase from Seller, at a price per share equal to the Offer Price,  the number of shares of Seller Common Stock (the “Top-Up Option Shares”) equal to the number of shares of Seller Common Stock that, when added to the number of shares of S eller Common Stock owned by Purchaser as of immediately prior to the exercise of the Top-Up Option, constitutes one share more than 90% of the number of shares of Seller Common Stock then outstanding on a fully diluted basis (determined in accordance with Annex I) (assuming the issuance of the Top-Up Option Shares); provided, however, that the Top-Up Option may not be exercised unless the aggregate number of Top-Up Option Shares does not exceed the aggregate number of authorized shares of Seller Common Stock at the time of exercise of the Top-Up Option which are not then outstanding (giving effect to the shares of Seller Common Stock issued pursuant to all then-outstanding stock options, restricted stock units and any other rights to acquire Seller Common Stock as if such shares were outstanding).  The Top- Up Option shall be exercisable once at any time following the Acceptance Date and prior to the earlier to occur of (a) the Effective Time and (b) the termination of this Agreement in accordance with its terms.

(b)The aggregate purchase price payable for the Top-Up Option Shares may be paid by Purchaser, at its election, either in cash or by executing and delivering to Seller a promissory note having a principal amount equal to such payment, or by any combination of cash and such promissory note.  Any such promissory note shall bear interest at the applicable federal rate determined under Section 1274(d) of the Code, shall mature on the first anniversary of the date of execution and delivery of such promissory note and may be prepaid without premium or penalty.

(c)In the event that Purchaser wishes to exercise the Top-Up Option, it shall deliver to Seller a notice setting forth (i) the number of shares of Seller Common Stock owned by Parent and Purchaser at the time of such notice, (ii) the manner in which it intends to pay the corresponding Top-Up Option Purchase Price and (iii) the place and time at which the closing of the purchase of the Top-Up Option Shares by Purchaser is to take place.  Seller shall, as soon as practicable following receipt of such notice, deliver written notice to Purchaser specifying, based on the information provided by Purchaser in its notice, the number of Top- Up Option Shares. At the closing of the purchase of the Top-Up Option Shares, Purchaser shall cause to be delivered to Seller the consideration required to be delivered in exchange for such Top-Up Option Shares, and Seller shall cause to be issued to Purchaser a certificate representing such shares or, if Seller does not then have certificated shares of Seller Common Stock, the applicable number of book-entry shares of Seller Common Stock.

(d)Parent and Purchaser acknowledge that the Top-Up Option Shares that Purchaser may acquire upon exercise of the Top-Up Option will not be registered under the Securities Act and will be issued in reliance upon an exemption thereunder for transactions not involving a public offering.  Parent and Purchaser represent and warrant to Seller that Purchaser is, or will be upon the purchase of the Top-Up Option Shares, an “Accredited Investor”, as defined in Rule 501 of Regulation D under the Securities Act.  Purchaser agrees that the Top-Up Option and the Top-Up Option Shares to be acquired upon exercise of the Top-Up Op tion are being and will be acquired by Purchaser for the purpose of investment and not with a view to, or for resale in connection with, any distribution thereof in violation of the Securities Act.

7

ARTICLE II

THE MERGER

2.1The Merger.

Upon the terms and subject to the satisfaction or waiver of the conditions set forth in this Agreement, and in accordance with the DGCL, at the Effective Time, Purchaser shall merge with and into Seller.  Seller shall continue as the surviving corporation (the “Surviving Corporation”), and the separate corporate existence of Seller, with all its rights, privileges, immunities, powers and franchises shall continue unaffected by the Merger.  Upon consummation of the Merger, the separate corporate existence of Purchaser shall terminate.

2.2Closing; Effective Time.

 Subject to the terms and conditions of this Agreement, the closing of the Merger (the “Closing”) will take place at the offices of Goodwin Procter LLP, Exchange Place, Boston, Massachusetts, unless another place is agreed to in writing by the parties hereto, at 10:00 a.m. Eastern Time , on a date (the “Closing Date”) specified by the parties, which shall be no later than two (2) Business Days after the satisfaction or waiver (subject to applicable Law) of the latest to occur of the conditions set forth in Article VIII (other than those conditions that relate to action to be taken at the Closing), unless this Agreement has been theretofore terminated pursuant to its terms or unless extended by mutual agreement of the parties.  As soon as practicable after the satisfaction or waiver of the conditions set forth in Article VIII, the Merger shall become effective upon the filing with the Secretary of State of the State of Delaware of a certificate of merger or other appropriate document (the “Certificate of Merger”), and the parties shall make all other filings or recordings required by the DGCL.  The term “Effective Time” shall be the date and time when the Merger becomes effective.

2.3Effects of the Merger.

 At and after the Effective Time, the Merger shall have the effects set forth in this Agreement and in the appropriate provisions of the DGCL.  Without limiting the generality of the foregoing, and subject thereto, at the Effective Time, the Surviving Corporation shall possess all the rights, privileges, powers and franchises, and be subject to all of the restrictions, disabilities and duties of Seller and Purchaser, as provided under Section 259 of the DGCL.

2.4Certificate of Incorporation and Bylaws.

At the Effective Time, the Certificate of Incorporation, as amended, of Seller, as in effect immediately prior to the Effective Time, shall be amended to be identical to the Certificate of Incorporation of Purchaser, in the form attached hereto as Exhibit A (which shall contain such provisions as are necessary to give full effect to the exculpation and indemnification provided for in Section 7.5 hereof), except that the name of Seller as the Surviving Corporation shall continue to be “Salary.com, Inc.” and the provisions of the Certificate of Incorporation of Purchaser relating to the incorporator of Purchaser shall be omitted, and as so amended shall be the Certificat e of Incorporation of the Surviving Corporation until thereafter amended as provided therein and in accordance with applicable Law (the “Surviving Corporation Charter”).  From and after the Effective Time, the Bylaws, as amended, of Seller, as in effect immediately prior to the Effective Time, shall be amended and restated to be identical to the Bylaws of Purchaser as in effect immediately prior to the Effective Time (which shall contain such provisions as are necessary to give full effect to the exculpation and indemnification provided for in Section 7.5 hereof), and as so amended shall be the Bylaws of the Surviving Corporation, until thereafter amended as provided therein and in accordance with applicable Law (the “Surviving Corporation Bylaws”).

8

2.5 Directors and Officers.

(a)From and after the Effective Time, the directors of Purchaser immediately prior to the Effective Time shall become the directors of the Surviving Corporation, until their successors shall have been duly elected, appointed or qualified or until their earlier death, resignation or removal in accordance with the Surviving Corporation Charter and the Surviving Corporation Bylaws.

(b)From and after the Effective Time, the officers of Seller at the Effective Time shall be the officers of the Surviving Corporation, until their successors shall have been duly elected, appointed or qualified or until their earlier death, resignation or removal in accordance with the Surviving Corporation Charter and the Surviving Corporation Bylaws.

 2.6 Stockholders’ Meeting

.                (a)If the adoption and approval of this Agreement and approval of the Merger by the Seller Stockholders is required by applicable Law in order to consummate the Merger, Seller, acting through the Seller Board, shall, in accordance with applicable Law:

                                                                (i)duly set a record date for, call, give notice of, convene and hold a special meeting of its stockholders (the “Special Meeting”) as soon as practicable following the acceptance for payment of and payment for shares of Seller Common Stock by Purchaser pursuant to the Offer and the expiration of any subsequent offering period pursua nt to Section 1.1(c) for the sole purpose of obtaining the approval of the Seller Stockholders of the adopion and approval of this Agreement and the approval of the Merger in accordance with the DGCL;

                                                                 (ii)prepare and file with the SEC a preliminary proxy statement relating to this Agreement, and use its reasonable efforts (x) to obtain and furnish the information required t o be included by the SEC in the proxy statement and, after consultation with Parent, to respond promptly to any comments made by the SEC with respect to the preliminary proxy statement and cause a definitive proxy statement (the “Proxy Statement”) to be mailed to its stockholders, and (y) to obtain the necessary adoption and approval of this Agreement and approval of the Merger by its stockholders; and

                                                                 (iii)subject to the fiduciary duties of the Seller Board, include in the Proxy Statement the Seller Recommendations that the Seller Stockholders vote in favor of the adoption and approval of this Agreement and approval of the Merger.

(b)Each of Parent and Purchaser agrees that it will vote, or cause to be voted, all of the shares of Seller Common Stock then owned by it or any of its Subsidiaries in favor of, the approval of the Merger and the adoption and approval of this Agreement.

                 2.7   Merger Without Meeting of Stockholders

Notwithstanding Section 2.6, in the event that Purchaser shall acquire at least 90% of the outstanding shares of Seller Common Stock pursuant to the Offer or otherwise (the “Short Form Threshold”), subject to the terms and conditions hereof, the parties hereto agree to take all necessary and appropriate action to cause the Merger to become effective as soon as practicable after Purchaser obtains the Short Form Threshold without a meeting of stockholders of Seller, in accordance with Sec tion 253 of the DGCL.

9

ARTICLE III

EFFECT OF THE MERGER ON SELLER

CAPITAL STOCK; EXCHANGE OF SHARES

3.1Conversion of Capital Stock.

 As of the Effective Time, by virtue of the Merger and without any action on the part of any party hereto or of the holder of any shares of the capital stock of Seller or capital stock of Purchaser:

(a)Capital Stock of Purchaser.  Each share of the common stock, $0.01 par value per share, of Purchaser (the “Purchaser Common Stock”), issued and outstanding immediately prior to the Effective Time shall be converted into one validly issued, fully paid and nonassessable share of common stock, $0.01 par value per share, of the Surviving Corporation.

(b)Cancellation of Certain Stock.  All shares of Seller Common Stock that are owned by Seller as treasury stock or by any wholly-owned Subsidiary of Seller, and any shares of Seller Common Stock owned by Parent or Purchaser or by any wholly-owned Subsidiary of Parent or Purchaser immediately prior to the Effective Time, shall be cancelled and shall cease to exist and no consideration shall be delivered in exchange therefor.

(c)Conversion of Seller Common Stock.  Each share of Seller Common Stock issued and outstanding immediately prior to the Effective Time (other than (x) shares to be cancelled in accordance with Section 3.1(b)and (y) Dissenting Shares as defined in Section 3.3) shall be automatically converted into the right to receive an amount in cash, without interest, equal to the Offer Price (the “Merger Consideration”).  As of the Effective Time, all such shares of Seller Common Stock, when converted as provided in this Section 3.1(c), shall no longer be outstanding and shall automatically be cancelled and shall cease to exist, and each holder of a certificate (each, a “Certificate” and collectively, the “Certificates”) or book-entry share (each, a “Book-Entry Share” and collectively, the “Book- Entry Shares”) representing any such shares of Seller Common Stock shall cease to have any rights with respect thereto, except the right to receive the Merger Consideration upon surrender of such Certificate or Book-Entry Share in accordance with Section 3.2. In the event that, prior to the Effective Time, the outstanding shares of Seller Common Stock are changed into, or exchanged for, a different number or class of shares by reason of any stock split, stock combination, stock reclassification, reverse stock split, stock dividend, recapitalization or other similar transaction, the Offer Price and Merger Consideration (as applicable) payable per share of Seller Common Stock shall be adjusted to appropriately and proportionately reflect the effects of such transaction, it being understood that nothing herein shall be construed to permit the Sel ler to take any action with respect to the shares of Seller Common Stock or other securities of Seller that is prohibited by this Agreement.

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3.2Exchange of Certificates.

The procedures for exchanging outstanding shares of Seller Common Stock for the Merger Consideration are as follows:

(a)Paying Agent.  Prior to the Effective Time, Parent shall (i) designate, or cause to be designated, a bank or trust company that is reasonably acceptable to Seller (the “Paying Agent”) and (ii) enter into a paying agent agreement, in form and substance reasonably acceptable to Seller, with such Paying Agent to act as agent for the payment of the Merger Consideration.  On or before the Effective Time, Parent shall deposit, or cause to be deposited, with the Paying Agent funds in an amount sufficie nt to make the payments contemplated by Section 3.1 in accordance with the procedures set forth in Section 3.2(b) (such funds, the “Exchange Fund”).  In the event the Exchange Fund shall be insufficient to make all such payments, Parent shall promptly deposit, or cause to be deposited, additional funds with the Paying Agent in an amount that is equal to the deficiency in the amount of funds required to make such payments.  The Paying Agent shall make payments of the aggregate Merger Consideration out of the Exchange Fund in accordance with this Agreement.  The Exchange Fund shall not be used for any other purpose.

(b)Exchange Procedures.  As soon as reasonably practicable after the Effective Time, Parent or the Surviving Corporation shall cause the Paying Agent to mail to each holder of record of a Certificate or Book-Entry Shares which immediately prior to the Effective Time represented outstanding shares of Seller Common Stock whose shares were converted pursuant to Section 3.1(c) into the right to receive the Merger Consideration, (i) a l etter of transmittal (which shall specify that delivery shall be effected, and risk of loss and title to the Certificates or Book-Entry Shares, as applicable, shall pass, only upon delivery of the Certificates (or affidavits of loss in lieu thereof pursuant to Section 3.2(h) hereof) or Book-Entry Shares to the Paying Agent and shall be in such form and have such other provisions as Parent and Seller may mutually agree or the Paying Agent may reasonably specify), and (ii) instructions for effecting the surrender of the Certificates or Book-Entry Shares in exchange for the Merger Consideration.  Upon surrender of a Certificate or Book-Entry Share, as applicable, for cancellation to the Paying Agent, together with such letter of transmittal duly completed and validly executed in accordance with the instructions thereto, and such other documents as may reasonably be required pursuant to such instructions, the holder of such Certificate or such Book-Entry Share shall be entitled to receive in exchange therefor cash equal to the Merger Consideration payable in respect of the shares of Seller Common Stock previously represented by such Certificate or such Book-Entry Share, and the Certificate or Book-Entry Share so surrendered shall immediately be cancelled.  In the event of a transfer of ownership of Seller Common Stock which is not registered in the transfer records of Seller, payment may be made to a Person other than the Person in whose name the Certificate or Book-Entry Share so surrendered is registered, if such Certificate or such Book-Entry Share is presented to the Paying Agent, accompanied by all documents reasonably required to evidence and effect such transfer and by evidence that any applicable stock transfer taxes have been paid.  Until surrendered as contemplated by this Section 3.2, each Certificate or Book-Entry Share, as applicable, shall be deemed at any time after the Effective Time to represent only the right to receive, upon such surrender the Merger Consideration.  No interest shall be paid or accrue on any cash payable upon surrender of any Certificate or Book-Entry Share.

(c)No Further Ownership Rights in Seller Common Stock.  The Merger Consideration delivered upon the surrender for exchange of Certificates (or affidavit of loss in lieu thereof) or Book-Entry Shares, as applicable, in accordance with the terms hereof shall be deemed to have been delivered (and paid) in full satisfaction of all rights pertaining to such shares of Seller Common Stock, and from and after the Effective Time the stock transfer books of Seller shall be closed and thereafter, there shall be no further registration of transfers on the stock transfer books of the Surviving Co rporation of the shares of Seller Common Stock which were outstanding immediately prior to the Effective Time.  If, after the Effective Time, Certificates or Book-Entry Shares are presented to the Surviving Corporation or the Paying Agent for any reason, they shall be cancelled and exchanged as provided in this Article III.

(d)Termination of Exchange Fund.  Any portion of the Exchange Fund that remains undistributed to the holders of Certificates or Book-Entry Shares six (6) months after the Effective Time shall be delivered to Parent, upon demand, and any holder of a Certificate or a Book-Entry Share who has not previously complied with this Section 3.2 prior to the end of such six (6) month period shall thereafter look only to Parent for paymen t of its claim for the Merger Consideration.

(e)No Liability.  To the extent permitted by applicable Law, none of Parent, Purchaser, Seller, the Surviving Corporation or the Paying Agent or any of their respective Affiliates shall be liable to any Person in respect of Merger Consideration delivered to a public official pursuant to the requirements of any applicable abandoned property, escheat or similar Law.

(f)Investment of Exchange Fund.  The Paying Agent shall invest any cash included in the Exchange Fund as directed by Parent; provided, however, that such investments shall be in obligations of or guaranteed by the United States of America.  Any net profit resulting from, or interest or income produced by, such investments, shall be placed in the Exchange Fund and be payable to Parent.

(g)Withholding Rights.  Each of Parent, Purchaser, the Surviving Corporation and the Paying Agent shall be entitled to deduct and withhold from the Merger Consideration, Offer Price or consideration otherwise payable pursuant to this Agreement to any holder of a Certificate, a Book-Entry Share, a Seller Restricted Stock Unit, a Seller Restricted Stock Award or a Seller Stock Option, as the case may be, such amounts as it reasonably determines that it is required to deduct and withhold with respect to the making of such payment under the Code, or any other applicable provision of Law.   To the extent that amounts are so withheld by Parent, Purchaser, the Surviving Corporation or the Paying Agent, as the case may be, such deducted and withheld amounts shall be treated for all purposes of this Agreement as having been paid to the holder of the Certificate, Book-Entry Share, Seller Restricted Stock Unit or Seller Stock Option, as applicable, in respect of which such deduction and withholding was made by Parent, Purchaser, the Surviving Corporation or the Paying Agent, as the case may be.

(h)Lost Certificates.  If any Certificate shall have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the Person claiming such Certificate to be lost, stolen or destroyed and, if required by the Surviving Corporation, the posting by such Person of a bond in such reasonable amount as the Surviving Corporation may direct as indemnity against any claim that may be made against it with respect to such Certificate, the Paying Agent shall issue in exchange for such lost, stolen or destroyed Certificate, the Merger Consideration deliverable in respect thereof pursuant to this Agreement.

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3.3Appraisal Rights.

(a)Notwithstanding anything in this Agreement to the contrary, any shares (the “Dissenting Shares”) of Seller Common Stock that are issued and outstanding immediately prior to the Effective Time and that are held by the Seller Stockholders who, in accordance with Section 262 of the DGCL (the “Appraisal Rights Provisions”), (i) have not voted in favor of adopting this Agreement, (ii) shall have demanded properly in writing appraisal for such shares, (iii) have otherwise complied in all respects with th e Appraisal Rights Provisions, and (iv) have not effectively withdrawn, lost or failed to perfect their rights to appraisal (the “Dissenting Stockholders”), will not be converted into the Merger Consideration, but at the Effective Time, by virtue of the Merger and without any action on the part of the holder thereof, shall be cancelled and shall cease to exist and shall represent the right to receive only those rights provided under the Appraisal Rights Provisions; provided, however, that all shares of Seller Common Stock held by the Seller Stockholders who shall have failed to perfect or who effectively shall have withdrawn or lost their rights to appraisal of such shares of Seller Common Stock under the Appraisal Rights Provisions shall thereupon be deemed to have been cancelled and to have been convert ed, as of the Effective Time, into the right to receive the Merger Consideration relating thereto, without interest, in the manner provided in Sections 3.1 and Section 3.2.

(b)Seller shall give Parent and Purchaser prompt notice of any demands received by Seller for the exercise of appraisal rights with respect to shares of Seller Common Stock, and Parent shall have the right to participate in all negotiations and proceedings with respect to such demands subject, prior to the Effective Time, to consultation with Seller.  Seller shall not, except with the prior written consent of Parent, which consent shall not be unreasonably withheld, make any payment with respect to, or settle or offer to settle, any such demands.

(c)Each Dissenting Stockholder who becomes entitled under the Appraisal Rights Provisions to payment for Dissenting Shares shall receive payment therefor after the Effective Time from the Surviving Corporation (but only after the amount thereof shall have been agreed upon or finally determined pursuant to the Appraisal Rights Provisions), and such shares of Seller Common Stock shall be canceled. For the avoidance of doubt, Parent, Purchaser and Seller acknowledge and agree that, in any appraisal proceedings described herein and to the extent permitted by applicable Law, the fair value of the Dissenting Shares shall be determined in accordance with the DGCL without regard to the Top-Up Option, any Top-Up Option Shares or any promissory note delivered by Purchaser in payment thereof.

                 3.4Treatment of Options, Restricted Stock and Restricted Stock Units.

(a)Each Seller Stock Option that is outstanding immediately prior to the Effective Time, and that is not then vested and exercisable, shall become fully vested and exercisable immediately prior to the Effective Time.  As of the Effective Time, each Seller Stock Option that is outstanding immediately prior to the Effective Time shall be canceled in exchange for the right to receive from Parent or the Surviving Corporation immediately after the Effective Time, a lump sum cash payment (without interest), less any applicable withholding Taxes, equal to the product of (i) the excess, if any, of (A) the Merger Consideration over (B) the per share exerci se price for such Seller Stock Option and (ii) the total number of shares underlying such Seller Stock Option (giving effect to the acceleration of vesting contemplated by this Section 3.4(a)).  Seller shall ensure that following the Effective Time and subject to Section 3.4(b), no holder of a Seller Stock Option (or former holder of a Seller Stock Option) shall have any right thereunder to acquire any capital stock of Seller or the Surviving Corporation or any other equity interest therein (including “phantom” stock or stock appreciation rights). Each Out-of-the-Money Seller Stock Option that is outstanding immediately prior to the Effective Time shall be cancelled witho ut consideration.  Each Seller 2004 Stock Option that is outstanding immediately prior to the Acceptance Date shall be cancelled pursuant to the terms of the Seller 2004 Stock Plan without payment if not exercised prior to the Acceptance Date.  From and after the date hereof and until immediately prior to the Acceptance Date, all such Seller 2004 Stock Options shall be exercisable in full, whether or not vested and exercisable as of the date of this Agreement or on the date of exercise. As soon as practicable following the date of this Agreement, Seller shall provide notice of the operation of this Section 3.4(a) to each holder of a Seller 2004 Stock Option that is outstanding as of the date of this Agreement.

(b)Each Seller Restricted Stock Award that is outstanding immediately prior to the Effective Time shall become fully vested and cancelled immediately prior to the Effective Time in exchange for the right to receive from Parent or the Surviving Corporation immediately after the Effective Time, a lump sum cash payment (without interest), less any applicable withholding Taxes, equal to the product of (i) the Merger Consideration and (ii) the total number of shares underlying such Seller Restricted Stock Award (giving effect to the acceleration of vesting contemplated by this Section 3.4(b)).

(c)Each Seller Restricted Stock Unit that is outstanding immediately prior to the Effective Time shall become fully vested and cancelled immediately prior to the Effective Time in exchange for the right to receive from Parent or the Surviving Corporation immediately after the Effective Time, a lump sum cash payment (without interest), less any applicable withholding Taxes, equal to the product of (i) the Merger Consideration and (ii) the total number of shares underlying such Seller Restricted Stock Unit (giving effect to the acceleration of vesting contemplated by this Section 3.4(c).

(d)Seller shall take such action as may be necessary to establish a new Exercise Date (as defined under Seller's 2007 Employee Stock Purchase Plan (the “ESPP”)) on the last day of the payroll period ending immediately prior to the Effective Time (but in all events at least ten (10) Business Days prior to the Effective Time) with respect to the Offering (as defined in the ESPP) otherwise then in effect (the “Final Exercise Date”); (i) provide that no further Offerings shall commence under the ESPP on or fol lowing the Final Exercise Date; and (ii) terminate the ESPP as of the Final Exercise Date. Each outstanding option under the ESPP on the Final Exercise Date shall be exercised on such date for the purchase of Seller Common Stock in accordance with the terms of the ESPP.  Seller shall provide timely notice of the setting of the Final Exercise Date and termination of the ESPP in accordance with the terms of the ESPP.

(e)The Seller Board (or, if appropriate, any committee thereof administering the Seller Stock Plan) shall unanimously adopt such resolutions or take such other actions as may be required to effect the foregoing provisions of this Section 3.4 and Seller has all requisite corporate power and authority to take such other actions as may be required to effect the foregoing provisions of this Section 3.4.

(f)All payments made by Parent or Surviving Corporation pursuant to this Section 3.4 for Seller Stock Option, Seller Restricted Stock Award and Restricted Stock Unit shall be distributed through payroll of the Surviving Corporation.

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ARTICLE IV

REPRESENTATIONS AND WARRANTIES

OF PARENT AND PURCHASER

Except as set forth in the disclosure schedules delivered concurrently with the execution of this Agreement to Seller (the “Parent Disclosure Schedule”), which schedules shall identify any exceptions to the representations, warranties and covenants contained in this Agreement (with reference to the particular Section to which such information relates; provided that an item disclosed in any Section shall be deemed to have been disclosed for each other Section of this Agreement to the extent the relevance of such disclosure to such other Section of this Agreement is reasonably apparent on the face of such disclosure), Parent and Purchaser hereby jointly and severally represent and warrant to Seller as follows:

4.1Corporate Organization.

(a)Parent is a Pennsylvania corporation duly organized, validly existing and in corporate good standing under the laws of Pennsylvania.  Purchaser is a Delaware corporation duly organized, validly existing and in corporate good standing under the laws of Delaware.

(b)Parent has all requisite corporate power and authority and all necessary governmental approvals to own, lease and operate all of its properties and assets and to carry on its business as it is now being conducted.  Parent is duly licensed or qualified to do business and is in corporate good standing in each jurisdiction in which the nature of the business conducted by it or the character or location of the properties and assets owned, leased or operated by it makes such licensing or qualification necessary, except where the failure to be so licensed or qualified and in corporate good standing would not, either individually or in the aggregate, reasonably be expected to have a Parent Material Adverse Effect.  The certificate of incorporation and bylaws of Parent and the certificate of incorporation and bylaws of Purchaser, copies of which have previously been made available to Seller, are true, correct and complete copies of such documents as currently in effect.

(c)Purchaser was formed solely for the purpose of engaging in the transactions contemplated by this Agreement.  All of the issued and outstanding capital stock of Purchaser, which, as of the date hereof, consists of 1,000 shares of Purchaser Common Stock, is validly issued, fully paid and nonassessable and is owned, beneficially and of record, by Parent, free and clear of any Encumbrances other than a pledge of the Purchaser Common Stock under the Parent and Purchaser’s working capital line of credit with PNC Bank, N.A.  Except for obligations and liabilities incurred in connection with its incorporation and the transactions contem plated by this Agreement, Purchaser has not and will not have incurred, directly or indirectly, any obligations or liabilities or engaged in any business activities of any type or kind whatsoever or entered into any agreements or arrangements with any Person that would, either individually or in the aggregate, reasonably be expected to have a Parent Material Adverse Effect.

4.2Authority.

Each of Parent and Purchaser has all requisite corporate power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby and perform its obligations hereunder.  The adoption, execution, delivery and performance of this Agreement and the approval of the consummation of the transactions contemplated hereby have been recommended by, and are duly and validly authorized by all necessary action of, each of Parent and Purchaser.  Except for the filing of the Certificate of Merger, no other corporate proceedings on the part of Parent or Purchaser are necessary to authorize the adoption, execution, delivery and performance of this Agreement or to consummate each of the Offer, the Merger and the other tr ansactions contemplated hereby.  This Agreement has been duly and validly executed and delivered by Parent and Purchaser, and (assuming due authorization, execution and delivery by Seller), constitutes the valid and binding obligations of Parent and Purchaser, enforceable against Parent and Purchaser in accordance with its terms.

                4.3Consents and Approvals.

                Except (a) for filings, permits, authorizations, consents, and approvals and for the termination or expiration, as applicable, of any applicable waiting periods, as may be required under, and other applicable requirements of, the Exchange Act, the Securities Act, the HSR Act and other Regulatory Laws, and state securities or state “Blue Sky” laws, and (b) for filing of the Certificate of Merger, none of the execution, delivery or performance of this Agreement by Parent and Purchaser, the consummation by Parent and Purchaser of the transactions contemplated hereby, including the Offer and the Merger, or compliance by Parent and Purchaser with any of the provis ions hereof will (i) conflict with or result in any breach of any provision of the organizational documents of Parent or Purchaser, (ii) require either Parent or Purchaser to make any filing with, give any notice to, or obtain any permit, authorization, consent, or approval of, any Governmental Authority, (iii) result in a violation or breach of, or constitute (with or without due notice or lapse of time or both) a default (or give rise to any right of termination, cancellation or acceleration) under, any of the terms, conditions or provisions of any note, bond, mortgage, indenture, lease, license, contract, agreement or other instrument or obligation to which Parent and Purchaser, as the case may be, is a party or by which it or any of their respective properties or assets may be bound, or (iv) violate any order, writ, injunction, decree, statute, rule or regulation applicable to Parent and Purchaser or any of their respective properties or assets, excluding from the foregoing clauses (ii), (iii) and (iv) s uch filings, notices, permits, authorizations, consents, approvals, violations, breaches or defaults that, individually or in the aggregate, would not reasonably be expected to have a Parent Material Adverse Effect.

4.4Broker’s Fees

                Parent, and not Seller, shall be liable for any fee or other commission payable to any broker, finder, agent or similar intermediary engaged by Parent or Purchaser in connection with the transactions contemplated by this Agreement.

                 4.5  Legal Proceedings.

 There is no claim, suit, action, proceeding or investigation of any nature pending or, to the knowledge of Parent, threatened, against Parent, Purchaser or any Subsidiary of Parent challenging the validity or propriety of the transactions contemplated by this Agreement, which, if adversely determined, would, either individually or in the aggregate, reasonably be expected to have a Parent Material Adverse Effect.

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4.6Available Funds.

Parent has, and, at each of the Acceptance Date and the date of the Effective Time, Parent and Purchaser will have, all funds necessary for the payment of the aggregate Offer Price and the aggregate Merger Consideration, and sufficient for the satisfaction of all of Parent’s and Purchaser’s obligations under this Agreement, and, in connection therewith, no portion of the aggregate Offer Price will be financed with the proceeds from indebtedness for borrowed funds, other than a revolving line of credit with PNC Bank, National Association, as administrative agent, and the lenders party thereto (including PNC Bank, National Association) to Parent or Purchaser, all of which are available as of the date hereof and will be available at the Acceptance Time and the Effective Time.

4.7Absence of Certain Changes or Events

 Between December 31, 2009, which is the date of the most recent consolidated, audited balance sheet of Parent (a true, correct and complete copy of which was previously delivered to Seller), and the date of this Agreement, there has not been any Change that has had, or would reasonably be expected to result in, a Parent Material Adverse Effect.

4.8Certain Compensation Arrangements

                 The parties acknowledge that certain payments are to be made and certain benefits are to be granted according to certain employment compensation, severance and other employee benefit plan(s) to which Parent will be a party (the “Parent Arrangement(s)”) to certain Seller Stockholders and holders of other securities of Seller (the “Covered Securityholders”).  Parent hereby represents and warrants that all such amounts payable under Parent Arrangement(s) (i) will be paid or granted as compensation for future s ervices to be performed, or future services to be refrained from performing, by the Covered Securityholders (and matters incidental thereto) and (ii) will not be calculated based on the number of shares tendered or to be tendered into the Offer by the applicable Covered Securityholder.  Parent also hereby represents and warrants that (i) the adoption, approval, amendment or modification of each Parent Arrangement will be approved as an employment compensation, severance or other employee benefit arrangement solely by independent directors of Parent in accordance with the requirements of Rule 14d-10(d)(2) under the Exchange Act and the instructions thereto, and (ii) the “safe harbor” provided pursuant to Rule 14d-10(d)(2) will otherwise be applicable thereto assuming that the Seller Board has taken all necessary actions by it to cause such safe harbor to be applicable.

4.9Offer Documents; Proxy Statement; Parent Information.

(a)The Offer Documents will comply in all material respects with the provisions of applicable federal securities laws and, on the date filed with the SEC and on the date first published, sent or given to the Seller Stockholders, shall not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading, except that no representation is made by Parent or Purchaser with respect to information supplied by Seller in writing for inclusion in the Offer Documents.  The informat ion to be supplied in writing by or on behalf of Parent for inclusion in the Schedule 14D-9, on the date the Schedule 14D-9 is filed with the SEC, and on the date the Schedule 14D-9 is first published, sent or given to the Seller Stockholders, shall not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.

(b)The information relating to Parent, Purchaser and their respective Affiliates to be contained in the Proxy Statement (where and to the extent required by applicable Laws to consummate the Merger), and any other documents filed with the SEC in connection with the Merger, will not, on the date the Proxy Statement is first mailed to the Seller Stockholders or, at the time of the Special Meeting, contain any untrue statement of a material fact, or omit to state any material fact required to be stated therein or necessary in order to make the statements therein not false or misleading at the time and in light of the circumstances under which such statement is made.  The Proxy Statement (if any) will comply in all material respects as to form with the requirements of the Exchange Act and the rules and regulations thereunder.

4.10No Other Representations or Warranties.

                Each of Parent and Purchaser acknowledges and agrees that except as expressly set forth in Article V, neither Seller nor any Subsidiary of Seller nor any of their Representatives has made any representation or warranty, express or implied, to Parent, Purchaser or any of their Representatives in connection with this Agreement, the Offer, the Merger or any of the other transactions contemplated hereby.  Without limiting the generality of the foregoing, and except as expressly set forth in Article V, (i) Parent and Purchaser each acknowledges and agrees that neither Seller nor any Subsidiary of Seller nor any of their Representatives has made any representation or warranty, express or implied, as to the accuracy or completeness of any information regarding Seller or any Subsidiary of Seller made available to Parent, Purchaser or any of their Representatives, and (ii) neither Seller nor any other Person shall be subject to any liability to Parent, Purchaser or any other Person, resulting from Seller’s having made available to Parent, Purchaser or any of their Representatives such information, including in the “data room,” management presentations (formal or informal) or in any other form in connection with the transactions contemplated by this Agreement.  Without limiting the foregoing, neither Seller nor any Subsidiary of Seller nor any of their Representatives makes any representation or warranty to Parent or Purchaser with respect to any financial projection or forecas t relating to Seller or any Subsidiary of Seller.

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ARTICLE V

REPRESENTATIONS AND WARRANTIES OF SELLER

Except as set forth in the Seller SEC Documents filed prior to the execution of this Agreement (provided, that, for the purpose of qualifying any representations and warranties contained in this Agreement, (i) only the most recent version of any particular Seller SEC Document shall act to qualify any representation or warranty, and (ii) any “Risk Factors" section, forward looking statement or similar disclaimer included in such Seller SEC Document shall not be taken into account) or as set forth in the disclosure schedules delivered concurrently with the execution of this Agreement to Parent and Purchaser (the “Seller Disclosure Schedule”), which schedules shall identify any excep tions to the representations, warranties and covenants contained in this Agreement (with reference to the particular Section to which such information relates; provided that an item disclosed in any Section shall be deemed to have been disclosed for each other Section of this Agreement to the extent the relevance of such disclosure to such other Section of this Agreement is reasonably apparent on the face of such disclosure); Seller hereby represents and warrants to Parent and Purchaser as follows:

5.1Corporate Organization.

(a)Seller is a corporation duly organized, validly existing and in corporate good standing under the laws of the State of Delaware.  Seller has all requisite corporate power and authority to own, lease or operate all of its properties and assets and to carry on its business as it is now being conducted.  Seller is duly licensed or qualified to do business and is in corporate good standing in each jurisdiction in which the nature of the business conducted by it or the character or location of the properties and assets owned, leased or operated by it makes such licensing or qualification necessary, except where the failure to be so license d or qualified and in corporate good standing has not and would not reasonably be expected to have, either individually or in the aggregate, a Seller Material Adverse Effect.  The Certificate of Incorporation and the Bylaws of Seller, copies of which have previously been made available to Parent and Purchaser, are true, correct, and complete copies of such documents as currently in effect.

(b)Section 5.1(b) of the Seller Disclosure Schedule sets forth the name and jurisdiction of organization of each Subsidiary of Seller.  Each of Seller’s Subsidiaries is duly organized, validly existing and, if applicable, in corporate good standing under the laws of the jurisdiction of its organization.  Each of Seller’s Subsidiaries has all requisite corporate power and authority to own, lease or operate all of its properties and assets and to carry on its business as it is now being conducted.  Each of Seller’s Subsidiaries is duly licensed or qualified to do business in each jurisdiction in which the nature of the business conducted by it or the character or location of the properties and assets owned, leased, or operated by it makes such licensing or qualification necessary, except where the failure to be so licensed or qualified and in good standing has not had and would not reasonably be expected to have, either individually or in the aggregate, a Seller Material Adverse Effect.

(c)The articles or certificate of incorporation and bylaws or equivalent organizational documents of each of the Subsidiaries of the Seller, copies of which have previously been made available to Parent and Purchaser, are true, correct, and complete copies of such documents as currently in effect.

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5.2Capitalization.

(a)The authorized capital stock of Seller consists of 100,000,000 shares of Seller Common Stock and 5,000,000 shares of preferred stock, $0.0001 par value per share (the “Seller Preferred Stock”), of which 100,000 shares have been designated as Series A Junior Participating Cumulative Preferred Stock and reserved for issuance pursuant to the Rights Agreement.  At the close of business on the day prior to the date of this Agreement, there were 17,731,076 shares of Seller Common Stock and no shares of Seller Preferred Stock issued and outstanding.  At th e close of business on the day prior to the date of this Agreement, there were noshares of Seller Common Stock and no shares of Seller Preferred Stock held in the treasury of Seller.  In addition, at the close of business on the day prior to the date of this Agreement, there were 5,051,109 shares of Seller Common Stock reserved for future issuance in connection with the exercise of Seller Stock Options and Seller Warrants, vesting of Seller Restricted Stock Units and the ESPP, in the case of Seller Stock Options and Seller Restricted Stock Units, subject to adjustment on the terms set forth in the Seller Stock Plans, or any other agreement, resolution or covenant of the Seller Board.  All issued and outstanding shares of Seller Common Stock have been, and all shares of Seller Common Stock that may be issued pursuant to the exercise or vesting, as applicable, of outstanding Seller Stock Options and Seller Restricted Stock Units will be, when issued in accordance with the terms thereof, duly authorized, validly issued, fully paid, nonassessable and free of preemptive rights, with no personal liability attaching to the ownership thereof except as required by Law.  There are no bonds, debentures, notes or other indebtedness having general voting rights, or convertible into securities having such rights (“Voting Debt”), of Seller or its Subsidiary issued and outstanding.  Except for the Seller Stock Plans, Seller Restricted Stock Awards, Seller Restricted Stock Units, Seller Warrants, Rights Agreement or as reflected in Section 5.2(a) of the Seller Disclosure Schedule, Seller does not have and is not bound by any outstanding subscriptions, options, warrants, calls, commitments, rights agr eements or agreements of any character calling for Seller to issue, deliver or sell, or cause to be issued, delivered or sold any shares of Seller Common Stock or Seller Preferred Stock or any other equity security or Voting Debt of Seller or any Subsidiary of Seller or any securities convertible into, exchangeable for or representing the right to subscribe for, purchase or otherwise receive any shares of Seller Common Stock or Seller Preferred Stock or any other equity security or Voting Debt of Seller or any Subsidiary of Seller or obligating Seller or any Subsidiary of Seller to grant, extend or enter into any such subscriptions, options, warrants, calls, commitments, rights agreements or any other similar agreements.  Except as set forth in Section 5.2(a) of the Seller Disclosure Schedule, there are no outstanding contractual obligations of S eller to repurchase, redeem or otherwise acquire any shares of capital stock of, or other equity interests or Voting Debt in Seller or to provide funds to, or make any investment (in the form of a loan, capital contribution or otherwise) in, any Subsidiary of Seller.  No Subsidiary of Seller owns any shares of Seller Common Stock.

(b)As of August 30, 2010, Seller had outstanding Seller Stock Options to purchase 1,247,753 shares of Seller Common Stock, outstanding, unvested Seller Restricted Stock Awards representing 314,836 shares of Seller Common Stock, and outstanding unvested Seller Restricted Stock Units representing the right to receive 1,265,099 shares of Seller Common Stock, under the Seller Stock Plans and subject to adjustment on the terms set forth therein. All of such Seller Stock Options, Seller Restricted Stock and Seller Restricted Stock Units have been granted to service providers of Seller and its Subsidiaries in the ordinary course of business pursuant to the Seller Stock Plans.  Section 5.2(b) of the Seller Disclosure Schedule sets forth (i) (A) the name of each holder of a Seller Stock Option, (B) the date each Seller Stock Option was granted, (C) the number of shares of Seller Common Stock subject to each such Seller Stock Option, and (D) the price at which each such Seller Stock Option may be exercised; (ii) (A) the name of each holder of Seller Restricted Stock Award, (B) the date such Seller Restricted Stock Award was granted and (C) the number of shares of Seller Common Stock subject to each such Seller Restricted Stock Award; (iii) (A) the name of each holder of Seller Restricted Stock Units, (B) the date the award of such Seller Restricted Stock Units was granted and (C) the number of shares of Seller Common Stock subject to each such award of Seller Restricted Stock Units.  Except as set forth in Section 5.2(b) of the Seller Disclosure Schedule, there are no shares of Seller Common Stock outstanding that are subject to vesting over time or upon the satisfaction of any condition precedent, or which are otherwise subject to any right or obligation of repurchase or redemption on the part of Seller.

(c)Section 5.2(c) of the Seller Disclosure Schedule lists for each Subsidiary of Seller the percentage of equity securities owned or controlled, directly or indirectly, by Seller as of the date hereof.  Except as set forth in Section 5.2(c) of the Seller Disclosure Schedule, no Subsidiary of Seller has or is bound by any outstanding subscriptions, options, warrants, calls, commitments, rights agreements or agreements of any ch aracter calling for it to issue, deliver or sell, or cause to be issued, delivered or sold any of its equity securities or any securities convertible into, exchangeable for or representing the right to subscribe for, purchase or otherwise receive any such equity security or obligating such Subsidiary to grant, extend or enter into any such subscriptions, options, warrants, calls, commitments, rights agreements or other similar agreements.  There are no outstanding contractual obligations of any Subsidiary of Seller to repurchase, redeem or otherwise acquire any of its capital stock or other equity interests.  All of the interests or shares of capital stock of each of the Subsidiaries of Seller are validly issued, fully paid (to the extent required under the applicable governing documents) and nonassessable and, with respect to such interests or shares held directly or indirectly by Seller, are owned by Seller free and clear of any Encumbrances.

(d)There are no voting trusts or other agreements to which Seller or any of its Subsidiaries is a party with respect to the voting of any shares of Seller Common Stock or any capital stock of, or other equity interest of, Seller or any of its Subsidiaries.  Except as set forth in Section 5.2(d) of the Seller Disclosure Schedule, neither Seller nor any of its Subsidiaries has granted any preemptive rights, anti-dilutive rights or rights of first refusal, registration rights or similar rights with respect to its shares of capital stock that are in effect.

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5.3Authority.

(a)Seller has all requisite corporate power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby and perform its obligations hereunder, including the Offer and the Merger, subject to obtaining any required approval of the Seller Stockholders to adopt and approve this Agreement and approve the Merger.  The adoption, execution, delivery and performance of this Agreement and the approval of the consummation of the transactions contemplated hereby have been duly authorized by all necessary corporate action on the part of Seller and no other corporate proceedings on the part of Seller are necessary to authorize the adoption, execution, delivery and performance of this Agreement or to consummate each of the Offer and the Merger and the other transactions contemplated hereby, except for the adoption and approval of this Agreement by the Seller Stockholders (if required by Law) and the filing of the Certificate of Merger with the Secretary of the State of Delaware.

(b)The Seller Board has (i) unanimously determined and declared that this Agreement, the Transaction and each of the Offer and the Merger are advisable and the best interests of Seller and the Seller Stockholders, (ii) unanimously approved the execution, delivery and performance of this Agreement and, subject to the terms and conditions set forth herein, the consummation of the Offer, the Merger and the other transactions contemplated herein, and (iii) subject to Section 7.2, unanimously recommended that the Seller Stockholders accept the Offer, tender their shares of Seller Common Stock into the Offer, and, if required by applicable Law, adopt and approve this Agreement and approve the Merger.  This Agreement has been duly and validly executed and delivered by Seller and (assuming due authorization, execution and delivery by Parent and Purchaser) constitutes the valid and binding obligations of Seller, enforceable against Seller in accordance with its terms.

(c)Seller has taken all actions necessary to: (i) render the Rights Agreement inapplicable to this Agreement and the Support Agreements, and the transactions contemplated by this Agreement, the Support Agreements, the Offer and the Merger, (ii) ensure that in connection with the transactions contemplated by this Agreement and the Support Agreements (A) neither Parent nor the Purchaser is or will be an “Acquiring Person” (as defined in the Rights Agreement) and (B) none of a “Stock Acquisition Date,” a “Distribution Date,” a “Section 11(a)(ii) Event” or a “Section 13 Event” (as such terms are define d in the Rights Agreement) occurs, in each case of clauses (A) and (B), solely by reason of the execution of this Agreement or the Support Agreements, or the consummation of the Merger, the Offer or the other transactions contemplated by this Agreement or the Support Agreements and (iii) provide that the “Expiration Date” (as defined in the Rights Agreement) shall occur immediately prior to the Effective Time. Except as described in this Section 5.3(c), the Rights Agreement has not been amended or modified.

                 5.4No Violation; Required Filings and Consents.

Assuming the adoption and approval of this Agreement by the Seller Stockholders and except (a) for filings, permits, authorizations, consents and approvals, and for the termination or expiration, as applicable, of any applicable waiting periods, as may be required under, and other applicable requirements of the Exchange Act, the Securities Act, the HSR Act and other Regulatory Laws, and state securities or state “Blue Sky” laws, (b) for filing of the Certificate of Merger, and (c) as otherwise set forth in Section 5.4 of the Seller Disclosure Schedule, none of the execution, delivery or performance of this Agreement by Seller, the consummation by Seller of the transactions contemplated hereby, including the Offer and the Merger, or compliance by Seller with any of the provisions hereof will (i) conflict with or result in any breach of any provision of the organizational documents of Seller, (ii) require Seller or any Subsidiaries of Seller to make any filing with, give any notice to, or obtain any permit, authorization, consent or approval of, any Governmental Authority, (iii) (A) require Seller or any Subsidiaries of Seller to give any notice to, or obtain any consent from, any Person under, or (B) result in a violation or breach of, or constitute (with or without due notice or lapse of time or both) a default (or give rise to any right of termination, modification, cancellation or acceleration) under, any of the terms, conditions or provisions of any material note, bond, mortgage, indenture, lease, license, contract, agreement or other instrument or obligation to which Seller is a party or by which it or any of its properties or assets may be bound or (iv) violate any order, writ, injunction, decree, statute, rule or regul ation applicable to Seller or any of its properties or assets, excluding from the foregoing clauses (ii), (iii) and (iv) such filings, notices, permits, authorizations, consents, approvals, violations, breaches, defaults or rights of termination, cancellation or acceleration that, individually or in the aggregate, would not (A) prevent or materially delay consummation of the Offer and the Merger, (B) otherwise prevent or materially delay performance by Seller of its material obligations under this Agreement, or (C) reasonably be expected to have a Seller Material Adverse Effect.

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5.5SEC Filings; Controls and Procedures.

(a)Seller has filed or furnished (as applicable) all registration statements, forms, reports, certifications and other documents required to be filed or furnished by Seller with the SEC since Seller became a SEC reporting company, and has made available to Parent complete and accurate copies of all registration statements, forms, reports, certifications and other documents filed by Seller with the SEC since Seller became a SEC reporting company, including all certifications and statements required by (i) Rule 13a-14 or 15d-14 of the Exchange Act or (ii) 18 U.S.C. §1350 (Section 906 of the Sarbanes-Oxley Act).  All such reg istration statements, forms, reports, certifications and other documents (including those that Seller may file after the date hereof until the Closing) are referred to herein as the “Seller SEC Documents.” All of the Seller SEC Documents are publicly available on the SEC’s EDGAR system.  Seller has made available to Parent complete and accurate copies of all comment letters received by Seller from the staff of the SEC and all responses to such comment letters by or on behalf of Seller, in each case since Seller became a SEC reporting company.  The Seller SEC Documents (i) were or will be filed or furnished on a timely basis, (ii) at the time filed or furnished, were or will be prepared in compliance as to form in all material respects with the applicable requirements of the Securities Act and the Exchange Act, as the case may be, and the rules and regulations of the SEC thereunder applicable to such Se ller SEC Documents, and (iii) did not or will not at the time they were or are filed or furnished contain any untrue statement of a material fact or omit to state a material fact required to be stated in such Seller SEC Documents or necessary in order to make the statements in such Seller SEC Documents, in the light of the circumstances under which they were made, not misleading.

(b)Seller: (i) maintains a system of internal accounting controls sufficient to provide reasonable assurance that: (A) transactions are executed in accordance with management’s general or specific authorizations; (B) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain asset accountability; and (C) access to assets is permitted only in accordance with management’s general or specific authorization; (ii) has implemented and maintain disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) of the Exchange Act) that are designed to ensure that material inf ormation relating to Seller, including its consolidated Subsidiaries, is made known to the chief executive officer and the chief financial officer of Seller by others within those entities as appropriate to allow timely decisions regarding required disclosure; and (iii) has disclosed, based on its most recent evaluation prior to the date hereof, to Seller’s outside auditors and the audit committee of the Seller Board, (A) any significant deficiencies and material weaknesses of which Seller has knowledge in the design or operation of internal controls over financial reporting that are reasonably likely to adversely affect in any material respect Seller’s ability to record, process, summarize and report financial information, and (B) any fraud, whether or not material, that involves management or other employees who have a significant role in Seller’s internal control over financial reporting.

(c)Except as previously disclosed by Seller to Parent, since Seller became a SEC reporting company, to Seller’s knowledge, no Key Employee or member of the Seller Board has received or otherwise had or obtained knowledge of any substantive complaint, allegation, assertion or claim, whether written or oral, of the violation or possible violation of any applicable Laws of the type described in Section 806 of the Sarbanes-Oxley Act by Seller or any Subsidiaries of Seller.

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5.6Financial Statements.

 Each of the consolidated financial statements (including, in each case, any related notes and schedules) contained or to be contained in the Seller SEC Documents at the time filed (the “Seller Financial Statements”) (i) has complied or will comply as to form in all material respects with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto (including Regulation S-X), (ii) were or will be prepared in accordance with GAAP applied on a consistent basis throughout the periods involved and at the dates involved (except as may be indicated in the notes to such financial statements or, in the case of unaudited statements, as permitted by the SEC on Form 10-Q under the Exchange Act), and ( iii) fairly presented or will fairly present the consolidated financial position of Seller and its consolidated Subsidiaries as of the dates thereof and the consolidated statement of operations, cash flows and changes in stockholders’ equity for the periods indicated, consistent with the books and records of Seller and its consolidated Subsidiaries, except that the unaudited interim financial statements were or are subject to normal year-end adjustments which were not or will not be material in amount or effect.  The consolidated, audited balance sheet of Seller as of March 31, 2010 is referred to herein as the “Seller Balance Sheet.”

                5.7Absence of Undisclosed Liabilities.

 Except as set forth in Section 5.7 of the Seller Disclosure Schedule, neither Seller nor any of its consolidated Subsidiaries has any obligations or liabilities (whether or not accrued, contingent or otherwise, and whether or not required to be reflected in financial statements in accordance with GAAP), except for: (i) liabilities disclosed in the Seller Financial Statements contained in the Seller SEC Documents filed with the SEC prior to the date of this Agreement; (ii) liabilities incurred in the ordinary course of business consistent with past practice since the date of the Seller Balance Sheet; (iii) liabilities incurred in connection with the transactions contemplated by this Agreement (including the Offer and the Merger); and (iv)  ;liabilities that have not had, and would not reasonably be expected to result in, a Seller Material Adverse Effect.

5.8Absence of Certain Changes or Events.

 Except as set forth in Section 5.8 of the Seller Disclosure Schedule, since the date of the Seller Balance Sheet, (a) Seller and the Subsidiaries of Seller have conducted their respective business in all material respects in the ordinary course consistent with their past practice, (b) other than as a result of the transactions contemplated by this Agreement, there has not been: (i) any adverse change in the financial condition, operations or business of Seller that would reasonably be expected to have a Seller Material Adverse Effect; (ii) any damage, destruction, or loss to the business or properties of Seller (whether or not covered by insurance) that would reasonably be expected to have a Seller Material Adverse Effect; (iii) any declaration, setting as ide, or payment of any dividend or other distribution in respect of the Seller Common Stock, or any direct or indirect redemption, purchase or any other acquisition by Seller of any Seller Common Stock; (iv) any material labor dispute (other than routine grievances); (v) any increase in compensation, bonus, deferred compensation, stock options or other consideration of any employee or director other than in the ordinary course of business consistent with past practice; (vi) any transfer, sale, lease, sublease or license or other disposition of material assets or properties of Seller or the Subsidiaries of Seller, other than in the ordinary course of business consistent with past practice; (vii) any write down or write up of the value of any receivable or revalue of any assets of Seller or any Subsidiaries of Seller other than in the ordinary course of business consistent with past practice; or (viii) any settlement, payment or discharge of any litigation, investigation, or arbitration, other than the settlem ent, payment, discharge or satisfaction in the ordinary course of business consistent with past practice, and (c) there has not been any change, circumstance or event which has had, or would reasonably be expected to have, individually or in the aggregate, a Seller Material Adverse Effect.

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5.9Broker’s Fees.

Neither Seller nor any of its officers, directors, employees, or agents has employed any broker, finder or financial advisor or incurred any liability for any fees or commissions in connection with any of the transactions contemplated by this Agreement (including the Offer and the Merger), except for fees and commissions incurred in connection with the engagement of the financial advisor set forth in Section 5.9 of the Seller Disclosure Schedule (the “Seller’s Financial Advisor”) and for legal, accounting and other professional fees payable in connection with the transactions contemplated hereby, all of which will be payable by Seller.  True, correct and complete copies of all agreements between Seller and Seller’s Financial Advisor concerning this Agreement and the Transaction, including, without limitation, any fee arrangements, have been previously made available to Parent.

5.10Legal Proceedings.

  Except as set forth in Section 5.10 of the Seller Disclosure Schedule, (a) there is no suit, claim (including any labor- or employment- related claim), action, arbitration, investigation of a Governmental Authority, alternative dispute resolution action or any other judicial, administrative or arbitral proceeding (any of the foregoing, an “Action”) pending or, to the knowledge of Seller, threatened against Seller or any Subsidiary of Seller, and (b) neither Seller nor any Subsidiary of Seller is subject to any outstanding order, writ, judgment, injunction or decree of any Governmental Authority, which, in the case of (a) or (b), (i) would, individually or in the aggregate, ( A) prevent or materially delay the consummation of the Offer or the Merger, or (B) otherwise prevent or materially delay performance by Seller of any of its material obligations under this Agreement, or (ii) has or would reasonably be expected to, individually or in the aggregate, result in a Seller Material Adverse Effect.

5.11Permits; Compliance with Applicable Laws.

(a)To the knowledge of Seller, Seller and the Subsidiaries of Seller are in compliance with the terms of, all permits, licenses, authorizations, consents, approvals and franchises from Governmental Authorities required to conduct their respective businesses as currently conducted (the “Seller Governmental Approvals”), and no suspension or cancellation of any such Seller Governmental Approvals is pending or, to the knowledge of Seller, threatened in writing, except for such noncompliance, suspensions or cancellations that would not, individually or in the aggregate, have a Seller Ma terial Adverse Effect.  Seller and each Subsidiary of Seller are in compliance with all applicable Laws, except for any noncompliance that would not, individually or in the aggregate, have a Seller Material Adverse Effect.

(b)To the knowledge of Seller, neither Seller nor any of its Subsidiaries (including any of their officers, directors, agents, employees or other Person acting on their behalf) has taken any action which would cause it to be in violation of the Foreign Corrupt Practices Act of 1977, as amended, or any rules or regulations thereunder or any similar anti-corruption or Applicable Law with respect to anti-bribery in any jurisdiction other than the United States (collectively, the “FCPA"), used any corporate funds for unlawful contributions, gifts, entertainment or other unlawful expenses rel ating to political activity, made, offered or authorized any unlawful payment to foreign or domestic government officials or employees, whether directly or indirectly, or made, offered or authorized any bribe, rebate, payoff, influence payment, kickback or other similar unlawful payment, whether directly or indirectly.

5.12Taxes and Tax Returns.

 Each of Seller and its Subsidiaries has (i) timely filed (or has caused to be timely filed on its behalf), after taking into account any extension of time within which to file, all material Tax Returns required to be filed by it and they are true, accurate and complete; and (ii) timely paid (or has caused to be timely paid on its behalf), all material Taxes required to have been paid by it, except for Taxes that are being contested in good faith by appropriate proceedings and for which adequate reserves have been established in accordance with GAAP.  The most recent financial statements contained in the Seller SEC Documents reflect, an adequate reserve (excluding any reserve for deferred Taxes established to reflect timing differences between boo k and Tax income) for all unpaid Taxes that may be payable by Seller and each Seller Subsidiary for all taxable periods and portions thereof through the date of such financial statements in accordance with GAAP.  Neither the Seller nor any Subsidiary is under audit with respect to Taxes, and has not received notice that it may be subject to audit in the future.  Neither Seller nor any Subsidiary has received any written inquiry as to whether the respective company has an obligation to file a Tax Return in a jurisdiction in which it has not filed a Tax Return.  Neither Seller nor any Subsidiary has any liability for Taxes for any other person pursuant to Treas. Reg. 1.1502-6 or similar state, local or non-U.S. tax rules or by contract or otherwise.

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5.13Employee Benefit Programs.

                                (a)Except as set forth in Section 5.13(a) of the Seller Disclosure Schedule, none of Seller, any of the Seller Subsidiaries or any other ERISA Affiliate contributes to or maintains (or is obligated to contribute to or maintain), and none of Seller, any of the Seller Subsidiaries or any other ERISA Affiliate may incur any liability under any “employee pension benefit plan” (the “Seller Pension Plans”), as such term is defined in Section 3(2) of ERISA, “employee welfare benefit plan” (the “Seller Benefit Plans”), as such term is defined in Section 3(1) of ERISA, employment, severance or similar agreement, contract or policy, stock option plan, restricted stock plan, stock purchase plan, deferred compensation plan, bonus or incentive plan, or other employee benefit plan for Seller Personnel or their respective dependents or beneficiaries, or any other plan, program or arrangement of the same or similar nature that provides benefits to non-employee directors of Seller, any Seller Subsidiary or any other ERISA Affiliate (collectively, the “Seller Other Plans”).

(b)Seller has made available to Parent complete and accurate copies of each of the following with respect to each of the Seller Pension Plans, Seller Benefit Plans and Seller Other Plans: (i) plan document and any amendments thereto and a description if such Seller Pension Plan, Seller Benefit Plan or Seller Other Plan is not in writing; (ii) trust agreement or insurance contract (including any fiduciary liability policy or fidelity bond), if any; (iii) most recent IRS determination or opinion letter, if any; (iv) the annual report on Form 5500 for the three most recent plan years; (v) the financial and/or actuarial report, if any, for the three most r ecent plan years; and (vi) summary plan description, any summary of material modifications thereto, and any material employee communications.

(c)Except as set forth in Section 5.13(c) of the Seller Disclosure Schedule, each of the Seller Pension Plans, Seller Benefit Plans and Seller Other Plans, which are maintained or contributed to by Seller, any Subsidiary of Seller or any other ERISA Affiliate, has been and is administered in material compliance with its terms and has been and is in material compliance with the applicable provisions of ERISA (including, but not limited to, the funding and prohibited transactions provisions thereof), the Co de and all other applicable Laws.

(d)None of Seller, any of the Seller Subsidiaries nor any other ERISA Affiliate sponsor, maintain or contribute to, has ever sponsored, maintained or contributed to a plan subject to Title IV (including, without limitation, a “multiemployer plan” (within the meaning of Section 3(37) of ERISA)) or Part 3 of Title I of ERISA or Section 412 of the Code, and neither Seller nor any ERISA Affiliate could be subject to any liability under Title IV or Part 3 of Title I of ERISA.  Each of the Seller Pension Plans that is intended to be a qualified plan within the meaning of Code Section 401(a) has received a favorable determination or opinion l etter from the IRS and such letter remains in effect and has not been revoked.

(e)Except as set forth in Section 5.13(e) of the Seller Disclosure Schedule, neither Seller nor any Subsidiary of Seller provides or has agreed to provide healthcare or any other non-pension benefits to any employees after their employment is terminated (other than as required by Part 6 of Subtitle B of Title I of ERISA or state health continuation Laws).  No Seller Benefit Plan is a self-funded “employee welfare benefit plan.”

(f)Except as set forth in Section 5.13(f) of the Seller Disclosure Schedule, no lawsuits, governmental administrative proceedings, claims (other than routine claims for benefits) or complaints to, or by, any Person or Governmental Authority have been filed, are pending, or to the knowledge of Seller, threatened with respect to any Seller Pension Plan, Seller Benefit Plan or Seller Other Plan.  Except as set forth in Section 5.13(f) of the Seller Disclosure Schedule, there is no written correspondence between Seller, any Subsidiary of Seller or any other ERISA Affiliate and any Governmental Authority related to any Seller Pension Plan, Seller Benefit Plan or Seller Other Plan concerning any matter that could result in any material liability to Parent, the Surviving Corporation, Seller, or any Seller Pension Plan, Seller Benefit Plan or Seller Other Plan.

(g)Each Seller Pension Plan, Seller Benefit Plan and Seller Other Plan that is a “nonqualified deferred compensation plan” within the meaning of Section 409A of the Code has been operated in material compliance with Section 409A of the Code since January 1, 2005, based upon a good faith, reasonable interpretation of Section 409A of the Code, and the regulations and guidance issued thereunder.  Each such “nonqualified deferred compensation plan” was, as of January 1, 2009, in documentary and operational compliance with Section 409A of the Code, and the regulations and guidance issued thereunder.  Since January 1, 2 009, each such “nonqualified deferred compensation plan” has remained in documentary and operational compliance with Section 409A of the Code, and the regulations and guidance issued thereunder.  The exercise price of all Seller Stock Options is at least equal to the fair market value of the Seller Common Stock on the date such options were granted based on Treasury Regulation Section 1.409A-1(b)(5)(iv) and applicable guidance.

(h)The parties acknowledge that certain payments have been made or are to be made and certain benefits have been granted or are to be granted according to employment compensation, severance and other employee benefit plans of Seller, including the Seller Benefit Plans, the Seller Pension Plans and the Seller Other Plans (collectively, the “Arrangements”), to the Covered Securityholders.  Seller hereby represents and warrants that all such amounts payable under the Arrangements (i) are being paid or granted as compensation for past services performed, future services to be performed, or future services to be refrained from performing, by the Covered Securityholders (and matters incidental thereto) and (ii) are not calculated based on the number of shares tendered or to be tendered into the Offer by the applicable Covered Securityholder.  Seller also hereby represents and warrants that the Seller Board or the Compensation Committee thereof (the “Seller Compensation Committee”) (i) at a meeting duly called and held at which all members of the Seller Compensation Committee were present, duly adopted resolutions approving as an “employment compensation, severance or other employee benefit arrangement” within the meaning of Rule 14d-10(d)(1) under the Exchange Act (an “Employment Compensation Arrangement”) (A) each Arrangement presented to the Seller Compensation Committee on or prior to the date hereof, and (B) the treatment of the Seller Stock Options, Seller Restricted Stock Awards and Seller Restricted Stock Units in accordance with the terms set forth in this Agreement, and (C) the terms of Section 7.4 and Section 7.5 of this Agreement, which resolutions have not been rescinded, modified or withdrawn in any way, and (ii) has taken all other actions necessary to satisfy the requirements of the non-exclusive safe harbor under Rule 14d-10(d)(2) under the Exchange Act with respect to the foregoing arrangements.

(i)Except as set forth in Section 5.13(i) of the Seller Disclosure Schedule, the execution and delivery of this Agreement and the performance of the transactions contemplated hereby, will not (either alone or upon the occurrence of any additional or subsequent events) constitute an event under any Seller Pension Plan, Seller Benefit Plan or Seller Other Plan that will (i) result in any payment (whether of severance pay or otherwise) becoming due to any current or former employee, director of, or consultants to, Seller, (ii) result in the acceleration of the time of payment, funding or vesting of any benefits under any Seller Pension Plan, Seller Benefit Pla n or Seller Other Plan, (iii) increase any amount of benefits under any Seller Pension Plan, Seller Benefit Plan or Seller Other Plan, (iv) require any contribution or payments to fund any obligations under any Seller Pension Plan, Seller Benefit Plan or Seller Other Plan, (v) result in the triggering or imposition of any restrictions or limitations on the right of Seller to amend or terminate any Seller Pension Plan, Seller Benefit Plan or Seller Other Plan or (vi) give rise to any amount that would not be deductible by Seller under Section 280G of the Code.

(j)No employee or other service provider of Seller or any Seller Subsidiary is entitled to a tax gross-up payment pursuant to any Seller Pension Plan, Seller Benefit Plan or Seller Other Plan in the event of the imposition of any additional tax imposed on such service provider under Section 280G or Section 409A of the Code.

(k)The treatment of the Seller Stock Options, the Seller Restricted Stock Awards and the Seller Restricted Stock Units pursuant to Section 3.4 of this Agreement is permitted by the terms of the Seller Stock Plans, and any other agreements pursuant to which such equity awards were granted, without the consent of the holder of such awards.  The treatment of the ESPP pursuant to Section 3.4(d) of this Agreement is permitted by the terms of that plan without the consent of the participants in such plan.

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5.14Labor and Employment Matters.

(a)Seller and Each Subsidiary of Seller are in material compliance with all federal, state, and foreign Laws respecting employment and employment practices, terms and conditions of employment, and wages and hours, including, to the extent applicable, Title VII of the Civil Rights Act of 1964, as amended, the Equal Pay Act of 1967, as amended, the Age Discrimination in Employment Act of 1967, as amended, the Americans with Disabilities Act, as amended, state anti-discrimination laws and other than normal accruals of wages during regular payroll cycles, there are no arrearages in the payment of wages except for possible violations or arrearages.  To Seller’s knowledge, as of the date hereof, (i) there are no audits or investigations pending or scheduled by any Governmental Authority pertaining to the employment practices of Seller and (ii) no written complaints relating to employment practices of Seller have been made to any Governmental Authority or submitted to Seller.

(b)Neither Seller nor any Subsidiary of Seller is a party to, or otherwise bound by, any collective bargaining agreement, contract or other agreement or understanding with a labor union or labor organization except outside of the United States in the ordinary course of business.  To the knowledge of Seller, neither Seller nor any Subsidiary of Seller is subject to any charge, demand, petition or representation proceeding seeking to compel, require or demand it to bargain with any labor union or labor organization nor is there pending or threatened, any labor strike or lockout involving Seller or any Subsidiary of Seller.

(c)All current and former employees, independent contractors and leased employees have been properly classified as such by Seller and each of its Subsidiaries for tax purposes and for compliance with all other Laws. Seller and each of its Subsidiaries has properly classified its employees as exempt or non-exempt under the Fair Labor Standards Act and applicable state laws. Neither Seller nor any of its Subsidiaries is delinquent in payments to any individuals for any wages, salaries, commissions, bonuses or other direct or indirect compensation for any services performed by them or amounts required to be reimbursed to such indi viduals. 

(d)Seller and each Subsidiary of Seller are in compliance with all Laws respecting government contractors, including but not limited to the regulations of the Office of Federal Contract Compliance Programs (“OFCCP”) and the obligation to maintain a current affirmative action plan.  Except as set forth in Section 5.14(d) of the Seller Disclosure Schedule, neither Seller nor any of its Subsidiaries has been subject to an audit by the OFCCP within the past 5 years.

5.15Material Contracts.

  Except as set forth in Section 5.15 of the Seller Disclosure Schedule or as filed as exhibits to the Seller SEC Documents prior to the date of this Agreement, and except for this Agreement, neither Seller nor any Subsidiary of Seller is a party to or is bound by any contract, arrangement, commitment or understanding (i) that is a “material contract” (as such term is defined in Item 601(b)(10) of Regulation S-K of the Exchange Act), (ii) which involves payments to Seller in the aggregate of $75,000 or more and which contains a provision or provisions limiting the ability of Seller or any Subsidiary of Seller to compete or engage in any line of business or to solicit business in any geographic area, (iii) which involves payments to Sel ler in the aggregate of $75,000 or more and which contains a provision or provisions providing for exclusivity by Seller or any Subsidiary of Seller with respect to any material products or services sold or purchased by Seller or any Subsidiary of Seller, or (iv) that by its terms would prohibit or materially delay the consummation of the Offer, the Merger or any of the other transactions contemplated by this Agreement.  Each contract, arrangement, commitment or understanding of the type described above in this Section 5.15, whether or not set forth in Section 5.15 of the Seller Disclosure Schedule, is referred to herein as a “Seller Contract.”  All of the Seller Contracts are valid and binding on Seller or any Subsidiary of Seller, as the case may be, and, to Seller’s knowledge, each other party thereto, as applicable, and in full force and effect, subject to applicable bankruptcy, insolvency, moratorium or other similar Laws relating to creditors’ rights and gene ral principles of equity.  Neither Seller nor any Subsidiary of Seller has, and to the knowledge of Seller, none of the other parties thereto have, violated in any material respect any provision of, or committed or failed to perform any act, and no event or condition exists, which with or without notice, lapse of time or both would constitute a material default under the provisions of any Seller Contract, except in each case for those violations and defaults which, individually or in the aggregate, would not reasonably be expected to result in a Seller Material Adverse Effect and neither Seller nor any Subsidiary of Seller has received written notice of any of the foregoing.

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5.16Properties.

(a)Section 5.16(a) of the Seller Disclosure Schedule sets forth a complete and accurate list of all real property owned by Seller and any Subsidiary of Seller (collectively, the “Owned Real Property”). Seller or a Subsidiary of Seller, as applicable, has good and marketable title to the Owned Real Property, free and clear of all Encumbrances, other than Permitted Encumbrances.

(b)Section 5.16(b) of the Seller Disclosure Schedule sets forth a complete and accurate list of all real property leased, subleased or licensed by Seller or a Subsidiary of Seller (collectively “Seller Leases”) and the location of the premises.  Neither Seller nor any Subsidiary of Seller nor, to Seller’s knowledge, any other party to any Seller Lease, is in default under any of the Seller Leases, except where the existence of such defaults, individually or in the aggregate, has not had, and would not reasonably be expected to result in, a Seller Material Adverse Effect.  Each of the Seller Leases is in full force and effect and is enforceable against Seller or a Subsidiary of Seller, as the case may be, and, to Seller’s knowledge, against each other party thereto, in accordance with its terms and shall not cease to be in full force and effect as a result of the transactions contemplated by this Agreement.  Neither Seller nor a Subsidiary of Seller leases, subleases or licenses any real property to any Person other than Seller and a Subsidiary of Seller.  Seller has made available to Parent complete and accurate copies of all Seller Leases.

5.17Environmental Liability.

 There are, and have been, no legal, administrative, arbitral or other proceedings, claims, actions, causes of action, private environmental investigations or remediation activities or governmental investigations pending or, to Seller’s knowledge, threatened, of any nature seeking to impose, or that are reasonably likely to result in the imposition, on Seller or a Subsidiary of Seller of any liability or obligation arising under common law, under any lease or sublease, or under any foreign, local, state or federal environmental statute, regulation, ordinance or Law including the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, which liability or obligation has had or would reasonably be expected to have, either individually or in the aggregate, a Seller Material Adverse Effect.  To the knowledge of Seller, there is no reasonable basis for any such proceeding, claim, action or governmental investigation that would impose any liability or obligation that would be reasonably likely to have, individually or in the aggregate, a Seller Material Adverse Effect.  Neither Seller nor a Subsidiary of Seller is, or has been, subject to any agreement, order, judgment, decree, letter or memorandum by or with any Governmental Authority or third party imposing any liability or obligation with respect to the foregoing that would reasonably be expected to have, either individually or in the aggregate, a Seller Material Adverse Effect.

5.18State Takeover Laws; Required Stockholder Vote.

(a)The Seller Board has approved this Agreement and the Support Agreements and has taken all other requisite action such that the provisions of any anti-takeover laws and regulations of any Governmental Authority, including Section 203 of the DGCL and any provisions of Seller’s Certificate of Incorporation relating to special voting requirements for certain business combinations, will not apply to this Agreement, the Support Agreements or any of the transactions contemplated hereby or thereby.

(b)The only votes of holders of any class of capital stock of Seller that may be necessary to adopt and approve this Agreement and approve the Merger is the adoption and approval of this Agreement and the Merger by the affirmative vote of a majority of the outstanding shares of Seller Common Stock, voting as a single class, in the event that a vote of Stockholders is required by applicable Law (“Seller Stockholder Approval”).

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5.19Intellectual Property.

(a)Section 5.19(a) of the Seller Disclosure Schedule contains a complete and accurate list of all (i) Patents owned by Seller or a Subsidiary of Seller (“Seller Patents”), (ii) registered Marks owned by Seller or a Subsidiary of Seller (“Seller Marks”), and (iii) registered Copyrights owned by Seller or a Subsidiary of Seller (“Seller Copyrights”).  Complete and correct copies of all Seller Patents listed on Section 5.19(a) of the Seller Disclosure Schedule have been provided or made available to Parent.

(b)Except as set forth in Section 5.19(b) of the Seller Disclosure Schedule:

                                                                (i)Seller or a Subsidiary of Seller owns all right, title and interest in and to the Seller Intellectual Property Assets, listed on Section 5.19(a) of the Seller Disc losure Schedule, free and clear of any and all Encumbrances;

                                                                (ii)the execution and delivery of this Agreement and Seller’s performance of its obligations herein and the occurrence of the Acceptance Date or the Closing shall not, whether immediately or through the passage of time, const itute an event of default under or otherwise impair Seller’s rights under any license or similar agreement pursuant to which Seller obtained and maintains a license or similar right to use any Intellectual Property Asset necessary for the conduct of Seller’s Business, except for such defaults or impairments that would not, individually or in the aggregate, have a Seller Material Adverse Effect;

                                                                (iii)all Seller Intellectual Property Assets listed in Section 5.19(a) of the Seller Disclosure Schedule that are issued by, registered or the subject of an application fi led with, as applicable, the U.S. Patent and Trademark Office, the U.S. Copyright Office or in any similar office or agency anywhere in the world have, to the Seller’s knowledge, been timely and duly filed and duly maintained and prosecuted (including the payment of maintenance and related fees);

                                                                 (iv)to the extent that the Seller Intellectual Property Assets have been developed or created by an independent contractor, consultant, or other third party for the Seller, Seller has a written contract with such third party with respect thereto and the Seller thereby either (A) has obtained by operation of Law or by valid assignment ownership of and is the exclusive owner of, or (B) has obtained a license (sufficient for the operations of the Seller as currently conducted) to, such third party’s interest in such Seller Intellectual Property Assets.

                                                                 (v)as of the date hereof, there are no pending or, to the knowledge of Seller, threatened claims, proceedings or actions against Seller or a Subsidiary of Seller (A) alleging that the operation of Seller’s Business infringes or misappropriates any Intellectual Property Assets owned by a third party (“Third Party Rights”) or (B) that otherwise challenge the right of Seller or a Subsidiary of Seller to conduct Seller’s Business in the manner conducted as of the date hereof or the ownership of or right to use the Seller Intellectual Property Assets.  As of the date hereof, no interference, opposition, reissue, or reexamination is pending or, to Seller’s knowledge, threatened, in which the scope, validity, or enforceability of any of the Seller Intellectual Property Assets is being contested or challenged.  None of the Seller Intellectual Property Assets is subject to any outstanding judgment, decree, order, writ, award, injunction or determination of an arbitrator or court affecting the rights of Seller or any Subsidiary of Seller with respect thereto;

                                                                 (vi)(A) the operation of Seller’s Business does not infringe upon or violate any Third Party Rights other than Patents; and (B) to the knowledge of Seller, the operation of Seller’s Business does not infringe upon any Patents owned by a third party;

                                                                 (vii)to the knowledge of Seller, there is no, and has been no, infringement upon or violation by any Person of any of the Seller Intellectual Property Assets;

                                                                 (viii)Each of Seller and a Subsidiary of Seller, as the case may be, have entered into written confidentiality and nondisclosure agreements with all employees, independent contractors and agents of Seller or a Subsidiary of Seller who have been engaged to work on Seller Products to protect the confidentiality of all Trade Secrets owned by Seller or a Subsidiary of Seller and used by Seller or a Subsidiary of Seller in the operation of Seller’s Business (the “Seller Trade Secrets”) and to protect the confidentiality of all confidential information of Seller’s and a Subsidiary of Seller’s customers or other third parties possessed or used by Seller and a Subsidiary of Seller in the operation of Seller’s Business.  Without limiting the foregoing, to the knowledge of Seller, no such employee or independent contractor of Seller or a Subsidiary of Seller is in default or breach of any term of any employment agreement, nondisclosure agreement, assignment of invention agreement or similar agreement or contract relating in any way to the protection, ownership, development, use or transfer of the Seller Intellectual Property Assets; a nd

                                                                 (ix)to Seller’s knowledge, no funding, facilities, or personnel of any governmental entity or educational institution were used, directly or indirectly, to develop or create, in whole or in part, any of the Seller Intellectual Property Assets.

(c)For purposes of this Agreement:

 (i)“Intellectual Property Assets” means:

(A)   All patents and patent applications of any kind (and any patents that issue as a result of those patent applications), and any renewals, reissues, reexaminations, extensions, continuations, continuations-in-part, divisions and substitutions relating to any of the patents and patent applications, as well as all foreign counterparts to such patents and patent applications (collectively, “Patents”);

(B)   All registered and unregistered trademarks, service marks, trade names, trade dress, logos, slogans, corporate names, Internet domain names, and the goodwill associated therewith, together with any registrations and applications for registration thereof  (collectively, “Marks”);

(C)   All copyrights whether registered or unregistered, in both published and unpublished works, including, without limitation, all computer programs, manuals and other documentation and any and all registrations and applications for registration thereof (collectively, “Copyrights”); and

(D)   All trade secret rights, under applicable Law, including, without limitation, U.S. state trade secret Laws, in (1) know-how, (2) inventions (whether or not patentable) and improvements thereto (including as disclosed in invention disclosures and discoveries) and (3) confidential or proprietary information  (collectively, “Trade Secrets”).

 (ii)“Seller’s Business” means the business of Seller and a Subsidiary of Seller as currently conducted by Seller and a Subsidiary of Seller.

                                                                (iii)“Seller Intellectual Property Assets” means all Intellectual Property Assets owned by Seller or a Subsidiary of Seller and includes, without limitation, S eller Patents, Seller Marks, Seller Copyrights and Seller Trade Secrets.

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5.20Insurance.

Schedule 5.20 of the Seller Disclosure Schedule lists each of the insurance policies of Seller and each Subsidiary of Seller currently in effect (the “Insurance Policies”).  All such Insurance Policies are in full force and effect, all premiums due and payable thereunder have been paid, neither Seller nor any Subsidiary of Seller is in material default thereunder, and neither Seller nor any Subsidiary of Seller has taken any action or failed to take any action which, with notice or the lapse of time, would constitute such a breach or default of thereunder or permit termination or material modification thereof.  Except as set forth in Section 5.20 of the Seller Disclosure Schedule, neither Seller nor any Subsidiary of Seller h as received any written notice of cancellation or termination with respect to any such Insurance Policy of Seller or any Subsidiary of Seller.

5.21Opinion of Financial Advisor.

The Seller Board has received the opinion of Seller’s Financial Advisor, to the effect that, subject to the assumptions, qualifications and other matters set forth therein, as of the date of such opinion, the consideration to be received pursuant to this Agreement, including the Offer Price, by the Seller Stockholders (other than Parent, Purchaser and their respective Affiliates) is fair, from a financial point of view, to such holders, and as of the date of this Agreement, such opinion has not been modified or withdrawn and a copy of which has been made available to Parent.

5.22Schedule 14D-9; Proxy Statement; Seller Information.

(a)Seller represents that the Schedule 14D-9 will comply in all material respects with the provisions of applicable federal securities Laws and, on the date filed with the SEC and on the date first published, sent or given to the Seller Stockholders, shall not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading, except that no representation is made by Seller with respect to information supplied by Parent or Purchaser in writing for inclusion in the Schedule 14D-9.

(b)The information relating to Seller and each Subsidiary of Seller to be contained in the Proxy Statement (if any), and any other documents filed with the SEC in connection herewith, will not, on the date the Proxy Statement is first mailed to the Seller Stockholders at the time of the Special Meeting, contain any untrue statement of a material fact, or omit to state any material fact required to be stated therein or necessary in order to make the statements therein not false or misleading at the time and in light of the circumstances under which such statement is made.  The Proxy Statement will comply in all material respects as to form with the requirements of the Exchange Act and the rules and regulations thereunder.

5.23Certain Compensation Arrangements.

The Seller Board has determined that each of the members of the Seller Compensation Committee are, and Seller represents and warrants that each of the members of the Seller Compensation Committee are and at the Acceptance Date will be, “independent directors” as defined in NASDAQ Marketplace Rule 5605(a)(2) and eligible to serve on the Seller Compensation Committee under the Exchange Act and the rules and regulations thereunder and all applicable NASDAQ Marketplace Rules.  On or prior to the date hereof, the Seller Compensation Committee approved each Seller Compensation Arrangement as an “employment compensation, severance or other employee benefit arrangement” within the meaning of Rule 14d-10(d)(1) under the Exchang e Act (an “Approved Seller Compensation Arrangement”), and has taken all other action necessary to satisfy the requirements of the non-exclusive safe-harbor with respect to such Seller Compensation Arrangements in accordance to Rule 14d-10(d)(2) under the Exchange Act.  Seller has provided copies of all resolutions adopted or actions taken in connection with all Approved Seller Compensation Arrangements.  Each Approved Seller Compensation Arrangement in existence as of the date hereof is listed on Section 5.23 of the Seller Disclosure Schedule.  As used in this Agreement, “Seller Compensation Arrangement” means (i) any employment agreement, severance agreement or change-in-control agreement between Seller or a Subsidiary of Seller, on the one hand, and any officer, director or other stockholder of Seller or a Subsidiary of Seller, on the other hand, and any severance or change-in-control arrangement or policy maintained by Seller, and any amendm ents thereto entered into during the 12 months immediately prior to the date hereof and (ii) any Seller Stock Options, Seller Restricted Stock Awards and Seller Restricted Stock Units.

5.24Customers; Distributors and Vendors.

 Section 5.24 of the Seller Disclosure Schedule sets forth the top ten customers and suppliers of Seller (based on the aggregate dollar amounts purchased by such customers) for previous twelve (12) calendar month period prior to the date of this Agreement (“Material Customers and Suppliers”). Except as set forth on Section 5.24 of the Seller Disclosure Schedule, Seller has not, since the date of the Seller Balance Sheet, received written notice from any of its Material Customers and Suppliers indicating that there has been a material adverse change in the relationship between Seller and such customer or supplier. Since the date of the Seller Balance Sheet, no agreement between Sell er and any of its Material Customers and Suppliers has been terminated other than as a result of the completion of the work contemplated to be performed under such contract or the expiration of the term of any such agreement.  There is no existing breach or default on the part of the Seller of its exclusivity restrictions or obligations under any agreement with any Material Customers and Suppliers except to the extent described in Section 5.24 of the Seller Disclosure Schedule.

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ARTICLE VI

COVENANTS RELATING TO CONDUCT OF BUSINESS

6.1Conduct of Business Pending the Effective Time.

At all times from the execution of this Agreement until the Effective Time, except as set forth in Section 6.1 of the Seller Disclosure Schedule or as expressly permitted or required elsewhere in this Agreement, Seller shall, and shall cause each Subsidiary of Seller to, conduct its business in the ordinary course consistent with past practice and in compliance in all material respects with all applicable Laws (including the rules of NASDAQ, excluding any stockholder voting requirements contained therein) and accounting standards (including GAAP), and use commercially reasonable efforts in light of its available cash to, preserve substantially intact its business organizations and goodwill, keep available the services of its officers and employees and preserve t he relationships with those Persons having business dealings with Seller or any Subsidiary of Seller.  Furthermore, except as set forth in Section 6.1 of the Seller Disclosure Schedule or as expressly permitted elsewhere in this Agreement, Seller agrees not to take any of the following actions (and to cause each Subsidiary of Seller not to take such actions) without the prior written consent of Parent (which will not be unreasonably withheld):

(a)amend its articles of organization, certificate of incorporation or bylaws, joint venture documents, partnership agreements or equivalent organizational documents;

(b)(i) issue, deliver, sell, pledge, transfer, dispose of or encumber any shares of capital stock or other equity or voting interests of Seller or each Subsidiary of Seller or any securities convertible into, exchangeable or exercisable for or representing the right to subscribe for, purchase or otherwise receive any such shares or interests or any stock appreciation rights, “phantom” stock rights, performance units, rights to receive shares of capital stock or other rights that are linked to the value of Seller Common Stock or the value of Seller or each Subsidiary of Seller or any part thereof, provided, however that none of the foregoing shall prohibit the issuance of Seller Common Stock (and the issuance of associated Seller Rights) upon the exercise of Seller Stock Options, the vesting of Seller Restricted Stock Units, issuances under the ESPP or the exercise of Seller Warrants (and in each case the issuance of associated Seller Rights), in each case as set forth in Section 5.2(b), or (ii) effect any stock split, stock combination, stock reclassification, reverse stock split, stock dividend, recapitalization or other similar transaction;

(c)grant, confer or award any option, right, warrant, deferred stock unit, conversion right or other right not existing on the date hereof to acquire any of its shares of capital stock or shares of deferred stock, restricted stock awards, restricted stock units, stock appreciation rights, “phantom” stock awards or other similar rights that are linked to the value of Seller Common Stock or the value of Seller or each Subsidiary of Seller or any part thereof (whether or not pursuant to existing Seller Stock Plans);

(d)(i) except to the extent required under existing plans or arrangements set forth in Section 5.13(a) of the Seller Disclosure Schedule, increase any compensation or benefit (other than in the ordinary course of business consistent with past practice to non-Key Employees) of, or enter into or amend in any material respect any employment or severance agreement with (or pay any amounts (other than in the ordinary course of business consistent with past practice to non-Key Employees) under any Seller Benefi t Plans or Seller Other Plans not otherwise due to) any Seller Personnel, (ii) grant any bonuses, other than in the ordinary course of business consistent with past practice (including grants of bonuses to new hires), to any Seller Personnel, (iii) adopt any new Seller Pension Plan, Seller Benefit Plan or Seller Other Plan (including any stock option, stock benefit or stock purchase plan) or amend or modify any existing Seller Pension Plan, Seller Benefit Plan or Seller Other Plan in any material respect, or accelerate the vesting of any compensation (including equity-based awards) for the benefit of any Seller Personnel or grant or amend in any material respect any award under any Seller Pension Plan, Seller Benefit Plan or Seller Other Plan (including the grant of any equity or equity-based or related compensation), (iv) provide any funding for any rabbi trust or similar arrangement, or take any other action to fund or secure the payment of any compensation or benefit, (v) grant to any Seller Per sonnel any right to receive any severance, change-in-control, retention, termination or similar compensation or benefits or increases therein (other than, in the case of any non-Key Employee, the payment of cash severance or the provision of continued welfare benefits in the ordinary course of business consistent with past practice), (vi) hire or otherwise employ any individual other than in the ordinary course of business consistent with past practice or (vii) terminate any Key Employee other than for cause (including misconduct or breach of company policy);

(e)(i) declare, set aside or pay any dividend or make any other distribution or payment (whether in cash, stock or other property or any combination thereof) with respect to any shares of its capital stock or other equity or voting interests (other than dividends or distributions from a wholly-owned Subsidiary of Seller to another Subsidiary of Seller or to Seller) or (ii) directly or indirectly redeem, purchase or otherwise acquire any of its shares of capital stock of, or other equity or voting interest in, any of Seller or each Subsidiary of Seller, or any options, warrants, calls or rights to acquire any such stock or other securities, other than i n connection with Tax withholdings and exercise price settlement upon the exercise of Seller Stock Options, the vesting of Seller Restricted Stock Units or Seller Restricted Stock Awards or the exercise of Seller Warrants, in each case outstanding on the date of this Agreement;

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(f)(i) transfer, sell, lease, sublease, license, sublicense or otherwise dispose of any material assets or properties of Seller or any Subsidiary of Seller or (ii) mortgage or pledge any of the property or assets of Seller or any Subsidiary of Seller, or subject any such property or assets to any other Encumbrance (except Permitted Encumbrances), other than, in the case of both (i) and (ii), in the ordinary course of business consistent with past practice;

(g)except in the ordinary course of business consistent with past practice, enter into, or amend or terminate any Seller Contract or any lease or sublease (excluding contracts with respect to capital expenditures, which are governed by clause (h) below); provided that in no event shall Seller enter into any procurement contracts which require or involve the payment by Seller or any Subsidiary of Seller of more than $250,000 individually or $1,000,000 in the aggregate;

(h)make any capital expenditures in excess of $250,000 individually or $1,000,000 in the aggregate;

(i)(A) merge with, enter into a consolidation with or otherwise acquire a material portion of the outstanding equity interests in any Person or acquire any portion of the assets or business of any Person (or any division or line of business thereof) or (B) otherwise acquire (including, through leases, subleases and licenses of real property) any assets, except in the ordinary course of business consistent with past practice; provided that no acquisitions that make it more difficult in any material respect to obtain any approval or authorization required in connection with the transactions cont emplated hereby under any Law or that would reasonably be expected to prevent, delay, or impede consummation of the transactions contemplated hereby shall be permitted without consent;

(j)write down or write up or fail to write down or write up the value of any receivables or revalue any assets of Seller other than in the ordinary course of business and in accordance with GAAP;

(k)create, incur or assume any indebtedness for borrowed money, assume, guarantee, endorse or otherwise become liable or responsible (whether, directly, contingently or otherwise) for the indebtedness of another Person, enter into any agreement to maintain any financial statement condition of another Person or enter into any arrangement or amend or modify any existing arrangement having the economic effect of any of the foregoing, except for (i) letters of credit or replacement letters of credit entered into in the ordinary course of business and consistent with past practice; (ii) any indebtedness owed to Seller by any of its direct or indirect wholly-owne d Subsidiaries; or (iii) purchase money debt, capital leases or guarantees in the ordinary course of business not involving indebtedness of more than $1,000,000 individually or $2,500,000 in the aggregate;

(l)change any of its methods, principles or practices of financial accounting currently in effect other than as required by GAAP as concurred by its independent registered accountants;

(m)(i) modify or amend in a manner that is adverse in a material respect to Seller or any Subsidiary of Seller, or accelerate, terminate or cancel, any Seller Contract, (ii) enter into, amend or modify any agreement or arrangement with Persons that are Affiliates, or (iii) enter into, extend or renew any contract which, if executed prior to the date of this Agreement, would have been required to be disclosed pursuant to Section 5.15, other than, in each case, in the ordinary c ourse of business consistent with past practice;

(n)transfer or license on an exclusive basis to any Person any rights to Seller Intellectual Property Assets;

(o)authorize, recommend, propose or announce an intention to adopt a plan of complete or partial liquidation or dissolution of Seller or any Subsidiary of Seller;

(p)form any Subsidiary;

(q)settle, pay or discharge any litigation, investigation, or arbitration, other than the settlement, payment, discharge or satisfaction (i) in the ordinary course of business consistent with past practice or (ii) of any actions, suits, claims, investigations or proceedings instituted or threatened against Seller or any of its directors, officers or Affiliates, including by any Seller Stockholder, before any court or Governmental Authority relating to this Agreement, the Support Agreements, the Merger or the other transactions contemplated hereby, or seeking damages or discovery in connection with this Agreement, the Support Agreements, the Merger or the ot her transactions contemplated hereby;

(r)knowingly take or fail to take any action in breach of this Agreement for the purpose of (or which would be reasonably expected to) materially delaying or preventing the consummation of the transactions contemplated hereby (other than as required by Law); and

(s)authorize any of, or commit, resolve, offer or agree to take any of, the foregoing actions or any other action inconsistent with the foregoing.

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ARTICLE VII

ADDITIONAL AGREEMENTS

7.1Third Party Consents and Regulatory Approvals.

(a)Each of Parent and Purchaser, on the one hand, and Seller, on the other hand, agrees promptly to correct any information provided by it for use in the Offer Documents or in the Schedule 14D-9 if and to the extent that such information shall have become false or misleading in any material respect and each of Parent, Purchaser and Seller further agrees to take all steps necessary to cause, respectively, the Offer Documents or the Schedule 14D-9 as so corrected to be filed with the SEC and to be disseminated to the Seller Stockholders, in each case, as and to the extent required by applicable federal securities Laws.

(b)Subject to the terms and conditions of this Agreement, each of Parent, Purchaser and Seller will use its commercially reasonable efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things necessary, proper or advisable under this Agreement and applicable Laws and regulations to consummate the transactions contemplated by this Agreement (including, without limitation, each of the Offer and the Merger) as soon as practicable after the date hereof, including (i) preparing and filing, in consultation with the other party and as promptly as practicable and advisable after the date hereof, all documentation to effect all necessary applications, notices, petitions, filings, Tax ruling requests and other documents and to obtain as promptly as practicable all consents, clearances, waivers, licenses, orders, registrations, approvals, permits, Tax rulings and authorizations necessary to be obtained from any third party and/or any Governmental Authority in order to consummate the Offer, the Merger or any of the other transactions contemplated by this Agreement and (ii) taking all reasonable steps as may be necessary to obtain all such material consents, clearances, waivers, licenses, registrations, permits, authorizations, Tax rulings, orders and approvals.  In furtherance and not in limitation of the foregoing, each party hereto agrees to make or cause to be made, in consultation and cooperation with the other and as promptly as practicable and advisable after the date hereof, (i) any necessary filing of a Notification and Report Form pursuant to the HSR Act and (ii) all other necessary registrations, de clarations, notices and filings relating to the Offer or Merger with other Governmental Authorities under any other antitrust, competition, trade regulation or other Regulatory Law with respect to the transactions contemplated hereby and to respond to any inquiries received and supply as promptly as practicable any additional information and documentary material that may be requested pursuant to the HSR Act and any other Regulatory Law and to take all other actions reasonably necessary to cause the expiration or termination of the applicable waiting periods under the HSR Act and any other Regulatory Law as soon as practicable and not extend any waiting period under the HSR Act or any other Regulatory Law or enter into any agreement with a Governmental Authority not to consummate the transactions contemplated by this Agreement, without prior consultation  and the written consent of Parent, which consent shall not be unreasonably withheld or delayed.  If necessary to obtain any regulatory a pproval pursuant to any Regulatory Law, or if any administrative or judicial Action, including any Action by a Governmental Authority or a private party, is instituted (or threatened to be instituted), challenging the Offer, the Merger or any other transaction contemplated by this Agreement as violative of any Regulatory Law, each of Parent, Purchaser and Seller shall cooperate with each other and use its commercially reasonable efforts to (x) obtain any regulatory approval, (y) contest and resist any such Action, or (z) avoid the entry of or have vacated or terminated, lifted, reversed or overturned any decree, judgment, injunction, or other order (whether temporary, preliminary or permanent) that would restrain, prevent or delay the Closing or the other transactions contemplated herein.

(c)To the extent permissible under applicable Law, each of Parent, Purchaser and Seller shall, in connection with the efforts referenced in Section 7.1(b) to obtain all requisite approvals, clearances and authorizations for the transactions contemplated by this Agreement under the HSR Act or any other Regulatory Law, use its commercially reasonable efforts to (i) cooperate in all respects with each other in connection with any filing or submission and in connection with any investigation or other inquiry, including any proceeding initiated by a private party, (ii) promptly infor m the other party of any communication received by such party from, or given by such party to, the Antitrust Division of the Department of Justice (the “DOJ”), the Federal Trade Commission (the “FTC”) or any other Governmental Authority and of any material communication received or given in connection with any proceeding by a private party, in each case regarding any of the transactions contemplated hereby, (iii) permit the other party, or the other party’s legal counsel, to review any communication given by it to, and consult with each other in advance of any meeting or conference with, the DOJ, the FTC or any such other Governmental Authority or, in connection with any proceeding by a private party, with any other Person, (iv) give the other party the opportunity to attend and participate in such meetings and conferences to the extent allo wed by applicable Law or by the applicable Governmental Authority, (v) in the event one party is prohibited by applicable Law or by the applicable Governmental Authority from participating in or attending any meetings or conferences, keep the other promptly and reasonably apprised with respect thereto and (vi) cooperate in the filing of any memoranda, white papers, filings, correspondence, or other written communications explaining or defending the transactions contemplated hereby, articulating any regulatory or competitive argument, and/or responding to requests or objections made by any Governmental Authority.

(d)Notwithstanding anything to the contrary in this Agreement, neither Parent nor Purchaser shall have an obligation under this Agreement: (i) to divest or agree to divest (or cause any of its subsidiaries) anything material to any of its or their respective material businesses, material product lines or material assets, or to take or agree to take (or cause any of its subsidiaries to take or agree to take) any other action or to agree (or cause any of its subsidiaries to agree) to any material limitation or material restriction on any of its or their respective businesses, product lines or assets; or (ii) to defend against any litigation brought by any Gov ernmental Authority relating to the transactions contemplated by this Agreement.  Notwithstanding anything to the contrary contained in this Section 7.1(d), the Parties reserve the right to limit disclosure of documents, or portions thereof, submitted to any Governmental Authority to outside competition counsel only.

(e)Notwithstanding anything in this Agreement to the contrary, Seller shall not, without the consent of Parent, publicly or before any Governmental Authority or other third party, offer, suggest, propose or negotiate, and shall not commit to or effect, by consent decree, hold separate order or otherwise, any sale, divestiture, disposition, prohibition or limitation or other action of a type described in Section 7.1(e).

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7.2No Solicitation.

(a)Upon execution of this Agreement, Seller shall and shall cause its Subsidiaries and its and their respective Representatives to cease immediately and cause to be terminated any and all existing activities, discussions or negotiations with any Person conducted heretofore with respect to, or that may reasonably be expected to lead to, an Acquisition Proposal.  Seller shall promptly after the execution of this Agreement instruct each Person which has heretofore executed a confidentiality agreement relating to an Acquisition Proposal with or for the benefit of Seller to promptly return or destroy all information, documents, and materials relating to the Acquisition Proposal or to Seller or its businesses, operations or affairs heretofore furnished by Seller or any of its Representatives to such Person or any of its Representatives in accordance with the terms of any confidentiality agreement with such Person.

(b)Except as authorized or permitted in this Section 7.2, Seller agrees that neither it nor any of its Subsidiaries shall, and that it shall cause its and their respective Representatives not to, directly or indirectly, (i) initiate, solicit, or knowingly encourage or knowingly facilitate the submission of any inquiry, indication of interest, proposal or o ffer that constitutes, or would reasonably be expected to lead to, an Acquisition Proposal, (ii) participate in any discussions or negotiations regarding, or furnish any non-public information to any Person (other than Parent or Purchaser) in connection with, an Acquisition Proposal, (iii) enter into any letter of intent or agreement related to an Acquisition Proposal (other than a confidentiality agreement as contemplated by Section 7.2(c)), or (iv) approve or recommend an Acquisition Proposal.

(c)Notwithstanding Section 7.2(b), from the date hereof and prior to the Acceptance Date, if Seller or its Representatives receive an unsolicited bona fide written Acquisition Proposal which did not result from a breach of this Section 7.2, and the Seller Board determines in good faith, after consultation with outside legal counsel and financial advisors, that (i) such Acquisition Proposal constitutes, or is reasonably like ly to lead to, a Superior Proposal, and (ii) the failure to so respond to such Acquisition Proposal would reasonably be likely to result in a breach of its fiduciary duties to the Seller Stockholders under applicable Law, Seller may take the following actions: (a) furnish information to the third party making such Acquisition Proposal (a “Qualified Bidder”), provided Seller receives from the Qualified Bidder an executed confidentiality agreement (the terms of which are no less favorable to Seller than those contained in the Confidentiality Agreements); and (b) engage in discussions or negotiations with the Qualified Bidder and its Representatives with respect to the Acquisition Proposal; provided, that the Seller shall concurrently provide or make available to Parent any information concerning the Seller or its Subsidiaries provided to such third party which was n ot previously provided to Parent. Without limiting the generality of the foregoing, it is understood that any violation of the restrictions set forth in this Section 7.2(c) by any Representatives of the Seller shall be deemed to be a breach by the Seller of this Section 7.2(c).

(d)Except as otherwise provided in Section 7.2(e), neither the Seller Board nor any committee of the Seller Board may (i) withhold, withdraw, change, qualify, or modify in any manner adverse to Parent or Purchaser the Seller Recommendations, or propose publicly to approve, adopt or recommend any Acquisition Proposal, (ii) approve or recommend, or propose publicly to approve or recommend, an Acquisition Proposal, (iii) fail to include the Seller Recommendation in the Schedule 14D-9, or (iv) approve or recomme nd, or propose publicly to approve, recommend or permit the Seller to enter into, any written letter of intent, memorandum of understanding or other agreement (each, an “Acquisition Agreement”) constituting any Acquisition Proposal (other than a confidentiality agreement in accordance with Section 7.2(c)) (any of the foregoing, an “Adverse Recommendation Change”).

(e)Notwithstanding Section 7.2(d), at any time prior to the Acceptance Date, the Seller Board may in response to a Superior Proposal that did not result from a breach by Seller of this Section 7.2, (i) effect an Adverse Recommendation Change, and/or (ii) enter into a definitive agreement with respect to such Superior Proposal (an “Acquisition Agreement”) and simultaneo usly terminate this Agreement in accordance with Section 9.1(d)(ii) if the Seller Board determines in good faith, after consultation with Seller’s outside legal counsel, that failure to do so would reasonably be likely to result in a breach of its fiduciary obligations under applicable Law; provided, however, that such actions may only be taken at a time that is (A) after the third (3rd) Business Day following Parent’s receipt of written notice from Seller that the Seller Board is prepared to take such action (the “Subsequent Determination Notice” and such period, the “Notice Period”), which notice will specify the material terms of the applicable Acquis ition Proposal and identify the Person making such Superior Proposal (it being understood and agreed that any material amendment to such Superior Proposal, including the financial terms of such Superior Proposal, shall require the delivery of a new Subsequent Determination Notice and the commencement of a new three (3) Business-Day period), and (B) at the end of such period, the Seller Board determines in good faith, after taking into account all amendments or revisions irrevocably committed to by Parent and after consultation with outside legal counsel and financial advisors, that such Acquisition Proposal remains a Superior Proposal.  During any such three (3) Business-Day period, Parent shall be entitled to deliver to Seller one or more counterproposals to such Acquisition Proposal, and Seller shall give Parent the opportunity to meet and negotiate with Seller and its Representatives.  If Parent has proposed to Seller revisions to the terms of the transactions contemplated by this Agre ement during the Notice Period prior to Seller effecting an Adverse Recommendation Change or terminating this Agreement pursuant to this Section 7.2, Seller agrees that Seller and its Representatives shall, during the Notice Period and if requested by Parent in writing, negotiate in good faith with Parent and its Representatives (so long as Parent and its Representatives are negotiating in good faith) regarding any such revisions to the terms of the transactions contemplated by this Agreement proposed by Parent.

(f)In addition, and notwithstanding the foregoing, at any time prior to the Acceptance Date, the Seller Board may, in response to an Intervening Event, effect an Adverse Recommendation Change if, and only if, the Seller Board has concluded in good faith, after consultation with its outside counsel, that it is necessary to take such action in order to comply with its fiduciary obligations under applicable Law; provided that, the Seller Board shall not be entitled to take such action pursuant to this sentence unless Seller has (x) provided to Parent at least three (3) Business Days’ prior written notice advising Parent that the Seller Board intends to take such action and describing such Intervening Event in reasonable detail and (y) during such three Business Day period, if requested by Parent, engaged in good faith negotiations with Parent to amend this Agreement in such a manner that obviates the need for taking such action as a result of the Intervening Event. Any Adverse Recommendation Change shall not change the approval of this Agreement or any other approval of the Seller Board, nor shall any Adverse Recommendation Change have the effect of causing any state (including Delaware) corporate takeover statute or other similar statute to be applicable to the transactions contemplated hereby or thereby, including the Offer and the Merger.

(g)From and after the execution of this Agreement, Seller shall notify Parent promptly (but in any event within twenty-four (24) hours) of the receipt of any inquiries, discussions, negotiations, proposals or expressions of interest with respect to an Acquisition Proposal (including a summary of the material terms and conditions thereof).  The Seller shall (i) keep Parent reasonably informed of the status (including any material change to the financial terms, conditions, or other material terms) of any such inquiries, discussions, negotiations, proposals or expr essions of interest with respect to an Acquisition Proposal, on a reasonably current basis (and otherwise no later than 24 hours after the occurrence of any material change, development, discussion or negotiations) and (ii) provide to Parent, as soon as practicable and in any event within 24 hours after receipt or delivery thereof, copies of all draft agreements (and any other written material to the extent such material contains any financial terms, conditions or other material terms relating to any Acquisition Proposal or, where no such written materials are available, a summary of the material terms and conditions thereof).  The Seller shall not, and shall cause its Subsidiaries not to, enter into any agreement with any Person subsequent to the date of this Agreement, and neither the Seller nor any of its Subsidiaries is party to any agreement, in each case that prohibits the Seller from providing such information to Parent.

(h)Nothing in this Section 7.2 shall be deemed to prohibit Seller from complying with Rule 14e-2 or Item 1012(a) of Regulation M-A promulgated under the Exchange Act with regard to an Acquisition Proposal if, in the good faith judgment of the Seller Board or a committee of the Seller Board, after consultation with its outside legal counsel, failing to take such action would be inconsistent with its obligations under applicable Law (it being understood that any such compliance with Rule 14e-2 or Item 101 2(a) may constitute an Adverse Recommendation Change).  In addition, it is understood and agreed that, for purposes of this Agreement, a factually accurate public statement by Seller that describes Seller's receipt of an Acquisition Proposal and the operation of this Agreement with respect thereto, or any “stop, look and listen” communication by the Seller Board pursuant to Rule 14d-9(f) of the Exchange Act or any similar communication to the stockholders of Seller, shall not constitute an Adverse Recommendation Change or an approval or recommendation with respect to any Acquisition Proposal.

(i)For purposes of this Agreement, “Superior Proposal” shall mean any written bona fide Acquisition Proposal (with all references to 15% in the definition of Acquisition Proposal being treated as references to 50% for these purposes) made by a third party that the Seller Board determines in good faith, after consultation with outside legal counsel and financial advisors, (i) is reasonably capable of being consummated on the terms proposed w ithout unreasonable delay, and (ii) if consummated would provide greater value from a financial point of view to all of the Seller Stockholders than the consideration payable in the Offer and the Merger (taking into account all financial, regulatory, legal and other terms and conditions of such proposal and this Agreement (including any changes to the terms of the Offer or this Agreement proposed by Parent in response to such Superior Proposal or otherwise)).

(j)For purposes of this Agreement, “Acquisition Proposal” means any inquiry, indication of interest, proposal or offer for any transaction or series of related transactions, whether or not in writing, involving (i) a merger, tender offer, recapitalization, reorganization, liquidation, dissolution, business combination or consolidation, or any similar transaction, involving Seller, (ii) a sale, lease, license, exchange, mortgage, pledge, transfer or other acquisition of assets that constitute at l east 15% of the assets of Seller and its Subsidiaries, taken as a whole, (iii) a purchase, tender offer or other acquisition (including by way of merger, consolidation, stock exchange or otherwise) of beneficial ownership (the term “beneficial ownership” for purposes of this Agreement having the meaning assigned thereto in Section 13(d) of the Exchange Act and the rules and regulations thereunder) of securities representing 15% or more of the voting power of Seller or any of its Subsidiaries, or (iv) any combination of the foregoing; provided, however, that the term “Acquisition Proposal” shall not include the Offer and the Merger or the other transactions contemplated by this Agreement.

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7.3Access to Information.

(a)Upon reasonable prior notice and subject to applicable Laws relating to the exchange of information, Seller shall, and shall cause each of its Subsidiaries to, afford to the officers, employees, accountants, counsel and other Representatives of Parent, reasonable access without undue interruption, during normal business hours during the period from the date of this Agreement until the Effective Time, or the date, if any, on which this Agreement is terminated pursuant to Section 9.1< /a>, to all of its properties, books, contracts, commitments and records (other than confidential information contained in personnel files to the extent the disclosure of such information is prohibited by privacy Laws), and their accountants and accountants’ work papers.  Seller also shall provide Parent with such access to the appropriate individuals (including management personnel, attorneys, accountants and other professionals) for discussion of Seller’s business, properties, prospects and personnel as Parent or Purchaser may reasonably request.  Neither Seller nor any of its Subsidiaries shall be required to provide access to or to disclose information where such access or disclosure would contravene any law, rule, regulation, order, judgment, decree, or binding agreement entered into prior to the date of this Agreement or would reasonably be expected to violate or result in a loss or impairment of any attorney-client or work product privilege.  The parties heret o will use commercially reasonable efforts to make appropriate substitute disclosure arrangements under circumstances in which the restrictions of the preceding sentence apply.  In furtherance of the foregoing, no information identifying individual employees or consultants of Seller or any Subsidiary of Seller or protected personal information regarding such employees or consultants will be disclosed under this Agreement (including in the Seller Disclosure Schedule) in respect of employees or consultants that are employed (or were employed and remain domiciled) in any country that has enacted legislation implementing the EU Personal Data Privacy Directive or similar legislation, except to the extent permitted by a contractual undertaking entered into by Seller and Parent regarding maintenance of privacy of such data in a form reasonably necessary to effect compliance with such legislation.

(b)With respect to all information furnished by one party to the other party or its Representatives under this Agreement, the parties shall comply with, and shall cause their respective Representatives to comply with, all of their respective obligations under the Confidentiality Agreements.

7.4Employment and Benefit Matters.

(a)For the period commencing at the Effective Time and ending on December 31, 2011, Parent agrees to cause the Surviving Corporation to maintain base salary, bonus opportunity, retirement benefits, health benefits, welfare benefits, but not any stock-based benefits, for the Seller Personnel who remain employed after the Effective Time (collectively, the “Seller Employees”) at the same levels that are, in the aggregate, at least comparable to those in effect for similarly situated employees of Parent on the date hereof.  Parent shall, and shall cause the Surviving Corporat ion to, treat, and cause the applicable benefit plans in which Seller Employees are entitled to participate to treat, the service of Seller Employees with Seller or any Subsidiary of Seller attributable to any period before the Effective Time as service rendered to Parent, the Surviving Corporation or any Subsidiary of Parent for purposes of eligibility to participate, vesting and for other appropriate benefits including, but not limited to, applicability of minimum waiting periods for participation, but excluding benefit accrual (including minimum pension amount) and eligibility for early retirement under any defined benefit plan of Parent or eligibility for retiree welfare benefit plans or as would otherwise result in a duplication of benefits.  Without limiting the foregoing, Parent shall cause any pre-existing conditions or limitations, eligibility waiting periods or required physical examinations under any health or similar plan of Parent to be waived with respect to Seller Employees and their eligible dependents, to the extent waived or satisfied under the corresponding plan in which Seller Employees participated immediately prior to the Acceptance Date, and any deductibles paid by Seller Employees under any of Seller’s or its Subsidiaries’ health plans in the plan year in which the Acceptance Date occurs shall be credited towards deductibles under the health plans of Parent or any Subsidiary of Parent.  Parent shall, and shall cause the Surviving Corporation to, use commercially reasonable efforts to make appropriate arrangements with its insurance carrier(s) to ensure such result.  Seller Employees shall be considered to be employed by Parent “at will” and nothing shall be construed to limit the ability of Parent or the Surviving Corporation to terminate the employment of any such Seller Employee at any time.  Parent will cooperate with Seller, and assume all costs, in respect of consultation obligations and similar notice and bargaining ob ligations owed to any employees or consultants of Seller or any Subsidiary of Seller in accordance with all applicable Laws and bargaining agreements, if any.

(b)Subject to Section 7.4(a) hereof, Parent shall have sole discretion with respect to the determination as to whether or when to terminate, merge or continue any employee benefit plans and programs of Seller; provided, however, that Parent shall continue to maintain such employee benefit plans and programs of Seller (other than stock based plans) until the Seller Employees are permitted to participate in the plans and programs of Parent or the Surviving Corporation in accordance with Section 7.4(a).

(c)Except as otherwise expressly provided in this Agreement, Parent shall, and shall cause the Surviving Corporation to, continue to be obligated to perform, in accordance with their terms, all contractual rights of current and former employees of Seller, or obligations of Seller under any severance or change-in-control policy maintained by Seller, existing as of the date of this Agreement and disclosed in Section 7.4(c) of th e Seller Disclosure Schedule (the “Change-in-Control Arrangements”).  For purposes of the Change-in-Control Arrangements, Parent acknowledges that the occurrence of the Acceptance Date will constitute a “change-in-control” and a “change of control” of Seller.  Without limiting the foregoing, Parent acknowledges and agrees that the executive officers and directors and, as applicable,employeesof Seller shall be entitled to the applicable payments and benefits as set forth in such Change-in-Control Arrangements in accordance with the terms thereof, including as disclosed in Section 7.(c) of Seller Disclosure Schedule, and that such executive officers, directors andemployeesof Seller shall be third party beneficiaries of this Section 7.4(c) and shall be entitled to enforce the covenants contained herein.

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7.5Directors’ and Officers’ Indemnification and Insurance.

(a)Parent and Purchaser agree that any rights to indemnification or exculpation now existing in favor of, and all limitations on the personal liability of each present and former director, officer, employee, fiduciary or agent of Seller and its Subsidiaries (the “Indemnified Parties” and, each, an “Indemnified Party”) provided for in the respective organizational documents and any indemnification agreement between Seller or any Subsidiary of Seller and any present or former director, officer, employee, fid uciary or agent of Seller of any of its Subsidiaries, in effect as of the date hereof shall continue in full force and effect (and with respect to Seller, shall be reflected in the applicable organizational documents of such entity), for a period of six (6) years after the Acceptance Date.  During such period, Parent shall not, nor shall it permit the Surviving Corporation to, amend, repeal or otherwise modify such provisions or agreements for indemnification in any manner that would materially and adversely affect the rights thereunder of any individual who at any time on or prior to the Acceptance Date was a director, officer, employee, fiduciary or agent of Seller or its Subsidiaries in respect of actions or omissions occurring at or prior to the Acceptance Date (including, without limitation, the transactions contemplated by this Agreement), unless such modification is required by Law; provided, however, that in the event any claim or claims are asserted or made either prior to the Acceptance Date or within such six-year period, all rights to indemnification in respect of any such claim or claims shall continue until disposition of any and all such claims.

(b)Prior to the Acceptance Date, Seller shall, to the fullest extent permitted under applicable Laws and regardless of whether the Merger becomes effective, indemnify and hold harmless, and, after the Acceptance Date until the sixth (6th) anniversary of the Acceptance Date, Parent and the Surviving Corporation shall, to the fullest extent permitted under applicable Law, indemnify and hold harmless, each present and former director or officer of Seller and each Subsidiary of Seller (collectively, the “Covered Parties< /font>”) against all costs and expenses (including reasonable attorneys’ fees), judgments, fines, losses, claims, damages, liabilities and settlement amounts paid in connection with any claim, action, suit, proceeding or investigation (whether arising before or after the Acceptance Date), whether civil, administrative or investigative, arising out of or pertaining to any action or omission in their capacities as officers or directors, in each case occurring before the Acceptance Date (including the transactions contemplated by this Agreement).  Without limiting the foregoing, in the event of any such claim, action, suit, proceeding or investigation, (i) Seller or Parent and the Surviving Corporation, as the case may be, shall be entitled to control the defense of such claim, action, suit, proceeding or investigation, (ii) if Seller, Parent or the Surviving Corporation (or counsel selected by the applicable insurer of Seller or the Surviving Corporation) does not elect to control th e defense of such claim, action, suit, proceeding or investigation, the Covered Party shall be entitled to select counsel for the Covered Party, which counsel shall be reasonably satisfactory to Seller or to Parent and the Surviving Corporation, as the case may be, and Seller or Parent and the Surviving Corporation shall pay the fees and expenses of such counsel promptly after statements therefor are received (unless the Surviving Corporation shall elect to defend such action), (iii) the Covered Party shall cooperate in the defense of any such matter, and (iv) none of Seller, Parent or the Surviving Corporation shall be liable for any settlement effected without its written consent (which consent shall not be unreasonably withheld or delayed).

(c)At or prior to the Acceptance Date, Seller shall purchase directors’ and officers’ liability insurance (which by its terms shall survive the Offer and the Merger) for its directors and officers, which shall provide such directors and officers with coverage for six (6) years following the Acceptance Date on terms acceptable to Seller, so long as the aggregate cost of such insurance is less than 300% of the annual premium paid by Seller currently for its existing directors’ and officers’ liability insurance.  Parent shall, and shall cause the Surviving Corporation to, maintain such policy in full force and effect, and cont inue to honor the obligations thereunder.

(d)The obligations under this Section 7.5 shall not be terminated or modified in such a manner as to adversely affect any indemnitee to whom this Section 7.5 applies without the consent of such affected indemnitee (it being expressly agreed that the indemnitees to whom this Section 7.5 applies shall be third party beneficiaries of this Section 7.5 and shall be entitled to enforce the covenants contained herein).

(e)In the event Parent or the Surviving Corporation or any of their respective successors or assigns (i) consolidates with or merges into any other Person and shall not be the continuing or surviving corporation or entity of such consolidation or merger, or (ii) transfers or conveys all or substantially all of its properties and assets, then, and in each such case, to the extent necessary, proper provision shall be made so that the successors and assigns of Parent and the Surviving Corporation, as the case may be, assume the obligations set forth in this Section < font style="DISPLAY: inline; TEXT-DECORATION: underline">7.5.
.

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7.6Additional Agreements.

                In case at any time after the Acceptance Date (including after the Effective Time) any further action is necessary or desirable to carry out the purposes of this Agreement or to vest the Surviving Corporation with full title to all properties, assets, rights, approvals, immunities and franchises of any of the parties to the Merger, the proper officers and directors of each party to this Agreement and their respective Subsidiaries shall take all such necessary action as may be reasonably requested by, and at the sole expense of, Parent.

7.7Advice of Changes.

 Parent and Seller shall each promptly notify the other party of any change or event having a Parent Material Adverse Effect or Seller Material Adverse Effect, as the case may be, or which it believes would otherwise be reasonably likely to cause or constitute a material breach of any of its representations, warranties or covenants contained herein; provided, however, that the delivery of any notice pursuant to this Section 7.7 shall not limit or otherwise affect the remedies available hereunder to the party receiving such notice.

7.8Publicity.

Except with respect to any action taken pursuant to, and in accordance with, Section 7.2 or Article IX, so long as this Agreement is in effect, neither Parent nor Seller shall, or shall permit any of its Subsidiaries to, issue or cause the publication of any press release or other public announcement with respect to, or otherwise make any public statement concerning, the transactions contemplated by this Agreement without the consent of the other party, which consent shall not be unreasonably withheld or delayed, except as may be required by applicable Law or the applicable rules of any stock exchange, in which event such party shall endeavor, on a basis reasonable under the circumstances, to provide a meaningful opportunity to the other parties to review and co mment upon such press release or other announcement and shall give due consideration to all reasonable additions, deletions or changes suggested thereto; provided, however, that the party seeking to issue or cause the publication of any press release or other announcement with respect to the Transaction or this Agreement shall not be required to provide any such review or comment to the other party in connection with any disclosure contemplated by Section 7.2 or any disclosure of Parent or Purchaser in response thereto or in connection therewith.

7.9Rule 16b-3 Actions.

 Parent and Seller agree that, in order to most effectively compensate and retain those officers and directors of Seller who are subject to the reporting requirements of Section 16(a) of the Exchange Act in connection with the Offer and the Merger, both prior to and after the Effective Time, it is desirable that such Persons not be subject to a risk of liability under Section 16(b) of the Exchange Act to the fullest extent permitted by applicable Law in connection with the transactions contemplated by this Agreement, and for that compensatory and retentive purpose agree to the provisions of this Section 7.9.  Promptly after the date hereof and prior to the Expiration Date, Seller shall take all such steps as may be required to cause any dispositio ns of shares of Seller Common Stock resulting from the transactions contemplated by this Agreement by each individual who is subject to the reporting requirements of Section 16(a) of the Exchange Act with respect to Seller to be exempt under Rule 16b-3 promulgated under the Exchange Act, to the extent permitted by applicable Law.

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7.10Rule 14d-10 Matters.

(a)Notwithstanding anything in this Agreement to the contrary, Seller and its Subsidiaries will not, after the date hereof, enter into, establish, amend or modify any plan, program, agreement or arrangement pursuant to which compensation is paid or payable, or pursuant to which benefits are provided, in each case to any Seller Personnel unless, prior to such entry into, establishment, amendment or modification, the Seller Compensation Committee shall have taken all such steps as may be necessary to (i) approve as an Employment Compensation Arrangement each such plan, program, agreement or arrangement and (ii) satisfy the requirements of the non-exclusive sa fe harbor under Rule 14d-10(d)(2) under the Exchange Act with respect to such plan, program, agreement, arrangement, understanding, payment or benefit.

(b) In the event that, during the period beginning on the date of this Agreement and ending not less than five (5) calendar days prior to the Expiration Date, Parent requests that the Seller Compensation Committee consider whether any plan, program, agreement or arrangement that Parent would like to enter into, establish, amend or modify pursuant to which compensation is paid or payable, or pursuant to which benefits are provided, in each case to any Seller Personnel (each such plan, program, agreement or arrangement, a “Post-Signing Arrangement”), would constitute an Employme nt Compensation Arrangement and provides Seller with such information with respect to such Post-Signing Arrangement as Seller may reasonably request, the Seller Compensation Committee will promptly, and in any event prior to the Expiration Date, consider such Post-Signing Arrangement at a meeting duly called and held.  In the event that, following such consideration, the Seller Compensation Committee believes in good faith that such Post-Signing Arrangement constitutes an Employment Compensation Arrangement, at such meeting the Seller Compensation Committee shall take all such steps as may be necessary to (i) approve as an Employment Compensation Arrangement such plan, program, agreement or arrangement and (ii) satisfy the requirements of the non-exclusive safe harbor under Rule 14d-10(d)(2) under the Exchange Act with respect to such plan, program, agreement, arrangement, understanding, payment or benefit.

(c) At the time of any action by the Seller Compensation Committee described in this Section 7.10, each member of the Seller Compensation Committee shall be an “independent director” in accordance with the requirements of Rule 14d-10(d)(2) under the Exchange Act.

7.11State Takeover Laws.

If any “control share acquisition,” “fair price” or other anti-takeover laws or regulations enacted under state or federal laws becomes or is deemed to become applicable to Seller, the Offer, the acquisition of shares of Seller Common Stock pursuant to the Offer, the Top-Up Option, the Merger, the Support Agreements or any other transaction contemplated hereby, then the Seller Board shall take all action necessary to render such statute inapplicable to the foregoing.

7.12Notification of Certain Litigation.

Seller shall notify Parent within twenty-four (24) hours if and after it receives notice of any actions, suits, claims, investigations or proceedings instituted or threatened against Seller or any of its directors, officers or Affiliates, including by any stockholder of Seller, before any court or Governmental Authority relating to this Agreement, the Support Agreements, the Merger or the other transactions contemplated hereby, or seeking damages or discovery in connection with such transactions. Seller shall consult with Parent regarding the defense or settlement of any such actions, suits, claims, investigations or proceedings and shall consider Parent’s views with respect to such actions, suits, claims, investigations or proceedings.< /div>

7.13401(k).

 Except with the prior written consent of Parent, during the period from the date of this Agreement to the Effective Time, Seller shall not (i) make any employer contribution to Seller’s 401(k) plan, other than employer matching contributions at the rate in effect immediately prior to the date of this Agreement, or (ii) make any employer contribution to Seller’s 401(k) plan in the form of Seller Common Stock.  If requested by Parent in writing at least 10 days prior to the initial Expiration Date, Seller shall terminate Seller’s 401(k) plan effective immediately prior to, but contingent upon the occurrence of, the Acceptance Date.

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ARTICLE VIII

CONDITIONS PRECEDENT TO THE

CONSUMMATION OF THE MERGER

8.1Conditions.

The respective obligations of Parent, Purchaser and Seller to consummate the Merger are subject to the satisfaction, at or before the Effective Time, of each of the following conditions:

(a)Seller Stockholder Approval.  Seller Stockholder Approval shall have been obtained, if and to the extent required by applicable Laws.

(b)Purchase of Common Shares.  Purchaser shall have accepted for payment, or caused to be accepted for payment, shares of Seller Common Stock validly tendered and not withdrawn pursuant to the Offer in accordance with the terms hereof and thereof.

(c)Other Approvals.  All regulatory approvals required to consummate the transactions contemplated hereby, shall have been obtained and shall remain in full force and effect and all statutory waiting periods applicable to the Merger shall have expired or been terminated.

(d)No Injunctions or Restraints; Illegality.  No order, injunction, judgment, ruling or decree issued by any court or agency of competent jurisdiction or any Governmental Authority or other legal restraint or prohibition preventing the consummation of the Merger shall be in effect.  No statute, rule, regulation, order, injunction or decree shall have been enacted, entered, promulgated, deemed applicable to the Merger or enforced by any Governmental Authority which prohibits, or makes illegal, consummation of the Merger.

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ARTICLE IX                                

TERMINATION, AMENDMENT AND WAIVER

9.1Termination.

This Agreement may be terminated and the Transaction may be abandoned at any time prior to the Effective Time, whether before or after the Seller Stockholder Approval:

(a)by mutual written consent of Seller and Parent duly authorized by the Seller Board (including the approval of the Independent Directors contemplated by Section 1.3(c), if applicable) and the Board of Directors of Parent;

(b)by either Parent or Seller if:

                                 (i) Purchaser shall not have accepted for payment the shares of Seller Common Stock tendered pursuant to the Offer in accordance with the terms hereof and of the Offer on or before December 31, 2010(the “Outside Date”); provided, however, that (i) in the event a condition to the Offer set forth in clause (ii) or (iii)(a) of Annex I hereto shall not have been satisfied on or prior to the Outside Date, but all of the other conditions to the Offer set forth on Annex I hereto shall have been satisfied, or are capable of being satisfied (or have been waived by the party then entitled to give such waiver) on or prior to the Outside Date, then the Outside Date shall be extended without further action by the parties to February 28, 2011, and (ii) Seller may not terminate this Agreement pursuant to this Section 9.1(b)(i) if such failure to accept for payment the shares of Seller Common Stock resulted from the breach of this Agreement by Seller, and Parent may not terminate this Agreement pursuant to this Section 9.1(b)(i) if such failure to accept for payment the shares of Seller Common Stock resulted from the breach of this Agreement by Parent or Purchaser; or

                                 (ii)any Governmental Authority of competent jurisdiction shall have issued a final and non-appealable order, decree, judgment, injunction or ruling or taken any other action enjoining, restraining or otherwise prohibiting the consummation of the Transactions; provided that the party seeking to terminate this Agreement shall have used its reasonable best efforts to have such order, decree, judgment, injun ction or ruling lifted if and to the extent required by Section 7.1;

(c)by Parent, prior to the Acceptance Date:

                 (i) in the event of a breach by Seller of any representation, warranty, covenant or other agreement contained herein that (1) would result in any of the events set forth in clauses (iii)(d) or (e) of Annex I to occur and (2) has not been cured within thirty (30) calendar days following notice by Parent or, if the Outside Date is less than thirty (30) calendar days from the notice by Parent, has not been or cannot reasonably be expected to be cured by the Outside Date; provided, at the time of the delivery of such written notice, Parent and Purchaser shall not be in material breach of its obligations under this Agreement; or

                 (ii)in the event (i) the Seller Board shall have failed to publicly recommend to the Seller Stockholders that they tender their shares into the Offer and/or vote in favor of the adoption and approval of this Agreement and approval of the Merger, including by failing to include the Seller Recommendations in the Schedule 14D-9, (ii) the Seller Board shall have effected an Adverse Recommendation Change, (iii) the Seller Board shall have approved, or recommended that the Seller Stockholders accept or approve, an Acquisition Proposal, or failed to recommend that the Seller Stockholders not tender their shares of Seller Common Stock pursuant to an Acquisition Proposal, (iv) the Seller Board shall have failed to publicly reaffirm the Seller Recommendation within five (5) Business Days following a written request from Parent, (v) Seller shall have breached in any material respect the provisions of Section 7.2, and such violation or breach has resulted in the receipt by Seller of an Acquisition Proposal, or (vi) the Seller Board shall have resolved to do any of the foregoing; or

(d)by Seller:

                 (i)in the event that, prior to the Acceptance Date, Parent or Purchaser shall have (x) breached or failed to perform in any material respect any of its covenants or obligations required to be performed by it under this Agreement or (y) breached any of its representations or warranties, in either case which breach or failure would reasonably be expected to prevent or materially delay the consummation of the Offer or the Merger and is either incurable or, if curable, is not cured by Parent and/or Purchaser within thirty (30) calendar days following notice by Seller or, if the Outside Date is less than thirty (30) calendar days from the notice by Seller, has not been or cannot reasonably be expected to be cured by the Outside Date; provided, at the time of the delivery of such written notice, Seller shall not be in material breach of its obligations under this Agreement;

                 (ii)in the event that, prior to the Acceptance Date, the Seller Board shall have effected an Adverse Recommendation Change in respect of a Superior Proposal in accordance with Section 7.2, and simultaneously with such termination, Seller is entering into an Acquisition Agreement with respect to such Superior Proposal; or

                 (iii)in the event that, prior to the commencement of the Offer, Purchaser fails to commence the Offer as provided in Article I; provided, however, that Seller may not terminate this Agreement pursuant to this Section 9.1(d)(iii) if such failure to commence the Offer resulted from the br each of this Agreement by Seller.

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9.2Effect of Termination.

(a)In the event of a termination and abandonment of this Agreement by either Parent or Seller as provided in Section 9.1, this Agreement shall immediately become void and have no effect, and none of Parent, Purchaser, Seller, any of their respective Subsidiaries or any of the officers or directors of any of them shall have any liability or obligation of any nature whatsoever hereunder, or in connection with the transactions contemplated hereby, except that  Section 7.3(b) (Access to Information), Section 9.2 (Effect of Termination), and Article X (Miscellaneous) and all other obligations of the parties specifically intended to be performed after the termination of this Agreement shall survive any termination of this Agreement.  Notwithstanding the foregoing, none of Parent, Purchaser or Seller shall be relieved or released from any liabilities or damages (which the parties acknowledge and agree shall not be limited to reimbursement of expenses or out-of-pocket costs, and that nothing in this Agreement shall prohibit either party from seeking to prove that such damages include the benefit of the bargain lost by such party or such party’s stockholders) arising out of its intentional breach of any provision of this Agreement or any other agreement delivered in connection herewith or any fraud; provided that the failure of Parent or Purchaser to accept for payment and pay for the shares of Seller Common Stock validly tendered and not withdrawn pursuant to the Offer promptly following the Expiration Date in the event that all Tender Offer Conditions have been satisfied or, to the extent permitted, waived as of the Expiration Date, shall be deemed an intentional breach by Parent and Purchaser of this Agreement, and Parent shall be liable to Seller for such breach notwithstanding any termination of this Agreement.

(b)In the event this Agreement is terminated by:

(A)   Parent pursuant to Section 9.1(c)(ii); or

(B)   Seller pursuant to Section 9.1(d)(ii),

then Seller shall make a cash payment to Parent in the amount of Three Million Eight Hundred Fifty Thousand Dollars ($3,850,000) (the “Seller Termination Amount”).

(c)In the event this Agreement is terminated by Parent pursuant to Section 9.1(c)(i), and prior to such termination an Acquisition Proposal (with all references to 15% in the definition thereof being treated as references to 50% for purposes hereof) had been publicly announced, and if within twelve (12) months following such termination, Seller shall have entered into a definitive agreement to engage in, a transaction qualifying as an Acquisition Proposal (with all references to 15% in the definition thereof being treated as references to 50% for purposes hereof), with any Person other than Pa rent or any Affiliate of Parent, which transaction is subsequently consummated, then Seller shall make a cash payment to Parent of the Seller Termination Amount.

(d)If required under this Section 9.2, the Seller Termination Amount shall be paid in immediately available funds to an account designated by Parent within two (2) Business Days after the date of the event giving rise to the obligation to make such payment; provided, however, if the Seller Termination Amount is payable as a result of a termination pursuant to Section 9.1(d)(ii), then the Seller Termination Amount shall be payable simultaneous with such termination.  The parties acknowledge and agree that the provisions for payment of the Seller Termination Amount are an integral part of the transactions contemplated by this Agreement and are included herein in order to induce Parent to enter into this Agreement and to reimburse Parent for incurring the costs and expenses related to entering into this Agreement and consummating the transactions contemplated by this Agreement.  If Seller fails to pay the Seller Termination Amount and Parent or Purchaser commences a suit which results in a final, non-appealable judgment against Seller for the Seller Termination Amount or any portion thereof, then Seller shall pay Parent and Purchaser their costs and expenses (including reasonable attorney’s fees and disbursements) in connection with such suit, together with interest on the Seller Termination Am ount at the prime rate of PNC Bank in effect on the date such payment was required to be made through the date of payment; provided that if the court in such suit determines in a final, non-appealable judgment that Parent or Purchaser is not entitled to the Seller Termination Amount or any portion thereof, then Parent shall pay Seller its costs and expenses (including reasonable attorney’s fees and disbursements) in connection with such suit.

(e)The parties agree that, other than with respect to any intentional breach of this Agreement by Seller, the payment of the Seller Termination Amount shall be the sole and exclusive remedy available to Parent and Purchaser with respect to this Agreement and the Transaction in the event any payment of the Seller Termination Amount becomes due and payable under the terms of this Agreement, and, upon payment of the Seller Termination Amount, Seller shall have no further liability to Parent and Purchaser hereunder.

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9.3Amendment.

                Subject to compliance with applicable Law, this Agreement may be amended by the parties hereto at any time before or after approval of the matters presented in connection with the Merger to the stockholders of Seller; provided, however, that after the adoption of this Agreement and the approval of the transactions contemplated hereby by the Seller Stockholders, no amendment of this Agreement shall be made which by Law requires further approval by the stockholders of Seller without obtaining such approval.  This Agreement may not be amended except by an instrument in writing signed on behalf of each of the parties hereto.

9.4Extension; Waiver.

At any time prior to the Effective Time, the parties hereto may, to the extent legally allowed, (a) extend the time for the performance of any of the obligations or other acts of the other parties hereto, (b) waive any inaccuracies in the representations and warranties contained herein or in any document delivered pursuant hereto and (c) waive compliance with any of the agreements or conditions contained herein; provided, however, that after the adoption of this Agreement and the approval of the transactions contemplated hereby by the Seller Stockholders, no extension or waiver of this Agreement or any portion thereof shall be made which by Law requires further approval by the stockholders of Seller without obtaining such approval.  Any agreement on th e part of a party hereto to any such extension or waiver shall be valid only if set forth in a written instrument signed on behalf of such party, but such extension or waiver or failure or delay to insist on strict compliance with an obligation, covenant, agreement or condition shall not operate as a waiver of, or estoppel with respect to, any subsequent or other failure.

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ARTICLE X

MISCELLANEOUS

10.1Nonsurvival of Representations, Warranties and Agreements.

None of the representations, warranties, covenants and agreements in this Agreement or in any instrument delivered pursuant to this Agreement shall survive the Effective Time.  Notwithstanding the foregoing, this Section 10.1 shall not limit any covenant or agreement of the parties which by its terms contemplates performance after the Effective Time or relates to delivery of the Exchange Fund in full.

10.2Expenses.

 Except as may otherwise be agreed to hereunder or in other writing by the parties, all legal and other costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such costs and expenses.

10.3Notices.

All notices or other communications hereunder shall be in writing and shall be deemed given if delivered personally, sent by nationally recognized overnight courier (providing proof of delivery) or mailed by prepaid registered or certified mail (return receipt requested) or by telecopy or facsimile transmission (providing confirmation of transmission) addressed as follows:

(a)If to Parent or Purchaser, to:

Kenexa Corporation

650 East Swedesford Road

Wayne, PA 19087

Fax: (610) 971-9181

Attn:  Chief Executive Officer

with required copies to (which shall not constitute notice):

Pepper Hamilton LLP

3000 Two Logan Square

Eighteenth and Arch Streets

Philadelphia, PA 19103

Fax: (610) 640-7835

Attention: John P. Duke, Esquire

(b)If to Seller, to:

Salary.com, Inc.

160 Gould Street

                                                Needham, MA 02494

                                                Fax: (781) 851-8001

                                                Attn: Chief Executive Officer

(c)with required copies to (which shall not constitute notice):

Goodwin Procter LLP

Exchange Place

53 State St.

Boston, MA 02109

Fax: (617) 523-1231

Attn:       Stuart M. Cable, Esq.

James A. Matarese, Esq.

or such other address as shall be furnished in writing by any party, and any such notice or communication shall be deemed to have been given as of the date received by the addressee as provided above; provided that any notice received by facsimile transmission or otherwise at the addressee’s location on any Business Day after 5:00 p.m. Eastern Time shall be deemed to have been received at 9:00 a.m. Eastern Time on the next Business Day.

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10.4Interpretation.

The language used in this Agreement shall be deemed to be the language chosen by the parties to express their mutual intent, and no rule of strict construction shall be applied against any party.  Except where expressly stated otherwise in this Agreement, including Annex I, the following rules of interpretation apply: (i) “either” and “or” are not exclusive and “include,” “includes” and “including” are not limiting and shall be deemed to be followed by the words “without limitation;” (ii) “hereof,” “hereto,” “hereby,” “herein” and “hereunder” and words of similar import refer to this Agreement as a whole, including Annex I , and not to any particular provision; (iii) “date hereof” refers to the date set forth in the initial caption of this Agreement; (iv) “extent” in the phrase “to the extent” means the degree to which a subject or other thing extends, and such phrase does not mean simply “if;” (v) descriptive headings, the table of defined terms and the table of contents are inserted for convenience only and do not affect in any way the meaning or interpretation hereof; (vi) definitions are applicable to the singular as well as the plural forms of such terms; (vii) pronouns shall include the corresponding masculine, feminine or neuter forms; (viii) references to a Person are also to such Person’s permitted successors and assigns; (ix) references to an “Article,” “Section,” “Exhibit,” “Annex” or “Schedule” refer to an Article or Section of, or an Exhibit, Annex or Schedule to, this Agreement, including Annex I; (x) references to “$” or otherwise to dollar amounts refer to the lawful currency of the United States; (xi) references to a federal, state, provincial, local or foreign statute or Law include any rules, regulations and delegated legislation issued thereunder; and (xii) references to a communication by a regulatory agency include a communication by the staff of such regulatory agency.  For purposes of this Agreement, Seller shall not be deemed to be an Affiliate or subsidiary of Purchaser or Parent.  No summary of this Agreement prepared by any party shall affect the meaning or interpretation of this Agreement.  All references to this Agreement shall be deemed to include references to the “plan of merger” contained herein (as such term is used in the DGCL).

10.5Counterparts.

This Agreement may be executed in counterparts, all of which shall be considered one and the same agreement and shall become effective when counterparts have been signed by each of the parties and delivered to the other parties, it being understood that all parties need not sign the same counterpart.  This Agreement may be executed and delivered by facsimile or “PDF” transmission.

10.6Entire Agreement.

 This Agreement, together with the exhibits, annexes and schedules hereto, and any documents delivered by the parties in connection herewith and the Confidentiality Agreements constitute the entire agreement and supersede all prior agreements and understandings, both written and oral, among the parties hereto, or any of them, with respect to the subject matter hereof.

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10.7Governing Law; Jurisdiction and Venue; WAIVER OF JURY TRIAL.

This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware without regard to its rules of conflict of laws.  Each of the parties hereto irrevocably agrees that any legal action or proceeding with respect to this Agreement, and the rights and obligations arising hereunder or for recognition and enforcement of any judgment in respect of this Agreement and the rights and obligations arising hereunder brought by the other party hereto or its successors or assigns, shall be brought and determined exclusively in the Delaware Court of Chancery and any state appellate court therefrom within the State of Delaware (or, if the Delaware Court of Chancery declines to accept jurisdiction over a particular matter, any state or federal court within the State of Delaware). Each of the parties hereto hereby irrevocably submits with regard to any such action or proceeding for itself and in respect of its property, generally and unconditionally, to the personal jurisdiction of the aforesaid courts and agrees that it will not bring any action relating to this Agreement or any of the transactions contemplated by this Agreement in any court other than the aforesaid courts. Each of the parties hereto hereby irrevocably waives, and agrees not to assert as a defense, counterclaim or otherwise, in any Action or proceeding with respect to this Agreement, (a) any claim that it is not personally subject to the jurisdiction of the above named courts for any reason other than the failure to serve in accordance with this Section 10.7, (b) any claim that it or its property is exempt or immune from jurisdiction of any such court or from any legal process commenced in such courts (whether through service of notice, attachment prior to judgment, at tachment in aid of execution of judgment, execution of judgment or otherwise) and (c) to the fullest extent permitted by the applicable Law, any claim that (i) the suit, action or proceeding in such court is brought in an inconvenient forum, (ii) the venue of such suit, action or proceeding is improper or (iii) this Agreement or the subject matter hereof, may not be enforced in or by such courts. Each of the parties hereto irrevocably consents to the service of process out of the Delaware Court of Chancery and any state appellate court therefrom within the State of Delaware (or, if the Delaware Court of Chancery declines to accept jurisdiction over a particular matter, any state or federal court within the State of Delaware) in any such action or proceeding by the mailing of copies thereof by registered mail, postage prepaid, to it its address set forth in Section 10.3 of this Agreement, such service of process to be effective upon acknowledgment of receipt of such registered mail. Nothing herein shall affec t the right of any party to serve process in any other manner permitted by applicable law.  EACH OF PARENT, PURCHASER AND SELLER HEREBY IRREVOCABLY WAIVES ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THE ACTIONS OF PARENT, PURCHASER OR SELLER IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE AND ENFORCEMENT HEREOF.

10.8Severability.

Any term or provision of this Agreement that is invalid or unenforceable in any situation in any jurisdiction shall not affect the validity or enforceability of the remaining terms and provisions hereof or the validity or enforceability of the offending term or provision in any other situation or in any other jurisdiction.  If the final judgment of a court of competent jurisdiction declares that any term or provision hereof is invalid or unenforceable, the parties hereto agree that the court making such determination shall have the power to limit the term or provision, to delete specific words or phrases, or to replace any invalid or unenforceable term or provision with a term or provision that is valid and enforceable and that comes closest to express ing the intention of the invalid or unenforceable term or provision, and this Agreement shall be enforceable as so modified.  In the event such court does not exercise the power granted to it in the prior sentence, the parties hereto agree to replace such invalid or unenforceable term or provision with a valid and enforceable term or provision that will achieve, to the extent possible, the economic, business and other purposes of such invalid or unenforceable term.

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10.9Assignment; Reliance of Other Parties.

Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned by any of the parties hereto in whole or in part (whether by operation of Law or otherwise) without the prior written consent of the other parties and any attempt to make any such assignment without such consent shall be null and void.  Subject to the preceding sentence, this Agreement will be binding upon, inure to the benefit of and be enforceable by the parties and their respective successors and assigns; provided, however, that each of Parent and Purchaser may assign their rights and obligations hereunder to any direct or indirect wholly-owned Subsidiary of Parent to the extent Purchaser and/or Parent, as applicable, agree to remain liable for the per formance of such wholly-owned Subsidiary of its obligations hereunder.  Except (i) as provided in Section 7.4 (Employment and Benefit Matters) hereof, (ii) as provided in Section 7.5 (Directors’ and Officers’ Indemnification and Insurance) hereof and (iii) the provisions of Article I and III concerning payment of the aggregate Offer Price and Merger Consideration, which shall inure to the benefit of the Seller Stockholders but, prior to the Effective Time, may only be enforced by Seller acting on their behalf, this Agreement (including the documents and instruments referred to herein) is not intended to confer upon any Person other than the parties hereto any rights or remedies under or by reason of this Agreement.

10.10Purchaser Performance.

Parent shall cause Purchaser to comply in all respects with each of its representations, warranties, covenants, obligations, agreements and undertakings pursuant to or otherwise in connection with this Agreement, the Offer, the Merger and the other transactions contemplated by this Agreement. Time is of the essence with respect to the performance of this Agreement.

10.11Specific Performance.

(a)The parties hereto agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed by the parties hereto in accordance with their specific terms or were otherwise breached. It is accordingly agreed that Parent and Purchaser, on the one hand, and Seller, on the other hand, shall be entitled to an injunction or injunctions to prevent breaches of this Agreement by the other (as applicable) and to enforce specifically the terms and provisions of this Agreement exclusively in the Delaware Court of Chancery and any state appellate court therefrom within the State of Delaware (or, if the Delaware Court of C hancery declines to accept jurisdiction over a particular matter, any state or federal court within the State of Delaware) and this right shall include the right of Seller to cause the Offer, the Merger and the transactions contemplated thereby to be consummated on the terms and subject to the conditions thereto set forth in this Agreement. Each of the parties hereto hereby waives (i) any defenses in any action for specific performance, including the defense that a remedy at law would be adequate and (ii) any requirement under any Law to post a bond or other security as a prerequisite to obtaining equitable relief. If any party brings any Action to enforce specifically the performance of the terms and provisions hereof by any other party, the Outside Date shall automatically be extended by (x) the amount of time during which such Action is pending, plus twenty (20) Business Days or (y) such other time period established by the Delaware court presiding over such Action.

(b)For the avoidance of doubt, Seller may contemporaneously commence an action for specific performance and seek any other form of remedy at law or in equity that may be available for breach under this Agreement or otherwise in connection with this Agreement or the transactions contemplated hereby (including monetary damages), but no such alternative remedy may be granted unless and until the court has declined to award specific performance.  If a court of competent jurisdiction has declined to specifically enforce the obligations of Parent or Purchaser to cause the Offer, the Merger and the transactions contemplated thereby to be consummated purs uant to a claim for specific performance brought against Parent or Purchaser in connection with this Agreement, any award of damages may be granted by such court for such breach by Parent or Purchaser in accordance with the provisions of Section 9.2.

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10.12Definitions.

 Except as otherwise provided herein or as otherwise clearly required by the context, the following terms shall have the respective meanings indicated when used in this Agreement:

“Acceptance Date” shall have the meaning ascribed thereto in Section 1.3(a) hereof.

“Acquisition Agreement” shall have the meaning ascribed thereto in Section 7.2(e) hereof.

“Action” shall have the meaning ascribed thereto in Section 5.10 hereof.

“Acquisition Proposal” shall have the meaning ascribed thereto in Section 7.2(j) hereof.

“Adverse Recommendation Change” shall have the meaning ascribed thereto in Section 7.2(d) hereof.

“Affiliate” shall mean, with respect to any Person, any other Person controlling, controlled by or under common control with such Person.  As used in this definition, “control” (including, with its correlative meanings, “controlled by” and “under common control with”) means the possession, directly or indirectly, of power to direct or cause the direction of the management and policies of a Person whether through the ownership of voting securities, by contract or otherwise.

“Agreement” shall have the meaning ascribed thereto in the recitals hereto.

“agreement” shall mean any contract, agreement, instrument, obligation, undertaking, lease, license, arrangement, commitment or understanding, whether written or oral, in each case that is legally binding on such Person and as it may be amended or otherwise modified from time to time.

“Appraisal Rights Provisions” shall have the meaning ascribed thereto in Section 3.3(a) hereof.

“Approved Seller Compensation Arrangement” shall have the meaning ascribed thereto in Section 5.23 hereof.

“Arrangements” shall have the meaning ascribed thereto in Section 5.13(g) hereof.

“AST” shall have the meaning ascribed thereto in the recitals hereto.

“Book-Entry Share” and “Book-Entry Shares” shall have the meaning ascribed thereto in Section 3.1(c) hereof.

“Business Day” shall have the meaning ascribed thereto in Rule 14d-1(g)(3) under the Exchange Act.

“Bylaws” shall mean the Amended and Restated Bylaws of Seller.

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“Certificate” and “Certificates” shall have the meaning ascribed thereto in Section 3.1(c) hereof.

“Certificate of Incorporation” shall mean the Amended and Restated Certificate of Incorporation of Seller, as amended.

“Certificate of Merger” shall have the meaning ascribed thereto in Section 2.2 hereof.

“Change-in-Control Arrangements” shall have the meaning ascribed thereto in Section 7.4(c) hereof.

“Closing” shall have the meaning ascribed thereto in Section 2.2 hereof.

“Closing Date” shall have the meaning ascribed thereto in Section 2.2 hereof.

“Code” shall mean the Internal Revenue Code of 1986, as amended.

“Confidentiality Agreements” shall mean those certain letter agreements by and between Seller and Parent, dated as of June 4, 2010 and August 5, 2010.

“Copyrights” shall have the meaning ascribed thereto in Section 5.19(c)(i)(C) hereof.

“Covered Parties” shall have the meaning ascribed thereto in Section 7.5(b) hereof.

“Covered Securityholders” shall mean certain Seller Stockholders and holders of other securities of Seller.

“DGCL” shall have the meaning ascribed thereto in the recitals hereto.

“Dissenting Shares” shall have the meaning ascribed thereto in Section 3.3(a) hereof.

“Dissenting Stockholders” shall have the meaning ascribed thereto in Section 3.3(a) hereof.

“DOJ” shall have the meaning ascribed thereto in Section 7.1(c) hereof.

“Effective Time” shall have the meaning ascribed thereto in Section 2.2 hereof.

“Employment Compensation Arrangement” shall have the meaning ascribed thereto in Section 5.13(h) hereof.

“Encumbrances” shall mean all transfer and voting restrictions, liens, security interests, mortgages, pledges, hypothecations, easements, covenants, declarations, conditions and restrictions, defects in or clouds on title and other encumbrances of every kind and nature (including options, preemptive right, rights of first negotiation and rights of first refusal), whether arising by agreement, operation of law or otherwise.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended.

“ERISA Affiliate” shall mean any Person that together with Seller would be treated as a single employer under Section 414(b), (c), (m) or (o) of the Code or Section 4001(b) of ERISA.

“ESPP” shall have the meaning ascribed thereto in Section 3.4(d) hereof.

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

“Exchange Fund” shall have the meaning ascribed thereto in Section 3.2(a)  hereof.

“Expiration Date” shall have the meaning ascribed thereto in Section 1.1(c) hereof.

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“Final Exercise Date” shall have the meaning ascribed thereto in Section 3.4(d) hereof.

“FTC” shall have the meaning ascribed thereto in Section 7.1(c) hereof.

“fully diluted basis” shall have the meaning ascribed thereto in Annex I.

“GAAP” shall mean generally accepted accounting principles.

“Governmental Authority” shall mean any (i) United States, foreign, federal, state, local or other government, (ii) governmental commission, board, body, bureau, agency, or other judicial, regulatory or administrative authority of any nature, including courts and other judicial bodies, (iii) any self-regulatory body or authority, and (iv) any instrumentality or entity designed to act for or on behalf of the foregoing.

“HSR Act” shall mean the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.

“Indemnified Parties” shall have the meaning ascribed thereto in Section 7.5(a) hereof.

“Independent Directors” shall have the meaning ascribed thereto in Section 1.3(c) hereof.

“Insurance Policies” shall have the meaning ascribed thereto in Section 5.20 hereof.

“Intellectual Property Assets” shall have the meaning ascribed thereto in  Section 5.19(c)(i) hereof.

“Intervening Event” shall mean any material development or change in circumstances occurring or arising after the date hereof that was neither known to the Seller Board nor reasonably foreseeable as of or prior to the date hereof; provided, however, that in no event shall the receipt, existence or terms of an Acquisition Proposal (whether or not a Superior Proposal) or any event arising therefrom, relating thereto or any consequence thereof, constitute an Intervening Event.

“IRS” shall mean the Internal Revenue Service.

“Key Employee” shall mean each of the individuals listed in Section 10.12 of the Seller Disclosure Schedule.

“Law” shall mean any federal, state, local or foreign law, statute, ordinance or principle of common law, or any rule, regulation, standard, judgment, order, writ, injunction, decree, arbitration award, agency requirement, license or permit of any Governmental Authority.

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“made available” shall mean that such information or documentation was either (a) provided directly to Parent or Parent’s outside counsel or outside auditing firm in its capacity as Parent’s agent or advisor, (b) included in the Company’s Intralinks, Inc. data site’s “Project Spirit” section in a folder to which Parent or its advisors had access on or before 12:01 am (EST) on the date prior to the date of execution of this Agreement, or (c) filed by Seller with the SEC on the SEC’s Electronic Data Gathering, Analysis, and Retrieval system.

“Marks” shall have the meaning ascribed thereto in Section 5.19(c)(i)(B) hereof.

“Material Customers and Suppliers” shall have the meaning ascribed thereto in Section 5.24 hereof.

“Merger” shall have the meaning ascribed thereto in the recitals hereto.

“Merger Consideration” shall have the meaning ascribed thereto in Section 3.1(c) hereof.

“Minimum Condition” shall have the meaning ascribed thereto in Annex I.

“Notice Period” shall have the meaning ascribed thereto in Section 7.2(e) hereof.

“Offer” shall have the meaning ascribed thereto in the recitals hereto.

“Offer Documents” shall have the meaning ascribed thereto in Section 1.1(e) hereof.

“Offer Price” shall have the meaning ascribed thereto in the recitals hereto.

“Out-of-the-Money Seller Stock Option" mean any Seller Stock Option with a per share exercise price which is higher than the Offer Price.

“Outside Date” shall have the meaning ascribed thereto in Section 9.1(b)(i) hereof.

“Owned Real Property” shall have the meaning ascribed thereto in Section 5.16(a) hereof.

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“Parent” shall have the meaning ascribed thereto in the recitals hereto.

“Parent Arrangements” shall have the meaning ascribed thereto in Section 4.8 hereof.

“Parent Disclosure Schedule” shall have the meaning ascribed thereto in Article IV hereof.

“Parent Material Adverse Effect” shall mean any change, event, circumstance, development or effect (each, a “Change”, and collectively, “Changes”) that, individually or in the aggregate with all other Changes occurring or existing prior to the determination of a Parent Material Adverse Effect, would reasonably be expected to prevent or materially delay consummation of the Offer or the Merger or materially impair or delay the ability of Parent or Purchaser to perform their respective obligations under this Agreement.

“Patents” shall have the meaning ascribed thereto in Section 5.19(c)(i)(A) hereof.

“Paying Agent” shall have the meaning ascribed thereto in Section 3.2(a) hereof.

“Permitted Encumbrances” shall mean (i) Encumbrances for Taxes not yet due and payable or Taxes being contested in good faith, (ii) statutory Encumbrances existing as of the Closing Date and held by any Governmental Authority that are related to obligations that are not due or delinquent, (iii) Encumbrances reflected in the consolidated financial statements of the Seller and Subsidiary contained in the Seller SEC Documents or referenced in the Seller Disclosure Schedule, (iv) Encumbrances or imperfections of title that do not materially detract from the value or materially interfere with the use of the assets subject thereto or affected thereby or (v) Encumbrances on the landlord’ s interest in the premises not caused by Seller, any Subsidiary of Seller or any of their respect agents, contractors or representatives.

“Person” shall mean any individual, corporation, partnership, joint venture, association, trust, unincorporated organization or other legal entity, or any Governmental Authority or political subdivision thereof.

“Post-Signing Arrangement” shall have the meaning ascribed thereto in Section 7.10(b) hereof.

“Proxy Statement” shall have the meaning ascribed thereto in Section 2.6(a)(ii) hereof.

“Purchaser” shall have the meaning ascribed thereto in the recitals hereto.

“Purchaser Common Stock” shall have the meaning ascribed thereto in Section 3.1(a) hereof.

“Purchaser Designees” shall have the meaning ascribed thereto in Section 1.3(a) hereof.

“Qualified Bidder” shall have the meaning ascribed thereto in Section 7.2(c) hereof.

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“Regulatory Law” shall mean the Sherman Act, as amended, Council Regulation No. 4064/89 of the European Community, as amended, the Clayton Act, as amended, the HSR Act, the Federal Trade Commission Act, as amended, and all other Federal, state and foreign, if any, statutes, rules, regulations, orders, decrees, administrative and judicial doctrines and other Laws that are designed or intended to prohibit, restrict or regulate (i) foreign investment or (ii) actions having the purpose or effect of monopolization or restraint of trade or lessening of competition.

“Representatives” shall mean the directors, officers, employees, Affiliates, agents, investment bankers, financial advisors, attorneys, accountants, brokers, finders, consultants or representatives of Seller, Parent, Purchaser or any of their respective Subsidiaries, as the case may be.

“Rights Agreement” shall have the meaning ascribed thereto in the recitals hereto.

“Rights Plan Amendment” shall have the meaning ascribed thereto in the recitals hereto.

“Sarbanes-Oxley Act” shall have the meaning ascribed thereto in Section 5.5(a) hereof.

“Schedule 14D-9” shall have the meaning ascribed thereto in Section 1.2(a) hereof.

“Schedule TO” shall have the meaning ascribed thereto in Section 1.1(e) hereof.

“SEC” shall have the meaning ascribed thereto in Section 1.1(c)(ii) hereof.

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

“Seller” shall have the meaning ascribed thereto in the recitals hereto.

“Seller 2004 Stock Options” shall mean options to purchase Seller Common Stock issued under the Seller 2004 Stock Plan.

“Seller 2004 Stock Plan” shall mean the stock plan of Seller designated as the 2004 Stock Option and Incentive Plan.

“Seller Balance Sheet” shall have the meaning ascribed thereto in Section 5.6 hereof.

“Seller Benefit Plans” shall have the meaning ascribed thereto in Section 5.13(a) hereof.

“Seller Board” shall mean the board of directors of Seller.

“Seller Common Stock” shall have the meaning ascribed thereto in the recitals hereto.

“Seller Compensation Arrangement” shall have the meaning ascribed thereto in Section 5.23 hereof.

“Seller Compensation Committee” shall have the meaning ascribed thereto in Section 5.13(h) hereof.

“Seller Contracts” shall have the meaning ascribed thereto in Section 5.15 hereof.

“Seller Copyrights” shall have the meaning ascribed thereto in Section 5.19(a) hereof.

“Seller Disclosure Schedule” shall have the meaning ascribed thereto in Article V hereof.

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“Seller Employees” shall have the meaning ascribed thereto in Section 7.4(a) hereof.

“Seller Financial Statements” shall have the meaning ascribed thereto in Section 5.6 hereof.

“Seller Governmental Approvals” shall have the meaning ascribed thereto in Section 5.11 hereof.

“Seller Intellectual Property Assets” shall have the meaning ascribed thereto in Section 5.19(c)(iii) hereof.

“Seller Leases” shall have the meaning ascribed thereto in Section 5.16(b) hereof.

“Seller Marks” shall have the meaning ascribed thereto in Section 5.19(a) hereof.

“Seller Material Adverse Effect” shall mean any Change that, individually or in the aggregate with all other Changes occurring or existing prior to the determination of a Seller Material Adverse Effect, has, or would reasonably be expected to have, a material adverse effect on (i) the business, assets, liabilities, condition (financial or other) or results of operations of Seller and its Subsidiaries, taken as a whole, or (ii) the ability of Seller to consummate the transactions contemplated by this Agreement; provided, however, that none of the following (to the extent arising after the date hereof) shall be deemed to be or constitute a Seller Material Adverse Effect, or taken into account when determining whether a Seller Material Adverse Effect has occurred or would occur:

(i)  any Change to the extent resulting from general economic conditions in the United States or any other country or region in the world (in each case other than Changes that affect Seller and its Subsidiaries, taken as a whole, in a disproportionate manner as compared to Seller’s Industry peers);

(ii) any Change to the extent resulting from conditions in the industries in which Seller and any Subsidiary of Seller conduct business (the “Seller’s Industry”) (in each case other than Changes that affect Seller and each Subsidiary of Seller, taken as a whole, in a disproportionate manner as compared to Seller’s Industry peers);

(iii)  any Change to the extent resulting from acts of war, sabotage or terrorism in the United States or any other country or region in the world (in each case other than Changes that affect Seller and its Subsidiaries, taken as a whole, in a disproportionate manner as compared to Seller’s Industry peers);

(iv)  any Change to the extent resulting from changes in law or other legal or regulatory conditions (in each case other than Changes that affect Seller and its Subsidiaries, taken as a whole, in a disproportionate manner as compared to Seller’s Industry peers);

(vi)  any Change to the extent resulting from changes in GAAP (in each case other than Changes that affect Seller and its Subsidiaries, taken as a whole, in a disproportionate manner as compared to Seller’s Industry peers);

(vi)  any Change to the extent resulting from changes in Seller’s stock price or the trading volume of Seller Common Stock, in and of itself (it being understood that the facts or occurrences giving rise or contributing to such changes may be deemed to constitute, or be taken into account in determining whether there has been, or would be, a Seller Material Adverse Effect);

(vii) any Change resulting from compliance with the terms of this Agreement or the taking of any action or failure to take action required by this Agreement or requested or approved by or consented to by Parent;

(viii)  any Change to the extent resulting from any failure by Seller to meet any internal or public estimates, projections, budgets, forecasts or expectations of Seller’s revenue, earnings or other financial performance or results of operations for any period, in and of itself (it being understood, in each case, that the facts or occurrences giving rise or contributing to such failure may be deemed to constitute, or be taken into account in determining whether there has been, or would be, a Seller Material Adverse Effect); and

(ix)  any Change to the extent resulting from the pendency or announcement of the Offer, the Merger or the transactions contemplated by this Agreement, including the termination of relationships by customers, suppliers or any other Person having a contractual relationship with Seller or any Subsidiary of Seller or the termination by employees of their employment with Seller or any Subsidiary of Seller.

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“Seller Other Plans” shall have the meaning ascribed thereto in Section 5.13(a) hereof.

“Seller Patents” shall have the meaning ascribed thereto in Section 5.19(a) hereof.

“Seller Pension Plans” shall have the meaning ascribed thereto in Section 5.13(a) hereof.

“Seller Personnel” shall mean any current or former director, officer, employee, independent contractor or consultant of Seller or any of its Subsidiaries.

“Seller Preferred Stock” shall have the meaning ascribed thereto in Section 5.2(a) hereof.

“Seller Products” shall mean products (including computer software programs) and/or services currently or previously commercially distributed and/or otherwise made commercially available by Seller or any of its Subsidiaries.

“Seller Recommendations” shall have the meaning ascribed thereto in Section 1.2(a) hereof.

“Seller Restricted Stock Awards” shall mean awards of restricted Seller Common Stock issued under the Seller Stock Plans.

“Seller Restricted Stock Units” shall mean rights, subject to vesting, issued under the Seller Stock Plans to receive Seller Common Stock.

“Seller Rights” shall have the meaning ascribed thereto in the recitals hereto.

“Seller SEC Documents” shall have the meaning ascribed thereto in Section 5.5(a) hereof.

“Seller Stockholder Approval” shall have the meaning ascribed thereto in Section 5.18(b) hereof.

“Seller Stockholders” shall mean the holders of Seller Common Stock.

“Seller Stock Options” shall mean options to purchase Seller Common Stock issued under the Seller Stock Plans.

“Seller Stock Plans” shall mean the stock plans of Seller designated as the 2000 Stock Option and Incentive Plan, 2007 Stock Option and Incentive Plan, Genesys Software Systems, Inc. Directors and Consultants Stock Option Plan dated March 10, 1998, (amended and restated through December 10, 2008), Genesys Software Systems, Inc. Stock Option Plan of November 17, 2000 (amended and restated through December 10, 2008) and Genesys Software Systems, Inc. Incentive Stock Option Plan dated November 16, 1990 (amended and restated through December 10, 2008) and all other equity plans of the Seller or any Subsidiary (other than the Seller 2004 Stock Plan).

“Seller Termination Amount” shall have the meaning ascribed thereto in Section 9.2(b) hereof.

“Seller Trade Secrets” shall have the meaning ascribed thereto in Section 5.19(b)(viii) hereof.

“Seller Warrants” shall mean those warrants issued by Seller to purchase 1,400 shares of Seller Common Stock at an exercise price of $0.89 per share.

“Seller’s Business” shall have the meaning ascribed thereto in Section 5.19(c)(ii) hereof.

“Seller’s Financial Advisor” shall have the meaning ascribed thereto in Section 5.9 hereof.

“Seller’s knowledge” or “knowledge of Seller”, or any other phrases of similar meaning, shall mean the actual knowledge (after reasonable investigation) of the individuals set forth in Section 10.12 of the Seller Disclosure Schedule.

“Short Form Threshold” shall have the meaning ascribed thereto in Section 2.7 hereof.

“Special Meeting” shall have the meaning ascribed thereto in Section 2.6(a)(i) hereof.

“Subsequent Determination Notice” shall have the meaning ascribed thereto in Section 7.2(e) hereof.

“Subsidiary” or “Subsidiaries” shall mean, when used with reference to a party, any corporation or other organization, whether incorporated or unincorporated, of which such party or any other subsidiary of such party is a general partner (excluding partnerships the general partnership interests of which held by such party or any subsidiary of such party do not have a majority of the voting interests in such partnership) or serves in a similar capacity, or, with respect to such corporation or other organization, at least a majority of the securities or other interests having by their terms ordinary voting power to elect a majority of the board of directors or others performing similar fu nctions is directly or indirectly owned or controlled by such party or by any one or more of its subsidiaries, or by such party and one or more of its subsidiaries.

“Superior Proposal” shall have the meaning ascribed thereto in Section 7.2(i) hereof.

“Support Agreements” shall have the meaning ascribed thereto in the recitals hereto.

“Surviving Corporation” shall have the meaning ascribed thereto in Section 2.1 hereof.

“Surviving Corporation Bylaws” shall have the meaning ascribed thereto in Section 2.4 hereof.

“Surviving Corporation Charter” shall have the meaning ascribed thereto in Section 2.4 hereof.

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“Tax” shall mean any and all taxes, customs, duties, tariffs, imposts, charges, deficiencies, assessments or levies, including, without limitation, income, gross receipts, excise, real or personal property, ad valorem, value added, estimated, alternative minimum, stamp, sales, withholding, social security, occupation, use, service, service use, license, net worth, payroll, franchise, transfer and recording taxes and charges, imposed by the IRS or any other taxing authority (whether domestic or foreign including, without limitation, any state, county, local or foreign government or any subdivision or taxing agency thereof (including a United States possession)); and such term shall inclu de any interest, fines, penalties or additional amounts attributable to, or imposed upon, or with respect to, any such amounts.

“Tax Return” shall mean any report, return, declaration or filing required to be supplied to any taxing authority or jurisdiction (foreign or domestic) with respect to Taxes.

“Tender Offer Conditions” shall mean the conditions to the Offer set forth in Annex I hereto.

“Third Party Rights” shall have the meaning ascribed thereto in Section 5.19(b)(v) hereof.

“Top-Up Option” shall have the meaning ascribed thereto in Section 1.4(a) hereof.

“Top-Up Option Shares” shall have the meaning ascribed thereto in Section 1.4(a) hereof.

“Trade Secrets” shall have the meaning ascribed thereto in Section 5.19(c)(i)(D) hereof.

“Transaction” shall have the meaning ascribed thereto in the recitals hereto.

“U.S.” shall mean the United States of America.

“Voting Debt” shall have the meaning ascribed thereto in Section 5.2(a) hereof.

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IN WITNESS WHEREOF, Parent, Purchaser and Seller have caused this Agreement to be executed as a sealed instrument by their duly authorized officers as of the day and year first above written.

KENEXA CORPORATION
By:	/s/ Nooruddin S. Karsan
	Name: Nooruddin S. Karsan
	Title: Chief Executive Officer

SPIRIT MERGER SUB, INC.
By:	/s/ Donald F. Volk
	Name: Donald F. Volk
	Title: President

SALARY.COM, INC.
By:	/s/ Paul Daoust
	Name: Paul Daoust
	Title: President and Chief Executive Officer

52

ANNEX I

CONDITIONS OF THE OFFER

Notwithstanding any other provisions of the Offer, Parent and Purchaser shall not be required to accept for payment or, subject to any applicable rules and regulations of the SEC, including Rule 14e-1(c) promulgated under the Exchange Act, pay for, and may delay the acceptance for payment of or the payment for, any validly tendered shares of Seller Common Stock and may (subject to the terms of the Agreement) terminate or amend the Offer, if (i) there shall not be validly tendered and not withdrawn prior to the Expiration Date that number of shares of Seller Common Stock which, when added to any shares of Seller Common Stock already owned by Parent or any of its controlled Subsidiaries, represents at least a majority of the total number of outstanding shares of S eller Common Stock on a “fully diluted basis” (where “on a fully diluted basis” means the number of shares of Seller Common Stock outstanding, together with the shares of Seller Common Stock which Seller may be required to issue pursuant to warrants, options or other obligations outstanding at that date under employee stock or similar benefit plans or otherwise, whether or not vested or then exercisable; provided that “on a fully diluted basis” shall not contemplate the potential dilutive effect attributable to the Seller Rights and the Top-Up Option) on the Expiration Date (the “Minimum Condition”), (ii) any applicable waiting period or approval under the HSR Act or other applicable foreign antitrust, competition or similar statutes or regulations shall not have expired or been terminated or obtained prior to the Expiration Date, or (iii) at any time on or after the date of the Agreement and prior to the time of acceptance for payment for any shares of Seller Common Stock, any of the following events shall occur and continue to exist:

(a)there shall be instituted, pending or threatened in writing any suit, action or proceeding by any Governmental Entity:

(i)challenging, making illegal or otherwise restraining or prohibiting, or seeking to challenge, make illegal or otherwise restrain or prohibit, the transactions contemplated by the Agreement, including the Offer and the Merger;

(ii)seeking to prohibit or materially limit the ownership or operation by Seller, Parent or Purchaser of all or any material portion of the business or assets of Seller and its Subsidiaries or (to the extent it relates to the transactions contemplated by the Agreement, including the Offer and the Merger) of Parent and its Affiliates;

(iii)seeking to compel Seller, Parent or Purchaser to dispose of or to hold separate all or any material portion of the business or assets of Seller or any of its Subsidiaries or (to the extent it relates to the transactions contemplated by the Agreement, including the Offer and the Merger) of Parent or any of its Affiliates;

(iv)seeking to impose any material limitation on the ability of Seller, Parent or Purchaser to conduct the business or own the assets of Seller or any of its Subsidiaries or (to the extent it relates to the transactions contemplated by the Agreement, including the Offer and the Merger) of Parent or any of its Affiliates;

I-1

(v)seeking to impose material limitations on the ability of Parent or Purchaser to acquire or hold, or to exercise full rights of ownership of any shares of Seller Common Stock, including the right to vote such shares on all matters properly presented to the Seller Stockholders;

(vi)seeking to require divestiture by Parent or Purchaser of all or any of the shares of Seller Common Stock;

(b)(i) an Adverse Recommendation Change shall have occurred, (ii) a Seller Material Adverse Effect shall have occurred and be continuing, or (ii) the Seller Board or any committee of the Seller Board shall have authorized or permitted Seller or any of its Subsidiaries to enter into an Acquisition Agreement;

(c)Seller and Purchaser and Parent shall have reached an agreement that the Offer or the Agreement be terminated, or the Agreement shall have been terminated in accordance with its terms;

(d)the representations and warranties of Seller contained in the Agreement shall not be true and correct (1) as of the date of the Agreement except for representations and warranties that relate to a specific date or time (which need only be true and correct in all material respects as of such date or time) and (2) as of the Expiration Date without giving effect to the words “materially” or “material” or to any qualification based on the defined term “Seller Material Adverse Effect” except for representations and warranties that relate to a specific date or time (which need only be true and correct in all material respect s as of such date or time), in each case, except where the failure to be so true and correct, individually or in the aggregate, does not have or would not reasonably be expected to have a Seller Material Adverse Effect;

(e)Seller shall have breached or failed to perform in all material respects any obligation, agreement or covenant required to be performed by it under the Agreement and such breach or failure to perform shall not have been cured to the good faith satisfaction of Parent;

(f)any of the representations and warranties of the Seller set forth in Section 5.2 shall not be true and correct in all respects as of the date of the Agreement, other than de minimus amounts involving discrepancies of no more than 35,065 shares of Seller Common Stock in the aggregate; or

(g)there shall be any Law enacted, issued, promulgated or enforced which restrains, enjoins or prohibits consummation of the Offer or the Merger or makes the consummation of the Offer or the Merger illegal.

The foregoing conditions are for the sole benefit of Parent and Purchaser and may be asserted by Parent or Purchaser regardless of the circumstances giving rise to any such conditions and may be waived by Parent or Purchaser in whole or in part at any time and from time to time in their sole discretion (except for the Minimum Condition), in each case, subject to the terms of the Agreement and the applicable rules and regulations of the SEC.  The foregoing conditions shall be in addition to, and not in limitation of the rights of Parent and Purchaser to extend, terminate and/or modify the Offer pursuant to the terms of the Agreement.  The failure by Parent or Purchaser at any time to exercise any of the foregoing rights shall not be deemed a wa iver of any such right and each such right shall be deemed an ongoing right which may be asserted at any time and from time to time.

The capitalized terms used in this Annex I shall have the meanings set forth in the Agreement to which it is annexed.

I-2

EX-2.2 3 ex2-2.htm FORM OF TENDER AND SUPPORT AGREEMENT

Exhibit 2.2

TENDER AND SUPPORT AGREEMENT

THIS TENDER AND SUPPORT AGREEMENT (this “Agreement”) dated as of August 31, 2010 is made by and among Kenexa Corporation, a Pennsylvania corporation (“Parent”), Spirit Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of Parent (“Purchaser”), and each stockholder listed on Annex I (each, a “Stockholder” and collectively, the “Stockholders”), each an owner of shares (the “Shares< /font>”) of common stock, par value $0.0001 per share, of Salary.com, Inc., a Delaware corporation (the “Company”).

WHEREAS, as of the date hereof, each Stockholder is the beneficial owner (as defined in Rule 13d-3 under the Exchange Act) of the number of Shares set forth opposite such Stockholder’s name under the heading “Shares Beneficially Owned” on Annex I (all such directly owned Shares which are outstanding as of the date hereof and which may hereafter be acquired pursuant to acquisition by purchase, stock dividend, distribution, stock split, split-up, combination, merger, consolidation, reorganization, recapitalization, combination or similar transaction, being referred to herein as the “Subject Shares;” provided that ̶ 0;Subject Shares” shall not include Shares beneficially owned in the form of Company Options or restricted stock, but only to the extent such Shares remain unvested, restricted or unexercised, as the case may be); and

WHEREAS, as a condition to their willingness to enter into the Agreement and Plan of Merger (the “Merger Agreement”) dated as of the date hereof by and among Parent, Purchaser and the Company, Parent and Purchaser have requested that each Stockholder, and in order to induce Parent and Purchaser to enter into the Merger Agreement, each Stockholder (only in such Stockholder’s capacity as a stockholder of the Company) has agreed to, enter into this Agreement; and

WHEREAS, capitalized terms used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Merger Agreement.

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

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ARTICLE 1

AGREEMENT TO TENDER

Section 1.01Agreement to Tender

(a).  Each Stockholder shall duly tender, in the Offer, all of such Stockholder’s Subject Shares pursuant to and in accordance with the terms of the Offer, provided that the Offer price does not decrease.  Promptly, but in any event no later than ten (10) Business Days after the commencement of the Offer, each Stockholder shall (i) deliver to the depositary designated in the Offer (the “Depositary”) (A) a letter of transmittal with respect to such Stockholder’s Subject Shares complying wi th the terms of the Offer, (B) a certificate or certificates representing such Subject Shares or, in the case of a book-entry transfer of any uncertificated Subject Shares, an “agent’s message” (or such other evidence, if any, of transfer as the Depositary may reasonably request) and (C) all other documents or instruments required to be delivered pursuant to the terms of the Offer, and/or (ii) instruct such Stockholder’s broker or such other Person that is the holder of record of Stockholder’s Subject Shares to tender such Subject Shares pursuant to and in accordance with the terms of the Offer. Purchaser may elect to provide a subsequent offering period for the Offer in accordance with the Merger Agreement, and each Stockholder shall duly tender to Purchaser during such subsequent offering period all of the Subject Shares, if any, which shall have been issued after the expiration of the Offer.  Each Stockholder agrees that once such Stockholder’s Subject Shares are tendered pursuant to the terms hereof, such Stockholder will not withdraw any tender of such Subject Shares, unless and until (x) the Offer shall have been terminated or shall have expired, in each case, in accordance with the terms of the Merger Agreement, or (y) this Agreement shall have been terminated in accordance with Section 4.03 hereof. The Stockholder acknowledges that Purchaser’s obligation to accept for payment and pay for the Subject Shares is subject to all of the terms and conditions of the Offer.

Section 1.02Voting of Subject Shares

(a).  At every meeting of the stockholders of the Company called for such purpose, and at every adjournment or postponement thereof, each Stockholder shall, or shall cause the holder of record on any applicable record date to, vote such Stockholder’s Subject Shares (to the extent that any of such Stockholder’s Subject Shares are not purchased in the Offer and provided that the Offer price was not decreased) (i) in favor of the adoption of the Merger Agreement and the transactions contemplated thereby; (ii) against (A) any agreement or arrangement related to any Acquisi tion Proposal, (B) any liquidation, dissolution, recapitalization, extraordinary dividend or other significant corporate reorganization of the Company or any of its Subsidiaries, and (C) any change in the present capitalization of the Company or any amendment to the Company’s certificate of incorporation or bylaws; (iii) in favor of any other matter necessary for consummation of the transactions contemplated by the Merger Agreement; and (iv) against any other action, proposal or agreement that would reasonably be expected, to (A) impede, interfere with, materially delay or postpone the Merger and the other transactions contemplated by the Merger Agreement or (B) result in a breach in any respect of any covenant, representation or warranty, or any other obligation or agreement of the Company under the Merger Agreement, and in connection therewith, such Stockholder shall execute any documents which are necessary or a ppropriate in order to effectuate the foregoing.  Each Stockholder shall retain at all times the right to vote such Stockholder’s Subject Shares in Stockholder’s sole discretion and without any other limitation on those matters other than those set forth in this Section 1.02 that are at any time or from time to time presented for consideration to the Company’s stockholders generally.  In the event that any meeting of the stockholders of the Company is held, such Stockholder shall, or shall cause the holder of record on any applicable record date to, appear at such meeting or otherwise cause such Stockholder’s Subject Shares (to the extent that any of such Stockholder’s Subject Shares are not purchased in the Offer and provided that the Offer price was not decreased) to be counted as present thereat for purposes of establishing a qu orum.

2

ARTICLE 2

REPRESENTATIONS AND WARRANTIES

Section 2.01Representations and Warranties of the Stockholders

Each Stockholder hereby severally but not jointly represents and warrants to Parent and Purchaser as follows:

(a)Authorization; Validity of Agreement; Necessary Action.  Such Stockholder has all requisite power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby.  To the extent applicable, the execution and delivery of this Agreement and the consummation by the Stockholder of the transactions contemplated hereby have been duly authorized by all necessary action (corporate or otherwise) on the part of such Stockholder.  This Agreement has been duly executed and delivered by such Stockholder and constitutes a valid and binding obligation of such Stockholder, enforceable in accordance with its te rms (except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and to general equity principles).  If such Stockholder is married and the Shares set forth on Annex I hereto constitute community property under applicable laws, this Agreement has been duly authorized, executed and delivered by, and constitutes the valid and binding agreement of, such Stockholder’s spouse.

(b)Ownership.  As of the date hereof, the number of Shares beneficially owned (as defined in Rule 13d-3 under the Exchange Act) by such Stockholder is set forth opposite such Stockholder’s name under the heading “Shares Beneficially Owned” on Annex I.  Such Stockholder’s Subject Shares are, and (except as otherwise expressly permitted by this Agreement) any additional Shares and any options and warrants to purchase Shares, or any other securities of the Company convertible, exercisable or exchangeable into Shares that are acquired by the Stockholder after the date hereof and prior to the Effective Time will be, owned benefici ally by the Stockholder.  As of the date hereof, such Stockholder’s Subject Shares constitute all of the securities of the Company (other than Shares beneficially owned in the form of options to purchase Shares outstanding as of the date hereof) held of record, beneficially owned by or for which voting power or disposition power is held or shared by the Stockholder.  Such Stockholder has and (except as otherwise expressly permitted by this Agreement) will have at all times through the Effective Time sole voting power, sole power of disposition, sole power to issue instructions with respect to the matters set forth in Article 1, Article 3, and Section 4.03 hereof, and sole right, power and authority to agree to all of the matters set forth in this Agreement, in each case with respect to all of such Stockholder’s Subject Shares and with respect to all of such Stockholder’s Shares at all times through the Effective Time, with no limitations, qualifications or restrictions o n such rights, subject to applicable federal securities laws and the terms of this Agreement.  Except as set forth on Annex I, such Stockholder has good, valid and marketable title to such Stockholder’s Subject Shares, free and clear of all liabilities, claims, liens, options, proxies, changes, participations, and encumbrances of any kind or character whatsoever (collectively, “Liens”), other than those arising under the securities laws or under the Company’s governance documents, and such Stockholder will have good, valid, and marketable title to all of such Stockholder’s Shares at all times through the Effective Time, free and clear of any Liens, other than those arising under the securities laws or under the Company’s governance documents.  Such Stockholder further represents that any proxies heretofore given in respect of the Shares owned beneficially and of record by such Stockholder are revocable, and hereby revokes such proxies.

(c)No Violation.  The execution and delivery of this Agreement by such Stockholder does not, and the performance by such Stockholder of its obligations under this Agreement will not, (i) assuming the filing of such reports as may be required under Sections 13(d) and 16 of the Exchange Act, which such Stockholder will file, conflict with or violate any Law applicable to such Stockholder or by which any of such Stockholder’s assets or properties is bound or (ii) conflict with, result in any breach of or constitute a default (or an event that with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, or require payment under, or result in the creation of any Lien on the properties or assets of such Stockholder pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise or other instrument or obligation to which such Stockholder is a party or by which such Stockholder or any of such Stockholder’s assets or properties is bound, except for any of the foregoing as could not reasonably be expected, either individually or in the aggregate, to materially impair the ability of such Stockholder to perform such Stockholder’s obligations hereunder or to consummate the transactions contemplated hereby on a timely basis.  The execution and delivery of this Agreement by such Stockholder does not, and the performance of this Agreement by such Stockholder will not, require any consent, approval, authorization or permit of, or filing with or notification to any (i) Governmental Authority, excep t for filings that may be required under the Exchange Act and the HSR Act or (ii) third party (including with respect to individuals, any spouse, and with respect to trusts, any co-trustee or beneficiary).

3

(d)Information.  None of the information relating to such Stockholder provided by or on behalf of such Stockholder in writing for inclusion in the Offer Documents, the Schedule 14D-9 or the Proxy Statement will, at the respective times such documents are filed with the SEC or are first published, sent or given to stockholders of the Company, contain any untrue statement of material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.

(e)Absence of Litigation.  As of the date hereof, there is no suit, action, investigation or proceeding pending or, to the knowledge of such Stockholder, threatened against such Stockholder before or by any Governmental Authority that would impair the ability of such Stockholder to perform its obligations hereunder or to consummate the transactions contemplated hereby on a timely basis.

(f)No Finder’s Fee. No broker, investment banker, financial advisor or other Person is entitled to any broker’s, finder’s, financial advisor’s or other similar fee or commission in connection with the transactions contemplated hereby based upon arrangements made by or on behalf of the Stockholder (other than in such Stockholder’s capacity as an officer or director of the Company and as disclosed pursuant to the Merger Agreement).

(g)Acknowledgement. The Stockholder (i) acknowledges receipt of, and has had an opportunity to read and understand and consult with independent counsel concerning, the Merger Agreement (including exhibits and schedules thereto); and (ii) understands and acknowledges that each of Parent and Purchaser is entering into the Merger Agreement in reliance upon such Stockholder’s execution, delivery and performance of this Agreement.

Section 2.02Representations and Warranties of Parent and Purchaser

Each of Parent and Purchaser, jointly and severally, hereby represents and warrants to each Stockholder as follows:

(a)Authorization; Validity of Agreement; Necessary Action.  Each of Parent and Purchaser is an entity duly organized, validly existing and in good standing under the laws of the state wherein it is formed.  Each of Parent and Purchaser has all requisite power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby.  The execution and delivery of this Agreement and the consummation by Parent and Purchaser of the transactions contemplated hereby have been duly authorized by all necessary action on the part of Parent and Purchaser.  This Agreement has been duly executed and delivere d by Parent and Purchaser and constitutes a valid and binding obligation of each of them, enforceable in accordance with its terms (except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and to general equity principles).

(b)No Conflicts

The execution and delivery of this Agreement by Parent and Purchaser does not, and the performance by each of them of its obligations under this Agreement will not, (i) conflict with or violate any Law applicable to Parent and Purchaser or by which any of their assets or properties is bound or (ii) conflict with, result in any breach of or constitute a default (or an event that with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, or require payment under, or result in the creation of any Lien on the properties or assets of Parent or Purchaser pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise or other instrument or obligation to which Parent or Purchaser is a party or by w hich Parent or Purchaser or any of their respective assets or properties is bound, except for any of the foregoing in (i) or (ii) above as could not reasonably be expected, either individually or in the aggregate, to materially impair the ability of Parent and Purchaser to perform their obligations hereunder or to consummate the transactions contemplated hereby on a timely basis.  The execution and delivery of this Agreement by Parent and Purchaser does not, and the performance of this Agreement by Parent and Purchaser will not, require any consent, approval, authorization or permit of, or filing with or notification to any (i) Governmental Authority, except for filings that may be required under the Exchange Act and the HSR Act or (ii) third party, except, in the case of (i) or (ii) above, as could not reasonably be expected, either individually or in the aggregate, to materially impair the ability of Parent and Purchaser to perform their obligations hereunder or to consummate the transa ctions contemplated hereby on a timely basis..

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ARTICLE 3

OTHER COVENANTS

Section 3.01(a) No Transfers

Each Stockholder hereby agrees, while this Agreement is in effect, and except as expressly contemplated hereby, not to, directly or indirectly (i) grant any proxies or enter into any voting trust or other agreement or arrangement with respect to the voting of any Shares or (ii) sell, transfer, pledge, encumber, assign, distribute, gift or otherwise dispose of (including by operation of law, other than by death of any person) (collectively, a “Transfer”) or enter into any contract, option or other arrangement or understanding with respect to any Transfer (whether by actual disposition or effective economic disposition due to hedging, cash settlement or otherwise) of, any of the Subject Shares, other securities of the Company owned beneficially or of rec ord as of the date hereof, any additional Shares and other securities of the Company acquired beneficially or of record by the Stockholder after the date hereof, or any interest therein. Such Stockholder shall not take any of the actions that the Company is prohibited from taking under Section 6.1 of the Merger Agreement.

Section 3.02Changes to Shares.  In case of a stock dividend or distribution, or any change in Shares by reason of any stock dividend or distribution, split-up, recapitalization, combination, exchange of shares or the like, the term “Shares” shall be deemed to refer to and include the Shares as well as all such stock dividends and distributions and any securities into which or for which any or all of the Shares may be changed or exchanged or which are received in such transaction.  Each Stockholder agrees, while this Agreement is in effect, to notify Parent promptly in writing of the number of any additional Shares or other securities of the Company acquired by such Stockholder, if any, after the date hereof.

Section 3.03No Inconsistent Arrangements.  Each Stockholder agrees, while this Agreement is in effect, (i) not to take, agree or commit to take any action that would reasonably be expected to make any representation or warranty of such Stockholder contained in this Agreement inaccurate in any respect as of any time during the term of this Agreement or (ii) to take all reasonable action necessary to prevent any such representation or warranty from being inaccurate in any respect at any such time.  Such Stockholder further agrees that it shall use commercially reasonable efforts to cooperate with Parent, as and to the extent reasonably reque sted by Parent, to effect the transactions contemplated hereby including the Offer and the Merger.

Section 3.04Appraisal Rights.  Such Stockholder hereby waives, and agrees not to exercise or assert, if applicable, any appraisal rights under Section 262 of the DGCL in connection with the Merger and to take all actions necessary to opt out of any class in any class action with respect to, any claim, derivative or otherwise, against the Company or any of its subsidiaries (or any of their respective successors) relating to the negotiation, execution and delivery of this Agreement or the Merger Agreement or the consummation of the Merger or any of the other transactions contemplated hereby or thereby.

Section 3.05Non-Solicitation. Between the date hereof and such time as this Agreement shall have been terminated in accordance with Section 4.03hereof,each Stockholder shall not, and shall not authorize or permit its Representatives to, directly or indirectly (i) initiate, solicit, or knowingly encourage or knowingly facilitate the submission of any inquiry, indication of interest, proposal or offer that constitutes, or would reasonably be expected to lead to, an Acquisit ion Proposal, (ii) participate in any discussions or negotiations regarding, or furnish any non-public information to any Person (other than Parent, Merger Sub or any designees of Parent or Merger Sub) in connection with, an Acquisition Proposal, (iii) enter into any letter of intent or agreement related to an Acquisition Proposal, or (iv) approve or recommend an Acquisition Proposal.

Section 3.06Documentation and Information. Each Stockholder (i) consents to and authorizes the publication and disclosure by Parent and its affiliates of its identity and holding of such Stockholder’s Subject Shares and the nature of its commitments and obligations under this Agreement in any announcement or disclosure required by the SEC or other Governmental Authority, the Offer Documents, or any other disclosure document in connection with the Offer, the Merger or any of the other transactions contemplated by the Merger Agreement or this Agreement, and (ii) agrees promptly to give to Parent any information it may reasonably require for the preparatio n of any such disclosure documents. Each Stockholder agrees to promptly notify Parent of any required corrections with respect to any written information supplied by it specifically for use in any such disclosure document, if and to the extent that any shall have become false or misleading in any material respect.

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ARTICLE 4

MISCELLANEOUS

Section 4.01Notices

                All notices and other communications hereunder shall be in writing and shall be deemed given if delivered to Parent and Purchaser in accordance with Section 10.3 of the Merger Agreement and to each Stockholder at its address set forth below such Stockholder’s signature hereto (or at such other address for a party as shall be specified by like notice).

Section 4.02Further Assurances

Each Stockholder shall, from time to time, execute and deliver, or cause to be executed and delivered, such additional or further consents, documents and other instruments as Parent or Purchaser may reasonably request for the purpose of effectively carrying out the transactions contemplated by this Agreement.

Section 4.03Termination

This Agreement shall terminate upon the earlier of (i) the termination of the Merger Agreement in accordance with its terms (ii) the Effective Time, (iii) the termination or expiration of the Offer, without any shares being accepted for payment thereunder, (iv) upon reduction of the Offer Price or (v)upon mutual written agreement of the parties to terminate this Agreement.  In the event of a termination of this Agreement pursuant to this Section 4.03, this Agreement shall become void and of no effect with no liability on the part of any party hereto; provided that the provisions of Article 4, but excluding Section 4.02, shal l survive the termination of this Agreement, and no such termination shall relieve any party hereto from any liability for any breach of this Agreement occurring prior to such termination.

Section 4.04Amendments and Waivers.

(a)The parties hereto may modify or amend this Agreement by written agreement executed and delivered by duly authorized officers of the respective parties.

(b)Any failure of any of the parties to comply with any obligation, covenant, agreement or condition herein may be waived by the party or parties entitled to the benefits thereof only by a written instrument signed by the party expressly granting such waiver, but such waiver or failure to insist upon strict compliance with such obligation, covenant, agreement or condition shall not operate as a waiver of, or estoppel with respect to, any subsequent or other failure.

Section 4.05Expenses

All costs and expenses incurred in connection with this Agreement shall be paid by the party incurring such costs and expenses, whether or not the transactions contemplated by this Agreement or the Merger Agreement are consummated.

Section 4.06Binding Effect; Benefit; Assignment

Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned by any of the parties hereto (whether by operation of law or otherwise) without the prior written consent of the other parties.  Subject to the preceding sentence, this Agreement will be binding upon, inure to the benefit of and be enforceable by the parties and their respective permitted successors and assigns.

Section 4.07Governing Law

This Agreement shall be governed by, and construed in accordance with the laws of the State of Delaware, without giving effect to any choice or conflict of laws provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of the Laws of any jurisdiction other than the State of Delaware.

6

Section 4.08Jurisdiction

Each of the parties hereto hereby (a) expressly and irrevocably submits to the exclusive personal jurisdiction of the Delaware Court of Chancery, any other court of the State of Delaware and any Federal court sitting in the State of Delaware in the event any dispute arises out of this Agreement, (b) agrees that such party will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court, (c) agrees that such party will not bring any action relating to this Agreement in any court other than the Delaware Court of Chancery, any other court of the State of Delaware or any Federal court sitting in the State of Delaware and (d) agrees that each of the other parties shall have the right to bring any action or proceeding for enforcement of a judgment entered by the Delaware Court of Chancery, any other court of the State of Delaware and any Federal court sitting in the State of Delaware.  Each of Parent, Purchaser and each Stockholder agrees that a final judgment in any action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Law.

Section 4.09Service of Process

Each party irrevocably consents to the service of process outside the territorial jurisdiction of the courts referred to in Section 4.08 hereof in any such action or proceeding by mailing copies thereof by registered or certified United States mail, postage prepaid, return receipt requested, to such party’s address as specified in or pursuant to Section 4.01 hereof.  However, the foregoing shall not limit the right of a party to effect service of process on the other party by any other legally available method.

Section 4.10Waiver of Jury Trial

EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY OR DISPUTE THAT MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.  EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (i) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (ii) EACH SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (iii) EACH SUCH PARTY MAKES THIS WAIVER VOLUNTARILY AND (iv) EACH SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS OF THIS SECTION.

Section 4.11Entire Agreement; Third Party Beneficiaries

.  This Agreement (a) constitutes the entire agreement and supersedes all prior agreements and understandings, both written and oral, among the parties with respect to the subject matter hereof and (b) is not intended to confer upon any Person other than the parties hereto any rights or remedies hereunder.

Section 4.12Severability

If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction or other authority to be invalid, void, unenforceable or against its regulatory policy, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated.

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Section 4.13Specific Performance

Each of the parties hereto acknowledges and agrees that, in the event of any breach of this Agreement, each nonbreaching party would be irreparably and immediately harmed and could not be made whole by monetary damages.  It is accordingly agreed that the parties hereto (a) will waive, in any action for specific performance, the defense of adequacy of a remedy at law and (b) shall be entitled, in addition to any other remedy to which they may be entitled at law or in equity, to compel specific performance of this Agreement in any action instituted in accordance with Section 4.08 hereof.

Section 4.14Stockholder Capacity

Notwithstanding any provision of this Agreement to the contrary, nothing in this Agreement shall (or shall require any Stockholder to attempt to) affect or limit any Stockholder who is a director or officer of the Company from acting in such capacity (it being understood that this Agreement shall apply to each Stockholder solely in each Stockholder’s capacity as a stockholder of the Company).

Section 4.15Stockholder Obligations Several and Not Joint

The obligations of each Stockholder hereunder shall be several and not joint and no Stockholder shall be liable for any breach of the terms of this Agreement by any other Stockholder.

Section 4.16Headings.  The Section headings contained in this Agreement are inserted for convenience only and shall not affect in any way the meaning or interpretation of this Agreement.

Section 4.17Interpretation.  Any reference to any national, state, local or foreign Law shall be deemed also to refer to all rules and regulations promulgated thereunder, unless the context otherwise requires. When a reference is made in this Agreement to Sections, such reference shall be to a Section to this Agreement unless otherwise indicated. Whenever the words “include,” “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation.”

Section 4.18No Presumption.  This Agreement shall be construed without regard to any presumption or rule requiring construction or interpretation against the party drafting or causing any instrument to be drafted.

Section 4.19Counterparts

This Agreement may be executed in multiple counterparts, all of which shall together be considered one and the same agreement.

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                IN WITNESS WHEREOF, the parties hereto have caused this Tender and Support Agreement to be duly executed as of the day and year first above written.

KENEXA CORPORATION
By:	// Nooruddin S. Karsan
	Name: Nooruddin S. Karsan
	Title: Chief Executive Officer

SPIRIT MERGER SUB, INC.
By:	/s/ Donald F. Volk
	Name: Donald F. Volk
	Title: President

9

IN WITNESS WHEREOF, the parties hereto have caused this Tender and Support Agreement to be duly executed as of the day and year first above written.

/s/ Bryce Chicoyne

Bryce Chicoyne

Notice Address:

(Notice address omitted)

/s/ G. Kent Plunkett

G. Kent Plunkett

Notice Address:

(Notice address omitted)

/s/ Yong Zhang

Yong Zhang

Notice Address:

(Notice address omitted)

/s/ Paul Daoust

Paul Daoust

Notice Address:

(Notice address omitted)

/s/ John Gregg

John Gregg

Notice Address:

(Notice address omitted)

/s/ Edward McCauley

Edward McCauley

Notice Address:

(Notice address omitted)

/s/ John Sumser

John Sumser

Notice Address:

(Notice address omitted)

/s/ Terry Temescu

Terry Temescu

Notice Address:

(Notice address omitted)

/s/ Robert Trevisani

Robert Trevisani

Notice Address:

(Notice address omitted)

/s/ William Martin

William Martin

Notice Address:

(Notice address omitted)

/s/ Teresa Shipp

Teresa Shipp

Notice Address:

(Notice address omitted)

/s/ Brent Kleiman

Brent Kleiman

Notice Address:

(Notice address omitted)

/s/ Judy Duff

Judy Duff

Notice Address:

(Notice address omitted)

/s/ Nicholas Camelio

Nicholas Camelio

Notice Address:

(Notice address omitted)

10

ANNEX I

Stockholder	Shares Beneficially Owned	Subject Shares Outstanding as of the date of this Agreement
Bryce Chicoyne	56,772	56,772
Paul R. Daoust	95,551	73,115
John F. Gregg	176,246	159,381
Terry Temescu	36,961	24,497
Yong Zhang	313,001	241,798
Robert A. Trevisani	85,256	62,231
William C. Martin	1,616,295	1,612,870
Edward F. McCauley	100,741	97,316
G. Kent Plunkett	2,997,378	2,457,792
John R. Sumser	66,612	49,747
Brent Kleiman	39,237	39,237
Teresa Shipp	195,275	148,083
Judy Duff	26,254	26,254
Nicholas Camelio	49,845	37,345

11

EX-10.1 4 ex10-1.htm CREDIT AGREEMENT

Exhibit 10.1

______________________________________________________________________________

CREDIT AGREEMENT

dated as of

August 31, 2010

among

KENEXA TECHNOLOGY, INC.

The Several Lenders From Time to Time

Parties Hereto,

PNC BANK, NATIONAL ASSOCIATION,

as Administrative Agent and Issuing Bank

____________________________________________________________________________

1

TABLE OF CONTENTS

	Page
SECTION 1. DEFINITIONS	5
1.1  Defined Terms	5
1.2  Other Definitional Provisions	18
SECTION 2. LOANS AND TERMS OF COMMITMENTS	19
2.1  Revolving Credit Commitments	19
2.2  Revolving Credit Notes	19
2.3  Procedure for Revolving Credit Loans	19
2.4  Letter of Credit Subfacility	20
2.5  Interest and Payment Dates	24
2.6  Default Interest	24
2.7  Conversion and Continuation Options; Limitations on Tranches	24
2.8  Commitment Fees	25
2.9  Termination and Reduction of Revolving Credit Commitments	25
2.10  Optional and Mandatory Prepayments of Loans	26
2.11  Illegality	27
2.12  Requirements of Law	27
2.13  Taxes	28
2.14  Indemnity	28
2.15  Treatment of Loans and Payments	29
2.16  Payments	29
2.17  Loan Accounts	29
2.18  Assignment of Loans and/or Revolving Credit Commitments Under Certain Circumstances; Duty to Mitigate	29
2.19  Use of Proceeds	29
SECTION 3. REPRESENTATIONS AND WARRANTIES	30
3.1  Corporate Existence	30
3.2  Subsidiaries	30
3.3  Authority and Binding Effect	30
3.4  Approvals	30
3.5  Recording and Enforceability	31
3.6  Litigation	31
3.7 Financial Information	31
3.8  Taxes	31
3.9  Intellectual Property	31
3.10  Intentionally Omitted	32
3.11  Material Agreements	32
3.12  Compliance With Law	32
3.13  Title to Property	32
3.14  Security Interests	32
3.15  Federal Regulations	33
3.16  ERISA	33
3.17  Fictitious Names	33
3.18  No Event of Default	33
3.19  Solvency	33
3.20  Investment Company Act	33
3.21  Environmental Matters	34
3.22  Labor Matters	34
3.23  Anti-Terrorism Laws	34
3.24  [INTENTIONALLY OMITTED]	35
3.25  No Burdensome Agreements	35
3.26  No Misrepresentations or Material Nondisclosures	35
SECTION 4. CONDITIONS PRECEDENT	36
4.1  Conditions to Closing	36
4.2  Conditions to Each Loan or Letter of Credit	37
4.3  Closing	37

2

TABLE OF CONTENTS

	Page
SECTION 5. AFFIRMATIVE COVENANTS	38
5.1  Furnishing Financial Statements	38
5.2  Books and Records	40
5.3  Taxes	40
5.4  Corporate Existence and Rights; Compliance with Laws	40
5.5  Maintenance of Properties	40
5.6  Performance and Compliance with Material Agreements	40
5.7  Insurance	40
5.8  Inspection; Collateral Audit	41
5.9  Leases and Mortgages	41
5.10  Pay Indebtedness and Perform Other Covenants	41
5.11 Notices	41
5.12  Deposit Accounts	42
5.13  ERISA	42
5.14  Environmental Laws	42
5.15  Notice and Joinder of New Subsidiaries	43
5.16  Anti-Terrorism Laws	43
SECTION 6. NEGATIVE COVENANTS	44
6.1  Financial Covenants	44
6.2  Limitation on Indebtedness	44
6.3  Limitation on Liens	45
6.4  Limitations on Fundamental Changes	46
6.5  Limitations on Sale of Assets	46
6.6  Limitations on Acquisitions and other Investments	47
6.7  Limitation on Distributions	47
6.8  Transactions with Affiliates	47
6.9  Sale on Leaseback	47
6.10  Continuation of or Change in Business	47
6.11  Limitation on Negative Pledge	47
6.12  Limitation on Optional Prepayment of Indebtedness	48
6.13  Use of Proceeds	48
6.14  Fiscal Year	48
6.15  Clauses Restricting Subsidiary Distributions	48
6.16  Limitation on Activities of the Parent	48
6.17 No Misrepresentations or Material Nondisclosure	48
6.18  Kenexa SA PTE Ltd. (South Africa)	48
SECTION 7.  EVENTS OF DEFAULT	49
7.1  Events of Default	49
7.2  Remedies	50
SECTION 8.  THE ADMINISTRATIVE AGENT	51
8.1  Appointment	51
8.2  Delegation of Duties	51
8.3  Exculpatory Provisions	51
8.4  Reliance by Administrative Agent	51
8.5  Notice of Default	51
8.6  Non-Reliance on Administrative Agent and Other Lenders	52
8.7  Indemnification	52
8.8 Administrative Agent in Its Individual Capacity	52
8.9  Release of Liens	52
8.10  Successor Administrative Agent	52
8.11  USA Patriot Act	52
8.12  Beneficiaries	52

3

TABLE OF CONTENTS

	Page
SECTION 9. MISCELLANEOUS	53
9.1  Amendments and Waivers	53
9.2  Notices	54
9.3  No Waiver; Cumilative Remedies	55
9.4  Survival of Representations and Warranties	55
9.5  Payment of Expenses and Taxes	55
9.6  Successort and Assigns	56
9.7  Adjustments; Set-off	57
9.8  Counterparts	57
9.9  Severability	57
9.10  Integration	57
9.11 GOVERNING LAW	57
9.12  Confidentiality	57
9.13  Submission To Jurisdiction; Waivers	58
9.14  Acknowledgements	58
9.15  USA PATRIOT ACT	58
9.16  WAIVERS OF JURY TRIAL	58

4

CREDIT AGREEMENT

THIS CREDIT AGREEMENT, dated as of August 31, 2010, is among KENEXA TECHNOLOGY, INC., a Pennsylvania corporation (the “Borrower”), the several banks and other financial institutions from time to time parties hereto (individually, a “Lender” or “Revolving Credit Lender”; collectively, the “Lenders” or the “Revolving Credit Lenders”) and PNC BANK, NATIONAL ASSOCIATION, as Administrative Agent (in such capacity, the “Administrative Agent”).

W I T N E S S E T H:

In consideration of the premises and other valuable consideration, the receipt and adequacy of which are hereby acknowledged, and with the intent to be legally bound hereby, the parties hereto agree as follows:

SECTION 1.  DEFINITIONS

1.1Defined Terms

.  As used in this Agreement, the following terms shall have the following meanings:

“Accumulated Funding Deficiency”:  any accumulated funding deficiency as defined in Sections 302(a) of ERISA and 412(a) of the Code prior to the amendment by the Pension Protection Act of 2006.

“Adjusted Funding Target Attainment Percentage”:  an adjusted target attainment percentage as defined in Sections 206(g)(9) of ERISA and 436(j) of the Code.

“Administrative Agent”:  as defined in the Preamble hereto, and its successors in such capacity appointed pursuant to Section 8.10.

“Affiliate”:  as to any Person, any other Person which, directly or indirectly, through one or more intermediaries, controls, or is controlled by, or is under common control with, such Person and any member, partner, director, officer or employee of any such Person.  For purposes of this definition, “control” shall mean the power, directly or indirectly, either to (a) vote 10% or more of the Capital Stock of such Person, (b) vote 10% or more of the securities having ordinary voting power for the election of directors of such Person or (c) direct or in effect cause the direction of the management and policies of such Person whether by contract or otherwise.

“Agreement”:  this Credit Agreement, as amended, supplemented or otherwise modified from time to time.

“Anti-Terrorism Laws”:  any laws relating to terrorism or money laundering, including Executive Order No. 13224 and the USA Patriot Act.

“Application”:  in respect of each Letter of Credit issued by the Issuing Bank, an application, in such form as the Issuing Bank may specify from time to time, requesting issuance of such Letter of Credit, as it may be amended, supplemented or modified from time to time.

“Asset Sale”:  as defined in subsection 2.10(c).

“Assignment and Assumption”:  an assignment and assumption entered into by a Lender and a Purchasing Lender in accordance with and subject to the terms and conditions of Section 9.6, substantially in the form of Exhibit D attached hereto, or such other form as shall be approved by the Administrative Agent, as it may be amended, supplemented or modified from time to time.

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“Base Rate”: for any day, a fluctuating per annum rate of interest equal to the highest of (a) the Prime Rate in effect on such day, (b) the Federal Funds Open Rate in effect on such day plus ½ of 1% and (c) the Daily LIBOR Rate in effect on such day plus one hundred basis points (1.00%).  If for any reason the Administrative Agent shall have determined (which determination shall be conclusive absent manifest error) that it is unable to ascertain the Federal Funds Open Rate or the Daily LIBOR Rate for any reason, the Base Rate shall be determined without regard to clause (b) or (c) as the case may be, of the first sentence of this definition until the circumstances giving rise to such inability no longer exist.  Any change in the Base Rate due to a change in the Prime Rate, the Federal Funds Open Rate or the Daily LIBOR Rate shall be effective on the effective date of such change in the Prime Rate, the Federal Funds Open Rate or the Daily LIBOR Rate,  respectively.

“Base Rate Borrowing”:  a Borrowing comprised of Base Rate Loans.

“Base Rate Loans”:  any Loan bearing interest at a rate determined by reference to the Base Rate.

“Borrower”:  as defined in the Preamble hereto.

“Borrowing”:  each group of Loans of a single Type made by the Lenders on a single date and, in the case of Eurodollar Loans, as to which a single Interest Period is in effect.

“Borrowing Availability”:  at any particular time, an amount equal to the excess, if any, of (a) the aggregate Revolving Credit Commitments of the Revolving Credit Lenders at such time over (b) the aggregate Revolving Credit Exposure of the Revolving Credit Lenders at such time.

“Borrowing Date”:  any Business Day on which a Loan is to be made at the request of the Borrower under this Agreement.

“Budget”: as defined in subsection 5.1(i).

“Business Day”:  a day other than a Saturday, Sunday or other day on which commercial banks in Pittsburgh or Philadelphia, Pennsylvania, are authorized or required by law or other governmental action to close and if the applicable Business Day relates to any Eurodollar Loan, such day must also be a day on which dealings are carried on in the London interbank market.

“Capital Expenditures”:  any expenditure of the Parent or any Subsidiary of the Parent which would be classified as a capital expenditure in accordance with GAAP.

“Capital Lease”:  at any time, a lease with respect to which the lessee is required to recognize the acquisition of an asset and the incurrence of a liability in accordance with GAAP.

“Capital Lease Obligations”:  at any time, the amount of the obligations under Capital Leases which would be shown at such time as a liability on a consolidated balance sheet of the Parent and its consolidated Subsidiaries prepared in accordance with GAAP.

“Capital Stock”:  any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all partnership interests in a partnership (general or limited), any and all equivalent ownership interests in a Person (other than a corporation or partnership), including interests in a limited liability company, and any and all warrants or options to purchase any of the foregoing.

“Cash Equivalents”:  (a) securities with maturities of 90 days or less from the date of acquisition issued or fully guaranteed or insured by the United States or any agency thereof, (b) certificates of deposit with maturities of 90 days or less from the date of acquisition and overnight bank deposits of any commercial bank having capital, surplus and undivided profits aggregating at least $500,000,000, (c) repurchase obligations of any commercial bank satisfying the requirements of clause (b) of this definition, (d) commercial paper of a domestic issuer rated at least A-2 or better by S&P or P-2 or better by Moody’s and in either case maturing within 90 days after the date of acquisition, (e) securities with maturitie s of 90 days or less from the date of acquisition issued or fully guaranteed by any state, commonwealth or territory of the United States or by any political subdivision or taxing authority of any such state, commonwealth or territory, and such securities of such state commonwealth, territory, political subdivision or taxing authority, as the case may be, are rated at least A by S&P or A by Moody’s, (f) securities with maturities of 90 days or less from the date of acquisition backed by standby letters of credit issued by any commercial bank satisfying the requirements of clause (b) of this definition, or (g) shares of “money market funds” within the meaning of Rule 2a-7 of the Investment Company Act of 1940, as amended.

“Change of Control”:  any transaction or occurrence or series of transactions or occurrences which results at any time in:

(a)any Person or group of Persons (within the meaning of Sections 13(d) or 14(a) of the Securities Exchange Act of 1934, as amended) shall have acquired, after the Closing Date, beneficial ownership of (within the meaning of Rule 13d-3 promulgated by the SEC under said Act) 30.00% or more of the voting Capital Stock of the Parent;

(b)within a period of twelve (12) consecutive calendar months, individuals who were directors of the Parent on the first day of such period (together with any new directors whose election by the board of directors of the Parent or whose nomination for election by the shareholders of the Parent was approved by a vote of a majority of the directors then still in office who were either directors as of the first day of such period or whose election or nomination for election was previously so approved) shall cease to constitute a majority of the board of directors of the Parent; or

(c)the Parent ceasing to own, whether directly or indirectly, beneficially and of record less than one hundred percent (100%) of each class of Capital Stock of the Borrower and any other Subsidiary of the Parent formed in connection with a Permitted Acquisition.

“Closing” and “Closing Date”:  as defined in Section 4.3.

“Code”:  the Internal Revenue Code of 1986, as amended from time to time.

“Collateral”:  all property of the Parent, Borrower and the other Loan Parties which is at the time subject to the Lien of any of the Security Documents in favor of the Administrative Agent for the benefit of the holders of the Obligations.

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“Commitment Fees”:  as defined in Section 2.8.

“Commonly Controlled Entity”:  an entity, whether or not incorporated, which is under common control with the Parent within the meaning of Section 4001 of ERISA or is part of a group which includes the Parent and which is treated as a single employer under Section 414(b), (c), (m) or (o) of the Code.

“Compliance Certificate”:  as defined in subsection 5.1(c).

“Consideration”:  with respect to any acquisition, the consideration paid or proposed to be paid by the Parent and its Subsidiaries with respect to such acquisition (including earnouts, payments under non-compete arrangements and any assumption of Indebtedness).

“Contractual Obligation”:  as to any Person, any provision of any security issued by such Person or any provision of any agreement, instrument or other undertaking to which such Person is a party or by which it or any of its property is bound.

“Daily LIBOR Rate”: for any day, the rate per annum determined by the Administrative Agent by dividing (the resulting quotient rounded upwards, if necessary, to the nearest 1/100th of 1%) (a) the Published Rate by (b) a number equal to 1.00 minus the Eurocurrency Reserve Percentage.  The Published Rate shall be adjusted as of each Business Day based on changes in the Published Rate or the Eurocurrency Reserve Percentage without notice to the Borrower, and shall be applicable from the effective date of any such change.

“Default”:  any of the events specified in Section 7.1, whether or not any requirement for the giving of notice, the lapse of time, or both, or any other condition precedent therein set forth, has been satisfied.

“Default Rate”:  as defined in Section 2.6.

“Distribution”:  in respect of any Capital Stock of any Person (a) dividends or other distributions on such Capital Stock (except distributions in other Capital Stock of such Person) and (b) the redemption or acquisition of such Capital Stock or of warrants, rights or other options to purchase such Capital Stock (except when solely in exchange for Capital Stock of such Person), including, without limitation, any payments on or in respect of any redeemable preferred stock of such Person.

“Dollars” and “$”:  dollars in lawful currency of the United States of America.

“Domestic Subsidiary”:  any Subsidiary other than a Foreign Subsidiary.

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“EBITDA”:  for any period, net income (excluding (i) non-cash equity compensation expenses and (ii) interest income, in each case for such period), plus, to the extent deducted from such net income, the sum of (a) gross interest expense, (b) income taxes, and (c) depreciation and amortization, all as determined for the Parent and its Subsidiaries on a consolidated basis in accordance with GAAP and without duplication; provided that, if at any time during such period the Parent or any of its Subsidiaries shall have sold or otherwise divested any material assets or stock in any Subsidiary, any book gai n or loss resulting from such sale or other divestiture, together with the net income or loss of such Subsidiary or attributable to such assets shall also be excluded from net income.  As used in the definitions of Modified EBITDA and Permitted Acquisition, EBITDA shall also be determined for any Person who has (or whose assets have) been acquired by a Loan Party to the extent provided in such definition.

“Employee Pension Plan”:  any pension plan which (a) is maintained by the Parent or any Affiliate and (b) is subject to Part 3 of Title I of ERISA.

“Environmental Laws”:  any and all Federal, state, local, municipal or foreign laws, rules, orders, regulations, statutes, ordinances, codes, decrees or binding requirements of any Governmental Authority, or binding Requirement of Law regulating, relating to or imposing liability or standards of conduct concerning protection of the environment, as now or may at any time hereafter be in effect.

“ERISA”:  the Employee Retirement Income Security Act of 1974, as amended, and any regulations issued thereunder by the Department of Labor or PBGC.

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

“Eurodollar Borrowing”:  a Borrowing comprised of Eurodollar Loans.

“Eurodollar Loan”:  any Loan bearing interest at a rate determined by reference to the Eurodollar Rate in accordance with the provisions of Section 2.

“Eurodollar Rate”:  with respect to the Loans comprising any Eurodollar Borrowing for any Interest Period, the interest rate per annum determined by the Administrative Agent by dividing (the resulting quotient rounded upwards, if necessary, to the nearest 1/100th of 1% per annum) (a) the rate which appears on the Bloomberg Page BBAM1 (or on such other substitute Bloomberg page that displays rates at which US dollar deposits are offered by leading banks in the London interbank deposit market), or the rate which is quoted by another source selected by the Administrative Agent which has been approved by the British Bankers’ Association as an authorized information ve ndor for the purpose of displaying rates at which US dollar deposits are offered by leading banks in the London interbank deposit market (for purposes of this definition, an “Alternate Source”), at approximately 11:00 a.m., London time, two (2) Business Days prior to the commencement of such Interest Period as the London interbank offered rate for U.S. Dollars for an amount comparable to such Eurodollar Borrowing and having a borrowing date and a maturity comparable to such Interest Period (of if there shall at any time, for any reason, no longer exist a Bloomberg Page BBAM1 (or any substitute page) or any Alternate Source, a comparable replacement rate determined by the Administrative Agent at such time (which determination shall be conclusive absent manifest error)), by (b) a number equal to 1.00 minus the Eurocurrency Reserve Percentage.  The Eurodollar Rate may also be expressed by the following formula:

Eurodollar Rate = London interbank offered rates quoted by Bloomberg

or appropriate successor as shown on Bloomberg Page BBAM1

1.00 - Eurocurrency Reserve Percentage

The Eurodollar Rate shall be adjusted with respect to any Eurodollar Borrowing that is outstanding on the effective date of any change in the Eurocurrency Reserve Percentage as of such effective date.  The Administrative Agent shall give prompt notice to the Borrower of the Eurodollar Rate as determined or adjusted in accordance herewith, which determination shall be conclusive absent manifest error.

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“Event of Default”:  any of the events specified in Section 7, provided that any requirement for the giving of notice, the lapse of time, or both, or any other condition, has been satisfied.

“Excluded Taxes”:  with respect to the Administrative Agent, any Lender, any Issuing Bank or any other recipient of any payment to be made by or on account of any obligation of Borrower hereunder (a) income or franchise taxes imposed on (or measured by) its net income by the United States of America, or by the jurisdiction under the laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable lending office is located, (b) any branch profits taxes imposed by the United States of America or any similar tax imposed by any other jurisdiction in which Borrower is located and (c) in the case of a Foreign Lender (other than an assignee pursuant to a request by Borr ower under Section 2.18), any withholding tax that is imposed on amounts payable to such Foreign Lender at the time such Foreign Lender becomes a party to this Agreement (or designates a new lending office) or is attributable to such Foreign Lender’s failure to comply with subsection 2.13(b), 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 Borrower with respect to such withholding tax pursuant to Section 2.13.

“Executive Order No. 13224”:  Executive Order No. 13224 on Terrorist Financing, effective September 24, 2001, as the same has been, or shall hereafter be, renewed, extended, amended or replaced.

“Existing Letters of Credit”:  those letters of credit issued by PNC which are outstanding on the Closing Date.  A list of the Existing Letters of Credit is set forth on Schedule III.

“Fee Letter”:  the commitment letter dated as of August 4, 2010, signed by the Borrower and PNC.

“Federal Funds Effective Rate”:  for any day, the rate per annum (based on a year of three hundred sixty (360) days and actual days elapsed and rounded upward to the nearest 1/100 of one percent (1%)) announced by the Federal Reserve Bank of New York (or any successor) on such day as being the weighted average of the rates on overnight federal funds transactions arranged by federal funds brokers on the previous trading day, as computed and announced by such Federal Reserve Bank (or any successor) in substantially the same manner as such Federal Reserve Bank computes and announces the weighted average it refers to as the “Federal Funds Effective Rate” as of the date of this Agreement; provided, if such Federal Reserve Bank (or its successor) does not announce such rate on any day, the “Federal Funds Effective Rate” for such day shall be the Federal Funds Effective Rate for the last day on which such rate was announced.

“Federal Funds Open Rate”:  for any day, the rate per annum (based on a year of 360 days and actual days elapsed) which is the daily federal funds open rate as quoted by ICAP North America, Inc. (or any successor) as set forth on the Bloomberg Screen BTMM for that day opposite the caption “OPEN” (or on such other substitute Bloomberg Screen that displays such rate), or as set forth on such other recognized electronic source used for the purpose of displaying such rate as selected by the Administrative Agent (an “Alternate Source”) (or if such rate for such day does not appear on the Bloomberg Screen BTMM (or any substitute screen) or on any Alternate Source, or if there shall at any time, for any reason, no longer exist a Bloomberg Screen BTMM (or any substitute screen) or any Alternate Source, a comparable replacement rate determined by the Administrative Agent at such time (which determination shall be conclusive absent manifest error); provided however, that if such day is not a Business Day, the Federal Funds Open Rate for such day shall be the “open” rate on the immediately preceding Business Day.

“Foreign Benefit Event”:  with respect to any Foreign Pension Plan, (a) the existence of unfunded liabilities in excess of the amount permitted under any applicable law, or in excess of the amount that would be permitted absent a waiver from a Governmental Authority, (b) the failure to make the required contributions or payments, under any applicable law, on or before the due date for such contributions or payments, (c) the receipt of a notice of a Governmental Authority relating to the intention to terminate any such Foreign Pension Plan or to appoint a trustee or similar official to administer any such Foreign Pension Plan or alleging the insolvency of any such Foreign Plan, (d) the incurrence of any liability in excess of $250,00 0 in the aggregate by the Parent and its Subsidiaries under applicable law and on account of the complete or partial termination of such Foreign Pension Plan or the complete or partial withdrawal of any participating employer therein, or (e) the occurrence of any transaction that is prohibited under any applicable law and that would reasonably be expected to result in the incurrence of any liability by the Parent and its Subsidiaries or the imposition on the Parent and its Subsidiaries of any fine, excise tax or penalty resulting from any noncompliance with any applicable law, in each in excess of in the aggregate $250,000.

“Foreign Lender”:  any Lender that is not organized under the laws of the United States of America, any State thereof or the District of Columbia.

“Foreign Pension Plan”:  any benefit plan maintained by a Foreign Subsidiary that under applicable law is required to be funded through a trust or other funding vehicle other than a trust or funding vehicle maintained exclusively by a Governmental Authority.

“Foreign Subsidiary”:  any Subsidiary not organized under the laws of the United States of America, any State thereof or the District of Columbia.

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“GAAP”:  at any time with respect to the determination of the character or amount of any asset or liability or item of income or expense, or any consolidation or other accounting computation, generally accepted accounting principles as in effect in the United States on the date of, or at the end of the period covered by, the financial statements from which such asset, liability, item of income, or item of expense, is derived, or, in the case of any such computation, as in effect on the date when such computation is required to be determined, consistently applied.

“Governmental Acts”:  as defined in subsection 2.4(j).

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

“Guarantor”:  the Parent and each Subsidiary of the Parent now or hereafter executing and delivering a Guaranty.  The initial Guarantors shall be the Parent, Kenexa Government Solutions, Inc., Kenexa Strategic Outsourcing Corporation, Devon Royce, Inc., Nextworx, Inc., Kenexa Recruiter, Inc. and Kenexa BrassRing, Inc.

“Guaranty”:  a Guaranty and Suretyship Agreement delivered to the Administrative Agent by a Guarantor substantially in the form of Exhibit C hereto, as the same may be amended, supplemented or otherwise modified from time to time.

“Guaranty Obligation”:  as to any Person, any guarantee of payment or performance by such Person of any Indebtedness or other obligation of any other Person, or any agreement to provide financial assurance with respect to the financial condition, or the payment of the obligations of, such other Person (including, without limitation, purchase or repurchase agreements, reimbursement agreements with respect to letters of credit or acceptances, indemnity arrangements, grants of security interests to support the obligations of another Person, keepwell agreements and take-or-pay or through-put arrangements) which has the effect of assuring or holding harmless any third Person against loss with respect to one or more obligations of such third Person; provided, however, the term Guaranty Obligation shall not include endorsements of instruments for deposit or collection in the ordinary course of business.  The amount of any Guaranty Obligation of any Person shall be deemed to be the lower of (a) an amount equal to the stated or determinable amount of the primary obligation in respect of which such Guaranty Obligation is made and (b) the maximum amount for which such contingently liable Person may be liable pursuant to the terms of the instrument embodying such Guaranty Obligation, unless the maximum amount is not stated or determinable, in which case the amount of such Guaranty Obligation shall be such contingently liable Person’s maximum reasonably anticipated liability in respect thereof as determined by such Person in good faith and approved by the Administrative Agent.  Guaranty Obligations of any Person shall include the amount of any future “earn-out” or similar payments to be made to any other Person in connection with a Permitted Acquisition to the extent included in accordance with GAAP as a liability on the balance sheet of such Person.

“Hedge Agreement”:  any (a) interest rate swap agreement, interest rate cap agreement, interest rate floor agreement, interest rate collar agreement, interest rate option or any other agreement regarding the hedging of interest rate risk exposure executed in connection with hedging the interest rate exposure of any Person and any confirming letter executed pursuant to such agreement and (b) a foreign exchange contract, currency swap agreement, futures contract, option contract, synthetic cap or any other agreement regarding the hedging of fluctuations of currency values and any confirming letter executed pursuant to such agreement, all as amended, restated, supplemented or otherwise modified from time to time.

“Indebtedness”:  of any Person at any date, without duplication:

(a)all indebtedness of such Person for borrowed money or for the deferred purchase price of property or services (other than trade liabilities incurred in the ordinary course of business not more than 60 days overdue (or being contested in good faith) and payable in accordance with customary practices), including seller’s notes and to the extent included as a liability on the balance sheet of such Person in accordance with GAAP, earn-outs and similar obligations,

(b)any other indebtedness which is evidenced by a note, bond, debenture or similar instrument,

(c)all Capital Lease Obligations of such Person,

(d)all reimbursement and other obligations of such Person in respect of letters of credit, bankers’ acceptances and similar obligations created for the account of such Person, in each case whether or not matured,

(e)all liabilities secured by any Lien on any property owned by such Person even though such Person has not assumed or otherwise become liable for the payment thereof,

(f)all liabilities with respect to redeemable preferred stock obligations arising prior to the Revolving Credit Termination Date,

(g)net liabilities of such Person under any Hedge Agreements, foreign currency exchange agreements, netting agreements and other hedging agreements or arrangements (calculated on a basis satisfactory to the Administrative Agent and in accordance with accepted practice),

(h)withdrawal liabilities of such Person or any Commonly Controlled Entity under a Plan or withdrawal liabilities of such Person under a Foreign Pension Plan, and

(i)all Guaranty Obligations of such Person with respect to liabilities of a type described in any of clauses (a) through (h) of this definition.

The Indebtedness of any Person shall include any Indebtedness of any partnership in which such Person is the general partner.

“Insolvency”:  with respect to any Multiemployer Plan, the condition that such Plan is insolvent within the meaning of Section 4245 of ERISA.

“Insolvent”:  pertaining to a condition of Insolvency.

“Intellectual Property”:  has the meaning ascribed thereto in Section 3.9.

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“Interest Coverage Ratio”:  as of the last day of any fiscal quarter, the ratio of (a) EBITDA less Capital Expenditures to (b) gross cash interest expense, in each case determined for the Parent and its Subsidiaries on a consolidated basis for the period of four (4) consecutive fiscal quarters ending on such date.

“Interest Payment Date”:  (a) as to any Base Rate Loan, each January 1, April 1, July 1 and October 1, (b) as to any Eurodollar Loan having an Interest Period of three months or less, the last day of such Interest Period, (c) as to any Eurodollar Loan having an Interest Period longer than three months, each day which is three months, or a whole multiple thereof, after the first day of such Interest Period and the last day of such Interest Period, and (d) as to any Revolving Credit Loan, in addition to the foregoing, the Revolving Credit Termination Date.

“Interest Period”:  with respect to any Eurodollar Loan:

(a)initially the period commencing on the borrowing or conversion date, as the case may be, with respect to such Eurodollar Loan and ending one, two, three or six months thereafter, as selected by the Borrower in its notice of borrowing or notice of conversion, given with respect thereto; and

(b)thereafter, each period commencing on the last day of the next preceding Interest Period applicable to such Eurodollar Loan and ending one, two, three or six months thereafter, as selected by the Borrower by irrevocable notice to the Administrative Agent not less than three Business Days prior to the last day of the then current Interest Period with respect thereto;

provided that, the foregoing provisions relating to Interest Periods are subject to the following:

(i)if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day;

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

(iii)with respect to Eurodollar Loans that are Revolving Credit Loans, an Interest Period that otherwise would extend beyond the Revolving Credit Termination Date shall end on the Revolving Credit Termination Date; and

(iv)the Borrower shall select Interest Periods so as not to require a payment or prepayment of any Eurodollar Loan during an Interest Period for such Loan.

“Investments”:  investments (by loan or extension of credit, purchase, advance, guaranty, capital contribution or otherwise) made in cash or by delivery of Property, by any of the Parent or any Subsidiary (a) in any Person, whether by acquisition of stock or other ownership interest, indebtedness or other obligation or Security, or by loan, advance or capital contribution or (b) in any Property.

“ISP98”:  as defined in Section 2.4(a).

“Issuing Bank”:  PNC, in its capacity as issuer of Letters of Credit, and any successor thereto.

“Joinder”:  a Joinder Agreement in a form acceptable to the Administrative Agent pursuant to which a Subsidiary of the Parent shall join the applicable Loan Documents pursuant to Section 5.15, as amended, supplemented or otherwise modified from time to time.

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“Law”:  any law (including common law), constitution, statute, treaty, regulation, rule, ordinance, opinion, release, ruling, order, injunction, writ, decree or award of any Governmental Authority.

“L/C Disbursement”: a payment or disbursement made by the Issuing Bank pursuant to a Letter of Credit.

“L/C Sublimit”:  $2,000,000

“Lender”:  as defined in the Preamble hereto and any other Person that becomes a Lender hereunder by reason of an Assignment and Assumption.

“Letter of Credit Coverage Requirement”:  with respect to each Letter of Credit at any time, 102% of the maximum amount available to be drawn thereunder at such time (determined without regard to whether any conditions to drawing could be met at such time).

“Letter of Credit Fee”:  has the meaning assigned to that term in subsection 2.4(b).

“Letter of Credit Obligations”:  at any time, an amount equal to the sum of (a) 100% of the maximum amount available to be drawn under all Letters of Credit outstanding at such time (determined without regard to whether any conditions to drawing could be met at such time) and (b) the aggregate amount of drawings under Letters of Credit which have not then been reimbursed pursuant to subsection 2.4(d)(i).

“Letter of Credit Participant”:  in respect of each Letter of Credit, each Lender (other than the Issuing Bank) in its capacity as the holder of a participating interest in such Letter of Credit.

“Letters of Credit”:  collectively, the Existing Letters of Credit and any letters of credit issued by the Issuing Bank under Section 2.4, as amended, supplemented, extended or otherwise modified from time to time.

“Lien”:  any mortgage, deed of trust, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge or other security interest or any preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever (including, without limitation, any conditional sale or other title retention agreement and any capital lease having substantially the same economic effect as any of the foregoing).

“Liquidity Level”:  at any particular time, an amount equal to the sum of the Borrowing Availability and cash and Cash Equivalents maintained in Unrestricted Investment Accounts as determined for the Parentand its Subsidiaries on a consolidated basis in accordance with GAAP.

“Loan Documents”:  the collective reference to this Agreement, the Revolving Credit Notes, the Security Documents, the Applications, the Letters of Credit, the Joinders, the Fee Letter and any Subordination Agreement(s) hereinafter entered into, and all other documents, instruments, agreements or certificates delivered in connection herewith, in each case as amended, supplemented or otherwise modified.

“Loan Parties”:  the Borrower, the Parent and each of their Subsidiaries that is party to a Loan Document.

“Loans”:  as defined in Section 2.1.  Each Loan shall be either a Eurodollar Loan or a Base Rate Loan.

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“Material Adverse Effect”:  a material adverse effect on (a) the validity or enforceability of this Agreement or any other Loan Document, (b) the business, Property, assets, financial condition or results of operations of the Parent and its Subsidiaries taken as a whole, (c) the ability of the Parent and its Subsidiaries to duly and punctually to pay their debts as they come due and to perform their obligations under the Loan Documents, or (d) the ability of the Administrative Agent and the Lenders to enforce their legal remedies pursuant to this Agreement or any other Loan Document.

“Material Recovery Event”:  the receipt by the Parent or any of its Subsidiaries of property, casualty or condemnation award proceeds in excess of $1,000,000.

“Materials of Environmental Concern”:  any gasoline or petroleum (including crude oil or any fraction thereof) or petroleum products or any hazardous or toxic substances, pollutants, contamination, materials or wastes, defined or regulated as such in or under any Environmental Law, including, without limitation, asbestos, polychlorinated biphynels, and ureaformaldehyde insulation.

“Merger”:  the merger of Spirit Merger Sub with and into Salary.com under the terms of the Merger Agreement.

“Merger Agreement”: the Agreement and Plan of Merger by and among Kenexa Corporation, Spirit Merger Sub and Salary.com dated as of August 31, 2010, as it may be amended, restated or modified from time to time.

“Modified EBITDA”:  for any period of four consecutive fiscal quarters (each a “Reference Period”), EBITDA for such Reference Period; provided that, if at any time during such Reference Period, the Parent or any of its Subsidiaries shall have acquired the stock or assets of any Person in a Permitted Acquisition, then so long as (a) the Lenders shall have received audited financial statements for the prior two (2) years prepared on a GAAP basis or an independent third-party due diligence report for such Person from a nationally recognized accounting firm or other nationally recognized firm reasonably acceptable to the Administrative Agent, (b) the Person who is being acquired or who will own the assets being acquired is (or shall, upon closing of such acquisition, become) a Guarantor, unless such Person is a Foreign Subsidiary, and (c) the Borrower complies with Section 5.15 hereof, Modified EBITDA shall include (i) the historical EBITDA of such Person or attributable to such assets for the period from the beginning of such Reference Period to the day immediately preceding the closing date of such Permitted Acquisition and (ii) such adjustments to such actual EBITDA as shall be determined by the Required Lenders in their sole discretion; provided, that, if audited financial statements or third-party due diligence report have not been provided to the Lenders, (I) the historical EBITDA, if positive, of such Person or attributable to such assets shall not be included in the calculation of Modified EBITDA, unless consented to i n writing by the Required Lenders in their sole discretion and (II) the historical EBITDA, if negative, of such Person or attributable to such assets shall be included in the calculation of Modified EBITDA, unless the Required Lenders in their sole discretion elect otherwise.

“Moody’s”:  Moody’s Investors Services, Inc.

“Multiemployer Plan”:  a Plan which is a multiemployer plan as defined in Section 4001(a)(3) of ERISA and to which the Parent or its Subsidiaries, or a Commonly Controlled Entity of any of the foregoing, is making or is obligated to make contributions, or has made, or been obligated to make, contributions.

“Net Proceeds”:  (a) with respect to the sale or issuance after the Closing Date of any Capital Stock of the Parent or the incurrence of additional Indebtedness for borrowed money by the Parent or any Subsidiary thereof, the amount equal to (i) the aggregate amount received in cash in connection with such sale or issuance or incurrence minus (ii) the reasonable fees, commissions and other out-of-pocket expenses incurred by the Parent or such Subsidiary in connection with such sale or issuance or incurrence, (b) with respect to any Asset Sale, the amount equal to (i) the aggregate amount received in cash (including any cash received by way of deferred payment pursuant to a note receivable, other non-cash consideration or otherwi se, but only as and when such cash is so received) in connection with such Asset Sale minus (ii) the sum of (I) the principal amount of Indebtedness which is secured by the asset that is the subject of such Asset Sale (other than Indebtedness assumed by the purchaser of such asset) and which is required to be, and is, repaid in connection with such Asset Sale (other than Indebtedness hereunder), (II) the reasonable fees, commissions, income taxes and other out-of-pocket expenses incurred by the Parent or such Subsidiary in connection with such Asset Sale and (III) amounts established as a reserve, reasonably established by the Parent or its Subsidiaries (in accordance with GAAP), against liabilities under any indemnification obligations associated with such Asset Sale or other liabilities retained by the Parent and its Subsidiaries associated with the properties sold pursuant to such Asset Sale (provided that, to the extent and at the time such amounts are released from such reserve, such amounts shall constitute Net Proceeds), and (c) with respect to any Material Recovery Event, the amount equal to (i) the aggregate amount of the property, casualty or condemnation award proceeds received by the Parent or any Subsidiary in connection with such Material Recovery Event minus (ii) the reasonable fees and other out-of-pocket expenses incurred by the Parent and its Subsidiaries in connection with recovering such proceeds.

“Non-Loan Party”:  any Subsidiary of the Parent other than a Guarantor.  The Non-Loan Parties as of the Closing Date are (a) Kenexa Technology Canada Inc., BrassRing Canada, Inc, Kenexa BrassRing Holdings BV, Kenexa BrassRing Ltd, Kenexa BrassRing GmbH, Kenexa BrassRing Asia Pacific Ltd., Kenexa BrassRing BV, Kenexa Limited, Kenexa Technologies Private Limited, Kenexa Technologies Sdn. Bhd., Kenexa Puerto Rico Inc., Kenexa Argentina SRL, Kenexa International Limited, Kenexa SA Pte. Ltd., Centre For High Performance Development Holdings Ltd., Centre For High Performance Development USA Limited, Centre For High Performance Development Limited, Centre For High Performance Development (Singapore) Pte. Ltd., Kenexa Japan K.K., Kenexa Pty. Ltd., Ke nexa Singapore Pte. Ltd., Kenexa Servicos Em Recursos Humanos LTDA, Kenexa Testing Limited, Kenexa France, SARL, Kenexa Middle East FZ LLC, Kenexa Quorum International Holding Ltd., Quorum International Search Limited, Kenexa Quorum International Search d.o.o., Kenexa Quorum sp. Z.o.o, Kenexa Quorum International Ltd. & Co. KG, Kenexa Global Services Limited, Kenexa Munich AV GmbH, Kenexa Germany GmbH and Centre For High Performance Development, LLC, all of whom are Foreign Subsidiaries or owned by Foreign Subsidiaries and (b) the Merger Sub, provided that, after giving effect to the Merger, all Domestic Subsidiaries of the Parent shall be Guarantors and their assets shall be subject to the terms of a Security Agreement.

“Notes”:  as defined in Section 2.2.

“Notice of Borrowing”:  with respect to any Loan, a notice from the Borrower in respect of such Loan, containing the information in respect of such Loan and delivered to the Administrative Agent, in the manner and by the time specified pursuant to the terms hereof.  A form of the Notice of Borrowing is attached hereto as Exhibit B.

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“Obligations”:  collectively, (a) all Reimbursement Obligations and all unpaid principal of and accrued and unpaid interest on (including, without limitation, any interest accruing subsequent to the commencement of a bankruptcy, insolvency or similar proceeding with respect to the Borrower, whether or not such interest constitutes an allowed claim in such proceeding) the Loans, (b) all accrued and unpaid fees arising or incurred under this Agreement or any other Loan Document, (c) any other amounts due hereunder or under any of the other Loan Documents, including all reimbursements, indemnities, fees, costs, expenses, prepayment premiums, break-funding costs and other obligations of the Borrower or any other Loan Party to the Administrat ive Agent, any Lender or any indemnified party hereunder or thereunder, (d) any obligations owed by the Borrower or any other Loan Party to any Lender or to any Affiliate of any Lender pursuant to a Hedge Agreement, and (e) all out-of-pocket costs and expenses incurred by the Administrative Agent and the Lenders in connection with this Agreement and the other Loan Documents, including but not limited to the reasonable fees and expenses of the Administrative Agent’s counsel and each Lender’s counsel, which the Borrower is responsible to pay pursuant to the terms of this Agreement and/or the other Loan Documents.

“Participant”:  as defined in subsection 9.6(f).

“Parent”:  Kenexa Corporation, a Pennsylvania corporation.

“PBGC”:  the Pension Benefit Guaranty Corporation established pursuant to Subtitle A of Title IV of ERISA, or any Governmental Authority succeeding to the function thereof.

“Permitted Acquisition”: (a) the Merger, (b) the Tender Offer, and (c) subject to compliance with Section 6.6, an acquisition by the Parent or any Subsidiary thereof (whether by merger, consolidation, reorganization or purchase of assets or stock or other ownership interests) of any Person engaged in a business that a Subsidiary of the Parent is permitted to engage in pursuant to Section 6.10 that is not hostile in nature; provided, that, at the time that any definitive agreement is entered into in respect of such acquisition (or immediately prior to the closing of such agr eement if such agreement contains a contingency for any approval required under this Agreement with respect to such acquisition), no Default or Event of Default shall exist or would exist if such acquisition were consummated on such date (assuming for purposes of the covenants contained in Section 6.1, that pro forma adjustments are made to the consolidated financial statements of the Parent and its Subsidiaries in accordance with the terms hereof reflecting such acquisition based on the historical audited financial statements (on a GAAP basis) or independent third party due diligence report and other information of such Person received by the Administrative Agent prior to the consummation of such acquisition), provided further, that approval of the Required Lenders shall be required for any such acquisition if (i) at the time of and after giving effect to such acquisition, t he Liquidity Level would be less than $5,000,000 or (ii) the Total Leverage Ratio calculated as of the end of the immediately preceding fiscal quarter for which financial statements have been delivered to the Lenders on a pro forma basis (i.e., after giving effect to such Permitted Acquisition and the borrowing of any Indebtedness in connection therewith as if consummated on the last day of such fiscal quarter) would exceed 1.75 to 1.0.

“Permitted Investments”:  Investments in:

(a)one or more Subsidiaries of the Parent; provided that the aggregate amount of net Investments made by the Parent and the other Loan Parties in Non-Loan Parties shall not exceed $10,000,000 in the aggregate for the period from and after the Closing Date, including, in each case any Investments made after the Closing Date in Non-Loan Parties pursuant to any other provisions of this definition including clause (p) below (measured, with respect to any Permitted Acquisition involving the assets or stock of a Non-Loan Party, as the purchase price for such assets or stock as reasonably determined by the Bor rower);

(b)Property to be used in the ordinary course of business of a Subsidiary of the Parent;

(c)current assets arising from the sale or purchase of goods and services in the ordinary course of business of a Subsidiary of the Parent;

(d)direct obligations of the United States of America or any agency or instrumentality thereof, or obligations guaranteed by the United States of America or any agency or instrumentality thereof, provided that such obligations mature within one (1) year from the date of acquisition thereof;

(e)certificates of deposit, time deposits or banker’s acceptances, maturing within one (1) year from the date of acquisition, with banks or trust companies organized under the laws of the United States, the unsecured long-term debt obligations of which are rated “A3” or higher by Moody’s or “A-” or higher by S&P, and issued, or in the case of banker’s acceptance, accepted, by a bank or trust company having capital, surplus and undivided profits aggregating at least $500,000,000;

(f)commercial paper given the highest rating by either S&P or Moody’s maturing not more than 270 days from the date of creation thereof;

(g)in “money market funds” within the meaning of Rule 2a-7 of the Investment Company Act of 1940, as amended;

(h)in other short-term Investments utilized by Foreign Subsidiaries in accordance with normal investment practices for cash management in Investments of a type analogous to the foregoing clauses (d) through (g);

(i)received in connection with the bankruptcy or reorganization of, or settlement of delinquent accounts and disputes with, customers and suppliers, in each case, in the ordinary course of business;

(j)in connection with Hedge Agreements that are permitted pursuant to Section 6.2 hereof;

(k)Investments in connection with any cash management agreements with PNC;

(l)trade credit extended on usual and customary terms in the ordinary course of business;

(m)loans to shareholders, directors or officers in an aggregate amount not to exceed $500,000 at any one time outstanding;

(n)advances to employees to meet expenses incurred by such employees in the ordinary course of business in an aggregate amount not to exceed $500,000at any one time outstanding;

(o)Investments existing on the date hereof and set forth on Schedule IV hereto;

(p)Permitted Acquisitions;

(q)Loans from Parent and its Subsidiaries to Spirit Merger Sub to allow it to consummate the Tender Offer and the Merger; and

(r)Investments not otherwise provided in clauses (a) through (q) above in an aggregate amount not to exceed $250,000 outstanding at any one time.

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“Permitted Liens”:  as defined in Section 6.3.

“Person”:  an individual, partnership, corporation, limited liability company, limited liability partnership, business trust, joint stock company, trust, unincorporated association, joint venture, Governmental Authority or other entity of whatever nature.

“Plan”:  at a particular time, any employee benefit plan which is covered by ERISA and in respect of which the Parent, any Subsidiary or a Commonly Controlled Entity is (or, if such plan were terminated at such time, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.

“Pledge Agreement”:  (a) the Pledge Agreement or Agreements, dated as of the date hereof, to be executed and delivered on the Closing Date and (b) any other Pledge Agreement between a Loan Party and the Administrative Agent, each substantially in the form of Exhibit E hereto, as amended, supplemented or otherwise modified from time to time.

“PNC”:  PNC Bank, National Association.

“Prime Rate”:  the rate of interest per annum publicly announced from time to time by PNC as its prime rate in effect at its principal office in Philadelphia, Pennsylvania, which rate may not be the lowest rate then being charged to commercial borrowers by PNC; each change in the Prime Rate shall be effective on the date such change is publicly announced as effective.

“Properties”:  the collective reference to the facilities and properties owned, leased or operated by the Parent and its Subsidiaries.

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

“Purchasing Lender”:  as defined in subsection 9.6(b).

“Register”:  as defined in subsection 9.6(d).

“Regulations D, T, U and X”:  Regulations D, T, U and X promulgated by the Board of Governors of the Federal Reserve System (12 C.F.R. Part 204 etseq., 12 C.F.R. part 220 etseq., 12 C.F.R. Part 221 etseq. and 12 C.F.R. Part 224 etseq., respec tively), as such regulations are now in effect and as may hereafter be amended.

“Reimbursement Obligations”:  in respect of each Letter of Credit, the obligation of the Borrower to reimburse the Issuing Bank for all drawings made thereunder in accordance with subsection 2.4(d) and the Application related to such Letter of Credit for amounts drawn under such Letter of Credit.

“Reorganization”:  with respect to any Multiemployer Plan, the condition that such plan is in reorganization within the meaning of Section 4241 of ERISA.

“Reportable Event”:  any of the events set forth in Section 4043(c)(1), (2), (4), (5), (6), (10) and (13) of ERISA.

“Required Lenders”:  at any time, such Lenders as hold, individually or collectively, at least (a) 66 2/3% of the Revolving Credit Commitments, or (b) in the event that the Revolving Credit Commitments have expired or terminated, 66 2/3% of the Revolving Credit Exposure of all of the Lenders at such time.

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“Requirement of Law”:  as to any Person, the Articles or Certificate of Incorporation or Formation, By-Laws, partnership agreement, operating agreement or other organizational or governing documents of such Person, and any law, treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case binding upon such Person or any of its property or to which such Person or any of its property is subject.

“Responsible Officer”:  with respect to any Person, the chief executive officer, president, chief or principal financial officer or controller of such Person.  Unless otherwise qualified, all references to a “Responsible Officer” in this Agreement shall refer to a Responsible Officer of the Borrower.

“Revolving Credit Commitment”:  with respect to each Revolving Credit Lender, the commitment of such Lender to make Revolving Credit Loans and/or participate in Letters of Credit in the aggregate amount not to exceed at any one time outstanding:  (a) as to any Revolving Credit Lender which is an original signatory to this Agreement, the amount set forth opposite such Lender’s name on Schedule I hereto under the caption “Revolving Credit Loans,” as such amount may be increased or decreased from time to time in accordance with the provisions of this Agreement, or (b) as to any Revolving Credit Lender which is not an original signatory to this Agree ment but which becomes a Revolving Credit Lender by executing an Assignment and Assumption, the Revolving Credit Commitment for such Lender set forth on Schedule I to such Assignment and Assumption, as such amount may be increased or decreased from time to time in accordance with the provisions of this Agreement.  The aggregate amount of the Revolving Credit Commitments on the Closing Date is $25,000,000.

“Revolving Credit Commitment Percentage”:  as to any Revolving Credit Lender at any time, the percentage which such Lender’s Revolving Credit Commitment then constitutes of the aggregate Revolving Credit Commitments of all of the Revolving Credit Lenders at such time (or, at any time after the Revolving Credit Commitments shall have expired or been terminated, the percentage which such Lender’s Revolving Credit Exposure constitutes of the Revolving Credit Exposure of all of the Revolving Credit Lenders at such time).

“Revolving Credit Commitment Period”:  the period from and including the Closing Date to, but not including, the Revolving Credit Termination Date, or such earlier date on which the Revolving Credit Commitments shall terminate in their entirety as provided herein.

“Revolving Credit Exposure”:  as to any Revolving Credit Lender at any time, the sum of (a) the aggregate principal amount of all Revolving Credit Loans made by such Lender then outstanding and (b) such Lender’s Revolving Credit Commitment Percentage multiplied by the aggregate Letter of Credit Obligations at such time.

“Revolving Credit Lender”:  as defined in the Preamble hereto and any other Person that becomes a Lender hereunder by reason of an Assignment and Assumption.

“Revolving Credit Loans”:  as defined in Section 2.1.

“Revolving Credit Note”:  as defined in Section 2.2.

“Revolving Credit Termination Date”:  the earlier of (a) August 30, 2013 and (b) the date the Revolving Credit Commitments are terminated in their entirety as provided herein.

“Salary.com”:  Salary.com, Inc., a Delaware corporation.

“SEC”:  the Securities and Exchange Commission or any successor governmental agency thereof.

“S&P”:  Standard & Poor’s Rating Group, a division of McGraw-Hill Corporation.

“Security”:  “security” as defined in Section 2(1) of the Securities Act of 1933, as amended.

“Security Agreement”:  (a) the Security Agreement entered into on the Closing Date among the Borrower, the Guarantors as of such date and the Administrative Agent for the benefit of the secured parties thereunder (including the Lenders) and (b) any other Security Agreement entered into by a Guarantor and the Administrative Agent, in each case substantially in the form of Exhibit F hereto, as the same may be amended, supplemented or otherwise modified from time to time.

“Security Documents”:  collectively, any and all of (a) the Security Agreement(s), (b) the Guaranty(ies), (c) the Pledge Agreement(s) and (d) all additional documents and instruments entered into from time to time for the purpose of securing the Obligations, as the foregoing may be amended, supplemented or otherwise modified from time to time.

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“Solvent”:  as to any Person, as of the time of determination, the financial condition under which the following conditions are satisfied:

(a)the fair market value of the assets of such Person will exceed the debts and liabilities, subordinated, contingent or otherwise, of such Person;

(b)the present fair saleable value of the Property of such Person will be greater than the amount that will be required to pay the probable liability of such Person on its debts and other liabilities, subordinated, contingent or otherwise, as such debts and other liabilities become absolute and matured;

(c)such Person intends and will be able to pay its debts and liabilities, subordinated, contingent or otherwise, as such debts and liabilities become absolute and matured; and

(d)such Person will not have unreasonably small capital with which to conduct the business in which it is engaged as such business is then conducted and is proposed to be conducted after the date thereof.

“Spirit Merger Sub”:  Spirit Merger Sub, Inc., a Delaware corporation and a direct Subsidiary of the Parent.

“Spirit Rights Agreement”:  the Rights Agreement between Salary.com and American Stock Transfer & Trust Company, LLC, dated as of November 14, 2008, as it may be amended, supplemented or otherwise modified from time to time.

“Subordinated Debt”:  Indebtedness of a Subsidiary of the Parent which is subordinated to the Obligations in a manner satisfactory to the Administrative Agent, including that (a) no portion of the principal of such Indebtedness shall be payable prior to ninety (90) days after the Revolving Credit Termination Date, (b) such Indebtedness shall be unsecured and (c) the subordinated creditor(s) shall be subject to a standstill period of at least one hundred eighty (180) days with respect to the exercise of its remedies following the occurrence of an Event of Default.

“Subsidiary”:  as to any Person, a corporation, partnership, limited liability company or other entity of which shares of stock or other ownership interests having ordinary voting power (other than stock or such other ownership interests having such power only by reason of the happening of a contingency) to elect a majority of the board of directors or other managers of such corporation, partnership, limited liability company or other entity are at the time owned, or the management of which is otherwise controlled, directly or indirectly through one or more intermediaries, or both, by such Person.  Unless otherwise qualified, all references to a “Subsidiary” or to “Subsidiaries” in this Agreement shall refer to a Subsi diary or Subsidiaries of the Parent.

“Taxes”:  as defined in Section 2.13.

“Tender Offer”:  the tender offer by Spirit Merger Sub to purchase all of Salary.com’s stock, par value $0.0001 per share, including the associated preferred stock purchase rights under the Spirit Rights Agreement at a price per share of $4.07, net to the holder in cash without interest, subject to any tax withholding.

“Total Debt”:  at any time, all Indebtedness of the Parent and its Subsidiaries at such time determined on a consolidated basis in accordance with GAAP and without duplication.

“Total Leverage Ratio”:  as of the last day of any fiscal quarter, the ratio of (a) Total Debt at such date to (b) Modified EBITDA for the period of four (4) consecutive fiscal quarters ending on such date.

“Tranche”:  the collective reference to (a) Eurodollar Loans whose Interest Periods begin on the same date and end on the same later date (whether or not such Loans originally were made on the same date) and (b) Base Rate Loans.

“Type”:  when used in respect of any Loan or Borrowing, shall refer to the Rate by reference to which interest on such Loan or on the Loans comprising such Borrowing is determined.  For purposes hereof, “Rate” shall include the Eurodollar Rate and the Base Rate.

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“Unrestricted Investment Account”:  each investment account maintained by the Parent and/or a Subsidiary thereof at a Lender or Affiliate thereof and which has been designated by the Borrower and accepted by the Administrative Agent as an “Unrestricted Investment Account.”  For the avoidance of doubt, an operating account shall not constitute an Unrestricted Investment Account.

“Unused Revolving Credit Commitment”:  as to any Lender at any particular time during the Revolving Credit Commitment Period, an amount equal to the excess, if any, of the Revolving Credit Commitment of such Lender at such time over the Revolving Credit Exposure of such Lender at such time.

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

“Withdrawal Liability”:  any withdrawal liability as defined in Section 4201 of ERISA.

1.2Other Definitional Provisions

.  (a)  Unless otherwise specified therein, all terms defined in this Agreement shall have the defined meanings when used in the Notes, the other Loan Documents or any certificate or other document made or delivered pursuant hereto or thereto.  Except as otherwise provided in this Agreement, all computations and determinations as to accounting or financial matters and all financial statements to be delivered pursuant to this Agreement shall be made and prepared in accordance with GAAP (including principals of consolidation where appropriate).  As used herein and in the Notes and the other Loan Documents, and any certificate or other document made or delivered pursuant hereto or thereto, accounting terms relating to the Parent and its Subsidiaries not defined in Section 1.1 and accounting terms partl y defined in Section 1.1, to the extent not defined, shall have the respective meanings given to them under GAAP.

(b)The words “hereof”, “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and Section, Subsection, Schedule and Exhibit references are to this Agreement unless otherwise specified.

(c)The meanings given to terms defined in this Agreement shall be equally applicable to both the singular and plural forms of such terms.

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SECTION 2.  LOANS AND TERMS OF COMMITMENTS

2.1Revolving Credit Commitments

.  Subject to the terms and conditions hereof, each Revolving Credit Lender severally agrees to make revolving credit loans (the “Loans” or the “Revolving Credit Loans”) to the Borrower from time to time during the Revolving Credit Commitment Period in an aggregate principal amount at any one time outstanding not to exceed the amount of such Lender’s Revolving Credit Commitment minus the sum of such Lender’s Revolving Credit Commitment Percentage of all Letter of Credit Obligations then outstanding; provided that no Revolving Credit Loan shall be made if, after giving effect thereto and the simultaneous application of the proceeds thereof, the Revolving Credit Expos ure of all Revolving Credit Lenders would exceed the Revolving Credit Commitments of all Revolving Credit Lenders at such time.  If at any time the aggregate Revolving Credit Exposure of all of the Revolving Credit Lenders exceeds the Revolving Credit Commitments of all of the Revolving Credit Lenders at such time, the Borrower shall promptly prepay the excess to the Administrative Agent, to be applied first to repay the Revolving Credit Loans and then as cash collateral to secure the Letter of Credit Obligations.  Unless otherwise directed by the Borrower, payments on Revolving Credit Loans pursuant to the preceding sentence shall be applied first to Base Rate Loans and then to Eurodollar Loans in the direct order of maturity.  The Revolving Credit Commitments may be reduced or terminated from time to time pursuant to Section 2.9.  Within the foregoing limits, the Borrower may during the Revolving Credit Commitment Period borrow, repay and reborrow from time to time u nder the Revolving Credit Commitments, subject to and in accordance with the terms and limitations hereof.  The failure of any Revolving Credit Lender to perform its obligations hereunder shall not relieve any other Revolving Credit Lender of its obligations hereunder (it being understood, however, that no Revolving Credit Lender shall be responsible for the failure of any other Revolving Credit Lender to make any Revolving Credit Loan required to be made by such other Revolving Credit Lender).  Each Revolving Credit Loan shall be made in accordance with the procedures set forth in Section 2.3.

2.2Revolving Credit Notes

.  The Revolving Credit Loans made by each Revolving Credit Lender shall be evidenced by a promissory note of the Borrower, substantially in the form of Exhibit A-1 hereto, with appropriate insertions as to payee, date and principal amount (as each may be amended, supplemented or otherwise modified, a “Note” or “Revolving Credit Note”), payable to the order of such Revolving Credit Lender and in a principal amount equal to the amount of the initial Revolving Credit Commitment of such Revolving Credit Lender.  Each Revolving Credit Lender is hereby authorized to record the date, Type, and amount of each Revolving Credit Loan made by such Revolving Credit Lender, a nd the date and amount of each payment or prepayment of principal thereof, on the schedule annexed to and constituting a part of its Revolving Credit Note, provided that the failure of any Revolving Credit Lender to make such recordation (or any error in such recordation) shall not affect the obligations of the Borrower hereunder or under such Revolving Credit Note.  Each Revolving Credit Note shall (a) be dated the Closing Date, (b) be stated to mature on the Revolving Credit Termination Date and (c) provide for the payment of interest in accordance with Sections 2.5 and 2.6.

2.3Procedure for Revolving Credit Loans

.  The Borrower may borrow under the Revolving Credit Commitments from time to time during the Revolving Credit Commitment Period on any Business Day.  The Borrower shall give the Administrative Agent a Notice of Borrowing (a) in the case of a Eurodollar Borrowing, not later than 10:30 a.m., Philadelphia time, three (3) Business Days before such proposed Borrowing and (b) in the case of a Base Rate Borrowing, not later than 10:30 a.m., Philadelphia time, on the day of such proposed Borrowing.  All Loans borrowed on the Closing Date shall initially be Base Rate Loans, provided that such Loans can be converted thereafter to Eurodollar Loans in accordance with the terms hereof.  Such Notice of Borrowing shall be irrevocable and shall in each case specify (a) the date of such Borrowi ng (which shall be a Business Day) and the amount thereof; and (b) if such Borrowing is to be a Eurodollar Borrowing, the Interest Period with respect thereto.  If no election as to the Type of Borrowing is specified in any such notice, then the requested Borrowing shall be a Base Rate Borrowing.  If no Interest Period with respect to any Eurodollar Borrowing is specified in any such notice, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration.  Each borrowing under the Revolving Credit Commitments shall be in a minimum amount equal to (x) with respect to Eurodollar Borrowings, $500,000 or in integral multiples of $500,000 in excess thereof and (y) with respect to Base Rate Borrowings, $500,000 or in integral multiples of $100,000 in excess thereof (or, with respect to Base Rate Borrowings, if the aggregate Unused Revolving Credit Commitments at such time are less than $500,000, such lesser amount, as applicable).

Upon receipt of a Notice of Borrowing from the Borrower, the Administrative Agent shall promptly notify each Revolving Credit Lender of such request.  Each Revolving Credit Lender will make the amount of its prorata share of such Borrowing (based on its Revolving Credit Commitment Percentage at that time) available to the Administrative Agent for the account of the Borrower at the office of the Administrative Agent specified in Section 9.2 prior to 2:00 p.m., Philadelphia time, on the Borrowing Date requested by the Borrower in funds immediately available to the Administrative Agent.  Such Borrowing will then be made available to the Borrower by the Administrative Agent crediting the a ccount of the Borrower on the books of the Administrative Agent with the aggregate of the amounts made available to the Administrative Agent by the Lenders and in like funds as received by the Administrative Agent.

Unless the Administrative Agent shall have received notice from a Revolving Credit Lender prior to the date of any borrowing of Revolving Credit Loans that such Revolving Credit Lender will not make available to the Administrative Agent such Revolving Credit Lender’s prorata portion of such Borrowing, the Administrative Agent may assume that such Revolving Credit Lender has made such portion available to the Administrative Agent on the date of such borrowing in accordance with this subsection and the Administrative Agent may, in reliance upon such assumption, make available to the Borrower on such date a corresponding amount.  If and to the extent that such Revolving Credit Lender shall not hav e made such portion available to the Administrative Agent, such Revolving Credit Lender and the Borrower (without prejudice to the Borrower’s rights against such Revolving Credit Lender) severally agree to repay to the Administrative Agent forthwith on demand such corresponding amount together with interest thereon, for each day from the date such amount is made available to the Borrower until the date such amount is repaid to the Administrative Agent at (i) in the case of the Borrower, the interest rate applicable at the time to the Revolving Credit Loans comprising such Borrowing and (ii) in the case of such Revolving Credit Lender, the Federal Funds Effective Rate, provided, that, if such Lender shall not pay such amount within three (3) Business Days of such Borrowing Date, the interest rate on such overdue amount shall, at the expiration of such three-Business Day period, be the rate per annum applicable to the Revolving Credit Loans comprising such Borrowing.  If such Lender shall repay to the Administrative Agent such corresponding amount, such amount shall constitute such Lender’s Revolving Credit Loan as part of such Borrowing for purposes of this Agreement.

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2.4Letter of Credit Subfacility.

(a)During the Revolving Credit Commitment Period, the Borrower may request the issuance of standby Letters of Credit to support obligations of a Subsidiary of the Parent which finance the working capital and business needs of a Subsidiary of the Parent by delivering to the Issuing Bank a completed Application for letters of credit in such form and with such other certificates, documents and information as the Issuing Bank may specify from time to time by no later than 12:00 noon, Philadelphia time, at least five (5) Business Days (or such shorter period as may be agreed to by the Issuing Bank) in advance of the proposed date of issuance.  Each Application for issuance of a Letter of Credit shall be accompanied by an issuance fee based upon the Issuing Bank’s standard schedule of fees charged for issuing letters of credit as such may be amended from time to time.  Subject to the terms and conditions hereof and in reliance on the agreements of the other Revolving Credit Lenders set forth in this Section, the Issuing Bank will issue a Letter of Credit, provided, that each Letter of Credit shall (i) have a maximum maturity of twelve (12) months from the date of issuance, and (ii) in no event expire later than five (5) Business Days prior to the Revolving Credit Termination Date, and provided further, that in no event shall the amount of the Letter of Credit Obligations at any one time exceed the lesser of (i) the L/C Sublimit and (ii) the aggregate Revolving Credit Commitments minus the aggregate principal amount of the Revolving Credit Loans then outstanding.  The Issuing Bank shall not at any time be obligated to issue any Letter of Credit hereunder if such issuance would conflict with, or cause the Issuing Bank or any Letter of Credit Participant to exceed, any limits imposed by any applicable Requirement of Law.  Notwithstanding the provisions of this Section, the Revolving Credit Lenders and the Borrower hereby agree that the Issuing Bank may issue upon the Borrower’s request, one or more Letter(s) of Credit which by its or their terms may be extended for additional periods of up to one year each provided that (I) the initial expiration date (or any subsequent expiration date) of each such Letter of Credit is not later than five (5) Business Days prior to the Revolving Credit Termination Date, and (II) renewal of such Letter(s) of Credit, at the Issuing Bank’s discretion, shall be available upon written request from the Borrower to the Issuing Bank at least thirty (30) days (or such other time period as agreed by the Borrower and the Issuing Bank) before the date upon which notice of renewal is otherwise required.  Each standby Letter of Credit shall be subject either to the Uniform Customs and Practice for Documentary Credits as most recently published by the International Chamber of Commerce at the time a Letter of Credit is issued (“UCP”) or the International Standby Practices (ISP98 International Chamber of Commerce Publication Number 590 (“ISP98”)), as determined by the Issuing Bank.

(b)The Borrower shall pay to the Administrative Agent for the ratable account of the Revolving Credit Lenders a fee (the “Letter of Credit Fee”) equal to the amount of the Applicable Margin for Revolving Credit Loans that are Eurodollar Loans in effect from time to time multiplied by the daily average of the undrawn face amount of each Letter of Credit during the preceding fiscal quarter (or shorter period commencing with the Closing Date or ending on the Revolving Credit Termination Date), and shall be payable quarterly in arrears on each January 1, April 1, July 1 and October 1 commencing with October 1, 2010 and on the Revolving Cred it Termination Date.  The Borrower shall also pay to the Issuing Bank the Issuing Bank’s then in effect customary fees, plus a fronting fee of twelve and one-half basis points (.125%) on the face amount of each such Letter of Credit, and administrative expenses payable with respect to each Letter of Credit issued or renewed by it as the Issuing Bank may generally charge from time to time; provided that, no fronting fee shall be payable for any period in which there is only one Lender.  Once paid, all of the above fees shall be nonrefundable under all circumstances.  All periodic interest, fees and commissions shall be calculated on the basis of the actual days elapsed in a 360 day year.

(c)(i) The Issuing Bank irrevocably agrees to grant and hereby grants to each Letter of Credit Participant, and, to induce the Issuing Bank to issue Letters of Credit hereunder, each Revolving Credit Lender irrevocably agrees to accept and purchase and hereby accepts and purchases from the Issuing Bank, on the terms and conditions hereinafter stated, for such Letter of Credit Participant’s own account and risk, an undivided interest equal to such Letter of Credit Participant’s Revolving Credit Commitment Percentage in the Issuing Bank’s obligations and rights under each Letter of Credit issued by the Issuing Bank (including the Existing Letters of Credit) and the amount of each draft paid by the Issuing Bank thereunder.  Each Letter of Credit Participant unconditionally and irrevocably agrees with the Issuing Bank that, if a draft is paid under any Letter of Credit issued by the Issuing Bank for which the Issuing Bank is not reimbursed in full by the Borrower in accordance with the terms of this Agreement, such Letter of Credit Participant shall pay to the Issuing Bank upon demand at the Issuing Bank’s address for notices specified herein an amount equal to such Letter of Credit Participant’s share (based on its Revolving Credit Commitment Percentage) of (x) the amount of such draft or any part thereof, which is not so reimbursed and (y) any taxes, fees, charges or other costs or expenses incurred by the Issuing Bank in connection with such payment.  Any action taken or omitted by the Issuing Bank under or in connection with a Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not create for the Issuing Bank any resultin g liability to any Lender.

(ii)If any amount required to be paid by any Letter of Credit Participant to the Issuing Bank pursuant to subsection 2.4(c)(i) in respect of any unreimbursed portion of any payment made by the Issuing Bank under any Letter of Credit is not paid to the Issuing Bank on the date such payment is due from such Letter of Credit Participant, such Letter of Credit Participant shall pay to the Issuing Bank on demand an amount equal to the product of (x) such amount, times (y) the daily average Federal Funds Effective Rate, as quoted by the Issuing Bank, during the period from and including the date such payment is required to the date on which such payment is immediately available to the Issuing Bank, times (z) a fraction the numerator of which is the number of days that elapse during such period and the denominator of which is 360.  A certificate of the Issuing Bank submitted to any Letter of Credit Participant with respect to any amounts owing under this subsection shall be conclusive in the absence of manifest error.

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(iii)Whenever, at any time after the Issuing Bank has made payment under any Letter of Credit and has received from any Letter of Credit Participant its prorata share of such payment in accordance with subsection 2.4(c)(i), the Issuing Bank receives any payment related to such Letter of Credit (whether directly from the Borrower or otherwise, including by way of set-off or proceeds of collateral applied thereto by the Issuing Bank), or any payment of interest on account thereof, the Issuing Bank will distribute to such Letter of Credit Participant its prorata share thereof; provided, however, that in the event that any such payment received by the Issuing Bank shall be required to be returned by the Issuing Bank, such Letter of Credit Participant shall return to the Issuing Bank the portion thereof previously distributed by the Issuing Bank to it.

(d)(i)  The Borrower agrees to reimburse the Issuing Bank in respect of a Letter of Credit (including an Existing Letter of Credit) on each date on which a draft presented under such Letter of Credit is paid by the Issuing Bank for the amount of (a) such draft so paid and (b) any taxes, fees, charges or other costs or expenses incurred by the Issuing Bank in connection with such payment.  Each such payment shall be made to the Issuing Bank in immediately available funds.  Notwithstanding any other provisions of this Agreement, unless other acceptable arrangements for the immediate reimbursement by the Borrower of amounts required to be advanced by the Issuing Bank pursuant to a Letter of Cred it have been made by the Borrower and the Issuing Bank and such reimbursement is made by the Borrower, any and all amounts which the Issuing Bank is required to advance pursuant to a Letter of Credit shall, at the option of the Issuing Bank, become, at the time the amounts are advanced, Revolving Credit Loans from the Revolving Credit Lenders made as a Base Rate Borrowing.  The Administrative Agent will notify the Revolving Credit Lenders of the amount required to be advanced pursuant to the Letters of Credit.  Before 10:00 A.M. (Philadelphia time) on the date of any advance the Revolving Credit Lenders are required to make pursuant to the Letters of Credit, each Revolving Credit Lender shall make available to the Administrative Agent such Revolving Credit Lender’s Revolving Credit Commitment Percentage of such advance in immediately available funds.

(ii)Interest shall be payable on any and all amounts remaining unpaid by the Borrower under this subsection from the date such amounts become payable (whether at stated maturity, by acceleration or otherwise) until payment in full at the per annum rate of the then applicable Default Rate for Revolving Credit Loans which are Base Rate Loans and shall be payable on demand by the Issuing Bank.

(e)(i)   The Borrower also agrees with the Issuing Bank that the Issuing Bank shall not be responsible for, and the Borrower’s Reimbursement Obligations under subsection 2.4(d)(i) shall not be affected by, among other things (x) the validity or genuineness of documents or of any endorsements thereon, even though such documents shall in fact prove to be invalid, fraudulent or forged, provided, that reliance upon such documents by the Issuing Bank shall not have constituted gross negligence or willful misconduct of the Issuing Bank or (y) any dispute between or among the Borrower and any beneficiary of any Letter of Credit or any other par ty to which such Letter of Credit may be transferred or (z) any claims whatsoever of the Borrower against any beneficiary of such Letter of Credit or any such transferee.

(ii)The Issuing Bank shall not be liable for any error, omission, interruption or delay in transmission, dispatch or delivery of any message or advice, however transmitted, in connection with any Letter of Credit, except for errors or omissions caused by the Issuing Bank’s gross negligence or willful misconduct.

(iii)The Borrower agrees that any action taken or omitted by the Issuing Bank under or in connection with any Letter of Credit or the related drafts or documents, if done in the absence of gross negligence or willful misconduct, shall be binding on the Borrower and shall not result in any liability of the Issuing Bank to the Borrower.

(f)If any draft shall be presented for payment to the Issuing Bank under any Letter of Credit, the Issuing Bank shall promptly notify the Borrower of the date and amount thereof.  The responsibility of the Issuing Bank to the Borrower in connection with any draft presented for payment under any Letter of Credit shall, in addition to any payment obligation expressly provided for in such Letter of Credit and any other obligation expressly imposed by the UCP or ISP98 as applicable to such Letter or Credit, be limited to determining that the documents (including each draft) delivered under such Letter of Credit in connection with such presentment are in conformity with such Letter of Credit.

(g)To the extent that any provision of any Application related to any Letter of Credit is inconsistent with the provisions of this Agreement, the provisions of this Agreement shall govern.

(h)Subject to subsection 2.4(g) above, the Borrower agrees to be bound by the terms of each Application and the Issuing Bank’s written regulations and customary practices relating to letters of credit, though such interpretation may be different from the Borrower’s own.  It is understood and agreed that, except in the case of gross negligence or willful misconduct, the Issuing Bank shall not be liable for any error, negligence and/or mistakes, whether of omission or commission, in following the Borrower’s instructions or those contained in the Letters of Credit or any modifications, amendments or supplements thereto.

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(i)Each Revolving Credit Lender’s payment obligation under subsection 2.4(c) and the Reimbursement Obligations shall be absolute, unconditional and irrevocable under any circumstances, and shall be performed strictly in accordance with the terms of this Section 2.4 under all circumstances, including the following circumstances:

                                                                (i)any set-off, counterclaim, recoupment, defense or other right which such Revolving Credit Lender may have against the Issuing Bank, any Loan Party or any other Person for any reason whatsoever;

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

                                                                (iii)the existence of any claim, set-off, defense or other right which any Loan Party or any Revolving Credit Lender may have at any time against a beneficiary or any transferee of any Letter of Credit (or any Persons for whom any such transferee may be acting), the Issuing Bank or any Revolving Credit Lender or any other Person, whether in connection with this Agreement, the transactions contemplated herein or any unrelated transaction (including any underlying transaction between any Loan Party and the beneficiary for which any Letter of Credit was procured);

                                                                (iv)any draft, demand, certificate or other document presented under any Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect even if the Issuing Bank has been notified thereof;

                                                                (v)payment by the Issuing Bank under any Letter of Credit against presentation of a demand, draft or certificate or other document which does not comply with the terms of such Letter of Credit, provided that such payment shall not have constituted gross negligence or willful misconduct on the part of the Issuing Bank;

                                                               (vi)any adverse change in the business, operations, properties, assets, condition (financial or otherwise) or prospects of the Parent and its Subsidiaries;

(vii)any breach of this Agreement or any other Loan Document by any Loan Party;

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

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

                 (x)the fact that the Revolving Credit Termination Date shall have passed or this Agreement or the Revolving Credit Commitments hereunder shall have been terminated; and

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

(j)In addition to amounts payable as provided in Section 9.5, the Borrower hereby agrees to protect, indemnify, pay and save harmless the Issuing Bank, the Administrative Agent and the Lenders from and against any and all claims, demands, liabilities, damages, losses, costs, charges and expenses (including reasonable fees, expenses and disbursements of counsel) which the Issuing Bank or the Lenders may incur or be subject to as a consequence, direct or indirect, of (i) the issuance of any Letter of Credit, other than as a result of (A) the gross negligence or willful misconduct of the Issuing Bank as determined by a final judgment of a court of competent jurisdiction or (B) subject to the following clause (ii), the wrongful dishonor by the Issuing Bank of a proper demand for payment made under any Letter of Credit, or (ii) the failure of the Issuing Bank to honor a drawing under any such Letter of Credit as a result of any act or omission, whether rightful or wrongful, of any present or future de jure or de facto government or governmental authority (all such acts or omissions herein called “Governmental Acts”).

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(k)As among the Borrower and the Issuing Bank, the Borrower assumes all risks of the acts and omissions of, or misuse of the Letters of Credit by, the respective beneficiaries of such Letters of Credit.  In furtherance and not in limitation of the foregoing, the Issuing Bank shall not be responsible for:  (i) the form, validity, sufficiency, accuracy, genuineness or legal effect of any document submitted by any party in connection with the application for an issuance of or drawing under any such Letter of Credit, even if it should in fact prove to be in any or all respects invalid, insufficient, inaccurate, fraudulent or forged (even if the Issuing Bank shall have been notified thereof); (ii) the valid ity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign any such Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason; (iii) the failure of the beneficiary of any such Letter of Credit, or any other party to which such Letter of Credit may be transferred, to comply fully with any conditions required in order to draw upon such Letter of Credit or any other claim of any Loan Party against any beneficiary of such Letter of Credit, or any such transferee, or any dispute between or among any Loan Party and any beneficiary of any Letter of Credit or any such transferee; (iv) errors, omissions, interruptions or delays in transmission or delivery of any messages, by mail, facsimile, cable, telex or otherwise; (v) errors in interpretation of technical terms; (vi) any loss or delay in the transmission or otherwise of any document required in order to make a drawing under any such Letter of Credit or of the proceeds thereof; (vii) the misapplication by the beneficiary of any such Letter of Credit of the proceeds of any drawing under such Letter of Credit; or (viii) any consequences arising from causes beyond the control of the Issuing Bank, including any Governmental Acts, and none of the above shall affect or impair, or prevent the vesting of, any of the Issuing Bank’s rights or powers hereunder.

In furtherance and extension and not in limitation of the specific provisions set forth above, any action taken or omitted by the Issuing Bank under or in connection with the Letters of Credit issued by it or any documents and certificates delivered thereunder, if taken or omitted in good faith, shall not create any liability of the Issuing Bank to the Borrower or any Lender.

(l)Notwithstanding anything to the contrary herein, the Existing Letters of Credit shall be considered Letters of Credit issued hereunder.

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2.5Interest and Payment Dates

                                     (a)  Subject to the provisions of Section 2.6, each Base Rate Loan shall bear interest (computed on the basis of the actual number of days elapsed over a year of 365 or 366 days, as the case may be) at a rate per annum equal to the Base Rate plus one hundred twenty-five (125) basis points (1.25%).

(b)Subject to the provisions of Section 2.6, each Eurodollar Loan shall bear interest (computed on the basis of the actual number of days elapsed over a year of 360 days) at a rate per annum equal to the Eurodollar Rate for the Interest Period in effect for such Loan plus two hundred twenty-five (225) basis points (2.25%).

(c)Interest on each Loan shall be payable on each Interest Payment Date applicable to such Loan; provided that, interest accruing on overdue amounts pursuant to Section 2.6 shall be payable on demand as provided in such Section.  The Eurodollar Rate and the Base Rate shall be determined by the Administrative Agent, and such determination shall be conclusive absent manifest error.

2.6Default Interest

.  To the extent not contrary to any Requirement of Law, upon the occurrence and during the continuation of an Event of Default, any principal, past due interest, fee or other amount outstanding hereunder shall bear interest for each day thereafter until paid in full (after as well as before judgment) at a rate per annum which shall be equal to two percent (2%) in excess of the rate which would otherwise be in effect for Base Rate Loans (such rate being referred to as the “Default Rate”); provided that, with respect to Eurodollar Loans, such rate shall be the higher of the Default Rate and two percent (2%) in excess of the rate which would otherwise be applicable to such Eurodollar Loan.  The Borrower acknowledges that such increased interest rate reflects, among other things, the fact that such loans or other amounts have become a substantially greater risk given their default status and that the Lenders are entitled to additional compensation for such risk.

2.7Conversion and Continuation Options; Limitations on Tranches

                                                 (a)  The Borrower shall have the right at any time upon prior irrevocable notice to the Administrative Agent (a) not later than 10:30 a.m., Philadelphia time, on the Business Day of conversion, to convert any Eurodollar Loan to a Base Rate Loan, (b) not later than 10:30 a.m., Philadelphia time, three (3) Business Days prior to conversion or continuation (x) to convert any Base Rate Loan into a Eurodollar Loan, or (y) to continue any Eurodollar Loan as a Eurodollar Loan for any additional Interest Period and (c) not later than 10:30 a.m., Philadelphia time, three (3) Business Days prior to conversion, to convert the Interest Period with respect to any Eurodollar Loan to another permissible Interest Period, subject in each case to the following:

(A)a Eurodollar Loan may not be converted at a time other than the last day of the Interest Period applicable thereto;

(B)any portion of a Loan maturing or required to be repaid in less than one month may not be converted into or continued as a Eurodollar Loan;

(C)no Eurodollar Loan may be continued as such and no Base Rate Loan may be converted to a Eurodollar Loan when any Default or Event of Default has occurred and is continuing;

(D)any portion of a Eurodollar Loan that cannot be converted into or continued as a Eurodollar Loan by reason of clauses (B) or (C) above automatically shall be converted at the end of the Interest Period in effect for such Loan to a Base Rate Loan;

(E)if by the third Business Day prior to the last day of any Interest Period for Eurodollar Loans the Borrower has failed to give notice of conversion or continuation as described in this subsection, the Administrative Agent shall give notice thereof to the Lenders and such Loans shall be automatically converted to Base Rate Loans on the last day of such then expiring Interest Period;

(F)all conversions and continuations of Loans hereunder and all selections of Interest Periods hereunder shall be in such amounts and be made pursuant to such elections that, after giving effect thereto, the aggregate principal amount of the Loans comprising each Tranche of Eurodollar Loans shall be equal to $500,000 or in increments of $500,000 in excess thereof; and

(G)the Borrower shall not have outstanding at any one time more than six (6) Tranches in the aggregate of Eurodollar Loans.

Each request by the Borrower to convert (but not continue) a Loan shall constitute a representation and warranty that each of the representations and warranties made by the Borrower herein is true and correct in all material respects on and as of such date as if made on and as of such date (except to the extent that such representations and warranties relate expressly to an earlier date, in which case such request shall constitute a representation and warranty that such representations and warranties are true and correct as of such date).  Accrued interest on a Loan (or portion thereof) being converted shall be paid by the Borrower at the time of conversion.

(b)In the event, and on each occasion, that on the day two (2) Business Days prior to the commencement of any Interest Period for a Eurodollar Loan, the Administrative Agent shall have determined (which determination absent manifest error shall be conclusive and binding upon the Borrower) that dollar deposits in the principal amount of such Eurodollar Loan are not generally available in the London Interbank Market, or that the rate at which such dollar deposits are being offered will not adequately and fairly reflect the cost to the applicable Lenders of making or maintaining the principal amount of such Eurodollar Loan during such Interest Period, or that reasonable means do not exist for ascertaining the Eurodollar Rate, the Admi nistrative Agent shall, as soon as practicable thereafter, give written or telephonic notice of such determination to the Borrower and the applicable Lenders, and any request by the Borrower for a Eurodollar Loan or for conversion to or maintenance of a Eurodollar Loan pursuant to the terms of this Agreement shall be deemed a request for a Base Rate Loan.  After such notice shall have been given and until the circumstances giving rise to such notice no longer exist, each request for a Eurodollar Loan shall be deemed to be a request for a Base Rate Loan.  Each determination by the Administrative Agent hereunder shall be conclusive absent manifest error.

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2.8Commitment Fees

.  The Borrower agrees to pay to the Administrative Agent for the account of each Revolving Credit Lender, on each January 1, April 1, July 1 and October 1, commencing October 1, 2010, during the Revolving Credit Commitment Period and on the date on which the Revolving Credit Commitments shall be permanently terminated or reduced as provided herein, a revolving credit commitment fee (collectively, the “Commitment Fees”) at a rate per annum equal to thirty (30) basis points (0.30%) on the average daily amount of the Unused Revolving Credit Commitments of each Revolving Credit Lender during the preceding fiscal quarter (or shorter period commencing with the Closing Date or ending on the Revolving Credit Termination Date).  The Commitment Fees due to each Revolving Credit Lender shall comme nce to accrue on the Closing Date and shall cease to accrue on the Revolving Credit Termination Date.  The Administrative Agent shall distribute the Commitment Fees among the Revolving Credit Lenders pro rata in accordance with their respective Revolving Credit Commitment Percentages.

All of the foregoing fees shall be (a) computed on the basis of the actual number of days elapsed in a year of 360 days, including the first day but excluding the last day occurring in the period for which such fees are payable, and (b) paid on the dates due, in immediately available funds, to the Administrative Agent for distribution to the applicable Lenders.  Once paid, none of the foregoing fees shall be refundable under any circumstances, except in the case of manifest error by the Administrative Agent in the computation of any such amount, which error is raised in writing by the Borrower to the Administrative Agent within twenty (20) days of payment of such amount.

2.9Termination and Reduction of Revolving Credit Commitments

                                                (a)  The Revolving Credit Commitments shall be automatically terminated on the Revolving Credit Termination Date whereupon the entire outstanding principal balance of the Revolving Credit Loans, plus all accrued and unpaid interest thereon, and any fees or other amounts owed under the Loan Documents (including all Commitment Fees and fees and other amounts in connection with the Letters of Credit) shall be due and payable.

(b)Upon at least five (5) Business Days’ prior irrevocable written notice to the Administrative Agent, the Borrower may at any time prior to the Revolving Credit Termination Date, in whole permanently terminate, or from time to time in part permanently reduce, the Revolving Credit Commitments; provided, however, that (A) each partial reduction of such Revolving Credit Commitments shall be in a minimum aggregate principal amount of $1,000,000 or in integral multiples of $500,000 in excess thereof, and (B) the Revolving Credit Commitments may not be reduced or terminated if, after giving ef fect thereto and to any prepayments of the Revolving Credit Loans made on the effective date thereof, the aggregate amount of the Revolving Credit Exposure of the Revolving Credit Lenders at such time would exceed the aggregate Revolving Credit Commitments of the Revolving Credit Lenders (as the same are being reduced) at such time.  Each reduction in the Revolving Credits Commitments hereunder shall be made ratably among the Revolving Credit Lenders in accordance with their respective Revolving Credit Commitment Percentages.  The Borrower shall pay to the Administrative Agent for the account of the Revolving Credit Lenders on the date of each termination or reduction of the Revolving Credits Commitments, the Commitment Fees on the amount of the Revolving Credit Commitments so terminated or reduced accrued to the date of such termination or reduction.

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2.10Optional and Mandatory Prepayments of Loans

                                                 (a) The Borrower shall have the right at any time and from time to time to prepay any Borrowing, in whole or in part, without premium or penalty (but in any event subject to Section 2.14), upon prior written, telecopy or telephonic notice to the Administrative Agent given no later than 10:30 a.m., Philadelphia time, (i) in the case of Base Rate Loans, on the same day such prepayment is to be made, and (ii) in the case of Eurodollar Loans, three (3) Business Days before any proposed prepayment is to be made; provided, however, that each such partial prepayment shall be in the principal amount of at least (A) $500,000 or in whole multiples of $100,000 in the case of Base Rate Loans and (B) $500,000 or in whole multiples of $500,000 in excess thereof in the case of Eurodollar Loans.

(b)On the date of any termination or reduction of the Revolving Credit Commitments pursuant to Section 2.9, the Borrower shall pay or prepay so much of the Revolving Credit Loans as shall be necessary in order that the aggregate Revolving Credit Exposure of the Revolving Credit Lenders will not exceed the aggregate Revolving Credit Commitments of the Revolving Credit Lenders after giving effect to such termination or reduction.

(c)In the event of (i) any direct or indirect sale or other disposition of any of the assets, including lines of business, of any Subsidiary of the Parent (other than sales or dispositions referred to in subsections 6.5(a), (b) or (c)) (each, an “Asset Sale”) the sale price for which in the aggregate with all prior Asset Sales made since the date of this Agreement (but only those Asset Sales the Net Proceeds of which were not applied as a prepayment as hereinafter provided in this subsection 2.10(c)) is greater than $1,000,000, (ii) any sale or issuance of Capital Stock by the Parent (other than Capital Stock issued (x) to any seller in conn ection with a Permitted Acquisition or (y) pursuant to any employee equity plan of the Parent or its Subsidiaries), (iii) the incurrence of additional Indebtedness for borrowed money by the Parent or any of its Subsidiaries (other than Indebtedness incurred to a seller in connection with a Permitted Acquisition or otherwise permitted under Section 6.2 (other than Subordinated Debt under subsection (g) thereto unless such Subordinated Debt was incurred in connection with financing a Permitted Acquisition)), or (iv) any Material Recovery Event, the Borrower shall promptly prepay the outstanding Loans in an amount equal to one hundred percent (100%) of the amount of the Net Proceeds of such Asset Sale, issuance of Capital Stock, incurrence of additional Indebtedness or Material Recovery Event; provided that, the amount of any prepayment hereunder shall be rounded down to the nearest multiple of $1,000; provided, further, that no such repayment shall be required in respect of the Net Proceeds arising from (x) an Asset Sale if, and to the extent, that the Borrower or such Subsidiary has reinvested any such Net Proceeds arising from such Asset Sale in productive assets of a kind then used or useable in the business of a Subsidiary of the Parent (including Capital Expenditures) prior to the date that is one hundred eighty days (180) after the date such Asset Sale is closed or (y) a Material Recovery Event if, and to the extent that, (I) the Borrower has notified the Administrative Agent in writing within five (5) Business Days following the receipt of the proceeds of such Material Recovery Event of such Subsidiary’s intention to use such Net Proceeds for the repair, replacement or restoration of the damaged condemned property within one hundred and eighty (180) days following the receipt of such proceeds and (II) such Subsidiary does in fact reinvest such Net Proceeds arising from such Material Recovery Event for the repair, replacement or restoration of the damaged or condemned property prior to the date that is one hundred eighty days (180) after the receipt of such Net Proceeds.  At the time any such Asset Sale, issuance of Capital Stock or incurrence of additional Indebtedness is completed, or promptly after any Net Proceeds are received by the Parent or a Subsidiary thereof in connection with a Material Recovery Event (and, if the Borrower has given notice of its or such Subsidiary’s, as the case may be, intention to use all or a portion of the Net Proceeds from a Material Recovery Event as provided above, one hundred and eighty (180) days after its receipt of such Net Proceeds), the Borrower shall deliver to the Administrative Agent an accounting of the Net Proceeds in sufficient detail and form acceptable to the Administrative Agent together with the amount of any prepayment or repayment required at such time.  Payments made pursuant to this subsection 2.10(c) shall be applied in accordance with subsection 2.10(f) below.

(d)[INTENTIONALLY OMITTED]

(e)Each notice of prepayment pursuant to subsections (a) and (b) of this Section 2.10 shall specify (i) the prepayment date and (ii) the principal amount of each Borrowing to be prepaid.  Each notice of prepayment shall be irrevocable and shall commit the Borrower to prepay such Borrowing (or portion thereof) by the amount stated therein.  All prepayments under this Section 2.10 on other than Base Rate Borrowings shall be accompanied by accrued interest on the principal amount being prepaid to the date of prepayment and any amounts owed under Section 2.14.

(f)Payments pursuant to clause (c) of this Section 2.10 shall be applied to Revolving Credit Loans until paid in full; provided that, if an Event of Default shall have occurred and be continuing, any such payments shall be applied pro rata to the Loans and the Letter of Credit Obligations (based on the principal amount of the Loans outstanding and the aggregate amount of the Letter of Credit Obligations then outstanding), with any amounts attributable to the Letter of Credit Obligations to be held by the Administrative Agent in a cash collateral account pursuant to Section 7.2 or, at the Administrative A gent’s discretion, applied to the Revolving Credit Loans then outstanding.  Payments of the Revolving Credit Loans and/or in respect of the Letter of Credit Obligations shall not reduce the Revolving Credit Commitments.  To the extent any prepayments are required pursuant to clause (c) of this Section 2.10 after the Loans have been paid in full, then, no such payments shall be required unless an Event of Default shall have occurred and be continuing, in which case the Borrower shall deliver to the Administrative Agent, to be held in a cash collateral account pursuant to Section 7.2, an amount equal to the difference between (i) the Letter of Credit Coverage Requirement and (ii) the amount of cash, if any, then held by the Administrative Agent in a collateral account pursuant to Section 7.2, with any remaining Net Proceeds to be applied first to any other outstanding Obligations and next to be retained by the Parent, the Borrower or its Subsidiary, as applicable.   ;So long as no Event of Default shall have occurred and be continuing, unless otherwise requested by the Borrower, each payment shall be applied first to Base Rate Loans and next to Eurodollar Loans in the direct order of maturity of Interest Periods.

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2.11Illegality

.  Notwithstanding any other provision herein, if any change in any Requirement of Law or in the interpretation or application thereof shall make it unlawful for any Lender to make or maintain Eurodollar Loans as contemplated by this Agreement, (a) the commitment of such Lender hereunder to make Eurodollar Loans, continue Eurodollar Loans as such and convert or refinance Base Rate Loans to Eurodollar Loans shall forthwith be cancelled and (b) such Lender’s Loans then outstanding as Eurodollar Loans, if any, shall be converted automatically to Base Rate Loans on the respective last days of the then current Interest Periods with respect to such Loans or within such earlier period as required by law.  If any such conversion of a Eurodollar Loan occurs on a day which is not the last day of the then current Interest Period with respect thereto, the Borrower shall pay to such Lender such amounts, if any, as may be required pursuant to Section 2.14.

2.12Requirements of Law

                                                 (a)  In the event that any change in any Requirement of Law or in the interpretation, or application thereof or compliance by any Lender with any request or directive (whether or not having the force of law) from any central bank or other Governmental Authority made subsequent to the date hereof:

(i)shall subject any Lender to any tax of any kind whatsoever with respect to this Agreement, any Note or any Eurodollar Loan made by it, or change the basis of taxation of payments to such Lender in respect thereof (except for taxes covered by Section 2.13 and changes in the rate of tax on the overall net income, gross receipts or revenue of such Lender);

(ii)shall impose, modify or hold applicable any reserve, special deposit or similar requirement against assets held by, deposits or other liabilities in or for the account of, advances, loans or other extensions of credit by, or any other acquisition of funds by, any office of such Lender which is not otherwise included in the determination of the interest rate on such Eurodollar Loan hereunder; or

(iii)shall impose on such Lender any other condition;

and the result of any of the foregoing is to increase the cost to such Lender, by an amount which such Lender deems to be material, of making, converting into, continuing or maintaining Eurodollar Loans or to reduce any amount receivable hereunder in respect thereof then, in any such case, the Borrower shall as promptly as practicable pay such Lender, upon its demand, any additional amounts necessary to compensate such Lender for such increased cost or reduced amount receivable.  If any Lender becomes entitled to claim any additional amounts pursuant to this subsection, it shall as promptly as practicable notify the Borrower, through the Administrative Agent, of the event by reason of which it has become so entitled.  A certificate as to any additional amounts payable pursuant to this subsection submitted by such Lende r, through the Administrative Agent, to the Borrower shall be conclusive in the absence of manifest error.  This covenant shall survive the termination of this Agreement and the payment of the Notes and all other amounts payable hereunder.  If any amount is refunded to such Lender, such Lender will reimburse the Borrower for amounts paid in respect of the refunded amount without interest (except to the extent of any interest actually received by such Lender from the relevant Governmental Authority with respect to such refund).

(b)In the event that any Lender shall have determined that any change in any Requirement of Law regarding capital adequacy or in the interpretation or application thereof or compliance by such Lender or any corporation controlling such Lender with any request or directive regarding capital adequacy (whether or not having the force of law) from any Governmental Authority made subsequent to the date hereof does or shall have the effect of reducing the rate of return on such Lender’s or such corporation’s capital as a consequence of its obligations hereunder to a level below that which such Lender or such corporation could have achieved but for such change or compliance (taking into consideration such Lender’s or suc h corporation’s policies with respect to capital adequacy) by an amount deemed by such Lender to be material, then from time to time, after submission as promptly as practicable by such Lender to the Borrower (with a copy to the Administrative Agent) of a written request therefor, the Borrower shall pay to such Lender such additional amount or amounts as will compensate such Lender for such reduction.

(c)Each Lender agrees that it will use reasonable efforts in order to avoid or to minimize, as the case may be, the payment by the Borrower of any additional amount under subsections 2.12(a) and (b); provided, however, that no Lender shall be obligated to incur any expense, cost or other amount in connection with utilizing such reasonable efforts; provided, further, that the Borrower shall not be under any obligation to compensate any Lender under this Section 2.12 with respec t to increased costs or reductions with respect to any period prior to the date that is one hundred eighty (180) days prior to such request if such Lender knew or could reasonably have been expected to know of the circumstances giving rise to such increased costs or reductions and of the fact that such circumstances would result in a claim for increased compensation by reason of such increased costs or reductions; provided, further, that the foregoing limitation shall not apply to any increased costs or reductions arising out of the retroactive application of any change in any Law within such one hundred eighty (180) day period.

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2.13Taxes

.  (a)  All payments made by the Borrower under this Agreement and the Notes shall be made free and clear of, and without deduction or withholding for or on account of, any present or future income, stamp or other taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now or hereafter imposed, levied, collected, withheld or assessed by any Governmental Authority, other than Excluded Taxes (all such non-excluded taxes, levies, imposts, duties, charges, fees, deductions and withholdings being hereinafter called “Taxes”).  If any Taxes are required to be withheld from any amounts payable to the Administrative Agent or any Lender hereunder or under the Notes, the amounts so payable to the Administrative Agent or such Lender shall be increased to the extent necessary to yield to the Administrative Agent or such Lender (after payment of all Taxes) interest or any such other amounts payable hereunder at the rates or in the amounts specified in this Agreement and the Notes.  Whenever any Taxes are payable by the Borrower, as promptly as possible thereafter the Borrower shall send to the Administrative Agent for its own account or for the account of such Lender, as the case may be, a certified copy of an original official receipt received by the Borrower showing payment thereof.  If the Borrower fails to pay any Taxes when due to the appropriate taxing authority or fails to remit to the Administrative Agent the required receipts or other required documentary evidence, the Borrower shall indemnify the Administrative Agent and the Lenders for any incremental taxes, interest or penalties that may become payable by the Administrative Agent or any Lender as a result of any such failure.  The agreement s in this subsection shall survive the termination of this Agreement and the payment of the Notes and all other amounts payable hereunder.

(b)Any Foreign Lender that is entitled to an exemption from or reduction of withholding tax under the law of the jurisdiction in which the Borrower is located, or any treaty to which such jurisdiction is a party, with respect to payments under this Agreement shall deliver to the Borrower (with a copy to the Administrative Agent), at the time or times prescribed by applicable law, such properly completed and executed documentation prescribed by applicable law or reasonably requested by the Borrower as will permit such payments to be made without withholding or at a reduced rate.  Each such Foreign Lender shall also deliver to the Borrower (with a copy to the Administrative Agent) such further documentation on or before the date that any documentation previously delivered to the Borrower hereunder shall expire or become obsolete and after the occurrence of any event requiring a change in such previously delivered documentation.

(c)The Borrower shall not be required to pay any additional amounts to the Administrative Agent or any Lender in respect of payments of United States withholding tax or other Taxes made by the Borrower which are consistent with the forms and information delivered to the Borrower and the Administrative Agent or if the payment of such amounts would not have arisen but for a failure by the Administrative Agent or such Lender to comply with the requirements of subsection 2.13(b) or the Administrative Agent or such Lender did not timely deliver to the Borrower the forms listed or described in subsection 2.13(b) or did not take such other steps as reasonably may be available to it under applicable tax laws and any applicable tax treaty o r convention to obtain an exemption from, or reduction (to the lowest applicable rate) of, such United States withholding tax and other Taxes or, if such steps were taken, the information was not timely and duly delivered to the Borrower.

2.14Indemnity

.  (a)  The Borrower agrees to indemnify each Lender and to hold each Lender harmless from any loss or expense which such Lender may sustain or incur as a consequence of (a) default by the Borrower in payment when due of the principal amount of or interest on any Eurodollar Loan, (b) default by the Borrower in making a borrowing of, conversion into or continuation of Eurodollar Loans after the Borrower has given a notice requesting the same in accordance with the provisions of this Agreement, (c) default by the Borrower in making any prepayment after the Borrower has given a notice thereof in accordance with the provisions of this Agreement or (d) the making of a prepayment of Eurodollar Loans on a day which is not the last day of an Interest Period with respect thereto, including, without limitation, in each case, any such loss or expense arising from the reemployment of funds obtained by it or from fees payable to terminate the deposits from which such funds were obtained.  A certificate as to any amounts (including a calculation thereof) that a Lender is entitled to receive under this Section 2.14 submitted by such Lender, through the Administrative Agent, to the Borrower shall be conclusive in the absence of manifest error and all such amounts shall be paid by the Borrower promptly upon demand by such Lender.  This covenant shall survive the termination of this Agreement and the payment of the Notes and all other amounts payable hereunder.

(b)For the purpose of calculation of all amounts payable to a Lender under this Section, each Lender shall be deemed to have actually funded its relevant Eurodollar Loan through the purchase of a deposit bearing interest at the Eurodollar Rate in an amount equal to the amount of that Eurodollar Loan and having a maturity comparable to the relevant Interest Period or applicable period for such Eurodollar Loan; provided, however, that each Lender may fund each of its Eurodollar Loans in any manner it sees fit, and the foregoing assumptions 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 Loans and all other amounts payable hereunder.

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2.15Treatment of Loans and Payments

Except as provided under Sections 2.4, 2.11, 2.13 or subsection 9.6(g), each Borrowing by the Borrower hereunder, each payment or prepayment of principal of the Loans, each payment of interest on the Loans, each payment of Commitment Fees and participation in Letters of Credit shall be made pro rata among the relevant Lenders in accordance with their respective Revolving Credit Commitment Percentage.  Each Lender agrees that in computing such Lender’s portion of any borrowing to be made hereunder, the Administrative Agent may, in its discretion, round each Lender’s amount of such borrowing to the next higher or lower whole dollar amount.

2.16Payments

                                                 (a)  The Borrower shall make each payment (including principal of or interest on any Borrowing or any fees or other amounts) hereunder not later than 12:00 (noon), Philadelphia time, on the date when due to the Administrative Agent at its offices set forth in Section 9.2, in immediately available funds.  Such payments shall be made without setoff or counterclaim of any kind.  The Administrative Agent shall distribute to the Lenders any payments received by the Administrative Agent for their account promptly upon receipt in li ke funds as received, provided that, any payment received by the Administrative Agent for the account of the Lenders at or before 2:00 p.m. Pennsylvania time will be distributed to the Lenders on the same Business Day and any such payment received after that time on a given day may be distributed on the next Business Day.

(b)Whenever any payment hereunder or under the Notes shall be stated to be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day, and such extension of time shall in such case be included in the computation of the payment of interest or fees, as the case may be, provided that if such extension would cause payment of any interest on or principal of the Loans or payment of any commitment fees to be made in the next following calendar month, such payment shall be made on the immediately preceding Business Day.

(c)In the event that any payment of principal, interest or commitment fees due the Lenders or the Administrative Agent under any of the Loan Documents is not paid when due, the Administrative Agent is hereby authorized to effect such payment upon prior notice to the Borrowerby debiting any demand deposit account of the Borrower now or in the future maintained with the Administrative Agent.  This right of debiting accounts of the Borrower is in addition to any right of setoff accorded the Lenders hereunder or by operation of law.

2.17Loan Accounts

.  Each Lender shall open and maintain on its books a loan account in the Borrower’s name with respect to Loans made, repayments, prepayments, the computation and payment of interest and other amounts due and sums paid to such Lender hereunder and under the Loan Documents.  Except in the case of manifest error in computation, such records shall be presumed correct as to the amount at any time due to such Lender from the Borrower.  The failure of any Lender to make an entry in its loan account shall not abrogate the Borrower’s duty to repay the Indebtedness and other amounts owed to such Lender under the Loan Documents.

2.18Assignment of Loans and/or Revolving Credit Commitments Under Certain Circumstances; Duty to Mitigate

In the event (a) any Lender delivers a notice pursuant to Section 2.11 that it has become unlawful for such Lender to make or maintain Eurodollar Loans, (b) any Lender delivers a certificate requesting compensation pursuant to Section 2.12 or (c) the Borrower is required to pay any additional amount to any Lender or any Governmental Authority on account of any Lender pursuant to Section 2.13, the Borrower may, at its sole expense and effort (including with respect to the processing and recordation fee referred to in subsection 9.6(b)), upon notice to such Lender and the Administrative Agent, require such Lender to transfer and assign, without recourse (in accordance with and subject to the restrictions contained in Section 9.6), all of its interests, rights and obligations under this Agreement to a Purchasing Lender that shall assume such assigned obligations (which Purchasing Lender may be another Lender, if a Lender accepts such assignment); provided that (i) such assignment shall not conflict with any law, rule or regulation or order of any court or other Governmental Authority having jurisdiction, (ii) the Borrower shall have received the prior written consent of the Administrative Agent and the Issuing Bank, which consents shall not be unreasonably delayed or withheld, (iii) the Borrower or such Purchasing Lender shall have paid to the affected Lender in immediately available funds an amount equal to the sum of the principal of and interest accrued to the date of such payment on the outstanding Loans, plus all fees (including, without limitation, Commitment Fees) and other amounts accrued hereunder for the account of such Lender (including, without limitation, amounts owing under Sections 2.12, 2.13 and 2.14) and (iv) to the extent such affected Lender is also the Issuing Bank, (A) the Borrower or such Purchasing Lender  shall have paid to the Issuing Bankall L/C Disbursements, plus all fees (including, without limitation, Letter of Credit Fees) and other amounts accrued hereunder for the account of the Issuing Bank and (B) the Borrower shall have either (I) returned to the Issuing Bank the original of any outstanding Letters of Credit or (II) delivered to the Issuing Bank cash collateral for any such outstanding Letters of Credit in an amount equal to the Letter of Credit Coverage Requirement for each such Letter of Credit the original of which is not returned to the Issuing Bank.  Each Lender hereby grants to the Administrative Agent an irrevocable power of attorney (which power is coupled with an interest) to execute and deliver, on behalf of such Lender as assignor, any Assignment and Assumption necessary to effectuate any assignment of such LenderR 17;s interests hereunder in the circumstances contemplated by this Section 2.18.

2.19Use of Proceeds

The proceeds of the Loans may be used by the Borrower for its working capital, capital expenditures and general corporate purposes in the ordinary course of business (including paying the fees and expenses associated with the Loan Documents) and to finance all or a portion of the purchase price and transaction costs in connection with Permitted Acquisitions.  The Letters of Credit shall be letters of credit required in the ordinary course of business of the Parent’s Subsidiaries or in connection with Permitted Acquisitions.

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SECTION 3.  REPRESENTATIONS AND WARRANTIES

To induce the Administrative Agent, the Lenders and the Issuing Bank to enter into this Agreement and to make the Loans and to issue and/or participate in Letters of Credit, the Borrower hereby represents and warrants to the Administrative Agent and each Lender that:

3.1Corporate Existence

Each of the Borrower and the other Loan Parties is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, and is duly qualified or licensed to do business and is in good standing in all other jurisdictions in which the character of the properties owned or the nature of the activities conducted by it makes such qualification or licensing necessary, except where the failure to be so qualified would not reasonably be expected to have a Material Adverse Effect; provided, that Kenexa Strategic Outsourcing Corporation is not in good standing with the Comptroller of Texas on the Closing Date, but is diligently pursuing the necessary documentation to correct such issue, and Kenexa Strategic Outsourcing Corporation shall be in go od standing with the Comptroller of Texas within forty five (45) days of the Closing Date.

3.2Subsidiaries

The Subsidiaries of the Parent and the record ownership of each such Subsidiary on the date hereof are listed on Schedule 3.2 attached hereto.

3.3Authority and Binding Effect

Each of the Borrower and the other Loan Parties has all requisite power and authority, corporate and otherwise, to own, lease, encumber and operate its properties and assets and to carry on its business as now being conducted and to enter into and to perform its obligations under this Agreement, the Notes and the other Loan Documents to which it is a party and to fulfill its obligations set forth herein and therein.  The execution, delivery and performance of this Agreement, the borrowings hereunder and the execution and delivery of the Notes, the Applications and the other Loan Documents to which the Borrower or any other Loan Party is a party have been duly authorized by all requisite corporate action and will not violate or constitute a default under any Requirement of Law, or of any indenture, note, loan or credit agreement, license or any other agreement, lease or instrument to which the Parent or any of its Subsidiaries is a party or by which the Parent or any of its Subsidiaries or any of its or their Properties are bound.  This Agreement and the other Loan Documents have each been duly executed and delivered by each Loan Party party thereto.  This Agreement constitutes, and the Notes and other Loan Documents issued or to be issued hereunder, when executed and delivered pursuant hereto, will constitute, the authorized, valid and legally binding obligations of the Borrower or other Loan Party party thereto enforceable in accordance with their respective terms, except as limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws or equitable principles from time to time in effect relating to or affecting the rights of creditors generally.

3.4Approvals

No consent or approval of any trustee or holder of any indebtedness, nor any authorization, consent, approval, license, exemption of or registration, declaration or filing with any court or governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign, is or will be necessary to the valid execution and delivery of this Agreement, the Notes or the other Loan Documents or the consummation by the Borrower or the other Loan Parties of the transactions contemplated by this Agreement, except such as have been obtained.

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3.5Recording and Enforceability

No recording, filing, registration, notice or other similar action is required in order to insure the legality, validity, binding effect or enforceability of this Agreement, the Notes or the other Loan Documents as against the Borrower and any other Loan Party.

3.6Litigation

Schedule 3.6 attached hereto contains a list as of the date hereof of all litigation, claims, disputes, assessments, judgments, judicial and administrative orders outstanding against the Parent or any of its Subsidiaries and any actions, suits or proceedings at law or in equity or by or before any governmental or administrative instrumentality or other agency pending or, to the knowledge of the Borrower, threatened against the Parent or any of its Subsidiaries or affecting its or their property or rights which in any such case if decided adversely individually or in the aggregate would reasonably be expected to have a Material Adverse Effect.  Neither the Parent nor any Subsidiary is in default under any applicable statute, rule, order, certificate or regulation of any Governmental Authority having jurisdiction over the Parent or any Subsidiary thereof which default would reasonably be expected to have a Material Adverse Effect.  No litigation, investigation or proceeding of or before any arbitrator or Governmental Authority is pending or, to the knowledge of the Borrower, threatened against the Borrower, any other Loan Party or any of its or their respective Subsidiaries or against any of its or their respective business, operations, properties, prospects or condition (financial or otherwise) (a) with respect to this Agreement, the Notes, the other Loan Documents or any of the transactions contemplated hereby, or (b) as to which there is a reasonable likelihood of an adverse determination and which, if adversely determined, would reasonably be expected to have a Material Adverse Effect.

3.7Financial Information

The Borrower has delivered to the Administrative Agent true, correct and complete copies of the Parent’s audited balance sheet as of December 31, 2009 and statements of profit and loss and surplus for the year then ended which have been certified by Grant Thornton LLPand the Parent’s unaudited internally prepared balance sheet as of June 30, 2010 and statements of profit and loss and surplus for the quarter then ended.  All such financial statements have been prepared in accordance with GAAP, except for the absence of footnotes and subject to year-end adjustments in the unaudited financial statements, and are true and complete and present fairly in accordance with GAAP, the financial condition and results of operations of the Parent and its Subsidiaries as of such dates and for the periods covered thereby, and said balance sheets accurately reflect all liabilities, including contingent liabilities that are required by GAAP to be reflected thereon as of the dates thereof.  Since June 30, 2010, there has been no development or event nor any prospective development or event which individually or in the aggregate would reasonably be expected to have a Material Adverse Effect.

3.8Taxes

Each of the Parent and its Subsidiaries has filed all federal, state and local tax returns which it is required by law to file, subject to the timely filing of any extension therefor, and has paid all material taxes, assessments and other governmental charges due in respect of such returns, except to the extent that any such taxes, assessments or other governmental charges are being contested in good faith and as to which the Parent or such Subsidiary has set aside on its books adequate reserves.  No federal tax Lien has been filed against the Parent or any of its Subsidiaries.

3.9Intellectual Property

Each of the Borrower and the other Loan Parties owns, or is licensed to use, all trademarks, tradenames, copyrights, technology, know-how and processes necessary for the conduct of its business as currently conducted (the “Intellectual Property”) except for those as to which the failure to own or license would not reasonably be expected to have a Material Adverse Effect.  As of the date hereof, except as set forth on Schedule 3.9, no claim has been asserted against the Parent or any Subsidiary and is pending by any Person challenging or questioning the use of any such Intellectual Property, nor to the Borrower’s knowledge, is any such claim threatened and, with respect to any time thereafter, no such claim has been asserted which would reason ably be expected to have a Material Adverse Effect.  To the Borrower’s knowledge, the use of such Intellectual Property by the Borrower and the other Loan Parties does not infringe the rights of any Person, except for such claims and infringements that, in the aggregate, would not reasonably be expected to have such a Material Adverse Effect.

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3.10Intentionally Omitted

.

3.11Material Agreements

As of the date hereof, Schedule 3.11 attached hereto contains a list of all of the Parent’s and its Subsidiaries’ material leases, contracts, agreements, understandings and commitments of any kind the breach of which would directly or indirectly reasonably be expected to have a Material Adverse Effect and all parties (including the Parent and its Subsidiaries) to all such material leases, contracts, agreements, understandings and commitments have to the Borrower’s knowledge complied with the provisions thereof in all material respects and neither the Parent nor any of its Subsidiaries is in material default under any provision thereof and to the knowledge of the Borrower (i) no other party thereto is in default under any material provision thereof and (ii) no event has occurred which, but for the giving of notice or the passage of time, or both, would constitute a material default thereunder.

3.12Compliance With Law

Each of the Parent and its Subsidiaries is in compliance with all Requirements of Law except to the extent that the failure to comply therewith would not in the aggregate reasonably be expected to have a Material Adverse Effect.  As of the date hereof, no Loan Party has received any written notice, not heretofore complied with, from any federal, state or local authority or any insurance or inspection body to the effect that any of its properties, facilities, equipment or business procedures or practices fail to materially comply with any applicable law, ordinance, regulation, building or zoning law, or any other requirements of any such authority or body, except where such failure would not reasonably be expected to have a Material Adverse Effect.

3.13Title to Property

Each of the Parent and its Subsidiaries has good title to or valid leasehold interests in or license to use or similar interests in all personal properties, assets and other rights which it purports to own or lease or which is reflected as owned or leased on its respective books and records (except where failure to have good title to, or valid leasehold or similar interests in, would not reasonably be expected to have a Material Adverse Effect), free and clear of all Liens except Permitted Liens, and subject to the terms and conditions of the applicable leases.  Except for financing statements evidencing Permitted Liens or protective filings related to operating leases or other assets in the possession of, but not owned by, the Parent or any of its Subsidiaries, no effective financing statement under the Uniform Commercial Code is in effect in any jurisdiction and no other filing which names the Parent or any of its Subsidiaries as debtor or which covers or purports to cover any of the assets of the Parent or any of its Subsidiaries is currently effective and on file in any state or other jurisdiction.  All of the assets and properties of the Parent and its Subsidiaries that are necessary for the operation of their respective businesses are in good working condition and are able to serve the functions for which they are currently being used, except for ordinary wear and tear.

3.14Security Interests

At all times after execution and delivery of the Security Documents by the Loan Party or Loan Parties party thereto and completion of the filings and recordings (to the extent not already filed and recorded prior to the Closing Date) in the jurisdictions listed on Schedule 3.14, and delivery to the Administrative Agent of possession or control, as applicable, of all Collateral the perfection of a security interest in which requires possession or control under the Uniform Commercial Code, the security interests created for the benefit of the Administrative Agent and the Lenders pursuant to the Security Documents will constitute valid, perfected security interests in the Collateral subject thereto, subject to no other Liens whatsoever, except Permitted Liens.

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3.15Federal Regulations

No part of the proceeds of any Loans will be used for “purchasing” or “carrying” any “margin stock” within the respective meanings of each of the quoted terms under Regulation U or for any purpose which violates the provisions of Regulation U or any other Regulations of the Board of Governors of the Federal Reserve System.  If requested by any Lender or the Administrative Agent, the Borrower will furnish to the Administrative Agent and each Lender a statement to the foregoing effect in conformity with the requirements of FR Form U-l referred to in said Regulation U.  No part of the proceeds of the Loans hereunder will be used for any purpose which violates, or which is inconsistent with, the provisions of any of Regulations D, T, U and X.

3.16ERISA

Except as specifically disclosed on Schedule 3.16 to this Agreement:  (a) there is no Accumulated Funding Deficiency with respect to any Employee Pension Plan, (b) no Reportable Event (excluding those for which notice has been waived by the PBGC) has occurred with respect to any Employee Pension Plan, (c) neither the Parent nor any Commonly Controlled Entity has incurred Withdrawal Liability with respect to any Multiemployer Plan, and (d) no Multiemployer Plan is in Reorganization.  No liability (whether or not such liability is being litigated) in excess of $250,000 has been asserted against the Parent or any Commonly Controlled Entity in connection with any Employee Pension Plan or any Multiemployer Plan by the PBGC, by a trustee appointed pursuant to S ection 4042(b) or (c) of ERISA, or by a sponsor or an agent of a sponsor of a Multiemployer Plan, and no Lien has been attached and no Person has, to the Borrower’s knowledge, threatened to attach a Lien on any of the Parent’s or any Commonly Controlled Entity’s property as a result of failure to comply with ERISA or as a result of the termination of any Employee Pension Plan.  Each Employee Pension Plan, as most recently amended, including amendments to any trust agreement, group annuity or insurance contract, or other governing instrument, is the subject of a favorable determination by the Internal Revenue Service with respect to its qualification under Section 401(a) of the Code, and to the knowledge of the Borrower, no amendment adopted after such determination negatively affects the qualification of such Plan.  Neither the Parent nor any Commonly Controlled Entity has an unfulfilled obligation to contribute to any Multiemployer Plan.

3.17Fictitious Names

Neither the Parent nor its Subsidiaries operate or do business under any assumed, trade or fictitious names, other than as listed on Schedule 3.17, or if after the date hereof, disclosed to the Administrative Agent in writing.

3.18No Event of Default

No Default or Event of Default has occurred and is continuing.

3.19Solvency

Each of the Parent and its Subsidiaries is, and after receipt and application of any Loans hereunder, including the initial Loans will be, Solvent.

3.20Investment Company Act

Neither the Parent nor any Subsidiary thereof is an “investment company”, or a company “controlled” by an “investment company”, within the meaning of the Investment Company Act of 1940, as amended.

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3.21Environmental Matters

Except to the extent that all of the following would not reasonably be expected to have a Material Adverse Effect:

(a)The Properties do not contain, and have not previously contained, in, on, or under, including, without limitation, the soil and groundwater thereunder, any Materials of Environmental Concern in amounts or concentrations that constitute or constituted a violation of, or reasonably would reasonably be expected to give rise to liability under Environmental Laws.

(b)The Properties and all operations and facilities at the Properties are in compliance, and have in the last five years been in compliance with all Environmental Laws, and there is no contamination at, under or about the Properties or violation of any Environmental Law with respect to the Properties or the business operated by the Parent and its Subsidiaries which would reasonably be expected to interfere with the continued operation of any of the Properties or impair the fair saleable value of any thereof.  Neither the Parent nor any Subsidiary has assumed any liability of any Person under Environmental Laws.

(c)Neither the Parent nor any Subsidiary has received nor is it aware of any claim, notice of violation, alleged violation, non-compliance, investigation or advisory action or potential liability regarding environmental matters or compliance of Environmental Law with regard to the Properties which has not been satisfactorily resolved by the Parent or its Subsidiary and neither the Parent nor any Subsidiary is aware and has no reason to believe that any such action is being contemplated, considered or threatened.

(d)Materials of Environmental Concern have not been generated, treated, stored, transported, disposed of, at, on, from or under any of the Properties by the Parent or any of its Subsidiaries, nor have any Materials of Environmental Concern been transferred by the Parent or any of its Subsidiaries from the Properties to any other location except in either case in the ordinary course of business of the Parent and its Subsidiaries in compliance with all Environmental Laws and such that it would not reasonably be expected to give rise to liability under any applicable Environmental Law.

(e)There are no governmental, administrative actions or judicial proceedings pending or, to the best knowledge of the Borrower, contemplated or threatened under any Environmental Laws to which the Parent or any of its Subsidiaries is or will be named as a party with respect to the Properties, nor are there any consent decrees or other decrees, consent orders, administrative orders or other orders, or other administrative or judicial requirements outstanding under any Environmental Law with respect to any of the Properties.

3.22Labor Matters

Except as set forth on Schedule 3.22, as of the Closing Date, there are no collective bargaining agreements or Multiemployer Plans covering the employees of the Parent or its Subsidiaries, and neither the Parent nor its Subsidiaries has suffered any strikes, walkouts, work stoppages or other material labor difficulty within the last five years and to the knowledge of the Borrower, there are none now threatened.

3.23Anti-Terrorism Laws

                                                (a)  Neither the Parent, its Subsidiaries nor, to the Borrower’s knowledge, their Affiliates are in violation of any Anti-Terrorism Law nor does the Parent or its Subsidiaries engage in or conspire to engage in any transaction  that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in any Anti-Terrorism Law.

(b)Executive Order No. 13224.  Neither the Parent, its Subsidiaries nor, to the Borrower’s knowledge, any of their Affiliates or agents acting or benefiting in any capacity in connection with the extensions of credit or other transactions hereunder, is any of the following (each a “Blocked Person”):

(i)a Person that is listed in the annex to, or is otherwise subject to the provisions of, Executive Order No. 13224;

(ii)a Person owned or controlled  by, or acting for or on behalf of, any Person that is listed in the annex to, or is otherwise subject to the provisions of, Executive Order No. 13224;

(iii)a Person or entity with which any Lender is prohibited from dealing or otherwise engaging in any transaction by any Anti-Terrorism Law;

(iv)a Person or entity that commits, threatens or conspires to commit or supports “terrorism” as defined in Executive Order No. 13224;

(v)a Person or entity that is named as a “specially designated national” on the most current list published by the U.S. Treasury Department Office of Foreign Asset Control at its official website or any replacement website or other replacement official publication of such list; or

(vi)a person or entity who is affiliated or affiliated with a person or entity listed above.

The Parent does not nor, to the Borrower’s knowledge, does any of the Parent’s Subsidiaries, Affiliates or agents acting in any capacity in connection with the extensions of credit hereunder or other transactions hereunder (x) conduct any business or engage in making or receiving any contribution of funds, goods or services to or for the benefit of any Blocked Person, or (y) deal in, or otherwise engage in any transaction relating to, any property or interests in property blocked  pursuant to the Executive Order No. 13224.

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3.24[INTENTIONALLY OMITTED]

.

3.25No Burdensome Agreements

Neither the Parent nor any Subsidiary thereof is a party to or bound by any agreement or instrument or subject to any corporate or other restriction the performance or observance of which now has or, as far as the Borrower can reasonably foresee, would reasonably be expected to have, a Material Adverse Effect.

3.26No Misrepresentations or Material Nondisclosures

Neither this Agreement nor any other document, certificate or statement furnished to the Administrative Agent or the Lenders in connection herewith contains any untrue statement of a material fact or omits to state a material fact necessary in order to make the statements contained herein and therein not misleading.  As of the Closing Date, there is no fact known to the Borrower which now or in the future (so far as the Borrower can reasonably foresee) would reasonably be expected to have a Material Adverse Effect which has not been set forth in this Agreement or in the other documents, certificates and statements furnished to the Lenders in connection with the transactions contemplated hereby.

All of the foregoing representations and warranties shall survive the execution and delivery of the Revolving Credit Notes and the making by the Lenders of the Loans and issuance of Letters of Credit hereunder and shall continue in full force and effect so long as any indebtedness or obligation of the Borrower to the Lenders and/or the Administrative Agent hereunder or under the other Loan Documents is outstanding or unperformed or this Agreement remains in effect.

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SECTION 4.  CONDITIONS PRECEDENT

4.1Conditions to Closing

The agreement of each Lender to enter into this Agreement and to make the initial Loans requested to be made and the Issuing Bank and each Revolving Credit Lender to issue and/or participate in Letters of Credit requested to be issued on the Closing Date is subject to the satisfaction on and as of the Closing Date of the following conditions precedent:

(a)Credit Agreement and Revolving Credit Notes.  The Administrative Agent shall have received (i) this Agreement, (A) executed and delivered by a duly authorized officer of the Borrower, with a counterpart for each Lender, and (B) executed and delivered by a duly authorized officer of the Administrative Agent and each Lender, (ii) for the account of each Lender, a Revolving Credit Note with each such Revolving Credit Note conforming to the requirements hereof and executed by a duly authorized officer of the Borrower.

(b)Other Loan Documents.  The Administrative Agent shall have received each of the Security Documents and other Loan Documents duly executed and delivered by each party thereto (including any stock certificates and undated stock powers ).  Any document (including without limitation UCC financing statements) required to be filed, registered or recorded in order to create, in favor of the Administrative Agent for the benefit of the Lenders, a perfected, first priority Lien (subject only to Permitted Liens), shall have been filed, registered or recorded and/or properly prepared for filing, registration or recording in each office in each jurisdiction in which such filings, registration and recordation are required to perfect such first priority security interests created by the Security Documents, and the Administrative Agent shall be satisfied that all such recordings and filings have been or will be completed promptly following the Closing Date and that all necessary filing, recording and other fees and all taxes and expenses related to such filings, registrations and recordings have been or will be paid in full by the Borrower.

(c)Loan Party Certificates.  The Administrative Agent shall have received a certificate of the Secretary or Assistant Secretary of the Borrower and the other Loan Parties certifying the resolutions of the board of directors of such Person and true and correct copies of the certificate or articles of incorporation, bylaws or other applicable governing documents of such Person and the signatures and incumbency of the officers of such Person authorized to sign the Loan Documents to which it is a party, and such certificates and attachments thereto shall be in form and substance satisfactory to the Administrative Agent.

(d)[INTENTIONALLY OMITTED]

(e)Fees.  Each of the Administrative Agent and the Lead Arranger shall have received all fees to be received by it individually or on behalf of the Lenders on the Closing Date pursuant to the Fee Letter.

(f)Legal Opinions.  The Administrative Agent shall have received the executed legal opinion(s) of Pepper Hamilton, LLP, counsel to the Borrower and the other Loan Parties and such other opinions (if any) as shall be required by the Administrative Agent.  Such opinion shall be addressed to the Lenders and the Administrative Agent and cover such matters incident to the transactions contemplated by this Agreement as the Administrative Agent may reasonably require.

(g)UCC Filing and Other Searches.  The Administrative Agent shall have received the results of (i) Uniform Commercial Code searches made with respect to each of the Parent, the Borrower, the other Loan Parties, together with copies of financing statements disclosed by such searches and (ii) such tax and judgment lien searches as the Administrative Agent shall reasonably request, and each of the foregoing searches shall disclose no Liens, except for Permitted Liens or, if unpermitted Liens are disclosed, the Administrative Agent shall have received satisfactory evidence of the release of such Liens.

(h)Insurance.  The Administrative Agent shall have received certificates of insurance with respect to the Parent’s, the Borrower’s and the other Loan Parties’ fire, casualty, liability and other insurance covering its respective property and business, including lender loss payee endorsements in favor of the Administrative Agent on Acord Form 27.

(i)Good Standing.  The Administrative Agent shall have received certificates of good standing, subsistence and/or status dated a recent date from the Secretary of State or appropriate authorities in the state of formation of each of the Borrower and the other Loan Parties.

(j)No Material Adverse Effect; Closing Certificate.  No Material Adverse Effect shall have occurred since June 30, 2010.  The Administrative Agent shall have received a certificate from the Borrower and the other Loan Parties, dated as of the Closing Date, and executed by a Responsible Officer of such party stating that, as of the Closing Date (i) all of the representations and warranties made by such party herein and in the other Loan Documents are true and correct in all material respects (except that representations and warranties that expressly relate to an earlier date are true and correct in all m aterial respects as of such date), (ii) no Default or Event of Default exists and (iii) no Material Adverse Effect has occurred since June 30, 2010.

(k)Governmental Approvals.  The Administrative Agent shall have received evidence that any necessary authorizations from any Governmental Authority for the consummation of the transactions contemplated hereby have been obtained.

(l)[INTENTIONALLY OMITTED].

(m)[INTENTIONALLY OMITTED].

(n)Compliance Certificate.  The Borrower shall have delivered to the Administrative Agent a Compliance Certificate demonstrating compliance with the covenants herein.

(o)Financial Statements and Projections.  The Borrower shall have delivered to the Administrative Agent and the Lenders (i) consolidated pro forma financial statements for the Parent and its Subsidiaries for the fiscal quarters ended March 31, 2010 and June 30, 2010 and (ii) consolidated financial projections on an annual basis for the 2010 fiscal year and for each fiscal year ending thereafter through and including the 2013 fiscal year .

(p)[INTENTIONALLY OMITTED].

(q)Principal Deposit Accounts.  The Borrower and the other Loan Parties shall have established their principal deposit accounts at PNC.

(r)Additional Matters.  All corporate and other proceedings, and all documents, instruments and other legal matters in connection with the transactions contemplated by this Agreement and the other Loan Documents shall be satisfactory in form and substance to the Administrative Agent, and the Administrative Agent shall have received such other documents and legal opinions in respect of any aspect or consequence of the transactions contemplated hereby or thereby as it shall reasonably request.

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4.2Conditions to Each Loan or Letter of Credit

The agreement of each Lender to make any Loan requested to be made by it and of the Issuing Bank and each Revolving Credit Lender to issue and/or participate in Letters of Credit requested to be issued on any date (including the Closing Date) is subject to the satisfaction of the following conditions precedent:

(a)Representations and Warranties.  Each of the representations and warranties made by the Borrower or any other Loan Party herein or under the other Loan Documents shall be true and correct in all material respects on and as of such date as if made on and as of such date (except to the extent that such representations and warranties relate expressly to an earlier date in which case such representations and warranties shall be true and correct in all material respects as of such earlier date).

(b)No Default.  No Default or Event of Default shall have occurred and be continuing on such date or after giving effect to the making of such Loan or issuing such Letter of Credit.

(c)No Material Adverse Effect.  At the time of making such Loan or issuing such Letter of Credit, no Material Adverse Effect shall have occurred and be continuing.

Each request by the Borrower for a Loan or Letter of Credit hereunder shall constitute a representation and warranty by the Borrower as of the date thereof that the conditions contained in this Section 4.2 have been satisfied.

4.3Closing

The closing (the “Closing”) of the transactions contemplated hereby shall take place at the offices of Ballard Spahr LLP, 1735 Market Street, Philadelphia, PA 19103, commencing at 10:00 A.M., Philadelphia time, on August 31, 2010, or such other place or date as to which the Administrative Agent, the Lenders and the Borrower shall agree.  The date on which the Closing shall be completed is referred to herein as the “Closing Date”.

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SECTION 5.  AFFIRMATIVE COVENANTS

The Borrower hereby agrees that, so long as the Revolving Credit Commitments remain in effect, any Note or Letter of Credit remains outstanding and unpaid, or any other amount is owing to any Lender or the Administrative Agent hereunder or under any other Loan Document, the Borrower shall and (except in the case of delivery of financial information, reports and notices) shall cause the Parent and each of its other Subsidiaries to:

5.1Furnishing Financial Statements

Furnish or cause to be furnished to the Administrative Agent:

(a)as soon as available, but in any event not later than 90 days (or such earlier date mandated by the SEC) after the close of each fiscal year of the Parent, a copy of the annual audit report for such year for the Parent and its consolidated Subsidiaries, including therein a consolidated balance sheet of the Parent and its consolidated Subsidiaries as at the end of such fiscal year, and related consolidated statements of income and retained earnings and changes in cash flows of the Parent and its consolidated Subsidiaries for such fiscal year, all in reasonable detail, prepared in accordance with GAAP applied on a basis consistently maintained throughout the period involved and with the prior year with such changes thereon as shal l be approved by the Parent’s independent certified public accountants, such financial statements to be certified by Grant Thornton LLPor other nationally recognized independent certified public accountants selected by the Parent and reasonably acceptable to the Administrative Agent, without a “going concern” or like qualification or exception or qualification arising out of the scope of the audit;

(b)as soon as available, but in any event not later than 45 days after the end of each fiscal quarter of the Parent (other than the last fiscal quarter), unaudited consolidated financial statements of the Parent and its consolidated Subsidiaries, including therein (i) a consolidated balance sheet of the Parent and its consolidated Subsidiaries as at the end of such fiscal quarter, (ii) the related consolidated statements of income and retained earnings of the Parent and its consolidated Subsidiaries, and (iii) the related consolidated statement of changes in cash flows of the Parent and its consolidated Subsidiaries all for the period from the beginning of such fiscal quarter to the end of such fiscal quarter and the portion of the fiscal year through the end of such quarter setting forth in each case in comparative form the corresponding figures for the like period of the preceding fiscal year; all in reasonable detail, prepared in accordance with GAAP applied on a basis consistently maintained throughout the period involved and with prior periods (except for the absence of footnotes and subject to year-end adjustments) and accompanied by a certificate of a Responsible Officer of the Parent stating that the financial statements fairly present the financial condition of the Parent and its consolidated Subsidiaries as of the date and for the periods covered thereby;

The financial statements required to be delivered pursuant to clauses (a) and (b) of this Section 5.1 shall be deemed to have been delivered on the date on which such report is posted on the website of the Securities and Exchange Commission at www.sec.gov and Borrower notifies Administrative Agent in writing thereof.

(c)concurrently with the delivery of:

(i)the financial statements referred to in subsection 5.1(a), a certificate of the Parent’s independent certified public accountants reporting on such financial statements stating that in making the examination necessary for certifying such financial statements no knowledge was obtained of any Event of Default under Section 6.1 hereof, except as specifically indicated;

(ii)the annual and quarterly financial statements referred to in subsections 5.1(a) and 5.1(b), respectively, a certificate of a Responsible Officer of the Borrower (each a “Compliance Certificate”) showing in detail the calculations demonstrating compliance with the financial covenants set forth in Section 6.1 together with a certificate of a Responsible Officer of the Borrower stating that, to his or her knowledge, the Borrower during such period has kept, observed, performed and fulfilled each and every covenant and condition contained in this Agreement and in the Notes and the other Loan Documents to which it is a party and that such officer has o btained no knowledge of any Default or Event of Default except as specifically indicated; if the Compliance Certificate shall indicate that such officer has obtained knowledge of a Default or Event of Default, such Compliance Certificate shall state what efforts the Borrower is making to cure such Default or Event of Default; and

(iii)the financial statements referred to in subsections 5.1(a) and 5.1(b), sufficient financial information to permit the Lenders to calculate Modified EBITDA, including with respect to any Person who has (or whose assets have) been acquired in a Permitted Acquisition and who is (or whose assets have been) owned for less than four (4) full fiscal quarters, calculations on a quarterly basis of the EBITDA attributable to such Person (or such assets) for the applicable period prior to such acquisition.

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(d)any reports, including management letters, promptly after their submittal to the Parent by its independent accountants in connection with any annual, interim or special audit;

(e)promptly, such additional financial and other information as the Administrative Agent or any Lender may from time to time reasonably request;

(f)promptly after the same are available, quarterly account statements with respect to each Unrestricted Investment Account demonstrating the amount of cash and/or Cash Equivalents maintained in such Unrestricted Investment Accounts by the Parent and/or its Subsidiaries during such quarter;

(g)promptly following the execution thereof, a copy of any letter of intent executed by the Borrower or any other Loan Party in respect of a proposed acquisition for which the proposed Consideration is $10,000,000 or more;

(h)any reports, notices or proxy statements generally distributed by the Parent to its stockholders on a date no later than the date supplied to such stockholders;

(i)simultaneously with the delivery of the financial statements required under subsection 5.1(a), but in any event on or before ninety (90) days after the end of each fiscal year, (i) a budget for the current fiscal year (and, if available, for the next fiscal year) approved by the board of directors of the Parent(each a “Budget”), and copies of any updates to such Budget prepared by or for any Loan Party and (ii) projections through the Revolving Credit Termination Date; and promptly upon request, such additional or updated Budgets, projections, reports (including inventory reports) a nd other information regarding the operations, business affairs and financial condition of the Borrower and the other Loan Parties as the Required Lenders may, from time to time, reasonably request;

(j)[INTENTIONALLY OMITTED].

(k)promptly after the same become publicly available, copies of all periodic, other reports, proxy statements or other materials filed by the Parent or any Subsidiary thereof with the SEC, or any Governmental Authority succeeding to any or all of the functions of the SEC, or with any national securities exchange, or distributed to its equityholders, as the case may be.

All balance sheets, statements and other information furnished pursuant hereto shall be prepared in accordance with GAAP, except for the absence of footnotes and subject to year-end adjustments in the case of the unaudited financial statements, and shall fairly set forth the consolidated financial condition of the Parent and its Subsidiaries and the results of their operations.  The Lenders shall have the right, from time to time, to discuss the Loan Parties’ affairs directly with the Parent’s independent certified public accountants after notice to the Borrower and the opportunity for the Borrower to be present at any such discussions.  The Administrative Agent and each Lender is authorized to show or deliver a copy of any financial statement or any other information relating to the business, operations or financial condition of the Parent and its Subsidiaries which may be furnished to any Lender or come to its attention pursuant to this Agreement or otherwise, to any regulatory body or agency having jurisdiction over such Lender and to any bank or other financial institution which is a present or potential participant with such Lender in the Loans and other extensions of credit hereunder, provided such bank or financial institution agrees to keep such information confidential on the terms hereof.

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5.2Books and Records

Maintain proper and complete books and records of account in which shall be set forth accurately and in accordance with GAAP, all of its dealings and transactions.

5.3Taxes

Pay when due all taxes, assessments, charges and levies imposed upon it or any of its properties or which it is required to withhold and pay over, and provide evidence of such payment to the Administrative Agent if requested, except where such taxes, assessments or charges shall be contested in good faith by appropriate proceedings and where adequate reserves therefor have been set aside on its books, provided that the Parent and its Subsidiaries shall pay or cause to be paid all such taxes, assessments, charges, and levies forthwith whenever foreclosure on any Lien that attaches (or security therefor) appears imminent.

5.4Corporate Existence and Rights; Compliance with Laws

Preserve and keep in full force and effect its corporate existence, rights, permits, patents, franchises, licenses, trademarks and trade names and other Intellectual Property and comply with any and all laws, regulations, rules or requirements of any federal agency or department and of any state, local or municipal government, agency or department which may at any time be applicable to it, except to the extent failure to do so would not reasonably be expected to have a Material Adverse Effect.

5.5Maintenance of Properties

Maintain all of its tangible property (except for obsolete property not yet disposed of) in good repair, working order and condition and, from time to time, make all appropriate and proper repairs, renewals, replacements, additions and improvements thereto, except to the extent failure to do so would not reasonably be expected to have a Material Adverse Effect.

5.6Performance and Compliance with Material Agreements

Perform and comply with each of the provisions of all Loan Documents and, except to the extent failure to do so would not otherwise cause an Event of Default or would not reasonably be expected to have a Material Adverse Effect, all other material agreements.

5.7Insurance

.  Carry at all times, in coverage, form and amount reasonably satisfactory to the Administrative Agent (and, in any event in such amounts and covering such risks as is consistent with sound business practice and other similarly situated companies), hazard insurance and business interruption coverage (with fire, extended coverage, vandalism, malicious mischief coverage and business interruption coverage and coverage against such other hazards as are customarily insured against by companies in the same or similar business), comprehensive general liability insurance, worker’s compensation insurance, comprehensive automobile liability insurance and such other insurance as may be required by the Loan Documents and as the Administrative Agent may from time to time reasonably require, and pay all premiums on the policies for suc h insurance when and as they become due and do all other things necessary to maintain such policies in full force and effect.  The Borrower shall from time to time upon request by the Administrative Agent or the Required Lenders, promptly furnish or cause to be furnished to the Administrative Agent or the Lenders evidence in form and substance satisfactory to the Administrative Agent or the Required Lenders, of the maintenance of all insurance required to be maintained by this Section 5.7 including, but not limited to, such originals or copies as the Administrative Agent or the Required Lenders may request of policies, certificates of insurance, riders and endorsements relating to such insurance and proof of premium payments.  The Borrower shall cause all hazard insurance policies and any policies insuring the inventory and equipment covered by the Security Agreement to provide, and the insurers issuing such policies to certify to the Lenders, that (a) the interest of the Administrat ive Agent shall be insured regardless of any breach or violation by the Parent or any Subsidiary thereof or the holder or owner of the policies of any warranties, declarations and conditions contained in such policies; (b) if such insurance be proposed to be canceled or materially changed for any reason whatsoever, such insurer will promptly notify the Administrative Agent and such cancellation or change shall not be effective as to the Administrative Agent for thirty (30) days after receipt by the Administrative Agent of such notice, unless the effect of such change is to extend or increase coverage under the policy; (c) the Administrative Agent and the Lenders will have the right at their election to remedy any default in the payment of premiums within thirty (30) days of notice from the insurer of such default; and (d) loss payments in each instance will be payable to the Administrative Agent as secured party, or otherwise as its or the Lenders’ interests may appear.  The Ad ministrative Agent, its officers, employees and authorized agents, are hereby irrevocably appointed attorneys-in-fact of the Borrower to endorse any draft or check which may be payable to the Administrative Agent, in order to collect the proceeds of such insurance covering the collateral and distribute the same as the Required Lenders may determine; provided that, if at the time of receipt of any such proceeds no Event of Default has occurred and is continuing, such proceeds shall be released to the Borrower to pay the costs of repairing, restoring or replacing the assets lost, damaged or destroyed.

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5.8Inspection; Collateral Audit

Permit any representative of the Administrative Agent and the Lenders to visit and inspect any of its properties, to examine its books of account and other records and files, to make copies thereof, and to discuss their affairs, business, finances and accounts with its officers and employees, all at such reasonable times and as often as the Administrative Agent or any Lender may reasonably request, provided that such inspections shall not unreasonably interfere with the conduct of the Loan Parties’ business. All reasonable costs incurred by the Administrative Agent and the Lenders in connection with up to two (2) such inspections conducted in any calendar year shall be paid by the Borrower; provided, however, the Borrower also shall pay all such costs in connection with any such inspections during the existence of a Default or Event of Default.  The inspections are solely for the protection of the Administrative Agent and the Lenders and no action or inaction of the Administrative Agent or the Lenders shall constitute any representation that the Borrower is in compliance with the terms of this Agreement or that the Administrative Agent or the Lenders approve of the Loan Parties’ affairs, business, finances or accounts.

5.9Leases and Mortgages

Pay all rent or other sums required by any lease or mortgage to which it is a party as the same becomes due and payable, duly perform and comply with all of its other obligations as tenant or mortgagor thereunder, except to the extent that any such obligation is the subject of a good faith dispute and adequate reserves have been set aside therefor, and keep all such leases in full force and effect, except to the extent the absence or loss of such lease would not reasonably be expected to have a Material Adverse Effect.

5.10Pay Indebtedness and Perform Other Covenants

Make full and timely payment of the principal of, and interest on, the Notes, the Reimbursement Obligations, the Commitment Fees and (except to the extent non-payment of such Indebtedness would not violate Section 7.1(f)) all other Indebtedness of the Loan Parties, whether now existing or hereafter arising, and duly comply with all covenants and agreements set forth in or required pursuant to any other agreement or document previously, concurrently or hereafter executed or delivered by the Loan Parties in connection with this Agreement, except that the Loan Parties may contest in good faith after making appropriate reserves therefor amounts owing in respect of Indebtedness other than Indebtedness arising under the Loan Documents.

5.11Notices

Promptly give notice to the Administrative Agent on behalf of the Lenders of:

(a)as soon as the Borrower has knowledge, the occurrence of any Default or Event of Default;

(b)any (i) default or event of default under any material Contractual Obligation of the Parent or any of its Subsidiaries or (ii) litigation, investigation or proceeding which may exist at any time between the Parent or any of its Subsidiaries and any Governmental Authority, which in either case, if not cured or if adversely determined, as the case may be, would reasonably be expected to have a Material Adverse Effect or result in a liability in excess of $500,000;

(c)any litigation or proceeding which could give rise to a liability of the Parent or any of its Subsidiaries of $500,000 or more and not covered by insurance as reasonably determined by the Borrower’s corporate counsel or in which injunctive or similar relief is sought;

(d)the occurrence or existence of a material default by any party, including the Parent or any of its Subsidiaries, to any material contract to which the Parent or a Subsidiary is a party, or the actual or threatened termination, revocation or non-renewal of any such material contract;

(e)entry of any order, judgment, decree or decision issued by any court, arbitrator or Governmental Authority in any proceeding to which the Parent or any of its Subsidiaries is a party and which would individually or in the aggregate reasonably be expected to have a Material Adverse Effect; and

(f)any other event which, to the Borrower’s knowledge, has had or would reasonably be expected to have a Material Adverse Effect.

Each notice pursuant to this subsection shall be accompanied by a statement of a Responsible Officer of the Borrower setting forth details of the occurrence referred to therein and stating what action the Borrower proposes to take with respect thereto.  Upon the request of the Administrative Agent, the Borrower shall send (or cause to be sent) to the Administrative Agent and/or the Lenders copies of all Federal, state, local and foreign tax returns and reports filed by the Parent or any of its Subsidiaries in respect of taxes measured by income.

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5.12Deposit Accounts

Maintain its principal domestic deposit accounts with PNC.

5.13ERISA

(a)  Furnish to the Administrative Agent (a) promptly and in any event within 30 days after it has knowledge that it or any Affiliate has incurred Withdrawal Liability, or that any Multiemployer Plan is in Reorganization or that any Reportable Event or Foreign Benefit Event has occurred with respect to any Employee Pension Plan or that PBGC has instituted or will institute proceedings under Title IV of ERISA to terminate any Employee Pension Plan or to appoint a trustee to administer any Employee Pension Plan, a statement setting forth the amount of such Withdrawal Liability, the details of the Reorganization, Reportable Event, Foreign Benefit Event or termination or appointment proceedings and the action which it (or the Multiemployer Plan sponsor or Employee Pension Plan sponsor if other t han the Parent) proposes to take with respect thereto, together with a copy of any notice of Withdrawal Liability or Reorganization given to the Parent or any Affiliate and a copy of the notice of such Reportable Event given to PBGC or a copy of the notice of such Foreign Benefit Event, in each case, if a copy of such notice is reasonably available to the Borrower or any of its Affiliates, (b) promptly after receipt thereof, a copy of any notice (i) the Parent or any of its Affiliates or the sponsor of any Employee Pension Plan receives from PBGC or the Internal Revenue Service which sets forth or proposes any negative action or determination with respect to such Employee Pension Plan, and (ii) the Parent, any of its Subsidiaries or the sponsor of any Foreign Benefit Plan receives from any Governmental Authority regulating such Foreign Benefit Plan which sets forth or proposes any action or determination with respect to such Foreign Benefit Plan, (c) promptly, and in any event within fift een (15) days after receipt thereof, a copy of any Adjusted Funding Target Attainment Percentage certification by an Employee Pension Plan actuary if such certification reflects an Adjusted Funding Target Attainment Percentage of less than 80%, and (d) promptly and in any event within fifteen (15) days of the date on which such certification should have been received, a notice of the failure to receive an actuarial certification of the Adjusted Funding Target Attainment Percentage.  The Borrower will promptly notify the Administrative Agent of any excise taxes which have been assessed against the Parent or any of its Subsidiaries or any of its Affiliates by (x) the Internal Revenue Service with respect to any Employee Pension Plan or Multiemployer Plan or (y) the applicable Government Authority regulating any Foreign Benefit Plan.  Within the time required for notice to the PBGC under Section 303(k)(4) of ERISA or 430(k)(4)(A) of the Code, the Borrower will notify the Admin istrative Agent of any Lien of which the Borrower has knowledge arising under Section 303(k) of ERISA or 430(k) of the Code in favor of any Employee Pension Plan.  The Borrower will promptly notify the Administrative Agent of the following events, and in any event within 30 days after the Borrower knows or has reason to know thereof: (i) a failure to make any required contribution to an Employee Pension Plan or a Foreign Benefit Plan, any Lien in favor of PBGC, a Plan or a Foreign Benefit Plan, or any withdrawal from, or the termination, Reorganization or Insolvency of, any Multiemployer Plan or (ii) assessment of liability under the Coal Industry Retiree Health Benefit Act of 1992.

5.14Environmental Laws.

(a)Comply with, and require compliance by all tenants and all subtenants, if any, with, all Environmental Laws and obtain and comply with and maintain, and require that all tenants and subtenants obtain and comply with and maintain, any and all licenses, approvals, registrations or permits required by Environmental Laws, except to the extent that failure to so comply or obtain or maintain such documents would not reasonably be expected to have a Material Adverse Effect;

(b)Comply with all lawful and binding orders and directives of all Governmental Authorities respecting Environmental Laws, except to the extent the failure to so comply would not reasonably be expected to have a Material Adverse Effect; and

(c)Defend, indemnify and hold harmless the Administrative Agent and the Lenders, and their respective Affiliates, employees, agents, advisors, officers, directors, successors and assigns (each, an “Indemnitee”) from and against any claims, demands, penalties, fines, liabilities, settlements, damages, costs and expenses of whatever kind or nature known or unknown, contingent or otherwise, arising out of, or in any way relating to any violation of or noncompliance with or liability under any Environmental Laws, or any orders, requirements or demands of Governmental Authorities related thereto which in each case relate to or arise in connection with the Paren t, any Subsidiaries thereof, any Property or any activities relating to any property or business of the Parent or any Subsidiaries thereof or the enforcement of any rights provided herein or in the other Loan Documents, including, without limitation, attorneys’ and consultants’ fees, response costs, investigation and laboratory fees, court costs and litigation expenses, except to the extent that any of the foregoing arise out of the gross negligence or willful misconduct of such Indemnitee.  This indemnity shall continue in full force and effect regardless of the termination of this Agreement and the payment of the Notes and other Obligations.

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5.15Notice and Joinder of New Subsidiaries

Notify the Administrative Agent as soon as practicable after acquiring or creating a new Subsidiary, and cause

(a)(i) any new Domestic Subsidiary to execute and deliver to the Administrative Agent (A) a Guaranty (or Joinder, as determined by the Administrative Agent) in form and substance acceptable to the Administrative Agent pursuant to which it shall guaranty all of the Obligations and (B) a Security Agreement (or Joinder, as determined by the Administrative Agent) in form and substance satisfactory to the Administrative Agent pursuant to which such Domestic Subsidiary shall grant a security interest to the Administrative Agent in its assets as additional Collateral for the Obligations and (ii) the owner of such Domestic Subsidiary to execute and deliver a Pledge Agreement (or Joinder as determined by the Administrati ve Agent) in form and substance acceptable to the Administrative Agent pursuant to which all of the Capital Stock in such Domestic Subsidiary shall be pledged to the Administrative Agent, for the benefit of the holders of the Obligations, as Collateral for the Obligations.

(b)any Domestic Subsidiary that is the owner of any new first-tier Foreign Subsidiary to execute and deliver to the Administrative Agent a Pledge Agreement (or Joinder as determined by the Administrative Agent) in form and substance reasonably acceptable to the Administrative Agent pursuant to which sixty-five percent (65%) of the issued and outstanding Capital Stock of such Foreign Subsidiary (to the extent owned by the Parent or a Domestic Subsidiary) shall be pledged to the Administrative Agent, for the benefit of the holders of the Obligations, as Collateral for the Obligations.

(c)in connection with any such Guaranties, Security Agreements, Pledge Agreements and/or Joinders, the Parent, the Borrower and/or the applicable Subsidiary or Subsidiaries to execute and deliver or cause to be executed and delivered such additional documentation as the Administrative Agent shall reasonably require, including without limitation, certificates similar to those referred to in subsection 4.1(c), opinions and stock certificates, if any, evidencing such Capital Stock (together with undated stock powers endorsed in blank).

5.16Anti-Terrorism Laws

Neither the Parent, the Borrower nor their Affiliates, Subsidiaries and agents shall (a) conduct any business or engage in any transaction or dealing with any Blocked Person, including the making or receiving of any contribution of funds, goods or services to or for the benefit of any Blocked Person, (b) deal in, or otherwise engage in any transaction relating to, any property or interests in property blocked pursuant to Executive Order No. 13224; or (c) engage in or conspire to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in Executive Order No. 13224 or the USA Patriot Act.  The Borrower shall deliver to the Administrative Agent any certification or other evidence requested from time to time by the Administrative Agent in it s sole discretion, confirming Borrower’s compliance with this Section 5.16.

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SECTION 6.  NEGATIVE COVENANTS

The Borrower hereby agrees that, so long as the Revolving Credit Commitments remain in effect, any Note or Letter of Credit remains outstanding and unpaid, or any other amount is owing to any Lender or the Administrative Agent hereunder or under any other Loan Document, the Borrower shall not, and shall not permit the Parent or any of its Subsidiaries to, directly or indirectly:

6.1Financial Covenants.

(a)Total Leverage Ratio.  Permit, as of the last day of any fiscal quarter, commencing with the fiscal quarter ending September 30, 2010, the Total Leverage Ratio to exceed 2.25 to 1.00:

(b)Interest Coverage Ratio.  Permit, as of the last day of any fiscal quarter, commencing with the fiscal quarter ending September 30, 2010, the Interest Charge Coverage Ratio to be less than 3.50 to 1.00.

6.2Limitation on Indebtedness

.  At any time incur, create, assume, or suffer to exist any Indebtedness except:

(a)amounts outstanding under the Loan Documents and Hedge Agreements with a Lender or an Affiliate thereof;

(b)purchase money Indebtedness on equipment purchased in the ordinary course of business and Capital Lease Obligations not exceeding, together with any purchase money Indebtedness or Capital Lease Obligations listed on Schedule 6.2, an aggregate principal amount at any time outstanding of $4,000,000;

(c)Indebtedness existing as of the date hereof described on Schedule 6.2 (including, except with respect to seller notes, any extensions or renewals or refinancings thereof provided there is no increase in the amount thereof or other significant change in the terms thereof);

(d)Indebtedness in an aggregate amount not to exceed $1,000,000 at any one time outstanding of a Person which becomes a Subsidiary after the Closing Date, provided that (i) such Indebtedness existed at the time such Person became a Subsidiary and was not created in anticipation of the acquisition, (ii) immediately after giving effect to the acquisition of such Person by the Parent or a Subsidiary, no Default or Event of Default shall have occurred and be continuing and (iii) the Borrower has complied with Section 5.15 hereof;

(e)earn-outs in connection with Permitted Acquisitions consummated after the date hereof (but not seller notes which, for any Permitted Acquisition consummated on or after the Closing Date, shall only be permitted to the extent that they constitute Subordinated Debt);

(f)unsecured Indebtedness of the Parent’s Subsidiaries in an aggregate principal amount not to exceed $500,000 at any time outstanding the proceeds of which are to be used for such Subsidiaries’ general corporate purposes;

(g)Subordinated Debt;

(h)subject to Section 6.6, Indebtedness owed to a Loan Party or any other Subsidiary by another Loan Party or any other Subsidiary;

(i)other Indebtedness in respect of letters of credit or bank guaranties issued for the account of Foreign Subsidiaries in an aggregate amount available to be drawn not to exceed $500,000 at any time outstanding;

(j)Guaranty Obligations incurred in the ordinary course of business by the Parent or any of its Subsidiaries of (i) obligations of any Loan Party or (ii) any Indebtedness of the Parent or any of its Subsidiaries permitted under this Section 6.2 (except (x) as regards Indebtedness under clause (c) above, only if and to the extent such Indebtedness was guaranteed on the Closing Date and (y) Subordinated Debt under clause (g) above); and

(k)Indebtedness relating to Hedge Agreements entered into for non-speculative purposes.

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6.3Limitation on Liens

Create, incur, assume or suffer to exist any Lien upon any of its property, assets or revenues, including, without limitation, the stock of any Subsidiary, whether now owned or hereafter acquired, except for (the following, collectively, “Permitted Liens”):

(a)Liens in favor of the Lenders or the Administrative Agent arising under the Loan Documents;

(b)The following, (i) if the validity or amount thereof is being contested in good faith by appropriate and lawful proceedings diligently conducted so long as levy and execution thereon have been stayed and continue to be stayed or (ii) if a final judgment is entered and such judgment is discharged within thirty (30) days of entry, and in either case they do not materially impair the ability of the Loan Parties to perform their obligations hereunder or under the other Loan Documents:

(A)Claims or Liens for taxes, assessments or charges due and payable and subject to interest or penalty, provided that the Loan Parties maintain such reserves or other appropriate provisions as shall be required by GAAP and pay all such taxes, assessments or charges forthwith upon the commencement of proceedings to foreclose any such Lien; and

(B)Claims or Liens upon, and defects of title to, real or personal property including any attachment of personal or real property or other legal process prior to adjudication of a dispute on the merits.

(c)liens for taxes not yet due or which are being contested in compliance with Section 5.3;

(d)carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like Liens arising in the ordinary course of business;

(e)pledges or deposits in connection with workers’ compensation, unemployment insurance and other social security or social welfare legislation;

(f)liens of landlords or of mortgagees of landlords arising by operation of law and deposits to secure the performance of leases in the ordinary course of business;

(g)deposits to secure the performance of bids, trade contracts (other than for borrowed money), leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature incurred in the ordinary course of business of the Loan Parties;

(h)easements, rights-of-way, restrictions and other similar encumbrances incurred in the ordinary course of business which, in the aggregate, are not substantial in amount and which do not interfere with the ordinary conduct of the business of the Loan Parties;

(i)Liens which were in existence on the date hereof and shown on Schedule 6.3 and extensions or replacements thereof;

(j)Liens on assets (other than inventory or receivables) of Persons which become Subsidiaries after the date of this Agreement, provided that such Liens existed at the time the respective corporations became a Subsidiary and were not created in anticipation thereof, provided that, (i) any such Lien does not by its terms cover any property or assets after the time such company becomes a Subsidiary which were not covered immediately prior thereto (ii) and the Borrower has complied with Section 5.15 hereof;

(k)Capital Leases and purchase money security interests as and to the extent permitted under this Agreement; and

(l)Liens securing reimbursement obligations under any letter of credit permitted by subsection 6.2(i), provided that such Liens attach solely to the assets of the Foreign Subsidiary to which such letter of credit relates;

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6.4Limitations on Fundamental Changes

Enter into any merger, consolidation or amalgamation, or liquidate, wind up or dissolve itself (or suffer any liquidation or dissolution), or convey, sell, lease, assign, transfer or otherwise dispose of, all or substantially all of its property, business or assets except:

(a)a Subsidiary of the Borrower may merge, consolidate or amalgamate into the Borrower so long as the Borrower is the surviving entity;

(b)a Subsidiary of the Parent may merge, consolidate or amalgamate into or with any Loan Party provided that the surviving entity is or becomes a Loan Party;

(c)a Non-Loan Party may merge, consolidate or amalgamate with or into any other Non-Loan Party;

(d)subject to Section 6.16, a Subsidiary of the Parent may sell, lease, transfer or otherwise dispose of any or all of its assets (upon voluntary liquidation or otherwise) to any other Loan Party;

(e)a Non-Loan Party may liquidate, wind up or dissolve itself or suffer any liquidation or dissolution;

(f)a Non-Loan Party may sell, lease, transfer or otherwise dispose of any or all of its assets (upon voluntary liquidation or otherwise) to any other Non-Loan Party;

(g)a merger permitted under Section 6.6; and

(h)the Merger; provided that, the Borrower complies with Section 5.15 and, after giving effect to the Merger, all Domestic Subsidiaries of the Parent are Loan Parties and their assets have been pledged to the Administrative Agent as security pursuant to a Security Agreement.

provided that, immediately after each such transaction and after giving effect thereto, the Borrower is in compliance with this Agreement and no Default or Event of Default shall be in existence or result from such transaction.

6.5Limitations on Sale of Assets

Convey, sell, lease, assign, transfer or otherwise dispose of any of its property, business or assets (including, without limitation, accounts receivables and leasehold interests), whether now owned or hereafter acquired, except:

(a)obsolete or worn out property disposed of in the ordinary course of business;

(b)the sale of inventory or other assets in the ordinary course of business;

(c)as permitted by Section 6.4;

(d)Permitted Liens;

(e)the abandonment of any patent, patent application, trademark, trademark application service mark or copyright that any Subsidiary of the Parent determines, in its commercial reasonable judgment, is no longer necessary or useful in any material respect in its business; and

(f)transfers of assets by any Loan Party to any Non-Loan Party, provided that such Loan Party receives cash consideration in an amount not less than the fair market value of such transferred assets.

This Section 6.5 shall not prohibit the Parent, the Borrower or any Subsidiary from purchasing, holding or acquiring any Investment that is a Permitted Investment.

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6.6Limitations on Acquisitions and other Investments

Purchase, hold or acquire beneficially any stock, other securities or evidences of indebtedness of, or make or permit any Investment (including in any other Person), except for Permitted Investments; provided that, no Permitted Acquisition (other than the Merger and the Tender Offer) shall be completed after the Closing Date unless prior to the 15th day before such completion (or, with respect to any Permitted Acquisition the Consideration for which is less than $10,000,000, within 30 days after such completion), the Borrower has provided to the Administrative Agent (a) audited, if available, and, if not, unaudited annual financial statements of the Person being acquired (or whose assets are being acquired) for the two (2) fiscal years (or such lesser period of such Person’s existence), (b) unaudited financial statements f or any interim fiscal period(s), prior to the consummation of such proposed acquisition, and (c) such additional independent third party due diligence reports and field audits and/or examinations, as the Required Lenders may request, all in form and substance satisfactory to the Required Lenders; provided that, the Borrower shall use good faith efforts to obtain three (3) years of financial statements of the Person being acquired (or whose assets are being acquired).

6.7Limitation on Distributions

At any time make (or incur any liability to make) or pay any Distribution (whether in cash or property or obligations of a Subsidiary of the Parent) in respect of the Parent or any Subsidiary thereof (other than a Distribution payable to a direct Subsidiary of the Parent or from a Subsidiary of a direct Subsidiary of the Parent to another Subsidiary of a direct Subsidiary of the Parent); except that, so long as no Default or Event of Default shall have occurred and be continuing, a direct Subsidiary of the Parent shall be permitted to pay dividends to the Parent, to pay professional fees, franchise and income taxes and other ordinary course of business operating expenses  incurred by the Parent solely in its capacity as parent corporation of the Borrower, any other direct Subsidiary of the Parent and the Subsidiaries thereof.

6.8Transactions with Affiliates

Except as expressly permitted in this Agreement, directly or indirectly enter into any transaction or arrangement whatsoever or make any payment to or otherwise deal with any Affiliate other than a Loan Party, except, as to all of the foregoing pursuant to the reasonable requirements of the Loan Parties’ businesses and upon fair and reasonable terms no less favorable to the Loan Parties than would be obtained in a comparable arm’s length transaction with a Person not an Affiliate.

6.9Sale and Leaseback

Enter into any arrangement with any Person providing for the leasing by any Subsidiary of the Parent of real or personal property which has been or is to be sold or transferred by any Subsidiary of the Parent to such Person or to any other Person to whom funds have been or are to be advanced by such Person on the security of such property or rental obligations of such Subsidiary.

6.10Continuation of or Change in Business

Engage in any business either directly or through any Subsidiary except for businesses in which Subsidiaries of the Parent are engaged in on the date of this Agreement and any business activities directly related to such existing businesses.

6.11Limitation on Negative Pledge

Enter into any agreement with any Person other than the Administrative Agent and the Lenders which prohibits or limits the ability of the Parent or its Subsidiaries to create, incur, assume or suffer to exist any Lien upon any of its or their properties, assets or revenues, whether now owned or hereafter acquired; provided, that, any Subsidiary of the Parent may enter into such agreement in connection with any Lien permitted by subsection 6.2(b) of this Agreement, when such prohibition or limitation is by its terms effective only against the assets subject to such Lien.

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6.12Limitation on Optional Prepayment of Indebtedness

Make any optional payment or prepayment or redemption, defeasance or purchase of any Subordinated Debt, earn-outs and any other Indebtedness evidenced by any seller notes; or amend, modify or change, or consent or agree to any amendment, modification or change to, any of the terms of any Subordinated Debt or any seller notes or earn-out arrangements (other than any amendment, modification or change of a nature which (a) would extend the maturity or reduce the amount of any payment of principal thereof, (b) would reduce the rate or extend the date for payment of interest thereon or (c) is not material and, in any event, will not involve accelerating the date or increasing the amount of any payment or prepayment.  Notwithstanding anything in this Section 6.12 to the contrary, any Subsidiary of the Parent shall be permitted to set off amounts owed by them under any seller note against indemnification obligations owed to them by the payee of such note in accordance with the terms thereof, and such setoff shall not be deemed an optional payment or prepayment or redemption, defeasance or purchase of any Indebtedness or earn-out payment under this Section 6.12.  Promptly following any such set-off, the Borrower shall provide the Administrative Agent with notice of such set-off setting forth in reasonable detail the amount of such set-off and the resulting principal amount then outstanding under such seller note after giving effect to such set-off.

6.13Use of Proceeds

Directly or indirectly apply any part of the proceeds of the Loans to the purchasing or carrying of any “margin stock” within the meaning of Regulation U of the Board of Governors of the Federal Reserve System, or any regulations, interpretations or rulings thereunder.

6.14Fiscal Year

Permit any fiscal year of the Parent to end on a day other than December 31.

6.15Clauses Restricting Subsidiary Distributions

Enter into or suffer to exist or become effective any (a) consensual encumbrance or restriction or (b) injunction or other order imposing a restriction, on the ability of any Subsidiary of the Borrower or any Subsidiary of any other direct Subsidiary of the Parent to (i) make Distributions in respect of any Capital Stock of such Subsidiary held by, or pay any Indebtedness owed to, the Borrower, any other direct Subsidiary of the Parent or any other Subsidiary of the Parent, (ii) make loans or advances to, or other Investments in, the Borrower, any other direct Subsidiary of the Parent or any other Subsidiary of the Parent or (iii) transfer any of its assets to the Borrower, any other direct Subsidiary of the Parent or any other Subsidiary of the Parent, except for any restrictions existing under the Loan Documents .

6.16Limitation on Activities of the Parent

Permit the Parent to (a) own any property other than Capital Stock of the Borrower, the Capital Stock of any other Subsidiary in connection with a Permitted Acquisition and property ancillary thereto, (b) engage in any business other than (i) business incidental to its ownership of Capital Stock of the Borrower and any other Subsidiary permitted hereunder, and (ii) to undertake Permitted Acquisitions and become party to relevant documentation in connection therewith, or (c) have any liabilities other than  liabilities incurred in the ordinary course of business and pursuant to Permitted Acquisitions.

6.17No Misrepresentations or Material Nondisclosure

Furnish the Administrative Agent or any Lender any certificate or other document that will contain any untrue statement of a material fact or that will omit to state a material fact necessary in order to make it not misleading in light of the circumstances under which it was furnished.

6.18Kenexa SA PTE Ltd. (South Africa)

Permit, at any time, Kenexa SA PTE Ltd. (South Africa) and its Subsidiaries to have assets with a fair market value, in the aggregate, in excess of $100,000.

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SECTION 7.  EVENTS OF DEFAULT

7.1Events of Default

Each of the following shall constitute an event of default (an “Event of Default”):

(a)The Borrower fails to pay on or before the date when due, whether on demand or otherwise, any principal of the Notes or any Reimbursement Obligation, or fails to pay within five (5) days after the date when due, any interest thereon or any other Indebtedness (including fees and expenses) to the Administrative Agent or the Lenders under this Agreement or the other Loan Documents.

(b)The Borrower fails to comply with or perform as and when required or to observe any of the terms, conditions or covenants contained in Sections 5.1, 5.7, 5.11, 5.15 or Section 6 of this Agreement.

(c)The Borrower or any Loan Party fails to comply with or perform as and when required any of the terms, covenants, or conditions of this Agreement or any other Loan Document (other than as provided in subsections (a) and (b) above) to be complied with, performed or observed by the Borrower or such Loan Party and such failure shall continue unremedied for a period of 30 days after the earlier of (i) notice thereof from the Administrative Agent or any Lender to the Borrower and (ii) any Responsible Officer of the Borrower becoming aware thereof.

(d)Any financial statement or any representation or warranty of the Borrower or any Loan Party made herein or in any other Loan Document or in any report, certificate or other document furnished under or in connection with this Agreement proves to have been false or misleading in any material respect on or as of the date made or deemed made.

(e)There occurs a default or event of default under (a) any of the other Loan Documents or any other document or instrument delivered to the Administrative Agent by the Borrower or any other Loan Party or (b) any Hedge Agreement entered into with a Lender or Affiliate thereof, and such default or event of default continues unremedied beyond the grace period, if any, provided therein.

(f)The Parent or any Subsidiary thereof shall (i) default in the payment of any principal of or interest on or any other amount payable on any Indebtedness beyond the period of grace (not to exceed 30 days), if any, provided in the instrument or agreement under which such Indebtedness was created and the aggregate amount of such Indebtedness in respect of which such default or defaults shall have occurred is at least $500,000; or (ii) default in the observance or performance of any other agreement or condition relating to any such Indebtedness in excess of $500,000 contained in any instrument or agreement evidencing, securing or relating thereto, or any other event shall occur or condition exist, the effect of which defau lt or other event or condition is to cause, or to permit the holder or holders of such Indebtedness (or a trustee or agent on behalf of such holder or holders) to cause, with the giving of notice if required, such Indebtedness to become due and payable prior to its stated maturity.

(g)(i) The Parent or any Subsidiary thereof makes an assignment for the benefit of its creditors or a composition with its creditors, or is unable or admits in writing its inability to pay its debts as they mature, or files a petition in bankruptcy, or commences a federal bankruptcy proceeding in which an order for relief or such other court order or statutory provision which authorizes the case to proceed is entered against it, or is adjudicated insolvent or bankrupt, or petitions or applies to any tribunal for the appointment of any custodian, receiver, liquidator or trustee of or for it or any substantial part of its properties or assets, or commences any proceeding relating to it under any bankruptcy, reorganization, arran gement, readjustment of debt, receivership, dissolution or liquidation law or statute of any jurisdiction, whether now or hereafter in effect; or there is commenced against the Parent or any Subsidiary thereof any such proceeding which shall remain undismissed for a period of 60 days, or an order for relief, order, judgment or decree approving the petition in any such proceeding is entered; or (ii) the Parent or any Subsidiary thereof by any act or failure to act indicates its consent to, approval of or acquiescence in any such proceeding or in the appointment of any custodian, receiver, liquidator or trustee of or for it or any substantial part of its properties or assets, or suffers any such appointment to continue undischarged or unstayed for a period of 60 days; or (iii) the Parent or any Subsidiary thereof takes any action for the purpose of effecting any of the foregoing.

(h)One or more judgments or decrees shall be entered against the Parent or any Subsidiary thereof involving in the aggregate a liability (to the extent not covered by insurance as to which the insurer does not dispute coverage thereof) of $500,000or more and all such judgments or decrees shall not have been vacated, discharged, settled, satisfied or paid, or stayed or bonded pending appeal, within 30 days from the entry thereof.

(i)Any of the Loan Documents shall cease to be legal, valid and binding agreements enforceable against a Loan Party executing the same in accordance with the respective terms thereof or shall in any way be terminated (except in accordance with its terms) or become or be declared ineffective or inoperative or shall in any way be challenged and thereby deprive or deny the Lenders and the Administrative Agent of the intended benefits thereof or they shall thereby cease substantially to have the rights, titles, interests, remedies, powers or privileges intended to be created thereby.

(j)Any attachment or execution process is issued against 10% or more of the assets of the Parent or any Subsidiary thereof; or any material uninsured damage to, or loss, theft or destruction of, any of the collateral subject to the Security Documents occurs which would reasonably be expected to result in a Material Adverse Effect.

(k)The suspension by the Parent or any other Loan Party of all or any significant part of its business operations or the loss, suspension, revocation or failure of the Parent or any other Loan Party to renew any license or permit now held or hereafter acquired by the Parent or any other Loan Party, which loss, suspension, revocation or failure to file would reasonably be expected to have a Material Adverse Effect.

(l)(A) (i) Any Employee Pension Plan is terminated within the meaning of Title IV of ERISA, or (ii) a trustee is appointed by the appropriate United States District Court to administer any Employee Pension Plan, or (iii) PBGC institutes proceedings to terminate any Employee Pension Plan or to appoint a trustee to administer any Employee Pension Plan, or (iv) any Reportable Event occurs which the Required Lenders determine in good faith indicates a substantial likelihood that an event described in (i), (ii) or (iii) above will occur, or (v) the Parent or any of its Affiliates incurs any Withdrawal Liability with respect to any Multiemployer Plan, or (vi) any Multiemployer Plan enters Reorganization , and (B) with respect to events described in (i)-(iv) above, only if, (1) the benefit liabilities (within the meaning of Section 4001(a)(16) of ERISA) exceed the market value of the assets in the fund under the Employee Pension Plan by 5% or more of the Parent’s or its Affiliate’s tangible net worth or (2) the Adjusted Funding Target Attainment Percentage for the Employee Pension Plan is less than 80% or (3) there occurs an Accumulated Funding Deficiency or Unpaid Minimum Required Contribution in excess of $250,000 with respect to any Employee Pension Plan or (4) there occurs any Accumulated Funding Deficiency or Unpaid Minimum Required Contribution with respect to any Employee Pension Plan and the Parent or any of its Affiliates fails to correct such Accumulated Funding Deficiency or Unpaid Minimum Required Contribution prior to the end of the correction period within the meaning of Section 4971(c) of the Code, or (5) there arises a Lien under Section 303(k) of ERI SA or 430(k) of the Code in favor of any Employee Pension Plan.

(m)Any Change of Control shall occur.

(n)There is a Material Adverse Effect.

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7.2Remedies

If an Event of Default specified in subsection 7.1(g) with respect to the Borrower shall occur and be continuing, the Revolving Credit Commitments (including the obligation of the Issuing Bank to issue Letters of Credit) shall automatically and immediately terminate, and the Loans hereunder (with accrued interest thereon) and all other amounts owing under this Agreement, the Notes and the other Loan Documents shall automatically and immediately become due and payable (including, without limitation, all Letter of Credit Obligations, whether or not the beneficiaries of the then outstanding Letters of Credit shall have presented the documents required thereunder).  If any other Event of Default shall occur and be continuing, with the consent of the Required Lenders, the Administrative Agent may, or upon the written request of the R equired Lenders, the Administrative Agent shall (a) by notice to the Borrower declare the Revolving Credit Commitments to be terminated forthwith, whereupon such Revolving Credit Commitments and the obligations of the applicable Lenders to make Revolving Credit Loans and the obligation of the Issuing Bank to issue Letters of Credit, shall immediately terminate; (b) by notice of default to the Borrower, declare the Loans hereunder (with accrued interest thereon) and all other amounts owing under this Agreement, the Notes and the other Loan Documents to be due and payable forthwith, whereupon the same shall immediately become due and payable (including, without limitation, all Letter of Credit Obligations, whether or not the beneficiaries of the then outstanding Letters of Credit shall have presented the documents required thereunder); (c) exercise such remedies as may be available to the Administrative Agent and the Lenders hereunder or under the Security Documents, the other Loan Documents or otherwise at la w or equity; and/or (d) by notice to the Borrower require the Borrower to, and the Borrower shall thereupon, deposit in a non-interest bearing account with the Administrative Agent, as cash collateral for its obligations under this Agreement, the Notes and the Applications, an amount equal to the aggregate Letter of Credit Coverage Requirement, and the Borrower hereby pledges to the Administrative Agent and the Lenders, and grants to the Administrative Agent and the Lenders a security interest in, all such cash as security for such obligations.  Amounts held in such cash collateral account shall be applied by the Administrative Agent to the payment of drafts drawn under the Letters of Credit or, with the consent of the Issuing Bank, to other Obligations, and the unused portion thereof after all the Letters of Credit shall have expired or been fully drawn upon, if any, shall be applied to repay the other Obligations.  After all the Letters of Credit shall have expired or been fully drawn u pon, all Reimbursement Obligations shall have been satisfied and all other Obligations shall have been paid in full, the balance, if any, in such cash collateral account shall be returned to the Borrower (or such other Person or Persons as may be lawfully entitled thereto).  The Borrower shall execute and deliver to the Administrative Agent, for the account of the Issuing Bank and the Letter of Credit Participants, such further documents and instruments as the Administrative Agent may request to evidence the creation and perfection of the within security interest in such cash collateral account.  Except as expressly provided above in this Section, presentment, demand, protest and all other notices of any kind are hereby expressly waived.

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SECTION 8.  HE ADMINISTRATIVE AGENT

8.1Appointment

Each Lender hereby irrevocably designates and appoints PNC as administrative agent of such Lender, in each case under this Agreement and the other Loan Documents, and each such Lender irrevocably authorizes PNC, in such capacity to take such action on its behalf under the provisions of this Agreement and the other Loan Documents and to exercise such powers and perform such duties as are expressly delegated to the Administrative Agent by the terms of this Agreement and the other Loan Documents, together with such other powers as are reasonably incidental thereto.  Notwithstanding any provision to the contrary elsewhere in this Agreement and the other Loan Documents, the Administrative Agent shall not have any duties or responsibilities, except those expressly set forth herein or therein, or any fiduciary relationship with any Len der, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement and the other Loan Documents or otherwise exist against the Administrative Agent.  PNC agrees to act as the Administrative Agent on behalf of the Lenders to the extent provided in this Agreement and the other Loan Documents.

8.2Delegation of Duties

The Administrative Agent may execute any of its duties under this Agreement and the other Loan Documents by or through agents or attorneys-in-fact and shall be entitled to engage and pay for the advice and services of counsel concerning all matters pertaining to such duties.  The Administrative Agent shall not be responsible to the Lenders for the negligence or misconduct of any agents or attorneys-in-fact selected by it with reasonable care.

8.3Exculpatory Provisions

The Lenders hereby agree that neither the Administrative Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or Affiliates shall be (a) liable for any action lawfully taken or omitted to be taken by it or such Person under or in connection with this Agreement or the other Loan Documents (except for its or such Person’s own gross negligence or willful misconduct) or (b) responsible in any manner to any of the Lenders for any recitals, statements, representations or warranties made by the Borrower, any other party or any officer thereof contained in this Agreement, the other Loan Documents or in any certificate, report, statement or other document referred to or provided for in, or received by the Administrative Agent under or in connection with, this Agreement or the other Loan Documents or for th e value, validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement, the Notes or the other Loan Documents or for any failure of the Borrower or any other party to perform its or their obligations hereunder or thereunder.  The Administrative Agent shall not be under any obligation to any Lender to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, this Agreement or the other Loan Documents, or to inspect the properties, books or records of the other parties to the Loan Documents (or any of them).

8.4Reliance by Administrative Agent

The Administrative Agent shall be entitled to rely, and shall be fully protected in relying, upon any Note, writing, resolution, notice, consent, certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype message, statement, order or other document or conversation believed by it to be genuine and correct and to have been signed, sent or made by the proper Person or Persons and upon advice and statements of legal counsel (including, without limitation, counsel to the Borrower or any other party to a Loan Document), independent accountants and experts selected by the Administrative Agent.  The Administrative Agent may deem and treat the payee of any Note as the owner thereof for all purposes unless a written notice of assignment, negotiation or transfer thereof shall have been filed with the Administrative Ag ent.  The Administrative Agent shall be fully justified in failing or refusing to take any action under this Agreement or the other Loan Documents unless it shall first receive such advice or concurrence of the Required Lenders (or such other percentage of the Lenders as shall be required hereunder) as it deems appropriate and it shall first be indemnified to its satisfaction by the Lenders against any and all liability and expense which may be incurred by it by reason of taking or continuing to take any such action.  The Lenders hereby agree that the Administrative Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement, the Notes or the other Loan Documents in accordance with a request of the Required Lenders (or such other percentage of Lenders as shall be required hereunder), and such request and any action taken or failure to act pursuant thereto shall be binding upon all the Lenders and all future holders of the Notes.

8.5Notice of Default

The Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of any Default or Event of Default hereunder unless it has received notice from a Lender, the Borrower or any other Loan Party referring to this Agreement, describing such Default or Event of Default and stating that such notice is a “notice of default”.  In the event that the Administrative Agent receives such a notice, the Administrative Agent shall promptly give notice thereof to the Lenders.  The Administrative Agent shall take such action with respect to such Default or Event of Default as shall be reasonably directed by the Required Lenders (or such other percentage of the Lenders as shall be required hereunder); provided that unless and until the Administrative Agent shall have received such directions, the Adm inistrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of Default as it shall deem advisable in the best interests of the Lenders.

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8.6Non-Reliance on Administrative Agent and Other Lenders

Each Lender expressly acknowledges that neither the Administrative Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or Affiliates has made any representations or warranties to it and that no act by the Administrative Agent hereinafter taken, including any review of the affairs of the Borrower and/or any other party to the Loan Documents, shall be deemed to constitute any representation or warranty by the Administrative Agent to any Lender.  Each Lender represents to the Administrative Agent that it has, independently and without reliance upon the Administrative Agent or any other Lender, and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, operations, property, financial and other condition and creditworthiness of th e Borrower and the other parties to the Loan Documents and made its own decision to make its Loans hereunder, issue and/or participate in Letters of Credit and enter into this Agreement and each other Loan Document to which it is a party.  Each Lender also represents that it will, independently and without reliance upon the Administrative Agent or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not taking action under this Agreement and the other Loan Documents, and to make such investigation as it deems necessary to inform itself as to the business, operations, property, financial and other condition and creditworthiness of the Borrower and the other Loan Parties.  Except for notices, reports and other documents expressly required to be furnished to the Lenders by the Administrative Agent hereunder, the Administrative Agent shall not have any duty or res ponsibility to provide any Lender with any credit or other information concerning the business, operations, property, condition (financial or otherwise), prospects or creditworthiness of the Borrower or any other party to the Loan Documents which may come into the possession of the Administrative Agent or its officers, directors, employees, agents, attorneys-in-fact or Affiliates.

8.7Indemnification

The Lenders agree to indemnify the Administrative Agent in its agent capacity hereunder and under the other Loan Documents (to the extent not reimbursed by the Borrower and without limiting the obligation, if any, of the Borrower to do so) ratably in accordance with each Lender’s respective Revolving Credit Commitment Percentage, from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever which may at any time (including, without limitation, at any time following the payment of the Notes) be imposed on, incurred by or asserted against the Administrative Agent in any way relating to or arising out of this Agreement, the other Loan Documents, or any documents contemplated by or referred to herein or therein or the transactions con templated hereby or thereby or any action taken or omitted by the Administrative Agent under or in connection with any of the foregoing; provided that no Lender shall be liable for the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting solely from the Administrative Agent’s gross negligence or willful misconduct.  The agreements in this Section 8.7 shall survive the payment of the Notes and all other amounts payable hereunder.

8.8Administrative Agent in Its Individual Capacity

The Administrative Agent and its Affiliates may make loans to, accept deposits from and generally engage in any kind of business with the Borrower or any other party to the Loan Documents as though the Administrative Agent were not an agent hereunder.  With respect to its Loans made or renewed by it and any Notes issued to it, the Administrative Agent shall have the same rights and powers under this Agreement and the other Loan Documents as any Lender and may exercise the same as though it were not the administrative agent hereunder and under the other Loan Documents, and the terms “Lender” and “Lenders” shall include the Administrative Agent in its individual capacity.

8.9Release of Liens

Upon the sale or other transfer of any assets of the Borrower or any other Loan Party in compliance with Section 6.5, and so long as it is not aware that any Default or Event of Default shall exist, the Administrative Agent will take such action as may be necessary to evidence the release of the Administrative Agent’s Lien on such assets, including delivering to the Borrower or such other Loan Party, at the cost of the Borrower, appropriate collateral releases.

8.10Successor Administrative Agent

The Administrative Agent may resign as administrative agent hereunder and under the other Loan Documents upon 30 days’ notice to the Lenders and the Borrower.  If the Administrative Agent shall resign, then the Required Lenders shall appoint from among the Lenders a successor administrative agent for the Lenders, which appointment shall be subject to (unless a Default or Event of Default shall exist) the approval of the Borrower (which approval shall not be unreasonably withheld or delayed) and the appointee, whereupon such successor administrative agent shall succeed to the rights, powers and duties of the Administrative Agent and the term “Administrative Agent” shall mean such successor administrative agent effective upon its appointment and the former Administrative Agent’s rights, powers and duties sh all be terminated, without any other or further act or deed on the part of such former Administrative Agent or any of the other parties to this Agreement or the other Loan Documents or any holders of the Notes.  After any retiring Administrative Agent’s resignation, the provisions of this Article 8 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was an Administrative Agent under this Agreement and the other Loan Documents.

8.11USA Patriot Act

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

8.12Beneficiaries

Except as expressly provided herein, the provisions of this Section 8 are solely for the benefit of the Administrative Agent and the Lenders, and the Borrower and the other Loan Parties shall not have any right to rely on or enforce any of the provisions hereof.  In performing its functions and duties under this Agreement and the other Loan Documents, the Administrative Agent shall act solely as administrative agent of the Lenders and does not assume and shall not be deemed to have assumed any obligation toward or relationship of agency or trust with or for the Borrower or any of the other Loan Parties.

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SECTION 9.  MISCELLANEOUS

9.1Amendments and Waivers

                                                 (a)Subject to the remaining provisions of this Section 9.1, the Required Lenders, or the Administrative Agent with the consent of the Required Lenders, and the Borrower (or, in the case of the other Loan Documents, the relevant parties thereto) may from time to time enter into amendments, extensions, supplements and replacements to and of this Agreement and the other Loan Documents to which they are par ties, and the Required Lenders may from time to time waive compliance with a provision of any of the Loan Documents.  Subject to the remaining provisions of this Section 9.1, no amendment, extension, supplement, replacement or waiver shall be effective unless it is in writing and is signed by the Required Lenders or the Administrative Agent with the consent of the Required Lenders, and the Borrower (or, in the case of the other Loan Documents, the relevant parties thereto).  Each waiver shall be effective only for the specific instance and for the specific purpose for which it is given.

(b)The foregoing notwithstanding, no such amendment, extension, supplement, replacement or waiver shall, directly or indirectly, without the consent of all the Lenders:

(i)change the Revolving Credit Commitments (except as expressly provided in Section 2.9) or the principal amount of the Loans which may be outstanding hereunder;

(ii)reduce any interest rate hereunder (other than to waive the Default Rate) or any of the fees due hereunder or under any of the other Loan Documents (other than fees to the Administrative Agent, which shall require the consent of the Borrower and the Administrative Agent to change);

(iii)postpone any scheduled payment date of principal, interest or fees hereunder or under any of the other Loan Documents (excluding mandatory principal prepayment of the Loans);

(iv)release all or substantially all of the Lenders’ security interest in the Collateral securing the Obligations;

(v)change the definition of “Required Lenders”;

(vi)release or discharge, or consent to any release or discharge of (A) the Borrower as borrower under the Loan Documents or (B) a Guarantor as guarantor (other than in connection with a sale of such Guarantor in a transaction permitted hereunder); or permit the Borrower or any Affiliate to assign to another Person any of its obligations under the Loan Documents;

(vii)amend this Section 9.1; or

(viii)change Section 2.15 in a manner that would alter the pro rata sharing provisions required thereby.

(c)The foregoing notwithstanding, no such amendment, extension, supplement, or replacement shall amend, modify or otherwise affect the rights or duties of the Administrative Agent or the Issuing Bank hereunder or under any other Loan Document without the prior written consent of the Administrative Agent or the Issuing Bank, as the case may be.

(d)Any waiver or amendment, supplement or modification permitted hereunder shall apply equally to each of the Lenders and shall be binding upon the Borrower, the Lenders, the Administrative Agent and all future holders of the Notes.  In the case of any waiver, the Borrower, the Lenders and the Administrative Agent shall be restored to their former position and rights hereunder and under the other Loan Documents, and any Default or Event of Default waived shall be deemed to be cured and not continuing; but no such waiver shall extend to any subsequent or other Default or Event of Default, or impair any right consequent thereon.

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9.2Notices

All notices, requests and demands to or upon the respective parties hereto to be effective shall be in writing (including by electronic transmission, telecopy transmission or posting on a secured web site), and, unless otherwise expressly provided herein, shall be deemed to have been duly given or made when delivered by hand, or three days after being deposited in the mail, postage prepaid, or the next Business Day if sent by reputable overnight courier, postage prepaid, for delivery on the next Business Day, or, in the case of telecopy notice, when received during normal business hours, or in the case of electronic transmission, when received and in the case of posting on a secured web site, upon receipt of (i) notice of such posting and (ii) rights to access such web site, addressed as follows in the case of the Borrower, the Administrative Agent and the Issuing Bank, and as set forth in Schedule I or in its Assignment and Assumption in the case of the other parties hereto, or to such other address as may be hereafter notified by the respective parties hereto and any future holders of the Notes:

If to the Borrower:	Kenexa Technology, Inc. 650 East Swedesford Road Wayne, PA  19087 Attention:  Don Volk, Chief Financial Officer Telecopy:  (610) 971-2576 and Attention:  Cynthia Pyle Dixon, Esq. Telecopy:  (610) 971-2576
	with a copy to:
	Pepper Hamilton LLP 3000 Logan Square 18th and Arch Streets Philadelphia, PA  19103 Attention:  Barry M. Abelson, Esq. Telecopy:  (215) 981-4750

provided that failure to send a copy of such notice to Pepper Hamilton LLP shall in no way affect, limit or invalidate any notice sent to the Borrower or the exercise of any of the Administrative Agent’s or the Lenders’ rights or remedies pursuant to a notice sent to the Borrower;

If to the Administrative Agent or the Issuing Bank:	PNC Bank, National Association 1000 Westlakes Drive, Suite 200 Berwyn, PA  19312 Attention:  Daniel C. Takoushian Telecopy:  (610) 725-5799
	and
	PNC Bank, National Association Agency Services PNC Firstside Center 500 First Avenue, 4th Floor Pittsburgh, PA  15219 Attention:  Lisa Pierce Telecopy:  (412) 762-8672

provided (a) any notice, request or demand to or upon the Administrative Agent, the Issuing Bank or the Lenders pursuant to Sections 2.3, 2.4, 2.9 and 2.10 shall not be effective until received and (b) any notice of a Default or Event of Default hereunder shall be sent by telecopy or reputable overnight courier.

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9.3No Waiver; Cumulative Remedies

No failure to exercise and no delay in exercising, on the part of the Administrative Agent, the Issuing Bank or any Lender, any right, remedy, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.  The rights, remedies, powers and privileges herein provided are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law.

9.4Survival of Representations and Warranties

All representations and warranties made hereunder and in any document, certificate or statement delivered pursuant hereto or in connection herewith shall survive the execution and delivery of this Agreement, the Notes and the other Loan Documents.

9.5Payment of Expenses and Taxes

The Borrower agrees (a) to pay or reimburse the Administrative Agent for all of its reasonable out-of-pocket costs and expenses incurred in connection with the development, preparation and execution of, and the syndication and administration of, this Agreement, the Notes, the other Loan Documents and any other documents executed and delivered in connection herewith or therewith, and the consummation of the transactions contemplated hereby and thereby, including, without limitation, the reasonable fees and disbursements of counsel, (b) to pay or reimburse the Administrative Agent for all of its reasonable out-of-pocket costs and expenses incurred in connection with the performance of or any amendment, supplement or modification or proposed amendment, supplement or modification to this Agreement, the Notes and the other Loan Documents and a ny other documents executed and delivered in connection therewith, including without limitation, the reasonable fees and disbursements of counsel, (c) pay or reimburse each Lender and the Administrative Agent for all its reasonable costs and expenses incurred in connection with the enforcement or preservation of any rights under this Agreement, the Notes, the other Loan Documents and any such other documents, including, without limitation, reasonable fees and disbursements of counsel, (d) to pay, indemnify, and hold each Lender and the Administrative Agent harmless from, any and all recording and filing fees and any and all liabilities with respect to, or resulting from any delay in paying, stamp, excise and other similar taxes, if any, which may be payable or determined to be payable in connection with the execution and delivery of, or consummation of any of the transactions contemplated by, or any amendment, supplement or modification of, or any waiver or consent under or in respect of, this Agreement , the Notes, the other Loan Documents and any such other documents, and (e) to pay, indemnify, and hold each Lender, the Administrative Agent and each of their respective Affiliates and the officers, directors, employees, agents and advisors of such Persons and such Affiliates (the “Indemnified Parties”) harmless from and against any and all other liabilities, obligations, losses, damages, penalties, actions (whether sounding in contract, in tort or on any other ground), judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever with respect to the execution, delivery, enforcement, performance and administration of or in any other way arising out of or relating to, this Agreement, the Notes, the other Loan Documents, or any such other documents contemplated by or referred to herein or therein or any action taken by any Lender or the Administrative Agent with respect to the foregoing (all the foregoing, collectively, the “indemnified liabilities”), provided, that the Borrower shall have no obligation hereunder to any Indemnified Party with respect to indemnified liabilities arising from the gross negligence or willful misconduct of such Indemnified Party.  The agreements in this subsection shall survive repayment of the Notes and all other amounts payable hereunder.

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9.6Successors and Assigns

(a)Whenever in this Agreement any of the parties hereto is referred to, such reference shall be deemed to include the successors and permitted assigns of such party; and all covenants, promises and agreements by or on behalf of the Borrower, the Administrative Agent or the Lenders that are contained in this Agreement shall bind and inure to the benefit of its respective successors and assigns.  The Borrower may not assign or transfer any of its rights or obligations under this Agreement or the other Loan Documents without the prior written consent of each Lender.

(b)Each Lender may, in accordance with applicable law, sell to any Lender or Affiliate thereof and, with the consent of the Borrower (except when any Event of Default exists or if the sale is to a Lender or an Affiliate of a Lender) and the Administrative Agent (which consents shall not be unreasonably withheld or delayed, and provided that the Borrower shall be deemed to have consented if it does not object to the assignment within five (5) Business Days after having received notice thereof), to one or more other banks or financial institutions (each, a “Purchasing Lender”) all or a part of its interests, rights and obligations under this Agreement, the N otes and the other Loan Documents (including all or a portion of its Revolving Credit Commitment and the Loans at the time owing to it and the Notes held by it); provided, however, that (i) so long as no Event of Default shall exist and be continuing, such assignment shall be in an amount not less than $1,000,000 (or such lesser amount as the Borrower (unless an Event of Default shall exist) and the Administrative Agent shall agree in their sole discretion), unless the sum of such assigning Lender’s Revolving Credit Exposure plus Unused Revolving Credit Commitment is less than $1,000,000 in which case such assigning Lender may transfer all, but not less than all, of its interests hereunder and (ii) the parties to each such assignment shall execute and deliver to the Administrative Agent and the Borrower for its acceptance (to the extent required) and recording in the Registe r an Assignment and Assumption, together with the Notes subject to such assignment and, except for assignments by a Lender to one of its Affiliates, a processing and recordation fee of $3,500.  Upon acceptance and recording pursuant to paragraph (e) of this Section 9.6, from and after the effective date specified in the applicable Assignment and Assumption, which effective date shall be at least five Business Days after the receipt thereof by the Administrative Agent and the Borrower (unless otherwise agreed by the Administrative Agent), (A) such Purchasing Lender shall be a party hereto and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement and (B) the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all or the remaining portion of an assig ning Lender’s rights and obligations under this Agreement and the other Loan Documents, such Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of subsections 2.12, 2.13, 2.14, 5.14(c) and 9.5 (to the extent that such Lender’s entitlement to such benefits arose out of such Lender’s position as a Lender prior to the applicable assignment).  Such Assignment and Assumption shall be deemed to amend this Agreement to the extent, and only to the extent, necessary to reflect the addition of such Purchasing Lender and the resulting amounts and percentages held by the Lenders arising from the purchase by such Purchasing Lender of all or a pro rata portion of the rights and obligations of such assigning Lender under this Agreement, the Notes and the other Loan Documents.

(c)By executing and delivering an Assignment and Assumption, the assigning Lender thereunder and the Purchasing Lender thereunder shall be deemed to confirm to and agree with each other and the other parties hereto as follows:  (i) such assigning Lender warrants that it is the legal and beneficial owner of the interest being assigned thereby, free and clear of any adverse claim and that its commitment, and the outstanding balances of its Loans, without giving effect to assignments thereof which have not become effective, are as set forth in such Assignment and Assumption, (ii) except as set forth in (i) above, such assigning Lender makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with this Agreement or the other Loan Documents, or the execution, legality, validity, enforceability, genuineness, sufficiency or value of this Agreement, the other Loan Documents or any other instrument or document furnished pursuant hereto or thereto, or the financial condition of the Borrower, the Parent, any other party, or any Subsidiary thereof or the performance or observance by the Borrower, any other Loan Party or any other party of any of its obligations under this Agreement or the other Loan Documents or any other instrument or document furnished pursuant hereto or thereto; (iii) such Purchasing Lender represents and warrants that it is legally authorized to enter into such Assignment and Assumption; (iv) such Purchasing Lender confirms that it has received a copy of this Agreement, together with copies of the most recent financial statements delivered pursuant to Section 5.1 and such other documents and information as it has deem ed appropriate to make its own credit analysis and decision to enter into such Assignment and Assumption; (v) such Purchasing Lender will independently and without reliance upon the Administrative Agent, such assigning Lender or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under this Agreement and the other Loan Documents; (vi) such Purchasing Lender appoints and authorizes the Administrative Agent to take such action as administrative agent on its behalf and to exercise such powers under this Agreement and the other Loan Documents as are delegated to the Administrative Agent by the terms hereof or thereof, together with such powers as are reasonably incidental thereto; and (vii) such Purchasing Lender agrees that it will perform in accordance with their terms all the obligations which by the terms of this Agreement and the other Loan Documents are required to be performed by it as a Lender including, if it is organized under the laws of a jurisdiction outside the United States, its obligation pursuant to Section 2.13 to deliver the forms prescribed by the Internal Revenue Service of the United States certifying as to the Purchasing Lender’s exemption from United States withholding taxes with respect to all payments to be made to the Purchasing Lender under this Agreement.

(d)The Administrative Agent shall maintain at its offices a copy of each Assignment and Assumption and the names and addresses of the Lenders, and the commitments of, and principal amount of the Loans owing to, each Lender pursuant to the terms hereof from time to time (the “Register”).  The entries in the Register shall be conclusive in the absence of manifest error and the Borrower, the Administrative Agent and the Lenders may treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement.  The Register shall be available for inspection by the Borrower and any Lender at any reasonable time and from time to time upon reasonable prior notice.

(e)Upon its receipt of a duly completed Assignment and Assumption executed by an assigning Lender and a Purchasing Lender (and in the case of a Purchasing Lender that is not then a Lender or an Affiliate thereof, by the Borrower (unless an Event of Default shall then exist) and the Administrative Agent) together with the Note or Notes subject to such assignment and the processing and recordation fee referred to in paragraph (b) above, the Administrative Agent shall promptly (i) accept such Assignment and Assumption, (ii) record the information contained therein in the Register and (iii) give notice thereof to the Lenders.  Within five Business Days after receipt of notice, the Borrower, at its own expense, shall execute and deliver to the Administrative Agent, in exchange for the surrender of the original Revolving Credit Note or Revolving Credit Notes (A) a new Revolving Credit Note, to the order of such Purchasing Lender in the appropriate amounts assumed and (B) if the assigning Lender has retained an interest hereunder, the applicable Note or Notes in the appropriate amount(s).  Such new Note(s) shall be dated the date of the surrendered Note(s) which such new Note(s) replace and shall otherwise be in substantially the form of Exhibit A-1.  Canceled Notes shall be returned to the Borrower.

(f)Each Lender may, in accordance with applicable law,  sell participations to any Lender or Affiliate thereof and to one or more banks or other Persons (each a “Participant”), in each case in any Loan owing to such Lender, any Note held by such Lender, any commitment of such Lender, or any other interest of such Lender hereunder and under the other Loan Documents, provided, however, that (i) such Lender’s obligations under this Agreement to the other parties to this Agreement shall remain unchanged, (ii)
60;such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations, (iii) such Lender shall remain the holder of any such Note for all purposes under this Agreement and the other Loan Documents, (iv) the Borrower, the Lenders and the Administrative Agent shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement and the other Loan Documents, (v) in any proceeding under the Bankruptcy Code, such Lender shall be, to the extent permitted by law, the sole representative with respect to the obligations held in the name of such Lender, whether for its own account or for the account of any Participant and (vi) such Lender shall retain the sole right to approve, without the consent of any Participant, any amendment, modification or waiver of any provision of this Agreement or the Notes held by such Lender or any other Loan Document, other than with respect to the mat ters described in clauses (i) through (viii) of subsection 9.1(b).

(g)If amounts outstanding under this Agreement and the Notes are due or unpaid, or shall have been declared or shall have become due and payable upon the occurrence of an Event of Default, each Participant shall be deemed to have the right of set-off in respect of its participating interest in amounts owing under this Agreement and any Note to the same extent as if the amount of its participating interest were owing directly to it as a Lender under this Agreement or any Note, provided that in purchasing such participation such Participant shall be deemed to have agreed to share with the Lenders the proceeds thereof as provided in Section 9.7  The Borrower al so agrees that each Participant shall be entitled to the benefits of subsections 2.12, 2.13, 2.14, 5.14(c) and 9.5 with respect to its participation in the commitments and the Loans outstanding from time to time; provided, that no Participant shall be entitled to receive any greater amount pursuant to such subsections than the assigning Lender would have been entitled to receive in respect of the amount of the participation transferred by such assigning Lender to such Participant had no such transfer occurred.

(h)If any Participant of a Lender is organized under the laws of any jurisdiction other than the United States or any state thereof, the assigning Lender, concurrently with the sale of a participating interest to such Participant, shall cause such Participant (i) to represent to the assigning Lender (for the benefit of the assigning Lender and the other Lenders), the Administrative Agent and the Borrower that under applicable law and treaties no taxes will be required to be withheld by the Administrative Agent, the Borrower or the assigning Lender with respect to any payments to be made to such Participant in respect of its participation in the Loans and Letters of Credit and (ii) to agree (for the benefit of the assignin g Lender, the other Lenders, the Administrative Agent and the Borrower) that it will deliver the tax forms and other documents required to be delivered pursuant to subsection 2.13(b) and comply from time to time with all applicable U.S. laws and regulations with respect to withholding tax exemptions.

(i)Notwithstanding any other provision contained in this Agreement or any other Loan Document to the contrary, any Lender may, without obtaining any consents from any of the parties hereto, at any time (i) assign all or any portion of the Loans or Notes held by it to any Federal Reserve Bank or the United States Treasury as collateral security pursuant to Regulation A of the Board of Governors of the Federal Reserve System and any Operating Circular issued by such Federal Reserve Bank and (ii) in the case of a Lender that is or owns, controls or serves as originator for a fund, trust or similar entity, assign or pledge all or any portion of the Loans or Notes held by it to a trustee under any indenture to which such Lende r is a party or to the lenders to such Lender for collateral security purposes, provided that any payment in respect of such assigned Loans or Notes made by the Borrower to or for the account of the assigning or pledging Lender in accordance with the terms of this Agreement shall satisfy the Borrower’s obligations hereunder in respect to such assigned Loans or Notes to the extent of such payment.  No such assignment shall release the assigning Lender from its obligations hereunder.

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9.7Adjustments; Set-off

                                                (a)  Except as otherwise expressly provided herein, if any Lender (a “benefited Lender”) shall at any time receive any payment of all or part of its Loans or the Reimbursement Obligations owing to it, or interest thereon, or receive any collateral in respect thereof (whether voluntarily or involuntarily, by set-off, pursuant to events or proceedings of the nature referred to in subsection 7.1(g), or otherwise), in a greater proportion than any such payment to or collater al received by any other Lender, if any, in respect of such other Lender’s Loans or the Reimbursement Obligations owing to it, or interest thereon, such benefited Lender shall purchase for cash from the other Lenders such portion of each such other Lender’s Loans or the Reimbursement Obligations owing to it, or shall provide such other Lenders with the benefits of any such collateral, or the proceeds thereof, as shall be necessary to cause such benefited Lender to share the excess payment or benefits of such collateral or proceeds ratably with each of the Lenders; provided, however, that if all or any portion of such excess payment or benefits is thereafter recovered from such benefited Lender, such purchase shall be rescinded, and the purchase price and benefits returned, to the extent of such recovery, but without interest.  The Borrower agrees that each Le nder so purchasing a portion of another Lender’s Loans may exercise all rights of payment (including, without limitation, rights of set-off) with respect to such portion as fully as if such Lender were the direct holder of such portion.

(b)In addition to any rights and remedies of the Lenders provided by law, upon the occurrence and during the continuance of an Event of Default, each Lender shall have the right, without prior notice to the Borrower, any such notice being expressly waived by the Borrower to the extent permitted by applicable law, upon any amount becoming due and payable by the Borrower hereunder or under the Notes or the other Loan Document (whether at the stated maturity, by acceleration or otherwise) to set-off and appropriate and apply against such amount any and all deposits (general or special, time or demand, provisional or final), in any currency, and any other credits, indebtedness or claims, in any currency, in each case whether direct or indirect, absolute or contingent, matured or unmatured, at any time held or owing by such Lender to or for the credit or the account of the Borrower.  Each Lender agrees promptly to notify the Borrower and the Administrative Agent after any such set-off and application made by such Lender, provided that the failure to give such notice shall not affect the validity of such set-off and application.

9.8Counterparts

This Agreement may be executed by one or more of the parties to this Agreement on any number of separate counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument.  A set of the copies of this Agreement signed by all the parties shall be lodged with the Borrower and the Administrative Agent.

9.9Severability

Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

9.10Integration

This Agreement and the other Loan Documents represent the agreement of the parties hereto with respect to the subject matter hereof, and there are no promises, undertakings, representations or warranties by the Administrative Agent or any Lender relative to the subject matter hereof not expressly set forth or referred to herein or in the other Loan Documents.

9.11GOVERNING LAW

THIS AGREEMENT AND THE NOTES, AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT AND THE NOTES, SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE COMMONWEALTH OF PENNSYLVANIA.

9.12Confidentiality

Each of the Lenders severally agrees that it will use reasonable precautions to keep confidential, in accordance with its customary procedures for handling confidential information of the same nature any non-public information supplied to it by the Borrower or any other Loan Party pursuant to the Loan Documents; provided that nothing herein shall prevent any Lender from disclosing any such information (a) to the Administrative Agent or any other Lender, (b) to any prospective assignee or participant in connection with any assignment or participation (or proposed assignment or participation) of Loans or commitments permitted by this Agreement so long as such assignee or participant is notified as to the confidential nature of such information and agrees to keep such information confidential, (c) to its employees, directors, agents, attorneys, accountants and other professional advisors, rating agencies, and funding sources, (d) upon the request or demand of any Governmental Authority having jurisdiction over such Lender, (e) in response to any order of any court or other Governmental Authority or as may otherwise be required pursuant to any Requirement of Law, (f) which has been publicly disclosed other than in breach of this Agreement or (g) in connection with the exercise of any remedy hereunder or under the Notes or other Loan Documents.

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9.13Submission To Jurisdiction; Waivers

.  The Borrower hereby irrevocably and unconditionally:

(a)submits for itself and its property in any legal action or proceeding relating to this Agreement, the Notes or the other Loan Documents, or for recognition and enforcement of any judgment in respect thereof, to the non-exclusive general jurisdiction of the courts of the Commonwealth of Pennsylvania, the courts of the United States of America for the Eastern District of Pennsylvania, and appellate courts from any thereof;

(b)consents that any such action or proceeding may be brought in such courts and waives any objection that it may now or hereafter have to the venue of any such action or proceeding in any such court or that such action or proceeding was brought in an inconvenient court and agrees not to plead or claim the same;

(c)waives and hereby acknowledges that it is estopped from raising any objection based on forum non conveniens, any claim that any of the above-referenced courts lack proper venue or any objection that any of such courts lack personal jurisdiction over it so as to prohibit such courts from adjudicating any issues raised in a complaint filed with such courts against the Borrower concerning this Agreement or the other Loan Documents;

(d)acknowledges and agrees that the choice of forum contained in this Section 9.13 shall not be deemed to preclude the enforcement of any judgment obtained in any forum or the taking of any action under the Loan Documents to enforce the same in any appropriate jurisdiction;

(e)agrees that service of process in any such action or proceeding may be effected by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, to the Borrower at its address set forth in Section 9.2 or at such other address of which the Administrative Agent shall have been notified pursuant thereto;

(f)agrees that nothing herein shall affect the right to effect service of process in any other manner permitted by law or shall limit the right to sue in any other jurisdiction; and

(g)waives, to the maximum extent not prohibited by law, any right it may have to claim or recover in any legal action or proceeding referred to in this subsection any special, exemplary or punitive or consequential damages.

9.14Acknowledgments

The Borrower hereby acknowledges that:

(a)it has been advised by counsel in the negotiation, execution and delivery of this Agreement, the Notes and the other Loan Documents;

(b)neither the Administrative Agent nor any Lender has any fiduciary relationship to the Borrower or any other party to the Loan Documents (or any of them) and the relationship hereunder between the Administrative Agent and Lenders, on the one hand, and the Borrower and its Affiliates parties to the Loan Documents, on the other hand, is solely that of debtor and creditor; and

(c)no joint venture exists among the Borrower and its Affiliates parties to the Loan Documents (or any of them) and the Lenders or the Administrative Agent.

9.15USA PATRIOT ACT

Each Lender that is subject to the requirements of the USA Patriot Act hereby notifies the Borrower and the other Loan Parties that pursuant to the requirements of the USA Patriot Act, it is required to obtain, verify and record information that identifies the Borrower and such other Loan Parties, which information includes the name and address of the Borrower and such other Loan Parties and other information that will allow such Lender to identify the Borrower and such other Loan Parties in accordance with the USA Patriot Act.

9.16WAIVERS OF JURY TRIAL

THE BORROWER, THE ADMINISTRATIVE AGENT AND EACH LENDER HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT, THE NOTES OR ANY OTHER LOAN DOCUMENT AND FOR ANY MANDATORY COUNTERCLAIM THEREIN.

[Signature Pages to Follow]

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IN WITNESS WHEREOF, the parties hereto, by their officers thereunto duly authorized, have executed this Agreement as of the day and year first above written.

KENEXA TECHNOLOGY, INC.

By: /s/ Donald F. Volk

Name:  Donald F. Volk

Title:    Chief Financial Officer

PNC BANK, NATIONAL ASSOCIATION, as Administrative Agent, Issuing Bank and a Lender

By: /s/ Daniel Takoushian

Name: Daniel Takoushian

Title: S.V.P.

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EX-99.1 5 ex99-1.htm JOINT FILING AGREEMENT

Exhibit 99.1

SCHEDULE 13D JOINT FILING AGREEMENT

The undersigned hereby agree as follows:

Each of them is individually eligible to use the Schedule 13D to which this Exhibit is attached, and such Schedule 13D is filed on behalf of each of them; and

Each of them is responsible for the timely filing of such Schedule 13D and any amendments thereto, and for the completeness and accuracy of the information concerning such person contained therein; but none of them is responsible for the completeness or accuracy of the information concerning the other person making the filing, unless such person knows or has reason to believe that such information is inaccurate.

Date: September 9, 2010

KENEXA CORPORATION

/s/ Nooruddin S. Karsan

Signature

Name: Nooruddin S. Karsan

Title: Chief Executive Officer

SPIRIT MERGER SUB, INC.

/s/ Donald F. Volk

Signature

Name: Donald F. Volk

Title: President

-----END PRIVACY-ENHANCED MESSAGE-----

EX-2.2

Exhibit 2.2

TENDER AND SUPPORT AGREEMENT

THIS TENDER AND SUPPORT AGREEMENT (this “Agreement”) dated as of August 31, 2010 is made by and among Kenexa Corporation, a Pennsylvania corporation (“Parent”), Spirit Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of Parent (“Purchaser”), and each stockholder listed on Annex I (each, a “Stockholder” and collectively, the “Stockholders”), each an owner of shares (the “Shares< /font>”) of common stock, par value $0.0001 per share, of Salary.com, Inc., a Delaware corporation (the “Company”).

WHEREAS, as of the date hereof, each Stockholder is the beneficial owner (as defined in Rule 13d-3 under the Exchange Act) of the number of Shares set forth opposite such Stockholder’s name under the heading “Shares Beneficially Owned” on Annex I (all such directly owned Shares which are outstanding as of the date hereof and which may hereafter be acquired pursuant to acquisition by purchase, stock dividend, distribution, stock split, split-up, combination, merger, consolidation, reorganization, recapitalization, combination or similar transaction, being referred to herein as the “Subject Shares;” provided that ̶ 0;Subject Shares” shall not include Shares beneficially owned in the form of Company Options or restricted stock, but only to the extent such Shares remain unvested, restricted or unexercised, as the case may be); and

WHEREAS, as a condition to their willingness to enter into the Agreement and Plan of Merger (the “Merger Agreement”) dated as of the date hereof by and among Parent, Purchaser and the Company, Parent and Purchaser have requested that each Stockholder, and in order to induce Parent and Purchaser to enter into the Merger Agreement, each Stockholder (only in such Stockholder’s capacity as a stockholder of the Company) has agreed to, enter into this Agreement; and

WHEREAS, capitalized terms used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Merger Agreement.

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

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ARTICLE 1

AGREEMENT TO TENDER

Section 1.01Agreement to Tender

(a).  Each Stockholder shall duly tender, in the Offer, all of such Stockholder’s Subject Shares pursuant to and in accordance with the terms of the Offer, provided that the Offer price does not decrease.  Promptly, but in any event no later than ten (10) Business Days after the commencement of the Offer, each Stockholder shall (i) deliver to the depositary designated in the Offer (the “Depositary”) (A) a letter of transmittal with respect to such Stockholder’s Subject Shares complying wi th the terms of the Offer, (B) a certificate or certificates representing such Subject Shares or, in the case of a book-entry transfer of any uncertificated Subject Shares, an “agent’s message” (or such other evidence, if any, of transfer as the Depositary may reasonably request) and (C) all other documents or instruments required to be delivered pursuant to the terms of the Offer, and/or (ii) instruct such Stockholder’s broker or such other Person that is the holder of record of Stockholder’s Subject Shares to tender such Subject Shares pursuant to and in accordance with the terms of the Offer. Purchaser may elect to provide a subsequent offering period for the Offer in accordance with the Merger Agreement, and each Stockholder shall duly tender to Purchaser during such subsequent offering period all of the Subject Shares, if any, which shall have been issued after the expiration of the Offer.  Each Stockholder agrees that once such Stockholder’s Subject Shares are tendered pursuant to the terms hereof, such Stockholder will not withdraw any tender of such Subject Shares, unless and until (x) the Offer shall have been terminated or shall have expired, in each case, in accordance with the terms of the Merger Agreement, or (y) this Agreement shall have been terminated in accordance with Section 4.03 hereof. The Stockholder acknowledges that Purchaser’s obligation to accept for payment and pay for the Subject Shares is subject to all of the terms and conditions of the Offer.

Section 1.02Voting of Subject Shares

(a).  At every meeting of the stockholders of the Company called for such purpose, and at every adjournment or postponement thereof, each Stockholder shall, or shall cause the holder of record on any applicable record date to, vote such Stockholder’s Subject Shares (to the extent that any of such Stockholder’s Subject Shares are not purchased in the Offer and provided that the Offer price was not decreased) (i) in favor of the adoption of the Merger Agreement and the transactions contemplated thereby; (ii) against (A) any agreement or arrangement related to any Acquisi tion Proposal, (B) any liquidation, dissolution, recapitalization, extraordinary dividend or other significant corporate reorganization of the Company or any of its Subsidiaries, and (C) any change in the present capitalization of the Company or any amendment to the Company’s certificate of incorporation or bylaws; (iii) in favor of any other matter necessary for consummation of the transactions contemplated by the Merger Agreement; and (iv) against any other action, proposal or agreement that would reasonably be expected, to (A) impede, interfere with, materially delay or postpone the Merger and the other transactions contemplated by the Merger Agreement or (B) result in a breach in any respect of any covenant, representation or warranty, or any other obligation or agreement of the Company under the Merger Agreement, and in connection therewith, such Stockholder shall execute any documents which are necessary or a ppropriate in order to effectuate the foregoing.  Each Stockholder shall retain at all times the right to vote such Stockholder’s Subject Shares in Stockholder’s sole discretion and without any other limitation on those matters other than those set forth in this Section 1.02 that are at any time or from time to time presented for consideration to the Company’s stockholders generally.  In the event that any meeting of the stockholders of the Company is held, such Stockholder shall, or shall cause the holder of record on any applicable record date to, appear at such meeting or otherwise cause such Stockholder’s Subject Shares (to the extent that any of such Stockholder’s Subject Shares are not purchased in the Offer and provided that the Offer price was not decreased) to be counted as present thereat for purposes of establishing a qu orum.

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ARTICLE 2

REPRESENTATIONS AND WARRANTIES

Section 2.01Representations and Warranties of the Stockholders

Each Stockholder hereby severally but not jointly represents and warrants to Parent and Purchaser as follows:

(a)Authorization; Validity of Agreement; Necessary Action.  Such Stockholder has all requisite power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby.  To the extent applicable, the execution and delivery of this Agreement and the consummation by the Stockholder of the transactions contemplated hereby have been duly authorized by all necessary action (corporate or otherwise) on the part of such Stockholder.  This Agreement has been duly executed and delivered by such Stockholder and constitutes a valid and binding obligation of such Stockholder, enforceable in accordance with its te rms (except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and to general equity principles).  If such Stockholder is married and the Shares set forth on Annex I hereto constitute community property under applicable laws, this Agreement has been duly authorized, executed and delivered by, and constitutes the valid and binding agreement of, such Stockholder’s spouse.

(b)Ownership.  As of the date hereof, the number of Shares beneficially owned (as defined in Rule 13d-3 under the Exchange Act) by such Stockholder is set forth opposite such Stockholder’s name under the heading “Shares Beneficially Owned” on Annex I.  Such Stockholder’s Subject Shares are, and (except as otherwise expressly permitted by this Agreement) any additional Shares and any options and warrants to purchase Shares, or any other securities of the Company convertible, exercisable or exchangeable into Shares that are acquired by the Stockholder after the date hereof and prior to the Effective Time will be, owned benefici ally by the Stockholder.  As of the date hereof, such Stockholder’s Subject Shares constitute all of the securities of the Company (other than Shares beneficially owned in the form of options to purchase Shares outstanding as of the date hereof) held of record, beneficially owned by or for which voting power or disposition power is held or shared by the Stockholder.  Such Stockholder has and (except as otherwise expressly permitted by this Agreement) will have at all times through the Effective Time sole voting power, sole power of disposition, sole power to issue instructions with respect to the matters set forth in Article 1, Article 3, and Section 4.03 hereof, and sole right, power and authority to agree to all of the matters set forth in this Agreement, in each case with respect to all of such Stockholder’s Subject Shares and with respect to all of such Stockholder’s Shares at all times through the Effective Time, with no limitations, qualifications or restrictions o n such rights, subject to applicable federal securities laws and the terms of this Agreement.  Except as set forth on Annex I, such Stockholder has good, valid and marketable title to such Stockholder’s Subject Shares, free and clear of all liabilities, claims, liens, options, proxies, changes, participations, and encumbrances of any kind or character whatsoever (collectively, “Liens”), other than those arising under the securities laws or under the Company’s governance documents, and such Stockholder will have good, valid, and marketable title to all of such Stockholder’s Shares at all times through the Effective Time, free and clear of any Liens, other than those arising under the securities laws or under the Company’s governance documents.  Such Stockholder further represents that any proxies heretofore given in respect of the Shares owned beneficially and of record by such Stockholder are revocable, and hereby revokes such proxies.

(c)No Violation.  The execution and delivery of this Agreement by such Stockholder does not, and the performance by such Stockholder of its obligations under this Agreement will not, (i) assuming the filing of such reports as may be required under Sections 13(d) and 16 of the Exchange Act, which such Stockholder will file, conflict with or violate any Law applicable to such Stockholder or by which any of such Stockholder’s assets or properties is bound or (ii) conflict with, result in any breach of or constitute a default (or an event that with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, or require payment under, or result in the creation of any Lien on the properties or assets of such Stockholder pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise or other instrument or obligation to which such Stockholder is a party or by which such Stockholder or any of such Stockholder’s assets or properties is bound, except for any of the foregoing as could not reasonably be expected, either individually or in the aggregate, to materially impair the ability of such Stockholder to perform such Stockholder’s obligations hereunder or to consummate the transactions contemplated hereby on a timely basis.  The execution and delivery of this Agreement by such Stockholder does not, and the performance of this Agreement by such Stockholder will not, require any consent, approval, authorization or permit of, or filing with or notification to any (i) Governmental Authority, excep t for filings that may be required under the Exchange Act and the HSR Act or (ii) third party (including with respect to individuals, any spouse, and with respect to trusts, any co-trustee or beneficiary).

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(d)Information.  None of the information relating to such Stockholder provided by or on behalf of such Stockholder in writing for inclusion in the Offer Documents, the Schedule 14D-9 or the Proxy Statement will, at the respective times such documents are filed with the SEC or are first published, sent or given to stockholders of the Company, contain any untrue statement of material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.

(e)Absence of Litigation.  As of the date hereof, there is no suit, action, investigation or proceeding pending or, to the knowledge of such Stockholder, threatened against such Stockholder before or by any Governmental Authority that would impair the ability of such Stockholder to perform its obligations hereunder or to consummate the transactions contemplated hereby on a timely basis.

(f)No Finder’s Fee. No broker, investment banker, financial advisor or other Person is entitled to any broker’s, finder’s, financial advisor’s or other similar fee or commission in connection with the transactions contemplated hereby based upon arrangements made by or on behalf of the Stockholder (other than in such Stockholder’s capacity as an officer or director of the Company and as disclosed pursuant to the Merger Agreement).

(g)Acknowledgement. The Stockholder (i) acknowledges receipt of, and has had an opportunity to read and understand and consult with independent counsel concerning, the Merger Agreement (including exhibits and schedules thereto); and (ii) understands and acknowledges that each of Parent and Purchaser is entering into the Merger Agreement in reliance upon such Stockholder’s execution, delivery and performance of this Agreement.

Section 2.02Representations and Warranties of Parent and Purchaser

Each of Parent and Purchaser, jointly and severally, hereby represents and warrants to each Stockholder as follows:

(a)Authorization; Validity of Agreement; Necessary Action.  Each of Parent and Purchaser is an entity duly organized, validly existing and in good standing under the laws of the state wherein it is formed.  Each of Parent and Purchaser has all requisite power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby.  The execution and delivery of this Agreement and the consummation by Parent and Purchaser of the transactions contemplated hereby have been duly authorized by all necessary action on the part of Parent and Purchaser.  This Agreement has been duly executed and delivere d by Parent and Purchaser and constitutes a valid and binding obligation of each of them, enforceable in accordance with its terms (except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and to general equity principles).

(b)No Conflicts

The execution and delivery of this Agreement by Parent and Purchaser does not, and the performance by each of them of its obligations under this Agreement will not, (i) conflict with or violate any Law applicable to Parent and Purchaser or by which any of their assets or properties is bound or (ii) conflict with, result in any breach of or constitute a default (or an event that with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, or require payment under, or result in the creation of any Lien on the properties or assets of Parent or Purchaser pursuant to, any note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise or other instrument or obligation to which Parent or Purchaser is a party or by w hich Parent or Purchaser or any of their respective assets or properties is bound, except for any of the foregoing in (i) or (ii) above as could not reasonably be expected, either individually or in the aggregate, to materially impair the ability of Parent and Purchaser to perform their obligations hereunder or to consummate the transactions contemplated hereby on a timely basis.  The execution and delivery of this Agreement by Parent and Purchaser does not, and the performance of this Agreement by Parent and Purchaser will not, require any consent, approval, authorization or permit of, or filing with or notification to any (i) Governmental Authority, except for filings that may be required under the Exchange Act and the HSR Act or (ii) third party, except, in the case of (i) or (ii) above, as could not reasonably be expected, either individually or in the aggregate, to materially impair the ability of Parent and Purchaser to perform their obligations hereunder or to consummate the transa ctions contemplated hereby on a timely basis..

4

ARTICLE 3

OTHER COVENANTS

Section 3.01(a) No Transfers

Each Stockholder hereby agrees, while this Agreement is in effect, and except as expressly contemplated hereby, not to, directly or indirectly (i) grant any proxies or enter into any voting trust or other agreement or arrangement with respect to the voting of any Shares or (ii) sell, transfer, pledge, encumber, assign, distribute, gift or otherwise dispose of (including by operation of law, other than by death of any person) (collectively, a “Transfer”) or enter into any contract, option or other arrangement or understanding with respect to any Transfer (whether by actual disposition or effective economic disposition due to hedging, cash settlement or otherwise) of, any of the Subject Shares, other securities of the Company owned beneficially or of rec ord as of the date hereof, any additional Shares and other securities of the Company acquired beneficially or of record by the Stockholder after the date hereof, or any interest therein. Such Stockholder shall not take any of the actions that the Company is prohibited from taking under Section 6.1 of the Merger Agreement.

Section 3.02Changes to Shares.  In case of a stock dividend or distribution, or any change in Shares by reason of any stock dividend or distribution, split-up, recapitalization, combination, exchange of shares or the like, the term “Shares” shall be deemed to refer to and include the Shares as well as all such stock dividends and distributions and any securities into which or for which any or all of the Shares may be changed or exchanged or which are received in such transaction.  Each Stockholder agrees, while this Agreement is in effect, to notify Parent promptly in writing of the number of any additional Shares or other securities of the Company acquired by such Stockholder, if any, after the date hereof.

Section 3.03No Inconsistent Arrangements.  Each Stockholder agrees, while this Agreement is in effect, (i) not to take, agree or commit to take any action that would reasonably be expected to make any representation or warranty of such Stockholder contained in this Agreement inaccurate in any respect as of any time during the term of this Agreement or (ii) to take all reasonable action necessary to prevent any such representation or warranty from being inaccurate in any respect at any such time.  Such Stockholder further agrees that it shall use commercially reasonable efforts to cooperate with Parent, as and to the extent reasonably reque sted by Parent, to effect the transactions contemplated hereby including the Offer and the Merger.

Section 3.04Appraisal Rights.  Such Stockholder hereby waives, and agrees not to exercise or assert, if applicable, any appraisal rights under Section 262 of the DGCL in connection with the Merger and to take all actions necessary to opt out of any class in any class action with respect to, any claim, derivative or otherwise, against the Company or any of its subsidiaries (or any of their respective successors) relating to the negotiation, execution and delivery of this Agreement or the Merger Agreement or the consummation of the Merger or any of the other transactions contemplated hereby or thereby.

Section 3.05Non-Solicitation. Between the date hereof and such time as this Agreement shall have been terminated in accordance with Section 4.03hereof,each Stockholder shall not, and shall not authorize or permit its Representatives to, directly or indirectly (i) initiate, solicit, or knowingly encourage or knowingly facilitate the submission of any inquiry, indication of interest, proposal or offer that constitutes, or would reasonably be expected to lead to, an Acquisit ion Proposal, (ii) participate in any discussions or negotiations regarding, or furnish any non-public information to any Person (other than Parent, Merger Sub or any designees of Parent or Merger Sub) in connection with, an Acquisition Proposal, (iii) enter into any letter of intent or agreement related to an Acquisition Proposal, or (iv) approve or recommend an Acquisition Proposal.

Section 3.06Documentation and Information. Each Stockholder (i) consents to and authorizes the publication and disclosure by Parent and its affiliates of its identity and holding of such Stockholder’s Subject Shares and the nature of its commitments and obligations under this Agreement in any announcement or disclosure required by the SEC or other Governmental Authority, the Offer Documents, or any other disclosure document in connection with the Offer, the Merger or any of the other transactions contemplated by the Merger Agreement or this Agreement, and (ii) agrees promptly to give to Parent any information it may reasonably require for the preparatio n of any such disclosure documents. Each Stockholder agrees to promptly notify Parent of any required corrections with respect to any written information supplied by it specifically for use in any such disclosure document, if and to the extent that any shall have become false or misleading in any material respect.

5

ARTICLE 4

MISCELLANEOUS

Section 4.01Notices

                All notices and other communications hereunder shall be in writing and shall be deemed given if delivered to Parent and Purchaser in accordance with Section 10.3 of the Merger Agreement and to each Stockholder at its address set forth below such Stockholder’s signature hereto (or at such other address for a party as shall be specified by like notice).

Section 4.02Further Assurances

Each Stockholder shall, from time to time, execute and deliver, or cause to be executed and delivered, such additional or further consents, documents and other instruments as Parent or Purchaser may reasonably request for the purpose of effectively carrying out the transactions contemplated by this Agreement.

Section 4.03Termination

This Agreement shall terminate upon the earlier of (i) the termination of the Merger Agreement in accordance with its terms (ii) the Effective Time, (iii) the termination or expiration of the Offer, without any shares being accepted for payment thereunder, (iv) upon reduction of the Offer Price or (v)upon mutual written agreement of the parties to terminate this Agreement.  In the event of a termination of this Agreement pursuant to this Section 4.03, this Agreement shall become void and of no effect with no liability on the part of any party hereto; provided that the provisions of Article 4, but excluding Section 4.02, shal l survive the termination of this Agreement, and no such termination shall relieve any party hereto from any liability for any breach of this Agreement occurring prior to such termination.

Section 4.04Amendments and Waivers.

(a)The parties hereto may modify or amend this Agreement by written agreement executed and delivered by duly authorized officers of the respective parties.

(b)Any failure of any of the parties to comply with any obligation, covenant, agreement or condition herein may be waived by the party or parties entitled to the benefits thereof only by a written instrument signed by the party expressly granting such waiver, but such waiver or failure to insist upon strict compliance with such obligation, covenant, agreement or condition shall not operate as a waiver of, or estoppel with respect to, any subsequent or other failure.

Section 4.05Expenses

All costs and expenses incurred in connection with this Agreement shall be paid by the party incurring such costs and expenses, whether or not the transactions contemplated by this Agreement or the Merger Agreement are consummated.

Section 4.06Binding Effect; Benefit; Assignment

Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned by any of the parties hereto (whether by operation of law or otherwise) without the prior written consent of the other parties.  Subject to the preceding sentence, this Agreement will be binding upon, inure to the benefit of and be enforceable by the parties and their respective permitted successors and assigns.

Section 4.07Governing Law

This Agreement shall be governed by, and construed in accordance with the laws of the State of Delaware, without giving effect to any choice or conflict of laws provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of the Laws of any jurisdiction other than the State of Delaware.

6

Section 4.08Jurisdiction

Each of the parties hereto hereby (a) expressly and irrevocably submits to the exclusive personal jurisdiction of the Delaware Court of Chancery, any other court of the State of Delaware and any Federal court sitting in the State of Delaware in the event any dispute arises out of this Agreement, (b) agrees that such party will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court, (c) agrees that such party will not bring any action relating to this Agreement in any court other than the Delaware Court of Chancery, any other court of the State of Delaware or any Federal court sitting in the State of Delaware and (d) agrees that each of the other parties shall have the right to bring any action or proceeding for enforcement of a judgment entered by the Delaware Court of Chancery, any other court of the State of Delaware and any Federal court sitting in the State of Delaware.  Each of Parent, Purchaser and each Stockholder agrees that a final judgment in any action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Law.

Section 4.09Service of Process

Each party irrevocably consents to the service of process outside the territorial jurisdiction of the courts referred to in Section 4.08 hereof in any such action or proceeding by mailing copies thereof by registered or certified United States mail, postage prepaid, return receipt requested, to such party’s address as specified in or pursuant to Section 4.01 hereof.  However, the foregoing shall not limit the right of a party to effect service of process on the other party by any other legally available method.

Section 4.10Waiver of Jury Trial

EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY OR DISPUTE THAT MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.  EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (i) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (ii) EACH SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (iii) EACH SUCH PARTY MAKES THIS WAIVER VOLUNTARILY AND (iv) EACH SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS OF THIS SECTION.

Section 4.11Entire Agreement; Third Party Beneficiaries

.  This Agreement (a) constitutes the entire agreement and supersedes all prior agreements and understandings, both written and oral, among the parties with respect to the subject matter hereof and (b) is not intended to confer upon any Person other than the parties hereto any rights or remedies hereunder.

Section 4.12Severability

If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction or other authority to be invalid, void, unenforceable or against its regulatory policy, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated.

7

Section 4.13Specific Performance

Each of the parties hereto acknowledges and agrees that, in the event of any breach of this Agreement, each nonbreaching party would be irreparably and immediately harmed and could not be made whole by monetary damages.  It is accordingly agreed that the parties hereto (a) will waive, in any action for specific performance, the defense of adequacy of a remedy at law and (b) shall be entitled, in addition to any other remedy to which they may be entitled at law or in equity, to compel specific performance of this Agreement in any action instituted in accordance with Section 4.08 hereof.

Section 4.14Stockholder Capacity

Notwithstanding any provision of this Agreement to the contrary, nothing in this Agreement shall (or shall require any Stockholder to attempt to) affect or limit any Stockholder who is a director or officer of the Company from acting in such capacity (it being understood that this Agreement shall apply to each Stockholder solely in each Stockholder’s capacity as a stockholder of the Company).

Section 4.15Stockholder Obligations Several and Not Joint

The obligations of each Stockholder hereunder shall be several and not joint and no Stockholder shall be liable for any breach of the terms of this Agreement by any other Stockholder.

Section 4.16Headings.  The Section headings contained in this Agreement are inserted for convenience only and shall not affect in any way the meaning or interpretation of this Agreement.

Section 4.17Interpretation.  Any reference to any national, state, local or foreign Law shall be deemed also to refer to all rules and regulations promulgated thereunder, unless the context otherwise requires. When a reference is made in this Agreement to Sections, such reference shall be to a Section to this Agreement unless otherwise indicated. Whenever the words “include,” “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation.”

Section 4.18No Presumption.  This Agreement shall be construed without regard to any presumption or rule requiring construction or interpretation against the party drafting or causing any instrument to be drafted.

Section 4.19Counterparts

This Agreement may be executed in multiple counterparts, all of which shall together be considered one and the same agreement.

8

                IN WITNESS WHEREOF, the parties hereto have caused this Tender and Support Agreement to be duly executed as of the day and year first above written.

KENEXA CORPORATION
By:	// Nooruddin S. Karsan
	Name: Nooruddin S. Karsan
	Title: Chief Executive Officer

SPIRIT MERGER SUB, INC.
By:	/s/ Donald F. Volk
	Name: Donald F. Volk
	Title: President

9

IN WITNESS WHEREOF, the parties hereto have caused this Tender and Support Agreement to be duly executed as of the day and year first above written.

/s/ Bryce Chicoyne

Bryce Chicoyne

Notice Address:

(Notice address omitted)

/s/ G. Kent Plunkett

G. Kent Plunkett

Notice Address:

(Notice address omitted)

/s/ Yong Zhang

Yong Zhang

Notice Address:

(Notice address omitted)

/s/ Paul Daoust

Paul Daoust

Notice Address:

(Notice address omitted)

/s/ John Gregg

John Gregg

Notice Address:

(Notice address omitted)

/s/ Edward McCauley

Edward McCauley

Notice Address:

(Notice address omitted)

/s/ John Sumser

John Sumser

Notice Address:

(Notice address omitted)

/s/ Terry Temescu

Terry Temescu

Notice Address:

(Notice address omitted)

/s/ Robert Trevisani

Robert Trevisani

Notice Address:

(Notice address omitted)

/s/ William Martin

William Martin

Notice Address:

(Notice address omitted)

/s/ Teresa Shipp

Teresa Shipp

Notice Address:

(Notice address omitted)

/s/ Brent Kleiman

Brent Kleiman

Notice Address:

(Notice address omitted)

/s/ Judy Duff

Judy Duff

Notice Address:

(Notice address omitted)

/s/ Nicholas Camelio

Nicholas Camelio

Notice Address:

(Notice address omitted)

10

ANNEX I

Stockholder	Shares Beneficially Owned	Subject Shares Outstanding as of the date of this Agreement
Bryce Chicoyne	56,772	56,772
Paul R. Daoust	95,551	73,115
John F. Gregg	176,246	159,381
Terry Temescu	36,961	24,497
Yong Zhang	313,001	241,798
Robert A. Trevisani	85,256	62,231
William C. Martin	1,616,295	1,612,870
Edward F. McCauley	100,741	97,316
G. Kent Plunkett	2,997,378	2,457,792
John R. Sumser	66,612	49,747
Brent Kleiman	39,237	39,237
Teresa Shipp	195,275	148,083
Judy Duff	26,254	26,254
Nicholas Camelio	49,845	37,345

11

EX-10.1

Exhibit 10.1

______________________________________________________________________________

CREDIT AGREEMENT

dated as of

August 31, 2010

among

KENEXA TECHNOLOGY, INC.

The Several Lenders From Time to Time

Parties Hereto,

PNC BANK, NATIONAL ASSOCIATION,

as Administrative Agent and Issuing Bank

____________________________________________________________________________

1

TABLE OF CONTENTS

	Page
SECTION 1. DEFINITIONS	5
1.1  Defined Terms	5
1.2  Other Definitional Provisions	18
SECTION 2. LOANS AND TERMS OF COMMITMENTS	19
2.1  Revolving Credit Commitments	19
2.2  Revolving Credit Notes	19
2.3  Procedure for Revolving Credit Loans	19
2.4  Letter of Credit Subfacility	20
2.5  Interest and Payment Dates	24
2.6  Default Interest	24
2.7  Conversion and Continuation Options; Limitations on Tranches	24
2.8  Commitment Fees	25
2.9  Termination and Reduction of Revolving Credit Commitments	25
2.10  Optional and Mandatory Prepayments of Loans	26
2.11  Illegality	27
2.12  Requirements of Law	27
2.13  Taxes	28
2.14  Indemnity	28
2.15  Treatment of Loans and Payments	29
2.16  Payments	29
2.17  Loan Accounts	29
2.18  Assignment of Loans and/or Revolving Credit Commitments Under Certain Circumstances; Duty to Mitigate	29
2.19  Use of Proceeds	29
SECTION 3. REPRESENTATIONS AND WARRANTIES	30
3.1  Corporate Existence	30
3.2  Subsidiaries	30
3.3  Authority and Binding Effect	30
3.4  Approvals	30
3.5  Recording and Enforceability	31
3.6  Litigation	31
3.7 Financial Information	31
3.8  Taxes	31
3.9  Intellectual Property	31
3.10  Intentionally Omitted	32
3.11  Material Agreements	32
3.12  Compliance With Law	32
3.13  Title to Property	32
3.14  Security Interests	32
3.15  Federal Regulations	33
3.16  ERISA	33
3.17  Fictitious Names	33
3.18  No Event of Default	33
3.19  Solvency	33
3.20  Investment Company Act	33
3.21  Environmental Matters	34
3.22  Labor Matters	34
3.23  Anti-Terrorism Laws	34
3.24  [INTENTIONALLY OMITTED]	35
3.25  No Burdensome Agreements	35
3.26  No Misrepresentations or Material Nondisclosures	35
SECTION 4. CONDITIONS PRECEDENT	36
4.1  Conditions to Closing	36
4.2  Conditions to Each Loan or Letter of Credit	37
4.3  Closing	37

2

TABLE OF CONTENTS

	Page
SECTION 5. AFFIRMATIVE COVENANTS	38
5.1  Furnishing Financial Statements	38
5.2  Books and Records	40
5.3  Taxes	40
5.4  Corporate Existence and Rights; Compliance with Laws	40
5.5  Maintenance of Properties	40
5.6  Performance and Compliance with Material Agreements	40
5.7  Insurance	40
5.8  Inspection; Collateral Audit	41
5.9  Leases and Mortgages	41
5.10  Pay Indebtedness and Perform Other Covenants	41
5.11 Notices	41
5.12  Deposit Accounts	42
5.13  ERISA	42
5.14  Environmental Laws	42
5.15  Notice and Joinder of New Subsidiaries	43
5.16  Anti-Terrorism Laws	43
SECTION 6. NEGATIVE COVENANTS	44
6.1  Financial Covenants	44
6.2  Limitation on Indebtedness	44
6.3  Limitation on Liens	45
6.4  Limitations on Fundamental Changes	46
6.5  Limitations on Sale of Assets	46
6.6  Limitations on Acquisitions and other Investments	47
6.7  Limitation on Distributions	47
6.8  Transactions with Affiliates	47
6.9  Sale on Leaseback	47
6.10  Continuation of or Change in Business	47
6.11  Limitation on Negative Pledge	47
6.12  Limitation on Optional Prepayment of Indebtedness	48
6.13  Use of Proceeds	48
6.14  Fiscal Year	48
6.15  Clauses Restricting Subsidiary Distributions	48
6.16  Limitation on Activities of the Parent	48
6.17 No Misrepresentations or Material Nondisclosure	48
6.18  Kenexa SA PTE Ltd. (South Africa)	48
SECTION 7.  EVENTS OF DEFAULT	49
7.1  Events of Default	49
7.2  Remedies	50
SECTION 8.  THE ADMINISTRATIVE AGENT	51
8.1  Appointment	51
8.2  Delegation of Duties	51
8.3  Exculpatory Provisions	51
8.4  Reliance by Administrative Agent	51
8.5  Notice of Default	51
8.6  Non-Reliance on Administrative Agent and Other Lenders	52
8.7  Indemnification	52
8.8 Administrative Agent in Its Individual Capacity	52
8.9  Release of Liens	52
8.10  Successor Administrative Agent	52
8.11  USA Patriot Act	52
8.12  Beneficiaries	52

3

TABLE OF CONTENTS

	Page
SECTION 9. MISCELLANEOUS	53
9.1  Amendments and Waivers	53
9.2  Notices	54
9.3  No Waiver; Cumilative Remedies	55
9.4  Survival of Representations and Warranties	55
9.5  Payment of Expenses and Taxes	55
9.6  Successort and Assigns	56
9.7  Adjustments; Set-off	57
9.8  Counterparts	57
9.9  Severability	57
9.10  Integration	57
9.11 GOVERNING LAW	57
9.12  Confidentiality	57
9.13  Submission To Jurisdiction; Waivers	58
9.14  Acknowledgements	58
9.15  USA PATRIOT ACT	58
9.16  WAIVERS OF JURY TRIAL	58

4

CREDIT AGREEMENT

THIS CREDIT AGREEMENT, dated as of August 31, 2010, is among KENEXA TECHNOLOGY, INC., a Pennsylvania corporation (the “Borrower”), the several banks and other financial institutions from time to time parties hereto (individually, a “Lender” or “Revolving Credit Lender”; collectively, the “Lenders” or the “Revolving Credit Lenders”) and PNC BANK, NATIONAL ASSOCIATION, as Administrative Agent (in such capacity, the “Administrative Agent”).

W I T N E S S E T H:

In consideration of the premises and other valuable consideration, the receipt and adequacy of which are hereby acknowledged, and with the intent to be legally bound hereby, the parties hereto agree as follows:

SECTION 1.  DEFINITIONS

1.1Defined Terms

.  As used in this Agreement, the following terms shall have the following meanings:

“Accumulated Funding Deficiency”:  any accumulated funding deficiency as defined in Sections 302(a) of ERISA and 412(a) of the Code prior to the amendment by the Pension Protection Act of 2006.

“Adjusted Funding Target Attainment Percentage”:  an adjusted target attainment percentage as defined in Sections 206(g)(9) of ERISA and 436(j) of the Code.

“Administrative Agent”:  as defined in the Preamble hereto, and its successors in such capacity appointed pursuant to Section 8.10.

“Affiliate”:  as to any Person, any other Person which, directly or indirectly, through one or more intermediaries, controls, or is controlled by, or is under common control with, such Person and any member, partner, director, officer or employee of any such Person.  For purposes of this definition, “control” shall mean the power, directly or indirectly, either to (a) vote 10% or more of the Capital Stock of such Person, (b) vote 10% or more of the securities having ordinary voting power for the election of directors of such Person or (c) direct or in effect cause the direction of the management and policies of such Person whether by contract or otherwise.

“Agreement”:  this Credit Agreement, as amended, supplemented or otherwise modified from time to time.

“Anti-Terrorism Laws”:  any laws relating to terrorism or money laundering, including Executive Order No. 13224 and the USA Patriot Act.

“Application”:  in respect of each Letter of Credit issued by the Issuing Bank, an application, in such form as the Issuing Bank may specify from time to time, requesting issuance of such Letter of Credit, as it may be amended, supplemented or modified from time to time.

“Asset Sale”:  as defined in subsection 2.10(c).

“Assignment and Assumption”:  an assignment and assumption entered into by a Lender and a Purchasing Lender in accordance with and subject to the terms and conditions of Section 9.6, substantially in the form of Exhibit D attached hereto, or such other form as shall be approved by the Administrative Agent, as it may be amended, supplemented or modified from time to time.

5

“Base Rate”: for any day, a fluctuating per annum rate of interest equal to the highest of (a) the Prime Rate in effect on such day, (b) the Federal Funds Open Rate in effect on such day plus ½ of 1% and (c) the Daily LIBOR Rate in effect on such day plus one hundred basis points (1.00%).  If for any reason the Administrative Agent shall have determined (which determination shall be conclusive absent manifest error) that it is unable to ascertain the Federal Funds Open Rate or the Daily LIBOR Rate for any reason, the Base Rate shall be determined without regard to clause (b) or (c) as the case may be, of the first sentence of this definition until the circumstances giving rise to such inability no longer exist.  Any change in the Base Rate due to a change in the Prime Rate, the Federal Funds Open Rate or the Daily LIBOR Rate shall be effective on the effective date of such change in the Prime Rate, the Federal Funds Open Rate or the Daily LIBOR Rate,  respectively.

“Base Rate Borrowing”:  a Borrowing comprised of Base Rate Loans.

“Base Rate Loans”:  any Loan bearing interest at a rate determined by reference to the Base Rate.

“Borrower”:  as defined in the Preamble hereto.

“Borrowing”:  each group of Loans of a single Type made by the Lenders on a single date and, in the case of Eurodollar Loans, as to which a single Interest Period is in effect.

“Borrowing Availability”:  at any particular time, an amount equal to the excess, if any, of (a) the aggregate Revolving Credit Commitments of the Revolving Credit Lenders at such time over (b) the aggregate Revolving Credit Exposure of the Revolving Credit Lenders at such time.

“Borrowing Date”:  any Business Day on which a Loan is to be made at the request of the Borrower under this Agreement.

“Budget”: as defined in subsection 5.1(i).

“Business Day”:  a day other than a Saturday, Sunday or other day on which commercial banks in Pittsburgh or Philadelphia, Pennsylvania, are authorized or required by law or other governmental action to close and if the applicable Business Day relates to any Eurodollar Loan, such day must also be a day on which dealings are carried on in the London interbank market.

“Capital Expenditures”:  any expenditure of the Parent or any Subsidiary of the Parent which would be classified as a capital expenditure in accordance with GAAP.

“Capital Lease”:  at any time, a lease with respect to which the lessee is required to recognize the acquisition of an asset and the incurrence of a liability in accordance with GAAP.

“Capital Lease Obligations”:  at any time, the amount of the obligations under Capital Leases which would be shown at such time as a liability on a consolidated balance sheet of the Parent and its consolidated Subsidiaries prepared in accordance with GAAP.

“Capital Stock”:  any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all partnership interests in a partnership (general or limited), any and all equivalent ownership interests in a Person (other than a corporation or partnership), including interests in a limited liability company, and any and all warrants or options to purchase any of the foregoing.

“Cash Equivalents”:  (a) securities with maturities of 90 days or less from the date of acquisition issued or fully guaranteed or insured by the United States or any agency thereof, (b) certificates of deposit with maturities of 90 days or less from the date of acquisition and overnight bank deposits of any commercial bank having capital, surplus and undivided profits aggregating at least $500,000,000, (c) repurchase obligations of any commercial bank satisfying the requirements of clause (b) of this definition, (d) commercial paper of a domestic issuer rated at least A-2 or better by S&P or P-2 or better by Moody’s and in either case maturing within 90 days after the date of acquisition, (e) securities with maturitie s of 90 days or less from the date of acquisition issued or fully guaranteed by any state, commonwealth or territory of the United States or by any political subdivision or taxing authority of any such state, commonwealth or territory, and such securities of such state commonwealth, territory, political subdivision or taxing authority, as the case may be, are rated at least A by S&P or A by Moody’s, (f) securities with maturities of 90 days or less from the date of acquisition backed by standby letters of credit issued by any commercial bank satisfying the requirements of clause (b) of this definition, or (g) shares of “money market funds” within the meaning of Rule 2a-7 of the Investment Company Act of 1940, as amended.

“Change of Control”:  any transaction or occurrence or series of transactions or occurrences which results at any time in:

(a)any Person or group of Persons (within the meaning of Sections 13(d) or 14(a) of the Securities Exchange Act of 1934, as amended) shall have acquired, after the Closing Date, beneficial ownership of (within the meaning of Rule 13d-3 promulgated by the SEC under said Act) 30.00% or more of the voting Capital Stock of the Parent;

(b)within a period of twelve (12) consecutive calendar months, individuals who were directors of the Parent on the first day of such period (together with any new directors whose election by the board of directors of the Parent or whose nomination for election by the shareholders of the Parent was approved by a vote of a majority of the directors then still in office who were either directors as of the first day of such period or whose election or nomination for election was previously so approved) shall cease to constitute a majority of the board of directors of the Parent; or

(c)the Parent ceasing to own, whether directly or indirectly, beneficially and of record less than one hundred percent (100%) of each class of Capital Stock of the Borrower and any other Subsidiary of the Parent formed in connection with a Permitted Acquisition.

“Closing” and “Closing Date”:  as defined in Section 4.3.

“Code”:  the Internal Revenue Code of 1986, as amended from time to time.

“Collateral”:  all property of the Parent, Borrower and the other Loan Parties which is at the time subject to the Lien of any of the Security Documents in favor of the Administrative Agent for the benefit of the holders of the Obligations.

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“Commitment Fees”:  as defined in Section 2.8.

“Commonly Controlled Entity”:  an entity, whether or not incorporated, which is under common control with the Parent within the meaning of Section 4001 of ERISA or is part of a group which includes the Parent and which is treated as a single employer under Section 414(b), (c), (m) or (o) of the Code.

“Compliance Certificate”:  as defined in subsection 5.1(c).

“Consideration”:  with respect to any acquisition, the consideration paid or proposed to be paid by the Parent and its Subsidiaries with respect to such acquisition (including earnouts, payments under non-compete arrangements and any assumption of Indebtedness).

“Contractual Obligation”:  as to any Person, any provision of any security issued by such Person or any provision of any agreement, instrument or other undertaking to which such Person is a party or by which it or any of its property is bound.

“Daily LIBOR Rate”: for any day, the rate per annum determined by the Administrative Agent by dividing (the resulting quotient rounded upwards, if necessary, to the nearest 1/100th of 1%) (a) the Published Rate by (b) a number equal to 1.00 minus the Eurocurrency Reserve Percentage.  The Published Rate shall be adjusted as of each Business Day based on changes in the Published Rate or the Eurocurrency Reserve Percentage without notice to the Borrower, and shall be applicable from the effective date of any such change.

“Default”:  any of the events specified in Section 7.1, whether or not any requirement for the giving of notice, the lapse of time, or both, or any other condition precedent therein set forth, has been satisfied.

“Default Rate”:  as defined in Section 2.6.

“Distribution”:  in respect of any Capital Stock of any Person (a) dividends or other distributions on such Capital Stock (except distributions in other Capital Stock of such Person) and (b) the redemption or acquisition of such Capital Stock or of warrants, rights or other options to purchase such Capital Stock (except when solely in exchange for Capital Stock of such Person), including, without limitation, any payments on or in respect of any redeemable preferred stock of such Person.

“Dollars” and “$”:  dollars in lawful currency of the United States of America.

“Domestic Subsidiary”:  any Subsidiary other than a Foreign Subsidiary.

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“EBITDA”:  for any period, net income (excluding (i) non-cash equity compensation expenses and (ii) interest income, in each case for such period), plus, to the extent deducted from such net income, the sum of (a) gross interest expense, (b) income taxes, and (c) depreciation and amortization, all as determined for the Parent and its Subsidiaries on a consolidated basis in accordance with GAAP and without duplication; provided that, if at any time during such period the Parent or any of its Subsidiaries shall have sold or otherwise divested any material assets or stock in any Subsidiary, any book gai n or loss resulting from such sale or other divestiture, together with the net income or loss of such Subsidiary or attributable to such assets shall also be excluded from net income.  As used in the definitions of Modified EBITDA and Permitted Acquisition, EBITDA shall also be determined for any Person who has (or whose assets have) been acquired by a Loan Party to the extent provided in such definition.

“Employee Pension Plan”:  any pension plan which (a) is maintained by the Parent or any Affiliate and (b) is subject to Part 3 of Title I of ERISA.

“Environmental Laws”:  any and all Federal, state, local, municipal or foreign laws, rules, orders, regulations, statutes, ordinances, codes, decrees or binding requirements of any Governmental Authority, or binding Requirement of Law regulating, relating to or imposing liability or standards of conduct concerning protection of the environment, as now or may at any time hereafter be in effect.

“ERISA”:  the Employee Retirement Income Security Act of 1974, as amended, and any regulations issued thereunder by the Department of Labor or PBGC.

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

“Eurodollar Borrowing”:  a Borrowing comprised of Eurodollar Loans.

“Eurodollar Loan”:  any Loan bearing interest at a rate determined by reference to the Eurodollar Rate in accordance with the provisions of Section 2.

“Eurodollar Rate”:  with respect to the Loans comprising any Eurodollar Borrowing for any Interest Period, the interest rate per annum determined by the Administrative Agent by dividing (the resulting quotient rounded upwards, if necessary, to the nearest 1/100th of 1% per annum) (a) the rate which appears on the Bloomberg Page BBAM1 (or on such other substitute Bloomberg page that displays rates at which US dollar deposits are offered by leading banks in the London interbank deposit market), or the rate which is quoted by another source selected by the Administrative Agent which has been approved by the British Bankers’ Association as an authorized information ve ndor for the purpose of displaying rates at which US dollar deposits are offered by leading banks in the London interbank deposit market (for purposes of this definition, an “Alternate Source”), at approximately 11:00 a.m., London time, two (2) Business Days prior to the commencement of such Interest Period as the London interbank offered rate for U.S. Dollars for an amount comparable to such Eurodollar Borrowing and having a borrowing date and a maturity comparable to such Interest Period (of if there shall at any time, for any reason, no longer exist a Bloomberg Page BBAM1 (or any substitute page) or any Alternate Source, a comparable replacement rate determined by the Administrative Agent at such time (which determination shall be conclusive absent manifest error)), by (b) a number equal to 1.00 minus the Eurocurrency Reserve Percentage.  The Eurodollar Rate may also be expressed by the following formula:

Eurodollar Rate = London interbank offered rates quoted by Bloomberg

or appropriate successor as shown on Bloomberg Page BBAM1

1.00 - Eurocurrency Reserve Percentage

The Eurodollar Rate shall be adjusted with respect to any Eurodollar Borrowing that is outstanding on the effective date of any change in the Eurocurrency Reserve Percentage as of such effective date.  The Administrative Agent shall give prompt notice to the Borrower of the Eurodollar Rate as determined or adjusted in accordance herewith, which determination shall be conclusive absent manifest error.

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“Event of Default”:  any of the events specified in Section 7, provided that any requirement for the giving of notice, the lapse of time, or both, or any other condition, has been satisfied.

“Excluded Taxes”:  with respect to the Administrative Agent, any Lender, any Issuing Bank or any other recipient of any payment to be made by or on account of any obligation of Borrower hereunder (a) income or franchise taxes imposed on (or measured by) its net income by the United States of America, or by the jurisdiction under the laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable lending office is located, (b) any branch profits taxes imposed by the United States of America or any similar tax imposed by any other jurisdiction in which Borrower is located and (c) in the case of a Foreign Lender (other than an assignee pursuant to a request by Borr ower under Section 2.18), any withholding tax that is imposed on amounts payable to such Foreign Lender at the time such Foreign Lender becomes a party to this Agreement (or designates a new lending office) or is attributable to such Foreign Lender’s failure to comply with subsection 2.13(b), 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 Borrower with respect to such withholding tax pursuant to Section 2.13.

“Executive Order No. 13224”:  Executive Order No. 13224 on Terrorist Financing, effective September 24, 2001, as the same has been, or shall hereafter be, renewed, extended, amended or replaced.

“Existing Letters of Credit”:  those letters of credit issued by PNC which are outstanding on the Closing Date.  A list of the Existing Letters of Credit is set forth on Schedule III.

“Fee Letter”:  the commitment letter dated as of August 4, 2010, signed by the Borrower and PNC.

“Federal Funds Effective Rate”:  for any day, the rate per annum (based on a year of three hundred sixty (360) days and actual days elapsed and rounded upward to the nearest 1/100 of one percent (1%)) announced by the Federal Reserve Bank of New York (or any successor) on such day as being the weighted average of the rates on overnight federal funds transactions arranged by federal funds brokers on the previous trading day, as computed and announced by such Federal Reserve Bank (or any successor) in substantially the same manner as such Federal Reserve Bank computes and announces the weighted average it refers to as the “Federal Funds Effective Rate” as of the date of this Agreement; provided, if such Federal Reserve Bank (or its successor) does not announce such rate on any day, the “Federal Funds Effective Rate” for such day shall be the Federal Funds Effective Rate for the last day on which such rate was announced.

“Federal Funds Open Rate”:  for any day, the rate per annum (based on a year of 360 days and actual days elapsed) which is the daily federal funds open rate as quoted by ICAP North America, Inc. (or any successor) as set forth on the Bloomberg Screen BTMM for that day opposite the caption “OPEN” (or on such other substitute Bloomberg Screen that displays such rate), or as set forth on such other recognized electronic source used for the purpose of displaying such rate as selected by the Administrative Agent (an “Alternate Source”) (or if such rate for such day does not appear on the Bloomberg Screen BTMM (or any substitute screen) or on any Alternate Source, or if there shall at any time, for any reason, no longer exist a Bloomberg Screen BTMM (or any substitute screen) or any Alternate Source, a comparable replacement rate determined by the Administrative Agent at such time (which determination shall be conclusive absent manifest error); provided however, that if such day is not a Business Day, the Federal Funds Open Rate for such day shall be the “open” rate on the immediately preceding Business Day.

“Foreign Benefit Event”:  with respect to any Foreign Pension Plan, (a) the existence of unfunded liabilities in excess of the amount permitted under any applicable law, or in excess of the amount that would be permitted absent a waiver from a Governmental Authority, (b) the failure to make the required contributions or payments, under any applicable law, on or before the due date for such contributions or payments, (c) the receipt of a notice of a Governmental Authority relating to the intention to terminate any such Foreign Pension Plan or to appoint a trustee or similar official to administer any such Foreign Pension Plan or alleging the insolvency of any such Foreign Plan, (d) the incurrence of any liability in excess of $250,00 0 in the aggregate by the Parent and its Subsidiaries under applicable law and on account of the complete or partial termination of such Foreign Pension Plan or the complete or partial withdrawal of any participating employer therein, or (e) the occurrence of any transaction that is prohibited under any applicable law and that would reasonably be expected to result in the incurrence of any liability by the Parent and its Subsidiaries or the imposition on the Parent and its Subsidiaries of any fine, excise tax or penalty resulting from any noncompliance with any applicable law, in each in excess of in the aggregate $250,000.

“Foreign Lender”:  any Lender that is not organized under the laws of the United States of America, any State thereof or the District of Columbia.

“Foreign Pension Plan”:  any benefit plan maintained by a Foreign Subsidiary that under applicable law is required to be funded through a trust or other funding vehicle other than a trust or funding vehicle maintained exclusively by a Governmental Authority.

“Foreign Subsidiary”:  any Subsidiary not organized under the laws of the United States of America, any State thereof or the District of Columbia.

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“GAAP”:  at any time with respect to the determination of the character or amount of any asset or liability or item of income or expense, or any consolidation or other accounting computation, generally accepted accounting principles as in effect in the United States on the date of, or at the end of the period covered by, the financial statements from which such asset, liability, item of income, or item of expense, is derived, or, in the case of any such computation, as in effect on the date when such computation is required to be determined, consistently applied.

“Governmental Acts”:  as defined in subsection 2.4(j).

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

“Guarantor”:  the Parent and each Subsidiary of the Parent now or hereafter executing and delivering a Guaranty.  The initial Guarantors shall be the Parent, Kenexa Government Solutions, Inc., Kenexa Strategic Outsourcing Corporation, Devon Royce, Inc., Nextworx, Inc., Kenexa Recruiter, Inc. and Kenexa BrassRing, Inc.

“Guaranty”:  a Guaranty and Suretyship Agreement delivered to the Administrative Agent by a Guarantor substantially in the form of Exhibit C hereto, as the same may be amended, supplemented or otherwise modified from time to time.

“Guaranty Obligation”:  as to any Person, any guarantee of payment or performance by such Person of any Indebtedness or other obligation of any other Person, or any agreement to provide financial assurance with respect to the financial condition, or the payment of the obligations of, such other Person (including, without limitation, purchase or repurchase agreements, reimbursement agreements with respect to letters of credit or acceptances, indemnity arrangements, grants of security interests to support the obligations of another Person, keepwell agreements and take-or-pay or through-put arrangements) which has the effect of assuring or holding harmless any third Person against loss with respect to one or more obligations of such third Person; provided, however, the term Guaranty Obligation shall not include endorsements of instruments for deposit or collection in the ordinary course of business.  The amount of any Guaranty Obligation of any Person shall be deemed to be the lower of (a) an amount equal to the stated or determinable amount of the primary obligation in respect of which such Guaranty Obligation is made and (b) the maximum amount for which such contingently liable Person may be liable pursuant to the terms of the instrument embodying such Guaranty Obligation, unless the maximum amount is not stated or determinable, in which case the amount of such Guaranty Obligation shall be such contingently liable Person’s maximum reasonably anticipated liability in respect thereof as determined by such Person in good faith and approved by the Administrative Agent.  Guaranty Obligations of any Person shall include the amount of any future “earn-out” or similar payments to be made to any other Person in connection with a Permitted Acquisition to the extent included in accordance with GAAP as a liability on the balance sheet of such Person.

“Hedge Agreement”:  any (a) interest rate swap agreement, interest rate cap agreement, interest rate floor agreement, interest rate collar agreement, interest rate option or any other agreement regarding the hedging of interest rate risk exposure executed in connection with hedging the interest rate exposure of any Person and any confirming letter executed pursuant to such agreement and (b) a foreign exchange contract, currency swap agreement, futures contract, option contract, synthetic cap or any other agreement regarding the hedging of fluctuations of currency values and any confirming letter executed pursuant to such agreement, all as amended, restated, supplemented or otherwise modified from time to time.

“Indebtedness”:  of any Person at any date, without duplication:

(a)all indebtedness of such Person for borrowed money or for the deferred purchase price of property or services (other than trade liabilities incurred in the ordinary course of business not more than 60 days overdue (or being contested in good faith) and payable in accordance with customary practices), including seller’s notes and to the extent included as a liability on the balance sheet of such Person in accordance with GAAP, earn-outs and similar obligations,

(b)any other indebtedness which is evidenced by a note, bond, debenture or similar instrument,

(c)all Capital Lease Obligations of such Person,

(d)all reimbursement and other obligations of such Person in respect of letters of credit, bankers’ acceptances and similar obligations created for the account of such Person, in each case whether or not matured,

(e)all liabilities secured by any Lien on any property owned by such Person even though such Person has not assumed or otherwise become liable for the payment thereof,

(f)all liabilities with respect to redeemable preferred stock obligations arising prior to the Revolving Credit Termination Date,

(g)net liabilities of such Person under any Hedge Agreements, foreign currency exchange agreements, netting agreements and other hedging agreements or arrangements (calculated on a basis satisfactory to the Administrative Agent and in accordance with accepted practice),

(h)withdrawal liabilities of such Person or any Commonly Controlled Entity under a Plan or withdrawal liabilities of such Person under a Foreign Pension Plan, and

(i)all Guaranty Obligations of such Person with respect to liabilities of a type described in any of clauses (a) through (h) of this definition.

The Indebtedness of any Person shall include any Indebtedness of any partnership in which such Person is the general partner.

“Insolvency”:  with respect to any Multiemployer Plan, the condition that such Plan is insolvent within the meaning of Section 4245 of ERISA.

“Insolvent”:  pertaining to a condition of Insolvency.

“Intellectual Property”:  has the meaning ascribed thereto in Section 3.9.

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“Interest Coverage Ratio”:  as of the last day of any fiscal quarter, the ratio of (a) EBITDA less Capital Expenditures to (b) gross cash interest expense, in each case determined for the Parent and its Subsidiaries on a consolidated basis for the period of four (4) consecutive fiscal quarters ending on such date.

“Interest Payment Date”:  (a) as to any Base Rate Loan, each January 1, April 1, July 1 and October 1, (b) as to any Eurodollar Loan having an Interest Period of three months or less, the last day of such Interest Period, (c) as to any Eurodollar Loan having an Interest Period longer than three months, each day which is three months, or a whole multiple thereof, after the first day of such Interest Period and the last day of such Interest Period, and (d) as to any Revolving Credit Loan, in addition to the foregoing, the Revolving Credit Termination Date.

“Interest Period”:  with respect to any Eurodollar Loan:

(a)initially the period commencing on the borrowing or conversion date, as the case may be, with respect to such Eurodollar Loan and ending one, two, three or six months thereafter, as selected by the Borrower in its notice of borrowing or notice of conversion, given with respect thereto; and

(b)thereafter, each period commencing on the last day of the next preceding Interest Period applicable to such Eurodollar Loan and ending one, two, three or six months thereafter, as selected by the Borrower by irrevocable notice to the Administrative Agent not less than three Business Days prior to the last day of the then current Interest Period with respect thereto;

provided that, the foregoing provisions relating to Interest Periods are subject to the following:

(i)if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day;

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

(iii)with respect to Eurodollar Loans that are Revolving Credit Loans, an Interest Period that otherwise would extend beyond the Revolving Credit Termination Date shall end on the Revolving Credit Termination Date; and

(iv)the Borrower shall select Interest Periods so as not to require a payment or prepayment of any Eurodollar Loan during an Interest Period for such Loan.

“Investments”:  investments (by loan or extension of credit, purchase, advance, guaranty, capital contribution or otherwise) made in cash or by delivery of Property, by any of the Parent or any Subsidiary (a) in any Person, whether by acquisition of stock or other ownership interest, indebtedness or other obligation or Security, or by loan, advance or capital contribution or (b) in any Property.

“ISP98”:  as defined in Section 2.4(a).

“Issuing Bank”:  PNC, in its capacity as issuer of Letters of Credit, and any successor thereto.

“Joinder”:  a Joinder Agreement in a form acceptable to the Administrative Agent pursuant to which a Subsidiary of the Parent shall join the applicable Loan Documents pursuant to Section 5.15, as amended, supplemented or otherwise modified from time to time.

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“Law”:  any law (including common law), constitution, statute, treaty, regulation, rule, ordinance, opinion, release, ruling, order, injunction, writ, decree or award of any Governmental Authority.

“L/C Disbursement”: a payment or disbursement made by the Issuing Bank pursuant to a Letter of Credit.

“L/C Sublimit”:  $2,000,000

“Lender”:  as defined in the Preamble hereto and any other Person that becomes a Lender hereunder by reason of an Assignment and Assumption.

“Letter of Credit Coverage Requirement”:  with respect to each Letter of Credit at any time, 102% of the maximum amount available to be drawn thereunder at such time (determined without regard to whether any conditions to drawing could be met at such time).

“Letter of Credit Fee”:  has the meaning assigned to that term in subsection 2.4(b).

“Letter of Credit Obligations”:  at any time, an amount equal to the sum of (a) 100% of the maximum amount available to be drawn under all Letters of Credit outstanding at such time (determined without regard to whether any conditions to drawing could be met at such time) and (b) the aggregate amount of drawings under Letters of Credit which have not then been reimbursed pursuant to subsection 2.4(d)(i).

“Letter of Credit Participant”:  in respect of each Letter of Credit, each Lender (other than the Issuing Bank) in its capacity as the holder of a participating interest in such Letter of Credit.

“Letters of Credit”:  collectively, the Existing Letters of Credit and any letters of credit issued by the Issuing Bank under Section 2.4, as amended, supplemented, extended or otherwise modified from time to time.

“Lien”:  any mortgage, deed of trust, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge or other security interest or any preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever (including, without limitation, any conditional sale or other title retention agreement and any capital lease having substantially the same economic effect as any of the foregoing).

“Liquidity Level”:  at any particular time, an amount equal to the sum of the Borrowing Availability and cash and Cash Equivalents maintained in Unrestricted Investment Accounts as determined for the Parentand its Subsidiaries on a consolidated basis in accordance with GAAP.

“Loan Documents”:  the collective reference to this Agreement, the Revolving Credit Notes, the Security Documents, the Applications, the Letters of Credit, the Joinders, the Fee Letter and any Subordination Agreement(s) hereinafter entered into, and all other documents, instruments, agreements or certificates delivered in connection herewith, in each case as amended, supplemented or otherwise modified.

“Loan Parties”:  the Borrower, the Parent and each of their Subsidiaries that is party to a Loan Document.

“Loans”:  as defined in Section 2.1.  Each Loan shall be either a Eurodollar Loan or a Base Rate Loan.

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“Material Adverse Effect”:  a material adverse effect on (a) the validity or enforceability of this Agreement or any other Loan Document, (b) the business, Property, assets, financial condition or results of operations of the Parent and its Subsidiaries taken as a whole, (c) the ability of the Parent and its Subsidiaries to duly and punctually to pay their debts as they come due and to perform their obligations under the Loan Documents, or (d) the ability of the Administrative Agent and the Lenders to enforce their legal remedies pursuant to this Agreement or any other Loan Document.

“Material Recovery Event”:  the receipt by the Parent or any of its Subsidiaries of property, casualty or condemnation award proceeds in excess of $1,000,000.

“Materials of Environmental Concern”:  any gasoline or petroleum (including crude oil or any fraction thereof) or petroleum products or any hazardous or toxic substances, pollutants, contamination, materials or wastes, defined or regulated as such in or under any Environmental Law, including, without limitation, asbestos, polychlorinated biphynels, and ureaformaldehyde insulation.

“Merger”:  the merger of Spirit Merger Sub with and into Salary.com under the terms of the Merger Agreement.

“Merger Agreement”: the Agreement and Plan of Merger by and among Kenexa Corporation, Spirit Merger Sub and Salary.com dated as of August 31, 2010, as it may be amended, restated or modified from time to time.

“Modified EBITDA”:  for any period of four consecutive fiscal quarters (each a “Reference Period”), EBITDA for such Reference Period; provided that, if at any time during such Reference Period, the Parent or any of its Subsidiaries shall have acquired the stock or assets of any Person in a Permitted Acquisition, then so long as (a) the Lenders shall have received audited financial statements for the prior two (2) years prepared on a GAAP basis or an independent third-party due diligence report for such Person from a nationally recognized accounting firm or other nationally recognized firm reasonably acceptable to the Administrative Agent, (b) the Person who is being acquired or who will own the assets being acquired is (or shall, upon closing of such acquisition, become) a Guarantor, unless such Person is a Foreign Subsidiary, and (c) the Borrower complies with Section 5.15 hereof, Modified EBITDA shall include (i) the historical EBITDA of such Person or attributable to such assets for the period from the beginning of such Reference Period to the day immediately preceding the closing date of such Permitted Acquisition and (ii) such adjustments to such actual EBITDA as shall be determined by the Required Lenders in their sole discretion; provided, that, if audited financial statements or third-party due diligence report have not been provided to the Lenders, (I) the historical EBITDA, if positive, of such Person or attributable to such assets shall not be included in the calculation of Modified EBITDA, unless consented to i n writing by the Required Lenders in their sole discretion and (II) the historical EBITDA, if negative, of such Person or attributable to such assets shall be included in the calculation of Modified EBITDA, unless the Required Lenders in their sole discretion elect otherwise.

“Moody’s”:  Moody’s Investors Services, Inc.

“Multiemployer Plan”:  a Plan which is a multiemployer plan as defined in Section 4001(a)(3) of ERISA and to which the Parent or its Subsidiaries, or a Commonly Controlled Entity of any of the foregoing, is making or is obligated to make contributions, or has made, or been obligated to make, contributions.

“Net Proceeds”:  (a) with respect to the sale or issuance after the Closing Date of any Capital Stock of the Parent or the incurrence of additional Indebtedness for borrowed money by the Parent or any Subsidiary thereof, the amount equal to (i) the aggregate amount received in cash in connection with such sale or issuance or incurrence minus (ii) the reasonable fees, commissions and other out-of-pocket expenses incurred by the Parent or such Subsidiary in connection with such sale or issuance or incurrence, (b) with respect to any Asset Sale, the amount equal to (i) the aggregate amount received in cash (including any cash received by way of deferred payment pursuant to a note receivable, other non-cash consideration or otherwi se, but only as and when such cash is so received) in connection with such Asset Sale minus (ii) the sum of (I) the principal amount of Indebtedness which is secured by the asset that is the subject of such Asset Sale (other than Indebtedness assumed by the purchaser of such asset) and which is required to be, and is, repaid in connection with such Asset Sale (other than Indebtedness hereunder), (II) the reasonable fees, commissions, income taxes and other out-of-pocket expenses incurred by the Parent or such Subsidiary in connection with such Asset Sale and (III) amounts established as a reserve, reasonably established by the Parent or its Subsidiaries (in accordance with GAAP), against liabilities under any indemnification obligations associated with such Asset Sale or other liabilities retained by the Parent and its Subsidiaries associated with the properties sold pursuant to such Asset Sale (provided that, to the extent and at the time such amounts are released from such reserve, such amounts shall constitute Net Proceeds), and (c) with respect to any Material Recovery Event, the amount equal to (i) the aggregate amount of the property, casualty or condemnation award proceeds received by the Parent or any Subsidiary in connection with such Material Recovery Event minus (ii) the reasonable fees and other out-of-pocket expenses incurred by the Parent and its Subsidiaries in connection with recovering such proceeds.

“Non-Loan Party”:  any Subsidiary of the Parent other than a Guarantor.  The Non-Loan Parties as of the Closing Date are (a) Kenexa Technology Canada Inc., BrassRing Canada, Inc, Kenexa BrassRing Holdings BV, Kenexa BrassRing Ltd, Kenexa BrassRing GmbH, Kenexa BrassRing Asia Pacific Ltd., Kenexa BrassRing BV, Kenexa Limited, Kenexa Technologies Private Limited, Kenexa Technologies Sdn. Bhd., Kenexa Puerto Rico Inc., Kenexa Argentina SRL, Kenexa International Limited, Kenexa SA Pte. Ltd., Centre For High Performance Development Holdings Ltd., Centre For High Performance Development USA Limited, Centre For High Performance Development Limited, Centre For High Performance Development (Singapore) Pte. Ltd., Kenexa Japan K.K., Kenexa Pty. Ltd., Ke nexa Singapore Pte. Ltd., Kenexa Servicos Em Recursos Humanos LTDA, Kenexa Testing Limited, Kenexa France, SARL, Kenexa Middle East FZ LLC, Kenexa Quorum International Holding Ltd., Quorum International Search Limited, Kenexa Quorum International Search d.o.o., Kenexa Quorum sp. Z.o.o, Kenexa Quorum International Ltd. & Co. KG, Kenexa Global Services Limited, Kenexa Munich AV GmbH, Kenexa Germany GmbH and Centre For High Performance Development, LLC, all of whom are Foreign Subsidiaries or owned by Foreign Subsidiaries and (b) the Merger Sub, provided that, after giving effect to the Merger, all Domestic Subsidiaries of the Parent shall be Guarantors and their assets shall be subject to the terms of a Security Agreement.

“Notes”:  as defined in Section 2.2.

“Notice of Borrowing”:  with respect to any Loan, a notice from the Borrower in respect of such Loan, containing the information in respect of such Loan and delivered to the Administrative Agent, in the manner and by the time specified pursuant to the terms hereof.  A form of the Notice of Borrowing is attached hereto as Exhibit B.

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“Obligations”:  collectively, (a) all Reimbursement Obligations and all unpaid principal of and accrued and unpaid interest on (including, without limitation, any interest accruing subsequent to the commencement of a bankruptcy, insolvency or similar proceeding with respect to the Borrower, whether or not such interest constitutes an allowed claim in such proceeding) the Loans, (b) all accrued and unpaid fees arising or incurred under this Agreement or any other Loan Document, (c) any other amounts due hereunder or under any of the other Loan Documents, including all reimbursements, indemnities, fees, costs, expenses, prepayment premiums, break-funding costs and other obligations of the Borrower or any other Loan Party to the Administrat ive Agent, any Lender or any indemnified party hereunder or thereunder, (d) any obligations owed by the Borrower or any other Loan Party to any Lender or to any Affiliate of any Lender pursuant to a Hedge Agreement, and (e) all out-of-pocket costs and expenses incurred by the Administrative Agent and the Lenders in connection with this Agreement and the other Loan Documents, including but not limited to the reasonable fees and expenses of the Administrative Agent’s counsel and each Lender’s counsel, which the Borrower is responsible to pay pursuant to the terms of this Agreement and/or the other Loan Documents.

“Participant”:  as defined in subsection 9.6(f).

“Parent”:  Kenexa Corporation, a Pennsylvania corporation.

“PBGC”:  the Pension Benefit Guaranty Corporation established pursuant to Subtitle A of Title IV of ERISA, or any Governmental Authority succeeding to the function thereof.

“Permitted Acquisition”: (a) the Merger, (b) the Tender Offer, and (c) subject to compliance with Section 6.6, an acquisition by the Parent or any Subsidiary thereof (whether by merger, consolidation, reorganization or purchase of assets or stock or other ownership interests) of any Person engaged in a business that a Subsidiary of the Parent is permitted to engage in pursuant to Section 6.10 that is not hostile in nature; provided, that, at the time that any definitive agreement is entered into in respect of such acquisition (or immediately prior to the closing of such agr eement if such agreement contains a contingency for any approval required under this Agreement with respect to such acquisition), no Default or Event of Default shall exist or would exist if such acquisition were consummated on such date (assuming for purposes of the covenants contained in Section 6.1, that pro forma adjustments are made to the consolidated financial statements of the Parent and its Subsidiaries in accordance with the terms hereof reflecting such acquisition based on the historical audited financial statements (on a GAAP basis) or independent third party due diligence report and other information of such Person received by the Administrative Agent prior to the consummation of such acquisition), provided further, that approval of the Required Lenders shall be required for any such acquisition if (i) at the time of and after giving effect to such acquisition, t he Liquidity Level would be less than $5,000,000 or (ii) the Total Leverage Ratio calculated as of the end of the immediately preceding fiscal quarter for which financial statements have been delivered to the Lenders on a pro forma basis (i.e., after giving effect to such Permitted Acquisition and the borrowing of any Indebtedness in connection therewith as if consummated on the last day of such fiscal quarter) would exceed 1.75 to 1.0.

“Permitted Investments”:  Investments in:

(a)one or more Subsidiaries of the Parent; provided that the aggregate amount of net Investments made by the Parent and the other Loan Parties in Non-Loan Parties shall not exceed $10,000,000 in the aggregate for the period from and after the Closing Date, including, in each case any Investments made after the Closing Date in Non-Loan Parties pursuant to any other provisions of this definition including clause (p) below (measured, with respect to any Permitted Acquisition involving the assets or stock of a Non-Loan Party, as the purchase price for such assets or stock as reasonably determined by the Bor rower);

(b)Property to be used in the ordinary course of business of a Subsidiary of the Parent;

(c)current assets arising from the sale or purchase of goods and services in the ordinary course of business of a Subsidiary of the Parent;

(d)direct obligations of the United States of America or any agency or instrumentality thereof, or obligations guaranteed by the United States of America or any agency or instrumentality thereof, provided that such obligations mature within one (1) year from the date of acquisition thereof;

(e)certificates of deposit, time deposits or banker’s acceptances, maturing within one (1) year from the date of acquisition, with banks or trust companies organized under the laws of the United States, the unsecured long-term debt obligations of which are rated “A3” or higher by Moody’s or “A-” or higher by S&P, and issued, or in the case of banker’s acceptance, accepted, by a bank or trust company having capital, surplus and undivided profits aggregating at least $500,000,000;

(f)commercial paper given the highest rating by either S&P or Moody’s maturing not more than 270 days from the date of creation thereof;

(g)in “money market funds” within the meaning of Rule 2a-7 of the Investment Company Act of 1940, as amended;

(h)in other short-term Investments utilized by Foreign Subsidiaries in accordance with normal investment practices for cash management in Investments of a type analogous to the foregoing clauses (d) through (g);

(i)received in connection with the bankruptcy or reorganization of, or settlement of delinquent accounts and disputes with, customers and suppliers, in each case, in the ordinary course of business;

(j)in connection with Hedge Agreements that are permitted pursuant to Section 6.2 hereof;

(k)Investments in connection with any cash management agreements with PNC;

(l)trade credit extended on usual and customary terms in the ordinary course of business;

(m)loans to shareholders, directors or officers in an aggregate amount not to exceed $500,000 at any one time outstanding;

(n)advances to employees to meet expenses incurred by such employees in the ordinary course of business in an aggregate amount not to exceed $500,000at any one time outstanding;

(o)Investments existing on the date hereof and set forth on Schedule IV hereto;

(p)Permitted Acquisitions;

(q)Loans from Parent and its Subsidiaries to Spirit Merger Sub to allow it to consummate the Tender Offer and the Merger; and

(r)Investments not otherwise provided in clauses (a) through (q) above in an aggregate amount not to exceed $250,000 outstanding at any one time.

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“Permitted Liens”:  as defined in Section 6.3.

“Person”:  an individual, partnership, corporation, limited liability company, limited liability partnership, business trust, joint stock company, trust, unincorporated association, joint venture, Governmental Authority or other entity of whatever nature.

“Plan”:  at a particular time, any employee benefit plan which is covered by ERISA and in respect of which the Parent, any Subsidiary or a Commonly Controlled Entity is (or, if such plan were terminated at such time, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.

“Pledge Agreement”:  (a) the Pledge Agreement or Agreements, dated as of the date hereof, to be executed and delivered on the Closing Date and (b) any other Pledge Agreement between a Loan Party and the Administrative Agent, each substantially in the form of Exhibit E hereto, as amended, supplemented or otherwise modified from time to time.

“PNC”:  PNC Bank, National Association.

“Prime Rate”:  the rate of interest per annum publicly announced from time to time by PNC as its prime rate in effect at its principal office in Philadelphia, Pennsylvania, which rate may not be the lowest rate then being charged to commercial borrowers by PNC; each change in the Prime Rate shall be effective on the date such change is publicly announced as effective.

“Properties”:  the collective reference to the facilities and properties owned, leased or operated by the Parent and its Subsidiaries.

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

“Purchasing Lender”:  as defined in subsection 9.6(b).

“Register”:  as defined in subsection 9.6(d).

“Regulations D, T, U and X”:  Regulations D, T, U and X promulgated by the Board of Governors of the Federal Reserve System (12 C.F.R. Part 204 etseq., 12 C.F.R. part 220 etseq., 12 C.F.R. Part 221 etseq. and 12 C.F.R. Part 224 etseq., respec tively), as such regulations are now in effect and as may hereafter be amended.

“Reimbursement Obligations”:  in respect of each Letter of Credit, the obligation of the Borrower to reimburse the Issuing Bank for all drawings made thereunder in accordance with subsection 2.4(d) and the Application related to such Letter of Credit for amounts drawn under such Letter of Credit.

“Reorganization”:  with respect to any Multiemployer Plan, the condition that such plan is in reorganization within the meaning of Section 4241 of ERISA.

“Reportable Event”:  any of the events set forth in Section 4043(c)(1), (2), (4), (5), (6), (10) and (13) of ERISA.

“Required Lenders”:  at any time, such Lenders as hold, individually or collectively, at least (a) 66 2/3% of the Revolving Credit Commitments, or (b) in the event that the Revolving Credit Commitments have expired or terminated, 66 2/3% of the Revolving Credit Exposure of all of the Lenders at such time.

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“Requirement of Law”:  as to any Person, the Articles or Certificate of Incorporation or Formation, By-Laws, partnership agreement, operating agreement or other organizational or governing documents of such Person, and any law, treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case binding upon such Person or any of its property or to which such Person or any of its property is subject.

“Responsible Officer”:  with respect to any Person, the chief executive officer, president, chief or principal financial officer or controller of such Person.  Unless otherwise qualified, all references to a “Responsible Officer” in this Agreement shall refer to a Responsible Officer of the Borrower.

“Revolving Credit Commitment”:  with respect to each Revolving Credit Lender, the commitment of such Lender to make Revolving Credit Loans and/or participate in Letters of Credit in the aggregate amount not to exceed at any one time outstanding:  (a) as to any Revolving Credit Lender which is an original signatory to this Agreement, the amount set forth opposite such Lender’s name on Schedule I hereto under the caption “Revolving Credit Loans,” as such amount may be increased or decreased from time to time in accordance with the provisions of this Agreement, or (b) as to any Revolving Credit Lender which is not an original signatory to this Agree ment but which becomes a Revolving Credit Lender by executing an Assignment and Assumption, the Revolving Credit Commitment for such Lender set forth on Schedule I to such Assignment and Assumption, as such amount may be increased or decreased from time to time in accordance with the provisions of this Agreement.  The aggregate amount of the Revolving Credit Commitments on the Closing Date is $25,000,000.

“Revolving Credit Commitment Percentage”:  as to any Revolving Credit Lender at any time, the percentage which such Lender’s Revolving Credit Commitment then constitutes of the aggregate Revolving Credit Commitments of all of the Revolving Credit Lenders at such time (or, at any time after the Revolving Credit Commitments shall have expired or been terminated, the percentage which such Lender’s Revolving Credit Exposure constitutes of the Revolving Credit Exposure of all of the Revolving Credit Lenders at such time).

“Revolving Credit Commitment Period”:  the period from and including the Closing Date to, but not including, the Revolving Credit Termination Date, or such earlier date on which the Revolving Credit Commitments shall terminate in their entirety as provided herein.

“Revolving Credit Exposure”:  as to any Revolving Credit Lender at any time, the sum of (a) the aggregate principal amount of all Revolving Credit Loans made by such Lender then outstanding and (b) such Lender’s Revolving Credit Commitment Percentage multiplied by the aggregate Letter of Credit Obligations at such time.

“Revolving Credit Lender”:  as defined in the Preamble hereto and any other Person that becomes a Lender hereunder by reason of an Assignment and Assumption.

“Revolving Credit Loans”:  as defined in Section 2.1.

“Revolving Credit Note”:  as defined in Section 2.2.

“Revolving Credit Termination Date”:  the earlier of (a) August 30, 2013 and (b) the date the Revolving Credit Commitments are terminated in their entirety as provided herein.

“Salary.com”:  Salary.com, Inc., a Delaware corporation.

“SEC”:  the Securities and Exchange Commission or any successor governmental agency thereof.

“S&P”:  Standard & Poor’s Rating Group, a division of McGraw-Hill Corporation.

“Security”:  “security” as defined in Section 2(1) of the Securities Act of 1933, as amended.

“Security Agreement”:  (a) the Security Agreement entered into on the Closing Date among the Borrower, the Guarantors as of such date and the Administrative Agent for the benefit of the secured parties thereunder (including the Lenders) and (b) any other Security Agreement entered into by a Guarantor and the Administrative Agent, in each case substantially in the form of Exhibit F hereto, as the same may be amended, supplemented or otherwise modified from time to time.

“Security Documents”:  collectively, any and all of (a) the Security Agreement(s), (b) the Guaranty(ies), (c) the Pledge Agreement(s) and (d) all additional documents and instruments entered into from time to time for the purpose of securing the Obligations, as the foregoing may be amended, supplemented or otherwise modified from time to time.

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“Solvent”:  as to any Person, as of the time of determination, the financial condition under which the following conditions are satisfied:

(a)the fair market value of the assets of such Person will exceed the debts and liabilities, subordinated, contingent or otherwise, of such Person;

(b)the present fair saleable value of the Property of such Person will be greater than the amount that will be required to pay the probable liability of such Person on its debts and other liabilities, subordinated, contingent or otherwise, as such debts and other liabilities become absolute and matured;

(c)such Person intends and will be able to pay its debts and liabilities, subordinated, contingent or otherwise, as such debts and liabilities become absolute and matured; and

(d)such Person will not have unreasonably small capital with which to conduct the business in which it is engaged as such business is then conducted and is proposed to be conducted after the date thereof.

“Spirit Merger Sub”:  Spirit Merger Sub, Inc., a Delaware corporation and a direct Subsidiary of the Parent.

“Spirit Rights Agreement”:  the Rights Agreement between Salary.com and American Stock Transfer & Trust Company, LLC, dated as of November 14, 2008, as it may be amended, supplemented or otherwise modified from time to time.

“Subordinated Debt”:  Indebtedness of a Subsidiary of the Parent which is subordinated to the Obligations in a manner satisfactory to the Administrative Agent, including that (a) no portion of the principal of such Indebtedness shall be payable prior to ninety (90) days after the Revolving Credit Termination Date, (b) such Indebtedness shall be unsecured and (c) the subordinated creditor(s) shall be subject to a standstill period of at least one hundred eighty (180) days with respect to the exercise of its remedies following the occurrence of an Event of Default.

“Subsidiary”:  as to any Person, a corporation, partnership, limited liability company or other entity of which shares of stock or other ownership interests having ordinary voting power (other than stock or such other ownership interests having such power only by reason of the happening of a contingency) to elect a majority of the board of directors or other managers of such corporation, partnership, limited liability company or other entity are at the time owned, or the management of which is otherwise controlled, directly or indirectly through one or more intermediaries, or both, by such Person.  Unless otherwise qualified, all references to a “Subsidiary” or to “Subsidiaries” in this Agreement shall refer to a Subsi diary or Subsidiaries of the Parent.

“Taxes”:  as defined in Section 2.13.

“Tender Offer”:  the tender offer by Spirit Merger Sub to purchase all of Salary.com’s stock, par value $0.0001 per share, including the associated preferred stock purchase rights under the Spirit Rights Agreement at a price per share of $4.07, net to the holder in cash without interest, subject to any tax withholding.

“Total Debt”:  at any time, all Indebtedness of the Parent and its Subsidiaries at such time determined on a consolidated basis in accordance with GAAP and without duplication.

“Total Leverage Ratio”:  as of the last day of any fiscal quarter, the ratio of (a) Total Debt at such date to (b) Modified EBITDA for the period of four (4) consecutive fiscal quarters ending on such date.

“Tranche”:  the collective reference to (a) Eurodollar Loans whose Interest Periods begin on the same date and end on the same later date (whether or not such Loans originally were made on the same date) and (b) Base Rate Loans.

“Type”:  when used in respect of any Loan or Borrowing, shall refer to the Rate by reference to which interest on such Loan or on the Loans comprising such Borrowing is determined.  For purposes hereof, “Rate” shall include the Eurodollar Rate and the Base Rate.

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“Unrestricted Investment Account”:  each investment account maintained by the Parent and/or a Subsidiary thereof at a Lender or Affiliate thereof and which has been designated by the Borrower and accepted by the Administrative Agent as an “Unrestricted Investment Account.”  For the avoidance of doubt, an operating account shall not constitute an Unrestricted Investment Account.

“Unused Revolving Credit Commitment”:  as to any Lender at any particular time during the Revolving Credit Commitment Period, an amount equal to the excess, if any, of the Revolving Credit Commitment of such Lender at such time over the Revolving Credit Exposure of such Lender at such time.

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

“Withdrawal Liability”:  any withdrawal liability as defined in Section 4201 of ERISA.

1.2Other Definitional Provisions

.  (a)  Unless otherwise specified therein, all terms defined in this Agreement shall have the defined meanings when used in the Notes, the other Loan Documents or any certificate or other document made or delivered pursuant hereto or thereto.  Except as otherwise provided in this Agreement, all computations and determinations as to accounting or financial matters and all financial statements to be delivered pursuant to this Agreement shall be made and prepared in accordance with GAAP (including principals of consolidation where appropriate).  As used herein and in the Notes and the other Loan Documents, and any certificate or other document made or delivered pursuant hereto or thereto, accounting terms relating to the Parent and its Subsidiaries not defined in Section 1.1 and accounting terms partl y defined in Section 1.1, to the extent not defined, shall have the respective meanings given to them under GAAP.

(b)The words “hereof”, “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and Section, Subsection, Schedule and Exhibit references are to this Agreement unless otherwise specified.

(c)The meanings given to terms defined in this Agreement shall be equally applicable to both the singular and plural forms of such terms.

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SECTION 2.  LOANS AND TERMS OF COMMITMENTS

2.1Revolving Credit Commitments

.  Subject to the terms and conditions hereof, each Revolving Credit Lender severally agrees to make revolving credit loans (the “Loans” or the “Revolving Credit Loans”) to the Borrower from time to time during the Revolving Credit Commitment Period in an aggregate principal amount at any one time outstanding not to exceed the amount of such Lender’s Revolving Credit Commitment minus the sum of such Lender’s Revolving Credit Commitment Percentage of all Letter of Credit Obligations then outstanding; provided that no Revolving Credit Loan shall be made if, after giving effect thereto and the simultaneous application of the proceeds thereof, the Revolving Credit Expos ure of all Revolving Credit Lenders would exceed the Revolving Credit Commitments of all Revolving Credit Lenders at such time.  If at any time the aggregate Revolving Credit Exposure of all of the Revolving Credit Lenders exceeds the Revolving Credit Commitments of all of the Revolving Credit Lenders at such time, the Borrower shall promptly prepay the excess to the Administrative Agent, to be applied first to repay the Revolving Credit Loans and then as cash collateral to secure the Letter of Credit Obligations.  Unless otherwise directed by the Borrower, payments on Revolving Credit Loans pursuant to the preceding sentence shall be applied first to Base Rate Loans and then to Eurodollar Loans in the direct order of maturity.  The Revolving Credit Commitments may be reduced or terminated from time to time pursuant to Section 2.9.  Within the foregoing limits, the Borrower may during the Revolving Credit Commitment Period borrow, repay and reborrow from time to time u nder the Revolving Credit Commitments, subject to and in accordance with the terms and limitations hereof.  The failure of any Revolving Credit Lender to perform its obligations hereunder shall not relieve any other Revolving Credit Lender of its obligations hereunder (it being understood, however, that no Revolving Credit Lender shall be responsible for the failure of any other Revolving Credit Lender to make any Revolving Credit Loan required to be made by such other Revolving Credit Lender).  Each Revolving Credit Loan shall be made in accordance with the procedures set forth in Section 2.3.

2.2Revolving Credit Notes

.  The Revolving Credit Loans made by each Revolving Credit Lender shall be evidenced by a promissory note of the Borrower, substantially in the form of Exhibit A-1 hereto, with appropriate insertions as to payee, date and principal amount (as each may be amended, supplemented or otherwise modified, a “Note” or “Revolving Credit Note”), payable to the order of such Revolving Credit Lender and in a principal amount equal to the amount of the initial Revolving Credit Commitment of such Revolving Credit Lender.  Each Revolving Credit Lender is hereby authorized to record the date, Type, and amount of each Revolving Credit Loan made by such Revolving Credit Lender, a nd the date and amount of each payment or prepayment of principal thereof, on the schedule annexed to and constituting a part of its Revolving Credit Note, provided that the failure of any Revolving Credit Lender to make such recordation (or any error in such recordation) shall not affect the obligations of the Borrower hereunder or under such Revolving Credit Note.  Each Revolving Credit Note shall (a) be dated the Closing Date, (b) be stated to mature on the Revolving Credit Termination Date and (c) provide for the payment of interest in accordance with Sections 2.5 and 2.6.

2.3Procedure for Revolving Credit Loans

.  The Borrower may borrow under the Revolving Credit Commitments from time to time during the Revolving Credit Commitment Period on any Business Day.  The Borrower shall give the Administrative Agent a Notice of Borrowing (a) in the case of a Eurodollar Borrowing, not later than 10:30 a.m., Philadelphia time, three (3) Business Days before such proposed Borrowing and (b) in the case of a Base Rate Borrowing, not later than 10:30 a.m., Philadelphia time, on the day of such proposed Borrowing.  All Loans borrowed on the Closing Date shall initially be Base Rate Loans, provided that such Loans can be converted thereafter to Eurodollar Loans in accordance with the terms hereof.  Such Notice of Borrowing shall be irrevocable and shall in each case specify (a) the date of such Borrowi ng (which shall be a Business Day) and the amount thereof; and (b) if such Borrowing is to be a Eurodollar Borrowing, the Interest Period with respect thereto.  If no election as to the Type of Borrowing is specified in any such notice, then the requested Borrowing shall be a Base Rate Borrowing.  If no Interest Period with respect to any Eurodollar Borrowing is specified in any such notice, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration.  Each borrowing under the Revolving Credit Commitments shall be in a minimum amount equal to (x) with respect to Eurodollar Borrowings, $500,000 or in integral multiples of $500,000 in excess thereof and (y) with respect to Base Rate Borrowings, $500,000 or in integral multiples of $100,000 in excess thereof (or, with respect to Base Rate Borrowings, if the aggregate Unused Revolving Credit Commitments at such time are less than $500,000, such lesser amount, as applicable).

Upon receipt of a Notice of Borrowing from the Borrower, the Administrative Agent shall promptly notify each Revolving Credit Lender of such request.  Each Revolving Credit Lender will make the amount of its prorata share of such Borrowing (based on its Revolving Credit Commitment Percentage at that time) available to the Administrative Agent for the account of the Borrower at the office of the Administrative Agent specified in Section 9.2 prior to 2:00 p.m., Philadelphia time, on the Borrowing Date requested by the Borrower in funds immediately available to the Administrative Agent.  Such Borrowing will then be made available to the Borrower by the Administrative Agent crediting the a ccount of the Borrower on the books of the Administrative Agent with the aggregate of the amounts made available to the Administrative Agent by the Lenders and in like funds as received by the Administrative Agent.

Unless the Administrative Agent shall have received notice from a Revolving Credit Lender prior to the date of any borrowing of Revolving Credit Loans that such Revolving Credit Lender will not make available to the Administrative Agent such Revolving Credit Lender’s prorata portion of such Borrowing, the Administrative Agent may assume that such Revolving Credit Lender has made such portion available to the Administrative Agent on the date of such borrowing in accordance with this subsection and the Administrative Agent may, in reliance upon such assumption, make available to the Borrower on such date a corresponding amount.  If and to the extent that such Revolving Credit Lender shall not hav e made such portion available to the Administrative Agent, such Revolving Credit Lender and the Borrower (without prejudice to the Borrower’s rights against such Revolving Credit Lender) severally agree to repay to the Administrative Agent forthwith on demand such corresponding amount together with interest thereon, for each day from the date such amount is made available to the Borrower until the date such amount is repaid to the Administrative Agent at (i) in the case of the Borrower, the interest rate applicable at the time to the Revolving Credit Loans comprising such Borrowing and (ii) in the case of such Revolving Credit Lender, the Federal Funds Effective Rate, provided, that, if such Lender shall not pay such amount within three (3) Business Days of such Borrowing Date, the interest rate on such overdue amount shall, at the expiration of such three-Business Day period, be the rate per annum applicable to the Revolving Credit Loans comprising such Borrowing.  If such Lender shall repay to the Administrative Agent such corresponding amount, such amount shall constitute such Lender’s Revolving Credit Loan as part of such Borrowing for purposes of this Agreement.

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2.4Letter of Credit Subfacility.

(a)During the Revolving Credit Commitment Period, the Borrower may request the issuance of standby Letters of Credit to support obligations of a Subsidiary of the Parent which finance the working capital and business needs of a Subsidiary of the Parent by delivering to the Issuing Bank a completed Application for letters of credit in such form and with such other certificates, documents and information as the Issuing Bank may specify from time to time by no later than 12:00 noon, Philadelphia time, at least five (5) Business Days (or such shorter period as may be agreed to by the Issuing Bank) in advance of the proposed date of issuance.  Each Application for issuance of a Letter of Credit shall be accompanied by an issuance fee based upon the Issuing Bank’s standard schedule of fees charged for issuing letters of credit as such may be amended from time to time.  Subject to the terms and conditions hereof and in reliance on the agreements of the other Revolving Credit Lenders set forth in this Section, the Issuing Bank will issue a Letter of Credit, provided, that each Letter of Credit shall (i) have a maximum maturity of twelve (12) months from the date of issuance, and (ii) in no event expire later than five (5) Business Days prior to the Revolving Credit Termination Date, and provided further, that in no event shall the amount of the Letter of Credit Obligations at any one time exceed the lesser of (i) the L/C Sublimit and (ii) the aggregate Revolving Credit Commitments minus the aggregate principal amount of the Revolving Credit Loans then outstanding.  The Issuing Bank shall not at any time be obligated to issue any Letter of Credit hereunder if such issuance would conflict with, or cause the Issuing Bank or any Letter of Credit Participant to exceed, any limits imposed by any applicable Requirement of Law.  Notwithstanding the provisions of this Section, the Revolving Credit Lenders and the Borrower hereby agree that the Issuing Bank may issue upon the Borrower’s request, one or more Letter(s) of Credit which by its or their terms may be extended for additional periods of up to one year each provided that (I) the initial expiration date (or any subsequent expiration date) of each such Letter of Credit is not later than five (5) Business Days prior to the Revolving Credit Termination Date, and (II) renewal of such Letter(s) of Credit, at the Issuing Bank’s discretion, shall be available upon written request from the Borrower to the Issuing Bank at least thirty (30) days (or such other time period as agreed by the Borrower and the Issuing Bank) before the date upon which notice of renewal is otherwise required.  Each standby Letter of Credit shall be subject either to the Uniform Customs and Practice for Documentary Credits as most recently published by the International Chamber of Commerce at the time a Letter of Credit is issued (“UCP”) or the International Standby Practices (ISP98 International Chamber of Commerce Publication Number 590 (“ISP98”)), as determined by the Issuing Bank.

(b)The Borrower shall pay to the Administrative Agent for the ratable account of the Revolving Credit Lenders a fee (the “Letter of Credit Fee”) equal to the amount of the Applicable Margin for Revolving Credit Loans that are Eurodollar Loans in effect from time to time multiplied by the daily average of the undrawn face amount of each Letter of Credit during the preceding fiscal quarter (or shorter period commencing with the Closing Date or ending on the Revolving Credit Termination Date), and shall be payable quarterly in arrears on each January 1, April 1, July 1 and October 1 commencing with October 1, 2010 and on the Revolving Cred it Termination Date.  The Borrower shall also pay to the Issuing Bank the Issuing Bank’s then in effect customary fees, plus a fronting fee of twelve and one-half basis points (.125%) on the face amount of each such Letter of Credit, and administrative expenses payable with respect to each Letter of Credit issued or renewed by it as the Issuing Bank may generally charge from time to time; provided that, no fronting fee shall be payable for any period in which there is only one Lender.  Once paid, all of the above fees shall be nonrefundable under all circumstances.  All periodic interest, fees and commissions shall be calculated on the basis of the actual days elapsed in a 360 day year.

(c)(i) The Issuing Bank irrevocably agrees to grant and hereby grants to each Letter of Credit Participant, and, to induce the Issuing Bank to issue Letters of Credit hereunder, each Revolving Credit Lender irrevocably agrees to accept and purchase and hereby accepts and purchases from the Issuing Bank, on the terms and conditions hereinafter stated, for such Letter of Credit Participant’s own account and risk, an undivided interest equal to such Letter of Credit Participant’s Revolving Credit Commitment Percentage in the Issuing Bank’s obligations and rights under each Letter of Credit issued by the Issuing Bank (including the Existing Letters of Credit) and the amount of each draft paid by the Issuing Bank thereunder.  Each Letter of Credit Participant unconditionally and irrevocably agrees with the Issuing Bank that, if a draft is paid under any Letter of Credit issued by the Issuing Bank for which the Issuing Bank is not reimbursed in full by the Borrower in accordance with the terms of this Agreement, such Letter of Credit Participant shall pay to the Issuing Bank upon demand at the Issuing Bank’s address for notices specified herein an amount equal to such Letter of Credit Participant’s share (based on its Revolving Credit Commitment Percentage) of (x) the amount of such draft or any part thereof, which is not so reimbursed and (y) any taxes, fees, charges or other costs or expenses incurred by the Issuing Bank in connection with such payment.  Any action taken or omitted by the Issuing Bank under or in connection with a Letter of Credit, if taken or omitted in the absence of gross negligence or willful misconduct, shall not create for the Issuing Bank any resultin g liability to any Lender.

(ii)If any amount required to be paid by any Letter of Credit Participant to the Issuing Bank pursuant to subsection 2.4(c)(i) in respect of any unreimbursed portion of any payment made by the Issuing Bank under any Letter of Credit is not paid to the Issuing Bank on the date such payment is due from such Letter of Credit Participant, such Letter of Credit Participant shall pay to the Issuing Bank on demand an amount equal to the product of (x) such amount, times (y) the daily average Federal Funds Effective Rate, as quoted by the Issuing Bank, during the period from and including the date such payment is required to the date on which such payment is immediately available to the Issuing Bank, times (z) a fraction the numerator of which is the number of days that elapse during such period and the denominator of which is 360.  A certificate of the Issuing Bank submitted to any Letter of Credit Participant with respect to any amounts owing under this subsection shall be conclusive in the absence of manifest error.

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(iii)Whenever, at any time after the Issuing Bank has made payment under any Letter of Credit and has received from any Letter of Credit Participant its prorata share of such payment in accordance with subsection 2.4(c)(i), the Issuing Bank receives any payment related to such Letter of Credit (whether directly from the Borrower or otherwise, including by way of set-off or proceeds of collateral applied thereto by the Issuing Bank), or any payment of interest on account thereof, the Issuing Bank will distribute to such Letter of Credit Participant its prorata share thereof; provided, however, that in the event that any such payment received by the Issuing Bank shall be required to be returned by the Issuing Bank, such Letter of Credit Participant shall return to the Issuing Bank the portion thereof previously distributed by the Issuing Bank to it.

(d)(i)  The Borrower agrees to reimburse the Issuing Bank in respect of a Letter of Credit (including an Existing Letter of Credit) on each date on which a draft presented under such Letter of Credit is paid by the Issuing Bank for the amount of (a) such draft so paid and (b) any taxes, fees, charges or other costs or expenses incurred by the Issuing Bank in connection with such payment.  Each such payment shall be made to the Issuing Bank in immediately available funds.  Notwithstanding any other provisions of this Agreement, unless other acceptable arrangements for the immediate reimbursement by the Borrower of amounts required to be advanced by the Issuing Bank pursuant to a Letter of Cred it have been made by the Borrower and the Issuing Bank and such reimbursement is made by the Borrower, any and all amounts which the Issuing Bank is required to advance pursuant to a Letter of Credit shall, at the option of the Issuing Bank, become, at the time the amounts are advanced, Revolving Credit Loans from the Revolving Credit Lenders made as a Base Rate Borrowing.  The Administrative Agent will notify the Revolving Credit Lenders of the amount required to be advanced pursuant to the Letters of Credit.  Before 10:00 A.M. (Philadelphia time) on the date of any advance the Revolving Credit Lenders are required to make pursuant to the Letters of Credit, each Revolving Credit Lender shall make available to the Administrative Agent such Revolving Credit Lender’s Revolving Credit Commitment Percentage of such advance in immediately available funds.

(ii)Interest shall be payable on any and all amounts remaining unpaid by the Borrower under this subsection from the date such amounts become payable (whether at stated maturity, by acceleration or otherwise) until payment in full at the per annum rate of the then applicable Default Rate for Revolving Credit Loans which are Base Rate Loans and shall be payable on demand by the Issuing Bank.

(e)(i)   The Borrower also agrees with the Issuing Bank that the Issuing Bank shall not be responsible for, and the Borrower’s Reimbursement Obligations under subsection 2.4(d)(i) shall not be affected by, among other things (x) the validity or genuineness of documents or of any endorsements thereon, even though such documents shall in fact prove to be invalid, fraudulent or forged, provided, that reliance upon such documents by the Issuing Bank shall not have constituted gross negligence or willful misconduct of the Issuing Bank or (y) any dispute between or among the Borrower and any beneficiary of any Letter of Credit or any other par ty to which such Letter of Credit may be transferred or (z) any claims whatsoever of the Borrower against any beneficiary of such Letter of Credit or any such transferee.

(ii)The Issuing Bank shall not be liable for any error, omission, interruption or delay in transmission, dispatch or delivery of any message or advice, however transmitted, in connection with any Letter of Credit, except for errors or omissions caused by the Issuing Bank’s gross negligence or willful misconduct.

(iii)The Borrower agrees that any action taken or omitted by the Issuing Bank under or in connection with any Letter of Credit or the related drafts or documents, if done in the absence of gross negligence or willful misconduct, shall be binding on the Borrower and shall not result in any liability of the Issuing Bank to the Borrower.

(f)If any draft shall be presented for payment to the Issuing Bank under any Letter of Credit, the Issuing Bank shall promptly notify the Borrower of the date and amount thereof.  The responsibility of the Issuing Bank to the Borrower in connection with any draft presented for payment under any Letter of Credit shall, in addition to any payment obligation expressly provided for in such Letter of Credit and any other obligation expressly imposed by the UCP or ISP98 as applicable to such Letter or Credit, be limited to determining that the documents (including each draft) delivered under such Letter of Credit in connection with such presentment are in conformity with such Letter of Credit.

(g)To the extent that any provision of any Application related to any Letter of Credit is inconsistent with the provisions of this Agreement, the provisions of this Agreement shall govern.

(h)Subject to subsection 2.4(g) above, the Borrower agrees to be bound by the terms of each Application and the Issuing Bank’s written regulations and customary practices relating to letters of credit, though such interpretation may be different from the Borrower’s own.  It is understood and agreed that, except in the case of gross negligence or willful misconduct, the Issuing Bank shall not be liable for any error, negligence and/or mistakes, whether of omission or commission, in following the Borrower’s instructions or those contained in the Letters of Credit or any modifications, amendments or supplements thereto.

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(i)Each Revolving Credit Lender’s payment obligation under subsection 2.4(c) and the Reimbursement Obligations shall be absolute, unconditional and irrevocable under any circumstances, and shall be performed strictly in accordance with the terms of this Section 2.4 under all circumstances, including the following circumstances:

                                                                (i)any set-off, counterclaim, recoupment, defense or other right which such Revolving Credit Lender may have against the Issuing Bank, any Loan Party or any other Person for any reason whatsoever;

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

                                                                (iii)the existence of any claim, set-off, defense or other right which any Loan Party or any Revolving Credit Lender may have at any time against a beneficiary or any transferee of any Letter of Credit (or any Persons for whom any such transferee may be acting), the Issuing Bank or any Revolving Credit Lender or any other Person, whether in connection with this Agreement, the transactions contemplated herein or any unrelated transaction (including any underlying transaction between any Loan Party and the beneficiary for which any Letter of Credit was procured);

                                                                (iv)any draft, demand, certificate or other document presented under any Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect even if the Issuing Bank has been notified thereof;

                                                                (v)payment by the Issuing Bank under any Letter of Credit against presentation of a demand, draft or certificate or other document which does not comply with the terms of such Letter of Credit, provided that such payment shall not have constituted gross negligence or willful misconduct on the part of the Issuing Bank;

                                                               (vi)any adverse change in the business, operations, properties, assets, condition (financial or otherwise) or prospects of the Parent and its Subsidiaries;

(vii)any breach of this Agreement or any other Loan Document by any Loan Party;

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

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

                 (x)the fact that the Revolving Credit Termination Date shall have passed or this Agreement or the Revolving Credit Commitments hereunder shall have been terminated; and

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

(j)In addition to amounts payable as provided in Section 9.5, the Borrower hereby agrees to protect, indemnify, pay and save harmless the Issuing Bank, the Administrative Agent and the Lenders from and against any and all claims, demands, liabilities, damages, losses, costs, charges and expenses (including reasonable fees, expenses and disbursements of counsel) which the Issuing Bank or the Lenders may incur or be subject to as a consequence, direct or indirect, of (i) the issuance of any Letter of Credit, other than as a result of (A) the gross negligence or willful misconduct of the Issuing Bank as determined by a final judgment of a court of competent jurisdiction or (B) subject to the following clause (ii), the wrongful dishonor by the Issuing Bank of a proper demand for payment made under any Letter of Credit, or (ii) the failure of the Issuing Bank to honor a drawing under any such Letter of Credit as a result of any act or omission, whether rightful or wrongful, of any present or future de jure or de facto government or governmental authority (all such acts or omissions herein called “Governmental Acts”).

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(k)As among the Borrower and the Issuing Bank, the Borrower assumes all risks of the acts and omissions of, or misuse of the Letters of Credit by, the respective beneficiaries of such Letters of Credit.  In furtherance and not in limitation of the foregoing, the Issuing Bank shall not be responsible for:  (i) the form, validity, sufficiency, accuracy, genuineness or legal effect of any document submitted by any party in connection with the application for an issuance of or drawing under any such Letter of Credit, even if it should in fact prove to be in any or all respects invalid, insufficient, inaccurate, fraudulent or forged (even if the Issuing Bank shall have been notified thereof); (ii) the valid ity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign any such Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason; (iii) the failure of the beneficiary of any such Letter of Credit, or any other party to which such Letter of Credit may be transferred, to comply fully with any conditions required in order to draw upon such Letter of Credit or any other claim of any Loan Party against any beneficiary of such Letter of Credit, or any such transferee, or any dispute between or among any Loan Party and any beneficiary of any Letter of Credit or any such transferee; (iv) errors, omissions, interruptions or delays in transmission or delivery of any messages, by mail, facsimile, cable, telex or otherwise; (v) errors in interpretation of technical terms; (vi) any loss or delay in the transmission or otherwise of any document required in order to make a drawing under any such Letter of Credit or of the proceeds thereof; (vii) the misapplication by the beneficiary of any such Letter of Credit of the proceeds of any drawing under such Letter of Credit; or (viii) any consequences arising from causes beyond the control of the Issuing Bank, including any Governmental Acts, and none of the above shall affect or impair, or prevent the vesting of, any of the Issuing Bank’s rights or powers hereunder.

In furtherance and extension and not in limitation of the specific provisions set forth above, any action taken or omitted by the Issuing Bank under or in connection with the Letters of Credit issued by it or any documents and certificates delivered thereunder, if taken or omitted in good faith, shall not create any liability of the Issuing Bank to the Borrower or any Lender.

(l)Notwithstanding anything to the contrary herein, the Existing Letters of Credit shall be considered Letters of Credit issued hereunder.

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2.5Interest and Payment Dates

                                     (a)  Subject to the provisions of Section 2.6, each Base Rate Loan shall bear interest (computed on the basis of the actual number of days elapsed over a year of 365 or 366 days, as the case may be) at a rate per annum equal to the Base Rate plus one hundred twenty-five (125) basis points (1.25%).

(b)Subject to the provisions of Section 2.6, each Eurodollar Loan shall bear interest (computed on the basis of the actual number of days elapsed over a year of 360 days) at a rate per annum equal to the Eurodollar Rate for the Interest Period in effect for such Loan plus two hundred twenty-five (225) basis points (2.25%).

(c)Interest on each Loan shall be payable on each Interest Payment Date applicable to such Loan; provided that, interest accruing on overdue amounts pursuant to Section 2.6 shall be payable on demand as provided in such Section.  The Eurodollar Rate and the Base Rate shall be determined by the Administrative Agent, and such determination shall be conclusive absent manifest error.

2.6Default Interest

.  To the extent not contrary to any Requirement of Law, upon the occurrence and during the continuation of an Event of Default, any principal, past due interest, fee or other amount outstanding hereunder shall bear interest for each day thereafter until paid in full (after as well as before judgment) at a rate per annum which shall be equal to two percent (2%) in excess of the rate which would otherwise be in effect for Base Rate Loans (such rate being referred to as the “Default Rate”); provided that, with respect to Eurodollar Loans, such rate shall be the higher of the Default Rate and two percent (2%) in excess of the rate which would otherwise be applicable to such Eurodollar Loan.  The Borrower acknowledges that such increased interest rate reflects, among other things, the fact that such loans or other amounts have become a substantially greater risk given their default status and that the Lenders are entitled to additional compensation for such risk.

2.7Conversion and Continuation Options; Limitations on Tranches

                                                 (a)  The Borrower shall have the right at any time upon prior irrevocable notice to the Administrative Agent (a) not later than 10:30 a.m., Philadelphia time, on the Business Day of conversion, to convert any Eurodollar Loan to a Base Rate Loan, (b) not later than 10:30 a.m., Philadelphia time, three (3) Business Days prior to conversion or continuation (x) to convert any Base Rate Loan into a Eurodollar Loan, or (y) to continue any Eurodollar Loan as a Eurodollar Loan for any additional Interest Period and (c) not later than 10:30 a.m., Philadelphia time, three (3) Business Days prior to conversion, to convert the Interest Period with respect to any Eurodollar Loan to another permissible Interest Period, subject in each case to the following:

(A)a Eurodollar Loan may not be converted at a time other than the last day of the Interest Period applicable thereto;

(B)any portion of a Loan maturing or required to be repaid in less than one month may not be converted into or continued as a Eurodollar Loan;

(C)no Eurodollar Loan may be continued as such and no Base Rate Loan may be converted to a Eurodollar Loan when any Default or Event of Default has occurred and is continuing;

(D)any portion of a Eurodollar Loan that cannot be converted into or continued as a Eurodollar Loan by reason of clauses (B) or (C) above automatically shall be converted at the end of the Interest Period in effect for such Loan to a Base Rate Loan;

(E)if by the third Business Day prior to the last day of any Interest Period for Eurodollar Loans the Borrower has failed to give notice of conversion or continuation as described in this subsection, the Administrative Agent shall give notice thereof to the Lenders and such Loans shall be automatically converted to Base Rate Loans on the last day of such then expiring Interest Period;

(F)all conversions and continuations of Loans hereunder and all selections of Interest Periods hereunder shall be in such amounts and be made pursuant to such elections that, after giving effect thereto, the aggregate principal amount of the Loans comprising each Tranche of Eurodollar Loans shall be equal to $500,000 or in increments of $500,000 in excess thereof; and

(G)the Borrower shall not have outstanding at any one time more than six (6) Tranches in the aggregate of Eurodollar Loans.

Each request by the Borrower to convert (but not continue) a Loan shall constitute a representation and warranty that each of the representations and warranties made by the Borrower herein is true and correct in all material respects on and as of such date as if made on and as of such date (except to the extent that such representations and warranties relate expressly to an earlier date, in which case such request shall constitute a representation and warranty that such representations and warranties are true and correct as of such date).  Accrued interest on a Loan (or portion thereof) being converted shall be paid by the Borrower at the time of conversion.

(b)In the event, and on each occasion, that on the day two (2) Business Days prior to the commencement of any Interest Period for a Eurodollar Loan, the Administrative Agent shall have determined (which determination absent manifest error shall be conclusive and binding upon the Borrower) that dollar deposits in the principal amount of such Eurodollar Loan are not generally available in the London Interbank Market, or that the rate at which such dollar deposits are being offered will not adequately and fairly reflect the cost to the applicable Lenders of making or maintaining the principal amount of such Eurodollar Loan during such Interest Period, or that reasonable means do not exist for ascertaining the Eurodollar Rate, the Admi nistrative Agent shall, as soon as practicable thereafter, give written or telephonic notice of such determination to the Borrower and the applicable Lenders, and any request by the Borrower for a Eurodollar Loan or for conversion to or maintenance of a Eurodollar Loan pursuant to the terms of this Agreement shall be deemed a request for a Base Rate Loan.  After such notice shall have been given and until the circumstances giving rise to such notice no longer exist, each request for a Eurodollar Loan shall be deemed to be a request for a Base Rate Loan.  Each determination by the Administrative Agent hereunder shall be conclusive absent manifest error.

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2.8Commitment Fees

.  The Borrower agrees to pay to the Administrative Agent for the account of each Revolving Credit Lender, on each January 1, April 1, July 1 and October 1, commencing October 1, 2010, during the Revolving Credit Commitment Period and on the date on which the Revolving Credit Commitments shall be permanently terminated or reduced as provided herein, a revolving credit commitment fee (collectively, the “Commitment Fees”) at a rate per annum equal to thirty (30) basis points (0.30%) on the average daily amount of the Unused Revolving Credit Commitments of each Revolving Credit Lender during the preceding fiscal quarter (or shorter period commencing with the Closing Date or ending on the Revolving Credit Termination Date).  The Commitment Fees due to each Revolving Credit Lender shall comme nce to accrue on the Closing Date and shall cease to accrue on the Revolving Credit Termination Date.  The Administrative Agent shall distribute the Commitment Fees among the Revolving Credit Lenders pro rata in accordance with their respective Revolving Credit Commitment Percentages.

All of the foregoing fees shall be (a) computed on the basis of the actual number of days elapsed in a year of 360 days, including the first day but excluding the last day occurring in the period for which such fees are payable, and (b) paid on the dates due, in immediately available funds, to the Administrative Agent for distribution to the applicable Lenders.  Once paid, none of the foregoing fees shall be refundable under any circumstances, except in the case of manifest error by the Administrative Agent in the computation of any such amount, which error is raised in writing by the Borrower to the Administrative Agent within twenty (20) days of payment of such amount.

2.9Termination and Reduction of Revolving Credit Commitments

                                                (a)  The Revolving Credit Commitments shall be automatically terminated on the Revolving Credit Termination Date whereupon the entire outstanding principal balance of the Revolving Credit Loans, plus all accrued and unpaid interest thereon, and any fees or other amounts owed under the Loan Documents (including all Commitment Fees and fees and other amounts in connection with the Letters of Credit) shall be due and payable.

(b)Upon at least five (5) Business Days’ prior irrevocable written notice to the Administrative Agent, the Borrower may at any time prior to the Revolving Credit Termination Date, in whole permanently terminate, or from time to time in part permanently reduce, the Revolving Credit Commitments; provided, however, that (A) each partial reduction of such Revolving Credit Commitments shall be in a minimum aggregate principal amount of $1,000,000 or in integral multiples of $500,000 in excess thereof, and (B) the Revolving Credit Commitments may not be reduced or terminated if, after giving ef fect thereto and to any prepayments of the Revolving Credit Loans made on the effective date thereof, the aggregate amount of the Revolving Credit Exposure of the Revolving Credit Lenders at such time would exceed the aggregate Revolving Credit Commitments of the Revolving Credit Lenders (as the same are being reduced) at such time.  Each reduction in the Revolving Credits Commitments hereunder shall be made ratably among the Revolving Credit Lenders in accordance with their respective Revolving Credit Commitment Percentages.  The Borrower shall pay to the Administrative Agent for the account of the Revolving Credit Lenders on the date of each termination or reduction of the Revolving Credits Commitments, the Commitment Fees on the amount of the Revolving Credit Commitments so terminated or reduced accrued to the date of such termination or reduction.

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2.10Optional and Mandatory Prepayments of Loans

                                                 (a) The Borrower shall have the right at any time and from time to time to prepay any Borrowing, in whole or in part, without premium or penalty (but in any event subject to Section 2.14), upon prior written, telecopy or telephonic notice to the Administrative Agent given no later than 10:30 a.m., Philadelphia time, (i) in the case of Base Rate Loans, on the same day such prepayment is to be made, and (ii) in the case of Eurodollar Loans, three (3) Business Days before any proposed prepayment is to be made; provided, however, that each such partial prepayment shall be in the principal amount of at least (A) $500,000 or in whole multiples of $100,000 in the case of Base Rate Loans and (B) $500,000 or in whole multiples of $500,000 in excess thereof in the case of Eurodollar Loans.

(b)On the date of any termination or reduction of the Revolving Credit Commitments pursuant to Section 2.9, the Borrower shall pay or prepay so much of the Revolving Credit Loans as shall be necessary in order that the aggregate Revolving Credit Exposure of the Revolving Credit Lenders will not exceed the aggregate Revolving Credit Commitments of the Revolving Credit Lenders after giving effect to such termination or reduction.

(c)In the event of (i) any direct or indirect sale or other disposition of any of the assets, including lines of business, of any Subsidiary of the Parent (other than sales or dispositions referred to in subsections 6.5(a), (b) or (c)) (each, an “Asset Sale”) the sale price for which in the aggregate with all prior Asset Sales made since the date of this Agreement (but only those Asset Sales the Net Proceeds of which were not applied as a prepayment as hereinafter provided in this subsection 2.10(c)) is greater than $1,000,000, (ii) any sale or issuance of Capital Stock by the Parent (other than Capital Stock issued (x) to any seller in conn ection with a Permitted Acquisition or (y) pursuant to any employee equity plan of the Parent or its Subsidiaries), (iii) the incurrence of additional Indebtedness for borrowed money by the Parent or any of its Subsidiaries (other than Indebtedness incurred to a seller in connection with a Permitted Acquisition or otherwise permitted under Section 6.2 (other than Subordinated Debt under subsection (g) thereto unless such Subordinated Debt was incurred in connection with financing a Permitted Acquisition)), or (iv) any Material Recovery Event, the Borrower shall promptly prepay the outstanding Loans in an amount equal to one hundred percent (100%) of the amount of the Net Proceeds of such Asset Sale, issuance of Capital Stock, incurrence of additional Indebtedness or Material Recovery Event; provided that, the amount of any prepayment hereunder shall be rounded down to the nearest multiple of $1,000; provided, further, that no such repayment shall be required in respect of the Net Proceeds arising from (x) an Asset Sale if, and to the extent, that the Borrower or such Subsidiary has reinvested any such Net Proceeds arising from such Asset Sale in productive assets of a kind then used or useable in the business of a Subsidiary of the Parent (including Capital Expenditures) prior to the date that is one hundred eighty days (180) after the date such Asset Sale is closed or (y) a Material Recovery Event if, and to the extent that, (I) the Borrower has notified the Administrative Agent in writing within five (5) Business Days following the receipt of the proceeds of such Material Recovery Event of such Subsidiary’s intention to use such Net Proceeds for the repair, replacement or restoration of the damaged condemned property within one hundred and eighty (180) days following the receipt of such proceeds and (II) such Subsidiary does in fact reinvest such Net Proceeds arising from such Material Recovery Event for the repair, replacement or restoration of the damaged or condemned property prior to the date that is one hundred eighty days (180) after the receipt of such Net Proceeds.  At the time any such Asset Sale, issuance of Capital Stock or incurrence of additional Indebtedness is completed, or promptly after any Net Proceeds are received by the Parent or a Subsidiary thereof in connection with a Material Recovery Event (and, if the Borrower has given notice of its or such Subsidiary’s, as the case may be, intention to use all or a portion of the Net Proceeds from a Material Recovery Event as provided above, one hundred and eighty (180) days after its receipt of such Net Proceeds), the Borrower shall deliver to the Administrative Agent an accounting of the Net Proceeds in sufficient detail and form acceptable to the Administrative Agent together with the amount of any prepayment or repayment required at such time.  Payments made pursuant to this subsection 2.10(c) shall be applied in accordance with subsection 2.10(f) below.

(d)[INTENTIONALLY OMITTED]

(e)Each notice of prepayment pursuant to subsections (a) and (b) of this Section 2.10 shall specify (i) the prepayment date and (ii) the principal amount of each Borrowing to be prepaid.  Each notice of prepayment shall be irrevocable and shall commit the Borrower to prepay such Borrowing (or portion thereof) by the amount stated therein.  All prepayments under this Section 2.10 on other than Base Rate Borrowings shall be accompanied by accrued interest on the principal amount being prepaid to the date of prepayment and any amounts owed under Section 2.14.

(f)Payments pursuant to clause (c) of this Section 2.10 shall be applied to Revolving Credit Loans until paid in full; provided that, if an Event of Default shall have occurred and be continuing, any such payments shall be applied pro rata to the Loans and the Letter of Credit Obligations (based on the principal amount of the Loans outstanding and the aggregate amount of the Letter of Credit Obligations then outstanding), with any amounts attributable to the Letter of Credit Obligations to be held by the Administrative Agent in a cash collateral account pursuant to Section 7.2 or, at the Administrative A gent’s discretion, applied to the Revolving Credit Loans then outstanding.  Payments of the Revolving Credit Loans and/or in respect of the Letter of Credit Obligations shall not reduce the Revolving Credit Commitments.  To the extent any prepayments are required pursuant to clause (c) of this Section 2.10 after the Loans have been paid in full, then, no such payments shall be required unless an Event of Default shall have occurred and be continuing, in which case the Borrower shall deliver to the Administrative Agent, to be held in a cash collateral account pursuant to Section 7.2, an amount equal to the difference between (i) the Letter of Credit Coverage Requirement and (ii) the amount of cash, if any, then held by the Administrative Agent in a collateral account pursuant to Section 7.2, with any remaining Net Proceeds to be applied first to any other outstanding Obligations and next to be retained by the Parent, the Borrower or its Subsidiary, as applicable.   ;So long as no Event of Default shall have occurred and be continuing, unless otherwise requested by the Borrower, each payment shall be applied first to Base Rate Loans and next to Eurodollar Loans in the direct order of maturity of Interest Periods.

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2.11Illegality

.  Notwithstanding any other provision herein, if any change in any Requirement of Law or in the interpretation or application thereof shall make it unlawful for any Lender to make or maintain Eurodollar Loans as contemplated by this Agreement, (a) the commitment of such Lender hereunder to make Eurodollar Loans, continue Eurodollar Loans as such and convert or refinance Base Rate Loans to Eurodollar Loans shall forthwith be cancelled and (b) such Lender’s Loans then outstanding as Eurodollar Loans, if any, shall be converted automatically to Base Rate Loans on the respective last days of the then current Interest Periods with respect to such Loans or within such earlier period as required by law.  If any such conversion of a Eurodollar Loan occurs on a day which is not the last day of the then current Interest Period with respect thereto, the Borrower shall pay to such Lender such amounts, if any, as may be required pursuant to Section 2.14.

2.12Requirements of Law

                                                 (a)  In the event that any change in any Requirement of Law or in the interpretation, or application thereof or compliance by any Lender with any request or directive (whether or not having the force of law) from any central bank or other Governmental Authority made subsequent to the date hereof:

(i)shall subject any Lender to any tax of any kind whatsoever with respect to this Agreement, any Note or any Eurodollar Loan made by it, or change the basis of taxation of payments to such Lender in respect thereof (except for taxes covered by Section 2.13 and changes in the rate of tax on the overall net income, gross receipts or revenue of such Lender);

(ii)shall impose, modify or hold applicable any reserve, special deposit or similar requirement against assets held by, deposits or other liabilities in or for the account of, advances, loans or other extensions of credit by, or any other acquisition of funds by, any office of such Lender which is not otherwise included in the determination of the interest rate on such Eurodollar Loan hereunder; or

(iii)shall impose on such Lender any other condition;

and the result of any of the foregoing is to increase the cost to such Lender, by an amount which such Lender deems to be material, of making, converting into, continuing or maintaining Eurodollar Loans or to reduce any amount receivable hereunder in respect thereof then, in any such case, the Borrower shall as promptly as practicable pay such Lender, upon its demand, any additional amounts necessary to compensate such Lender for such increased cost or reduced amount receivable.  If any Lender becomes entitled to claim any additional amounts pursuant to this subsection, it shall as promptly as practicable notify the Borrower, through the Administrative Agent, of the event by reason of which it has become so entitled.  A certificate as to any additional amounts payable pursuant to this subsection submitted by such Lende r, through the Administrative Agent, to the Borrower shall be conclusive in the absence of manifest error.  This covenant shall survive the termination of this Agreement and the payment of the Notes and all other amounts payable hereunder.  If any amount is refunded to such Lender, such Lender will reimburse the Borrower for amounts paid in respect of the refunded amount without interest (except to the extent of any interest actually received by such Lender from the relevant Governmental Authority with respect to such refund).

(b)In the event that any Lender shall have determined that any change in any Requirement of Law regarding capital adequacy or in the interpretation or application thereof or compliance by such Lender or any corporation controlling such Lender with any request or directive regarding capital adequacy (whether or not having the force of law) from any Governmental Authority made subsequent to the date hereof does or shall have the effect of reducing the rate of return on such Lender’s or such corporation’s capital as a consequence of its obligations hereunder to a level below that which such Lender or such corporation could have achieved but for such change or compliance (taking into consideration such Lender’s or suc h corporation’s policies with respect to capital adequacy) by an amount deemed by such Lender to be material, then from time to time, after submission as promptly as practicable by such Lender to the Borrower (with a copy to the Administrative Agent) of a written request therefor, the Borrower shall pay to such Lender such additional amount or amounts as will compensate such Lender for such reduction.

(c)Each Lender agrees that it will use reasonable efforts in order to avoid or to minimize, as the case may be, the payment by the Borrower of any additional amount under subsections 2.12(a) and (b); provided, however, that no Lender shall be obligated to incur any expense, cost or other amount in connection with utilizing such reasonable efforts; provided, further, that the Borrower shall not be under any obligation to compensate any Lender under this Section 2.12 with respec t to increased costs or reductions with respect to any period prior to the date that is one hundred eighty (180) days prior to such request if such Lender knew or could reasonably have been expected to know of the circumstances giving rise to such increased costs or reductions and of the fact that such circumstances would result in a claim for increased compensation by reason of such increased costs or reductions; provided, further, that the foregoing limitation shall not apply to any increased costs or reductions arising out of the retroactive application of any change in any Law within such one hundred eighty (180) day period.

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2.13Taxes

.  (a)  All payments made by the Borrower under this Agreement and the Notes shall be made free and clear of, and without deduction or withholding for or on account of, any present or future income, stamp or other taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now or hereafter imposed, levied, collected, withheld or assessed by any Governmental Authority, other than Excluded Taxes (all such non-excluded taxes, levies, imposts, duties, charges, fees, deductions and withholdings being hereinafter called “Taxes”).  If any Taxes are required to be withheld from any amounts payable to the Administrative Agent or any Lender hereunder or under the Notes, the amounts so payable to the Administrative Agent or such Lender shall be increased to the extent necessary to yield to the Administrative Agent or such Lender (after payment of all Taxes) interest or any such other amounts payable hereunder at the rates or in the amounts specified in this Agreement and the Notes.  Whenever any Taxes are payable by the Borrower, as promptly as possible thereafter the Borrower shall send to the Administrative Agent for its own account or for the account of such Lender, as the case may be, a certified copy of an original official receipt received by the Borrower showing payment thereof.  If the Borrower fails to pay any Taxes when due to the appropriate taxing authority or fails to remit to the Administrative Agent the required receipts or other required documentary evidence, the Borrower shall indemnify the Administrative Agent and the Lenders for any incremental taxes, interest or penalties that may become payable by the Administrative Agent or any Lender as a result of any such failure.  The agreement s in this subsection shall survive the termination of this Agreement and the payment of the Notes and all other amounts payable hereunder.

(b)Any Foreign Lender that is entitled to an exemption from or reduction of withholding tax under the law of the jurisdiction in which the Borrower is located, or any treaty to which such jurisdiction is a party, with respect to payments under this Agreement shall deliver to the Borrower (with a copy to the Administrative Agent), at the time or times prescribed by applicable law, such properly completed and executed documentation prescribed by applicable law or reasonably requested by the Borrower as will permit such payments to be made without withholding or at a reduced rate.  Each such Foreign Lender shall also deliver to the Borrower (with a copy to the Administrative Agent) such further documentation on or before the date that any documentation previously delivered to the Borrower hereunder shall expire or become obsolete and after the occurrence of any event requiring a change in such previously delivered documentation.

(c)The Borrower shall not be required to pay any additional amounts to the Administrative Agent or any Lender in respect of payments of United States withholding tax or other Taxes made by the Borrower which are consistent with the forms and information delivered to the Borrower and the Administrative Agent or if the payment of such amounts would not have arisen but for a failure by the Administrative Agent or such Lender to comply with the requirements of subsection 2.13(b) or the Administrative Agent or such Lender did not timely deliver to the Borrower the forms listed or described in subsection 2.13(b) or did not take such other steps as reasonably may be available to it under applicable tax laws and any applicable tax treaty o r convention to obtain an exemption from, or reduction (to the lowest applicable rate) of, such United States withholding tax and other Taxes or, if such steps were taken, the information was not timely and duly delivered to the Borrower.

2.14Indemnity

.  (a)  The Borrower agrees to indemnify each Lender and to hold each Lender harmless from any loss or expense which such Lender may sustain or incur as a consequence of (a) default by the Borrower in payment when due of the principal amount of or interest on any Eurodollar Loan, (b) default by the Borrower in making a borrowing of, conversion into or continuation of Eurodollar Loans after the Borrower has given a notice requesting the same in accordance with the provisions of this Agreement, (c) default by the Borrower in making any prepayment after the Borrower has given a notice thereof in accordance with the provisions of this Agreement or (d) the making of a prepayment of Eurodollar Loans on a day which is not the last day of an Interest Period with respect thereto, including, without limitation, in each case, any such loss or expense arising from the reemployment of funds obtained by it or from fees payable to terminate the deposits from which such funds were obtained.  A certificate as to any amounts (including a calculation thereof) that a Lender is entitled to receive under this Section 2.14 submitted by such Lender, through the Administrative Agent, to the Borrower shall be conclusive in the absence of manifest error and all such amounts shall be paid by the Borrower promptly upon demand by such Lender.  This covenant shall survive the termination of this Agreement and the payment of the Notes and all other amounts payable hereunder.

(b)For the purpose of calculation of all amounts payable to a Lender under this Section, each Lender shall be deemed to have actually funded its relevant Eurodollar Loan through the purchase of a deposit bearing interest at the Eurodollar Rate in an amount equal to the amount of that Eurodollar Loan and having a maturity comparable to the relevant Interest Period or applicable period for such Eurodollar Loan; provided, however, that each Lender may fund each of its Eurodollar Loans in any manner it sees fit, and the foregoing assumptions 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 Loans and all other amounts payable hereunder.

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2.15Treatment of Loans and Payments

Except as provided under Sections 2.4, 2.11, 2.13 or subsection 9.6(g), each Borrowing by the Borrower hereunder, each payment or prepayment of principal of the Loans, each payment of interest on the Loans, each payment of Commitment Fees and participation in Letters of Credit shall be made pro rata among the relevant Lenders in accordance with their respective Revolving Credit Commitment Percentage.  Each Lender agrees that in computing such Lender’s portion of any borrowing to be made hereunder, the Administrative Agent may, in its discretion, round each Lender’s amount of such borrowing to the next higher or lower whole dollar amount.

2.16Payments

                                                 (a)  The Borrower shall make each payment (including principal of or interest on any Borrowing or any fees or other amounts) hereunder not later than 12:00 (noon), Philadelphia time, on the date when due to the Administrative Agent at its offices set forth in Section 9.2, in immediately available funds.  Such payments shall be made without setoff or counterclaim of any kind.  The Administrative Agent shall distribute to the Lenders any payments received by the Administrative Agent for their account promptly upon receipt in li ke funds as received, provided that, any payment received by the Administrative Agent for the account of the Lenders at or before 2:00 p.m. Pennsylvania time will be distributed to the Lenders on the same Business Day and any such payment received after that time on a given day may be distributed on the next Business Day.

(b)Whenever any payment hereunder or under the Notes shall be stated to be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day, and such extension of time shall in such case be included in the computation of the payment of interest or fees, as the case may be, provided that if such extension would cause payment of any interest on or principal of the Loans or payment of any commitment fees to be made in the next following calendar month, such payment shall be made on the immediately preceding Business Day.

(c)In the event that any payment of principal, interest or commitment fees due the Lenders or the Administrative Agent under any of the Loan Documents is not paid when due, the Administrative Agent is hereby authorized to effect such payment upon prior notice to the Borrowerby debiting any demand deposit account of the Borrower now or in the future maintained with the Administrative Agent.  This right of debiting accounts of the Borrower is in addition to any right of setoff accorded the Lenders hereunder or by operation of law.

2.17Loan Accounts

.  Each Lender shall open and maintain on its books a loan account in the Borrower’s name with respect to Loans made, repayments, prepayments, the computation and payment of interest and other amounts due and sums paid to such Lender hereunder and under the Loan Documents.  Except in the case of manifest error in computation, such records shall be presumed correct as to the amount at any time due to such Lender from the Borrower.  The failure of any Lender to make an entry in its loan account shall not abrogate the Borrower’s duty to repay the Indebtedness and other amounts owed to such Lender under the Loan Documents.

2.18Assignment of Loans and/or Revolving Credit Commitments Under Certain Circumstances; Duty to Mitigate

In the event (a) any Lender delivers a notice pursuant to Section 2.11 that it has become unlawful for such Lender to make or maintain Eurodollar Loans, (b) any Lender delivers a certificate requesting compensation pursuant to Section 2.12 or (c) the Borrower is required to pay any additional amount to any Lender or any Governmental Authority on account of any Lender pursuant to Section 2.13, the Borrower may, at its sole expense and effort (including with respect to the processing and recordation fee referred to in subsection 9.6(b)), upon notice to such Lender and the Administrative Agent, require such Lender to transfer and assign, without recourse (in accordance with and subject to the restrictions contained in Section 9.6), all of its interests, rights and obligations under this Agreement to a Purchasing Lender that shall assume such assigned obligations (which Purchasing Lender may be another Lender, if a Lender accepts such assignment); provided that (i) such assignment shall not conflict with any law, rule or regulation or order of any court or other Governmental Authority having jurisdiction, (ii) the Borrower shall have received the prior written consent of the Administrative Agent and the Issuing Bank, which consents shall not be unreasonably delayed or withheld, (iii) the Borrower or such Purchasing Lender shall have paid to the affected Lender in immediately available funds an amount equal to the sum of the principal of and interest accrued to the date of such payment on the outstanding Loans, plus all fees (including, without limitation, Commitment Fees) and other amounts accrued hereunder for the account of such Lender (including, without limitation, amounts owing under Sections 2.12, 2.13 and 2.14) and (iv) to the extent such affected Lender is also the Issuing Bank, (A) the Borrower or such Purchasing Lender  shall have paid to the Issuing Bankall L/C Disbursements, plus all fees (including, without limitation, Letter of Credit Fees) and other amounts accrued hereunder for the account of the Issuing Bank and (B) the Borrower shall have either (I) returned to the Issuing Bank the original of any outstanding Letters of Credit or (II) delivered to the Issuing Bank cash collateral for any such outstanding Letters of Credit in an amount equal to the Letter of Credit Coverage Requirement for each such Letter of Credit the original of which is not returned to the Issuing Bank.  Each Lender hereby grants to the Administrative Agent an irrevocable power of attorney (which power is coupled with an interest) to execute and deliver, on behalf of such Lender as assignor, any Assignment and Assumption necessary to effectuate any assignment of such LenderR 17;s interests hereunder in the circumstances contemplated by this Section 2.18.

2.19Use of Proceeds

The proceeds of the Loans may be used by the Borrower for its working capital, capital expenditures and general corporate purposes in the ordinary course of business (including paying the fees and expenses associated with the Loan Documents) and to finance all or a portion of the purchase price and transaction costs in connection with Permitted Acquisitions.  The Letters of Credit shall be letters of credit required in the ordinary course of business of the Parent’s Subsidiaries or in connection with Permitted Acquisitions.

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SECTION 3.  REPRESENTATIONS AND WARRANTIES

To induce the Administrative Agent, the Lenders and the Issuing Bank to enter into this Agreement and to make the Loans and to issue and/or participate in Letters of Credit, the Borrower hereby represents and warrants to the Administrative Agent and each Lender that:

3.1Corporate Existence

Each of the Borrower and the other Loan Parties is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, and is duly qualified or licensed to do business and is in good standing in all other jurisdictions in which the character of the properties owned or the nature of the activities conducted by it makes such qualification or licensing necessary, except where the failure to be so qualified would not reasonably be expected to have a Material Adverse Effect; provided, that Kenexa Strategic Outsourcing Corporation is not in good standing with the Comptroller of Texas on the Closing Date, but is diligently pursuing the necessary documentation to correct such issue, and Kenexa Strategic Outsourcing Corporation shall be in go od standing with the Comptroller of Texas within forty five (45) days of the Closing Date.

3.2Subsidiaries

The Subsidiaries of the Parent and the record ownership of each such Subsidiary on the date hereof are listed on Schedule 3.2 attached hereto.

3.3Authority and Binding Effect

Each of the Borrower and the other Loan Parties has all requisite power and authority, corporate and otherwise, to own, lease, encumber and operate its properties and assets and to carry on its business as now being conducted and to enter into and to perform its obligations under this Agreement, the Notes and the other Loan Documents to which it is a party and to fulfill its obligations set forth herein and therein.  The execution, delivery and performance of this Agreement, the borrowings hereunder and the execution and delivery of the Notes, the Applications and the other Loan Documents to which the Borrower or any other Loan Party is a party have been duly authorized by all requisite corporate action and will not violate or constitute a default under any Requirement of Law, or of any indenture, note, loan or credit agreement, license or any other agreement, lease or instrument to which the Parent or any of its Subsidiaries is a party or by which the Parent or any of its Subsidiaries or any of its or their Properties are bound.  This Agreement and the other Loan Documents have each been duly executed and delivered by each Loan Party party thereto.  This Agreement constitutes, and the Notes and other Loan Documents issued or to be issued hereunder, when executed and delivered pursuant hereto, will constitute, the authorized, valid and legally binding obligations of the Borrower or other Loan Party party thereto enforceable in accordance with their respective terms, except as limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws or equitable principles from time to time in effect relating to or affecting the rights of creditors generally.

3.4Approvals

No consent or approval of any trustee or holder of any indebtedness, nor any authorization, consent, approval, license, exemption of or registration, declaration or filing with any court or governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign, is or will be necessary to the valid execution and delivery of this Agreement, the Notes or the other Loan Documents or the consummation by the Borrower or the other Loan Parties of the transactions contemplated by this Agreement, except such as have been obtained.

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3.5Recording and Enforceability

No recording, filing, registration, notice or other similar action is required in order to insure the legality, validity, binding effect or enforceability of this Agreement, the Notes or the other Loan Documents as against the Borrower and any other Loan Party.

3.6Litigation

Schedule 3.6 attached hereto contains a list as of the date hereof of all litigation, claims, disputes, assessments, judgments, judicial and administrative orders outstanding against the Parent or any of its Subsidiaries and any actions, suits or proceedings at law or in equity or by or before any governmental or administrative instrumentality or other agency pending or, to the knowledge of the Borrower, threatened against the Parent or any of its Subsidiaries or affecting its or their property or rights which in any such case if decided adversely individually or in the aggregate would reasonably be expected to have a Material Adverse Effect.  Neither the Parent nor any Subsidiary is in default under any applicable statute, rule, order, certificate or regulation of any Governmental Authority having jurisdiction over the Parent or any Subsidiary thereof which default would reasonably be expected to have a Material Adverse Effect.  No litigation, investigation or proceeding of or before any arbitrator or Governmental Authority is pending or, to the knowledge of the Borrower, threatened against the Borrower, any other Loan Party or any of its or their respective Subsidiaries or against any of its or their respective business, operations, properties, prospects or condition (financial or otherwise) (a) with respect to this Agreement, the Notes, the other Loan Documents or any of the transactions contemplated hereby, or (b) as to which there is a reasonable likelihood of an adverse determination and which, if adversely determined, would reasonably be expected to have a Material Adverse Effect.

3.7Financial Information

The Borrower has delivered to the Administrative Agent true, correct and complete copies of the Parent’s audited balance sheet as of December 31, 2009 and statements of profit and loss and surplus for the year then ended which have been certified by Grant Thornton LLPand the Parent’s unaudited internally prepared balance sheet as of June 30, 2010 and statements of profit and loss and surplus for the quarter then ended.  All such financial statements have been prepared in accordance with GAAP, except for the absence of footnotes and subject to year-end adjustments in the unaudited financial statements, and are true and complete and present fairly in accordance with GAAP, the financial condition and results of operations of the Parent and its Subsidiaries as of such dates and for the periods covered thereby, and said balance sheets accurately reflect all liabilities, including contingent liabilities that are required by GAAP to be reflected thereon as of the dates thereof.  Since June 30, 2010, there has been no development or event nor any prospective development or event which individually or in the aggregate would reasonably be expected to have a Material Adverse Effect.

3.8Taxes

Each of the Parent and its Subsidiaries has filed all federal, state and local tax returns which it is required by law to file, subject to the timely filing of any extension therefor, and has paid all material taxes, assessments and other governmental charges due in respect of such returns, except to the extent that any such taxes, assessments or other governmental charges are being contested in good faith and as to which the Parent or such Subsidiary has set aside on its books adequate reserves.  No federal tax Lien has been filed against the Parent or any of its Subsidiaries.

3.9Intellectual Property

Each of the Borrower and the other Loan Parties owns, or is licensed to use, all trademarks, tradenames, copyrights, technology, know-how and processes necessary for the conduct of its business as currently conducted (the “Intellectual Property”) except for those as to which the failure to own or license would not reasonably be expected to have a Material Adverse Effect.  As of the date hereof, except as set forth on Schedule 3.9, no claim has been asserted against the Parent or any Subsidiary and is pending by any Person challenging or questioning the use of any such Intellectual Property, nor to the Borrower’s knowledge, is any such claim threatened and, with respect to any time thereafter, no such claim has been asserted which would reason ably be expected to have a Material Adverse Effect.  To the Borrower’s knowledge, the use of such Intellectual Property by the Borrower and the other Loan Parties does not infringe the rights of any Person, except for such claims and infringements that, in the aggregate, would not reasonably be expected to have such a Material Adverse Effect.

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3.10Intentionally Omitted

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3.11Material Agreements

As of the date hereof, Schedule 3.11 attached hereto contains a list of all of the Parent’s and its Subsidiaries’ material leases, contracts, agreements, understandings and commitments of any kind the breach of which would directly or indirectly reasonably be expected to have a Material Adverse Effect and all parties (including the Parent and its Subsidiaries) to all such material leases, contracts, agreements, understandings and commitments have to the Borrower’s knowledge complied with the provisions thereof in all material respects and neither the Parent nor any of its Subsidiaries is in material default under any provision thereof and to the knowledge of the Borrower (i) no other party thereto is in default under any material provision thereof and (ii) no event has occurred which, but for the giving of notice or the passage of time, or both, would constitute a material default thereunder.

3.12Compliance With Law

Each of the Parent and its Subsidiaries is in compliance with all Requirements of Law except to the extent that the failure to comply therewith would not in the aggregate reasonably be expected to have a Material Adverse Effect.  As of the date hereof, no Loan Party has received any written notice, not heretofore complied with, from any federal, state or local authority or any insurance or inspection body to the effect that any of its properties, facilities, equipment or business procedures or practices fail to materially comply with any applicable law, ordinance, regulation, building or zoning law, or any other requirements of any such authority or body, except where such failure would not reasonably be expected to have a Material Adverse Effect.

3.13Title to Property

Each of the Parent and its Subsidiaries has good title to or valid leasehold interests in or license to use or similar interests in all personal properties, assets and other rights which it purports to own or lease or which is reflected as owned or leased on its respective books and records (except where failure to have good title to, or valid leasehold or similar interests in, would not reasonably be expected to have a Material Adverse Effect), free and clear of all Liens except Permitted Liens, and subject to the terms and conditions of the applicable leases.  Except for financing statements evidencing Permitted Liens or protective filings related to operating leases or other assets in the possession of, but not owned by, the Parent or any of its Subsidiaries, no effective financing statement under the Uniform Commercial Code is in effect in any jurisdiction and no other filing which names the Parent or any of its Subsidiaries as debtor or which covers or purports to cover any of the assets of the Parent or any of its Subsidiaries is currently effective and on file in any state or other jurisdiction.  All of the assets and properties of the Parent and its Subsidiaries that are necessary for the operation of their respective businesses are in good working condition and are able to serve the functions for which they are currently being used, except for ordinary wear and tear.

3.14Security Interests

At all times after execution and delivery of the Security Documents by the Loan Party or Loan Parties party thereto and completion of the filings and recordings (to the extent not already filed and recorded prior to the Closing Date) in the jurisdictions listed on Schedule 3.14, and delivery to the Administrative Agent of possession or control, as applicable, of all Collateral the perfection of a security interest in which requires possession or control under the Uniform Commercial Code, the security interests created for the benefit of the Administrative Agent and the Lenders pursuant to the Security Documents will constitute valid, perfected security interests in the Collateral subject thereto, subject to no other Liens whatsoever, except Permitted Liens.

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3.15Federal Regulations

No part of the proceeds of any Loans will be used for “purchasing” or “carrying” any “margin stock” within the respective meanings of each of the quoted terms under Regulation U or for any purpose which violates the provisions of Regulation U or any other Regulations of the Board of Governors of the Federal Reserve System.  If requested by any Lender or the Administrative Agent, the Borrower will furnish to the Administrative Agent and each Lender a statement to the foregoing effect in conformity with the requirements of FR Form U-l referred to in said Regulation U.  No part of the proceeds of the Loans hereunder will be used for any purpose which violates, or which is inconsistent with, the provisions of any of Regulations D, T, U and X.

3.16ERISA

Except as specifically disclosed on Schedule 3.16 to this Agreement:  (a) there is no Accumulated Funding Deficiency with respect to any Employee Pension Plan, (b) no Reportable Event (excluding those for which notice has been waived by the PBGC) has occurred with respect to any Employee Pension Plan, (c) neither the Parent nor any Commonly Controlled Entity has incurred Withdrawal Liability with respect to any Multiemployer Plan, and (d) no Multiemployer Plan is in Reorganization.  No liability (whether or not such liability is being litigated) in excess of $250,000 has been asserted against the Parent or any Commonly Controlled Entity in connection with any Employee Pension Plan or any Multiemployer Plan by the PBGC, by a trustee appointed pursuant to S ection 4042(b) or (c) of ERISA, or by a sponsor or an agent of a sponsor of a Multiemployer Plan, and no Lien has been attached and no Person has, to the Borrower’s knowledge, threatened to attach a Lien on any of the Parent’s or any Commonly Controlled Entity’s property as a result of failure to comply with ERISA or as a result of the termination of any Employee Pension Plan.  Each Employee Pension Plan, as most recently amended, including amendments to any trust agreement, group annuity or insurance contract, or other governing instrument, is the subject of a favorable determination by the Internal Revenue Service with respect to its qualification under Section 401(a) of the Code, and to the knowledge of the Borrower, no amendment adopted after such determination negatively affects the qualification of such Plan.  Neither the Parent nor any Commonly Controlled Entity has an unfulfilled obligation to contribute to any Multiemployer Plan.

3.17Fictitious Names

Neither the Parent nor its Subsidiaries operate or do business under any assumed, trade or fictitious names, other than as listed on Schedule 3.17, or if after the date hereof, disclosed to the Administrative Agent in writing.

3.18No Event of Default

No Default or Event of Default has occurred and is continuing.

3.19Solvency

Each of the Parent and its Subsidiaries is, and after receipt and application of any Loans hereunder, including the initial Loans will be, Solvent.

3.20Investment Company Act

Neither the Parent nor any Subsidiary thereof is an “investment company”, or a company “controlled” by an “investment company”, within the meaning of the Investment Company Act of 1940, as amended.

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3.21Environmental Matters

Except to the extent that all of the following would not reasonably be expected to have a Material Adverse Effect:

(a)The Properties do not contain, and have not previously contained, in, on, or under, including, without limitation, the soil and groundwater thereunder, any Materials of Environmental Concern in amounts or concentrations that constitute or constituted a violation of, or reasonably would reasonably be expected to give rise to liability under Environmental Laws.

(b)The Properties and all operations and facilities at the Properties are in compliance, and have in the last five years been in compliance with all Environmental Laws, and there is no contamination at, under or about the Properties or violation of any Environmental Law with respect to the Properties or the business operated by the Parent and its Subsidiaries which would reasonably be expected to interfere with the continued operation of any of the Properties or impair the fair saleable value of any thereof.  Neither the Parent nor any Subsidiary has assumed any liability of any Person under Environmental Laws.

(c)Neither the Parent nor any Subsidiary has received nor is it aware of any claim, notice of violation, alleged violation, non-compliance, investigation or advisory action or potential liability regarding environmental matters or compliance of Environmental Law with regard to the Properties which has not been satisfactorily resolved by the Parent or its Subsidiary and neither the Parent nor any Subsidiary is aware and has no reason to believe that any such action is being contemplated, considered or threatened.

(d)Materials of Environmental Concern have not been generated, treated, stored, transported, disposed of, at, on, from or under any of the Properties by the Parent or any of its Subsidiaries, nor have any Materials of Environmental Concern been transferred by the Parent or any of its Subsidiaries from the Properties to any other location except in either case in the ordinary course of business of the Parent and its Subsidiaries in compliance with all Environmental Laws and such that it would not reasonably be expected to give rise to liability under any applicable Environmental Law.

(e)There are no governmental, administrative actions or judicial proceedings pending or, to the best knowledge of the Borrower, contemplated or threatened under any Environmental Laws to which the Parent or any of its Subsidiaries is or will be named as a party with respect to the Properties, nor are there any consent decrees or other decrees, consent orders, administrative orders or other orders, or other administrative or judicial requirements outstanding under any Environmental Law with respect to any of the Properties.

3.22Labor Matters

Except as set forth on Schedule 3.22, as of the Closing Date, there are no collective bargaining agreements or Multiemployer Plans covering the employees of the Parent or its Subsidiaries, and neither the Parent nor its Subsidiaries has suffered any strikes, walkouts, work stoppages or other material labor difficulty within the last five years and to the knowledge of the Borrower, there are none now threatened.

3.23Anti-Terrorism Laws

                                                (a)  Neither the Parent, its Subsidiaries nor, to the Borrower’s knowledge, their Affiliates are in violation of any Anti-Terrorism Law nor does the Parent or its Subsidiaries engage in or conspire to engage in any transaction  that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in any Anti-Terrorism Law.

(b)Executive Order No. 13224.  Neither the Parent, its Subsidiaries nor, to the Borrower’s knowledge, any of their Affiliates or agents acting or benefiting in any capacity in connection with the extensions of credit or other transactions hereunder, is any of the following (each a “Blocked Person”):

(i)a Person that is listed in the annex to, or is otherwise subject to the provisions of, Executive Order No. 13224;

(ii)a Person owned or controlled  by, or acting for or on behalf of, any Person that is listed in the annex to, or is otherwise subject to the provisions of, Executive Order No. 13224;

(iii)a Person or entity with which any Lender is prohibited from dealing or otherwise engaging in any transaction by any Anti-Terrorism Law;

(iv)a Person or entity that commits, threatens or conspires to commit or supports “terrorism” as defined in Executive Order No. 13224;

(v)a Person or entity that is named as a “specially designated national” on the most current list published by the U.S. Treasury Department Office of Foreign Asset Control at its official website or any replacement website or other replacement official publication of such list; or

(vi)a person or entity who is affiliated or affiliated with a person or entity listed above.

The Parent does not nor, to the Borrower’s knowledge, does any of the Parent’s Subsidiaries, Affiliates or agents acting in any capacity in connection with the extensions of credit hereunder or other transactions hereunder (x) conduct any business or engage in making or receiving any contribution of funds, goods or services to or for the benefit of any Blocked Person, or (y) deal in, or otherwise engage in any transaction relating to, any property or interests in property blocked  pursuant to the Executive Order No. 13224.

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3.24[INTENTIONALLY OMITTED]

.

3.25No Burdensome Agreements

Neither the Parent nor any Subsidiary thereof is a party to or bound by any agreement or instrument or subject to any corporate or other restriction the performance or observance of which now has or, as far as the Borrower can reasonably foresee, would reasonably be expected to have, a Material Adverse Effect.

3.26No Misrepresentations or Material Nondisclosures

Neither this Agreement nor any other document, certificate or statement furnished to the Administrative Agent or the Lenders in connection herewith contains any untrue statement of a material fact or omits to state a material fact necessary in order to make the statements contained herein and therein not misleading.  As of the Closing Date, there is no fact known to the Borrower which now or in the future (so far as the Borrower can reasonably foresee) would reasonably be expected to have a Material Adverse Effect which has not been set forth in this Agreement or in the other documents, certificates and statements furnished to the Lenders in connection with the transactions contemplated hereby.

All of the foregoing representations and warranties shall survive the execution and delivery of the Revolving Credit Notes and the making by the Lenders of the Loans and issuance of Letters of Credit hereunder and shall continue in full force and effect so long as any indebtedness or obligation of the Borrower to the Lenders and/or the Administrative Agent hereunder or under the other Loan Documents is outstanding or unperformed or this Agreement remains in effect.

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SECTION 4.  CONDITIONS PRECEDENT

4.1Conditions to Closing

The agreement of each Lender to enter into this Agreement and to make the initial Loans requested to be made and the Issuing Bank and each Revolving Credit Lender to issue and/or participate in Letters of Credit requested to be issued on the Closing Date is subject to the satisfaction on and as of the Closing Date of the following conditions precedent:

(a)Credit Agreement and Revolving Credit Notes.  The Administrative Agent shall have received (i) this Agreement, (A) executed and delivered by a duly authorized officer of the Borrower, with a counterpart for each Lender, and (B) executed and delivered by a duly authorized officer of the Administrative Agent and each Lender, (ii) for the account of each Lender, a Revolving Credit Note with each such Revolving Credit Note conforming to the requirements hereof and executed by a duly authorized officer of the Borrower.

(b)Other Loan Documents.  The Administrative Agent shall have received each of the Security Documents and other Loan Documents duly executed and delivered by each party thereto (including any stock certificates and undated stock powers ).  Any document (including without limitation UCC financing statements) required to be filed, registered or recorded in order to create, in favor of the Administrative Agent for the benefit of the Lenders, a perfected, first priority Lien (subject only to Permitted Liens), shall have been filed, registered or recorded and/or properly prepared for filing, registration or recording in each office in each jurisdiction in which such filings, registration and recordation are required to perfect such first priority security interests created by the Security Documents, and the Administrative Agent shall be satisfied that all such recordings and filings have been or will be completed promptly following the Closing Date and that all necessary filing, recording and other fees and all taxes and expenses related to such filings, registrations and recordings have been or will be paid in full by the Borrower.

(c)Loan Party Certificates.  The Administrative Agent shall have received a certificate of the Secretary or Assistant Secretary of the Borrower and the other Loan Parties certifying the resolutions of the board of directors of such Person and true and correct copies of the certificate or articles of incorporation, bylaws or other applicable governing documents of such Person and the signatures and incumbency of the officers of such Person authorized to sign the Loan Documents to which it is a party, and such certificates and attachments thereto shall be in form and substance satisfactory to the Administrative Agent.

(d)[INTENTIONALLY OMITTED]

(e)Fees.  Each of the Administrative Agent and the Lead Arranger shall have received all fees to be received by it individually or on behalf of the Lenders on the Closing Date pursuant to the Fee Letter.

(f)Legal Opinions.  The Administrative Agent shall have received the executed legal opinion(s) of Pepper Hamilton, LLP, counsel to the Borrower and the other Loan Parties and such other opinions (if any) as shall be required by the Administrative Agent.  Such opinion shall be addressed to the Lenders and the Administrative Agent and cover such matters incident to the transactions contemplated by this Agreement as the Administrative Agent may reasonably require.

(g)UCC Filing and Other Searches.  The Administrative Agent shall have received the results of (i) Uniform Commercial Code searches made with respect to each of the Parent, the Borrower, the other Loan Parties, together with copies of financing statements disclosed by such searches and (ii) such tax and judgment lien searches as the Administrative Agent shall reasonably request, and each of the foregoing searches shall disclose no Liens, except for Permitted Liens or, if unpermitted Liens are disclosed, the Administrative Agent shall have received satisfactory evidence of the release of such Liens.

(h)Insurance.  The Administrative Agent shall have received certificates of insurance with respect to the Parent’s, the Borrower’s and the other Loan Parties’ fire, casualty, liability and other insurance covering its respective property and business, including lender loss payee endorsements in favor of the Administrative Agent on Acord Form 27.

(i)Good Standing.  The Administrative Agent shall have received certificates of good standing, subsistence and/or status dated a recent date from the Secretary of State or appropriate authorities in the state of formation of each of the Borrower and the other Loan Parties.

(j)No Material Adverse Effect; Closing Certificate.  No Material Adverse Effect shall have occurred since June 30, 2010.  The Administrative Agent shall have received a certificate from the Borrower and the other Loan Parties, dated as of the Closing Date, and executed by a Responsible Officer of such party stating that, as of the Closing Date (i) all of the representations and warranties made by such party herein and in the other Loan Documents are true and correct in all material respects (except that representations and warranties that expressly relate to an earlier date are true and correct in all m aterial respects as of such date), (ii) no Default or Event of Default exists and (iii) no Material Adverse Effect has occurred since June 30, 2010.

(k)Governmental Approvals.  The Administrative Agent shall have received evidence that any necessary authorizations from any Governmental Authority for the consummation of the transactions contemplated hereby have been obtained.

(l)[INTENTIONALLY OMITTED].

(m)[INTENTIONALLY OMITTED].

(n)Compliance Certificate.  The Borrower shall have delivered to the Administrative Agent a Compliance Certificate demonstrating compliance with the covenants herein.

(o)Financial Statements and Projections.  The Borrower shall have delivered to the Administrative Agent and the Lenders (i) consolidated pro forma financial statements for the Parent and its Subsidiaries for the fiscal quarters ended March 31, 2010 and June 30, 2010 and (ii) consolidated financial projections on an annual basis for the 2010 fiscal year and for each fiscal year ending thereafter through and including the 2013 fiscal year .

(p)[INTENTIONALLY OMITTED].

(q)Principal Deposit Accounts.  The Borrower and the other Loan Parties shall have established their principal deposit accounts at PNC.

(r)Additional Matters.  All corporate and other proceedings, and all documents, instruments and other legal matters in connection with the transactions contemplated by this Agreement and the other Loan Documents shall be satisfactory in form and substance to the Administrative Agent, and the Administrative Agent shall have received such other documents and legal opinions in respect of any aspect or consequence of the transactions contemplated hereby or thereby as it shall reasonably request.

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4.2Conditions to Each Loan or Letter of Credit

The agreement of each Lender to make any Loan requested to be made by it and of the Issuing Bank and each Revolving Credit Lender to issue and/or participate in Letters of Credit requested to be issued on any date (including the Closing Date) is subject to the satisfaction of the following conditions precedent:

(a)Representations and Warranties.  Each of the representations and warranties made by the Borrower or any other Loan Party herein or under the other Loan Documents shall be true and correct in all material respects on and as of such date as if made on and as of such date (except to the extent that such representations and warranties relate expressly to an earlier date in which case such representations and warranties shall be true and correct in all material respects as of such earlier date).

(b)No Default.  No Default or Event of Default shall have occurred and be continuing on such date or after giving effect to the making of such Loan or issuing such Letter of Credit.

(c)No Material Adverse Effect.  At the time of making such Loan or issuing such Letter of Credit, no Material Adverse Effect shall have occurred and be continuing.

Each request by the Borrower for a Loan or Letter of Credit hereunder shall constitute a representation and warranty by the Borrower as of the date thereof that the conditions contained in this Section 4.2 have been satisfied.

4.3Closing

The closing (the “Closing”) of the transactions contemplated hereby shall take place at the offices of Ballard Spahr LLP, 1735 Market Street, Philadelphia, PA 19103, commencing at 10:00 A.M., Philadelphia time, on August 31, 2010, or such other place or date as to which the Administrative Agent, the Lenders and the Borrower shall agree.  The date on which the Closing shall be completed is referred to herein as the “Closing Date”.

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SECTION 5.  AFFIRMATIVE COVENANTS

The Borrower hereby agrees that, so long as the Revolving Credit Commitments remain in effect, any Note or Letter of Credit remains outstanding and unpaid, or any other amount is owing to any Lender or the Administrative Agent hereunder or under any other Loan Document, the Borrower shall and (except in the case of delivery of financial information, reports and notices) shall cause the Parent and each of its other Subsidiaries to:

5.1Furnishing Financial Statements

Furnish or cause to be furnished to the Administrative Agent:

(a)as soon as available, but in any event not later than 90 days (or such earlier date mandated by the SEC) after the close of each fiscal year of the Parent, a copy of the annual audit report for such year for the Parent and its consolidated Subsidiaries, including therein a consolidated balance sheet of the Parent and its consolidated Subsidiaries as at the end of such fiscal year, and related consolidated statements of income and retained earnings and changes in cash flows of the Parent and its consolidated Subsidiaries for such fiscal year, all in reasonable detail, prepared in accordance with GAAP applied on a basis consistently maintained throughout the period involved and with the prior year with such changes thereon as shal l be approved by the Parent’s independent certified public accountants, such financial statements to be certified by Grant Thornton LLPor other nationally recognized independent certified public accountants selected by the Parent and reasonably acceptable to the Administrative Agent, without a “going concern” or like qualification or exception or qualification arising out of the scope of the audit;

(b)as soon as available, but in any event not later than 45 days after the end of each fiscal quarter of the Parent (other than the last fiscal quarter), unaudited consolidated financial statements of the Parent and its consolidated Subsidiaries, including therein (i) a consolidated balance sheet of the Parent and its consolidated Subsidiaries as at the end of such fiscal quarter, (ii) the related consolidated statements of income and retained earnings of the Parent and its consolidated Subsidiaries, and (iii) the related consolidated statement of changes in cash flows of the Parent and its consolidated Subsidiaries all for the period from the beginning of such fiscal quarter to the end of such fiscal quarter and the portion of the fiscal year through the end of such quarter setting forth in each case in comparative form the corresponding figures for the like period of the preceding fiscal year; all in reasonable detail, prepared in accordance with GAAP applied on a basis consistently maintained throughout the period involved and with prior periods (except for the absence of footnotes and subject to year-end adjustments) and accompanied by a certificate of a Responsible Officer of the Parent stating that the financial statements fairly present the financial condition of the Parent and its consolidated Subsidiaries as of the date and for the periods covered thereby;

The financial statements required to be delivered pursuant to clauses (a) and (b) of this Section 5.1 shall be deemed to have been delivered on the date on which such report is posted on the website of the Securities and Exchange Commission at www.sec.gov and Borrower notifies Administrative Agent in writing thereof.

(c)concurrently with the delivery of:

(i)the financial statements referred to in subsection 5.1(a), a certificate of the Parent’s independent certified public accountants reporting on such financial statements stating that in making the examination necessary for certifying such financial statements no knowledge was obtained of any Event of Default under Section 6.1 hereof, except as specifically indicated;

(ii)the annual and quarterly financial statements referred to in subsections 5.1(a) and 5.1(b), respectively, a certificate of a Responsible Officer of the Borrower (each a “Compliance Certificate”) showing in detail the calculations demonstrating compliance with the financial covenants set forth in Section 6.1 together with a certificate of a Responsible Officer of the Borrower stating that, to his or her knowledge, the Borrower during such period has kept, observed, performed and fulfilled each and every covenant and condition contained in this Agreement and in the Notes and the other Loan Documents to which it is a party and that such officer has o btained no knowledge of any Default or Event of Default except as specifically indicated; if the Compliance Certificate shall indicate that such officer has obtained knowledge of a Default or Event of Default, such Compliance Certificate shall state what efforts the Borrower is making to cure such Default or Event of Default; and

(iii)the financial statements referred to in subsections 5.1(a) and 5.1(b), sufficient financial information to permit the Lenders to calculate Modified EBITDA, including with respect to any Person who has (or whose assets have) been acquired in a Permitted Acquisition and who is (or whose assets have been) owned for less than four (4) full fiscal quarters, calculations on a quarterly basis of the EBITDA attributable to such Person (or such assets) for the applicable period prior to such acquisition.

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(d)any reports, including management letters, promptly after their submittal to the Parent by its independent accountants in connection with any annual, interim or special audit;

(e)promptly, such additional financial and other information as the Administrative Agent or any Lender may from time to time reasonably request;

(f)promptly after the same are available, quarterly account statements with respect to each Unrestricted Investment Account demonstrating the amount of cash and/or Cash Equivalents maintained in such Unrestricted Investment Accounts by the Parent and/or its Subsidiaries during such quarter;

(g)promptly following the execution thereof, a copy of any letter of intent executed by the Borrower or any other Loan Party in respect of a proposed acquisition for which the proposed Consideration is $10,000,000 or more;

(h)any reports, notices or proxy statements generally distributed by the Parent to its stockholders on a date no later than the date supplied to such stockholders;

(i)simultaneously with the delivery of the financial statements required under subsection 5.1(a), but in any event on or before ninety (90) days after the end of each fiscal year, (i) a budget for the current fiscal year (and, if available, for the next fiscal year) approved by the board of directors of the Parent(each a “Budget”), and copies of any updates to such Budget prepared by or for any Loan Party and (ii) projections through the Revolving Credit Termination Date; and promptly upon request, such additional or updated Budgets, projections, reports (including inventory reports) a nd other information regarding the operations, business affairs and financial condition of the Borrower and the other Loan Parties as the Required Lenders may, from time to time, reasonably request;

(j)[INTENTIONALLY OMITTED].

(k)promptly after the same become publicly available, copies of all periodic, other reports, proxy statements or other materials filed by the Parent or any Subsidiary thereof with the SEC, or any Governmental Authority succeeding to any or all of the functions of the SEC, or with any national securities exchange, or distributed to its equityholders, as the case may be.

All balance sheets, statements and other information furnished pursuant hereto shall be prepared in accordance with GAAP, except for the absence of footnotes and subject to year-end adjustments in the case of the unaudited financial statements, and shall fairly set forth the consolidated financial condition of the Parent and its Subsidiaries and the results of their operations.  The Lenders shall have the right, from time to time, to discuss the Loan Parties’ affairs directly with the Parent’s independent certified public accountants after notice to the Borrower and the opportunity for the Borrower to be present at any such discussions.  The Administrative Agent and each Lender is authorized to show or deliver a copy of any financial statement or any other information relating to the business, operations or financial condition of the Parent and its Subsidiaries which may be furnished to any Lender or come to its attention pursuant to this Agreement or otherwise, to any regulatory body or agency having jurisdiction over such Lender and to any bank or other financial institution which is a present or potential participant with such Lender in the Loans and other extensions of credit hereunder, provided such bank or financial institution agrees to keep such information confidential on the terms hereof.

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5.2Books and Records

Maintain proper and complete books and records of account in which shall be set forth accurately and in accordance with GAAP, all of its dealings and transactions.

5.3Taxes

Pay when due all taxes, assessments, charges and levies imposed upon it or any of its properties or which it is required to withhold and pay over, and provide evidence of such payment to the Administrative Agent if requested, except where such taxes, assessments or charges shall be contested in good faith by appropriate proceedings and where adequate reserves therefor have been set aside on its books, provided that the Parent and its Subsidiaries shall pay or cause to be paid all such taxes, assessments, charges, and levies forthwith whenever foreclosure on any Lien that attaches (or security therefor) appears imminent.

5.4Corporate Existence and Rights; Compliance with Laws

Preserve and keep in full force and effect its corporate existence, rights, permits, patents, franchises, licenses, trademarks and trade names and other Intellectual Property and comply with any and all laws, regulations, rules or requirements of any federal agency or department and of any state, local or municipal government, agency or department which may at any time be applicable to it, except to the extent failure to do so would not reasonably be expected to have a Material Adverse Effect.

5.5Maintenance of Properties

Maintain all of its tangible property (except for obsolete property not yet disposed of) in good repair, working order and condition and, from time to time, make all appropriate and proper repairs, renewals, replacements, additions and improvements thereto, except to the extent failure to do so would not reasonably be expected to have a Material Adverse Effect.

5.6Performance and Compliance with Material Agreements

Perform and comply with each of the provisions of all Loan Documents and, except to the extent failure to do so would not otherwise cause an Event of Default or would not reasonably be expected to have a Material Adverse Effect, all other material agreements.

5.7Insurance

.  Carry at all times, in coverage, form and amount reasonably satisfactory to the Administrative Agent (and, in any event in such amounts and covering such risks as is consistent with sound business practice and other similarly situated companies), hazard insurance and business interruption coverage (with fire, extended coverage, vandalism, malicious mischief coverage and business interruption coverage and coverage against such other hazards as are customarily insured against by companies in the same or similar business), comprehensive general liability insurance, worker’s compensation insurance, comprehensive automobile liability insurance and such other insurance as may be required by the Loan Documents and as the Administrative Agent may from time to time reasonably require, and pay all premiums on the policies for suc h insurance when and as they become due and do all other things necessary to maintain such policies in full force and effect.  The Borrower shall from time to time upon request by the Administrative Agent or the Required Lenders, promptly furnish or cause to be furnished to the Administrative Agent or the Lenders evidence in form and substance satisfactory to the Administrative Agent or the Required Lenders, of the maintenance of all insurance required to be maintained by this Section 5.7 including, but not limited to, such originals or copies as the Administrative Agent or the Required Lenders may request of policies, certificates of insurance, riders and endorsements relating to such insurance and proof of premium payments.  The Borrower shall cause all hazard insurance policies and any policies insuring the inventory and equipment covered by the Security Agreement to provide, and the insurers issuing such policies to certify to the Lenders, that (a) the interest of the Administrat ive Agent shall be insured regardless of any breach or violation by the Parent or any Subsidiary thereof or the holder or owner of the policies of any warranties, declarations and conditions contained in such policies; (b) if such insurance be proposed to be canceled or materially changed for any reason whatsoever, such insurer will promptly notify the Administrative Agent and such cancellation or change shall not be effective as to the Administrative Agent for thirty (30) days after receipt by the Administrative Agent of such notice, unless the effect of such change is to extend or increase coverage under the policy; (c) the Administrative Agent and the Lenders will have the right at their election to remedy any default in the payment of premiums within thirty (30) days of notice from the insurer of such default; and (d) loss payments in each instance will be payable to the Administrative Agent as secured party, or otherwise as its or the Lenders’ interests may appear.  The Ad ministrative Agent, its officers, employees and authorized agents, are hereby irrevocably appointed attorneys-in-fact of the Borrower to endorse any draft or check which may be payable to the Administrative Agent, in order to collect the proceeds of such insurance covering the collateral and distribute the same as the Required Lenders may determine; provided that, if at the time of receipt of any such proceeds no Event of Default has occurred and is continuing, such proceeds shall be released to the Borrower to pay the costs of repairing, restoring or replacing the assets lost, damaged or destroyed.

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5.8Inspection; Collateral Audit

Permit any representative of the Administrative Agent and the Lenders to visit and inspect any of its properties, to examine its books of account and other records and files, to make copies thereof, and to discuss their affairs, business, finances and accounts with its officers and employees, all at such reasonable times and as often as the Administrative Agent or any Lender may reasonably request, provided that such inspections shall not unreasonably interfere with the conduct of the Loan Parties’ business. All reasonable costs incurred by the Administrative Agent and the Lenders in connection with up to two (2) such inspections conducted in any calendar year shall be paid by the Borrower; provided, however, the Borrower also shall pay all such costs in connection with any such inspections during the existence of a Default or Event of Default.  The inspections are solely for the protection of the Administrative Agent and the Lenders and no action or inaction of the Administrative Agent or the Lenders shall constitute any representation that the Borrower is in compliance with the terms of this Agreement or that the Administrative Agent or the Lenders approve of the Loan Parties’ affairs, business, finances or accounts.

5.9Leases and Mortgages

Pay all rent or other sums required by any lease or mortgage to which it is a party as the same becomes due and payable, duly perform and comply with all of its other obligations as tenant or mortgagor thereunder, except to the extent that any such obligation is the subject of a good faith dispute and adequate reserves have been set aside therefor, and keep all such leases in full force and effect, except to the extent the absence or loss of such lease would not reasonably be expected to have a Material Adverse Effect.

5.10Pay Indebtedness and Perform Other Covenants

Make full and timely payment of the principal of, and interest on, the Notes, the Reimbursement Obligations, the Commitment Fees and (except to the extent non-payment of such Indebtedness would not violate Section 7.1(f)) all other Indebtedness of the Loan Parties, whether now existing or hereafter arising, and duly comply with all covenants and agreements set forth in or required pursuant to any other agreement or document previously, concurrently or hereafter executed or delivered by the Loan Parties in connection with this Agreement, except that the Loan Parties may contest in good faith after making appropriate reserves therefor amounts owing in respect of Indebtedness other than Indebtedness arising under the Loan Documents.

5.11Notices

Promptly give notice to the Administrative Agent on behalf of the Lenders of:

(a)as soon as the Borrower has knowledge, the occurrence of any Default or Event of Default;

(b)any (i) default or event of default under any material Contractual Obligation of the Parent or any of its Subsidiaries or (ii) litigation, investigation or proceeding which may exist at any time between the Parent or any of its Subsidiaries and any Governmental Authority, which in either case, if not cured or if adversely determined, as the case may be, would reasonably be expected to have a Material Adverse Effect or result in a liability in excess of $500,000;

(c)any litigation or proceeding which could give rise to a liability of the Parent or any of its Subsidiaries of $500,000 or more and not covered by insurance as reasonably determined by the Borrower’s corporate counsel or in which injunctive or similar relief is sought;

(d)the occurrence or existence of a material default by any party, including the Parent or any of its Subsidiaries, to any material contract to which the Parent or a Subsidiary is a party, or the actual or threatened termination, revocation or non-renewal of any such material contract;

(e)entry of any order, judgment, decree or decision issued by any court, arbitrator or Governmental Authority in any proceeding to which the Parent or any of its Subsidiaries is a party and which would individually or in the aggregate reasonably be expected to have a Material Adverse Effect; and

(f)any other event which, to the Borrower’s knowledge, has had or would reasonably be expected to have a Material Adverse Effect.

Each notice pursuant to this subsection shall be accompanied by a statement of a Responsible Officer of the Borrower setting forth details of the occurrence referred to therein and stating what action the Borrower proposes to take with respect thereto.  Upon the request of the Administrative Agent, the Borrower shall send (or cause to be sent) to the Administrative Agent and/or the Lenders copies of all Federal, state, local and foreign tax returns and reports filed by the Parent or any of its Subsidiaries in respect of taxes measured by income.

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5.12Deposit Accounts

Maintain its principal domestic deposit accounts with PNC.

5.13ERISA

(a)  Furnish to the Administrative Agent (a) promptly and in any event within 30 days after it has knowledge that it or any Affiliate has incurred Withdrawal Liability, or that any Multiemployer Plan is in Reorganization or that any Reportable Event or Foreign Benefit Event has occurred with respect to any Employee Pension Plan or that PBGC has instituted or will institute proceedings under Title IV of ERISA to terminate any Employee Pension Plan or to appoint a trustee to administer any Employee Pension Plan, a statement setting forth the amount of such Withdrawal Liability, the details of the Reorganization, Reportable Event, Foreign Benefit Event or termination or appointment proceedings and the action which it (or the Multiemployer Plan sponsor or Employee Pension Plan sponsor if other t han the Parent) proposes to take with respect thereto, together with a copy of any notice of Withdrawal Liability or Reorganization given to the Parent or any Affiliate and a copy of the notice of such Reportable Event given to PBGC or a copy of the notice of such Foreign Benefit Event, in each case, if a copy of such notice is reasonably available to the Borrower or any of its Affiliates, (b) promptly after receipt thereof, a copy of any notice (i) the Parent or any of its Affiliates or the sponsor of any Employee Pension Plan receives from PBGC or the Internal Revenue Service which sets forth or proposes any negative action or determination with respect to such Employee Pension Plan, and (ii) the Parent, any of its Subsidiaries or the sponsor of any Foreign Benefit Plan receives from any Governmental Authority regulating such Foreign Benefit Plan which sets forth or proposes any action or determination with respect to such Foreign Benefit Plan, (c) promptly, and in any event within fift een (15) days after receipt thereof, a copy of any Adjusted Funding Target Attainment Percentage certification by an Employee Pension Plan actuary if such certification reflects an Adjusted Funding Target Attainment Percentage of less than 80%, and (d) promptly and in any event within fifteen (15) days of the date on which such certification should have been received, a notice of the failure to receive an actuarial certification of the Adjusted Funding Target Attainment Percentage.  The Borrower will promptly notify the Administrative Agent of any excise taxes which have been assessed against the Parent or any of its Subsidiaries or any of its Affiliates by (x) the Internal Revenue Service with respect to any Employee Pension Plan or Multiemployer Plan or (y) the applicable Government Authority regulating any Foreign Benefit Plan.  Within the time required for notice to the PBGC under Section 303(k)(4) of ERISA or 430(k)(4)(A) of the Code, the Borrower will notify the Admin istrative Agent of any Lien of which the Borrower has knowledge arising under Section 303(k) of ERISA or 430(k) of the Code in favor of any Employee Pension Plan.  The Borrower will promptly notify the Administrative Agent of the following events, and in any event within 30 days after the Borrower knows or has reason to know thereof: (i) a failure to make any required contribution to an Employee Pension Plan or a Foreign Benefit Plan, any Lien in favor of PBGC, a Plan or a Foreign Benefit Plan, or any withdrawal from, or the termination, Reorganization or Insolvency of, any Multiemployer Plan or (ii) assessment of liability under the Coal Industry Retiree Health Benefit Act of 1992.

5.14Environmental Laws.

(a)Comply with, and require compliance by all tenants and all subtenants, if any, with, all Environmental Laws and obtain and comply with and maintain, and require that all tenants and subtenants obtain and comply with and maintain, any and all licenses, approvals, registrations or permits required by Environmental Laws, except to the extent that failure to so comply or obtain or maintain such documents would not reasonably be expected to have a Material Adverse Effect;

(b)Comply with all lawful and binding orders and directives of all Governmental Authorities respecting Environmental Laws, except to the extent the failure to so comply would not reasonably be expected to have a Material Adverse Effect; and

(c)Defend, indemnify and hold harmless the Administrative Agent and the Lenders, and their respective Affiliates, employees, agents, advisors, officers, directors, successors and assigns (each, an “Indemnitee”) from and against any claims, demands, penalties, fines, liabilities, settlements, damages, costs and expenses of whatever kind or nature known or unknown, contingent or otherwise, arising out of, or in any way relating to any violation of or noncompliance with or liability under any Environmental Laws, or any orders, requirements or demands of Governmental Authorities related thereto which in each case relate to or arise in connection with the Paren t, any Subsidiaries thereof, any Property or any activities relating to any property or business of the Parent or any Subsidiaries thereof or the enforcement of any rights provided herein or in the other Loan Documents, including, without limitation, attorneys’ and consultants’ fees, response costs, investigation and laboratory fees, court costs and litigation expenses, except to the extent that any of the foregoing arise out of the gross negligence or willful misconduct of such Indemnitee.  This indemnity shall continue in full force and effect regardless of the termination of this Agreement and the payment of the Notes and other Obligations.

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5.15Notice and Joinder of New Subsidiaries

Notify the Administrative Agent as soon as practicable after acquiring or creating a new Subsidiary, and cause

(a)(i) any new Domestic Subsidiary to execute and deliver to the Administrative Agent (A) a Guaranty (or Joinder, as determined by the Administrative Agent) in form and substance acceptable to the Administrative Agent pursuant to which it shall guaranty all of the Obligations and (B) a Security Agreement (or Joinder, as determined by the Administrative Agent) in form and substance satisfactory to the Administrative Agent pursuant to which such Domestic Subsidiary shall grant a security interest to the Administrative Agent in its assets as additional Collateral for the Obligations and (ii) the owner of such Domestic Subsidiary to execute and deliver a Pledge Agreement (or Joinder as determined by the Administrati ve Agent) in form and substance acceptable to the Administrative Agent pursuant to which all of the Capital Stock in such Domestic Subsidiary shall be pledged to the Administrative Agent, for the benefit of the holders of the Obligations, as Collateral for the Obligations.

(b)any Domestic Subsidiary that is the owner of any new first-tier Foreign Subsidiary to execute and deliver to the Administrative Agent a Pledge Agreement (or Joinder as determined by the Administrative Agent) in form and substance reasonably acceptable to the Administrative Agent pursuant to which sixty-five percent (65%) of the issued and outstanding Capital Stock of such Foreign Subsidiary (to the extent owned by the Parent or a Domestic Subsidiary) shall be pledged to the Administrative Agent, for the benefit of the holders of the Obligations, as Collateral for the Obligations.

(c)in connection with any such Guaranties, Security Agreements, Pledge Agreements and/or Joinders, the Parent, the Borrower and/or the applicable Subsidiary or Subsidiaries to execute and deliver or cause to be executed and delivered such additional documentation as the Administrative Agent shall reasonably require, including without limitation, certificates similar to those referred to in subsection 4.1(c), opinions and stock certificates, if any, evidencing such Capital Stock (together with undated stock powers endorsed in blank).

5.16Anti-Terrorism Laws

Neither the Parent, the Borrower nor their Affiliates, Subsidiaries and agents shall (a) conduct any business or engage in any transaction or dealing with any Blocked Person, including the making or receiving of any contribution of funds, goods or services to or for the benefit of any Blocked Person, (b) deal in, or otherwise engage in any transaction relating to, any property or interests in property blocked pursuant to Executive Order No. 13224; or (c) engage in or conspire to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in Executive Order No. 13224 or the USA Patriot Act.  The Borrower shall deliver to the Administrative Agent any certification or other evidence requested from time to time by the Administrative Agent in it s sole discretion, confirming Borrower’s compliance with this Section 5.16.

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SECTION 6.  NEGATIVE COVENANTS

The Borrower hereby agrees that, so long as the Revolving Credit Commitments remain in effect, any Note or Letter of Credit remains outstanding and unpaid, or any other amount is owing to any Lender or the Administrative Agent hereunder or under any other Loan Document, the Borrower shall not, and shall not permit the Parent or any of its Subsidiaries to, directly or indirectly:

6.1Financial Covenants.

(a)Total Leverage Ratio.  Permit, as of the last day of any fiscal quarter, commencing with the fiscal quarter ending September 30, 2010, the Total Leverage Ratio to exceed 2.25 to 1.00:

(b)Interest Coverage Ratio.  Permit, as of the last day of any fiscal quarter, commencing with the fiscal quarter ending September 30, 2010, the Interest Charge Coverage Ratio to be less than 3.50 to 1.00.

6.2Limitation on Indebtedness

.  At any time incur, create, assume, or suffer to exist any Indebtedness except:

(a)amounts outstanding under the Loan Documents and Hedge Agreements with a Lender or an Affiliate thereof;

(b)purchase money Indebtedness on equipment purchased in the ordinary course of business and Capital Lease Obligations not exceeding, together with any purchase money Indebtedness or Capital Lease Obligations listed on Schedule 6.2, an aggregate principal amount at any time outstanding of $4,000,000;

(c)Indebtedness existing as of the date hereof described on Schedule 6.2 (including, except with respect to seller notes, any extensions or renewals or refinancings thereof provided there is no increase in the amount thereof or other significant change in the terms thereof);

(d)Indebtedness in an aggregate amount not to exceed $1,000,000 at any one time outstanding of a Person which becomes a Subsidiary after the Closing Date, provided that (i) such Indebtedness existed at the time such Person became a Subsidiary and was not created in anticipation of the acquisition, (ii) immediately after giving effect to the acquisition of such Person by the Parent or a Subsidiary, no Default or Event of Default shall have occurred and be continuing and (iii) the Borrower has complied with Section 5.15 hereof;

(e)earn-outs in connection with Permitted Acquisitions consummated after the date hereof (but not seller notes which, for any Permitted Acquisition consummated on or after the Closing Date, shall only be permitted to the extent that they constitute Subordinated Debt);

(f)unsecured Indebtedness of the Parent’s Subsidiaries in an aggregate principal amount not to exceed $500,000 at any time outstanding the proceeds of which are to be used for such Subsidiaries’ general corporate purposes;

(g)Subordinated Debt;

(h)subject to Section 6.6, Indebtedness owed to a Loan Party or any other Subsidiary by another Loan Party or any other Subsidiary;

(i)other Indebtedness in respect of letters of credit or bank guaranties issued for the account of Foreign Subsidiaries in an aggregate amount available to be drawn not to exceed $500,000 at any time outstanding;

(j)Guaranty Obligations incurred in the ordinary course of business by the Parent or any of its Subsidiaries of (i) obligations of any Loan Party or (ii) any Indebtedness of the Parent or any of its Subsidiaries permitted under this Section 6.2 (except (x) as regards Indebtedness under clause (c) above, only if and to the extent such Indebtedness was guaranteed on the Closing Date and (y) Subordinated Debt under clause (g) above); and

(k)Indebtedness relating to Hedge Agreements entered into for non-speculative purposes.

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6.3Limitation on Liens

Create, incur, assume or suffer to exist any Lien upon any of its property, assets or revenues, including, without limitation, the stock of any Subsidiary, whether now owned or hereafter acquired, except for (the following, collectively, “Permitted Liens”):

(a)Liens in favor of the Lenders or the Administrative Agent arising under the Loan Documents;

(b)The following, (i) if the validity or amount thereof is being contested in good faith by appropriate and lawful proceedings diligently conducted so long as levy and execution thereon have been stayed and continue to be stayed or (ii) if a final judgment is entered and such judgment is discharged within thirty (30) days of entry, and in either case they do not materially impair the ability of the Loan Parties to perform their obligations hereunder or under the other Loan Documents:

(A)Claims or Liens for taxes, assessments or charges due and payable and subject to interest or penalty, provided that the Loan Parties maintain such reserves or other appropriate provisions as shall be required by GAAP and pay all such taxes, assessments or charges forthwith upon the commencement of proceedings to foreclose any such Lien; and

(B)Claims or Liens upon, and defects of title to, real or personal property including any attachment of personal or real property or other legal process prior to adjudication of a dispute on the merits.

(c)liens for taxes not yet due or which are being contested in compliance with Section 5.3;

(d)carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like Liens arising in the ordinary course of business;

(e)pledges or deposits in connection with workers’ compensation, unemployment insurance and other social security or social welfare legislation;

(f)liens of landlords or of mortgagees of landlords arising by operation of law and deposits to secure the performance of leases in the ordinary course of business;

(g)deposits to secure the performance of bids, trade contracts (other than for borrowed money), leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature incurred in the ordinary course of business of the Loan Parties;

(h)easements, rights-of-way, restrictions and other similar encumbrances incurred in the ordinary course of business which, in the aggregate, are not substantial in amount and which do not interfere with the ordinary conduct of the business of the Loan Parties;

(i)Liens which were in existence on the date hereof and shown on Schedule 6.3 and extensions or replacements thereof;

(j)Liens on assets (other than inventory or receivables) of Persons which become Subsidiaries after the date of this Agreement, provided that such Liens existed at the time the respective corporations became a Subsidiary and were not created in anticipation thereof, provided that, (i) any such Lien does not by its terms cover any property or assets after the time such company becomes a Subsidiary which were not covered immediately prior thereto (ii) and the Borrower has complied with Section 5.15 hereof;

(k)Capital Leases and purchase money security interests as and to the extent permitted under this Agreement; and

(l)Liens securing reimbursement obligations under any letter of credit permitted by subsection 6.2(i), provided that such Liens attach solely to the assets of the Foreign Subsidiary to which such letter of credit relates;

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6.4Limitations on Fundamental Changes

Enter into any merger, consolidation or amalgamation, or liquidate, wind up or dissolve itself (or suffer any liquidation or dissolution), or convey, sell, lease, assign, transfer or otherwise dispose of, all or substantially all of its property, business or assets except:

(a)a Subsidiary of the Borrower may merge, consolidate or amalgamate into the Borrower so long as the Borrower is the surviving entity;

(b)a Subsidiary of the Parent may merge, consolidate or amalgamate into or with any Loan Party provided that the surviving entity is or becomes a Loan Party;

(c)a Non-Loan Party may merge, consolidate or amalgamate with or into any other Non-Loan Party;

(d)subject to Section 6.16, a Subsidiary of the Parent may sell, lease, transfer or otherwise dispose of any or all of its assets (upon voluntary liquidation or otherwise) to any other Loan Party;

(e)a Non-Loan Party may liquidate, wind up or dissolve itself or suffer any liquidation or dissolution;

(f)a Non-Loan Party may sell, lease, transfer or otherwise dispose of any or all of its assets (upon voluntary liquidation or otherwise) to any other Non-Loan Party;

(g)a merger permitted under Section 6.6; and

(h)the Merger; provided that, the Borrower complies with Section 5.15 and, after giving effect to the Merger, all Domestic Subsidiaries of the Parent are Loan Parties and their assets have been pledged to the Administrative Agent as security pursuant to a Security Agreement.

provided that, immediately after each such transaction and after giving effect thereto, the Borrower is in compliance with this Agreement and no Default or Event of Default shall be in existence or result from such transaction.

6.5Limitations on Sale of Assets

Convey, sell, lease, assign, transfer or otherwise dispose of any of its property, business or assets (including, without limitation, accounts receivables and leasehold interests), whether now owned or hereafter acquired, except:

(a)obsolete or worn out property disposed of in the ordinary course of business;

(b)the sale of inventory or other assets in the ordinary course of business;

(c)as permitted by Section 6.4;

(d)Permitted Liens;

(e)the abandonment of any patent, patent application, trademark, trademark application service mark or copyright that any Subsidiary of the Parent determines, in its commercial reasonable judgment, is no longer necessary or useful in any material respect in its business; and

(f)transfers of assets by any Loan Party to any Non-Loan Party, provided that such Loan Party receives cash consideration in an amount not less than the fair market value of such transferred assets.

This Section 6.5 shall not prohibit the Parent, the Borrower or any Subsidiary from purchasing, holding or acquiring any Investment that is a Permitted Investment.

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6.6Limitations on Acquisitions and other Investments

Purchase, hold or acquire beneficially any stock, other securities or evidences of indebtedness of, or make or permit any Investment (including in any other Person), except for Permitted Investments; provided that, no Permitted Acquisition (other than the Merger and the Tender Offer) shall be completed after the Closing Date unless prior to the 15th day before such completion (or, with respect to any Permitted Acquisition the Consideration for which is less than $10,000,000, within 30 days after such completion), the Borrower has provided to the Administrative Agent (a) audited, if available, and, if not, unaudited annual financial statements of the Person being acquired (or whose assets are being acquired) for the two (2) fiscal years (or such lesser period of such Person’s existence), (b) unaudited financial statements f or any interim fiscal period(s), prior to the consummation of such proposed acquisition, and (c) such additional independent third party due diligence reports and field audits and/or examinations, as the Required Lenders may request, all in form and substance satisfactory to the Required Lenders; provided that, the Borrower shall use good faith efforts to obtain three (3) years of financial statements of the Person being acquired (or whose assets are being acquired).

6.7Limitation on Distributions

At any time make (or incur any liability to make) or pay any Distribution (whether in cash or property or obligations of a Subsidiary of the Parent) in respect of the Parent or any Subsidiary thereof (other than a Distribution payable to a direct Subsidiary of the Parent or from a Subsidiary of a direct Subsidiary of the Parent to another Subsidiary of a direct Subsidiary of the Parent); except that, so long as no Default or Event of Default shall have occurred and be continuing, a direct Subsidiary of the Parent shall be permitted to pay dividends to the Parent, to pay professional fees, franchise and income taxes and other ordinary course of business operating expenses  incurred by the Parent solely in its capacity as parent corporation of the Borrower, any other direct Subsidiary of the Parent and the Subsidiaries thereof.

6.8Transactions with Affiliates

Except as expressly permitted in this Agreement, directly or indirectly enter into any transaction or arrangement whatsoever or make any payment to or otherwise deal with any Affiliate other than a Loan Party, except, as to all of the foregoing pursuant to the reasonable requirements of the Loan Parties’ businesses and upon fair and reasonable terms no less favorable to the Loan Parties than would be obtained in a comparable arm’s length transaction with a Person not an Affiliate.

6.9Sale and Leaseback

Enter into any arrangement with any Person providing for the leasing by any Subsidiary of the Parent of real or personal property which has been or is to be sold or transferred by any Subsidiary of the Parent to such Person or to any other Person to whom funds have been or are to be advanced by such Person on the security of such property or rental obligations of such Subsidiary.

6.10Continuation of or Change in Business

Engage in any business either directly or through any Subsidiary except for businesses in which Subsidiaries of the Parent are engaged in on the date of this Agreement and any business activities directly related to such existing businesses.

6.11Limitation on Negative Pledge

Enter into any agreement with any Person other than the Administrative Agent and the Lenders which prohibits or limits the ability of the Parent or its Subsidiaries to create, incur, assume or suffer to exist any Lien upon any of its or their properties, assets or revenues, whether now owned or hereafter acquired; provided, that, any Subsidiary of the Parent may enter into such agreement in connection with any Lien permitted by subsection 6.2(b) of this Agreement, when such prohibition or limitation is by its terms effective only against the assets subject to such Lien.

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6.12Limitation on Optional Prepayment of Indebtedness

Make any optional payment or prepayment or redemption, defeasance or purchase of any Subordinated Debt, earn-outs and any other Indebtedness evidenced by any seller notes; or amend, modify or change, or consent or agree to any amendment, modification or change to, any of the terms of any Subordinated Debt or any seller notes or earn-out arrangements (other than any amendment, modification or change of a nature which (a) would extend the maturity or reduce the amount of any payment of principal thereof, (b) would reduce the rate or extend the date for payment of interest thereon or (c) is not material and, in any event, will not involve accelerating the date or increasing the amount of any payment or prepayment.  Notwithstanding anything in this Section 6.12 to the contrary, any Subsidiary of the Parent shall be permitted to set off amounts owed by them under any seller note against indemnification obligations owed to them by the payee of such note in accordance with the terms thereof, and such setoff shall not be deemed an optional payment or prepayment or redemption, defeasance or purchase of any Indebtedness or earn-out payment under this Section 6.12.  Promptly following any such set-off, the Borrower shall provide the Administrative Agent with notice of such set-off setting forth in reasonable detail the amount of such set-off and the resulting principal amount then outstanding under such seller note after giving effect to such set-off.

6.13Use of Proceeds

Directly or indirectly apply any part of the proceeds of the Loans to the purchasing or carrying of any “margin stock” within the meaning of Regulation U of the Board of Governors of the Federal Reserve System, or any regulations, interpretations or rulings thereunder.

6.14Fiscal Year

Permit any fiscal year of the Parent to end on a day other than December 31.

6.15Clauses Restricting Subsidiary Distributions

Enter into or suffer to exist or become effective any (a) consensual encumbrance or restriction or (b) injunction or other order imposing a restriction, on the ability of any Subsidiary of the Borrower or any Subsidiary of any other direct Subsidiary of the Parent to (i) make Distributions in respect of any Capital Stock of such Subsidiary held by, or pay any Indebtedness owed to, the Borrower, any other direct Subsidiary of the Parent or any other Subsidiary of the Parent, (ii) make loans or advances to, or other Investments in, the Borrower, any other direct Subsidiary of the Parent or any other Subsidiary of the Parent or (iii) transfer any of its assets to the Borrower, any other direct Subsidiary of the Parent or any other Subsidiary of the Parent, except for any restrictions existing under the Loan Documents .

6.16Limitation on Activities of the Parent

Permit the Parent to (a) own any property other than Capital Stock of the Borrower, the Capital Stock of any other Subsidiary in connection with a Permitted Acquisition and property ancillary thereto, (b) engage in any business other than (i) business incidental to its ownership of Capital Stock of the Borrower and any other Subsidiary permitted hereunder, and (ii) to undertake Permitted Acquisitions and become party to relevant documentation in connection therewith, or (c) have any liabilities other than  liabilities incurred in the ordinary course of business and pursuant to Permitted Acquisitions.

6.17No Misrepresentations or Material Nondisclosure

Furnish the Administrative Agent or any Lender any certificate or other document that will contain any untrue statement of a material fact or that will omit to state a material fact necessary in order to make it not misleading in light of the circumstances under which it was furnished.

6.18Kenexa SA PTE Ltd. (South Africa)

Permit, at any time, Kenexa SA PTE Ltd. (South Africa) and its Subsidiaries to have assets with a fair market value, in the aggregate, in excess of $100,000.

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SECTION 7.  EVENTS OF DEFAULT

7.1Events of Default

Each of the following shall constitute an event of default (an “Event of Default”):

(a)The Borrower fails to pay on or before the date when due, whether on demand or otherwise, any principal of the Notes or any Reimbursement Obligation, or fails to pay within five (5) days after the date when due, any interest thereon or any other Indebtedness (including fees and expenses) to the Administrative Agent or the Lenders under this Agreement or the other Loan Documents.

(b)The Borrower fails to comply with or perform as and when required or to observe any of the terms, conditions or covenants contained in Sections 5.1, 5.7, 5.11, 5.15 or Section 6 of this Agreement.

(c)The Borrower or any Loan Party fails to comply with or perform as and when required any of the terms, covenants, or conditions of this Agreement or any other Loan Document (other than as provided in subsections (a) and (b) above) to be complied with, performed or observed by the Borrower or such Loan Party and such failure shall continue unremedied for a period of 30 days after the earlier of (i) notice thereof from the Administrative Agent or any Lender to the Borrower and (ii) any Responsible Officer of the Borrower becoming aware thereof.

(d)Any financial statement or any representation or warranty of the Borrower or any Loan Party made herein or in any other Loan Document or in any report, certificate or other document furnished under or in connection with this Agreement proves to have been false or misleading in any material respect on or as of the date made or deemed made.

(e)There occurs a default or event of default under (a) any of the other Loan Documents or any other document or instrument delivered to the Administrative Agent by the Borrower or any other Loan Party or (b) any Hedge Agreement entered into with a Lender or Affiliate thereof, and such default or event of default continues unremedied beyond the grace period, if any, provided therein.

(f)The Parent or any Subsidiary thereof shall (i) default in the payment of any principal of or interest on or any other amount payable on any Indebtedness beyond the period of grace (not to exceed 30 days), if any, provided in the instrument or agreement under which such Indebtedness was created and the aggregate amount of such Indebtedness in respect of which such default or defaults shall have occurred is at least $500,000; or (ii) default in the observance or performance of any other agreement or condition relating to any such Indebtedness in excess of $500,000 contained in any instrument or agreement evidencing, securing or relating thereto, or any other event shall occur or condition exist, the effect of which defau lt or other event or condition is to cause, or to permit the holder or holders of such Indebtedness (or a trustee or agent on behalf of such holder or holders) to cause, with the giving of notice if required, such Indebtedness to become due and payable prior to its stated maturity.

(g)(i) The Parent or any Subsidiary thereof makes an assignment for the benefit of its creditors or a composition with its creditors, or is unable or admits in writing its inability to pay its debts as they mature, or files a petition in bankruptcy, or commences a federal bankruptcy proceeding in which an order for relief or such other court order or statutory provision which authorizes the case to proceed is entered against it, or is adjudicated insolvent or bankrupt, or petitions or applies to any tribunal for the appointment of any custodian, receiver, liquidator or trustee of or for it or any substantial part of its properties or assets, or commences any proceeding relating to it under any bankruptcy, reorganization, arran gement, readjustment of debt, receivership, dissolution or liquidation law or statute of any jurisdiction, whether now or hereafter in effect; or there is commenced against the Parent or any Subsidiary thereof any such proceeding which shall remain undismissed for a period of 60 days, or an order for relief, order, judgment or decree approving the petition in any such proceeding is entered; or (ii) the Parent or any Subsidiary thereof by any act or failure to act indicates its consent to, approval of or acquiescence in any such proceeding or in the appointment of any custodian, receiver, liquidator or trustee of or for it or any substantial part of its properties or assets, or suffers any such appointment to continue undischarged or unstayed for a period of 60 days; or (iii) the Parent or any Subsidiary thereof takes any action for the purpose of effecting any of the foregoing.

(h)One or more judgments or decrees shall be entered against the Parent or any Subsidiary thereof involving in the aggregate a liability (to the extent not covered by insurance as to which the insurer does not dispute coverage thereof) of $500,000or more and all such judgments or decrees shall not have been vacated, discharged, settled, satisfied or paid, or stayed or bonded pending appeal, within 30 days from the entry thereof.

(i)Any of the Loan Documents shall cease to be legal, valid and binding agreements enforceable against a Loan Party executing the same in accordance with the respective terms thereof or shall in any way be terminated (except in accordance with its terms) or become or be declared ineffective or inoperative or shall in any way be challenged and thereby deprive or deny the Lenders and the Administrative Agent of the intended benefits thereof or they shall thereby cease substantially to have the rights, titles, interests, remedies, powers or privileges intended to be created thereby.

(j)Any attachment or execution process is issued against 10% or more of the assets of the Parent or any Subsidiary thereof; or any material uninsured damage to, or loss, theft or destruction of, any of the collateral subject to the Security Documents occurs which would reasonably be expected to result in a Material Adverse Effect.

(k)The suspension by the Parent or any other Loan Party of all or any significant part of its business operations or the loss, suspension, revocation or failure of the Parent or any other Loan Party to renew any license or permit now held or hereafter acquired by the Parent or any other Loan Party, which loss, suspension, revocation or failure to file would reasonably be expected to have a Material Adverse Effect.

(l)(A) (i) Any Employee Pension Plan is terminated within the meaning of Title IV of ERISA, or (ii) a trustee is appointed by the appropriate United States District Court to administer any Employee Pension Plan, or (iii) PBGC institutes proceedings to terminate any Employee Pension Plan or to appoint a trustee to administer any Employee Pension Plan, or (iv) any Reportable Event occurs which the Required Lenders determine in good faith indicates a substantial likelihood that an event described in (i), (ii) or (iii) above will occur, or (v) the Parent or any of its Affiliates incurs any Withdrawal Liability with respect to any Multiemployer Plan, or (vi) any Multiemployer Plan enters Reorganization , and (B) with respect to events described in (i)-(iv) above, only if, (1) the benefit liabilities (within the meaning of Section 4001(a)(16) of ERISA) exceed the market value of the assets in the fund under the Employee Pension Plan by 5% or more of the Parent’s or its Affiliate’s tangible net worth or (2) the Adjusted Funding Target Attainment Percentage for the Employee Pension Plan is less than 80% or (3) there occurs an Accumulated Funding Deficiency or Unpaid Minimum Required Contribution in excess of $250,000 with respect to any Employee Pension Plan or (4) there occurs any Accumulated Funding Deficiency or Unpaid Minimum Required Contribution with respect to any Employee Pension Plan and the Parent or any of its Affiliates fails to correct such Accumulated Funding Deficiency or Unpaid Minimum Required Contribution prior to the end of the correction period within the meaning of Section 4971(c) of the Code, or (5) there arises a Lien under Section 303(k) of ERI SA or 430(k) of the Code in favor of any Employee Pension Plan.

(m)Any Change of Control shall occur.

(n)There is a Material Adverse Effect.

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7.2Remedies

If an Event of Default specified in subsection 7.1(g) with respect to the Borrower shall occur and be continuing, the Revolving Credit Commitments (including the obligation of the Issuing Bank to issue Letters of Credit) shall automatically and immediately terminate, and the Loans hereunder (with accrued interest thereon) and all other amounts owing under this Agreement, the Notes and the other Loan Documents shall automatically and immediately become due and payable (including, without limitation, all Letter of Credit Obligations, whether or not the beneficiaries of the then outstanding Letters of Credit shall have presented the documents required thereunder).  If any other Event of Default shall occur and be continuing, with the consent of the Required Lenders, the Administrative Agent may, or upon the written request of the R equired Lenders, the Administrative Agent shall (a) by notice to the Borrower declare the Revolving Credit Commitments to be terminated forthwith, whereupon such Revolving Credit Commitments and the obligations of the applicable Lenders to make Revolving Credit Loans and the obligation of the Issuing Bank to issue Letters of Credit, shall immediately terminate; (b) by notice of default to the Borrower, declare the Loans hereunder (with accrued interest thereon) and all other amounts owing under this Agreement, the Notes and the other Loan Documents to be due and payable forthwith, whereupon the same shall immediately become due and payable (including, without limitation, all Letter of Credit Obligations, whether or not the beneficiaries of the then outstanding Letters of Credit shall have presented the documents required thereunder); (c) exercise such remedies as may be available to the Administrative Agent and the Lenders hereunder or under the Security Documents, the other Loan Documents or otherwise at la w or equity; and/or (d) by notice to the Borrower require the Borrower to, and the Borrower shall thereupon, deposit in a non-interest bearing account with the Administrative Agent, as cash collateral for its obligations under this Agreement, the Notes and the Applications, an amount equal to the aggregate Letter of Credit Coverage Requirement, and the Borrower hereby pledges to the Administrative Agent and the Lenders, and grants to the Administrative Agent and the Lenders a security interest in, all such cash as security for such obligations.  Amounts held in such cash collateral account shall be applied by the Administrative Agent to the payment of drafts drawn under the Letters of Credit or, with the consent of the Issuing Bank, to other Obligations, and the unused portion thereof after all the Letters of Credit shall have expired or been fully drawn upon, if any, shall be applied to repay the other Obligations.  After all the Letters of Credit shall have expired or been fully drawn u pon, all Reimbursement Obligations shall have been satisfied and all other Obligations shall have been paid in full, the balance, if any, in such cash collateral account shall be returned to the Borrower (or such other Person or Persons as may be lawfully entitled thereto).  The Borrower shall execute and deliver to the Administrative Agent, for the account of the Issuing Bank and the Letter of Credit Participants, such further documents and instruments as the Administrative Agent may request to evidence the creation and perfection of the within security interest in such cash collateral account.  Except as expressly provided above in this Section, presentment, demand, protest and all other notices of any kind are hereby expressly waived.

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SECTION 8.  HE ADMINISTRATIVE AGENT

8.1Appointment

Each Lender hereby irrevocably designates and appoints PNC as administrative agent of such Lender, in each case under this Agreement and the other Loan Documents, and each such Lender irrevocably authorizes PNC, in such capacity to take such action on its behalf under the provisions of this Agreement and the other Loan Documents and to exercise such powers and perform such duties as are expressly delegated to the Administrative Agent by the terms of this Agreement and the other Loan Documents, together with such other powers as are reasonably incidental thereto.  Notwithstanding any provision to the contrary elsewhere in this Agreement and the other Loan Documents, the Administrative Agent shall not have any duties or responsibilities, except those expressly set forth herein or therein, or any fiduciary relationship with any Len der, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement and the other Loan Documents or otherwise exist against the Administrative Agent.  PNC agrees to act as the Administrative Agent on behalf of the Lenders to the extent provided in this Agreement and the other Loan Documents.

8.2Delegation of Duties

The Administrative Agent may execute any of its duties under this Agreement and the other Loan Documents by or through agents or attorneys-in-fact and shall be entitled to engage and pay for the advice and services of counsel concerning all matters pertaining to such duties.  The Administrative Agent shall not be responsible to the Lenders for the negligence or misconduct of any agents or attorneys-in-fact selected by it with reasonable care.

8.3Exculpatory Provisions

The Lenders hereby agree that neither the Administrative Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or Affiliates shall be (a) liable for any action lawfully taken or omitted to be taken by it or such Person under or in connection with this Agreement or the other Loan Documents (except for its or such Person’s own gross negligence or willful misconduct) or (b) responsible in any manner to any of the Lenders for any recitals, statements, representations or warranties made by the Borrower, any other party or any officer thereof contained in this Agreement, the other Loan Documents or in any certificate, report, statement or other document referred to or provided for in, or received by the Administrative Agent under or in connection with, this Agreement or the other Loan Documents or for th e value, validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement, the Notes or the other Loan Documents or for any failure of the Borrower or any other party to perform its or their obligations hereunder or thereunder.  The Administrative Agent shall not be under any obligation to any Lender to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, this Agreement or the other Loan Documents, or to inspect the properties, books or records of the other parties to the Loan Documents (or any of them).

8.4Reliance by Administrative Agent

The Administrative Agent shall be entitled to rely, and shall be fully protected in relying, upon any Note, writing, resolution, notice, consent, certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype message, statement, order or other document or conversation believed by it to be genuine and correct and to have been signed, sent or made by the proper Person or Persons and upon advice and statements of legal counsel (including, without limitation, counsel to the Borrower or any other party to a Loan Document), independent accountants and experts selected by the Administrative Agent.  The Administrative Agent may deem and treat the payee of any Note as the owner thereof for all purposes unless a written notice of assignment, negotiation or transfer thereof shall have been filed with the Administrative Ag ent.  The Administrative Agent shall be fully justified in failing or refusing to take any action under this Agreement or the other Loan Documents unless it shall first receive such advice or concurrence of the Required Lenders (or such other percentage of the Lenders as shall be required hereunder) as it deems appropriate and it shall first be indemnified to its satisfaction by the Lenders against any and all liability and expense which may be incurred by it by reason of taking or continuing to take any such action.  The Lenders hereby agree that the Administrative Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement, the Notes or the other Loan Documents in accordance with a request of the Required Lenders (or such other percentage of Lenders as shall be required hereunder), and such request and any action taken or failure to act pursuant thereto shall be binding upon all the Lenders and all future holders of the Notes.

8.5Notice of Default

The Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of any Default or Event of Default hereunder unless it has received notice from a Lender, the Borrower or any other Loan Party referring to this Agreement, describing such Default or Event of Default and stating that such notice is a “notice of default”.  In the event that the Administrative Agent receives such a notice, the Administrative Agent shall promptly give notice thereof to the Lenders.  The Administrative Agent shall take such action with respect to such Default or Event of Default as shall be reasonably directed by the Required Lenders (or such other percentage of the Lenders as shall be required hereunder); provided that unless and until the Administrative Agent shall have received such directions, the Adm inistrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of Default as it shall deem advisable in the best interests of the Lenders.

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8.6Non-Reliance on Administrative Agent and Other Lenders

Each Lender expressly acknowledges that neither the Administrative Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or Affiliates has made any representations or warranties to it and that no act by the Administrative Agent hereinafter taken, including any review of the affairs of the Borrower and/or any other party to the Loan Documents, shall be deemed to constitute any representation or warranty by the Administrative Agent to any Lender.  Each Lender represents to the Administrative Agent that it has, independently and without reliance upon the Administrative Agent or any other Lender, and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, operations, property, financial and other condition and creditworthiness of th e Borrower and the other parties to the Loan Documents and made its own decision to make its Loans hereunder, issue and/or participate in Letters of Credit and enter into this Agreement and each other Loan Document to which it is a party.  Each Lender also represents that it will, independently and without reliance upon the Administrative Agent or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not taking action under this Agreement and the other Loan Documents, and to make such investigation as it deems necessary to inform itself as to the business, operations, property, financial and other condition and creditworthiness of the Borrower and the other Loan Parties.  Except for notices, reports and other documents expressly required to be furnished to the Lenders by the Administrative Agent hereunder, the Administrative Agent shall not have any duty or res ponsibility to provide any Lender with any credit or other information concerning the business, operations, property, condition (financial or otherwise), prospects or creditworthiness of the Borrower or any other party to the Loan Documents which may come into the possession of the Administrative Agent or its officers, directors, employees, agents, attorneys-in-fact or Affiliates.

8.7Indemnification

The Lenders agree to indemnify the Administrative Agent in its agent capacity hereunder and under the other Loan Documents (to the extent not reimbursed by the Borrower and without limiting the obligation, if any, of the Borrower to do so) ratably in accordance with each Lender’s respective Revolving Credit Commitment Percentage, from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever which may at any time (including, without limitation, at any time following the payment of the Notes) be imposed on, incurred by or asserted against the Administrative Agent in any way relating to or arising out of this Agreement, the other Loan Documents, or any documents contemplated by or referred to herein or therein or the transactions con templated hereby or thereby or any action taken or omitted by the Administrative Agent under or in connection with any of the foregoing; provided that no Lender shall be liable for the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting solely from the Administrative Agent’s gross negligence or willful misconduct.  The agreements in this Section 8.7 shall survive the payment of the Notes and all other amounts payable hereunder.

8.8Administrative Agent in Its Individual Capacity

The Administrative Agent and its Affiliates may make loans to, accept deposits from and generally engage in any kind of business with the Borrower or any other party to the Loan Documents as though the Administrative Agent were not an agent hereunder.  With respect to its Loans made or renewed by it and any Notes issued to it, the Administrative Agent shall have the same rights and powers under this Agreement and the other Loan Documents as any Lender and may exercise the same as though it were not the administrative agent hereunder and under the other Loan Documents, and the terms “Lender” and “Lenders” shall include the Administrative Agent in its individual capacity.

8.9Release of Liens

Upon the sale or other transfer of any assets of the Borrower or any other Loan Party in compliance with Section 6.5, and so long as it is not aware that any Default or Event of Default shall exist, the Administrative Agent will take such action as may be necessary to evidence the release of the Administrative Agent’s Lien on such assets, including delivering to the Borrower or such other Loan Party, at the cost of the Borrower, appropriate collateral releases.

8.10Successor Administrative Agent

The Administrative Agent may resign as administrative agent hereunder and under the other Loan Documents upon 30 days’ notice to the Lenders and the Borrower.  If the Administrative Agent shall resign, then the Required Lenders shall appoint from among the Lenders a successor administrative agent for the Lenders, which appointment shall be subject to (unless a Default or Event of Default shall exist) the approval of the Borrower (which approval shall not be unreasonably withheld or delayed) and the appointee, whereupon such successor administrative agent shall succeed to the rights, powers and duties of the Administrative Agent and the term “Administrative Agent” shall mean such successor administrative agent effective upon its appointment and the former Administrative Agent’s rights, powers and duties sh all be terminated, without any other or further act or deed on the part of such former Administrative Agent or any of the other parties to this Agreement or the other Loan Documents or any holders of the Notes.  After any retiring Administrative Agent’s resignation, the provisions of this Article 8 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was an Administrative Agent under this Agreement and the other Loan Documents.

8.11USA Patriot Act

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

8.12Beneficiaries

Except as expressly provided herein, the provisions of this Section 8 are solely for the benefit of the Administrative Agent and the Lenders, and the Borrower and the other Loan Parties shall not have any right to rely on or enforce any of the provisions hereof.  In performing its functions and duties under this Agreement and the other Loan Documents, the Administrative Agent shall act solely as administrative agent of the Lenders and does not assume and shall not be deemed to have assumed any obligation toward or relationship of agency or trust with or for the Borrower or any of the other Loan Parties.

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SECTION 9.  MISCELLANEOUS

9.1Amendments and Waivers

                                                 (a)Subject to the remaining provisions of this Section 9.1, the Required Lenders, or the Administrative Agent with the consent of the Required Lenders, and the Borrower (or, in the case of the other Loan Documents, the relevant parties thereto) may from time to time enter into amendments, extensions, supplements and replacements to and of this Agreement and the other Loan Documents to which they are par ties, and the Required Lenders may from time to time waive compliance with a provision of any of the Loan Documents.  Subject to the remaining provisions of this Section 9.1, no amendment, extension, supplement, replacement or waiver shall be effective unless it is in writing and is signed by the Required Lenders or the Administrative Agent with the consent of the Required Lenders, and the Borrower (or, in the case of the other Loan Documents, the relevant parties thereto).  Each waiver shall be effective only for the specific instance and for the specific purpose for which it is given.

(b)The foregoing notwithstanding, no such amendment, extension, supplement, replacement or waiver shall, directly or indirectly, without the consent of all the Lenders:

(i)change the Revolving Credit Commitments (except as expressly provided in Section 2.9) or the principal amount of the Loans which may be outstanding hereunder;

(ii)reduce any interest rate hereunder (other than to waive the Default Rate) or any of the fees due hereunder or under any of the other Loan Documents (other than fees to the Administrative Agent, which shall require the consent of the Borrower and the Administrative Agent to change);

(iii)postpone any scheduled payment date of principal, interest or fees hereunder or under any of the other Loan Documents (excluding mandatory principal prepayment of the Loans);

(iv)release all or substantially all of the Lenders’ security interest in the Collateral securing the Obligations;

(v)change the definition of “Required Lenders”;

(vi)release or discharge, or consent to any release or discharge of (A) the Borrower as borrower under the Loan Documents or (B) a Guarantor as guarantor (other than in connection with a sale of such Guarantor in a transaction permitted hereunder); or permit the Borrower or any Affiliate to assign to another Person any of its obligations under the Loan Documents;

(vii)amend this Section 9.1; or

(viii)change Section 2.15 in a manner that would alter the pro rata sharing provisions required thereby.

(c)The foregoing notwithstanding, no such amendment, extension, supplement, or replacement shall amend, modify or otherwise affect the rights or duties of the Administrative Agent or the Issuing Bank hereunder or under any other Loan Document without the prior written consent of the Administrative Agent or the Issuing Bank, as the case may be.

(d)Any waiver or amendment, supplement or modification permitted hereunder shall apply equally to each of the Lenders and shall be binding upon the Borrower, the Lenders, the Administrative Agent and all future holders of the Notes.  In the case of any waiver, the Borrower, the Lenders and the Administrative Agent shall be restored to their former position and rights hereunder and under the other Loan Documents, and any Default or Event of Default waived shall be deemed to be cured and not continuing; but no such waiver shall extend to any subsequent or other Default or Event of Default, or impair any right consequent thereon.

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9.2Notices

All notices, requests and demands to or upon the respective parties hereto to be effective shall be in writing (including by electronic transmission, telecopy transmission or posting on a secured web site), and, unless otherwise expressly provided herein, shall be deemed to have been duly given or made when delivered by hand, or three days after being deposited in the mail, postage prepaid, or the next Business Day if sent by reputable overnight courier, postage prepaid, for delivery on the next Business Day, or, in the case of telecopy notice, when received during normal business hours, or in the case of electronic transmission, when received and in the case of posting on a secured web site, upon receipt of (i) notice of such posting and (ii) rights to access such web site, addressed as follows in the case of the Borrower, the Administrative Agent and the Issuing Bank, and as set forth in Schedule I or in its Assignment and Assumption in the case of the other parties hereto, or to such other address as may be hereafter notified by the respective parties hereto and any future holders of the Notes:

If to the Borrower:	Kenexa Technology, Inc. 650 East Swedesford Road Wayne, PA  19087 Attention:  Don Volk, Chief Financial Officer Telecopy:  (610) 971-2576 and Attention:  Cynthia Pyle Dixon, Esq. Telecopy:  (610) 971-2576
	with a copy to:
	Pepper Hamilton LLP 3000 Logan Square 18th and Arch Streets Philadelphia, PA  19103 Attention:  Barry M. Abelson, Esq. Telecopy:  (215) 981-4750

provided that failure to send a copy of such notice to Pepper Hamilton LLP shall in no way affect, limit or invalidate any notice sent to the Borrower or the exercise of any of the Administrative Agent’s or the Lenders’ rights or remedies pursuant to a notice sent to the Borrower;

If to the Administrative Agent or the Issuing Bank:	PNC Bank, National Association 1000 Westlakes Drive, Suite 200 Berwyn, PA  19312 Attention:  Daniel C. Takoushian Telecopy:  (610) 725-5799
	and
	PNC Bank, National Association Agency Services PNC Firstside Center 500 First Avenue, 4th Floor Pittsburgh, PA  15219 Attention:  Lisa Pierce Telecopy:  (412) 762-8672

provided (a) any notice, request or demand to or upon the Administrative Agent, the Issuing Bank or the Lenders pursuant to Sections 2.3, 2.4, 2.9 and 2.10 shall not be effective until received and (b) any notice of a Default or Event of Default hereunder shall be sent by telecopy or reputable overnight courier.

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9.3No Waiver; Cumulative Remedies

No failure to exercise and no delay in exercising, on the part of the Administrative Agent, the Issuing Bank or any Lender, any right, remedy, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.  The rights, remedies, powers and privileges herein provided are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law.

9.4Survival of Representations and Warranties

All representations and warranties made hereunder and in any document, certificate or statement delivered pursuant hereto or in connection herewith shall survive the execution and delivery of this Agreement, the Notes and the other Loan Documents.

9.5Payment of Expenses and Taxes

The Borrower agrees (a) to pay or reimburse the Administrative Agent for all of its reasonable out-of-pocket costs and expenses incurred in connection with the development, preparation and execution of, and the syndication and administration of, this Agreement, the Notes, the other Loan Documents and any other documents executed and delivered in connection herewith or therewith, and the consummation of the transactions contemplated hereby and thereby, including, without limitation, the reasonable fees and disbursements of counsel, (b) to pay or reimburse the Administrative Agent for all of its reasonable out-of-pocket costs and expenses incurred in connection with the performance of or any amendment, supplement or modification or proposed amendment, supplement or modification to this Agreement, the Notes and the other Loan Documents and a ny other documents executed and delivered in connection therewith, including without limitation, the reasonable fees and disbursements of counsel, (c) pay or reimburse each Lender and the Administrative Agent for all its reasonable costs and expenses incurred in connection with the enforcement or preservation of any rights under this Agreement, the Notes, the other Loan Documents and any such other documents, including, without limitation, reasonable fees and disbursements of counsel, (d) to pay, indemnify, and hold each Lender and the Administrative Agent harmless from, any and all recording and filing fees and any and all liabilities with respect to, or resulting from any delay in paying, stamp, excise and other similar taxes, if any, which may be payable or determined to be payable in connection with the execution and delivery of, or consummation of any of the transactions contemplated by, or any amendment, supplement or modification of, or any waiver or consent under or in respect of, this Agreement , the Notes, the other Loan Documents and any such other documents, and (e) to pay, indemnify, and hold each Lender, the Administrative Agent and each of their respective Affiliates and the officers, directors, employees, agents and advisors of such Persons and such Affiliates (the “Indemnified Parties”) harmless from and against any and all other liabilities, obligations, losses, damages, penalties, actions (whether sounding in contract, in tort or on any other ground), judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever with respect to the execution, delivery, enforcement, performance and administration of or in any other way arising out of or relating to, this Agreement, the Notes, the other Loan Documents, or any such other documents contemplated by or referred to herein or therein or any action taken by any Lender or the Administrative Agent with respect to the foregoing (all the foregoing, collectively, the “indemnified liabilities”), provided, that the Borrower shall have no obligation hereunder to any Indemnified Party with respect to indemnified liabilities arising from the gross negligence or willful misconduct of such Indemnified Party.  The agreements in this subsection shall survive repayment of the Notes and all other amounts payable hereunder.

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9.6Successors and Assigns

(a)Whenever in this Agreement any of the parties hereto is referred to, such reference shall be deemed to include the successors and permitted assigns of such party; and all covenants, promises and agreements by or on behalf of the Borrower, the Administrative Agent or the Lenders that are contained in this Agreement shall bind and inure to the benefit of its respective successors and assigns.  The Borrower may not assign or transfer any of its rights or obligations under this Agreement or the other Loan Documents without the prior written consent of each Lender.

(b)Each Lender may, in accordance with applicable law, sell to any Lender or Affiliate thereof and, with the consent of the Borrower (except when any Event of Default exists or if the sale is to a Lender or an Affiliate of a Lender) and the Administrative Agent (which consents shall not be unreasonably withheld or delayed, and provided that the Borrower shall be deemed to have consented if it does not object to the assignment within five (5) Business Days after having received notice thereof), to one or more other banks or financial institutions (each, a “Purchasing Lender”) all or a part of its interests, rights and obligations under this Agreement, the N otes and the other Loan Documents (including all or a portion of its Revolving Credit Commitment and the Loans at the time owing to it and the Notes held by it); provided, however, that (i) so long as no Event of Default shall exist and be continuing, such assignment shall be in an amount not less than $1,000,000 (or such lesser amount as the Borrower (unless an Event of Default shall exist) and the Administrative Agent shall agree in their sole discretion), unless the sum of such assigning Lender’s Revolving Credit Exposure plus Unused Revolving Credit Commitment is less than $1,000,000 in which case such assigning Lender may transfer all, but not less than all, of its interests hereunder and (ii) the parties to each such assignment shall execute and deliver to the Administrative Agent and the Borrower for its acceptance (to the extent required) and recording in the Registe r an Assignment and Assumption, together with the Notes subject to such assignment and, except for assignments by a Lender to one of its Affiliates, a processing and recordation fee of $3,500.  Upon acceptance and recording pursuant to paragraph (e) of this Section 9.6, from and after the effective date specified in the applicable Assignment and Assumption, which effective date shall be at least five Business Days after the receipt thereof by the Administrative Agent and the Borrower (unless otherwise agreed by the Administrative Agent), (A) such Purchasing Lender shall be a party hereto and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement and (B) the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all or the remaining portion of an assig ning Lender’s rights and obligations under this Agreement and the other Loan Documents, such Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of subsections 2.12, 2.13, 2.14, 5.14(c) and 9.5 (to the extent that such Lender’s entitlement to such benefits arose out of such Lender’s position as a Lender prior to the applicable assignment).  Such Assignment and Assumption shall be deemed to amend this Agreement to the extent, and only to the extent, necessary to reflect the addition of such Purchasing Lender and the resulting amounts and percentages held by the Lenders arising from the purchase by such Purchasing Lender of all or a pro rata portion of the rights and obligations of such assigning Lender under this Agreement, the Notes and the other Loan Documents.

(c)By executing and delivering an Assignment and Assumption, the assigning Lender thereunder and the Purchasing Lender thereunder shall be deemed to confirm to and agree with each other and the other parties hereto as follows:  (i) such assigning Lender warrants that it is the legal and beneficial owner of the interest being assigned thereby, free and clear of any adverse claim and that its commitment, and the outstanding balances of its Loans, without giving effect to assignments thereof which have not become effective, are as set forth in such Assignment and Assumption, (ii) except as set forth in (i) above, such assigning Lender makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with this Agreement or the other Loan Documents, or the execution, legality, validity, enforceability, genuineness, sufficiency or value of this Agreement, the other Loan Documents or any other instrument or document furnished pursuant hereto or thereto, or the financial condition of the Borrower, the Parent, any other party, or any Subsidiary thereof or the performance or observance by the Borrower, any other Loan Party or any other party of any of its obligations under this Agreement or the other Loan Documents or any other instrument or document furnished pursuant hereto or thereto; (iii) such Purchasing Lender represents and warrants that it is legally authorized to enter into such Assignment and Assumption; (iv) such Purchasing Lender confirms that it has received a copy of this Agreement, together with copies of the most recent financial statements delivered pursuant to Section 5.1 and such other documents and information as it has deem ed appropriate to make its own credit analysis and decision to enter into such Assignment and Assumption; (v) such Purchasing Lender will independently and without reliance upon the Administrative Agent, such assigning Lender or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under this Agreement and the other Loan Documents; (vi) such Purchasing Lender appoints and authorizes the Administrative Agent to take such action as administrative agent on its behalf and to exercise such powers under this Agreement and the other Loan Documents as are delegated to the Administrative Agent by the terms hereof or thereof, together with such powers as are reasonably incidental thereto; and (vii) such Purchasing Lender agrees that it will perform in accordance with their terms all the obligations which by the terms of this Agreement and the other Loan Documents are required to be performed by it as a Lender including, if it is organized under the laws of a jurisdiction outside the United States, its obligation pursuant to Section 2.13 to deliver the forms prescribed by the Internal Revenue Service of the United States certifying as to the Purchasing Lender’s exemption from United States withholding taxes with respect to all payments to be made to the Purchasing Lender under this Agreement.

(d)The Administrative Agent shall maintain at its offices a copy of each Assignment and Assumption and the names and addresses of the Lenders, and the commitments of, and principal amount of the Loans owing to, each Lender pursuant to the terms hereof from time to time (the “Register”).  The entries in the Register shall be conclusive in the absence of manifest error and the Borrower, the Administrative Agent and the Lenders may treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement.  The Register shall be available for inspection by the Borrower and any Lender at any reasonable time and from time to time upon reasonable prior notice.

(e)Upon its receipt of a duly completed Assignment and Assumption executed by an assigning Lender and a Purchasing Lender (and in the case of a Purchasing Lender that is not then a Lender or an Affiliate thereof, by the Borrower (unless an Event of Default shall then exist) and the Administrative Agent) together with the Note or Notes subject to such assignment and the processing and recordation fee referred to in paragraph (b) above, the Administrative Agent shall promptly (i) accept such Assignment and Assumption, (ii) record the information contained therein in the Register and (iii) give notice thereof to the Lenders.  Within five Business Days after receipt of notice, the Borrower, at its own expense, shall execute and deliver to the Administrative Agent, in exchange for the surrender of the original Revolving Credit Note or Revolving Credit Notes (A) a new Revolving Credit Note, to the order of such Purchasing Lender in the appropriate amounts assumed and (B) if the assigning Lender has retained an interest hereunder, the applicable Note or Notes in the appropriate amount(s).  Such new Note(s) shall be dated the date of the surrendered Note(s) which such new Note(s) replace and shall otherwise be in substantially the form of Exhibit A-1.  Canceled Notes shall be returned to the Borrower.

(f)Each Lender may, in accordance with applicable law,  sell participations to any Lender or Affiliate thereof and to one or more banks or other Persons (each a “Participant”), in each case in any Loan owing to such Lender, any Note held by such Lender, any commitment of such Lender, or any other interest of such Lender hereunder and under the other Loan Documents, provided, however, that (i) such Lender’s obligations under this Agreement to the other parties to this Agreement shall remain unchanged, (ii)
60;such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations, (iii) such Lender shall remain the holder of any such Note for all purposes under this Agreement and the other Loan Documents, (iv) the Borrower, the Lenders and the Administrative Agent shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement and the other Loan Documents, (v) in any proceeding under the Bankruptcy Code, such Lender shall be, to the extent permitted by law, the sole representative with respect to the obligations held in the name of such Lender, whether for its own account or for the account of any Participant and (vi) such Lender shall retain the sole right to approve, without the consent of any Participant, any amendment, modification or waiver of any provision of this Agreement or the Notes held by such Lender or any other Loan Document, other than with respect to the mat ters described in clauses (i) through (viii) of subsection 9.1(b).

(g)If amounts outstanding under this Agreement and the Notes are due or unpaid, or shall have been declared or shall have become due and payable upon the occurrence of an Event of Default, each Participant shall be deemed to have the right of set-off in respect of its participating interest in amounts owing under this Agreement and any Note to the same extent as if the amount of its participating interest were owing directly to it as a Lender under this Agreement or any Note, provided that in purchasing such participation such Participant shall be deemed to have agreed to share with the Lenders the proceeds thereof as provided in Section 9.7  The Borrower al so agrees that each Participant shall be entitled to the benefits of subsections 2.12, 2.13, 2.14, 5.14(c) and 9.5 with respect to its participation in the commitments and the Loans outstanding from time to time; provided, that no Participant shall be entitled to receive any greater amount pursuant to such subsections than the assigning Lender would have been entitled to receive in respect of the amount of the participation transferred by such assigning Lender to such Participant had no such transfer occurred.

(h)If any Participant of a Lender is organized under the laws of any jurisdiction other than the United States or any state thereof, the assigning Lender, concurrently with the sale of a participating interest to such Participant, shall cause such Participant (i) to represent to the assigning Lender (for the benefit of the assigning Lender and the other Lenders), the Administrative Agent and the Borrower that under applicable law and treaties no taxes will be required to be withheld by the Administrative Agent, the Borrower or the assigning Lender with respect to any payments to be made to such Participant in respect of its participation in the Loans and Letters of Credit and (ii) to agree (for the benefit of the assignin g Lender, the other Lenders, the Administrative Agent and the Borrower) that it will deliver the tax forms and other documents required to be delivered pursuant to subsection 2.13(b) and comply from time to time with all applicable U.S. laws and regulations with respect to withholding tax exemptions.

(i)Notwithstanding any other provision contained in this Agreement or any other Loan Document to the contrary, any Lender may, without obtaining any consents from any of the parties hereto, at any time (i) assign all or any portion of the Loans or Notes held by it to any Federal Reserve Bank or the United States Treasury as collateral security pursuant to Regulation A of the Board of Governors of the Federal Reserve System and any Operating Circular issued by such Federal Reserve Bank and (ii) in the case of a Lender that is or owns, controls or serves as originator for a fund, trust or similar entity, assign or pledge all or any portion of the Loans or Notes held by it to a trustee under any indenture to which such Lende r is a party or to the lenders to such Lender for collateral security purposes, provided that any payment in respect of such assigned Loans or Notes made by the Borrower to or for the account of the assigning or pledging Lender in accordance with the terms of this Agreement shall satisfy the Borrower’s obligations hereunder in respect to such assigned Loans or Notes to the extent of such payment.  No such assignment shall release the assigning Lender from its obligations hereunder.

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9.7Adjustments; Set-off

                                                (a)  Except as otherwise expressly provided herein, if any Lender (a “benefited Lender”) shall at any time receive any payment of all or part of its Loans or the Reimbursement Obligations owing to it, or interest thereon, or receive any collateral in respect thereof (whether voluntarily or involuntarily, by set-off, pursuant to events or proceedings of the nature referred to in subsection 7.1(g), or otherwise), in a greater proportion than any such payment to or collater al received by any other Lender, if any, in respect of such other Lender’s Loans or the Reimbursement Obligations owing to it, or interest thereon, such benefited Lender shall purchase for cash from the other Lenders such portion of each such other Lender’s Loans or the Reimbursement Obligations owing to it, or shall provide such other Lenders with the benefits of any such collateral, or the proceeds thereof, as shall be necessary to cause such benefited Lender to share the excess payment or benefits of such collateral or proceeds ratably with each of the Lenders; provided, however, that if all or any portion of such excess payment or benefits is thereafter recovered from such benefited Lender, such purchase shall be rescinded, and the purchase price and benefits returned, to the extent of such recovery, but without interest.  The Borrower agrees that each Le nder so purchasing a portion of another Lender’s Loans may exercise all rights of payment (including, without limitation, rights of set-off) with respect to such portion as fully as if such Lender were the direct holder of such portion.

(b)In addition to any rights and remedies of the Lenders provided by law, upon the occurrence and during the continuance of an Event of Default, each Lender shall have the right, without prior notice to the Borrower, any such notice being expressly waived by the Borrower to the extent permitted by applicable law, upon any amount becoming due and payable by the Borrower hereunder or under the Notes or the other Loan Document (whether at the stated maturity, by acceleration or otherwise) to set-off and appropriate and apply against such amount any and all deposits (general or special, time or demand, provisional or final), in any currency, and any other credits, indebtedness or claims, in any currency, in each case whether direct or indirect, absolute or contingent, matured or unmatured, at any time held or owing by such Lender to or for the credit or the account of the Borrower.  Each Lender agrees promptly to notify the Borrower and the Administrative Agent after any such set-off and application made by such Lender, provided that the failure to give such notice shall not affect the validity of such set-off and application.

9.8Counterparts

This Agreement may be executed by one or more of the parties to this Agreement on any number of separate counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument.  A set of the copies of this Agreement signed by all the parties shall be lodged with the Borrower and the Administrative Agent.

9.9Severability

Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

9.10Integration

This Agreement and the other Loan Documents represent the agreement of the parties hereto with respect to the subject matter hereof, and there are no promises, undertakings, representations or warranties by the Administrative Agent or any Lender relative to the subject matter hereof not expressly set forth or referred to herein or in the other Loan Documents.

9.11GOVERNING LAW

THIS AGREEMENT AND THE NOTES, AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT AND THE NOTES, SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE COMMONWEALTH OF PENNSYLVANIA.

9.12Confidentiality

Each of the Lenders severally agrees that it will use reasonable precautions to keep confidential, in accordance with its customary procedures for handling confidential information of the same nature any non-public information supplied to it by the Borrower or any other Loan Party pursuant to the Loan Documents; provided that nothing herein shall prevent any Lender from disclosing any such information (a) to the Administrative Agent or any other Lender, (b) to any prospective assignee or participant in connection with any assignment or participation (or proposed assignment or participation) of Loans or commitments permitted by this Agreement so long as such assignee or participant is notified as to the confidential nature of such information and agrees to keep such information confidential, (c) to its employees, directors, agents, attorneys, accountants and other professional advisors, rating agencies, and funding sources, (d) upon the request or demand of any Governmental Authority having jurisdiction over such Lender, (e) in response to any order of any court or other Governmental Authority or as may otherwise be required pursuant to any Requirement of Law, (f) which has been publicly disclosed other than in breach of this Agreement or (g) in connection with the exercise of any remedy hereunder or under the Notes or other Loan Documents.

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9.13Submission To Jurisdiction; Waivers

.  The Borrower hereby irrevocably and unconditionally:

(a)submits for itself and its property in any legal action or proceeding relating to this Agreement, the Notes or the other Loan Documents, or for recognition and enforcement of any judgment in respect thereof, to the non-exclusive general jurisdiction of the courts of the Commonwealth of Pennsylvania, the courts of the United States of America for the Eastern District of Pennsylvania, and appellate courts from any thereof;

(b)consents that any such action or proceeding may be brought in such courts and waives any objection that it may now or hereafter have to the venue of any such action or proceeding in any such court or that such action or proceeding was brought in an inconvenient court and agrees not to plead or claim the same;

(c)waives and hereby acknowledges that it is estopped from raising any objection based on forum non conveniens, any claim that any of the above-referenced courts lack proper venue or any objection that any of such courts lack personal jurisdiction over it so as to prohibit such courts from adjudicating any issues raised in a complaint filed with such courts against the Borrower concerning this Agreement or the other Loan Documents;

(d)acknowledges and agrees that the choice of forum contained in this Section 9.13 shall not be deemed to preclude the enforcement of any judgment obtained in any forum or the taking of any action under the Loan Documents to enforce the same in any appropriate jurisdiction;

(e)agrees that service of process in any such action or proceeding may be effected by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, to the Borrower at its address set forth in Section 9.2 or at such other address of which the Administrative Agent shall have been notified pursuant thereto;

(f)agrees that nothing herein shall affect the right to effect service of process in any other manner permitted by law or shall limit the right to sue in any other jurisdiction; and

(g)waives, to the maximum extent not prohibited by law, any right it may have to claim or recover in any legal action or proceeding referred to in this subsection any special, exemplary or punitive or consequential damages.

9.14Acknowledgments

The Borrower hereby acknowledges that:

(a)it has been advised by counsel in the negotiation, execution and delivery of this Agreement, the Notes and the other Loan Documents;

(b)neither the Administrative Agent nor any Lender has any fiduciary relationship to the Borrower or any other party to the Loan Documents (or any of them) and the relationship hereunder between the Administrative Agent and Lenders, on the one hand, and the Borrower and its Affiliates parties to the Loan Documents, on the other hand, is solely that of debtor and creditor; and

(c)no joint venture exists among the Borrower and its Affiliates parties to the Loan Documents (or any of them) and the Lenders or the Administrative Agent.

9.15USA PATRIOT ACT

Each Lender that is subject to the requirements of the USA Patriot Act hereby notifies the Borrower and the other Loan Parties that pursuant to the requirements of the USA Patriot Act, it is required to obtain, verify and record information that identifies the Borrower and such other Loan Parties, which information includes the name and address of the Borrower and such other Loan Parties and other information that will allow such Lender to identify the Borrower and such other Loan Parties in accordance with the USA Patriot Act.

9.16WAIVERS OF JURY TRIAL

THE BORROWER, THE ADMINISTRATIVE AGENT AND EACH LENDER HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT, THE NOTES OR ANY OTHER LOAN DOCUMENT AND FOR ANY MANDATORY COUNTERCLAIM THEREIN.

[Signature Pages to Follow]

58

IN WITNESS WHEREOF, the parties hereto, by their officers thereunto duly authorized, have executed this Agreement as of the day and year first above written.

KENEXA TECHNOLOGY, INC.

By: /s/ Donald F. Volk

Name:  Donald F. Volk

Title:    Chief Financial Officer

PNC BANK, NATIONAL ASSOCIATION, as Administrative Agent, Issuing Bank and a Lender

By: /s/ Daniel Takoushian

Name: Daniel Takoushian

Title: S.V.P.

59

EX-99.1 5 ex99-1.htm JOINT FILING AGREEMENT

Exhibit 99.1

SCHEDULE 13D JOINT FILING AGREEMENT

The undersigned hereby agree as follows:

Each of them is individually eligible to use the Schedule 13D to which this Exhibit is attached, and such Schedule 13D is filed on behalf of each of them; and

Each of them is responsible for the timely filing of such Schedule 13D and any amendments thereto, and for the completeness and accuracy of the information concerning such person contained therein; but none of them is responsible for the completeness or accuracy of the information concerning the other person making the filing, unless such person knows or has reason to believe that such information is inaccurate.

Date: September 9, 2010

KENEXA CORPORATION

/s/ Nooruddin S. Karsan

Signature

Name: Nooruddin S. Karsan

Title: Chief Executive Officer

SPIRIT MERGER SUB, INC.

/s/ Donald F. Volk

Signature

Name: Donald F. Volk

Title: President

-----END PRIVACY-ENHANCED MESSAGE-----

EX-99.1

Exhibit 99.1

SCHEDULE 13D JOINT FILING AGREEMENT

The undersigned hereby agree as follows:

Each of them is individually eligible to use the Schedule 13D to which this Exhibit is attached, and such Schedule 13D is filed on behalf of each of them; and

Each of them is responsible for the timely filing of such Schedule 13D and any amendments thereto, and for the completeness and accuracy of the information concerning such person contained therein; but none of them is responsible for the completeness or accuracy of the information concerning the other person making the filing, unless such person knows or has reason to believe that such information is inaccurate.

Date: September 9, 2010

KENEXA CORPORATION

/s/ Nooruddin S. Karsan

Signature

Name: Nooruddin S. Karsan

Title: Chief Executive Officer

SPIRIT MERGER SUB, INC.

/s/ Donald F. Volk

Signature

Name: Donald F. Volk

Title: President