8-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(D) OF

THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (date of earliest event reported):

July 21, 2003 (July 21, 2003)

IMPCO TECHNOLOGIES, INC.

(Exact name of registrant as specified in its charter)

Delaware

(State or other jurisdiction of

incorporation or organization)

001-15143	91-1039211
(Commission File Number)	(I.R.S. Employer Identification No.)

16804 Gridley Place

Cerritos, California 90703

(Address of Principal Executive Offices) (ZIP Code)

(562) 860-6666

(Registrant’s telephone number, including area code)

INFORMATION TO BE INCLUDED IN THE REPORT

Item 5. Other Events

On July 18, 2003, IMPCO Technologies, Inc. (“Impco” or the “Registrant”) entered into a Loan and Security Agreement (the “Security Agreement”), by and among Impco, LaSalle Business Credit, LLC (“LaSalle”), and other financial institutions which from time to time become parties to the Security Agreement. In connection with the Security Agreement, Impco executed a Revolving Promissory Note (the “Revolving Note”) payable to the order of LaSalle in the principal amount of $12,000,000.00. The Revolving Note is payable in full on July 18, 2006.

On July 18, 2003, Impco entered into a Securities Purchase Agreement (the “Purchase Agreement”) with Bison Structured Equity Partners, LLC (“Bison”) whereby Impco agreed to sell to Bison, and Bison agreed to buy from Impco, a senior subordinated promissory note (the ”Note”). The principal amount of the Note is $20,000,000 and is due on July 18, 2007. The total consideration paid in exchange for the Note is $17,250,000. Under the Purchase Agreement, Impco also agreed to sell, and Bison agreed to buy, a warrant (the “Warrant”) to purchase 500,000 shares of Impco Common Stock.

These transactions were funded and closed on July 21, 2003. Impco announced these transactions in the press release attached as Exhibit 99.1.

Item 7. Financial Statements and Exhibits

(c) Exhibits

Exhibit Number	Description
10.70	Revolving Promissory Note, dated as of July 18, 2003, executed by the Registrant in favor of LaSalle Business Credit, LLC.
10.71	Loan and Security Agreement, dated as of July 18, 2003, between the Registrant and LaSalle Business Credit, LLC.
10.72	Securities Purchase Agreement, dated as of July 18, 2003, between the Registrant and Bison Structured Equity Partners, LLC.
10.73	Pledge Agreement, dated as of July 18, 2003, between the Registrant and Bison Structured Equity Partners, LLC.
10.74	Warrant Agreement, dated as of July 18, 2003, between the Registrant and Bison Structured Equity Partners, LLC.
10.75	Senior Secured Subordinated Promissory Note, dated as of July 18, 2003, executed by the Registrant in favor of Bison Capital Structured Equity Partners, LLC.
99.1	Press Release, dated July 21, 2003.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

IMPCO TECHNOLOGIES, INC.

/s/ ROBERT M. STEMMLER

Robert M. Stemmler

Chief Executive Officer

DATE: July 29, 2003

INDEX TO EXHIBITS

Exhibit Number	Description
10.70	Revolving Promissory Note, dated as of July 18, 2003, executed by the Registrant in favor of LaSalle Business Credit, LLC.
10.71	Loan and Security Agreement, dated as of July 18, 2003, between the Registrant and LaSalle Business Credit, LLC.
10.72	Securities Purchase Agreement, dated as of July 18, 2003, between the Registrant and Bison Structured Equity Partners, LLC.
10.73	Pledge Agreement, dated as of July 18, 2003, between the Registrant and Bison Structured Equity Partners, LLC.
10.74	Warrant Agreement, dated as of July 18, 2003, between the Registrant and Bison Structured Equity Partners, LLC.
10.75	Senior Secured Subordinated Promissory Note, dated as of July 18, 2003, executed by the Registrant in favor of Bison Capital Structured Equity Partners, LLC.
99.1	Press Release, dated July 21, 2003.

EX-10.70

Exhibit 10.70

REVOLVING PROMISSORY NOTE

$12,000,000	New York
	July    , 2003

FOR VALUE RECEIVED, IMPCO TECHNOLOGIES, INC., a Delaware corporation, having its principal place of business located at 16804 Gridley Place, Cerritos, California 90703 (the “Maker”), promises to pay to the order of LASALLE BUSINESS CREDIT, LLC, having an office at 135 South LaSalle Street, Chicago, Illinois 60603 (together with any other holder hereof, the “Lender”), on the Maturity Date hereinafter defined, or such earlier date as is provided for in the Loan Agreement hereinafter referred to, the lesser of: (a) the principal sum of TWELVE MILLION AND 00/100 DOLLARS ($12,000,000), or (ii) the aggregate amount of all Loans as shall be advanced from time to time by the Lender to the Borrower, pursuant to the terms of the Loan Agreement, together with interest on the unpaid principal hereof at the rate and in the manner provided in this Note and in the Loan Agreement.

This Note is one of the Notes referred to in the Loan and Security Agreement dated of event date herewith (as amended, modified or supplemented from time to time, the “Loan Agreement”) among the Maker, the Lender, as Agent and as a lender and the other lenders from time to time party thereto, is secured in the manner provided therein, may be prepaid only upon and subject to the terms and conditions thereof and is entitled to all of the benefits thereof. All capitalized terms used in this Note which are defined in the Loan Agreement and not otherwise defined herein, shall have the respective meanings ascribed thereto in the Loan Agreement.

Without limiting any provision contained in the Loan Agreement, each advance and each other amount outstanding under the Loan Agreement and this Note shall bear interest at a fluctuating rate of interest per annum equal to one percent (1%) above the Prime Rate, and be payable on the earliest of: (a) the first day of each month (for the immediately preceding month), computed through the last calendar day of the preceding month, (b) the occurrence of an Event of Default in consequence of which the Lender elects to accelerate the maturity and payment of the Liabilities, or (c) termination of the Loan Agreement pursuant to the terms thereof. Upon and after the occurrence of an Event of Default and during the continuation thereof the principal amount of this Note shall bear interest at a rate per annum equal to the rate of interest then in effect plus two percent (2%), and shall be payable upon demand.

Unless accelerated or otherwise due and payable prior thereto in accordance with the terms of the Loan Agreement, the entire principal amount, interest accrued and unpaid, and all fees, costs, expenses, charges and other amounts due under the Loan Agreement, this Note and the Other Documents shall be due and payable in full on July     , 2006 (the “Maturity Date”).

All principal and interest shall be paid to Lender at the address provided in the Loan Agreement.

Upon the occurrence of any Event of Default, the Lender shall have all of its rights and remedies provided in the Loan Agreement and the Other Documents, including, without

limitation, the right to declare the principal amount of and accrued interest on this Note to be declared immediately due and payable.

MAKER HEREBY WAIVES ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING WHICH PERTAINS DIRECTLY OR INDIRECTLY TO THIS NOTE, THE LOAN AGREEMENT, ANY OF THE OTHER AGREEMENTS IN CONNECTION WITH THE LOANS PROVIDED FOR HEREWITH, THE COLLATERAL, AND ANY OTHER MATTER OR CONDUCT WHICH, IN ANY WAY DIRECTLY OR INDIRECTLY, ARISES OUT OF OR RELATES TO THE RELATIONSHIP BETWEEN MAKER AND LENDER.

Maker hereby waives demand, presentment, protest and notice of nonpayment. No extension of time for payment or delay in enforcement hereof nor any renewal of this Note or substitution or release of any collateral or mortgage or release of any party, with or without notice, shall release the obligation of any maker, guarantor, endorser or other accommodation party to the Lender of this Note, or shall operate as a waiver of any of the rights of the Lender of this Note, No delay by the Lender of this Note in the exercise of any right or remedy hereunder shall preclude other or further exercise thereof or the exercise of any right or remedy.

No provision of this Note may be changed, modified, amended, waived or released, unless it is in writing and signed by Maker and the Lender.

THE PROVISIONS OF THIS NOTE SHALL BE GOVERNED AND CONTROLLED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK AS TO INTERPRETATION, ENFORCEMENT, VALIDITY, CONSTRUCTION, EFFECT, AND IN ALL OTHER RESPECTS, INCLUDING, WITHOUT LIMITATION, THE LEGALITY OF THE INTEREST RATE AND OTHER CHARGES AND AMOUNTS DUE UNDER THIS NOTE AND THE LOAN AGREEMENT.

MAKER IRREVOCABLY AGREES THAT, SUBJECT TO LENDER’S SOLE AND ABSOLUTE ELECTION, ALL ACTIONS OR PROCEEDINGS IN ANY WAY, MANNER OR RESPECT, ARISING OUT OF OR FROM OR RELATED TO THIS NOTE, ANY OTHER AGREEMENTS CONTEMPLATED HEREBY OR RELATED HERETO, OR THE COLLATERAL THEREFOR SHALL BE LITIGATED IN COURTS HAVING SITUS WITHIN THE CITY OF NEW YORK, STATE OF NEW YORK. MAKER HEREBY CONSENTS AND SUBMITS TO THE JURISDICTION OF ANY LOCAL, STATE OR FEDERAL COURTS LOCATED WITHIN SAID CITY AND STATE. MAKER HEREBY WAIVES ANY RIGHT IT MAY HAVE TO TRANSFER OR CHANGE THE VENUE OF ANY LITIGATION BROUGHT AGAINST MAKER BY LENDER OR ANY LENDER IN ACCORDANCE HEREWITH.

It is the intent of the parties that the rate of interest and the other charges to Maker under this Note shall be lawful; therefore, if for any reason the interest or other charges payable under this Note are found by a court of competent jurisdiction, in a final determination, to exceed the limit which the Lenderr may lawfully charge Maker, then the obligation to pay interest and other charges shall automatically be reduced to such limit and if any amount in excess of such limit shall have been paid, then such amount shall treated as provided in the Loan Agreement.

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As additional security for the Maker’s obligations hereunder, Maker grants to the Lender a lien, on, security interest in, and right of setoff against, all sums owed by the Lender in any capacity to the Maker and all property of the Maker in the possession of the Lender. Upon the occurrence of an Event of Default, to the extent permitted by and in addition to any other remedy provided by law, and regardless of the adequacy of any collateral or other means of obtaining repayment of the obligations evidenced hereby, the Lender shall have the right immediately and without notice or other act, and is specifically authorized hereby, to setoff against any of the Maker’s obligations under this Note any sum owed by the Lender in any capacity to the Maker, whether due or not, or any property of the Maker in the possession of the Lender, even if effecting such setoff results in a loss or reduction of interest to the Maker or the imposition of a penalty applicable to the early withdrawal of time deposits.

In case any one or more of the provisions contained in this Note, or any of the documents or agreements contemplated hereby, should be invalid, illegal or unenforceable in any respect, the validity, legality, and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby.

In the event that all or any part of any payments made to the Lender shall be rescinded, avoided or recovered from the Lender for any reason whatsoever, including, but not limited to, proceedings in connection with the insolvency or bankruptcy of the Maker or the paying party, the amount of such rescinded, avoided or recovered payment shall be added to the balance of this Note and all representations, warranties and covenants of the Maker shall remain in full force and effect and the Maker shall remain liable to the Lender for the mount of such rescinded, avoided or recovered payments in accordance with this Note.

The Maker will pay all expenses, including reasonable fees and expenses of legal counsel of the Lender and such other experts and consultants as the Lender shall deem appropriate, incurred in any and all dealings between the Maker and the Lender, including, without limitation, those incurred in connection with the preparation, administration, negotiation, amendment, modification, protection, enforcement and collection of this Note and all other agreements and instruments required hereunder or pertaining hereto, including, without limitation, the Loan Agreement and the Other Documents. All such expenses incurred by the Lender through the date hereof shall be paid by the Maker simultaneously with the execution hereof. All other such expenses shall be paid by the Maker on demand.

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IN WITNESS WHEREOF, the Maker has executed this Note as of the day and year first above written.

Witnesseth:	MAKER:
	IMPCO TECHNOLOGIES, INC.
	By:
		Name:
		Title:

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EX-10.71

Exhibit 10.71

LOAN AND SECURITY AGREEMENT

Dated as of July     , 2003

among

IMPCO TECHNOLOGIES, INC.,

as Borrower

and

LASALLE BUSINESS CREDIT, LLC,

as a Lender and as Agent

and

THE INSTITUTIONS FROM TIME TO TIME

A PARTY HERETO

as Lenders

$12,000,000

THIS LOAN AND SECURITY AGREEMENT (“Agreement”) is made as of this      day of July, 2003, by and among LASALLE BUSINESS CREDIT, LLC, a Delaware limited liability company (“LaSalle”), with its principal office at 135 South LaSalle Street, Chicago, Illinois 60603, the financial institutions which from time to time become a party hereto (collectively, the “Lenders” and individually, a “Lender”), LaSalle as agent for Lenders (in such capacity, “Agent”), and IMPCO TECHNOLOGIES, INC., a Delaware corporation, with its principal office at 16804 Gridley Place, Cerritos, California 90703 (“Borrower”).

WITNESSETH:

WHEREAS, from time to time Borrower may request Agent and Lenders to make loans and advances to and extend certain credit accommodations to Borrower, and the parties wish to provide for the terms and conditions upon which such loans, advances and credit accommodations shall be made;

NOW, THEREFORE, in consideration of any loans, advances and credit accommodations (including any loans by renewal or extension) hereafter made to Borrower by Agent and the Lenders, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by Borrower, the parties agree as follows:

1. DEFINITIONS.

(a) General Definitions

“Account Debtor” shall mean the Person who is obligated on or under an Account.

“Accounts” shall have the meaning given to the term “accounts” in the UCC and shall in any event include, without limitation, all of Borrower’s presently existing and hereafter arising accounts, accounts receivable, contract rights, instruments, documents, chattel paper, and all other forms of obligations owing to Borrower arising out of the sale or lease of goods or the rendition of services by Borrower, whether or not earned by performance, and any and all credit insurance, guarantees, letters of credit and other security therefor, as well as all merchandise returned to or reclaimed by Borrower, and all products and proceeds of the foregoing.

“Accounts Advance Rate” shall have the meaning set forth in paragraph 2(b)(i)(A) hereof.

“Accounts Trial Balance” shall have the meaning set forth in paragraph 11(c) hereof.

“Advance Rates” shall mean collectively, the Accounts Advance Rate and the Inventory Advance Rate.

“Affiliate” means any Person: (a) directly or indirectly controlling, controlled by, or under common control with, Borrower; (b) directly or indirectly owning or holding five percent (5%) or more of any equity interest in Borrower; or (c) five percent (5%) or more of

whose voting stock or other equity interest having ordinary voting power for the election of directors or the power to direct or cause the direction of management, is directly or indirectly owned or held by Borrower; or (d) which has a senior executive officer who is also a senior executive officer of Borrower. For purposes of this definition, “control” (including with correlative meanings, the terms “controlling”, “controlled by” and “under common control with”) means the possession directly or indirectly of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities or other equity interest, or by contract or otherwise. Notwithstanding anything to the contrary contained in the foregoing, the following entities shall at all time be deemed to be an “Affiliate” of Borrower: the Consolidated Subsidiaries and BRC.

“Agent” shall have the meaning set forth in the introductory paragraph hereof.

“Asset Disposition” shall mean the disposition, whether by sale, lease, transfer, loss, damage, destruction, condemnation or otherwise of any or all of the assets of Borrower, or any of its Subsidiaries or Affiliates, other than sales of Inventory or Equipment in the ordinary course of business consistent with prudent business practice.

“Authority” shall have the meaning set forth in paragraph 14(t)(iv) hereof.

“Bank” shall mean LaSalle Bank National Association.

“Bankruptcy Code” shall mean the Bankruptcy Reform Act of 1978, as amended, including amendments made by The Bankruptcy Reform Act of 1994, as codified in Title 11 of the United States Code.

“Benefit Plan” shall mean an employee pension benefit plan of Borrower or an ERISA Affiliate, as defined in Section 3(2) of ERISA, which is subject to Title IV of ERISA.

“Blocked Account” shall have the meaning set forth in paragraph 10(a).

“Borrower” shall have the meaning set forth in the introductory paragraph hereof.

“Borrowing Base” shall have the meaning specified in paragraph 2(b)(i) hereof.

“Borrowing Base Certificate” shall mean a certificate duly executed by an officer of Borrower appropriately completed and in substantially the form of Exhibit C hereto.

“BRC” shall mean B.R.C. Societa a Responsablità Limitata, an Italian limited liability company.

“BRC Agreements” shall collectively mean the BRC Sale and Purchase Agreement, the BRC Option Agreement, the BRC Lock-up Agreement and the BRC Shareholders Agreement, together with all amendments thereof and other documents ancillary thereto.

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“BRC Lock-up Agreement” shall mean, collectively, the form of lockup agreement contemplated by the BRC Option Agreement and executed by each of the BRC Shareholders in favor of Borrower, as amended from time to time.

“BRC Option Agreement” shall mean that certain Option Agreement, dated as of October 3, 2002, by and among Borrower and the controlling shareholders of BRC, as amended from time to time.

“BRC Sale and Purchase Agreement” shall mean that certain Sale and Purchase Agreement, dated as of May 8, 2003, by and among the Borrower and the BRC Shareholders, as amended from time to time.

“BRC Shareholders” shall mean each of Mariano Costamagna, Pier Antonio Costamagna, Bruna Giachino and Carla Borgogno.

“BRC Transaction” shall mean the payment on or before September 30, 2003 of the Deferred Portion of the Purchase Price (as such term is defined in the BRC Sale and Purchase Agreement) and such other actions as are contemplated by the BRC Agreements to be performed by Borrower to fully consummate its acquisition of 50% of the currently outstanding equity of BRC in accordance with the BRC Sale and Purchase Agreement.

“Bridge Loan Lenders” shall have the meaning specified in paragraph 15(a)(xxvii) hereof.

“Bridge Loan Subordinated Debt Documents” shall have the meaning specified in paragraph 15(a)(xxvii) hereof.

“Bridge Loan Subordination Agreements” shall have the meaning specified in paragraph 15(a)(xxvii) hereof.

“Business Day” shall mean with respect to all Loans, any day other than a Saturday, Sunday, or such other day as banks in Illinois and/or New York are authorized or required to be closed for business.

“Capital Adequacy Charge” shall have the meaning specified in paragraph 5(i) hereof.

“Capital Adequacy Demand” shall have the meaning specified in paragraph 5(i) hereof.

“Capital Expenditures” shall mean, with respect to any period, the aggregate of all expenditures (whether paid in cash or accrued as liabilities and including expenditures for capitalized lease obligations) by Borrower during such period that are required by GAAP to be included in or reflected by the property, plant or equipment or similar fixed asset accounts (or in intangible accounts subject to amortization) in the balance sheet of Borrower.

“Capital Lease” shall mean a lease that is required to be capitalized for financial reporting purposes in accordance with GAAP.

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“Capital Lease Obligations” of any Person shall mean any Indebtedness represented by obligations under a Capital Lease.

“Cash Equivalents” shall mean: (a) marketable direct obligations issued or unconditionally guaranteed by the United States or issued by any agency thereof and backed by the full faith and credit of the United States, in each case maturing within one (1) year from the date of acquisition thereof, (b) marketable direct obligations issued by any state of the United States or any political subdivision of any such state or any public instrumentality thereof maturing within one (1) year from the date of acquisition thereof and, at the time of acquisition, having the highest rating obtainable from either Standard & Poor’s rating service (“S&P”) or Moody’s Investors Service, Inc. (“Moody’s”), (c) commercial paper maturing no more than two hundred seventy (270) days from the date of acquisition thereof and, at the time of acquisition, having a rating of A-1 or P-1, or better, from S&P or Moody’s, and (d) certificates of deposit or bankers’ acceptances maturing within one (1) year from the date of acquisition thereof that are either: (i) issued by any bank organized under the laws of the United States or any state thereof which bank has a rating of A or A2, or better, from S&P or Moody’s, or (ii) in an amount less than or equal to $100,000 in the aggregate if issued by any other bank insured by the Federal Deposit Insurance Corporation.

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

“Change of Control” shall mean: (a) the occurrence of any event (whether in one or more transactions) which results in an acquisition of: (i) more than twenty-five percent (25%) of the outstanding shares of Borrower’s stock, or (ii) control of Borrower by a Person who is not presently an owner of Borrower or directly controlled by a present owner, (b) any merger or consolidation of or with Borrower, (c) the sale of all or substantially all of the property or assets of Borrower, (d) a majority of the present members of the board of directors of Borrower shall cease to be members of Borrower’s board of directors, or (e) a breach of any change of ownership or control provision under the Securities Purchase Agreement or any other existing or future credit or loan agreement to which Borrower is a party. For purposes of this definition, “control of Borrower” shall mean the power, direct or indirect to direct or cause the direction of the management and policies of Borrower by contract or otherwise.

“Chattel Paper” shall have the meaning given to the term “chattel paper” in the UCC and in any event shall include, without limitation, a writing or writings which evidence both a monetary obligation and a security interest in or a lease of specific goods.

“Closing Date” shall mean the date upon which the initial Loan is made.

“Closing Document List” shall have the meaning specified in paragraph 15(a)(i) hereof.

“Collateral” shall mean all of the personal property of Borrower as described in paragraph 8 hereof and all other real or personal property of any Obligor or any other Person now or hereafter pledged to Agent for its benefit and for the ratable benefit of Lenders to secure, either directly or indirectly, repayment of any of the Liabilities.

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“Collateral Locations” shall have the meaning set forth in paragraph 13(c) hereof.

“Commercial Tort Claim” shall have the meaning given to the term “commercial tort claim” in the UCC and in any event shall include, without limitation, a claim arising in tort with respect to which: (A) the claimant is an organization; or (B) the claimant is an individual and the claim: (i) arose in the course of the claimant’s business or profession; and (ii) does not include damages arising out of personal injury to or the death of an individual.

“Commitment Percentage” of any Lender shall mean the percentage set forth below such Lender’s name on the signature page hereof as same may be adjusted upon any assignment by a Lender pursuant to paragraph 24 hereof.

“Commitment Transfer Supplement” has the meaning set forth in paragraph 24(b).

“Confidential Information” shall have the meaning set forth in paragraph 27(e) hereof.

“Consolidated EBITDA” shall mean, for any period, the consolidated EBITDA of the Consolidated Group, determined on a consolidated basis, in accordance with GAAP.

“Consolidated Group” shall mean Borrower and the Consolidated Subsidiaries.

“Consolidated Leverage Ratio” shall mean, as at the last day of any period of four (4) consecutive fiscal quarters, the ratio of: (a) Indebtedness of the Consolidated Group on such day to (b) Consolidated EBITDA for such periods.

“Consolidated Subsidiaries” shall mean IMPCO Technologies Pty Limited, IMPCO Technologies (SA) Pty Ltd., IMPCO Technologies (NSW) Pty. Ltd., IMPCO Fuel Systems Pty Ltd., IMPCO Technologies Japan, KK, Grupo I.M.P.C.O. Mexicano, IMPCO-BERU Technologies B.V., IMPCO-BERU Technologies, GmbH, IMPCO-BERU Technologies S.A.R.L., IMPCO-BERU Technologies Limited, Minda IMPCO Technologies, Limited, Minda IMPCO Limited, and CNGC-IMPCO Technologies, LLC.

“Consolidated Tangible Net Worth” shall mean, for any period, the consolidated Tangible Net Worth of the Consolidated Group, determined on a consolidated basis, in accordance with GAAP.

“Contingent Obligation(s)” as applied to any Person, shall mean any direct or indirect liability, contingent or otherwise, of that Person: (i) with respect to any underlying indebtedness, lease, dividend or other obligation of another Person if the primary purpose or intent of the Person incurring such liability, or the primary effect thereof, is to provide assurance to the obligee of such liability that the underlying indebtedness, lease, dividend or other obligation will be paid or discharged, or that any agreements relating thereto will be complied with, or that the holders of such liability will be protected (in whole or in part) against loss with respect thereto; (ii) with respect to any letter of credit issued for the account of that Person or as to which that Person is otherwise liable for reimbursement of drawings; or (iii) under any foreign

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exchange contract, currency swap agreement, interest rate swap agreement or other similar agreement or arrangement designed to alter the risks of that Person arising from fluctuations in currency values or interest rates. Contingent Obligations shall include, without limitation, (a) the direct or indirect guaranty, endorsement (other than for collection or deposit in the ordinary course of business), co-making, discounting with recourse or sale with recourse by such Person of the obligation of another, (b) the obligation to make take-or-pay or similar payments if required regardless of nonperformance by any other party or parties to an agreement, or to maintain working capital or equity capital of such other Person or otherwise to maintain the net worth or solvency of such other Person, (c) any liability of such Person for the obligations of another through any agreement to purchase, repurchase or otherwise acquire such obligation or any property constituting security therefor, to provide funds for the payment or discharge of such obligation or to maintain the solvency, financial condition or any balance sheet item or level of income of another, and (d) otherwise to assure or hold harmless the owner of any of the foregoing obligations against loss in respect thereto. The amount of any Contingent Obligation shall be equal to the amount of the obligation so guaranteed or otherwise supported or, if not a fixed and determined amount, the maximum amount so guaranteed.

“Contract Year” shall mean each period of twelve (12) consecutive months commencing on the Closing Date and on each anniversary thereafter.

“Controlled Group” shall mean all members of a controlled group of corporations and all trades or businesses (whether or not incorporated) under common control which, together with Borrower, are treated as a single employer under Section 414 of the IRC.

“Customer Lists” shall mean the customer lists of Borrower which include the name and complete address of each of Borrower’s customers, attached hereto as Exhibit B and made a part hereof, as same shall be updated pursuant to paragraph 11(h) hereof.

“Customs” shall have the meaning set forth in paragraph 3(f) hereof.

“Default” shall mean any event, condition or default which with the giving of notice, the lapse of time or both would be an Event of Default.

“Defaulting Lender” shall have the meaning set forth in paragraph 6(g) hereof.

“Defaulting Lender Cure Period” shall have the meaning set forth in paragraph 6(l) hereof.

“Deposit Account” shall have the meaning given to the term “deposit account” in the UCC and in any event shall include, without limitation, a demand, time, savings, passbook or similar account maintained with a bank.

“Designated Lender” shall have the meaning set forth in paragraph 6(l) hereof.

“Documents” shall mean the term “documents” as such term is defined under Article 9 of the UCC.

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

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“EBITDA” shall mean, with respect to any applicable fiscal period, the following for any Person or Persons each calculated for such fiscal period: net income before taxes for such period (excluding pre-tax gains or losses on the sale of assets (other than the sales of Inventory in the ordinary course of business) and excluding other pre-tax extraordinary gains) plus cash interest expense, depreciation, amortization and other non-cash charges deducted in determining net income for such period, minus interest income calculated in determining net income for such period.

“Eligible Account” shall mean an Account owing to Borrower which is acceptable to Agent in its reasonable discretion for lending purposes. Agent shall, in general, consider an Account to be an Eligible Account if it meets, and so long as it continues to meet, the following requirements:

(i) it is genuine and in all respects is what it purports to be;

(ii) it is owned by Borrower and Borrower has the right to subject it to a security interest in favor of Agent;

(iii) it arises from: (A) the performance of services by Borrower and such services have been fully performed and acknowledged and accepted by the Account Debtor thereunder, or (B) the sale or lease of Goods by Borrower, and such Goods have been completed in accordance with the Account Debtor’s specifications (if any) and delivered to and accepted by the Account Debtor (provided, however, if such Goods have not been completed in accordance with the Account Debtor’s specifications, such Goods may not be considered ineligible solely due to its failure to satisfy such specifications, if such Account Debtor has waived such specifications and accepted all such Goods as-is where-is with all faults, all in writing in form and substance satisfactory to Lender), and such Account Debtor has not returned, offered to return or given notice of its intention to return any of the Goods which are the subject of such Account, and Borrower has possession of, or has delivered to Agent at Agent’s request, shipping and delivery receipts evidencing delivery of such Goods;

(iv) it is evidenced by an invoice rendered to the Account Debtor thereunder, does not remain unpaid more than either: (x) sixty (60) days after the stated due date thereof and (y) ninety (90) days past the stated invoice date thereof; provided, however, that if more than twenty-five percent (25%) of the aggregate dollar amount of invoices owing by a particular Account Debtor remain unpaid for more than: (A) sixty (60) days past the respective stated due dates thereof or (B) ninety (90) days past the respective invoice dates thereof, then all Accounts owing to Borrower by that Account Debtor shall be deemed ineligible;

(v) it is not subject to any prior assignment, offset, claim, lien, security interest or encumbrance whatsoever, other than Liens in favor of Agent and subordinate liens granted to the Subordinate Lender covered by the Subordination Agreement;

(vi) it is a valid, legally enforceable and unconditional obligation of the Account Debtor thereunder, and is not subject to setoff, counterclaim, credit, allowance or adjustment by such Account Debtor, or to any claim asserted by such Account Debtor denying liability thereunder in whole or in part;

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(vii) it does not arise out of a contract or order which fails in any material respect to comply with the requirements of applicable law;

(viii) the Account Debtor thereunder is not a director, officer, employee or agent of Borrower, or a Subsidiary, Parent or Affiliate of Borrower;

(ix) it is not an Account with respect to which the Account Debtor is the United States of America or any state or local government, or any department, agency or instrumentality thereof, unless Borrower assigns its right to payment of such Account to Agent pursuant to, and in full compliance with, the Assignment of Claims Act of 1940, as amended or any comparable state or local law;

(x) it is not an Account with respect to which the Account Debtor is located in a state which requires Borrower, as a precondition to commencing or maintaining an action in the courts of that state, either to: (A) receive a certificate of authority to do business and be in good standing in such state, or (B) file a notice of business activities report or similar report with such state’s taxing authority, unless: (x) Borrower has taken one of the actions described in clauses (A) or (B), (y) the failure to take one of the actions described in either clause (A) or (B) may be cured retroactively by Borrower at its election, or (z) Borrower has proven, to Agent’s satisfaction, that it is exempt from any such requirements under any such state’s laws;

(xi) it is an Account which arises out of a sale made in the ordinary course of Borrower’s business;

(xii) the Account Debtor is a resident or citizen of, and is located within, the United States of America or Canada;

(xiii) it is not an Account with respect to which the Account Debtor’s obligation to pay is conditional upon the Account Debtor’s approval of the Goods or services or is otherwise subject to any repurchase obligation or return right, as with sales made on a bill-and-hold, guaranteed sale, sale on approval, sale or return or consignment basis;

(xiv) it is not an Account: (A) with respect to which any representation or warranty contained in this Agreement is untrue or (B) which violates any of the covenants of Borrower contained in this Agreement;

(xv) it is not an Account which, when added to a particular Account Debtor’s other indebtedness to Borrower, exceeds fifteen percent (15%) of the aggregate of Borrower’s Accounts (except with respect to Accounts due from UPS Oasis Supply, in which case, such percentage limit shall be 25%); provided, however, that Accounts excluded from Eligible Accounts solely by reason of this subparagraph (xv) shall be Eligible Accounts to the extent of such concentration limit;

(xvi) it is not an Account with respect to which the prospect of payment or performance by the Account Debtor is or will be impaired, as determined by Agent in its sole discretion;

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(xvii) it is not an Account arising from progress billings, invoices for deposits, samples or tooling;

(xviii) it is not an Account with respect to which the sale is on an installment basis, cash on delivery basis, lease or other extended payment basis; and

(xix) it is not that portion of an Account representing late fees, service charges or interest.

“Eligible Inventory” shall mean Inventory held for sale by Borrower, normally and currently saleable in the ordinary course of Borrower’s business, and which at all times pertinent hereto is of good and merchantable quality, free from defects, as to which Inventory Agent has a perfected first priority security interest and which Inventory is subject to no other Lien other than Liens in favor of Agent and subordinate Liens in favor of the Subordinate Lender which are covered by the Subordination Agreement, and which is located at the locations set forth in Exhibit A of this Agreement and is not in transit, as that Exhibit may, from time to time, be amended or supplemented in accordance with the terms of this Agreement, and as to which Borrower has satisfied all terms, conditions, warranties and representations of this Agreement and the Other Agreements; but Eligible Inventory shall not include any of the following: (i) catalogs, marketing materials, packages, shipping materials, supplies consumed in Borrower’s business, shrink wrap and warranty reserves and other promotional materials of any kind; (ii) returned items; (iii) work-in-process; (iv) damaged, defective or recalled items; (v) obsolete items; (vi) items used as demonstrators, prototypes or salesmen’s samples; (vii) items of Inventory which have been consigned to Borrower or as to which a Person claims a security interest, prior assignment claim or encumbrance whatsoever other than Liens in favor of Agent; (viii) items of Inventory which have been consigned by Borrower to a consignee; (ix) Inventory located on premises leased by Borrower from a landlord with whom Agent has not entered into a landlord’s waiver on terms satisfactory to Agent; (x) Inventory located at a warehouse premises with respect to which Agent has not received: (1) a bailee letter, acceptable in all respects to Agent, executed by the bailee of such warehouse or (2) evidence satisfactory in all respects to Agent of such bailee’s receipt of a bailee letter acceptable in all respects to Agent; (xi) Inventory which in the reasonable judgment of Agent is considered to be slow moving or otherwise not merchantable; (xii) Inventory located outside the United States of America or Canada; (xiii) material review board Inventory; (xiv) labor and overhead costs added to raw materials and other raw material labor and burden; (xv) sub-assemblies and components; (xvi) scrap materials; (xvii) Inventory in transit; (xviii) Inventory which is subject to a license agreement unless Agent shall have entered into a licensor consent letter with the licensor in form and substance satisfactory to Agent; and (xix) any Inventory that Agent has reasonably determined is not acceptable due to age, type, category or quantity.

“Eligible L/C Inventory” shall mean all raw material or finished goods Inventory owned by Borrower which is in transit to one of the Collateral Locations and which Inventory is: (a) owned by Borrower, (b) fully insured with Agent named as loss payee with respect to such insurance, (c) subject to a first priority security interest in and lien upon such goods in favor of Agent (except for any possessory lien upon such goods in the possession of a freight carrier or shipping company securing only the freight charges for the transportation of such goods to Borrower), (d) evidenced or deliverable pursuant to documents, notices,

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instruments, statements and bills of lading all of which have been delivered to Agent or an agent acting on Agent’s behalf, (e) Agent has entered into a written agreement, in form and substance reasonably satisfactory to Agent, with Borrower and Borrower’s customs broker and/or any other Person working on behalf of Borrower, who is reasonably satisfactory to Agent in all respects and who is responsible for clearing Inventory through Customs on behalf of Borrower (“Importer”), which shall provide, among other things, that upon notice to Importer by Agent, Importer shall thereafter take direction with respect to such Inventory, including transfer, disposition or possession of such Inventory solely from Lender (and not Borrower), (f) such Inventory has been purchased pursuant to the terms of a documentary Letter of Credit issued pursuant to the terms of this Agreement, and (g) except for such Inventory being in-transit is otherwise deemed “Eligible Inventory” hereunder.

“Environmental Complaint” shall have the meaning set forth in paragraph 14(s)(iv) hereof.

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

“Equipment” shall have the meaning given to the term “equipment” in the UCC and in any event shall include, without limitation, the machinery and equipment of Borrower, including without limitation processing equipment, data processing and computer equipment with software and peripheral equipment, and all engineering, processing and manufacturing equipment, office machinery, furniture, materials handling equipment, tools, molds, dies, attachments, accessories, automotive equipment, trailers, trucks, motor vehicles, tanks, cylinders and other equipment of every kind and nature, and fixtures, all whether now owned or hereafter acquired, and wheresoever situated, together with all additions and accessions thereto, replacements therefor, all parts therefor, and all manuals, drawings, instructions, warranties, and rights with respect thereto, and all products and proceeds of the foregoing, and condemnation awards and insurance proceeds with respect thereto.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended, and all references to sections thereof shall include such sections and any predecessor and successor provisions thereto.

“ERISA Affiliate” shall mean any member of a controlled group of entities as determined under Section 414(b),(c),(m), or (o) of the IRC, of which Borrower is a member.

“Event of Default” shall have the meaning specified in paragraph 16 hereof.

“Excess Availability” shall mean, as of any date of determination by Agent, the excess, if any, of: (i) the lesser of: (a) the Revolving Loan Commitment and (b) the Borrowing Base over (ii) the outstanding Revolving Loans, in each case as of the close of business on such date. For purposes of calculating Excess Availability of Borrower and the amount of the

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Borrowing Base relating thereto, Agent may, in the exercise of its sole discretion, establish a reserve in an aggregate amount based on the sum of: (a) Borrower’s outstanding trade payables which are not current or which are past due beyond Borrower’s normal trade terms in any material respect, plus (b) any taxes due and unpaid to any taxing authority, plus (c) transaction fees incurred by Borrower in connection with the consummation of the transactions contemplated by this Agreement which are due and remain unpaid, in each case as of such date of determination, to the extent thereof.

“Exhibit A” shall mean the exhibit entitled Exhibit A - - Business and Collateral Locations which is attached hereto and made a part hereof.

“Exhibit D” shall mean the exhibit entitled Exhibit D - Officer’s Certificate which is attached hereto and made a part hereof.

“Fiscal Year” shall mean with respect to Borrower, the twelve (12) month accounting period of Borrower commencing January 1^st of each calendar year and ending December 31^st of such calendar year.

“Fixed Charge Coverage Ratio” shall mean and include, with respect to any applicable fiscal period, the ratio of: (a) Consolidated EBITDA, minus non-financed Capital Expenditures made during such period by any member of the Consolidated Group minus cash taxes actually paid during such period with respect to the Consolidated Group to (b) the sum of: (i) scheduled principal payments of long-term debt paid or scheduled to be paid during such period by any member of the Consolidated Group plus (ii) capitalized leases paid or scheduled to be paid during such period by any member of the Consolidated Group plus (iii) cash interest expense of the Consolidated Group for such period plus (iv) payments made to the Subordinated Lender plus (v) payments made to the Bridge Loan Lenders.

“GAAP” shall mean generally accepted accounting principles and policies in the United States as in effect from time to time as applied by Borrower on a consistent basis.

“General Intangibles” shall have the meaning given to the term “general intangibles” in the UCC and in any event shall include, without limitation, all of Borrower’s present and future general intangibles and other personal property, any and all rights of Borrower to all choses or things in action, tax refund claims, credits, claims, claims against carriers and shippers, guarantee claims, contract rights, rights under contracts, security interests, security rights and any rights to indemnification, demands, goodwill, licenses, franchise agreements, subscription costs, patents, patent applications, design rights, trade names, trademarks, trademark applications, copyrights, registrations, rights to royalties, blueprints, drawings, customer lists, purchase orders, computer programs, computer discs, computer tapes, literature, reports, catalogs, methods, sales literature, video tapes, confidential information and trade secrets, consulting agreements, employment agreements, leasehold interests in real and personal property, insurance policies, deposits with insurers relating to worker’s compensation liabilities, Deposit Accounts and tax refunds, other than Equipment, Inventory, Investment Property and Accounts, as well as Borrower’s books and records relating to any of the foregoing, and all products and proceeds of the foregoing.

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“Goods” shall have the meaning given to the term “goods” in the UCC and in any event shall include, without limitation, all of Borrower’s tangible assets and tangible properties which are moveable at the time the security interest attaches or which are fixtures.

“Hazardous Discharge” shall have the meaning set forth in paragraph 14(t)(iv) hereof.

“Hazardous Substance” shall mean, without limitation, any flammable explosives, radon, radioactive materials, asbestos, urea formaldehyde foam insulation, polychlorinated biphenyls, petroleum and petroleum products, methane, hazardous materials, Hazardous Wastes, hazardous or Toxic Substances or related materials as defined in CERCLA, the Hazardous Materials Transportation Act, as amended (49 U.S.C. Sections 1801, et seq.), RCRA, Articles 15 and 27 of the New York State Environmental Conservation Law or any other applicable Environmental Law and in the regulations adopted pursuant thereto.

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

“Health-Care-Insurance Receivable” shall have the meaning given to the term “health-care-insurance-receivable” in the UCC and in any event shall include, without limitation, an interest in or claim under a policy of insurance which is a right to payment of a monetary obligation for health-care goods or services provided.

“Hedge Agreements” shall mean all interest rate swaps, caps or collar agreements or similar arrangements entered into by Borrower or any of its Subsidiaries providing for protection against fluctuations in interest rates, currency exchange rates or commodity prices, or the exchange of nominal interest obligations, either generally or under specific contingencies.

“Highest Lawful Rate” shall have the meaning set forth in paragraph 5(c).

“Indebtedness” shall mean of any Person at any date, without duplication, (a) all indebtedness of such Person for borrowed money, (b) all obligations of such Person for the deferred purchase price of Property or services (other than trade payables incurred in the ordinary course of such Person’s business), (c) all obligations of such Person evidenced by notes, bonds, debentures or other similar instruments, (d) all indebtedness created or arising under any conditional sale or other title retention agreement with respect to Property acquired by such Person (even though the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such property), (e) all Capital Lease Obligations or Synthetic Lease Obligations of such Person, (f) all obligations of such Person, contingent or otherwise, as an account party under acceptance, letter of credit or similar facilities, (g) all obligations of such Person, contingent or otherwise, to purchase, redeem, retire or otherwise acquire for value any equity of such Person, (h) all Contingent Obligations of such Person in respect of obligations of the kind referred to in clauses (a) through (g) above; (i) all obligations of the kind referred to in clauses (a) through (h) above secured by (or for which the holder of such obligation has an existing right, contingent or otherwise, to be secured by) any

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Lien on Property (including, without limitation, accounts and contract rights) owned by such Person, whether or not such Person has assumed or become liable for the payment of such obligation, (j) all accrued but unpaid obligations of such Person in respect of Hedge Agreements and (k) the redemption value of any preferred equity of such Person or its Subsidiaries held by any Person other than such Person and its wholly-owned Subsidiaries; provided, however, that obligations of the kind referred to in clause (j) shall not be included in “Indebtedness” for the purposes of calculating the financial covenants set forth in paragraph 14(p).

“Indemnified Party” shall have the meaning specified in paragraph 18 hereof.

“Instruments” shall have the meaning given to the term “instruments” in the UCC and in any event shall include, without limitation, a negotiable instrument or a certificated security or any other writing which evidences a right to the payment of money.

“Inventory” shall have the meaning given to the term “inventory” in the UCC and in any event shall include, without limitation, all present and future inventory in which Borrower has any interest, including, but not limited to, goods held by Borrower for sale or lease or to be furnished under a contract of service and all of Borrower’s present and future raw materials, work in process, finished goods, supplies and packing and shipping materials, wherever located, any and all merchandise returned to or reclaimed by Borrower, and any documents of title representing any of the above.

“Inventory Advance Rate” shall have the meaning set forth in paragraph 2(b)(i)(A) hereof.

“Investment Property” shall have the meaning given to the term “investment property” in the UCC, and in any event shall include, without limitation, all of Borrower’s now owned or hereafter acquired securities, whether certificated or uncertificated, securities entitlements, securities accounts, commodity and futures contracts and commodity and futures accounts.

“IRC” shall mean the Internal Revenue Code of 1986, as amended from time to time.

“ISP 98” shall mean the International Standby Practices which applies to standby letters of credit, prepared by the Institute of International Banking Law and Practice, as amended from time to time.

“L/C Issuer” shall mean the Bank or such other bank as may be selected by Agent in its sole discretion.

“Lender Default” shall have the meaning set forth in paragraph 6(g) hereof.

“Lender(s)” shall have the meaning set forth in the introductory paragraph hereof.

“Letter of Credit Fee” shall have the meaning set forth in paragraph 5(d) hereof.

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“Letter of Credit Obligations” shall mean, as of any date of determination, the sum of: (i) 100% of the aggregate face amount of all undrawn Stand-by Letters of Credit, (ii) 50% of the aggregate face amount of all undrawn Documentary Letters of Credit and (iii) the aggregate unreimbursed amount of all drawn Letters of Credit.

“Letter-of-Credit Right” shall have the meaning given to the term “letter-of-credit-right” in the UCC and in any event shall include, without limitation, a right to payment or performance under a letter of credit, whether or not the beneficiary has demanded or is at the time entitled to demand payment or performance.

“Letters of Credit” shall mean those documentary letters of credit (“Documentary Letters of Credit”) and stand-by letters of credit (Stand-by Letters of Credit”) issued for Borrower’s account in accordance with the terms of paragraph 3 hereof.

“Liabilities” shall mean all Loans and any and all other obligations, liabilities and Indebtedness of Borrower to Agent and/or Lenders or to any parent, affiliate or subsidiary of Agent and/or Lenders of any and every kind and nature, howsoever created, arising or evidenced and howsoever owned, held or acquired, and any and all other Loans, obligations, liabilities and indebtedness of Borrower to Agent and/or Lenders of any kind and nature, howsoever created, arising or evidenced under this Agreement and/or the Other Agreements, in each case whether now or hereafter existing, whether now due or to become due, whether primary, secondary, direct, indirect, absolute, contingent or otherwise (including, without limitation, obligations of performance), whether several, joint or joint and several, and whether arising or existing under written or oral agreement or by operation of law.

“Lien” shall mean any mortgage or deed of trust, pledge, hypothecation, assignment, deposit arrangement, lien, charge, claim, security interest, easement or encumbrance, or preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever (including any lease or title retention agreement, any financing lease having substantially the same economic effect as any of the foregoing, and the filing of, or agreement to give, any financing statement perfecting a security interest under the UCC or comparable law of any jurisdiction).

“Loan” or “Loans” shall mean any and all Revolving Loans, made by Agent and Lenders to Borrower pursuant to paragraph 2 hereof and all other loans, advances and financial accommodations made by Agent and Lenders to or on behalf of Borrower hereunder.

“Lock Box” shall have the meaning specified in paragraph 10 hereof.

“Material Adverse Effect” shall mean a material adverse change in, or a material adverse effect upon, any of the business, property, assets, operations, condition (financial or otherwise) or prospects of Borrower, related to any event, act, condition or occurrence of whatever nature (including any adverse determination in any litigation, arbitration or governmental investigation or proceeding), whether singly or in conjunction with any other event or events, act or acts, condition or conditions, occurrence or occurrences, whether or not related.

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“Mexican Subsidiary” shall have the meaning specified in paragraph 14(h) hereof.

“Mexican Subsidiary Lender” shall have the meaning specified in paragraph 14(h) hereof.

“Multiemployer Plan” shall mean a plan described in Section 4001(a)(3) of ERISA which covers employees of Borrower or any ERISA Affiliate.

“Non-Defaulting Lenders” shall have the meaning set forth in paragraph 6(h) hereof.

“Note” shall mean, the Revolving Note.

“Obligor” shall mean Borrower and each Person who is or shall become primarily or secondarily liable for any of the Liabilities (including, without limitation any Person who provides security to Agent for any Liability), provided, however, that such term shall not include any Account Debtor.

“Organizational Documents” shall mean, collectively, as the case may be, articles of incorporation, certificate of incorporation, certificate of partnership, certificate of limited partnership, certificate of formation, by-laws, operating agreement, partnership agreement, limited partnership agreement and/or any other agreement, certificate, document and/or instrument associated with the organization and/or governance of the applicable entity or the conduct of its business.

“Other Agreements” shall mean all agreements, instruments and documents including, without limitation, guaranties, mortgages, trust deeds, pledges, powers of attorney, consents, assignments, contracts, notices, security agreements, leases, financing statements and all other writings heretofore, now or from time to time hereafter executed by or on behalf of Borrower or any other Person and delivered to Agent or any Lender or to any parent, affiliate or subsidiary of Agent or any Lender in connection with the Liabilities or the transactions contemplated hereby.

“Parent” shall mean any Person now or at any time or times hereafter owning or controlling (alone or with any other Person) at least a majority of the issued and outstanding stock or equity interest of Borrower or any Subsidiary and if Borrower is a Partnership, the general partner of Borrower.

“Participant” shall mean each Person who shall be granted the right by any Lender to participate in any of the Loans.

“Payment Intangible” shall have the meaning given to the term “payment intangible” in the UCC and in any event shall include, without limitation, a General Intangible under which the Account Debtor’s principle obligation is a monetary obligation.

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“Payment Office” shall mean initially 135 South LaSalle Street, Chicago, Illinois 60603, thereafter, such other office of Agent, if any, which Agent may designate by notice to Borrower to be the Payment Office.

“Permitted Liens” shall mean: (1) statutory liens of landlords, carriers, warehousemen, processors, mechanics, materialmen or suppliers incurred in the ordinary course of business and securing amounts not yet due or declared to be due by the claimant thereunder, (2) liens or security interests in favor of Agent, (3) zoning restrictions and easements, rights of way, licenses, covenants and other restrictions affecting the use of real property that do not individually or in the aggregate have a Material Adverse Effect on Borrower’s ability to use such real property for its intended purpose in connection with Borrower’s business, (4) liens securing the payment of taxes or other governmental charges not yet delinquent or being contested in good faith and by appropriate proceedings, (5) deposits to secure performance of bids, trade contracts, leases and statutory obligations (to the extent not excepted elsewhere herein); (6) liens specifically permitted by Agent in writing as set forth on Schedule 1(a) attached hereto; (7) pledges or deposits in connection with worker’s compensation, unemployment insurance and other social security legislation; (8) grants of security and rights of setoff in Deposit Accounts, securities and other properties held at banks or financial institutions to secure the payment or reimbursement under overdraft, acceptance and other facilities, (9) rights of setoff, banker’s lien and other similar rights arising solely by operation of law, and (10) subordinated liens granted to the Subordinated Lender under the Subordinated Debt Documents, to the extent subordinated to the liens granted to Agent hereunder pursuant to and permitted by the Subordination Agreement.

“PBGC” shall mean the Pension Benefit Guaranty Corporation or any successor agency.

“Person” shall mean any individual, sole proprietorship, partnership, limited liability company, joint venture, trust, unincorporated organization, association, corporation, institution, entity, party or foreign or United States government (whether federal, state, county, city, municipal or otherwise), including, without limitation, any instrumentality, division, agency, body or department thereof.

“Prime Rate” shall mean the publicly announced prime rate of the Bank, in effect from time to time. The Prime Rate is not intended to be the lowest or most favorable rate of the Bank in effect at any time.

“Prohibited Transaction” shall mean a prohibited transaction described in Section 406 of ERISA or Section 4975 of the IRC.

“Purchasing Lender” shall have the meaning set forth in paragraph 24(b) hereof.

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

“Real Property” shall mean all of Borrower’s right, title and interest in and to the owned and leased premises identified on Schedule 1(b) hereto.

“Register” shall have the meaning set forth in paragraph 24(c).

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“Releases” shall have the meaning set forth in paragraph 13(ee)(iii) hereof.

“Reportable Event” shall mean a reportable event described in Section 4043(b) of ERISA or the regulations promulgated thereunder for which the 30-day notice of such event has not been waived pursuant to such regulations.

“Required Lenders” shall mean Lenders holding at least fifty one percent (51%) of the Loans, or if no Loans are outstanding, Lenders holding at least fifty one percent (51%) of the Commitment Percentages.

“Revolving Loan Commitment” shall mean the sum of $12,000,000.

“Revolving Loans” shall have the meaning set forth in paragraph 2(a) hereof.

“Revolving Note” shall mean the promissory note(s) in the aggregate original principal amount of the Revolving Loan Commitment, executed by Borrower to the order of Agent for its benefit and for the benefit of Lenders, or to each Lender, as applicable, dated as of the Closing Date, together with all replacements and substitutions thereof.

“Settlement Date” shall mean the Closing Date and thereafter every Business Day designated by Agent as a “Settlement Date” by notice from Agent to each Lender, regardless of whether a Default or an Event of Default shall be in existence.

“Settlement Period” shall have the meaning set forth in paragraph 6(d)(i).

“Solvent” shall mean, with respect to any Person, as of any date of determination, (a) the amount the “present fair saleable value” of the assets of such Person will, as of such date, exceed the amount of all “liabilities of such Person, contingent or otherwise,” as of such date, as such quoted terms are determined in accordance with applicable federal and state laws governing determinations of the insolvency of debtors, (b) the present fair saleable value of the assets of such Person which will, as of such date, be greater than the amount that will be required to pay the liability of such Person on its debts as such debts become absolute and matured, (c) such Person will not have, as of such date, an unreasonably small amount of capital with which to conduct its business, (d) such Person will be able to pay its debts as they mature, and (e) such Person is not insolvent within the meaning of any applicable law. For purposes of this definition, (i) “debt” means liability on a “claim,” and (ii) “claim” means any (x) right to payment, whether or not such a right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured or (y) right to an equitable remedy for breach of performance if such breach gives rise to a right to payment, whether or not such right to an equitable remedy is reduced to judgment, fixed, contingent, matured or unmatured, disputed, undisputed, secured or unsecured.

“Subordinated Debt Documents” shall mean the Subordinated Note, the related Securities Purchase Agreement dated as of the date hereof (the “Securities Purchase Agreement”) between Borrower and the Subordinated Lender, and all other documents, agreements and instruments executed in connection therewith.

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“Subordinated Lender” shall mean Bison Capital Structured Equity Partners, LLC and its successors and permitted assigns.

“Subordinated Note” shall mean that certain Senior Subordinated Promissory Note dated as of the date hereof executed by Borrower in favor of Subordinated Lender in the original principal amount of $20,000,000, which Subordinated Note is due July     , 2007.

“Subordination Agreement” shall mean that certain Subordination and Intercreditor Agreement dated as of the Closing Date between Agent and Subordinated Lender, pursuant to which the Indebtedness evidenced by the Subordinated Debt Documents and the Liens securing such Indebtedness are fully subordinated to the Liabilities and the Liens in favor of Agent, which agreement shall be in form and substance acceptable to Agent.

“Subsidiary” shall mean: (i) any corporation of which more than fifty percent (50%) of the outstanding capital stock having ordinary voting power to elect a majority of the board of directors of such corporation (irrespective of whether at the time stock of any other class of such corporation shall have or might have voting power by reason of the happening of any contingency) is at the time, directly or indirectly, owned by Borrower, (ii) any partnership, limited liability company, entity or joint venture of which more than fifty percent (50%) of the outstanding equity interests is at the time, directly or indirectly, owned by Borrower or (iii) any partnership of which Borrower is general partner and includes, without limitation, the Consolidated Subsidiaries.

“Supporting Obligation” shall have the meaning given to the term “supporting obligation” in the UCC and in any event shall include, without limitation, a Letter-of-Credit Right or secondary obligation that supports the payment or performance of an Account, Chattel Paper, a Document, a General Intangible, an Instrument or Investment Property.

“Synthetic Lease Obligations” shall mean all monetary obligations of a Person under (a) a so-called synthetic, off-balance sheet or tax retention lease, or (b) an agreement for the use or possession of property creating obligations which do not appear on the balance sheet of such Person but which, upon the insolvency or bankruptcy of such Person, would be characterized as the Indebtedness of such Person (without regard to accounting treatment).

“Tangible Net Worth” shall mean with respect to any applicable fiscal period, the following for any Person or Persons, each calculated for such period on consolidated basis with respect to such Persons: shareholders’ equity (including retained earnings) less the book value of all intangible assets and less prepaid expenses, determined by Agent on a consistent basis, plus the amount of any debt subordinated to Agent on terms and conditions acceptable to Agent in its sole judgment, all as determined in accordance with GAAP, consistently applied.

“Term” shall have the meaning set forth in paragraph 12 hereof.

“Termination Event” shall mean: (i) a Reportable Event with respect to any Benefit Plan or Multiemployer Plan; (ii) the withdrawal of Borrower or any member of the Controlled Group from a Benefit Plan or Multiemployer Plan during a plan year in which such entity was a “substantial employer” as defined in Section 4001(a)(2) of ERISA; (iii) the providing of notice of intent to terminate a Plan in a distress termination described in Section

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4041(c) of ERISA; (iv) the institution by the PBGC of proceedings to terminate a Benefit Plan or Multiemployer Plan; (v) any event or condition: (a) which might reasonably constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Benefit Plan or Multiemployer Plan, or (b) that may reasonably result in termination of a Multiemployer Plan pursuant to Section 4041A of ERISA; or (vi) the partial or complete withdrawal within the meaning of Sections 4203 and 4205 of ERISA, of Borrower or any member of the Controlled Group from a Multiemployer Plan.

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

“Transactions” shall mean the transactions contemplated by the Subordinated Debt Documents and under this Agreement.

“Transferee” shall have the meaning set forth in paragraph 24(a) hereof.

“UCC” shall mean the Uniform Commercial Code as in effect on the date hereof in the State of New York, as amended and revised from time to time, and any successor statute; provided, however, that, in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection or priority of Agent’s security interest in any Collateral is governed by the Uniform Commercial Code as in effect in a jurisdiction other that the State of New York, the term “Code” shall mean the Uniform Commercial Code as in effect in such other jurisdiction for purposes of the provisions of this Agreement relating to such attachment, perfection or priority and for purposes of definitions related to such provisions.

(b) Accounting Terms and Definitions. Unless otherwise defined or specified herein, all accounting terms used in this Agreement shall be construed in accordance with GAAP, applied on a basis consistent in all material respects with the financial statements delivered by Borrower to Agent on or before the Closing Date or as otherwise agreed to by Agent. All accounting determinations for purposes of determining compliance with the financial covenants contained in paragraph 14(p) shall be made in accordance with GAAP as in effect on the Closing Date and applied on a basis consistent in all material respects with the audited financial statements of Borrower delivered to Agent by Borrower on or before the Closing Date. The financial statements required to be delivered hereunder from and after the Closing Date, and all financial records, shall be maintained in accordance with GAAP. If GAAP shall change from the basis used in preparing the audited financial statements delivered to Agent by Borrower on or before the Closing Date, the certificates required to be delivered pursuant to paragraph 11 demonstrating compliance with the covenants contained herein shall include, at the election of Borrower or upon the request of Agent, calculations setting forth the adjustments necessary to demonstrate how Borrower is in compliance with the financial covenants based upon GAAP as in effect on the Closing Date.

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2. REVOLVING LOANS. Subject to the terms and conditions of this Agreement and the Other Agreements, during the Term, absent the existence of a Default or Event of Default:

(a) Revolving Loan Commitment. Each Lender, severally and not jointly, shall make such revolving loans and advances (the “Revolving Loans”) to Borrower in aggregate amounts outstanding at any time equal to such Lender’s Commitment Percentage as Borrower shall from time to time request, in accordance with the terms of paragraph 2(b) hereof. The aggregate unpaid principal amount of all Revolving Loans outstanding at any one time made to Borrower shall not exceed the lesser of: (i) the Borrowing Base (plus any overadvances permitted to be outstanding at such time in the sole discretion of Agent pursuant to paragraph 23 hereof and (ii) the Revolving Loan Commitment, in each case, minus the outstanding Letter of Credit Obligations. All Revolving Loans shall be repaid in full upon the earlier to occur of: (i) the end of the Term and (ii) the acceleration of the Liabilities pursuant to paragraph 17 of this Agreement. If at any time the outstanding principal balance of the Revolving Loans made to Borrower exceeds: (i) the Borrowing Base (plus any overadvances permitted to be outstanding at such time in the sole discretion of Agent pursuant to paragraph 23 hereof, provided, however, that, any such overadvance shall be paid by Borrower immediately following demand therefor by Agent) or (ii) the Revolving Loan Commitment, in each case, minus the outstanding Letter of Credit Obligations, Borrower shall immediately, and without the necessity of a demand by Agent, pay to Agent such amount as may be necessary to eliminate such excess, and Agent shall apply such payment, first against overadvances then outstanding and then pro rata according to the Commitment Percentage of each Lender against the outstanding principal balance of the Revolving Loans. Borrower hereby authorizes Agent to charge any of Borrower’s accounts to make any payments of principal, interest and/or fees required by this Agreement. All Revolving Loans shall, in Agent’s sole discretion, be evidenced by one or more Revolving Notes in substantially the form attached hereto as Exhibit 2(a). However, if such Revolving Loans are not so evidenced, such Revolving Loans may be evidenced solely by entries upon the books and records maintained by Agent.

(b) Borrowing Limits. Each Lender, severally and not jointly, shall make Revolving Loans to Borrower up to its Commitment Percentage of the lesser of clause (i) or (ii) below (the amount calculated pursuant to clause (i) below being the “Borrowing Base”):

(i) An amount equal to: (A) the sum of: (1) up to eighty-five percent (85%) (the “Accounts Advance Rate”) of the face amount of Eligible Accounts, plus (2) the lesser of: (x) $6,000,000 or (y) up to 60% (the “Inventory Advance Rate”) of the value of Eligible Inventory consisting of finished goods and raw materials calculated on the basis of the lower of cost or market value on a first in, first out basis, minus (B) such reserves as Agent may establish from time to time in the exercise of its commercially reasonable discretion (provided, however, that, in any event, 100% of the aggregate face amount of all undrawn Stand-by Letters of Credit and 50% of the aggregate face amount of all Documentary Letters of Credit shall be reserved from the availability under the Borrowing Base) minus (without duplication) (C) the outstanding amount of all Letter of Credit Obligations; or

(ii) The Revolving Loan Commitment, minus the outstanding amount of all Letter of Credit Obligations.

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The Advance Rates may be increased or decreased by Agent at any time and from time to time in the exercise of its sole discretion. Borrower consents to any such increases or decreases and acknowledges that decreasing the Advance Rates or imposing reserves may limit or restrict Loans requested by Borrower.

3. LETTER OF CREDIT.

(a) Subject to the terms and conditions hereof, Agent shall: (i) from time to time issue or cause the L/C Issuer to issue Documentary Letters of Credit for the purpose of financing the importation of Eligible Inventory and Stand-by Letters of Credit to secure obligations of Borrower approved by Agent, in each case, issued for the account of Borrower; provided, however, that Agent will not be required to issue or cause to be issued any Letters of Credit to the extent that the issuance of such Letters of Credit would then cause the sum of: (A) the outstanding Revolving Loans plus (B) the Letter of Credit Obligations (with the requested Letter of Credit being deemed to be outstanding for purposes of this calculation) to exceed the lesser of: (x) the Revolving Loan Commitment or (y) the Borrowing Base (plus any overadvances permitted to be outstanding at such time in the sole discretion of Agent, pursuant to paragraph 23 hereof) in effect prior to the issuance of the requested Letter of Credit. The maximum amount of outstanding Documentary Letters of Credit shall not exceed Two Hundred Fifty Thousand Dollars ($250,000) in the aggregate at any time. The maximum amount of outstanding Stand-by Letters of Credit shall not exceed Two Hundred Fifty Thousand Dollars ($250,000) in the aggregate at any time. Each disbursement or payment by the L/C Issuer or Agent related to Letters of Credit shall be deemed to be a Revolving Loan and shall bear interest as a Revolving Loan. Letters of Credit that have not been drawn upon shall not bear interest.

(b) Borrower may from time to time upon notice not later than 12:00 Noon, Chicago Time, at least three (3) Business Days in advance, request Agent to assist Borrower in establishing or opening a Letter of Credit by delivering to Agent at the Payment Office, the L/C Issuer’s standard form of letter of credit application (the “Letter of Credit Application”) completed to the satisfaction of the L/C Issuer; and, such other certificates, documents and other papers and information as Agent may reasonably request.

(c) Each Letter of Credit shall, among other things: (i) provide for the payment of sight drafts when presented for honor thereunder in accordance with the terms thereof and when accompanied by the documents described therein and (ii) have an expiry date not later than twelve (12) months after such Letter of Credit’s date of issuance and in no event later than the last day of the Term. Each Letter of Credit Application and each Letter of Credit shall be subject to: (x) the Uniform Customs and Practice for Documentary Credits (1993 Revision), International Chamber of Commerce Publication No. 500, and any amendments or revision thereof in connection with any Documentary Letter of Credit and (y) ISP 98 in connection with any Standby Letter of Credit, or with respect to any Letter of Credit Application or Letter of Credit, any other rules, regulations and customs prevailing at the place where any such Letter of Credit Application is made or where any such Letter of Credit is available or the drafts are drawn or negotiated and, to the extent not inconsistent therewith, the laws of the State of New York.

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(d) In connection with the issuance of any Letter of Credit, Borrower shall indemnify, save and hold Agent, each Lender and each L/C Issuer harmless from any loss, cost, expense or liability, including, without limitation, payments made by Agent, any Lender or any L/C Issuer, and expenses and reasonable attorneys’ fees incurred by Agent, any Lender or any L/C Issuer arising out of, or in connection with, any Letter of Credit to be issued for the account of Borrower. Borrower shall be bound by the L/C Issuer’s regulations and good faith interpretations of any Letter of Credit issued or created for Borrower’s account, although this interpretation may be different from Borrower’s own; and, neither Agent nor any Lender, any L/C Issuer, nor any of their respective correspondents shall be liable for any error, negligence, or mistakes, whether of omission or commission, in following Borrower’s instructions or those contained in any Letter of Credit or of any modifications, amendments or supplements thereto or in issuing or paying any Letter of Credit, except for Agent’s or any Lender’s or such correspondents’ gross (not mere) negligence or willful misconduct.

(e) Borrower shall authorize and direct the L/C Issuer to name Borrower as the “Account Party” therein and to deliver to Agent all instruments, documents, and other writings and property received by the L/C Issuer pursuant to the Letter of Credit and to accept and rely upon Agent’s instructions and agreements with respect to all matters arising in connection with the Letter of Credit and the application therefor.

(f) In connection with all Letters of Credit issued or caused to be issued by Agent under this Agreement, Borrower hereby appoints Agent, or its designee, as its attorney, with full power and authority: (i) to sign and/or endorse Borrower’s name upon any warehouse or other receipts, letter of credit applications and acceptances; (ii) to sign Borrower’s name on bills of lading; (iii) to clear Inventory through the United States of America Customs Department (“Customs”) in the name of Borrower or Agent or Agent’s designee, and to sign and deliver to Customs officials powers of attorney in the name of Borrower for such purpose; (iv) to complete in the name of Agent, or Agent’s designee, any order, sale or transaction, obtain the necessary documents in connection therewith, and collect the proceeds thereof; (v) to clear and resolve any questions of non-compliance of documents; (vi) to give any instructions as to acceptance or rejection of any documents or goods; (vii) to execute any and all applications for steamship or airways guarantees, indemnities or delivery orders; (viii) to grant any extensions of the maturity of, time of payment for, or time of presentation of, any drafts, acceptances, or documents; and (ix) to agree, subject to the prior written approval of Borrower, to any amendments, renewals, extensions, modifications, changes or cancellation of any of the terms or conditions of any of the applications, Letters of Credit, drafts or acceptances; all in Agent’s sole name, and the L/C Issuer shall be entitled to comply with and honor any and all such documents or instruments executed by or received solely from Agent; all without notice to or consent from Borrower. Neither Agent nor its attorneys will be liable for any acts or omissions nor for any error of judgment or mistakes of fact or law, except for Agent’s or its attorney’s gross (not mere) negligence or willful misconduct. This power, being coupled with an interest, is irrevocable as long as any Letters of Credit remain outstanding.

(g) Neither Agent nor any Lender shall be responsible for: the existence, character, quality, quantity, condition, packing, value or delivery of the goods purporting to be represented by any documents; any differences or variation in the character, quality, quantity, condition, packing, value or delivery of the goods from that expressed in the documents; the

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validity, sufficiency or genuineness of any documents or of any endorsements thereon, even if such documents should in fact prove to be in any or all respects invalid, insufficient, fraudulent, or forged (assuming the absence of any fraud or forgery on the part of Agent, Lenders or their respective agents); the time, place, manner or order in which shipment is made; partial or incomplete shipment, or failure or omission to ship any or all of the goods referred to in the Letters of Credit or documents; any deviation from instructions, delay, default, or fraud by the shipper and/or any one else in connection with the Collateral or the shipping thereof; or any breach of contract between the shipper or vendors and Borrower.

(h) Any necessary import, export or other licenses or certificates for the import or handling of the Collateral will have been promptly procured; all foreign and domestic governmental laws and regulations in regard to the shipment and importation of the Collateral or the financing thereof will have been promptly and fully complied with; any certificates in that regard that Agent may at any time request will be promptly furnished. In this connection, Borrower warrants and represents that all shipments made under any such Letters of Credit are in accordance with the governmental laws and regulations of the countries in which the shipments originate and terminate, and are not prohibited by any such law and regulations. Borrower assumes all risk, liability and responsibility for, and agrees to pay and discharge all present and future local, state, federal or foreign taxes, duties, or levies. Any embargo, restriction, laws, customs or regulations of any country, state, city or other political subdivision where the Collateral is or may be located or wherein payments are to be made or wherein drafts may be drawn, negotiated, accepted, or paid shall be solely at Borrower’s risk, liability and responsibility.

(i) Each Lender shall, in proportion to such Lender’s Commitment Percentage of the aggregate amount of all disbursements made with respect to the Letters of Credit, be deemed to have irrevocably purchased an undivided participation in each Revolving Loan made as a consequence of such disbursement. In the event that at the time a disbursement is made the unpaid balance of Revolving Loans exceeds or would exceed, with the making of such disbursement, the lesser of the Revolving Loan Commitment or the Borrowing Base (plus any overadvances permitted to be outstanding at such time in the sole discretion of Agent pursuant to paragraph 23 hereof), and such disbursement is not reimbursed by Borrower within two (2) Business Days, Agent shall promptly notify each Lender and upon Agent’s demand each Lender shall pay to Agent such Lender’s proportionate share of such unreimbursed disbursement together with such Lender’s proportionate share of Agent’s unreimbursed costs and expenses relating to such unreimbursed disbursement. Upon receipt by Agent of a repayment from Borrower of any amount disbursed by Agent for which Agent had already been reimbursed by the Lenders, Agent shall deliver to each of the Lenders that Lender’s pro rata share of such repayment. Each Lender’s participation commitment shall continue until the last to occur of any of the following events: (A) Agent ceases to be obligated to issue or cause the issuance of Letters of Credit hereunder; (B) no Letter of Credit issued hereunder remains outstanding and uncancelled or (C) all Persons (other than Borrower) have been fully reimbursed for all payments made under or relating to Letters of Credit.

(j) The obligations of a Lender to make payments to the Agent for the account of the Agent or the L/C Issuer with respect to a Letter of Credit shall be irrevocable, without any qualification or exception whatsoever and shall be made in accordance with the

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terms and conditions of this Agreement under all circumstances, including, without limitation, any of the following circumstances:

(A) any lack of validity or enforceability of this Agreement or any of the Other Agreements;

(B) the existence of any claim, setoff, defense or other right which Borrower may have at any time against a beneficiary named in such Letter of Credit or any transferee of such Letter of Credit (or any Person for which any such transferee may be acting), the Agent, L/C Issuer, any Lender, or any other person, whether in connection with this Agreement, such Letter of Credit, the transactions contemplated herein or any related transactions (including any underlying transactions between Borrower or any other party and the beneficiary named in such Letter of Credit);

(C) any draft, certificate or any other document presented under such 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;

(D) the surrender or impairment of any security for the performance or observance of any of the terms of this Agreement or any of the Other Agreements;

(E) any failure by the Agent to provide any notices required pursuant to this Agreement relating to such Letter of Credit;

(F) any payment by the L/C Issuer under any of the Letters of Credit against presentation of a draft or certificate which does not comply with the terms of such Letter of Credit (if, in the good faith opinion of the L/C Issuer, such prepayment is deemed to be appropriate); or

(G) the occurrence of any Default or Event of Default,

provided, however, that after paying in full its reimbursement obligation hereunder, nothing herein shall adversely affect the right of Borrower or any Lender, as the case may be, to commence any proceeding against such L/C Issuer for any wrongful disbursement made by such L/C Issuer under a Letter of Credit as a result of acts or omissions constituting gross (not mere) negligence or willful misconduct on the part of such L/C issuer.

4. MANDATORY PREPAYMENTS. If Borrower sells any Equipment, or if any of the Collateral is damaged, destroyed or taken by condemnation, Borrower shall pay to Agent for its benefit and for the ratable benefit of Lenders, unless otherwise specifically provided herein or otherwise agreed to by Agent and Borrower, as and when received by Borrower and as a mandatory prepayment of the Loans, to be applied against the outstanding Revolving Loans (subject to Borrower’s ability to reborrow Revolving Loans in accordance with the terms of this agreement) a sum equal to the proceeds received by Borrower from such sale or such damage, destruction or condemnation, provided, however, that without Agent’s consent, unless and until an Event of Default has occurred and is continuing: (a) obsolete or worn out Equipment may be sold or otherwise disposed of by Borrower and the proceeds thereof may be retained by

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Borrower, so long as the fair market value of any such Equipment sold or otherwise disposed of in any single transaction is less than $50,000, and the fair market value, in the aggregate, of all such Equipment sold or otherwise disposed of by Borrower during any twelve-month period is less than $100,000; and (b) proceeds of Collateral arising from the damage, destruction or condemnation thereof may be retained by Borrower and used by Borrower to repair, restore or replace such Collateral, as the case may be, so long as the fair market value of any such Collateral damaged, destroyed or condemned in any single incident is less than $50,000 and the fair market value, in the aggregate, of all such Collateral owned by Borrower and damaged, destroyed or condemned during any twelve-month period is less than $100,000.

5. INTEREST, FEES AND CHARGES.

(a) Rate of Interest. Interest accrued on the Loans shall be due on the earliest of: (i) the first day of each month (for the immediately preceding month), computed through the last calendar day of the preceding month, (ii) the occurrence of an Event of Default in consequence of which Agent elects to accelerate the maturity and payment of the Liabilities, or (iii) termination of this Agreement pursuant to paragraph 12 hereof. Interest shall accrue on the unpaid principal amount of the Revolving Loans made to Borrower outstanding at the end of each day at a fluctuating rate of interest per annum equal to one percent (1%) above the Prime Rate. The rate of interest shall increase or decrease by an amount equal to any increase or decrease in the Prime Rate, effective as of the opening of business on the day that any such change in the Prime Rate occurs. Upon and after the occurrence of an Event of Default and during the continuation thereof the principal amount of all Loans shall bear interest on demand at a rate per annum equal to the rate of interest then in effect under this paragraph 5(a) plus two percent (2%).

(b) Computation of Interest and Fees. Interest and collection charges hereunder shall be calculated daily and shall be computed on the actual number of days elapsed over a year consisting of three hundred and sixty (360) days. For the purpose of computing interest hereunder, all items of payment received by Agent shall be deemed applied by Agent on account of the Liabilities (subject to final payment of such items) on the second Business Day after receipt by Agent of good funds in Agent’s account located in Chicago, Illinois.

(c) Maximum Interest. Notwithstanding anything to the contrary contained elsewhere in this Agreement or in any Other Agreement, the parties hereto hereby agree that all agreements between them under this Agreement and the Other Agreements, whether now existing or hereafter arising and whether written or oral, are expressly limited so that in no contingency or event whatsoever shall the amount paid, or agreed to be paid, to the Agent or any Lender for the use, forbearance, or detention of the money loaned to the Borrower and evidenced hereby or obligation contained herein or therein, exceed the maximum non-usurious interest rate, if any, that at any time or from time to time may be contracted for, taken, reserved, charged or received on the Liabilities, under the laws of the State of New York (or the laws of any other jurisdiction whose laws may be mandatory applicable notwithstanding other provisions of this Agreement and the Other Agreements), or under applicable federal laws which may presently or hereafter be in effect and which allow a higher maximum non-usurious interest rate that under the laws of the State of New York (or such other jurisdiction), in any case after taking into account, to the extent permitted by applicable law, any and all relevant payments or charges

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under this Agreement and the Other Agreements executed in connection herewith, and any available exemptions, exceptions and exclusions (the “Highest Lawful Rate”). If due to any circumstance whatsoever, fulfillment of any provision of this Agreement or any of the Other Agreements at the time performance of such provision shall be due shall exceed the Highest Lawful Rate, then automatically, the obligation to be fulfilled shall be modified or reduced to the extent necessary to limit such interest to the Highest Lawful Rate, and if from any such circumstance Agent or any Lender should ever receive anything of value deemed interest by applicable law which would exceed the Highest Lawful Rate, such principal amount then outstanding hereunder or on account of any other then outstanding Liabilities and not to the payment of interest, or if such excessive interest exceeds the principal unpaid balance then outstanding hereunder and such other then outstanding Liabilities, such excess shall be refunded to Borrower. All sums paid or agreed to be paid to Agent or the Lenders for the use, forbearance, or detention of the Liabilities and other Indebtedness of Borrower to the Lenders shall, to the extent permitted by applicable law, be amortized, prorated, allocated and spread throughout the full term of such Indebtedness, until payment in full thereof, so that the actual rate of interest on account of all such Indebtedness does not exceed the Highest Lawful Rate throughout the entire term of such Indebtedness. The terms and provisions of this paragraph shall control every other provision of this Agreement, the Other Agreements and all other agreements among the parties hereto.

(d) Letter of Credit Fees. Borrower shall remit to Agent for its own account a letter of credit fee equal to two percent (2%) per annum (the “Letter of Credit Fee”) on the aggregate undrawn face amount of all outstanding Letters of Credit issued for the account of Borrower, which fee shall be payable monthly in arrears on each day that interest is payable hereunder. Borrower shall also pay on demand the normal and customary administrative charges for issuance, amendment, negotiation, renewal or extension of any Letter of Credit imposed by the L/C Issuer. Upon the occurrence and during the continuance of an Event of Default, all Letter of Credit Fees shall be payable on demand at a rate equal to the Letter of Credit Fees under this paragraph 5(d) then in effect plus two percent (2%) per annum in excess of the Letter of Credit Fee on the aggregate undrawn face amounts thereof.

(e) Closing Fee. Borrower shall pay to Agent for its own account a closing fee of One Hundred Thousand Dollars ($100,000), which fee shall be deemed fully earned, non-refundable and due on the Closing Date.

(f) Unused Line Fee. Borrower shall pay to Agent for the ratable benefit of Lenders at the end of each month, in arrears, and on the last day of the Term an Unused Line Fee equal to one-half of one percent (1/2%) per annum on the daily average amount by which the Revolving Loan Commitment exceeds the sum of: (i) the outstanding principal balance of the Revolving Loans and (ii) the outstanding Letter of Credit Obligations. The Unused Line Fee shall accrue from the Closing Date until the last day of the Term.

(g) Collateral Management Fee. Borrower shall pay to Agent for its own account an annual collateral management fee of Twenty-Four Thousand Dollars ($24,000) per annum, payable quarterly in arrears, on the last day of each October, January, April and July, subject to the earlier termination of this Agreement, which fee shall be deemed earned in full on

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the Closing Date and on each anniversary thereafter and shall not be subject to rebate, refund or proration for any reason.

(h) Examination and Appraisal Fees. In addition to the costs and expenses described in paragraph 5(g) hereof, Borrower shall pay to Agent for its own account an examination fee of $750 per Person per day charged by Agent for each examination performed by or at Agent’s direction of Borrower’s books and records and Collateral and such other matters as Agent shall deem appropriate in its commercially reasonable judgment together with each such Person’s out of pocket expenses incurred in connection with each such examination, each such fee and out of pocket expenses to be paid upon the completion of each such examination; provided, however, that so long as no Event of Default or Default has occurred and is continuing, the examination fee referred to above will be $400 per Person per day and the total of such examination fees shall not exceed $12,000 during each fiscal year of Borrower; provided, further, however, that such limitation shall not apply to any expenses incurred by any such Person.

(i) Capital Adequacy Charge. If Agent or any Lender shall have determined that the adoption of any law, rule or regulation regarding capital adequacy, or any change therein or in the interpretation or application thereof, or compliance by Agent or any Lender with any request or directive regarding capital adequacy (whether or not having the force of law) from any central bank or governmental authority enacted after the Closing Date, does or shall have the effect of reducing the rate of return on Agent’s or any Lender’s capital as a consequence of its obligations hereunder to a level below that which Agent could have achieved but for such adoption, change or compliance (taking into consideration Agent’s or such Lender’s policies with respect to capital adequacy) by a material amount, then from time to time, after submission by Agent to Borrower of a written demand therefor (“Capital Adequacy Demand”) together with the certificate described below, Borrower shall pay to Agent or such Lender such additional amount or amounts (“Capital Adequacy Charge”) as will compensate Agent or such Lender for such reduction, such Capital Adequacy Demand to be made with reasonable promptness following such determination. A certificate of Agent claiming entitlement to payment as set forth above shall be conclusive in the absence of manifest error. Such certificate shall set forth the nature of the occurrence giving rise to such reduction, the amount of the Capital Adequacy Charge to be paid to Agent or such Lender, and the method by which such amount was determined. In determining such amount, Agent or such Lender may use any reasonable averaging and attribution method, applied on a non-discriminatory basis.

6. LOAN ADMINISTRATION.

(a) Loan Requests. A request for a Revolving Loan shall be made or shall be deemed to be made, each in the following manner: (i) Borrower shall give Agent same day written notice, no later than 1:00 P.M. (Chicago time) of such day, of its intention to borrow, a Revolving Loan, in which notice Borrower shall specify the amount of the proposed borrowing and the proposed borrowing date, provided, however, that no such request may be made at a time when there exists a Default or an Event of Default; and (ii) the coming due of any amount required to be paid under this Agreement or any Note, whether on account of interest or for any other Liability, shall be deemed irrevocably to be an authorized request for a Revolving Loan on the due date thereof in the amount required to pay such interest or other Liability. As an

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accommodation to Borrower, Agent may permit electronic transmittals of requests for Revolving Loans, instructions, authorizations, agreements or reports to Agent by Borrower; provided, however, that any request for a Revolving Loan or disbursement instruction shall be signed only by an officer or officers of Borrower whose name, incumbency and signature appear on the most recent list of authorized officers delivered from time to time by Borrower to Lender (each, a “Loan Request Authorization”) and, until such a Loan Request Authorization is delivered to Lender, all names set forth on the secretary’s certificate delivered to Lender in connection with this Agreement are acknowledged to be so authorized, and Lender is irrevocably authorized to rely thereon. Borrower specifically directs Agent not to accept or act upon telephonic communications from Borrower. Neither Agent nor any Lender shall have any liability to Borrower for any loss or damage suffered by Borrower as a result of Agent’s honoring of any requests, execution of any instructions, authorizations or agreements or reliance on any reports communicated to it electronically or otherwise and purporting to have been sent to Agent by Borrower in the manner and by the authorized officer provided above, and Agent shall have no duty to verify the origin of any such communication or the authority of the Person sending it, except in connection with its review of the most recent Loan Request Authorization delivered to Lender by Borrower. Each notice of borrowing shall be irrevocable by and binding on Borrower.

(b) Disbursement. Borrower hereby irrevocably authorizes Agent to disburse the proceeds of each Revolving Loan requested by Borrower, or deemed to be requested by Borrower, as follows: (i) the proceeds of each Revolving Loan requested under paragraph 6(a)(i) shall be disbursed by Agent in lawful money of the United States of America in immediately available funds, in the case of the initial borrowing, in accordance with the terms of the written disbursement letter from Borrower, and in the case of each subsequent borrowing, by wire transfer to such bank account as may be agreed upon by Borrower and Agent from time to time, or elsewhere if pursuant to a written direction from Borrower; and (ii) the proceeds of each Revolving Loan requested under paragraph 6(a)(ii) shall be disbursed by Agent by way of direct payment of the relevant interest or other Liability. Each borrowing of Revolving Loans shall be advanced according to the Commitment Percentages of the Lenders. The Term Loan shall be advanced according to the Commitment Percentages of the Lenders.

(c) Each payment (including each prepayment) by Borrower on account of the principal of and interest on the Revolving Note shall be applied to the Revolving Loans, pro rata according to the Commitment Percentages of the Lenders. Except as expressly provided herein, all payments (including prepayments) to be made by Borrower on account of principal, interest and fees shall be made without set-off or counterclaim and shall be made to Agent on behalf of the Lenders to the Payment Office, in each case on or prior to 1:00 P.M. (Chicago time), in Dollars and in immediately available funds.

(d) (i) Notwithstanding anything to the contrary contained in subparagraphs (b) and (c) hereof, commencing with the first Business Day following the Closing Date, each borrowing of Revolving Loans shall be advanced by Agent and each payment by Borrower on account of Revolving Loans shall be applied first to those Revolving Loans made by Agent. On or before 1:00 P.M. (Chicago time) on each Settlement Date commencing with the first Settlement Date following the Closing Date, Agent and Lenders shall make certain payments as follows: (A) if the aggregate amount of new Revolving Loans made by Agent

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during the period commencing with the later of: (x) the Closing Date and (y) the immediately preceding Settlement Date and ending on the day immediately preceding the current Settlement Date (such period, the “Settlement Period”) exceeds the aggregate amount of repayments applied to outstanding Revolving Loans during such preceding Settlement Period, then each Lender shall provide Agent with funds in an amount equal to its Commitment Percentage of the difference between: (x) such Revolving Loans and (y) such repayments and (B) if the aggregate amount of repayments applied to outstanding Revolving Loans during such Settlement Period exceeds the aggregate amount of new Revolving Loans made during such Settlement Period, then Agent shall provide each Lender with its Commitment Percentage of the difference between (x) such repayments and (y) such Revolving Loans.

(ii) Each Lender shall be entitled to earn interest at the interest rate provided in paragraph 5(a) on outstanding Loans which it has funded.

(iii) Promptly following each Settlement Date, Agent shall submit to each Lender a certificate with respect to payments received and Loans made during the Settlement Period immediately preceding such Settlement Date. Such certificate of Agent shall be conclusive in the absence of manifest error.

(e) If any Lender or Participant (a “benefited Lender”) shall at any time receive any payment of all or part of its Loans, or interest thereon, or receive any Collateral in respect thereof (whether voluntarily or involuntarily or by set-off) in a greater proportion than any such payment to and Collateral received by any other Lender, if any, in respect of such other Lender’s Loans, or interest thereon, and such greater proportionate payment or receipt of Collateral is not expressly permitted hereunder, such benefited Lender shall purchase for cash from the other Lenders such portion of each such other Lender’s Loans, or shall provide such other Lender with the benefits of any such Collateral, or the proceeds thereof, as shall be necessary to cause such benefited Lender to share the excess payment or benefits of such Collateral or proceeds ratably with each of the Lenders; provided, however, that if all or any portion of such excess payment or benefits is thereafter recovered from such benefited Lender, such purchase shall be rescinded, and the purchase price and benefits returned, to the extent of such recovery, but without interest. Each Lender 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.

(f) Unless Agent shall have been notified by telephone, confirmed in writing, by any Lender that such Lender will not make the amount which would constitute its Commitment Percentage of the Loans available to Agent, Agent may (but shall not be obligated to) assume that such Lender shall make such amount available to Agent and, in reliance upon such assumption, make available to Borrower a corresponding amount. Agent will promptly notify Borrower of its receipt of any such notice from a Lender. If such amount is made available to Agent on a date after a Settlement Date, such Lender shall pay to Agent on demand an amount equal to the product of: (i) the daily average federal funds rate (computed on the basis of a year of 360 days) during such period as quoted by Agent, times (ii) such amount, times (iii) the number of days from and including such Settlement Date to the date on which such amount becomes immediately available to Agent. A certificate of Agent submitted to any Lender with respect to any amounts owing under this paragraph 6(f) shall be conclusive, in the absence of

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manifest error. If such amount is not in fact made available to Agent by such Lender within three (3) Business Days after such Settlement Date, Agent shall be entitled to recover such an amount, with interest thereon at the rate per annum then applicable to Revolving Loans hereunder, on demand from Borrower; provided, however, that Agent’s right to such recovery shall not prejudice or otherwise adversely affect Borrower’s rights (if any) against such Lender.

(g) Notwithstanding anything to the contrary contained herein, in the event any Lender: (i) has refused (which refusal constitutes a breach by such Lender of its obligations under this Agreement) to make available its Commitment Percentage of any Loan or (ii) notifies either Agent or Borrower that it does not intend to make available its Commitment Percentage of any Loan (if the actual refusal would constitute a breach by such Lender of its obligations under this Agreement) (each, a “Lender Default”), all rights and obligations hereunder of such Lender (a “Defaulting Lender”) as to which a Lender Default is in effect and of the other parties hereto shall be modified to the extent of the express provisions of this paragraph 6(g) while such Lender Default remains in effect.

(h) Revolving Loans shall be allocated pro rata among Lenders (the “Non-Defaulting Lenders”) which are not Defaulting Lenders in accordance with their respective Commitment Percentages, and no Commitment Percentage of any Lender or any pro rata share of any Revolving Loans required to be advanced by any Lender shall be increased as a result of such Lender Default. Amounts received in respect of principal of Loans shall be applied to reduce Loans of each Lender pro rata based on the aggregate of the outstanding Loans of all Lenders at the time of such application; provided, that, such amount shall not be applied to any Loans of a Defaulting Lender at any time when, and to the extent that, the aggregate amount of Loans of any Lender that is not a Defaulting Lender exceeds such Lender’s Commitment Percentage of all Loans then outstanding.

(i) A Defaulting Lender shall not be entitled to: (A) give instructions to Agent or to approve, disapprove, consent to or vote on any matters relating to this Agreement or the Other Agreements or (B) receive or earn unused line fees which are due and payable during the continuation of a Lender Default. All amendments, waivers and other modifications of this Agreement and the Other Agreement may be made without regard to a Defaulting Lender and, solely for purposes of the definition of “Required Lenders”, a Defaulting Lender shall be deemed not to be a Lender and not to have Loans outstanding.

(j) Other than as expressly set forth in this paragraph 6(j), the rights and obligations of a Defaulting Lender (including the obligation to indemnify Agent) and the other parties hereto shall remain unchanged. Nothing in this paragraph 6(j) shall be deemed to release any Defaulting Lender from its obligations under this Agreement or the Other Agreements, shall alter such obligations, shall operate as a waiver of any default by such Defaulting Lender hereunder, or shall prejudice any rights which Borrower, Agent or any Lender may have against any Defaulting Lender as a result of any default by such Defaulting Lender hereunder.

(k) In the event a Defaulting Lender retroactively cures, to the satisfaction of Agent, the breach which caused such Lender to become a Defaulting Lender, such Defaulting Lender shall no longer be a Defaulting Lender and shall be treated as a Lender under this Agreement.

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(l) In the event a Defaulting Lender fails to retroactively cure, to the satisfaction of Agent and Borrower, the breach which caused a Lender to become a Defaulting Lender within five (5) Business Days after the occurrence of such default (the “Defaulting Lender Cure Period”), then Agent may, but shall not be obligated to, require such Defaulting Lender to assign its interest in the Loans to Agent or to another financial institution designated by Agent (the “Designated Lender”) for a purchase price equal to the outstanding principal amount of all Loans made by such Defaulting Lender plus accrued and unpaid interest and fees (other than any unused line fees due during the continuance of such Lender Default) due to such Defaulting Lender, which interest and fees shall be paid to the Defaulting Lender when collected from Borrower. In the event Agent so elects to require any Defaulting Lender to assign its interest to Agent or to the Designated Lender, as applicable, Agent will notify such Defaulting Lender at any time after the expiration of the Defaulting Lender Cure Period, and such Defaulting Lender shall assign its interest to Agent or the Designated Lender, as applicable, no later than five (5) days following receipt of such notice pursuant to a Commitment Transfer Supplement executed by such Defaulting Lender, Agent or the Designated Lender, as applicable, and Agent. Upon: (A) the execution of the Commitment Transfer Supplement, (B) payment of the purchase price set forth above, (C) recordation of the assignment in the Register by Agent pursuant to paragraph 24(c) hereof, and (D) if so requested by Agent or the Designated Lender (as applicable), receipt by such Person of replacement Notes, Agent or the Designated Lender (as applicable) shall increase its Commitment Percentage hereunder or shall become a Lender hereunder, as applicable, and the Defaulting Lender shall cease to be a Lender hereunder except with respect to indemnification provisions set forth herein.

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7. GRANT OF SECURITY INTEREST TO AGENT. As security for the payment of all Loans now or in the future made by Agent and Lenders to Borrower hereunder and for the payment or other satisfaction of all other Liabilities, Borrower hereby assigns and grants to Agent for its benefit and for the ratable benefit of Lenders a continuing security interest in all assets of Borrower, whether now or hereafter owned, existing, acquired or arising and wherever now or hereafter located including without limitation: (a) all Accounts (whether or not Eligible Accounts including, without limitation, Health Care Insurance Receivables)) and all Goods whose sale, lease or other disposition by Borrower has given rise to Accounts and have been returned to or repossessed or stopped in transit by Borrower; (b) all Chattel Paper, Instruments (including without limitation, promissory notes), Documents and General Intangibles (including, without limitation, Payment Intangibles); (c) all Inventory (whether or not Eligible Inventory or Eligible L/C Inventory); (d) all Goods (other than Inventory) including, without limitation, Equipment, vehicles and fixtures; (e) all deposits and cash and any other property of Borrower now or hereafter in the possession, custody or control of Agent, any Lender or any agent or any parent, affiliate or subsidiary of Agent or such Lender or any participant with Agent or such Lender in the Loans for any purpose (whether for safekeeping, deposit, collection, custody, pledge, transmission or otherwise); (f) all Investment Property (excluding stock or other equity in Borrower’s Subsidiaries or joint ventures); (g) all Customer Lists; (h) all Real Property; (i) all Deposit Accounts; (j) all Supporting Obligations; (k) all Letter of Credit Rights; (l) any Commercial Tort Claim; and (m) all additions and accessions to, substitutions for, and replacements, products and proceeds of the foregoing property, including, without limitation, proceeds of all insurance policies insuring the foregoing property, and all of Borrower’s books and records relating to any of the foregoing and to Borrower’s business.

8A. CONCERNING ARTICLE 9 OF THE UNIFORM COMMERCIAL CODE .

(a) Commercial Tort Claim. If Borrower shall at any time acquire a Commercial Tort Claim, Borrower shall immediately notify Agent in a writing signed by Borrower of the brief details thereof and grant to Agent in such writing a security interest therein and in the proceeds thereof, all upon the terms of this Agreement, with such writing to be in form and substance satisfactory to Agent.

(b) Perfection by Filing. Agent may at any time and from time to time, pursuant to the provisions of paragraph 8 hereof, file financing statements, continuation statements and amendments thereto that describe the Collateral as all assets of Borrower or words of similar effect and which contain any other information required by Part 5 of Article 9 of the UCC for the sufficiency or filing office acceptance of any financing statement, continuation statement or amendment, including whether Borrower is an organization, the type of organization and any organization identification number issued to Borrower. Borrower agrees to furnish any such information to Agent promptly upon Agent’s request therefor. Any such financing statements, continuation statements and/or amendments may be signed by Agent on behalf of Borrower or may be filed without any signatures, as provided in this Agreement, and may be filed at any time in any jurisdiction whether or not Revised Article 9 is then in effect in that jurisdiction.

(c) Other Perfection, etc. Borrower shall at any time and from time to time, take such steps as Agent may request: (a) for Agent to obtain an acknowledgement, in form and

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substance satisfactory to Agent, of each bailee having possession of any Collateral that such bailee holds such Collateral for the benefit of Agent, (b) for Agent to obtain “control” of any Investment Property, Deposit Accounts, Letter-of-Credit Rights or electronic Chattel Paper (with corresponding provisions in Rev. §§9-104, 9-105, 9-106 and 9-107 of the UCC relating to what constitutes “control” for such items of Collateral), with any agreements establishing control to be in form and substance satisfactory to Agent, and (c) to insure the continued perfection and priority of Agent’s security interest in any of the Collateral and the preservation of its rights therein.

(d) Savings Clause. Nothing contained in this paragraph 8A shall be construed to narrow the scope of Agent’s security interest in any of the Collateral or the perfection or priority thereof or to impair or otherwise limit any of the rights, powers, privileges or remedies of Agent or any Lender hereunder.

8. PRESERVATION OF COLLATERAL AND PERFECTION OF SECURITY INTERESTS THEREIN. Borrower shall, at Agent’s request, at any time and from time to time, execute and deliver to Agent such financing statements, documents and other agreements and instruments (and pay the cost of filing or recording the same in all public offices deemed reasonably necessary or desirable by Agent) and do such other acts and things as Agent may deem necessary or desirable in order to establish and maintain a valid, attached and perfected security interest in the Collateral in favor of Agent for its benefit and for the ratable benefit of Lenders (free and clear of all other liens, claims and rights of third parties whatsoever, whether voluntarily or involuntarily created, except Permitted Liens) to secure payment of the Liabilities, and in order to facilitate the collection of the Collateral. Borrower irrevocably hereby makes, constitutes and appoints Agent (and all Persons designated by Agent for that purpose) as Borrower’s true and lawful attorney and agent-in-fact to execute and/or file such financing statements (with or without signatures thereon), documents and other agreements and instruments and do such other acts and things as may be necessary to preserve and perfect Agent’s security interest in the Collateral. Borrower further agrees that a carbon, photographic, photostatic or other reproduction of this Agreement or of a financing statement shall be sufficient as a financing statement.

9. POSSESSION OF COLLATERAL AND RELATED MATTERS. Until an Event of Default has occurred and is continuing, Borrower shall have the right, except as otherwise provided for in this Agreement, in the ordinary course of Borrower’s business, to: (a) sell, lease or furnish under contracts of service any of Borrower’s Inventory normally held by Borrower for any such purpose, and (b) use and consume any raw materials, work in process or other materials normally held by Borrower for such purpose, provided, however, that a sale in the ordinary course of business shall not include any transfer or sale in satisfaction, partial or complete, of a debt owed by Borrower.

10. COLLECTIONS.

(a) Establishment of Lockbox and Blocked Account. Borrower shall direct all of its Account Debtors to make all payments on the Accounts directly to a post office box (“Lock Box”) with a financial institution acceptable to, and in the name and under exclusive control of Agent. Borrower shall establish an account (“Blocked Account”) in Agent’s name for the benefit

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of Borrower with a financial institution acceptable to Agent, into which all payments received in the Lock Box shall be deposited, and into which Borrower will immediately deposit all payments received by Borrower for Inventory or services sold, leased or rendered by Borrower and received by Borrower in the identical form in which such payments were received, whether by cash or check. If Borrower, any Affiliate or Subsidiary of Borrower, or any shareholder, officer, director, employee or agent of Borrower or any Affiliate or Subsidiary, or any other Person acting for or in concert with Borrower shall receive any monies, checks, notes, drafts or other payments relating to or as proceeds of Accounts or other Collateral, Borrower and each such Person shall receive all such items for the benefit of, and as the sole and exclusive property of, Agent for its benefit and for the ratable benefit of Lenders and, as soon as practicable after receipt thereof (but in no event later than 1:00 P.M. (Chicago time) on the next Business Day), shall remit the same (or cause the same to be remitted) in kind to the Blocked Account. Each financial institution with which a Lock Box or Blocked Account is established shall acknowledge and agree, in a manner satisfactory to Agent for its benefit and for the ratable benefit of Lenders, that the amounts on deposit in such Lock Box and such Blocked Account are the sole and exclusive property of Agent, that such financial institution has no right to setoff against such Lock Box or Blocked Account or against any other account maintained by such financial institution into which the contents of such Blocked Account are transferred, and that such financial institution shall wire, or otherwise transfer in immediately available funds in a manner satisfactory to Agent, funds deposited in the Blocked Account on a daily basis as such funds are collected. Borrower agrees that all payments made to the Blocked Account established by Borrower or otherwise received by Agent, whether in respect of the Accounts of Borrower or as proceeds of other Collateral of Borrower or otherwise, will be applied on account of the Revolving Loans and also on account of such other due and payable Liabilities of Borrower as Agent shall determine in accordance with the terms of this Agreement. Borrower agrees to pay all fees, costs and expenses which Borrower incurs in connection with opening and maintaining a Lock Box and Blocked Account. All of such fees, costs and expenses which remain unpaid by Borrower pursuant to any Lock Box or Blocked Account Agreement with Borrower, to the extent same shall have been paid by Agent hereunder, shall constitute Revolving Loans hereunder, shall be payable to Agent for its benefit and for the ratable benefit of Lenders by Borrower upon demand, and, until paid, shall bear interest at the highest rate then applicable to Revolving Loans hereunder. All checks, drafts, instruments and other items of payment or proceeds of Collateral delivered to Agent in kind shall be endorsed by Borrower to Agent, and, if that endorsement of any such item shall not be made for any reason, Agent is hereby irrevocably authorized to endorse the same on Borrower’s behalf. For the purpose of this paragraph, Borrower irrevocably hereby makes, constitutes and appoints Agent (and all Persons designated by Agent for that purpose) as Borrower’s true and lawful attorney and agent-in-fact: (i) to endorse Borrower’s name upon said items of payment and/or proceeds of Collateral of Borrower and upon any Chattel Paper, document, instrument, invoice or similar document or agreement relating to any Account of Borrower or goods pertaining thereto; (ii) to take control in any manner of any item of payment or proceeds thereof; (iii) to have access to any lock box or postal box into which any of Borrower’s mail is deposited; and (iv) open and process all mail addressed to Borrower and deposited therein, provided, however, that Agent shall not exercise any such powers described in clauses (ii) and (iv) unless and until an Event of Default has occurred, and provided, further, that in the exercise of its rights hereunder, Agent shall, as soon as practicable, deliver or cause to be delivered to Borrower, any mail that does not constitute payment on any

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Account or any other Collateral or proceeds thereof or any other cash. Notwithstanding anything to the contrary contained herein, Borrower shall cause all of its Subsidiaries and Affiliates to wire all remittances and other payments due Borrower from such Subsidiaries and Affiliates directly to the Blocked Account.

(b) Collection of Accounts. Agent may, at any time and from time to time after the occurrence and during the continuation of an Event of Default, whether before or after notification to any Account Debtor and whether before or after the maturity of any of the Liabilities: (i) enforce collection of any of Borrower’s Accounts, other amounts owed to Borrower or contract rights by suit or otherwise; (ii) exercise all of Borrower’s rights and remedies with respect to proceedings brought to collect any Accounts or other amounts owed to Borrower; (iii) surrender, release or exchange all or any part of any Accounts of Borrower or other amounts owed to Borrower, or compromise or extend or renew for any period (whether or not longer than the original period) any Indebtedness thereunder; (iv) sell or assign any Account of Borrower or other amounts owed to Borrower upon such terms, for such amount and at such time or times as Agent deems advisable; (v) prepare, file and sign Borrower’s name on any proof of claim in bankruptcy or other similar document against any Account Debtor indebted on an Account of Borrower or other Person obligated to Borrower; and (vi) do all other acts and things which are necessary, in Agent’s sole discretion, to fulfill Borrower’s obligations under this Agreement and to allow Agent to collect the Accounts or other amounts owed to Borrower. In addition to any other provision hereof, Agent may at any time on or after the occurrence and during the continuation of an Event of Default, at Borrower’s expense, notify any parties obligated on any of the Accounts of Borrower to make payment directly to Agent of any amounts due or to become due thereunder.

(c) Application of Proceeds. Agent shall, within two (2) Business Days after receipt by Agent at its office in Chicago, Illinois of cash or other immediately available funds from collections of items of payment and proceeds of any Collateral, apply the whole or any part of such collections or proceeds against the Liabilities in such order as Agent shall determine in its sole discretion.

(d) Acceptance of Assignment. In its sole credit judgment, without waiving or releasing any obligation, liability or duty of Borrower under this Agreement or the Other Agreements or any Event of Default, at any time or times hereafter, Agent may (but shall not be obligated to) pay, acquire or accept an assignment of any security interest, lien, encumbrance or claim asserted by any Person in, upon or against the Collateral. All sums paid by Agent in respect thereof and all costs, fees and expenses (including without limitation reasonable attorney fees, all court costs and all other charges relating thereto) incurred by Agent shall constitute Revolving Loans, payable by Borrower to Agent on demand and, until paid, shall bear interest at the highest rate then applicable to Revolving Loans hereunder.

(e) Delivery of Documents and Instruments. Immediately upon Borrower’s receipt of any portion of the Collateral evidenced by an agreement, instrument or document including, without limitation, any Chattel Paper, Borrower shall deliver the original thereof to Agent together with an appropriate endorsement or other specific evidence of assignment thereof to Agent (in form and substance acceptable to Agent). If an endorsement or assignment of any

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such items shall not be made for any reason, Agent is hereby irrevocably authorized, as Borrower’s attorney and agent-in-fact, to endorse or assign the same on Borrower’s behalf.

11. SCHEDULES AND REPORTS.

Borrower shall furnish or cause to be furnished to Agent the following:

(a) As soon as practicable and in any event on Tuesday of each week, a Borrowing Base Certificate (which shall be calculated as of the last day of the immediately preceding Week and which shall not be binding upon Agent or restrictive of Agent’s rights under this Agreement). In addition, Borrower shall provide Agent with a written report each Week hereafter, reflecting the activity of Borrower with respect to sales, collections of Accounts and credits issued by Borrower for the immediately preceding Week. Such report shall be in a form and with such specificity as is satisfactory to Agent and shall contain such additional information as Agent may reasonably require concerning Accounts and Inventory included, described or referred to in such weekly report and any other documents in connection therewith requested by Agent, including without limitation but only if specifically requested by Agent, copies of all invoices prepared in connection with such Accounts.

(b) As soon as practicable and in any event within thirty (30) days following the end of each calendar month: (i) statements of income and statements of cash flow of Borrower for each such month and for the period from the beginning of the then current Fiscal Year to the end of such month, (ii) balance sheets of Borrower as of the end of such month, and (iii) with respect to such statements of income and balance sheets, in comparative form, figures for the corresponding periods in the preceding Fiscal Year, all in reasonable detail and certified by the chief financial officer of Borrower that such statements fairly present the financial condition of Borrower in accordance with GAAP, subject to changes resulting from normal and recurring year-end adjustments that individually and in the aggregate are not material to the business of Borrower and the absence of footnotes, together with detailed computations of Borrower’s compliance with the covenants set forth in this Agreement.

(c) As soon as practicable and in any event within forty-five (45) days following the end of each fiscal quarter (other than the fourth fiscal quarter of each fiscal year): (i) statements of income and statements of cash flow of Borrower for each such quarter and for the period from the beginning of the then current Fiscal Year to the end of such quarter, (ii) balance sheets of Borrower as of the end of such quarter, and (iii) with respect to such statements of income and balance sheets, in comparative form, figures for the corresponding periods in the preceding Fiscal Year, all in reasonable detail and certified by the chief financial officer of Borrower that such statements fairly present the financial condition of Borrower in accordance with GAAP, subject to changes resulting from normal and recurring year-end adjustments that individually and in the aggregate are not material to the business of Borrower and the absence of footnotes, together with detailed computations of Borrower’s compliance with the covenants set forth in this Agreement.

(d) As soon as practicable and in any event within fifteen (15) days following the end of each calendar month and at such other times as may be requested by Agent from time to time: (i) a schedule identifying by age each Account of Borrower together with copies of the

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invoices when requested by Agent (with evidence of shipment attached) pertaining to each such Account and a schedule identifying by age each account payable of Borrower, (ii) a detailed aged trial balance of Borrower’s Accounts (“Accounts Trial Balance”) in form and substance satisfactory to Agent in its reasonable discretion, including, without limitation, the names and addresses of all Account Debtors of Borrower, (iii) a summary and detail of accounts payable (such Accounts and accounts payable divided into such time intervals as Agent may require in its reasonable discretion), including a listing of any held checks, (iv) such additional schedules, certificates, reports and information with respect to the Collateral as Agent may from time to time require; (v) a copy of any statement received by Borrower in connection with the Lockbox and/or the Blocked Account; (vi) an assignment of any or all items of Collateral to Agent and (vii) the general ledger inventory account balance, a perpetual inventory report and Agent’s standard form of Inventory report then in effect, for Borrower by each category of Inventory, together with a description of the change in each category of Inventory, in each case, for such immediately preceding month (or other applicable period). Agent, through its officers, employees or agents, shall have the right, at any time and from time to time in Agent’s name, in the name of a nominee of Agent or in Borrower’s name, to verify the validity, amount or any other matter relating to any of Borrower’s Accounts, by mail, telephone, telegraph or otherwise. Borrower shall reimburse Agent, on demand, for all reasonable costs, fees and expenses incurred by Agent in this regard. Borrower shall immediately notify Agent of any event causing loss or depreciation in value of Borrower’s Inventory (other than normal depreciation occurring in the ordinary course of business).

(e) As soon as practicable and in any event within ninety (90)] days after the end of each Fiscal Year commencing with the Fiscal Year ending December 31, 2003: (i) statements of income of Borrower for such Fiscal Year, and a balance sheet of Borrower as of the end of such Fiscal Year, and (ii) statements of cash flow of Borrower for such Fiscal Year, all setting forth in comparative form, corresponding figures for the period covered by the preceding annual audit and as of the end of the preceding Fiscal Year, such statements to be presented in accordance with Borrower’s normal method of accounting for Inventory and (if Borrower uses the LIFO method) on a pre-tax FIFO basis, all in reasonable detail and in accordance with GAAP and examined and reported on by independent certified public accountants of recognized national standing selected by Borrower and satisfactory to Agent, whose opinion shall be unqualified and shall be in accordance GAAP, in form and substance satisfactory to Agent.

(f) As soon as practicable and in any event not later than thirty (30) days prior to the beginning of each Fiscal Year commencing with the Fiscal Year commencing January 1, 2004, projected balance sheets, statements of income and cash flow for Borrower, for each of the twelve (12) months during such Fiscal Year, which shall include the assumptions used therein, together with appropriate supporting details as requested by Agent (hereinafter referred to as “Projections”).

(g) As soon as practicable and in any event within ten (10) days of delivery to Borrower, a copy of any letter issued by Borrower’s independent public accountants or other management consultants with respect to Borrower’s financial or accounting systems or controls, including all so-called “management letters”.

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(h) In conjunction with the delivery of the annual presentation of projections or budgets referred to in subparagraph (e) above, a letter signed by the chief financial officer of Borrower, describing, comparing and analyzing, in detail, all changes and developments between the anticipated financial results included in such projections or budgets and the historical financial statements of Borrower.

(i) As soon as practicable and in any event at the end of each Fiscal Year or as Agent may otherwise reasonably request, a complete and accurate update of the Customer Lists.

(j) With reasonable promptness, such other business or financial data, reports, appraisals and projections as Agent may reasonably request.

Without limiting any of Borrower’s obligations contained in this Section 11, Borrower shall, contemporaneously with delivery to Subordinated Lender, deliver to Lender, copies of all financial statements, financial information, reports, press releases, documents filed with the Securities and Exchange Commission, notices, correspondence, documents and all other information and items which Borrower is obligated to deliver or furnish to Subordinated Lender (provided, however, that such items may be in the same form delivered to the Subordinated Lender), whether pursuant to Article 8 of the Securities Purchase Agreement or otherwise.

All financial statements and other financial information delivered to Agent pursuant to the requirements of this paragraph 11 (except where otherwise expressly indicated) shall be prepared in accordance with GAAP as provided in this Agreement, on a consolidated and consolidating basis. Together with each delivery of financial statements required by subparagraphs (b) and (d) above, Borrower shall deliver to Agent an officer’s certificate in the form attached hereto as Exhibit D, which shall include a calculation of financial covenants in the schedule attached to such Officer’s Certificate in form satisfactory to Agent. Together with each delivery of annual financial statements required by subparagraph (d) above, Borrower shall deliver to Agent a certificate of the accountants who performed the audit in connection with such statements stating that in making the audit necessary to the issuance of a report on such financial statements, they have obtained no knowledge of any Event of Default, or, if such accountants have obtained knowledge of an Event of Default, specifying the nature and period of existence thereof and such certificates shall contain or have appended thereto calculations which set forth Borrower’s compliance with the financial covenants set forth herein.

(k) All schedules, certificates, reports and assignments and other items delivered by Borrower to Agent hereunder shall be executed by an authorized representative of Borrower and shall be in such form and contain such information as Agent shall reasonably request. Borrower shall deliver from time to time such other schedules and reports pertaining to the Collateral of Borrower as Agent may reasonably request.

12. TERM.

(a) This Agreement shall be in effect from the date hereof until July     , 2006 (the “Term”) unless the due date of the Liabilities is accelerated pursuant to paragraph 17 hereof, in which case this Agreement shall terminate on the date thereafter that the Liabilities are paid in

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full, provided, however, that the security interests and liens created under this Agreement and the Other Agreements shall survive such termination until the date upon which payment and satisfaction in full of the Liabilities shall have occurred. At such time as Borrower has repaid all of the Liabilities and this Agreement has terminated, Borrower shall deliver to Agent a release, in form and substance reasonably satisfactory to Agent, of all obligations and liabilities of Agent, Lenders and their officers, directors, employees, agents, parents, subsidiaries and affiliates to Borrower, and if Borrower is obtaining new financing from another lender, Borrower shall deliver such lender’s indemnification of Agent and each Lender, in form and substance reasonably satisfactory to Agent, for checks which Agent has credited to Borrower’s account, but which subsequently are dishonored for any reason.

(b) If: (i) Borrower prepays all or any portion of the Liabilities (which prepayment by Borrower must be upon forty-five (45) days’ prior written notice to Agent), (ii) Agent demands or Borrower is otherwise required to make payment in full of the Liabilities upon the occurrence of an Event of Default, (iii) a voluntary or involuntary Change of Control occurs, (iv) any other voluntary or involuntary prepayment of the Liabilities by Borrower or any other Person occurs (other than reductions to zero of the outstanding balance of the Revolving Loans resulting from the ordinary course operation of the provisions of paragraph 10 hereof), whether by virtue of Agent’s exercising its right of set-off or otherwise, (v) Agent accelerates the Note or makes any demand on the Note, (vi) any payment or reduction of the outstanding balance of the Note and/or the Loans is made during a bankruptcy, reorganization or other proceeding or is made pursuant to any plan of reorganization or liquidation or any similar law or (vii) the termination of this Agreement for any other reason whatsoever and the prepayment of some or all of the Liabilities (each, a “prepayment”), then, at the effective date of any such termination and/or prepayment, Borrower agrees to pay to Agent for its benefit and for the ratable benefit of Lenders, as a prepayment fee, in addition to the payment of all other Liabilities owing by Borrower to Agent and Lenders, an amount equal to: (x) three percent (3%) of the Revolving Loan Commitment if such prepayment is made during the first Contract Year; (y) two percent (2%) of the Revolving Loan Commitment if such prepayment is made during the second Contract Year; and (z) one-half of one percent (1/2%) of the Revolving Loan Commitment if such prepayment is made at any time during the third Contract Year prior to the expiration of the Term. In light of the extreme difficulty of accurately calculating actual damages arising out of any early termination and/or prepayment, Agent, Lenders and Borrower has agreed that the prepayment fee provided for above is a reasonable estimate of actual damages that would be incurred by Agent and Lenders.

13. REPRESENTATIONS AND WARRANTIES. Borrower hereby makes the following representations, warranties and covenants:

(a) Borrower has furnished to Agent: (1) balance sheets, income statements and cash flow projections of Borrower reflected quarterly for the period beginning January 1, 2003 and ending December 31, 2003 as set forth on Exhibit 13(a)(1) attached hereto and made a part hereof, (2) balance sheets, income statements and cash flow projections of Borrower reflected annually for the second and third Contract Years as set forth on Exhibit 13(a)(2) attached hereto and made a part hereof, and (3) an availability schedule for the period ending December 31, 2003 in the form attached hereto as Schedule 13(a)(3). The financial statements described in clauses (1), (2) and (3) of the first sentence of this paragraph were prepared by or

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under the direction of the Chief Financial Officer of Borrower and reflect, as of the Closing Date, the reasonable estimates of Borrower of the information projected therein, based on the assumptions accompanying such projections;

(b) the office where Borrower keeps its books, records and accounts (or copies thereof) concerning the Collateral, Borrower’s principal place of business and all of Borrower’s other places of business, locations of Collateral and post office boxes are as set forth in Exhibit A; Borrower shall promptly (but in no event less than thirty (30) days prior thereto) advise Agent in writing of the proposed opening of any new place of business, the closing of any existing place of business, any change in the location of Borrower’s principal place of business, Borrower’s books, records and accounts (or copies thereof) or the opening or closing of any post office box of Borrower;

(c) the Collateral, including without limitation the Equipment (except any part thereof which prior to the date of this Agreement Borrower shall have advised Agent in writing consists of Collateral normally used in more than one state) is and shall be kept, or, in the case of vehicles, based, only at the addresses set forth on the first page of this Agreement or on Exhibit A (such locations, “Collateral Locations”), and at other locations within the continental United States of which Agent has been advised by Borrower pursuant to twenty (20) days prior written notice (provided, however, that notwithstanding the foregoing, so long as there is then no continuing Event of Default or event which, with notice or lapse of time, or both, would become an Event of Default, Borrower may move Equipment among those Collateral Locations located in the continental United States);

(d) Borrower shall immediately give written notice to Agent of any use of any such Goods in any state or county other than a state or county in which Borrower has previously advised Agent in writing that such Goods shall be used (as of the Closing Date, such states or counties being set forth on Exhibit 13(d) hereto), and such Goods shall not, unless Agent shall otherwise consent in writing, be used outside of the continental United States (provided, however, that notwithstanding the foregoing, so long as there is then no continuing Event of Default or event which, with notice or lapse of time, or both, would become an Event of Default, Borrower may move Equipment among those Collateral Locations located in the continental United States);

(e) no security agreement, financing statement or analogous instrument exists or shall exist with respect to any of the Collateral other than any security agreement, financing statement or analogous instrument evidencing Permitted Liens;

(f) each Account or item of Inventory which Borrower shall, expressly or by implication, request Agent to classify as an Eligible Account or as Eligible Inventory, respectively, shall, as of the time when such request is made, conform in all respects to the requirements of such classification as set forth in the respective definitions of Eligible Account and Eligible Inventory and as otherwise established by Agent from time to time, and Borrower shall promptly notify Agent in writing if any such Eligible Account, Eligible Inventory or Eligible L/C Inventory shall subsequently become ineligible;

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(g) Borrower is and shall at all times during the Term be the lawful owner of all Collateral now purportedly owned or hereafter purportedly acquired by Borrower, free from all liens, claims, security interests and encumbrances whatsoever, whether voluntarily or involuntarily created and whether or not perfected including without limitation, any liens, security interests, trusts or encumbrances arising our of the Perishable Agricultural Commodities Act, the Packers and Stockyard Act, the Food Security Act of 1985 (the “Food Act”), or any law, regulation, rules, policies, guidelines, orders or directives relating to food or any food product, other than the Permitted Liens;

(h) Borrower has the right and power and is duly authorized and empowered to enter into, execute and deliver this Agreement and the Other Agreements and perform its obligations hereunder and thereunder; Borrower’s execution, delivery and performance of this Agreement and the Other Agreements does not and shall not conflict with the provisions of any statute, regulation, ordinance or rule of law, or any agreement, contract or other document which may now or hereafter be binding on Borrower, or Borrower’s Organizational Documents, and Borrower’s execution, delivery and performance of this Agreement and the Other Agreements shall not result in the imposition of any lien or other encumbrance upon any of Borrower’s property under any existing indenture, mortgage, deed of trust, loan or credit agreement or other agreement or instrument by which Borrower or any of its property may be bound or affected, other than in favor of Agent;

(i) there are no actions or proceedings which are pending or, to the best of Borrower’s knowledge, threatened against Borrower which are reasonably likely to have a Material Adverse Effect and Borrower shall, promptly upon becoming aware of any such pending or threatened action or proceeding, give written notice thereof to Agent;

(j) Borrower has obtained and shall maintain all consents, franchises, certificates, licenses, authorizations, approvals and permits, the lack of which would have a Material Adverse Effect, and Borrower is and shall remain in compliance in all material respects with all applicable federal, state, local and foreign statutes, orders, regulations, rules and ordinances (including, without limitation, statutes, orders, regulations, rules and ordinances relating to taxes, employer and employee contributions and similar items, securities, employee retirement and welfare benefits, employee health and safety or environmental matters), the failure to comply with which would be reasonably likely to have a Material Adverse Effect;

(k) all written information now, heretofore or hereafter furnished by Borrower to Agent is and shall be true and correct in all material respects as of the date with respect to which such information was or is furnished (except for financial projections, which have been prepared in good faith based upon reasonable assumptions);

(l) Borrower is not conducting, permitting or suffering to be conducted, nor shall it conduct, permit or suffer to be conducted, any activities pursuant to or in connection with which any of the Collateral is now, or will (while any Liabilities remain outstanding) be owned by any Affiliate;

(m) During the prior ten (10) years, Borrower’s name has always been as set forth on the first page of this Agreement and Borrower has used and presently uses no

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tradenames, assumed names, fictitious names or division names in the operation of its business, except as otherwise disclosed in writing to Agent; Borrower shall notify Agent in writing at least thirty (30) days prior to the change of its name or the use of any tradenames, assumed names, fictitious names or division names not previously disclosed to Agent in writing;

(n) with respect to Borrower’s Equipment: (i) Borrower has good and indefeasible and marketable title to and ownership of all of its Equipment; (ii) Borrower shall keep and maintain the Equipment in good operating condition and repair and shall make all necessary replacements thereof and renewals thereto so that the value and operating efficiency thereof shall at all times be preserved and maintained, ordinary wear and tear excepted; (iii) Borrower shall not permit any such items to become a fixture to real estate or an accession to other personal property; (iv) from time to time Borrower may sell, exchange or otherwise dispose of obsolete, unused or worn out Equipment, but only to the extent provided in paragraph 4(a) hereof; and (v) Borrower, immediately on demand by Agent, shall deliver to Agent any and all evidence of ownership of, including, without limitation, certificates of title and applications of title to, any of the Equipment;

(o) this Agreement and the Other Agreements to which Borrower is a party are the legal, valid and binding obligations of Borrower and are enforceable against Borrower in accordance with their respective terms, except to the extent that such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting the rights of creditors generally;

(p) Borrower is solvent, is able to pay its debts as they become due and has capital sufficient to carry on its business, now owns property having a value both at fair valuation and at present fair saleable value greater than the amount required to pay its debts, and will not be rendered insolvent by the execution and delivery of this Agreement or any of the Other Agreements or by completion of the transactions contemplated hereunder or thereunder;

(q) Borrower is not now obligated, whether directly or indirectly, for any loans or other Indebtedness for borrowed money other than: (i) the Liabilities; (ii) Indebtedness disclosed to Agent on Schedule 13(q); (iii) unsecured Indebtedness to trade creditors arising in the ordinary course of Borrower’s business; (iv) Indebtedness due to Subordinated Lender under the Subordinated Debt Documents as in effect on the Closing Date so long as such Indebtedness is subject to the terms of the Subordination Agreement, and (v) unsecured Indebtedness arising from the endorsement of drafts and other instruments for collection, in the ordinary course of Borrower’s business;

(r) Borrower does not own any margin securities, and none of the proceeds of the Loans hereunder shall be used for the purpose of purchasing or carrying any margin securities or for the purpose of reducing or retiring any Indebtedness which was originally incurred to purchase any margin securities or for any other purpose not permitted by Regulation U of the Board of Governors of the Federal Reserve System as in effect from time to time;

(s) except as otherwise disclosed on Schedule 13(s), Borrower has no Parents, Affiliates, Subsidiaries or divisions, nor is Borrower engaged in any joint venture or partnership with any other Person;

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(t) Borrower is duly organized, validly existing and in good standing in its state of organization and Borrower is duly qualified and in good standing in all states where the nature and extent of the business transacted by it or the ownership of its assets makes such qualification necessary, except for such other states in which the failure to so qualify would not have a Material Adverse Effect, and Borrower has delivered to Agent true and complete copies of its Organizational Documents as in effect on the Closing Date;

(u) Borrower is not in default under any material contract, lease or commitment to which it is a party or by which it is bound, nor does Borrower know of any dispute regarding any contract, lease or commitment which is material to the continued financial success and well-being of Borrower;

(v) there are no controversies pending or threatened between Borrower and any of its employees, other than employee grievances arising in the ordinary course of business which are not, in the aggregate, material to the continued financial success and well-being of Borrower, and Borrower is in compliance in all material respects with all federal and state laws respecting employment and employment terms, conditions and practices, except where the failure to so comply would not have a Material Adverse Effect;

(w) Borrower possesses, and shall continue to possess, adequate licenses, patents, patent applications, copyrights, service marks, trademarks, trademark applications, tradestyles and tradenames to continue to conduct its business as heretofore conducted by it; and Schedule 13(w) sets forth a complete list of all of Borrower’s licenses, registered patents, patent applications, registered copyrights, registered service marks, registered trademarks, trademark applications, tradestyles and tradenames;

(x) Borrower has delivered to Agent complete copies of the Subordinated Debt Documents (including all schedules, exhibits and disclosure letters referred to therein or delivered pursuant thereto, if any) and all amendments thereto, waivers relating thereto and other side letters or agreements affecting the terms thereof. None of such agreements and documents has been amended or supplemented, nor have any of the provisions thereof been waived, except pursuant to a written agreement or agreement which has heretofore been delivered to Agent;

(y) The proceeds of the Loans shall be used solely: (i) to pay Indebtedness of Borrower due to Bank of America N.A, and (ii) for Borrower’s general working capital purposes.

(z) Except as set forth on Schedule 13(z), no Benefit Plan was in violation in any material respect of any of the provisions of ERISA or any of the qualification requirements of Section 401(a) of the IRC within the immediately preceding five year period, no non-exempt Prohibited Transaction or Reportable Event has occurred with respect to any Benefit Plan, no Benefit Plan has been the subject of a waiver of the minimum funding standard under Section 412 of the IRC, no Benefit Plan has experienced an accumulated funding deficiency under Section 412 of the IRC, no Lien has been imposed upon the Borrower or any ERISA Affiliate of Borrower under Section 412(n) of the IRC, no Benefit Plan has been amended in such a way that the security requirements of Section 401(a)(29) of the IRC apply, no notice of intent to terminate a Benefit Plan has been distributed to affected parties or filed with the PBGC under Section 4041

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of ERISA, and no Benefit Plan has been terminated under Section 4041(e) of ERISA, the PBGC has not instituted proceedings to terminate, or appoint a trustee to administer, a Benefit Plan and no event has occurred or condition exists which might reasonably constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Benefit Plan, neither Borrower nor any ERISA Affiliate of Borrower would be liable for any amount in the aggregate pursuant to Sections 4062, 4063 or 4064 of ERISA if all Benefit Plans terminated as of the most recent valuation dates of such Benefit Plans which would reasonably result in a Material Adverse Effect; neither Borrower nor any ERISA Affiliate of Borrower maintains any employee welfare benefit plan, as defined in Section 3(1) of ERISA, which provides any benefits to an employee or the employee’s dependents with respect to claims incurred after the employee separates from service other than is required by applicable law; and neither Borrower nor any ERISA Affiliate of Borrower has incurred or expects to incur any withdrawal liability to any Multiemployer Plan and after the Closing Date, none of the above-described events shall occur which are reasonably likely to result in Material Adverse Effect;

(aa) The audited consolidated and consolidating balance sheets of Borrower and its Subsidiaries as at December 31, 2002, April 30, 2002 and April 30, 2001 and the audited consolidated and consolidating statements of income and of cash flows for the eight (8) month transition period ending on December 31, 2002, reported on by and accompanied by an unqualified report from Ernst & Young LLP, present fairly and accurately the consolidated and consolidating financial condition of Borrower and its Subsidiaries as at such date, and the consolidated and consolidating results of its operations and its consolidated and consolidating cash flows for the respective fiscal years then ended. All such financial statements, including the related schedules and notes thereto, have been prepared in accordance with GAAP applied consistently throughout the periods involved (except as approved by the aforementioned firm of accountants and disclosed therein). Borrower and its Subsidiaries do not have any material Contingent Obligations or liabilities for taxes that are not reflected in the most recent financial statements referred to in this paragraph. During the period from December 31, 2002 to and including the date hereof there has been no material Asset Disposition by Borrower or any of its Subsidiaries or Affiliates of any material part of its business or property.

(bb) Since December 31, 2002, there has been no development or event that has had or could reasonably be expected to result in a Material Adverse Effect, except that Borrower has been in default under its loan documents with Bank of America N.A. due to its failure to repay its obligations to Bank of America N.A. on July 15, 2003.

(cc) Borrower is, and after giving effect to the transactions contemplated hereby will be, Solvent.

(dd) No transfer of property is being made by Borrower and no obligation is being incurred by Borrower in connection with the transactions contemplated by this Agreement or the Other Agreements with the intent to hinder, delay, or defraud either present or future creditors of the Borrower.

(ee) (i) Except as set forth on Schedule 13(ee) attached hereto, Borrower has duly complied with, and its facilities, business, assets, property, leaseholds and Equipment are in compliance in all material respects with, the provisions of the Federal Occupational Safety

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and Health Act, the Environmental Protection Act, RCRA and all other Environmental Laws; there have been no outstanding citations, notices or orders of non-compliance issued to Borrower or relating to its business, assets, property, leaseholds or Equipment under any such laws, rules or regulations;

(ii) Borrower has been issued all required federal, state and local licenses, certificates or permits relating to all applicable Environmental Laws;

(iii) (A) There are no visible signs of releases, spills, discharges, leaks or disposal (collectively referred to as “Releases”) of Hazardous Substances at, upon, under or within any Real Property; (B) except as set forth on Schedule 13(ee) attached hereto, there are no underground storage tanks or polychlorinated biphenyls on the Real Property; (C) the Real Property has never been used by Borrower as a treatment, storage or disposal facility of Hazardous Waste; and (D) no Hazardous Substances are present on the Real Property or any premises leased by Borrower, excepting such quantities as are handled in accordance with all applicable manufacturer’s instructions and governmental regulations and in proper storage containers and as are necessary for the operation of the commercial business of Borrower or of its tenants;

(ff) Borrower is not involved in any labor dispute, there are no strikes or walkouts or union organization of Borrower’s employees threatened or in existence and no labor contract is scheduled to expire during the Term, in all cases, other than as set forth on Schedule 13(ff) attached hereto; and

(gg) Upon and after the Closing Date, Borrower does not propose to engage in any business other than the business in which it is presently engaged. On the Closing Date, Borrower will own and possess all of the rights and consents necessary for the conduct of the business of Borrower.

Borrower represents, warrants and covenants to Agent and each Lender that all representations, warranties and covenants of Borrower contained in this Agreement (whether appearing in paragraphs 13 or 14 hereof or elsewhere) shall be true at the time of Borrower’s execution of this Agreement, shall survive the execution, delivery and acceptance hereof by the parties hereto and the closing of the transactions described herein or related hereto, shall remain true until the repayment in full of all of the Liabilities and termination of this Agreement, and shall be remade by Borrower at the time each Revolving Loan is made and each Letter of Credit is issued pursuant to this Agreement.

14. COVENANTS. Until payment or satisfaction in full of all Liabilities and termination of this Agreement, unless Borrower obtains Agent’s prior written consent waiving or modifying any of Borrower’s covenants hereunder in any specific instance, Borrower agrees as follows:

(a) Borrower shall at all times keep accurate and complete books, records and accounts with respect to all of Borrower’s and its Subsidiaries and Affiliates business activities, in accordance with sound accounting practices and generally accepted accounting principles

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consistently applied, and shall keep such books, records and accounts, and any copies thereof, only at the addresses indicated for such purpose on Exhibit A.

(b) Agent, or any Persons designated by it, shall have the right, at any time, in the exercise of its commercially reasonable credit judgment, to call at Borrower’s and its Subsidiaries and Affiliates places of business at any reasonable times, and, without hindrance or delay, to inspect the Collateral and to inspect, audit, check and make extracts from Borrower’s and its Subsidiaries’ and Affiliates’ books, records, journals, orders, receipts and any correspondence and other data relating to Borrower’s and its Subsidiaries’ and Affiliates’ business, the Collateral or any transactions between the parties hereto, and shall have the right to make such verification concerning Borrower’s and its Subsidiaries’ and Affiliates’ business as Agent may consider reasonable under the circumstances. Borrower shall and shall cause its Subsidiaries and Affiliates to furnish to Agent such information relevant to Agent’s rights under this Agreement as Agent shall at any time and from time to time reasonably request. Borrower authorizes Agent to discuss the affairs, finances and business of Borrower with any officers or directors of Borrower or any Affiliate or Subsidiary of Borrower, or with those employees of any of the foregoing with whom Agent has determined in its commercially reasonable judgment to be necessary or desirable to converse, and to discuss the financial condition of Borrower and its Subsidiaries and Affiliates with Borrower’s independent public accountants. Any such discussions shall be without liability to Agent or to such accountants. Borrower shall pay to or reimburse Agent for all reasonable fees, costs, and out-of-pocket expenses incurred by Agent in the exercise of its rights hereunder (in addition to the fees payable by Borrower pursuant to paragraph 5 in connection with Agent’s examination of Borrower’s and its Subsidiaries’ and Affiliates’ books and records and Collateral) and all of such costs, fees and expenses shall constitute Revolving Loans hereunder, shall be payable on demand and, until paid, shall bear interest at the highest rate then applicable to Revolving Loans hereunder.

(c) (i) Borrower shall: keep the Collateral properly housed and shall keep the Collateral insured against such risks and in such amounts as are customarily insured against by Persons engaged in businesses similar to that of Borrower with such companies, in such amounts and under policies in such form as shall be reasonably satisfactory to Agent. Originals or certified copies of such policies of insurance have been or shall be delivered to Agent on the Closing Date, together with evidence of payment of all premiums therefor, and shall contain an endorsement, in form and substance acceptable to Agent, showing loss under such insurance policies payable to Agent. Such endorsement, or an independent instrument furnished to Agent, shall provide that the insurance company shall give Agent at least thirty (30) days prior written notice before any such policy of insurance is altered or cancelled and that no act, whether willful or negligent, or default of Borrower or any other Person shall affect the right of Agent to recover under such policy of insurance in case of loss or damage. Borrower hereby directs all insurers under such policies of insurance to pay all proceeds payable thereunder directly to Agent for its benefit and for the ratable benefit of Lenders as their respective interests may appear. Borrower irrevocably, makes, constitutes and appoints Agent (and all officers, employees or agents designated by Agent) as Borrower’s true and lawful attorney (and agent-in-fact) for the purpose of making, settling and adjusting claims under such policies of insurance, endorsing the name of Borrower on any check, draft, instrument or other item of payment for the proceeds of such policies of insurance and making all determinations and decisions with respect to such policies of

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insurance, provided, however, that Agent shall exercise such rights only upon the occurrence of an Event of Default.

(ii) Borrower shall maintain, at its expense, such public liability and third party property damage insurance as is customary for Persons engaged in businesses similar to that of Borrower with such companies and in such amounts, with such deductibles and under policies in such form as shall be reasonably satisfactory to Agent and originals or certified copies of such policies have been or shall be delivered to Agent on the Closing Date, together with evidence of payment of all premiums therefor; each such policy shall contain an endorsement showing Agent as additional insured thereunder and providing that the insurance company shall give Agent at least thirty (30) days prior written notice before any such policy shall be altered or cancelled; and

(iii) If Borrower at any time or times hereafter shall fail to obtain or maintain any of the policies of insurance required above or to pay any premium in whole or in part relating thereto, then Agent, without waiving or releasing any obligation or default by Borrower hereunder, may (but shall be under no obligation to) obtain and maintain such policies of insurance and pay such premiums and take such other actions with respect thereto as Agent deems advisable. All sums disbursed by Agent in connection with any such actions, including, without limitation, court costs, expenses, other charges relating thereto and reasonable attorneys’ fees, shall constitute Revolving Loans hereunder and, until paid, shall bear interest at the highest rate then applicable to Revolving Loans hereunder.

(d) Borrower shall not use the Collateral, or any part thereof, in any unlawful business or for any unlawful purpose or use or maintain any of the Collateral in any manner that does or could result in material damage to the environment or a violation of any applicable Environmental Laws; Borrower shall keep the Collateral in commercially reasonable condition, repair and order, ordinary wear and tear excepted; Borrower shall not permit the Collateral, or any part thereof, to be levied upon under execution, attachment, distraint or other legal process; Borrower shall not sell, lease, grant a security interest in or otherwise dispose of any of the Collateral except as expressly permitted by this Agreement or as contemplated by the Subordinated Debt Documents and covered and permitted by the Subordination Agreement; and Borrower shall not secrete or abandon any of the Collateral, or remove or permit removal of any of the Collateral from any of the locations listed on Exhibit A, except for the removal of Inventory sold in the ordinary course of Borrower’s business as permitted herein.

(e) All monies and other property obtained by Borrower from Agent pursuant to this Agreement will be used solely for the purposes set forth herein.

(f) Borrower shall, at the request of Agent, indicate on its records concerning the Collateral a notation, in form satisfactory to Agent, of the security interest of Agent hereunder, and Borrower shall not maintain duplicates or copies of such records at any address other than Borrower’s principal place of business set forth on the first page of this Agreement; provided, however, that Borrower, in the ordinary course of its business, may furnish copies of such records to its accountants, attorneys and other agents or advisors as it may determine to be necessary or desirable, in the exercise of its commercially reasonable judgment.

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(g) Borrower shall file all required tax returns and pay all of its taxes when due, including, without limitation, taxes imposed by federal, state or municipal agencies, and shall cause any liens for taxes to be promptly released; provided, however, that Borrower shall have the right to contest the payment of such taxes in good faith by appropriate proceedings so long as: (i) the amount so contested is shown on Borrower’s financial statements, (ii) the contesting of any such payment does not give rise to a lien for taxes, (iii) upon the occurrence of an Event of Default, Borrower keeps on deposit with Agent (such deposit to be held without interest) an amount of money which, in the sole judgment of Agent, is sufficient to pay such taxes and any interest or penalties that may accrue thereon, and (iv) if Borrower fails to prosecute such contest with reasonable diligence, Agent may apply the money so deposited in payment of such taxes. If Borrower fails to pay any such taxes and in the absence of any such contest by Borrower, Agent may (but shall be under no obligation to) advance and pay any sums required to pay any such taxes and/or to secure the release of any lien therefor, and any sums so advanced by Agent shall constitute Revolving Loans hereunder, shall be payable by Borrower to Agent on demand, and, until paid, shall bear interest at the highest rate then applicable to Revolving Loans hereunder.

(h) Borrower shall not: (i) incur, create, assume or suffer to exist any Indebtedness other than: (w) Indebtedness arising under this Agreement, (x) subordinated Indebtedness to the Subordinated Lender under the Subordinated Debt Documents to the extent covered and permitted by the Subordination Agreement, (y) subordinated Indebtedness to the Bridge Loan Lenders under the Bridge Loan Subordinated Debt Documents to the extent covered and permitted by the Bridge Loan Subordination Agreements, and (z) unsecured Indebtedness owing in the ordinary course of business to trade suppliers arising on or after the Closing Date; or (ii) assume, guarantee or endorse, or otherwise become liable in connection with, the obligations of any Person, except by endorsement of instruments for deposit or collection or similar transactions in the ordinary course of business. In the event that Grupo I.M.P.C.O. Mexicano intends to enter into a financing transaction with a lender or financing source, Borrower shall deliver to Lender true, correct and complete copies of all documents executed in connection therewith, not later than three (3) Business Days after consummation of such transaction.

(i) Borrower shall not enter into any merger or consolidation, or sell, lease or otherwise dispose of all or substantially all of its assets; Borrower shall not create or acquire any new Subsidiary (and Borrower shall not cause BRC to become a Subsidiary) or Affiliate or issue any shares of, or warrants or other rights to receive or purchase any shares of, any class of its stock or other equity; Borrower shall not enter into any transaction outside the ordinary course of Borrower’s business; provided, however, that Agent shall not unreasonably withhold its consent to Borrower’s entry into a joint venture or creation of a Subsidiary (other than BRC the creation as a Subsidiary is prohibited) in the ordinary course of its business, so long as: (A) prior to and after giving effect to any proposed transaction, there is then no Event of Default or event which, with notice or lapse of time, or both, would become an Event of Default, (B) Borrower provides Lender with not less than thirty (30) days prior written notice of any such proposed transaction and a copy of all material documents, and (C) Borrower’s contribution to the capitalization of assets of any proposed entity never exceeds $200,000 individually or $500,000 in the aggregate for all such transactions.

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(j) Borrower shall not: (i) declare or pay any dividend or other distribution (whether in cash or in kind) on, purchase, redeem or retire any shares of any class of its stock, or make any payment on account of, or set apart assets for the repurchase, redemption, defeasance or retirement of, any class of its stock equity or other interest; (ii) make any optional payment or prepayment on or redemption (including without limitation by making payments to a sinking fund or analogous fund or with respect to any “Excess Cash Flow provision” under the Subordinated Debt Documents) or repurchase of any Indebtedness for borrowed money other than Indebtedness pursuant to this Agreement (provided, however, that so long as there is no Event of Default or Default and there would be no Event of Default or Default after giving effect to any such proposed payment, Borrower may make the Excess Cash Flow Payments (as defined in the Securities Purchase Agreement) to the Subordinated Lender required to be paid under Section 11.2 of the Securities Purchase Agreement); (iii) make any payments whatsoever on the Indebtedness owing to the Subordinated Lender except as permitted under the Subordination Agreement; (iv) pay any management or similar fees to any Person or Persons in excess of $150,000, annually, in the aggregate for all such Persons; or (v) make any loan to any Person except travel advances to Borrower’s employees in the ordinary course of business consistent with past practices.

(k) Borrower shall not make any investment in any Person, whether in cash, securities or other property of any kind, other than direct obligations of the United States, other than as would be permitted pursuant to paragraph 14(i) above.

(l) Borrower shall not: (i) change its jurisdiction of organization, (ii) amend its Organizational Documents or any shareholder’s or similar agreement including, without limitation, amend its name, (iii) change its Fiscal Year, or (iv) amend any of the Subordinated Debt documents or request any waiver or consent with respect to any term or provisions thereof.

(m) Borrower shall not enter into or maintain any transaction or agreement with its Affiliates, except in the ordinary course of business in a manner and to an extent consistent with past practices of Borrower and necessary or desirable for the prudent operation of its business and upon fair and reasonable terms no less favorable to Borrower than would be obtained by Borrower in a comparable arms-length transaction with a Person who is not an Affiliate of Borrower.

(n) Borrower shall not enter into any amendment, waiver or modification of the Subordinated Debt Documents.

(o) Borrower shall not: (i) (x) maintain, or permit any member of the Controlled Group to maintain, or (y) become obligated to contribute, or permit any member of the Controlled Group to become obligated to contribute, to any Benefit Plan, other than those Benefit Plans disclosed on Schedule 13(z), (ii) engage, or permit any member of the Controlled Group to engage, in any non-exempt “prohibited transaction”, as that term is defined in Section 406 of ERISA and Section 4975 of the IRC, (iii) incur, or permit any member of the Controlled Group to incur, any “accumulated funding deficiency”, as that term is defined in Section 302 of ERISA or Section 412 of the IRC, (iv) terminate, or permit any member of the Controlled Group to terminate, any Benefit Plan could result in any material liability of Borrower or any member of the Controlled Group or the imposition of a lien on the property of Borrower or any member

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of the Controlled Group pursuant to Section 4068 of ERISA, (v) assume, or permit any member of the Controlled Group to assume, any obligation to contribute to any Multiemployer Plan not disclosed on Schedule 13(z), (vi) incur, or permit any member of the Controlled Group to incur, any withdrawal liability to any Multiemployer Plan; (vii) fail promptly to notify Agent of the occurrence of any Termination Event, (viii) fail to comply, in all material respects, or permit a member of the Controlled Group to fail to comply, in all material respects, with the requirements of ERISA or IRC or other applicable laws in respect of any Benefit Plan, (ix) fail to meet, or permit any member of the Controlled Group to fail to meet, all minimum funding requirements under ERISA or IRC or postpone or delay or allow any member of the Controlled Group to postpone or delay any funding requirement with respect of any Benefit Plan except as permitted by applicable laws, in each event (i) through (ix) which would be reasonably likely to result in a Material Adverse Effect.

(p) Borrower shall maintain and keep in full force and effect and cause to be maintained and kept in full force and effect, each of the financial covenants set forth below. The calculation and determination of each such financial covenant, and all accounting terms contained therein, shall be so calculated and construed in accordance with GAAP, on a consolidated basis for the Consolidated Group and applied on a basis consistent with the financial statements of Borrower with respect to itself and its Subsidiaries (including the Consolidated Group) delivered on or before the Closing Date to Agent:

(i) Consolidated Tangible Net Worth. Borrower shall maintain and cause the Consolidated Group to maintain, as of the end of each fiscal quarter, Consolidated Tangible Net Worth of not less than the respective amount set forth below opposite each such fiscal quarter:

Fiscal Quarter	Minimum Consolidated Tangible Net Worth
FQ3 2003	$	17,000,000
FQ4 2003		17,000,000
FQ1 2004		18,000,000
FQ2 2004		19,000,000
FQ3 2004		20,000,000
FQ4 2004		21,000,000
FQ1 2005		22,500,000
FQ2 2005		24,000,000
FQ3 2005		25,500,000
FQ4 2005		27,000,000
FQ1 2006		29,000,000
FQ2 2006		31,000,000
FQ3 2006		33,000,000

(ii) Minimum Consolidated EBITDA. Borrower shall maintain and cause the Consolidated Group to maintain, as of the end of each fiscal quarter of Borrower, Consolidated EBITDA, of not less than the amount set forth below opposite each such fiscal quarter, with respect to the period of four (4) consecutive fiscal quarters of the Consolidated

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Group ending on such fiscal quarter; provided, however, that for purposes of calculating the Consolidated EBITDA for the third fiscal quarter in 2003, the Consolidated EBITDA for the fourth fiscal quarter in 2002 shall be ($375,000):

Fiscal Quarter	Minimum Consolidated EBITDA
FQ3 2003	$	2,750,000
FQ4 2003		4,000,000
FQ1 2004		5,250,000
FQ2 2004		7,000,000
FQ3 2004		8,250,000
FQ4 2004		10,500,000
FQ1 2005		10,875,000
FQ2 2005		11,250,000
FQ3 2005		11,625,000
FQ4 2005		12,000,000
FQ1 2006		12,250,000
FQ2 2006		12,500,000
FQ3 2006		12,750,000

(iii) Fixed Charge Coverage Ratio. Borrower shall maintain and cause the Consolidated Group to maintain, as of the end of each fiscal quarter of Borrower, a Fixed Charge Coverage Ratio, of not less than the ratio set forth below opposite each such fiscal quarter, with respect to the period of four (4) consecutive fiscal quarters of the Consolidated Group ending on such fiscal quarter; provided, however, that for purposes of calculating the Fixed Charge Coverage Ratio for the third fiscal quarter in 2003, the Consolidated EBITDA for the fourth fiscal quarter in 2002 shall be ($375,000):

Fiscal Quarter	Fixed Charge Coverage Ratio
FQ4 2003	0.25 : 1.00
FQ1 2004	0.50 : 1.00
FQ2 2004	1.00 : 1.00
FQ3 2004	1.00 : 1.00
FQ4 2004	1.50 : 1.00
FQ1 2005	2.00 : 1.00
FQ2 2005	2.00 : 1.00
FQ3 2005	2.25 : 1.00
FQ4 2005	2.25 : 1.00
FQ1 2006	2.25 : 1.00
FQ2 2006	2.25 : 1.00
FQ3 2006	2.25 : 1.00

(iv) Consolidated Leverage Ratio. Borrower shall not permit or cause the Consolidated Leverage Ratio of Borrower at any time during or as of the end of a fiscal

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quarter of Borrower to exceed the ratio set forth below opposite such fiscal quarter with respect to the period of four (4) consecutive fiscal quarters of Borrower ending on such fiscal quarter:

Fiscal Quarter	Consolidated Leverage Ratio
FQ4 2003	8.45 : 1.00
FQ1 2004	6.95 : 1.00
FQ2 2004	4.95 : 1.00
FQ3 2004	3.95 : 1.00
FQ4 2004	3.45 : 1.00
FQ1 2005	3.20 : 1.00
FQ2 2005	3.20 : 1.00
FQ3 2005	2.95 : 1.00
FQ4 2005	2.95 : 1.00
FQ1 2006	2.70 : 1.00
FQ2 2006	2.70 : 1.00
FQ3 2006	2.70 : 1.00

(v) Maximum Outstanding Intercompany Accounts. Borrower shall not, directly or indirectly, extend credit to, or incur Indebtedness otherwise permitted hereunder for the benefit of any Subsidiary or Affiliate of Borrower or its Subsidiaries (including but not limited to, the incurrence of any Contingent Obligation), except for credit, Indebtedness or any Contingent Obligation not to exceed, in the aggregate, the amounts set forth below opposite each identified Subsidiary and Affiliate or group thereof set forth below:

Subsidiary	Permitted Credit
IMPCO Technologies Pty Ltd. IMPCO Technologies (SA) Pty. Ltd. IMPCO Technologies (NSW) Pty. Ltd. IMPCO Fuel Systems Pty Ltd.	$1,000,000
IMPCO Technologies Japan, KK	$500,000
Grupo I.M.P.C.O. Mexicano	$5,000,000
IMPCO Beru Technologies B.V. IMPCO-Beru Technologies, GmbH IMPCO-Beru Technologies S.A.R.L. IMPCO Technologies, Limited.	$2,000,000

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Subsidiary	Permitted Credit
Minda IMPCO Technologies, Limited Minda IMPCO Limited CNGC-IMPCO Technologies, LLC and all other Subsidiaries and Affiliates whether now or hereafter existing	$1,500,000

(q) Borrower (together with all of its Subsidiaries and Affiliates) shall not make Capital Expenditures of an aggregate amount of more than $2,250,000 in any period of four (4) consecutive fiscal quarters of Borrower (measured as at the end of each fiscal quarter of Borrower with respect to the period of four (4) consecutive fiscal quarters ending on such date).

(r) Borrower shall reimburse: (i) Agent for all costs and expenses including, without limitation, legal expenses and reasonable attorneys’ fees (both in-house and outside counsel), incurred by Agent in connection with the documentation and consummation of this transaction and any other transactions between Borrower and Agent, including, without limitation, UCC and other public record searches, lien filings, Federal Express or similar express or messenger delivery, appraisal costs, surveys, title insurance and environmental audit or review costs, and (ii) each of Agent and each Lender for all costs and expenses including, without, limitation, legal expenses and reasonable attorneys’ fees (both in-house and outside counsel), incurred by Agent and/or such Lender in seeking to collect, protect or enforce any rights in or to the Collateral or incurred by Agent in seeking to collect any Liabilities, restructure the Liabilities, workout the Liabilities (whether any such costs or expenses are incurred in connection with any bankruptcy filing) and to administer and enforce any of Agent’s and/or such Lenders rights under this Agreement (whether any such costs or expenses are incurred in connection with any bankruptcy filing). Borrowers shall also, jointly and severally, pay all normal service charges with respect to accounts maintained by Agent for the benefit of any Borrower. All such costs, expenses and charges shall constitute Revolving Loans hereunder, shall be payable by Borrowers to Agent on demand, and, until paid, shall bear interest at the highest rate then applicable to Revolving Loans hereunder.

(s) Borrower shall promptly notify Agent in writing of the occurrence of: (i) a Default or an Event of Default; (ii) any default under the Subordinated Debt Documents; (iii) any event which with the giving of notice or lapse of time, or both, would constitute an event of default under the Subordinated Debt Documents; (iv) any event, development or circumstance whereby any financial statements furnished to Agent fail in any material respect to present fairly, in accordance with GAAP consistently applied, the financial condition or operating results of Borrower as of the date of such statements or whereby any reports furnished to Agent fail in any material respect to present fairly the financial condition or operating results of Borrower as of the date of such reports; (v) any accumulated retirement plan funding deficiency which, if such deficiency continued for two plan years and was not corrected as provided in Section 4971 of IRC, could subject Borrower to a tax imposed by Section 4971 of IRC; (vi) each and every default by Borrower which might result in the acceleration of the maturity of any Indebtedness, including the names and addresses of the holders of such Indebtedness with respect to which there is a default existing or with respect to which the maturity has been or could be accelerated,

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and the amount of such Indebtedness; and (vii) any other development in the business or affairs of Borrower which could reasonably be expected to have a Material Adverse Effect; in each case describing the nature thereof and the action Borrower proposes to take with respect thereto.

(t) (i) Borrower shall ensure that the Real Property remains in compliance with all Environmental Laws and shall not place or permit to be placed any Hazardous Substances on any Real Property except as not prohibited by applicable law or appropriate governmental authorities.

(ii) Borrower shall establish and maintain a system to assure and monitor continued compliance with all applicable Environmental Laws which system shall include periodic reviews of such compliance.

(iii) Borrower shall: (i) employ in connection with the use of the Real Property appropriate technology necessary to maintain compliance with any applicable Environmental Laws and (ii) dispose of any and all Hazardous Waste generated at the Real Property only at facilities and with carriers that maintain valid permits under RCRA and any other applicable Environmental Laws. Borrower shall use its best efforts to obtain certificates of disposal, such as hazardous waste manifest receipts, from all treatment, transport, storage or disposal facilities or operators employed by Borrower in connection with the transport or disposal of any Hazardous Waste generated at the Real Property.

(iv) In the event Borrower obtains, gives or receives notice of any Release or threat of Release of a reportable quantity of any Hazardous Substances at the Real Property (any such event being hereinafter referred to as a “Hazardous Discharge”) or receives any notice of violation, request for information or notification that it is potentially responsible for investigation or cleanup of environmental conditions at the Real Property, demand letter or complaint, order, citation, or other written notice with regard to any Hazardous Discharge or violation of Environmental Laws affecting the Real Property or Borrower’s interest therein (any of the foregoing is referred to herein as an “Environmental Complaint”) from any Person, including any state agency responsible in whole or in part for environmental matters in the state in which the Real Property is located or the United States Environmental Protection Agency (any such person or entity hereinafter the “Authority”), then Borrower shall, within five (5) Business Days, give written notice of same to Agent detailing facts and circumstances of which Borrower is aware giving rise to the Hazardous Discharge or Environmental Complaint. Such information is to be provided to allow Agent to protect its security interest in the Real Property and is not intended to create nor shall it create any obligation upon Agent or any Lender with respect thereto.

(v) Borrower shall promptly forward to Agent copies of any request for information, notification of potential liability, demand letter relating to potential responsibility with respect to the investigation or cleanup of Hazardous Substances at any other site owned, operated or used by Borrower to dispose of Hazardous Substances and shall continue to forward copies of correspondence between Borrower and the Authority regarding such claims to Agent until the claim is settled. Borrower shall promptly forward to Agent copies of all documents and reports concerning a Hazardous Discharge at the Real Property that Borrower is

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required to file under any Environmental Laws. Such information is to be provided solely to allow Agent to protect Agent’s security interest in the Real Property and the Collateral.

(vi) Borrower shall respond promptly to any Hazardous Discharge or Environmental Complaint and take all necessary action in order to safeguard the health of any Person and to avoid subjecting the Collateral or Real Property to any lien. If Borrower shall fail to respond promptly to any Hazardous Discharge or Environmental Complaint or Borrower shall fail to comply with any of the requirements of any Environmental Laws, Agent on behalf of Lenders may, but without the obligation to do so, for the sole purpose of protecting Agent’s interest in Collateral: (A) give such notices or (B) enter onto the Real Property (or authorize third parties to enter onto the Real Property) and take such actions as Agent (or such third parties as directed by Agent) deem reasonably necessary or advisable, to clean up, remove, mitigate or otherwise deal with any such Hazardous Discharge or Environmental Complaint. All reasonable costs and expenses incurred by Agent and Lenders (or such third parties) in the exercise of any such rights, including any sums paid in connection with any judicial or administrative investigation or proceedings, fines and penalties, together with interest thereon from the date expended at the Default Rate for Prime Rate Revolving Loans shall be paid upon demand by Borrower, and until paid shall be added to and become a part of the Liabilities secured by the liens created by the terms of this Agreement or any other agreement between Agent, any Lender and Borrower.

(vii) Promptly upon the written request of Agent from time to time, Borrower shall provide Agent, at Borrower’s expense, with an environmental site assessment or environmental audit report prepared by an environmental engineering firm acceptable in the reasonable opinion of Agent, to assess with a reasonable degree of certainty the existence of a Hazardous Discharge and the potential costs in connection with abatement, cleanup and removal of any Hazardous Substances found on, under, at or within the Real Property. Any report or investigation of such Hazardous Discharge proposed and acceptable to an appropriate Authority that is charged to oversee the clean-up of such Hazardous Discharge shall be acceptable to Agent. If such estimates, individually or in the aggregate, exceed $100,000, Agent shall have the right to require Borrower to post a bond, letter of credit or other security reasonably satisfactory to Agent to secure payment of these costs and expenses.

(viii) Borrower shall defend and indemnify Agent and Lenders and hold Agent, Lenders and their respective employees, agents, directors and officers harmless from and against all loss, liability, damage and expense, claims, costs, fines and penalties, including attorney’s fees, suffered or incurred by Agent or Lenders under or on account of any Environmental Laws, including, without limitation, the assertion of any lien thereunder, with respect to any Hazardous Discharge, the presence of any Hazardous Substances affecting the Real Property, whether or not the same originates or emerges from the Real Property or any contiguous real estate, including any loss of value of the Real Property as a result of the foregoing except to the extent such loss, liability, damage and expense is attributable to any Hazardous Discharge resulting from actions on the part of Agent or any Lender. Borrower’s obligations under this paragraph 14(t)(viii) shall arise upon the discovery of the presence of any Hazardous Substances at the Real Property, whether or not any federal, state, or local environmental agency has taken or threatened any action in connection with the presence of any

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Hazardous Substances. Borrower’s obligation and the indemnifications hereunder shall survive the termination of this Agreement.

(ix) For purposes of paragraphs 13(bb) and 14(t), all references to Real Property shall be deemed to include all of Borrower’s right, title and interest in and to its owned and leased premises.

(u) Neither Borrower nor any Affiliate of Borrower shall use any portion of the proceeds of the Loans, either directly or indirectly, for the purpose of: (i) purchasing any securities underwritten or privately placed by ABN AMRO Securities (USA) Inc. (“AASI”), an affiliate of Agent, (ii) purchasing from AASI any securities in which AASI makes a market, or (iii) refinancing or making payments of principal, interest or dividends on any securities issued by Borrower or any Affiliate, and underwritten, privately placed or dealt in by AASI.

(v) Borrower’s common stock shall at all times be listed on the NASDAQ National Market.

(w) Borrower shall not exercise its right and option to purchase the Quota (as defined in the BRC Sale and Purchase Agreement) or other stock of BRC, pursuant to Paragraph 8 of the BRC Sale and Purchase Agreement, the Options Deed dated May 8, 2003 among certain BRC Shareholders and Borrower, or otherwise.

15. CONDITIONS PRECEDENT.

(a) The obligation of Agent and each Lender to fund the initial Revolving Loan on the Closing Date, and to co-sign as applicant for the initial Letter of Credit on the Closing Date, is subject to the satisfaction or waiver on or before the Closing Date of the following conditions precedent:

(i) Agent shall have received each of the agreements, opinions, reports, approvals, consents, certificates and other documents set forth on the closing document list attached hereto as Schedule A (the “Closing Document List”).

(ii) Since March 31, 2003, no event shall have occurred which has had or could reasonably be expected to have a Material Adverse Effect, as determined by Agent in its sole discretion.

(iii) Agent shall have received payment in full of all fees and expenses set forth herein payable to it by Borrower on or before the Closing Date.

(iv) Agent shall have determined that immediately after giving effect to: (A) the making of the initial Loans requested to be made on the Closing Date and (B) the issuance of the initial Letters of Credit, if any, requested to be made on the Closing Date and (C) the payment or reimbursement by Borrower of Agent for all closing costs and expenses incurred in connection with the transactions contemplated hereby, on a pro forma basis the Excess Availability of Borrower shall not be less than One Million Dollars ($1,000,000).

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(v) Agent shall have received a certificate from Borrower’s chief executive officer or chief financial officer, pursuant to which such officer shall certify that in calculating the Excess Availability described in clause (iv) above, the outstanding trade payables of Borrower were and are current and not past due in any material respect.

(vi) The Obligors shall have executed and delivered to Agent all documents which Agent determines are reasonably necessary to consummate the transactions contemplated hereby.

(vii) Agent shall have received duly executed agreements establishing the Lock Box and Blocked Accounts with financial institutions acceptable to Agent for the collection or servicing of the Accounts and proceeds of the Collateral.

(viii) Agent shall have completed Collateral examinations and received appraisals, the results of which shall be satisfactory in form and substance to the Agent, of the Accounts, Inventory, General Intangibles, Investment Property and Equipment of Borrower and all books and records in connection therewith.

(ix) Agent shall have received the audited financial statements of Borrower for the eight month transition period ended December 31, 2002 and the fiscal year ended April 30, 2002. Agent’s receipt of such financial statements shall be deemed to have occurred if the same are contained in Borrower’s Annual Reports on Form 10-K for the transition period ended December 31, 2002.

(x) There shall exist no default in any obligations or in compliance with any applicable legal requirement of Borrower (other than those disclosed to Agent in writing on or prior to the date hereof).

(xi) Agent shall be satisfied with its due diligence review of the business and financial affairs of Borrower and its management and its pre-closing audit of Borrower.

(xii) Agent shall have received the executed legal opinion of Davis Wright Tremaine LLP, in form and substance satisfactory to Agent which shall cover such matters incident to the transactions contemplated by this Agreement, the Notes, and related agreements as Agent may reasonably require (including, without limitation, enforceability and perfection issues with respect to the Collateral) and Borrower hereby authorizes and directs such counsel to deliver such opinions to Agent and Lenders.

(xiii) Agent shall have received landlord, processor or warehouseman agreements satisfactory to Agent with respect to all premises leased by Borrower or controlled by any of its processors, suppliers or customers at which books and records, Inventory and Equipment are located.

(xiv) Agent shall have received in form and substance satisfactory to Agent, certified copies of Borrower’s casualty insurance policies, together with loss payable endorsements on Agent’s standard form of loss payee endorsement naming Agent as lender loss

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payee, and certified copies of Borrower’s liability insurance policies, together with endorsements naming Agent as a co-insured.

(xv) Each document (including, without limitation, any Uniform Commercial Code financing statement and filings with the United State Patent and Trademark Office or any similar state authority) required by this Agreement, any Other Agreement or under law or reasonably requested by the Agent to be filed, registered or recorded in order to create, in favor of Agent, a perfected security interest in or lien upon the Collateral shall have been properly filed, registered or recorded in each jurisdiction in which the filing, registration or recordation thereof is so required or requested, and Agent shall have received an acknowledgment copy, or other evidence satisfactory to it, of each such filing, registration or recordation and satisfactory evidence of the payment of any necessary fee, tax or expense relating thereto.

(xvi) (A) No litigation, investigation or proceeding before or by any arbitrator or governmental body shall be continuing or threatened against Borrower or against the officers or directors of Borrower: (I) in connection with this Agreement or the Other Agreements or any of the Transactions and which, in the reasonable opinion of Agent, is deemed material or (II) which if adversely determined, could, in the reasonable opinion of Agent, have a Material Adverse Effect on Borrower; and (Bi) no injunction, writ, restraining order or other order of any nature materially adverse to Borrower or the conduct of its business or inconsistent with the due consummation of the transactions contemplated by this Agreement or the Other Agreements shall have been issued by any governmental body.

(xvii) Agent shall have received all environmental studies and reports prepared by independent environmental engineering firms regarding the Real Property, the results of which shall be satisfactory to Agent in all respects.

(xviii) Agent shall have reviewed all material contracts of Borrower including, without limitation, leases, union contracts, labor contracts, vendor supply contracts, license agreements and distributorship agreements and such contracts and agreements shall be satisfactory in all respects to Agent.

(xix) Borrower shall be in compliance with all applicable laws and regulations.

(xx) No Default or Event of Default shall exist.

(xxi) All corporate and other proceedings, and all documents, instruments and other legal matters in connection with the transactions contemplated by this Agreement shall be satisfactory in form and substance to Agent, Lenders and their counsel.

(xxii) Agent shall have received and reviewed the Pro Forma Balance Sheet and monthly projections of the Borrower through December 31, 2003, , together with financial projections for the second and third Contract Year, calculated on an annual basis, and such balance sheet and projections shall be in form and substance satisfactory to the Agent.

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(xxiii) The Subordinated Lender shall have invested, in cash, not less than $17,250,000 in Borrower, in the form of a capital contribution (if a capital contribution is made, the capital structure of Borrower must be satisfactory to Lender) and/or a subordinated loan covered by and subordinated pursuant to the Subordination Agreement; Agent shall have received copies of the executed Subordinated Debt Documents, each of which shall be in form and substance satisfactory to Agent; Agent shall have entered into the Subordination Agreement with the Subordinated Lender; and Agent shall have received satisfactory evidence that Borrower received the cash proceeds under the Subordinated Debt Documents and/or equity contribution.

(xxiv) Agent shall have received approval from its credit committee for all of the Transactions.

(xxv) Lender shall have received evidence satisfactory to Lender that the entire $7,000,000 Deferred Portion of the Purchase Price (as such term is defined in the BRC Sale and Purchase Agreement) due the BRC Shareholders relating to the BRC Transaction with respect to Borrower’s acquisition of BRC under the BRC Agreements has been paid by wire transfer of immediately available funds to an account designated by the BRC Shareholders.

(xxvi) Borrower shall have furnished to Lender copies of Borrower’s agreements with UPS Oasis Supply and the terms thereof shall be satisfactory to Lender and its counsel.

(xxvii) Agent shall have received evidence satisfactory to Agent that certain Indebtedness of Borrower to certain lenders relating to payments made to the BRC Shareholders has been paid in full, and Olywood LLC and Jon Adams (collectively, the “Bridge Loan Lenders”) shall have delivered to the Agent, copies of all promissory notes, warrant agreements and other agreements evidencing or relating to the indebtedness and obligations of Borrower to the Bridge Loan Lenders (the “Bridge Loan Subordinated Debt Documents”), and each of the Bridge Loan Lenders and the Subordinated Lender hall have executed and delivered to and with Agent, subordination agreements in form and substance satisfactory to Agent (collectively, the “Bridge Loan Subordination Agreements”), pursuant to which the due payment and performance of all indebtedness, liabilities and obligations of Borrower to the Bridge Loan Lenders shall be subordinated to the payment and satisfaction in full of all of the Liabilities.

(b) The obligation of Agent or any Lender to make any requested Loan, or to issue or cause the issuance of any requested Letter of Credit, whether on or at any time after the Closing Date, is subject to the satisfaction of the conditions precedent set forth below. Each such request shall constitute a representation and warranty that such conditions are satisfied:

(i) All representations and warranties contained in this Agreement and the Other Agreements shall be true and correct on and as of the date of such request, as if then made, other than representations and warranties that relate solely to an earlier date.

(ii) No Default or Event of Default shall have occurred, or would result from the making of the requested Loan or the issuance of the requested Letter of Credit, which has not been waived in writing by Agent.

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(iii) Since December 31, 2002, no event has occurred which has had or could reasonably be expected to have a Material Adverse Effect.

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

(a) the failure of any Obligor to pay when due, declared due, or demanded by Agent in accordance with the terms hereof, any of the Liabilities;

(b) the failure of any Obligor to perform, keep or observe any of the covenants, conditions, promises, agreements or obligations of such Obligor under this Agreement or any of the Other Agreements;

(c) (i) the making or furnishing by any Obligor to Agent or any Lender of any representation, warranty, certificate, schedule, report or other communication within or in connection with this Agreement or the Other Agreements or in connection with any other agreement between such Obligor and Agent or such Lender, which is untrue or misleading in any material respect, or (ii) the failure of any Obligor to perform, keep or observe any of the covenants, conditions, promises, agreements of such Obligor under any other agreement with any Person if such failure has or is reasonably likely to have a Material Adverse Effect;

(d) the creation (whether voluntary or involuntary) of, or any attempt to create, any lien or other encumbrance upon any of the Collateral, other than the Permitted Liens, or the making or any attempt to make any levy, seizure or attachment thereof, or any material portion of Borrower’s or any of its Subsidiaries’ assets is attached, seized, subjected to a writ or distress warrant, or by any reason of an act or omission to act by Borrower comes into the possession of any third Person;

(e) the commencement of any proceedings: (i) in bankruptcy by or against any Obligor, (ii) for the liquidation or reorganization of any Obligor, (iii) alleging that such Obligor is insolvent or unable to pay its debts as they mature, or (iv) for the readjustment or arrangement of any Obligor’s debts, whether under the United States Bankruptcy Code or under any other law, whether state or federal, now or hereafter existing for the relief of debtors, or the commencement of any analogous statutory or non-statutory proceedings involving any Obligor; provided, however, that if such commencement of proceedings against such Obligor is involuntary and Borrower has not consented to an order for relief in connection therewith, such action shall not constitute an Event of Default unless such proceedings are not dismissed within ninety (90) days after the commencement of such proceedings;

(f) the appointment of a receiver or trustee for any Obligor, for any of the Collateral or for any substantial part of any Obligor’s assets or the institution of any proceedings for the dissolution, or the full or partial liquidation, or the merger or consolidation, of any Obligor; provided, however, that if such appointment or commencement of proceedings against such Obligor is involuntary, such action shall not constitute an Event of Default unless such appointment is not revoked or such proceedings are not dismissed within thirty (30) days after the commencement of such proceedings;

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(g) the entry of any judgment or order in excess of $50,000 against any Obligor which remains unsatisfied or undischarged and in effect for thirty (30) days after such entry without a stay of enforcement or execution;

(h) the occurrence of a default or event of default under, or the revocation or termination of, any agreement, instrument or document executed and delivered by any Person to Agent pursuant to which such Person has guaranteed to Agent for its benefit and for the ratable benefit of Lenders the payment of all or any of the Liabilities or has granted Agent for its benefit and for the ratable benefit of Lenders a security interest in or lien upon some or all of such Person’s real and/or personal property to secure the payment of all or any of the Liabilities;

(i) the occurrence of a default or event of default under any other agreement or instrument evidencing Indebtedness for borrowed money in excess of $50,000 executed or delivered by Borrower or pursuant to which agreement or instrument Borrower or its properties is or may be bound, including, without limitation, the Subordinated Debt Documents;

(j) the occurrence of any event or condition which has or is reasonably likely to have a Material Adverse Effect;

(k) the occurrence of a Change of Control;

(l) if any Reportable Event shall have occurred or any Benefit Plan shall be terminated within the meaning of Title IV of ERISA, or a trustee shall be appointed by the appropriate United States District Court to administer any Benefit Plan, the PBGC shall institute proceedings to terminate any Benefit Plan, or there shall be a withdrawal from any Multiemployer Plan, and there shall be a Material Adverse Effect in the case of any event described in this paragraph 16(l);

(m) the occurrence of any event specified in Borrower’s Organizational Documents that may result in Borrower’s dissolution or liquidation or Borrower shall file a certificate of dissolution or shall be liquidated, dissolved or wound-up or shall commence or have commenced against it any action or proceeding for dissolution, winding up or liquidation; or

(n) the operations of Borrower’s manufacturing facility are interrupted at any time for more than five (5) consecutive Business Days, unless Borrower shall: (i) be entitled to receive for such period of interruption, proceeds of business interruption insurance sufficient to assure that its per diem cash needs during such period is at least equal to its average per diem cash needs for the consecutive three month period immediately preceding the initial date of interruption and (ii) receive such proceeds in the amount described in clause (i) preceding not later than thirty (30) days following the initial date of any such interruption; provided, however, that notwithstanding the provisions of clauses (i) and (ii) of this paragraph 16(n), an Event of Default shall be deemed to have occurred if Borrower shall be receiving the proceeds of business interruption insurance for a period of thirty (30) consecutive days;

(o) any amount is paid pursuant to Section 11.3 of the Securities Purchase Agreement;

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(p) Borrower or any of its Subsidiaries makes any payment on account of Indebtedness that has been contractually subordinated in right of payment to the payment of the Liabilities, except for payments permitted to be made under the Subordination Agreement (other than amounts paid pursuant to Section 11.3 of the Securities Purchase Agreement the payment of which is an Event of Default under subsection 16(o) above);

(q) this Agreement or any of the Other Agreements that purports to create a Lien, shall, for any reason, fail or cease to create a valid and perfected first priority Lien on and security interest in any or all of the Collateral covered hereby or thereby;

(r) there is a default by Borrower or any of its Subsidiaries under any material agreement to which it is a party; or

(s) any provision of this Agreement or any of the Other Agreements shall at any time for any reason be declared to be null and void, or the validity or enforceability thereof shall be contested by Borrower, or a proceeding is commenced by Borrower or by any governmental authority having jurisdiction over Borrower, seeking to establish the invalidity or unenforceability thereof, or Borrower shall deny that Borrower has liability or obligation purported to be created under this Agreement or the Other Agreements.

Notwithstanding anything contained in this paragraph 16 or contained in any other provision of this Agreement or the Other Agreements to the contrary, in the event of the institution of any proceeding or appointment described in paragraph 16(e) or paragraph 16(f) hereof against Borrower, Agent and Lenders shall not be obligated to make advances to Borrower during the thirty (30) day grace period provided in paragraph 16(e) or paragraph 16(f).

17. REMEDIES UPON AN EVENT OF DEFAULT.

(a) Upon the occurrence of an Event of Default described in paragraph 16(e) or paragraph 16 (f) hereof, all of the Liabilities shall immediately and automatically become due and payable, without notice of any kind. Upon the occurrence of any other Event of Default, all of the Liabilities may, at the option of Agent at the direction of Required Lenders, and without demand, notice or legal process of any kind, be declared, and immediately shall become, due and payable.

(b) Upon the occurrence of an Event of Default, Agent may exercise from time to time any rights and remedies available to it under the UCC and under any other applicable law in addition to, and not in lieu of, any rights and remedies expressly granted in this Agreement or in any of the Other Agreements and all of Agent’s rights and remedies shall be cumulative and non-exclusive to the extent permitted by law. In particular, but not by way of limitation of the foregoing, Agent may, without notice, demand or legal process of any kind, take possession of any or all of the Collateral (in addition to Collateral of which it already has possession), wherever it may be found, and for that purpose may pursue the same wherever it may be found, and may enter into any of Borrower’s premises where any of the Collateral may be, and search for, take possession of, remove, keep and store any of the Collateral until the same shall be sold or otherwise disposed of, and Agent shall have the right to store the same at any of Borrower’s premises without cost to Agent. At Agent’s request, Borrower shall, at Borrower’s

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expense, assemble the Collateral and make it available to Agent at one or more places to be designated by Agent and reasonably convenient to Agent and Borrower. Borrower recognizes that if Borrower fails to perform, observe or discharge any of its Liabilities under this Agreement or the Other Agreements, no remedy at law will provide adequate relief to Agent or Lenders, and Borrower agrees that Agent and Lenders shall be entitled to temporary and permanent injunctive relief in any such case without the necessity of proving actual damages. Any notification of intended disposition of any of the Collateral required by law will be deemed reasonably and properly given if given at least ten (10) calendar days before such disposition. Any proceeds of any disposition by Agent of any of the Collateral may be applied by Agent to the payment of expenses in connection with the Collateral including, without limitation, legal expenses and reasonable attorneys’ fees (both in-house and outside counsel) and any balance of such proceeds may be applied by Agent toward the payment of such of the Liabilities, and in such order of application, as Agent may from time to time elect. No delay or omission of the Agent or any Lender to exercise any right or remedy hereunder shall impair any such right or operate as a waiver thereof. No single or partial exercise by the Agent or any Lender of any right or remedy shall preclude any other or further exercise thereof, or preclude any other right or remedy.

(c) The Agent shall have no obligation to marshal any Collateral or to seek recourse against or satisfaction of any of the Liabilities from one source before seeking recourse against or satisfaction from another source. The net cash proceeds resulting from the Agent’s exercise of any of the foregoing rights to liquidate all or substantially all of the Collateral, including any and all collections (after deducting all of the Agent’s and Lender’s expenses related thereto), shall be applied by the Agent to such of the Liabilities and in such order as the Agent shall elect in its sole and absolute discretion, whether due or to become due. Borrower shall remain liable to the Agent and the Lenders for any deficiencies. All of the Agent’s and the Lenders’ remedies under the Other Agreements shall be cumulative, may be exercised simultaneously against any Collateral and any Obligor or in such order and with respect to such Collateral or such Obligor as the Agent may deem desirable, and are not intended to be exhaustive.

(d) To the extent permitted by law and not otherwise prohibited by contracts with third parties, each Borrower hereby grants to the Agent, for use by the Lenders and the Agent solely in connection with the preservation or sale of any Collateral, a license or other right to use, without charge by any Obligor or Subsidiary thereof, all computer software, copyrights, labels, trade secrets, service marks, patents, advertising materials and other rights, assets and materials used by Borrower and needed in connection with the preservation or sale of such Collateral.

18. INDEMNIFICATION. Borrower agrees to defend (with counsel reasonably satisfactory to Agent), protect, indemnify and hold harmless Agent and each Lender, each affiliate or subsidiary of Agent or such Lender, and each of their respective officers, directors, employees, attorneys and agents (each an “Indemnified Party”) from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, claims, costs, expenses and disbursements of any kind or nature (including, without limitation, the disbursements and the reasonable fees of counsel for each Indemnified Party in connection with any investigative, administrative or judicial proceeding, whether or not the Indemnified Party shall be designated a party thereto and any fees associated with a broker or similar Person),

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which may be imposed on, incurred by, or asserted against, any Indemnified Party (whether direct, indirect or consequential and whether based on any federal, state or local laws or regulations including, without limitation, securities, Environmental Laws and commercial laws and regulations, under common law or in equity, or based on contract or otherwise) in any manner relating to or arising out of this Agreement or any Other Agreement, or any act, event or transaction related or attendant thereto, the making and the management of the Loans or any Letters of Credit or the use or intended use of the proceeds of the Loans or any Letters of Credit; provided, however, that Borrower shall not have any obligation hereunder to any Indemnified Party with respect to matters caused by or resulting from the willful misconduct or gross negligence of such Indemnified Party. To the extent that the undertaking to indemnify set forth in the preceding sentence may be unenforceable because it is violative of any law or public policy, Borrower shall satisfy such undertaking to the maximum extent permitted by applicable law. Any liability, obligation, loss, damage, penalty, cost or expense covered by this indemnity shall be paid to each Indemnified Party on demand, and, failing prompt payment, shall, together with interest thereon at the highest rate then applicable to Revolving Loans hereunder from the date incurred by each Indemnified Party until paid by Borrower, be added to the Liabilities of Borrower and be secured by the Collateral. The provisions of this paragraph 18 shall survive the satisfaction and payment of the other Liabilities and the termination of this Agreement.

19. REGARDING AGENT.

(a) Appointment. Each Lender hereby designates LaSalle to act as Agent for such Lender under this Agreement and the Other Agreements. Each Lender hereby irrevocably authorizes Agent to take such action on its behalf under the provisions of this Agreement and the Other Agreements and to exercise such powers and to perform such duties hereunder and thereunder as are specifically delegated to or required of Agent by the terms hereof and thereof and such other powers as are reasonably incidental thereto and Agent shall hold all Collateral, payments of principal and interest, fees (except the fees set forth in subparagraphs 5(d), 5(e), 5(g) and 5(h)), charges and collections (without giving effect to any collection days) received pursuant to this Agreement, for the ratable benefit of Lenders. Agent may perform any of its duties hereunder by or through its agents or employees. As to any matters not expressly provided for by this Agreement, Agent shall not be required to exercise any discretion or take any action, but shall be required to act or to refrain from acting (and shall be fully protected in so acting or refraining from acting) upon the instructions of the Required Lenders, and such instructions shall be binding; provided, however, that Agent shall not be required to take any action which exposes Agent to liability or which is contrary to this Agreement or the Other Agreements or applicable law unless Agent is furnished with an indemnification reasonably satisfactory to Agent with respect thereto.

(b) Nature of Duties. Agent shall have no duties or responsibilities except those expressly set forth in this Agreement and the Other Agreements. Neither Agent nor any of its officers, directors, employees or agents shall be: (i) liable for any action taken or omitted by them as such hereunder or in connection herewith, unless caused by their gross (not mere) negligence or willful misconduct, or (ii) responsible in any manner for any recitals, statements, representations or warranties made by Borrower or any officer thereof contained in this Agreement, or in any Other Agreement or in any certificate, report, statement or other document referred to or provided for in, or received by Agent under or in connection with, this Agreement

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or any Other Agreement or for the value, validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement, or any Other Agreement or for any failure of Borrower to perform its obligations hereunder. Agent shall not be under any obligation to any Lender to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, this Agreement or any Other Agreement, or to inspect the properties, books or records of Borrower. The duties of Agent as respects the Loans to Borrower shall be mechanical and administrative in nature; Agent shall not have by reason of this Agreement a fiduciary relationship in respect of any Lender; and nothing in this Agreement, expressed or implied, is intended to or shall be so construed as to impose upon Agent any obligations in respect of this Agreement except as expressly set forth herein.

(c) Lack of Reliance on Agent and Resignation.

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

(ii) Agent may resign on sixty (60) days’ written notice to each of Lenders and Borrower and upon such resignation, the Required Lenders will promptly designate a successor Agent reasonably satisfactory to Borrower.

(iii) Any such successor Agent shall succeed to the rights, powers and duties of Agent, and the term “Agent” shall mean such successor agent effective upon its appointment, and the former Agent’s rights, powers and duties as Agent shall be terminated, without any other or further act or deed on the part of such former Agent. After any Agent’s resignation as Agent, the provisions of this paragraph 19, shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Agent under this Agreement.

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

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Lenders shall not have any right of action whatsoever against Agent as a result of its acting or refraining from acting hereunder in accordance with the instructions of the Required Lenders.

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

(f) Notice of Default. Agent shall not be deemed to have knowledge or notice of the occurrence of any Default or Event of Default hereunder or under the Other Agreements, unless Agent has received notice from a Lender or Borrower referring to this Agreement or the Other Agreements, describing such Default or Event of Default and stating that such notice is a “notice of default”. In the event that Agent receives such a notice, Agent shall give notice thereof to Lenders. Agent shall take such action with respect to such Default or Event of Default as shall be reasonably directed by the Required Lenders; provided, that, unless and until Agent shall have received such directions, Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of Default as it shall deem advisable in the best interests of Lenders.

(g) Indemnification. To the extent Agent is not reimbursed and indemnified by Borrower, each Lender will reimburse and indemnify Agent in proportion to its respective portion of the Loans (or, if no Loans are outstanding, according to its Commitment Percentage), from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever which may be imposed on, incurred by or asserted against Agent in performing its duties hereunder, or in any way relating to or arising out of this Agreement or any Other Agreement; provided that, Lenders shall not be liable for any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting from Agent’s gross (not mere) negligence or willful misconduct.

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

(i) Delivery of Documents. To the extent Agent receives documents and written information from Borrower pursuant to paragraphs 11(c), (d), (e), (f) or (g) of this Agreement, Agent will promptly furnish such documents and information to Lenders.

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

20. NOTICES. All written notices and other written communications with respect to this Agreement shall be sent by ordinary, certified or overnight mail, by telecopy or delivered by reputable courier or in person to: LaSalle Business Credit, LLC, 565 Fifth Avenue, New York, New York 10017, Attention: District Credit Manager,

with a copy to:

Jenkens & Gilchrist Parker Chapin LLP

405 Lexington Avenue

New York, New York 10174

Attention: Michael A. Leichtling, Esq.

Telephone: (212) 704-6257

Facsimile: (212) 704-6288

and

LaSalle Business Credit, LLC

135 South LaSalle Street

Suite 425

Chicago, Illinois 60603-4105

Attention: Michael Carsella, Esq.

Telephone: (312) 904-7805

Facsimile: (312) 904-7425

and in the case of Borrower shall be sent to Borrower at its principal place of business as set forth on the first page of this Agreement, and in the case of any Lender shall be sent to such Lender at its address set forth on the signature page hereto or in a Commitment Transfer Supplement or at such other address as may be designated by any party from time to time in a notice complying as to delivery with the terms of this paragraph to the other parties. Any notice, if mailed or delivered via reputable courier or by hand delivery and properly addressed with postage or delivery costs prepaid, shall be deemed given when received; any notice, if transmitted by telecopy, shall be deemed given when transmitted, provided receipt is confirmed.

21. CHOICE OF GOVERNING LAW AND CONSTRUCTION. This Agreement and the Other Agreements are submitted by Borrower to Agent for Agent’s acceptance or rejection at Agent’s place of business located in New York, New York, as an offer by Borrower to borrow monies from Agent and Lenders now and from time to time hereafter, and shall not be binding upon Agent or any Lender or become effective until accepted by Agent on behalf of Lenders, in writing, at said place of business. If so accepted by Agent on behalf of Lenders, this

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Agreement and the Other Agreements shall be deemed to have been made at said place of business. THIS AGREEMENT AND THE OTHER AGREEMENTS SHALL BE GOVERNED AND CONTROLLED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK AS TO INTERPRETATION, ENFORCEMENT, VALIDITY, CONSTRUCTION, EFFECT, AND IN ALL OTHER RESPECTS, INCLUDING, WITHOUT LIMITATION, THE LEGALITY OF THE INTEREST RATE AND OTHER CHARGES, BUT EXCLUDING PERFECTION OF THE SECURITY INTERESTS IN THE COLLATERAL, WHICH SHALL BE GOVERNED AND CONTROLLED BY THE LAWS OF THE RELEVANT JURISDICTION. If any provision of this Agreement shall be held to be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or remaining provisions of this Agreement.

22. FORUM SELECTION AND SERVICE OF PROCESS. To induce Agent on behalf of Lenders to accept this Agreement, Borrower irrevocably agrees that, subject to Agent’s sole and absolute election, ALL ACTIONS OR PROCEEDINGS IN ANY WAY, MANNER OR RESPECT, ARISING OUT OF OR FROM OR RELATED TO THIS AGREEMENT, THE OTHER AGREEMENTS OR THE COLLATERAL SHALL BE LITIGATED IN COURTS HAVING SITUS WITHIN THE CITY OF NEW YORK, STATE OF NEW YORK. BORROWER HEREBY CONSENTS AND SUBMITS TO THE JURISDICTION OF ANY LOCAL, STATE OR FEDERAL COURTS LOCATED WITHIN SAID CITY AND STATE. Borrower further irrevocably consents to the service of any complaint, summons, notice or other process relating to any such action or proceeding by delivery thereof to it by hand or by mail in the manner provided for in paragraph 20 hereof. Borrower hereby expressly and irrevocably waives any claim or defense in any such action or proceeding based on any alleged lack of personal jurisdiction, improper venue or forum non conveniens or any similar basis. Borrower shall not be entitled in any such action or proceeding to assert any defense given or allowed under the laws of any state other than the State of New York unless such defense is also given or allowed by the laws of the State of New York. BORROWER HEREBY WAIVES ANY RIGHT IT MAY HAVE TO TRANSFER OR CHANGE THE VENUE OF ANY LITIGATION BROUGHT AGAINST BORROWER BY AGENT OR ANY LENDER IN ACCORDANCE WITH THIS PARAGRAPH. Nothing in this paragraph 22 shall affect or impair in any manner or to any extent the right of Lender to comprise legal proceedings or otherwise proceed against Borrower in any jurisdiction or to serve process in any manner provided by law.

23. MODIFICATION AND BENEFIT OF AGREEMENT.

(a) This Agreement and the Other Agreements may not be modified, altered or amended except by an agreement in writing signed by Borrower, Agent and Required Lenders as provided in subparagraph (b) below. Borrower may not sell, assign or transfer this Agreement, or the Other Agreements or any portion thereof including, without limitation, Borrower’s rights, titles, interest, remedies, powers or duties thereunder.

(b) The Required Lenders, Agent with the consent in writing of the Required Lenders, and Borrower may, subject to the provisions of this paragraph 23(b), from time to time enter into written supplemental agreements to this Agreement, the Notes or the Other

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Agreements executed by Borrower, for the purpose of adding or deleting any provisions or otherwise changing, varying or waiving in any manner the rights of Lenders, Agent or Borrower thereunder or the conditions, provisions or terms thereof of waiving any Event of Default thereunder, but only to the extent specified in such written agreements; provided, however, that no such supplemental agreement shall, without the consent of all the Lenders and with respect to clause (v) below, the consent of Agent:

(i) increase the Commitment Percentage of any Lender.

(ii) extend the maturity of any Note or the due date for any amount payable hereunder, or increase any of the Advance Rates, or decrease the rate of interest or reduce any principal payment due on the Loans or fee payable by Borrower to Lenders pursuant to this Agreement (it being understood and agreed, however, that any vote to rescind any acceleration of the Liabilities made pursuant to paragraph 17 hereof shall only require the vote of the Required Lenders).

(iii) alter the definition of the term Required Lenders or alter, amend or modify this paragraph 23(b).

(iv) release any Collateral during any calendar year having an aggregate value in excess of $50,000, other than Collateral which is permitted to be sold or otherwise disposed of pursuant to paragraph 4(a) hereof.

(v) change the rights and duties of Agent.

(vi) permit any Revolving Loan to be made if after giving effect thereto the total of Revolving Loans outstanding hereunder would exceed one hundred and ten percent (110%) of the Borrowing Base for more than sixty (60) consecutive Business Days.

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

Notwithstanding the foregoing, Agent may in its sole discretion and without the consent of the Required Lenders, voluntarily permit the outstanding Revolving Loans at any time to exceed the Borrowing Base by up to one hundred and ten percent (110%) of the Borrowing Base for up to sixty (60) consecutive Business Days. All such Loans made in connection with the foregoing sentence shall be Revolving Loans and each Lender shall be required to fund such Revolving Loans in accordance with the terms of this Agreement. For purposes of the preceding sentence, the discretion granted to Agent hereunder shall not preclude involuntary overadvances that may result from time to time due to the fact that the Borrowing Base was unintentionally exceeded for any reason, including, but not limited to, Collateral previously deemed to be either “Eligible Accounts”, “Eligible Inventory” or “Eligible L/C Inventory”, as applicable, becomes ineligible, collections of Accounts applied to reduce outstanding Revolving Loans are thereafter

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returned for insufficient funds or overadvances are made to protect or preserve the Collateral. In the event Agent involuntarily permits the outstanding Revolving Loans to exceed the Borrowing Base by more than ten percent (10%), Agent shall decrease such excess in as expeditious a manner as practicable under the circumstances and not inconsistent with the reason for such excess. Revolving Loans made after Agent has determined the existence of involuntary overadvances shall be deemed to be involuntary overadvances and shall be decreased in accordance with the preceding sentence. Any voluntary or involuntary overadvances permitted to be outstanding under this paragraph shall be paid by Borrower immediately following demand therefor by Agent.

In the event that Agent requests the consent of a Lender pursuant to this paragraph 23 and such consent is denied, then Agent may, at its option, require such Lender to assign its interest in the Loans to Agent or to a Designated Lender for a price equal to the then outstanding principal amount thereof plus accrued and unpaid interest and fees (including prepayment fees, if any) due such Lender, which interest and fees shall be paid upon consummation of such assignment. In the event Agent elects to require any Lender to assign its interest to Agent or to the Designated Lender, Agent will so notify such Lender in writing within forty five (45) days following such Lender’s denial, and such Lender will assign its interest to Agent or the Designated Lender, as applicable, no later than five (5) days following receipt of such notice pursuant to a Commitment Transfer Supplement executed by such Lender, Agent or the Designated Lender, as appropriate, and Agent.

24. PARTICIPATIONS AND ASSIGNMENT.

(a) Borrower acknowledges that in the regular course of commercial banking business one or more Lenders may at any time and from time to time sell participating interests in the Loans to other financial institutions (each such transferee or purchaser of a participating interest, a “Transferee”). Each Transferee may exercise all rights of payment (including without limitation rights of set-off) with respect to the portion of such Loans held by it or other Liabilities payable hereunder as fully as if such Transferee were the direct holder thereof, provided, however, that Borrower shall not be required to pay to any Transferee more than the amount which it would have been required to pay to the Lender which granted an interest in its Loans or other Liabilities payable hereunder to such Transferee had such Lender retained such interest in the Loans hereunder or other Liabilities payable hereunder and in no event shall Borrower be required to pay any such amount arising from the same circumstances and with respect to the same Loans or other Liabilities payable hereunder to both such Lender and such Transferee. Borrower hereby grants to any Transferee a continuing security interest in any deposits, moneys or other property actually or constructively held by such Transferee as security for the Transferee’s interest in the Loans.

(b) Any Lender may with the consent of Agent which shall not be unreasonably withheld or delayed sell, assign or transfer all or any part of its rights under this Agreement and the Other Agreements to one or more additional banks or financial institutions and one or more additional banks or financial institutions may commit to make Loans hereunder (each a “Purchasing Lender”), in minimum amounts of not less than $2,000,000, pursuant to a commitment transfer supplement in form and substance satisfactory to Agent, such transfer or Lender and the Purchasing Lender (a “Commitment Transfer Supplement”), executed by such

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Purchasing Lender, the transferor Lender and Agent, and delivered to Agent for recording. Upon such execution, delivery, acceptance and recording, from and after the transfer effective date determined pursuant to such Commitment Transfer Supplement: (i) a Purchasing Lender thereunder shall be a party hereto and, to the extent provided in such Commitment Transfer Supplement, have the rights and obligations of a Lender hereunder with a Commitment Percentage as set forth therein, and (ii) the transferor Lender thereunder shall, to the extent provided in such Commitment Transfer Supplement, be released from its obligations under this Agreement, the Commitment Transfer Supplement creating a novation for that purpose. Such Commitment Transfer Supplement shall be deemed to amend this Agreement to the extent, and only to the extent, necessary to reflect the addition of such Purchasing Lender and the resulting adjustment of the Commitment Percentages arising from the purchase by such Purchasing Lender of all or a portion of the rights and obligations of such transferor Lender under this Agreement and the Other Agreements. Borrower hereby consents to the addition of such Purchasing Lender and the resulting adjustment of the Commitment Percentages arising from the purchase by such Purchasing Lender of all or a portion of the rights and obligations of such transferor Lender under this Agreement and the Other Agreements. Borrower shall execute and deliver such further documents and do such further acts and things in order to effectuate the foregoing.

(c) Agent shall maintain at its address a copy of each Commitment Transfer Supplement delivered to it and a register (the “Register”) for the recordation of the names and addresses of the Loans owing to each Lender from time to time. The entries in the Register shall be conclusive, in the absence of manifest error, and Borrower, Agent and Lenders may treat each Person whose name is recorded in the Register as the owner of the Loans recorded therein for the purposes of this Agreement. The Register shall be available for inspection by Borrower or any Lender at any reasonable time and from time to time upon reasonable prior notice. Agent shall receive a fee in the amount of $3,500 payable by the Purchasing Lender upon the transfer or assignment to such Purchasing Lender.

(d) Borrower authorizes each Lender to disclose to any Transferee or Purchasing Lender and any prospective Transferee or Purchasing Lender any and all financial information in such Lender’s possession concerning Borrower which has been delivered to such Lender by or on behalf of Borrower pursuant to this Agreement or in connection with such Lender’s credit evaluation of Borrower.

25. HEADINGS OF SUBDIVISIONS.

The headings of subdivisions in this Agreement are for convenience of reference only, and shall not govern the interpretation of any of the provisions of this Agreement.

26. POWER OF ATTORNEY.

Borrower acknowledges and agrees that its appointment of Agent as its attorney-in-fact for the purposes specified in this Agreement is an appointment coupled with an interest and shall be irrevocable until all of the Liabilities are paid in full and this Agreement is terminated.

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27. WAIVER OF JURY TRIAL; OTHER WAIVERS; CONFIDENTIALITY.

(a) AGENT, EACH LENDER AND BORROWER HEREBY WAIVE ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING WHICH PERTAINS DIRECTLY OR INDIRECTLY TO THIS AGREEMENT, ANY OF THE OTHER AGREEMENTS, THE LIABILITIES, THE COLLATERAL, ANY ALLEGED TORTIOUS CONDUCT OF BORROWER, AGENT OR LENDERS OR WHICH, IN ANY WAY, DIRECTLY OR INDIRECTLY, ARISES OUT OF OR RELATES TO THE RELATIONSHIP AMONG BORROWER, AGENT AND/OR LENDERS. IN NO EVENT SHALL AGENT OR ANY LENDER BE LIABLE FOR LOST PROFITS OR OTHER SPECIAL OR CONSEQUENTIAL DAMAGES.

(b) BORROWER HEREBY WAIVES ALL RIGHTS TO NOTICE AND HEARING OF ANY KIND PRIOR TO THE EXERCISE BY AGENT OF ITS RIGHTS TO REPOSSESS THE COLLATERAL OF BORROWER WITHOUT JUDICIAL PROCESS OR TO REPLEVY, ATTACH OR LEVY UPON SUCH COLLATERAL WITHOUT PRIOR NOTICE OR HEARING.

(c) Borrower hereby waives demand, presentment, protest and notice of nonpayment, and further waives the benefit of all valuation, appraisal and exemption laws.

(d) Agent’s or any Lender’s failure, at any time or times hereafter, to require strict performance by Borrower of any provision of this Agreement or any of the Other Agreements shall not waive, affect or diminish any right of Agent or any Lender, thereafter to demand strict compliance and performance therewith. Any suspension or waiver by Agent or any Lender, of an Event of Default under this Agreement or any default under any of the Other Agreements shall not suspend, waive or affect any other Event of Default under this Agreement or any other default under any of the Other Agreements, whether the same is prior or subsequent thereto and whether of the same or of a different kind or character. No delay on the part of Agent or any Lender in the exercise of any right or remedy under this Agreement or any Other Agreement shall preclude other or further exercise thereof or the exercise of any right or remedy. None of the undertakings, agreements, warranties, covenants and representations of Borrower contained in this Agreement or any of the Other Agreements and no Event of Default under this Agreement or default under any of the Other Agreements shall be deemed to have been suspended or waived by Agent or any Lender unless such suspension or waiver is in writing in compliance with Paragraph 23(b) hereof.

(e) Borrower has furnished and will furnish to Agent certain information concerning Borrower which Borrower has advised is non-public, proprietary or confidential in nature (“Confidential Information”). Agent confirms to the Borrower that it is Agent’s policy and practice to maintain in confidence all Confidential Information which is provided to it under agreements providing for the extension of credit and which is identified to it as such, and that it will protect the confidentiality of Confidential Information submitted to it with respect to Borrower under this Agreement, commensurate with its efforts to maintain the confidentiality of its own Confidential Information, provided, however, that: (i) nothing contained herein shall prevent Agent from disclosing Confidential Information: (A) to its affiliates and their respective directors, officers, and employees and to any legal counsel, auditors, appraisers, consultants or

72

other persons retained by it or its affiliates as professional advisors, on the condition that such information not be further disclosed except in compliance with this paragraph 27(e); (B) under color of legal authority, including, without limitation, to any regulatory authority having jurisdiction over it or its operations or to, or under the authority of, any court deemed by it to be of competent jurisdiction; (C) to any actual or potential Transferee or Purchasing Lender in Agent’s rights and obligations under this Agreement to the extent such actual or potential Transferee or Purchasing Lender has agreed to maintain such information in confidence on the basis set forth in this paragraph 27(e); and (D) as necessary in connection with the exercise of its remedies under this Agreement or any of the Other Agreements; (ii) the terms of this paragraph 27(e) shall be inapplicable to any information furnished to it which is in possession prior to the delivery to it of such information by Borrower or any other authorized Person, or otherwise has been obtained by it on a non-confidential basis, or which was or becomes available to the public or otherwise part of the public domain (other than as a result of Agent’s failure or any prospective participant’s or assignee’s failure to abide hereby), or which was not non-public, proprietary or confidential when Borrower or any other authorized Person delivered it to Agent; and (iii) the determination by Agent as to the application of any of the circumstances described in the foregoing clauses (i) and (ii) will be conclusive and binding if made in good faith.

(f) Notwithstanding subparagraph (e) above, Borrower consents to Agent publishing a tombstone or similar advertising material relating to the financing transaction contemplated by this Agreement.

73

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the date first above set forth.

LASALLE BUSINESS CREDIT, LLC, as a Lender and as Agent
By:
	Name: Title:
Commitment Percentage: 100%
IMPCO TECHNOLOGIES, INC., as Borrower
By:
	Name: Title:

74

LIST OF EXHIBITS AND SCHEDULES

1.	Exhibit A	Business and Collateral Locations
2.	Exhibit B	Customer Lists
3.	Exhibit C	Borrowing Base Certificate
4.	Exhibit D	Officer’s Certificate
5.	Exhibit 2(a)	Revolving Note
6.	Exhibit 13(a)(1)	Cash Flow Projections – First Contract Year
7.	Exhibit 13(a)(2)	Cash Flow Projections – Second and Third Contract Years
8.	Exhibit 13(d)	Locations Where Goods are Used
9.	Schedule 1(a)	Permitted Liens
10.	Schedule 1(b)	Real Property
11.	Schedule 13(a)(3)	Availability Schedule
12.	Schedule 13(q)	Permitted Indebtedness
13.	Schedule 13(s)	Parents, Subsidiaries, Affiliates or Divisions
14.	Schedule 13(w)	Intellectual Property
15.	Schedule 13(z)	Benefit Plans
16.	Schedule 13(ee)	Environmental and OSHA matters
17.	Schedule 13(ff)	Labor Disputes
18.	Schedule A	Closing Document List

EXHIBIT A - BUSINESS AND COLLATERAL LOCATIONS

1. Borrower’s business locations (please indicate which location is the principal place of business and at which locations originals and all copies of Borrower’s books, records and accounts are kept):

2. Other locations of Collateral owned by Borrower (including, without limitation, warehouse locations, processing locations, consignment locations) and all post office boxes of Borrower. Please indicate the relationship of such location to Borrower (i.e. public warehouse, processor, etc.).

EXHIBIT B - CUSTOMER LISTS

EXHIBIT C - BORROWING BASE CERTIFICATE

See Attached.

EXHIBIT D - OFFICER’S CERTIFICATE

THIS CERTIFICATE is submitted pursuant to paragraph 11 of the Loan and Security Agreement dated as of July     , 2003 (as amended, modified, restated or supplemented from time to time, the “Loan Agreement”) among LaSalle Business Credit, LLC (“LaSalle”), the various other financial institutions named therein or which hereafter become a party thereto (together with LaSalle, collectively, the “Lenders”), LaSalle as agent for Lenders (in such capacity, “Agent”), and IMPCO Technologies, Inc. (“Borrower”).

The undersigned hereby certifies to Agent or Lenders that as of the date of this Agreement:

1. The undersigned is the                      of the Borrower.

2. There exists no Default or Event of Default, (as such terms are defined in the Loan Agreement), or, if such Default or Event of Default exists, a writing attached hereto specifies the nature thereof, the period of existence thereof and the action that Borrower has taken or proposes to take with respect thereto.

3. No Material Adverse Effect (as such term is defined in the Loan Agreement) has occurred since                     , or, if a Material Adverse Effect has occurred, a writing attached hereto specifies the nature thereof and the action that Borrower has taken or proposes to take with respect thereto.

4. All insurance premiums due as of the date hereof have been paid.

5. All taxes due as of the date hereof have been paid or, for those taxes which have not been paid, a writing attached hereto describes the nature and amount of such taxes, and sets forth Borrower’s rationale for not paying such taxes and the action that Borrower has taken or proposes to take with respect thereto.

6. To the best of the undersigned’s knowledge, after appropriate inquiry, except as previously disclosed to Agent in writing, no litigation, investigation or proceeding, or injunction writ or restraining order is pending or threatened against the Borrower or, if any litigation, investigation or proceeding, or injunction, writ or restraining order is pending or threatened against the Borrower, a writing attached hereto specifies the nature thereof and the action that Borrower has taken or proposes to take with respect thereto.

7. Borrower is in compliance with the representations, warranties and covenants in the Loan Agreement, or, if Borrower is not in compliance with any representations, warranties or covenants in the Loan Agreement, a writing attached hereto specifies the nature thereof, the period of existence thereof and the action that Borrower has taken or proposes to take with respect thereto.

8. Attached hereto is a true and correct calculation of the financial covenants contained in paragraph 14(p) of the Loan Agreement.

Name:

Title:

80

EXHIBIT 2(a) - REVOLVING NOTE

See Attached.

EXHIBIT 13(a)(1) - CASH FLOW PROJECTIONS - FIRST CONTRACT YEAR

See Attached.

EXHIBIT 13(a)(2) - CASH FLOW PROJECTIONS -

SECOND AND THIRD CONTRACT YEARS

See Attached.

EXHIBIT 13(d) - LOCATIONS WHERE GOODS ARE USED

See Attached.

SCHEDULE 1(a) - PERMITTED LIENS

SCHEDULE 1(b) - REAL PROPERTY

SCHEDULE 13(a)(3) - AVAILABILITY SCHEDULE

See Attached.

SCHEDULE 13(q) - PERMITTED INDEBTEDNESS

SCHEDULE 13(s) - PARENTS, SUBSIDIARIES, AFFILIATES OR DIVISIONS

SCHEDULE 13(w) - INTELLECTUAL PROPERTY

SCHEDULE 13(z) - BENEFIT PLANS

SCHEDULE 13(ee) - ENVIRONMENTAL AND OSHA MATTERS

SCHEDULE 13(ff) - LABOR DISPUTES

SCHEDULE A - CLOSING DOCUMENT LIST

See Attached.

TABLE OF CONTENTS

		Page
1.	DEFINITIONS.	1
2.	REVOLVING LOANS.	20
3.	LETTER OF CREDIT.	21
4.	MANDATORY PREPAYMENTS	24
5.	INTEREST, FEES AND CHARGES.	25
6.	LOAN ADMINISTRATION.	27
7.	GRANT OF SECURITY INTEREST TO AGENT	32
8A.	CONCERNING ARTICLE 9 OF THE UNIFORM COMMERCIAL CODE .	32
8.	PRESERVATION OF COLLATERAL AND PERFECTION OF SECURITY INTERESTS THEREIN.	33
9.	POSSESSION OF COLLATERAL AND RELATED MATTERS.	33
10.	COLLECTIONS.	33
11.	SCHEDULES AND REPORTS.	36
12.	TERM.	38
13.	REPRESENTATIONS AND WARRANTIES.	39
14.	COVENANTS.	45
15.	CONDITIONS PRECEDENT.	56
16.	DEFAULT.	60
17.	REMEDIES UPON AN EVENT OF DEFAULT.	62
18.	INDEMNIFICATION.	63
19.	REGARDING AGENT.	64
20.	NOTICES.	67
21.	CHOICE OF GOVERNING LAW AND CONSTRUCTION.	67
22.	FORUM SELECTION AND SERVICE OF PROCESS.	68

i

TABLE OF CONTENTS

(Continued)

23.	MODIFICATION AND BENEFIT OF AGREEMENT.	68
24.	PARTICIPATIONS AND ASSIGNMENT.	70
25.	HEADINGS OF SUBDIVISIONS.	71
26.	POWER OF ATTORNEY.	71
27.	WAIVER OF JURY TRIAL; OTHER WAIVERS; CONFIDENTIALITY.	72

ii

EX-10.72

EXHIBIT 10.72

SECURITIES PURCHASE AGREEMENT

by and between

IMPCO TECHNOLOGIES, INC.

and

BISON CAPITAL STRUCTURED EQUITY PARTNERS, LLC

Senior Subordinated Secured Promissory Note Due July 18, 2007

Warrant to Purchase Shares of Common Stock

Dated as of July 18, 2003

TABLE OF CONTENTS

			Page
ARTICLE 1 DEFINITIONS			1
	1.1	Definitions	1
	1.2	Accounting Terms	20
	1.3	Other Definitional Provisions	20
ARTICLE 2 PURCHASE AND SALE OF THE SECURITIES			21
	2.1	Purchase and Sale of the Note	21
	2.2	Purchase and Sale of the Warrant	21
	2.3	Fees at Closing; Annual Fees	21
	2.4	Closing	21
	2.5	Financial Accounting Positions; Tax Reporting	22
	2.6	Default Rate of Interest	22
	2.7	Monthly Interest Statement	22
ARTICLE 3 CONDITIONS TO THE OBLIGATIONS OF PURCHASER TO PURCHASE THE SECURITIES			23
	3.1	Representations and Warranties	23
	3.2	Compliance with this Agreement	23
	3.3	Secretary’s Certificates; Good Standing Certificates	23
	3.4	Documents	24
	3.5	Purchase of Securities Permitted by Applicable Laws	25
	3.6	Opinions of Counsel	25
	3.7	Approval of Counsel to Bison Capital	25
	3.8	Consents and Approvals	25
	3.9	Transaction Documents	25
	3.10	No Material Judgment or Order	25
	3.11	Pro Forma Balance Sheets	26
	3.12	Certificates	26
	3.13	No Litigation	26
	3.14	No Event of Default	26
	3.15	Closing Fees	26
	3.16	Repayment of Existing Credit Facilities; Senior Credit Agreement	26
	3.17	No Material Adverse Change	27
	3.18	Pledged Collateral	27
	3.19	Filings, Registrations and Recordings	27
	3.20	Business Plan	27
	3.21	Budget	27
	3.22	Minimum Liquidity	27
	3.23	Press Release, etc	28
	3.24	Intercreditor Agreement	28
	3.25	Other Obligations	28
	3.26	Assignment of the BRC Agreements and the Quantum Strategic Alliance Agreement; Consents	28
	3.27	Waiver of Joint Company Buy-Out Agreement	28
	3.28	Irrevocable Instructions	28
	3.29	Notarial Deed	28

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TABLE OF CONTENTS

			Page
ARTICLE 4 CONDITIONS TO THE OBLIGATIONS OF THE COMPANY TO ISSUE AND SELL THE SECURITIES			29
	4.1	Representations and Warranties	29
	4.2	Compliance with this Agreement	29
	4.3	Purchase Permitted by Applicable Laws	29
	4.4	Payment for Securities	29
ARTICLE 5 REPRESENTATIONS AND WARRANTIES OF THE CREDIT PARTIES			29
	5.1	No Encumbrances	29
	5.2	Equipment	29
	5.3	Location of Collateral; Chief Executive Office; FEIN	29
	5.4	Inventory and Equipment Records	30
	5.5	Due Organization and Qualification; Subsidiaries.	30
	5.6	Due Authorization; No Conflict.	30
	5.7	Litigation	31
	5.8	No Material Adverse Change.	31
	5.9	Fraudulent Transfer.	32
	5.10	Environmental Condition	32
	5.11	Brokerage Fees	33
	5.12	Proprietary Rights	33
	5.13	Leases.	33
	5.14	DDAs	33
	5.15	Complete Disclosure	33
	5.16	Indebtedness	34
	5.17	Private Offering; NASDAQ Compliance; Investment Company Act; Public Utility	34
	5.18	Use of Proceeds	35
	5.19	Federal Regulations	35
	5.20	Labor Matters	36
	5.21	Employee Benefit Plans; ERISA	36
	5.22	Taxes	39
	5.23	Contingent Obligations	41
	5.24	Other Obligations	41
	5.25	Power of Attorney	42
	5.26	Relationship with General Electric Company	42
ARTICLE 6 REPRESENTATIONS AND WARRANTIES OF PURCHASER			42
	6.1	Due Organization	42
	6.2	Authorization; No Contravention	42
	6.3	Binding Effect	42
	6.4	No Legal Bar	42
	6.5	Purchase for Own Account	42
	6.6	Broker’s Finder’s or Similar Fees	43
	6.7	Governmental Authorization: Third Party Consent	43
ARTICLE 7 INDEMNIFICATION			43

ii

TABLE OF CONTENTS

			Page
	7.1	Indemnification.	43
	7.2	Procedure; Notification	45
	7.3	Registration Rights Agreement	45
ARTICLE 8 AFFIRMATIVE COVENANTS			45
	8.1	Accounting System	46
	8.2	Reporting Package	46
	8.3	Financial Statements, Reports, Certificates	46
	8.4	Credit Party Reports	51
	8.5	Maintenance of Properties, etc.	51
	8.6	Taxes.	51
	8.7	Insurance	51
	8.8	Location of Collateral	53
	8.9	Compliance with Laws	53
	8.10	Leases	54
	8.11	Brokerage Commissions	54
	8.12	Conduct of Business and Maintenance of Existence, etc.	54
	8.13	Environmental	54
	8.14	Disclosure Updates	54
	8.15	Monitoring Rights.	55
	8.16	Reservation of Shares of Equity of the Company	55
	8.17	ERISA Matters	56
	8.18	Payment of Obligations	57
	8.19	Inspection of Property; Books and Records; Discussions	57
	8.20	Other Obligations	57
	8.21	Additional Collateral, etc.	57
	8.22	Stockholder Approval	58
	8.23	Further Assurances	59
	8.24	Lost, etc. Certificates Evidencing Warrant Securities; Exchange	59
	8.25	Transactions with General Electric Company or its Affiliates	59
	8.26	BRC Financial Audit	59
	8.27	BRC Financial Forecasts	59
	8.28	Nasdaq National Stock Market	60
	8.29	Chief Executive Officer	60
	8.30	Obtain Consents for Pledge of Joint Ventures	60
ARTICLE 9 NEGATIVE COVENANTS			60
	9.1	Indebtedness	60
	9.2	Liens	61
	9.3	Restrictions on Fundamental Changes	62
	9.4	Change Name	62
	9.5	Guarantee	62
	9.6	Nature of Business	63
	9.7	Prepayments and Amendments	63
	9.8	Consignments	63
	9.9	Restricted Payments	63
	9.10	Accounting Methods	64

iii

TABLE OF CONTENTS

			Page
	9.11	Investments; Acquisitions; Subsidiaries	64
	9.12	Transactions with Affiliates	65
	9.13	Suspension	65
	9.14	Compensation	65
	9.15	Use of Proceeds	65
	9.16	Change in Location of Chief Executive Office; Inventory and Equipment with Bailees	65
	9.17	Securities Accounts	66
	9.18	Financial Covenants	66
	9.19	Limitation on Optional Payments and Modifications of Documents	67
	9.20	Limitation on Sales and Leasebacks	68
	9.21	Limitation on Negative Pledge Clauses	68
	9.22	Limitation on Restrictions on Subsidiary Distributions, etc	68
	9.23	Fiscal Year	68
	9.24	Partnerships and Joint Ventures	68
	9.25	Solicitation	68
	9.26	Margin Stock	69
	9.27	Investment Company Act	69
	9.28	Consulting Fees	69
	9.29	Other Obligations	69
	9.30	Credit; Outstanding Receivables.	69
	9.31	Contingent Obligations	70
	9.32	Payment of Existing Indebtedness	71
	9.33	Issuance of Equity	71
	9.34	Restricted Financings	71
	9.35	New Accounts	71
	9.36	Amendments to the Senior Credit Documents	71
ARTICLE 10 EVENTS OF DEFAULT			71
	10.1	Events of Default	71
	10.2	Rights and Remedies	74
	10.3	No Waiver; Cumulative Remedies	77
ARTICLE 11 NOTE REDEMPTION			77
	11.1	Optional Redemption of Note; Change of Control	77
	11.2	Excess Cash Flow; Mandatory Redemption	78
	11.3	Exercise of Option by BRC Shareholders; Mandatory Redemption	78
	11.4	Application of Proceeds	79
ARTICLE 12 PUT OPTION			79
	12.1	Purchaser Put Option	79
ARTICLE 13 THE COLLATERAL AGENT			79
	13.1	Bison Capital as the Collateral Agent	79
	13.2	Maintenance of Register	81
ARTICLE 14 MISCELLANEOUS			81

iv

TABLE OF CONTENTS

		Page
14.1	Survival of Representations and Warranties	81
14.2	Notices	81
14.3	Successors and Assigns	82
14.4	Amendment and Waiver.	82
14.5	Signatures; Counterparts	83
14.6	Headings	83
14.7	Governing Law	83
14.8	Determinations, Request or Consents	83
14.9	Jurisdiction, Jury Trial Waiver, Etc.	83
14.10	Severability	84
14.11	Entire Agreement	84
14.12	Publicity	84
14.13	Further Assurances	84
14.14	No Usurious Interest	85
14.15	Suretyship Waivers.	85
14.16	Construction.	85
14.17	Acknowledgments	85
14.18	Survival of Rights	86
14.19	Joint and Several Liability	86
14.20	Contribution and Indemnification among the Credit Parties	87
14.21	Additional Rights of Contribution	87
14.22	Agency of the Company for each other Credit Party	87
14.23	Expenses	87
14.24	Prevailing Party; Attorney’s Fees	88
14.25	Certain Covenants of Purchaser	88

v

TABLE OF CONTENTS

EXHIBITS

A	Form of Note
B	Form of Warrant Agreement
C	Form of Guarantee
D	Form of Consent to Assignment of Agreement
E	Form of Registration Rights Agreement
F	Form of Compliance Certificate
G	Form of Intercreditor Agreement
H	Form of Solvency Certificate
I-1	Form of Opinion of Company U.S. Counsel
I-2	Form of Opinion of Company Italian Counsel
J	Form of Collateral Access Agreement
K	Form of Intellectual Property Security Agreement
L	Form of Pledge Agreement
M	Form of Control Agreement
N	Projections
O	Form of Security Agreement
P	Form of Joinder Agreement
Q	Financial Statements
R	Deed of Pledge
S	Irrevocable Instructions

SCHEDULES

Schedule 1	Securities
Schedule 2	Affiliates
Schedule 3	Senior Credit Documents
Schedule 3.11	Pro Forma Balance Sheets
Schedule 5.3	Location of Chief Executive Office; FEIN; Jurisdiction of Organization
Schedule 5.5(b)	Capital Equity
Schedule 5.10	Environmental Condition
Schedule 5.11	Brokerage Fees
Schedule 5.12	Proprietary Rights
Schedule 5.14	Bank Accounts
Schedule 5.16	Indebtedness
Schedule 5.18	Use of Proceeds
Schedule 5.21	ERISA
Schedule 5.22	Taxes
Schedule 5.23	Contingent Obligations
Schedule 5.24	Other Obligations
Schedule 5.26	Relationship with General Electric Company
Schedule 8.2	Reporting Package
Schedule 9.2	Liens
Schedule 9.3	Fundamental Changes
Schedule 9.12	Transaction with Affiliates
Schedule 9.14	Directors’ Fees

vi

TABLE OF CONTENTS

Schedule 9.24 Partnerships and Joint Ventures

vii

SECURITIES PURCHASE AGREEMENT

SECURITIES PURCHASE AGREEMENT, dated as of July 18, 2003, by and between IMPCO TECHNOLOGIES, INC., a Delaware corporation (the “Company”), and BISON CAPITAL STRUCTURED EQUITY PARTNERS, LLC, a Delaware limited liability company (“Bison Capital” or “Purchaser”).

WITNESSETH

WHEREAS, the Company wishes to sell to Bison Capital and Bison Capital wishes to purchase from the Company (i) a senior subordinated secured promissory note (the “Note”) due July 18, 2007, in the principal amount set forth in Schedule 1, and (ii) a warrant (the “Warrant”) to purchase the number of shares of Common Stock set forth in Schedule 1, (the “Warrant Securities”), in each case upon the terms and subject to the conditions hereinafter set forth.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein and for other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto agree as follows:

ARTICLE 1

DEFINITIONS

1.1 Definitions. As used in this Agreement, and unless the context requires a different meaning, the following terms have the meanings indicated:

“Account Debtor” shall mean any Person who is or who may become obligated under, with respect to, or on account of, an Account, Chattel Paper, or a General Intangible.

“Accounts” shall have the meaning assigned to that term in the Security Agreement.

“Acknowledgement and Consent” shall mean an Acknowledgement and Consent executed by each issuer of the stock pledged pursuant to the Transaction Documents, substantially in the form of Acknowledgement and Consent attached to the Stock Pledge Agreement.

“Affiliate” shall mean any Person (a) directly or indirectly controlling, controlled by, or under common control with, the Company, (b) directly or indirectly owning or holding five percent (5%) or more of any equity interest in the Company, or (c) five percent (5%) or more of whose voting stock or other equity interest is directly or indirectly owned or held by the Company, excluding, in each case, Purchaser and its affiliates (other than the Credit Parties), and shall include, without limitation, each of the Persons identified on Schedule 2, each of the Company’s Executive Officers or Representatives that meets the criteria in any of clauses (a), (b) or (c) of this definition, and each of their respective successors (whether or not such successors hold different or additional offices than the Persons they succeed). For purposes of this definition, “control” (including with correlative meanings, the terms “controlling”, “controlled

1

by” and under “common control with”) means the possession, directly or indirectly, of the 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.

“Affiliated Group” shall have the meaning set forth in Section 1504(a) of the Code.

“Agreement” shall mean this Agreement, including the exhibits and schedules attached hereto, as the same may be amended, restated, supplemented or modified from time to time in accordance with the terms hereof.

“Asset Disposition” shall mean the disposition, whether by sale, lease, transfer, loss, damage, destruction, condemnation or otherwise of any of the following: (a) any of the Equity of the Company, any of its Subsidiaries or any other Credit Party or (b) any or all of the assets of the Company, any of its Subsidiaries or any other Credit Party other than sales of Inventory or Equipment in the ordinary course of business consistent with prudent business practice.

“Bankruptcy Code” shall mean the United States Bankruptcy Code, as in effect from time to time, and any successor statute thereto.

“Benefit Plans” shall have the meaning assigned to that term in Section 5.21.

“Bison Capital” shall have the meaning set forth in the first paragraph of this Agreement.

“BOFA Credit Agreement” shall mean that certain Business Loan Agreement, dated as of April 30, 2001, by and between the Company and Bank of America, N.A., as amended to the date hereof and as further amended and extended.

“Books” means all of the Company’s, its Subsidiaries’ or any other Credit Party’s books and records (including all of its Records indicating, summarizing, or evidencing its assets (including the Collateral) or liabilities, all of the Company’s, its Subsidiaries’ or the other Credit Parties’ Records relating to its or their business operations or financial condition, and all of its or their goods or General Intangibles related to such information).

“BRC” shall mean B.R.C. Societa a Responsabilità Limitata, an Italian limited liability company.

“BRC Agreements” shall collectively mean the BRC Sale and Purchase Agreement, the BRC Option Agreement, the BRC Lock-up Agreement, the BRC Option Deed and the BRC Shareholders Agreement, together with all amendments thereof and other documents ancillary thereto.

“BRC Consent and Assignment” shall mean that certain Consent to Consignment, dated as of the date hereof, by and among the Company, the BRC Shareholders and Purchaser.

2

“BRC Lock-up Agreement” shall mean, collectively, the form of lockup agreement contemplated by the BRC Option Agreement and executed by each of the BRC Shareholders in favor of the Company, as amended from time to time.

“BRC Option Agreement” shall mean that certain Option Agreement, dated as of October 3, 2002, by and among the Company and the controlling shareholders of BRC, as amended from time to time.

“BRC Option Deed” shall mean that certain Options Deed, dated as of May 8, 2003, by and among Mariano Costamagna, Pier Antonio Costamagna and the Company.

“BRC Sale and Purchase Agreement” shall mean that certain Sale and Purchase Agreement, dated as of May 8, 2003, by and among the Company and the BRC Shareholders, as amended from time to time.

“BRC Shareholders” shall mean each of Mariano Costamagna, Pier Antonio Costamagna, Bruna Giachino and Carla Borgogno.

“BRC Shareholders Agreement” shall mean that certain Shareholders Agreement, dated as of May 8, 2003 by and among the Company, Mariano Costamagna and Pier Antonio Costamagna, as amended from time to time in the form contemplated by the BRC Option Agreement.

“BRC Transaction” shall mean the payment on or before September 30, 2003 of the Deferred Portion of the Purchase Price (as such term is defined in the BRC Sale and Purchase Agreement) and such other actions as are contemplated by the BRC Agreements to be performed by the Company to fully consummate its acquisition of 50% of the currently outstanding Equity of BRC in accordance with the BRC Sale and Purchase Agreement and this Agreement.

“Bridge Loan Subordination Agreements” shall mean collectively, (i) that certain Subordination Agreement, dated as of July 15, 2003, by and among Olywood LLC, Bison Capital, the Company and the Senior Lender and (ii) that certain Subordination Agreement, dated as of July 15, 2003, by and among Jon Adams, Bison Capital, the Company and the Senior Lender.

“Business Day” shall mean any day other than a Saturday, Sunday or other day on which commercial banks in the City of New York are authorized or required by law or executive order to close.

“Capital Expenditures” shall mean, for any period and with respect to any Person, without duplication, the sum of (1) all expenditures during such period by such Person that would be classified as capital expenditures in accordance with GAAP or are made in property that is the subject of a synthetic, off-balance sheet or Tax retention lease to which such Person is a lessee, and (2) the entire principal amount of any Indebtedness assumed or incurred in connection with any such expenditures, excluding any such expenditure made (a) to restore, replace or rebuild property to the condition of such property immediately prior to any damage, loss, destruction or condemnation of such property, to the extent such expenditure is otherwise not prohibited under this Agreement and is made with insurance proceeds or condemnation

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awards relating to any such damage, loss, destruction or condemnation or (b) with proceeds from the sale or exchange of property to the extent utilized to purchase functionally equivalent property or equipment.

“Capital Lease” shall mean a lease that is required to be capitalized for financial reporting purposes in accordance with GAAP.

“Capital Lease Obligations” of any Person shall mean any Indebtedness represented by obligations under a Capital Lease.

“Cash Equivalents” shall mean: (a) marketable direct obligations issued or unconditionally guaranteed by the United States or issued by any agency thereof and backed by the full faith and credit of the United States, in each case maturing within one (1) year from the date of acquisition thereof, (b) marketable direct obligations issued by any state of the United States or any political subdivision of any such state or any public instrumentality thereof maturing within one (1) year from the date of acquisition thereof and, at the time of acquisition, having the highest rating obtainable from either Standard & Poor’s rating service (“S&P”) or Moody’s Investors Service, Inc. (“Moody’s”), (c) commercial paper maturing no more than two hundred seventy (270) days from the date of acquisition thereof and, at the time of acquisition, having a rating of A-1 or P-1, or better, from S&P or Moody’s, and (d) certificates of deposit or bankers’ acceptances maturing within one (1) year from the date of acquisition thereof that are either (i) issued by any bank organized under the laws of the United States or any state thereof which bank has a rating of A or A2, or better, from S&P or Moody’s, or (ii) in an amount less than or equal to $100,000 in the aggregate if issued by any other bank insured by the Federal Deposit Insurance Corporation.

“CERCLA” shall mean the Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C. 9601 et seq.), as amended from time to time, and any successor statute thereto.

“Change of Control” shall mean the occurrence of any of the following: (i) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act) shall become, or obtain rights (whether by means or warrants, options or otherwise) to become, the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of more than twenty-five percent (25%) of the outstanding Equity of the Company (including Equity issuable upon exercise of any outstanding options or warrants on an as converted basis); (ii) the Board of Directors of the Company shall cease to consist of a majority of the Closing Directors; (iii) the Board of Directors or shareholders of any Credit Party shall approve any plan of liquidation or dissolution of such Credit Party other than in the case of a Permitted Disposition; (iv) any Credit Party shall cease to own of record and beneficially one hundred percent (100%) of the Equity it owns as of the Closing Date of each of its Subsidiaries existing on the Closing Date; provided, that a Change of Control shall not be deemed to have occurred with respect to the liquidation of any Subsidiary in connection with the termination of any venture or line of business so long as the same does not represent a Material Adverse Effect; or (v) a breach of any change of ownership or control provision under the Senior Credit Agreement or any other existing or future credit or loan agreements to which any Credit Party is a party.

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“Chattel Paper” shall have the meaning assigned to that term in the Security Agreement.

“Claims” shall have the meaning assigned to that term in Section 7.1.

“Closing” shall have the meaning assigned to that term in Section 2.4.

“Closing Date” shall have the meaning assigned to that term in Section 2.4.

“Closing Directors” shall mean, as to the Company, the directors of the Company on the Closing Date, after giving effect to the transactions contemplated hereby.

“COBRA” shall mean the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, as set forth in Section 4980B of the Code and Part 6 of Title I of ERISA.

“Code” shall mean the Internal Revenue Code of 1986, as amended from time to time, and any successor statute thereto.

“Collateral” shall mean all Property of the Credit Parties, now owned or hereafter acquired, upon which a Lien is purported to be created by any Security Document, including, without limitation, Collateral constituting Proprietary Rights.

“Collateral Access Agreement” shall mean a landlord waiver, bailee letter, or acknowledgement agreement of any lessor, warehouseman, processor, consignee, or other Person in possession of, having a Lien upon, or having rights or interests in the Equipment or Inventory, in each case, on terms and conditions no less favorable to Purchaser than the terms and conditions of the corresponding landlord waiver, bailee letter or acknowledgment provided to the Senior Lender in connection with the Senior Credit Agreement, and otherwise in form and substance satisfactory to Purchaser substantially in the form of Exhibit J.

“Collateral Agent” shall have the meaning assigned to that term in Section 13.1.

“Collateral Assignment Consent” shall mean a collateral assignment consent substantially in the form attached hereto as Exhibit D.

“Common Stock” shall mean the Company’s common stock, par value $0.001 per share (including, without limitation, the Warrant Securities), or any other capital stock of the Company (including, without limitation, any preferred stock) into which such stock is reclassified or reconstituted.

“Company SEC Documents” shall have the meaning assigned to that term in Section 5.15(b).

“Compliance Certificate” shall mean a Compliance Certificate substantially in the form of Exhibit F.

“Consolidated EBITDA” shall mean, for any period, the consolidated EBITDA of the Consolidated Group, in accordance with GAAP.

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“Consolidated Group” shall mean the Company and the Consolidated Subsidiaries.

“Consolidated Interest Expense” shall mean, of any Person for any period, total interest expense (net of any interest income) (including that attributable to Capital Lease Obligations) of such Person and its Subsidiaries and amortization or write-off of debt discount and debt issuance costs and commissions, discounts and other fees, charges and expenses associated with Indebtedness (including, in the case of the Company, the Note) for such period with respect to all outstanding Indebtedness of such Person and its Subsidiaries (including, without limitation, all commissions, discounts and other fees, charges and expenses owed by such Person and paid during such period with respect to letters of credit and bankers’ acceptance financing and net costs of such Person under Hedge Agreements in respect of interest rates to the extent such net costs are allocable to such period in accordance with GAAP).

“Consolidated Leverage Ratio” shall mean, as at the last day of any period of four (4) consecutive fiscal quarters, the ratio of (a) Indebtedness of the Consolidated Group on such day to (b) Consolidated EBITDA for such periods.

“Consolidated Subsidiaries” shall mean IMPCO Technologies Pty Limited, IMPCO Technologies (SA) Pty. Ltd., IMPCO Technologies (NSW) Pty. Ltd., IMPCO Fuel Systems Pty Ltd, IMPCO Technologies Japan, KK, Grupo I.M.P.C.O. Mexicano, IMPCO-BERU Technologies B.V., IMPCO-BERU Technologies GmbH, IMPCO-BERU Technologies S.A.R.L., IMPCO-BERU Technologies Limited, Minda IMPCO Technologies Limited, Minda IMPCO Limited, and CNGC—IMPCO Technologies, LLC.

“Contingent Obligation” as applied to any Person, shall mean any direct or indirect liability, contingent or otherwise, of that Person: (i) with respect to any underlying indebtedness, lease, dividend or other obligation of another Person if the primary purpose or intent of the Person incurring such liability, or the primary effect thereof, is to provide assurance to the obligee of such liability that the underlying indebtedness, lease, dividend or other obligation will be paid or discharged, or that any agreements relating thereto will be complied with, or that the holders of such liability will be protected (in whole or in part) against loss with respect thereto; (ii) with respect to any letter of credit issued for the account of that Person or as to which that Person is otherwise liable for reimbursement of drawings; or (iii) under any foreign exchange contract, currency swap agreement, interest rate swap agreement or other similar agreement or arrangement designed to alter the risks of that Person arising from fluctuations in currency values or interest rates. Contingent Obligations shall include (a) the direct or indirect guaranty, endorsement (other than for collection or deposit in the ordinary course of business), co-making, discounting with recourse or sale with recourse by such Person of the obligation of another, (b) the obligation to make take-or-pay or similar payments if required regardless of nonperformance by any other party or parties to an agreement, or to maintain working capital or equity capital of such other Person or otherwise to maintain the net worth or solvency of such other Person, (c) any liability of such Person for the obligations of another through any agreement to purchase, repurchase or otherwise acquire such obligation or any property constituting security therefor, to provide funds for the payment or discharge of such obligation or to maintain the solvency, financial condition or any balance sheet item or level of income of another, and (d) otherwise to assure or hold harmless the owner of any of the foregoing obligations against loss in respect thereto. The amount of any Contingent Obligation shall be

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equal to the amount of the obligation so guaranteed or otherwise supported or, if not a fixed and determined amount, the maximum amount so guaranteed.

“Contractual Obligations” shall mean as to any Person, any provision of any security issued by such Person or of any agreement, undertaking, contract, indenture, mortgage, deed of trust or other instrument or arrangement (whether in writing or otherwise) to which such Person is a party or by which it or any of such Person’s property is bound.

“Control” shall mean, with respect to any Person, the power to direct the management and policies of such Person.

“Control Agreement” shall mean a securities accounts control agreement substantially in the form of Exhibit M as the same may be amended, restated, supplemented or modified from time to time in accordance with its terms.

“Credit Parties” shall mean the Company, each of its respective Subsidiaries (other than its Foreign Subsidiaries), each Guarantor and each other Person (other than the Collateral Agent, Purchaser and the BRC Shareholders) that is party to any Transaction Document (including pursuant to Section 8.21); provided, however, that the Company’s Foreign Subsidiaries shall be deemed a Credit Party for purposes of Articles 8, 9 and 10.

“DDA” shall mean any checking or other demand deposit account maintained by a Credit Party.

“Deed of Pledge” shall mean a deed of pledge substantially in the form of Exhibit R as the same may be amended, restated, supplemented or modified from time to time in accordance with its terms.

“Default” shall mean an event, condition, or default that, with the giving of notice, the passage of time, or both, would be an Event of Default.

“Defined Benefit Plan” shall mean a defined benefit plan within the meaning of Section 3(35) of ERISA or Section 414(j) of the Code, whether funded or unfunded, qualified or non-qualified (whether or not subject to ERISA or the Code).

“Derivatives Counterparty” shall have the meaning assigned to that term in Section 9.9.

“Disqualified Stock” shall mean any stock or other ownership or profit interest of any Credit Party in respect of which any Credit Party is or, upon the passage of time or the occurrence of any event, may become obligated to redeem, purchase, retire, defease or otherwise make any payment other than in the form of stock (other than Disqualified Stock).

“Dollars” or “$” shall mean United States dollars.

“EBITDA” shall mean, with respect to any applicable fiscal period, the following for any Person or Persons, each calculated for such fiscal period: net income before taxes for such period (excluding pre-tax gains or losses on the sale of assets (other than the sales of Inventory in the ordinary course of business) and excluding other pre-tax extraordinary gains)

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plus cash interest expense, depreciation, amortization and other non-cash charges deducted in determining net income for such period, minus interest income calculated in determining net income for such fiscal period.

“Environmental Laws” shall mean any applicable federal, state, provincial, foreign or local statute, law, rule, regulation, ordinance, code, binding and enforceable guideline, binding and enforceable written policy or rule of common law now or hereafter in effect and in each case as amended, or any judicial or administrative interpretation thereof, including any judicial or administrative order, consent decree or judgment, to the extent binding on the Company, any of its Subsidiaries or any other Credit Party, relating to the environment, health and safety, or Hazardous Materials, including, without limitation, CERCLA; the Resource Conservation and Recovery Act, 42 USC 6901 et seq. (“RCRA”); the Federal Water Pollution Control Act, 33 USC § 1251 et seq.; the Toxic Substances Control Act, 15 USC, § 2601 et seq.; the Clean Air Act, 42 USC § 7401 et seq.; the Safe Drinking Water Act, 42 USC § 3803 et seq.; the Oil Pollution Act of 1990, 33 USC § 2701 et seq.; the Emergency Planning and the Community Right-to-Know Act of 1986, 42 USC § 11001 et seq.; the Hazardous Material Transportation Act, 49 USC § 1801 et seq.; and the Occupational Safety and Health Act, 29 USC §651 et seq. (to the extent it regulates occupational exposure to Hazardous Materials); any state and local or foreign counterparts or equivalents, in each case as amended from time to time.

“Equipment” shall have the meaning assigned to that term in the Security Agreement.

“Equity” means all shares, membership interests, options, warrants, interests, participations, or other equivalents (regardless of how designated) of or in a Person, whether voting or nonvoting, including common stock, preferred stock, or any other “equity security” (as such term is defined in Rule 3a11-1 promulgated under the Exchange Act).

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

“ERISA Affiliate” shall have the meaning assigned to that term in Section 5.21.

“Event of Default” shall have the meaning assigned to that term in Section 10.1.

“Excess Cash Flow” shall mean for any fiscal year of the Company, the amount, if any, by which (i) the sum, without duplication, of: (a) the Consolidated EBITDA of the Company and its Subsidiaries (other than Foreign Subsidiaries and BRC) for such fiscal year; and (b) any distribution from BRC, any Unconsolidated Affiliate or any Foreign Subsidiary to the Company and its Subsidiaries; exceeds (ii) the sum of: (a) Consolidated Interest Expense of the Company and its Subsidiaries (excluding its Foreign Subsidiaries and BRC) to the extent paid in cash during such fiscal year; (b) the aggregate amount of principal repayments made in connection with any term loan under the Senior Credit Agreement; (c) the aggregate amount of all Capital Expenditures of the Company and its Subsidiaries (excluding its Foreign Subsidiaries and BRC) made in accordance with Section 9.18 during such fiscal year (excluding Capital Expenditures funded by Purchase Money Indebtedness); and (d) the aggregate amount of any income taxes paid (or to be paid within that fiscal year) by the Company or its Subsidiaries

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(excluding its Foreign Subsidiaries and BRC) with respect to such fiscal year, net of tax benefits creditable against or allocable to the same.

“Excess Cash Flow Payments” shall have the meaning assigned to that term in Section 11.2; sometimes referred to individually as an “Excess Cash Flow Payment”.

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended from time to time, and any successor statute thereto, and the rules and regulations of the SEC thereunder.

“Executive Officer” shall mean, with respect to any Person, (i) any other Person titled as, or otherwise performing for or on behalf of such Person the functions typically performed by, a chairman, a chairwoman, a chief executive officer, a chief financial officer or a chief operating officer (or the equivalents thereof, in the case of non-corporate entities), and/or (ii) any other person in charge of a principal business unit, division or function (such as sales, administration or finance) of, or who performs a policy making function for, such first Person. For the avoidance of doubt, each of Robert M. Stemmler, Brad E. Garner and Timothy S. Stone shall constitute an Executive Officer of the Company on the date hereof.

“Existing Notes” shall mean the promissory notes and other instruments evidencing the indebtedness listed in Schedule 5.16.

“Federal Reserve Board” shall mean the Board of Governors of the Federal Reserve System of the United States (or any successor).

“Fee Letter” shall mean that certain letter, dated as of the date hereof, by and between the Company and Bison Capital Asset Management, LLC.

“FEIN” shall mean Federal Employer Identification Number.

“Fiduciary” shall mean a “fiduciary” as that term is defined in Section 3(21) of ERISA.

“Foreign Subsidiary” shall mean any Subsidiary of any Person that is organized under the laws of a jurisdiction other than the United States or any state thereof or the District of Columbia.

“Future Foreign Subsidiaries” shall have the meaning assigned to such term in Section 9.30(d).

“GAAP” shall mean generally accepted accounting principles in effect within the United States, consistently applied.

“General Intangibles” shall have the meaning assigned to that term in the Security Agreement.

“Governing Documents” shall mean, with respect to any Person, the certificate or articles of incorporation, certificate of formation, by-laws, limited liability company operating agreement or other organizational documents of such Person.

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“Governmental Authority” shall mean any foreign, federal, state, local, or other governmental or administrative body, instrumentality, department, or agency or any court, tribunal, administrative hearing body, arbitration panel, commission, or other similar dispute-resolving panel or body.

“Guarantee” shall mean the Guarantee substantially in the form of Exhibit C.

“Guarantors” shall mean collectively, all Persons (including, without limitation, any of the Company’s Subsidiaries other than its Foreign Subsidiaries) from time to time executing a Guarantee or similar agreement in favor of Purchaser after the Closing Date; sometimes referred to individually as a “Guarantor”.

“Hazardous Materials” shall mean (a) substances that are defined or listed in, or otherwise classified pursuant to, any applicable laws or the regulations thereunder as “hazardous substances,” “hazardous materials,” “hazardous wastes,” “toxic substances,” or any other formulation intended to define, list, or classify substances by reason of deleterious properties such as ignitability, corrosivity, reactivity, carcinogenicity, reproductive toxicity, or “EP toxicity,” (b) oil, petroleum, or petroleum derived substances, natural gas, natural gas liquids, synthetic gas, drilling fluids, produced waters, and other wastes associated with the exploration, development, or production of crude oil, natural gas, or geothermal resources, (c) any flammable substances or explosives or any radioactive materials, and (d) asbestos in any form or electrical equipment that contains any oil or dielectric fluid containing levels of polychlorinated biphenyls in excess of 50 parts per million.

“Hedge Agreements” shall mean all interest rate swaps, caps or collar agreements or similar arrangements entered into by the Company or any of its Subsidiaries providing for protection against fluctuations in interest rates, currency exchange rates or commodity prices, or the exchange of nominal interest obligations, either generally or under specific contingencies.

“Indebtedness” shall mean of any Person at any date, without duplication, (a) all indebtedness of such Person for borrowed money, (b) all obligations of such Person for the deferred purchase price of Property or services (other than trade payables incurred in the ordinary course of such Person’s business), (c) all obligations of such Person evidenced by notes, bonds, debentures or other similar instruments, (d) all indebtedness created or arising under any conditional sale or other title retention agreement with respect to Property acquired by such Person (even though the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such Property), (e) all Capital Lease Obligations or Synthetic Lease Obligations of such Person, (f) all obligations of such Person, contingent or otherwise, as an account party under acceptance, letter of credit or similar facilities, (g) all obligations of such Person, contingent or otherwise, to purchase, redeem, retire or otherwise acquire for value any Equity of such Person, (h) all Contingent Obligations of such Person in respect of obligations of the kind referred to in clauses (a) through (g) above; (i) all obligations of the kind referred to in clauses (a) through (h) above secured by (or for which the holder of such obligation has an existing right, contingent or otherwise, to be secured by) any Lien on Property (including, without limitation, accounts and contract rights) owned by such Person, whether or not such Person has assumed or become liable for the payment of such obligation, (j) all accrued but unpaid obligations of such Person in respect of Hedge Agreements and (k) the redemption value of any preferred Equity of such Person or its Subsidiaries held by

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any Person other than such Person and its wholly-owned Subsidiaries; provided that obligations of the kind referred to in clause (j) shall not be included in “Indebtedness” for the purposes of calculating the financial covenants set forth in Section 9.18.

“Indemnified Liabilities” shall have the meaning assigned to that term in Section 7.1.

“Indemnified Person” shall have the meaning assigned to that term in Section 7.1.

“Initial Exercise Price” shall have the meaning assigned to that term in Section 2.2.

“Insolvency Proceeding” shall mean any proceeding commenced by or against any Person under any provision of the Bankruptcy Code or under any other state or federal bankruptcy or insolvency law, assignments for the benefit of creditors, formal or informal moratoria, compositions, extensions generally with creditors, or proceedings seeking reorganization, arrangement, or other similar relief.

“Intangible Assets” shall mean, with respect to any Person, that portion of the book value of all of such Person’s assets that would be treated as intangibles under GAAP.

“Intellectual Property Security Agreement” shall mean the Intellectual Property Security Agreement to be executed and delivered by each Credit Party, substantially in the form of Exhibit K, as the same may be amended, restated, supplemented, replaced or otherwise modified from time to time in accordance with this Agreement.

“Intercreditor Agreement” shall mean that Subordination and Intercreditor Agreement, dated as of the date hereof, among the Company, the Senior Lender, and the Collateral Agent on behalf of Purchaser, substantially in the form of Exhibit G, as amended, restated, supplemented or modified from time to time in accordance with its terms.

“Inventory” shall have the meaning assigned to that term in the Security Agreement.

“Investment” shall mean (i) any direct or indirect purchase or other acquisition by the Company or any of its Subsidiaries of any beneficial interest in, including stock, partnership interest, membership interest or other Equity of, any other Person (other than a Person that prior to the relevant purchase or acquisition was a wholly-owned domestic Subsidiary of the Company that is a Guarantor) or (ii) any direct or indirect loan, advance or capital contribution by the Company or any of its Subsidiaries to any other Person (other than a wholly-owned domestic Subsidiary of the Company that is a Guarantor), including all Indebtedness and accounts receivable from that other Person that are not current assets or did not arise from sales or the provision of services to that other Person in the ordinary course of business. The amount of any Investment shall be the original cost of such Investment plus the cost of all additions thereto, without any adjustments for increases or decreases in value, or write-ups, write-downs or write-offs with respect to such Investment.

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“Investment Company Act” shall mean the Investment Company Act of 1940, as amended from time to time, and any successor statute thereto.

“Investment Property” shall have the meaning assigned to that term in the Security Agreement.

“Irrevocable Instructions” shall have the meaning assigned to that term in Section 3.28.

“Joinder Agreement” shall mean the Joinder Agreement substantially in the form of Exhibit P.

“Key Employment Agreement” shall mean that certain Employment Agreement, dated as of April 1, 2002, by and between the Company and Robert M. Stemmler.

“Lien” shall mean any interest in an asset securing an obligation owed to, or a claim by, any Person other than the owner of the asset, whether such interest shall be based on the common law, statute, or contract, whether such interest shall be recorded or perfected, and whether such interest shall be contingent upon the occurrence of some future event or events or the existence of some future circumstance or circumstances, including the lien or security interest arising from a mortgage, deed of trust, encumbrance, pledge, hypothecation, assignment, deposit arrangement, security agreement, conditional sale or trust receipt, or from a lease, consignment, or bailment for security purposes and also including reservations, exceptions, encroachments, easements, rights-of-way, covenants, conditions, restrictions, leases, and other title exceptions and encumbrances affecting real property.

“Material Adverse Change” shall mean a material adverse change in or affecting, or a material adverse effect upon (i) any of the transactions contemplated hereby, (ii) the condition (financial or otherwise), results of operation, assets, liabilities, management, prospects or value of the Company and its Subsidiaries, taken as a whole, or the Credit Parties, taken as a whole, or that calls into question in any material respect any of the Projections relating to the Credit Parties and their Subsidiaries which were previously provided to Purchaser or any of the material assumptions on which such Projections were prepared, (iii) the validity or enforceability of any Transaction Document, (iv) the validity, enforceability or priority of the security interests purported to be created hereunder and thereunder, (v) the ability of any Credit Party to perform its obligations under this Agreement or any other Transaction Document, or (vi) the ability of either Purchaser or Collateral Agent to enforce its rights or remedies under this Agreement or any other Transaction Document.

“Multiemployer Plan” shall have the meaning assigned to that term in Section 5.21.

“NASD” shall mean the National Association of Securities Dealers, Inc.

“Negotiable Collateral” means all of the Credit Parties’ now owned and hereafter acquired right, title, and interest with respect to letters of credit, letter of credit rights, instruments, promissory notes, drafts, documents, and chattel paper (including electronic chattel

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paper and tangible chattel paper), and any and all supporting obligations in respect thereof (as such terms are defined in the UCC).

“Note” shall mean the senior subordinated secured promissory note referred to in the first recital hereof, which note is substantially in the form attached hereto as Exhibit A.

“Obligations” shall mean all loans evidenced by the Note and all advances, debts, principal, interest (including any interest that, but for the provisions of the Bankruptcy Code, would have accrued), premiums, liabilities, obligations, fees, charges, costs, Purchaser’s Expenses (including any fees or expenses that, but for the provisions of the Bankruptcy Code, would have accrued), lease payments, guaranties, covenants, and duties of any kind and description owing by any of the Credit Parties to Purchaser pursuant to, in connection with, or evidenced by, the Transaction Documents and irrespective of whether for the payment of money or otherwise, whether direct or indirect, absolute or contingent, due or to become due, now existing or hereafter arising, and including all interest not paid when due, obligations under this Agreement or the Warrant and all Purchaser’s Expenses that any Credit Party is required to pay or reimburse under the Transaction Documents, by law, or otherwise. Any reference in this Agreement or in the Transaction Documents to the Obligations shall include all amendments, changes, extensions, modifications, renewals replacements, substitutions, and supplements, thereto and thereof, as applicable, both prior and subsequent to any Insolvency Proceeding.

“Optional Redemption Price” shall have the meaning assigned to that term in Section 11.1.

“PBGC” shall mean the Pension Benefit Guaranty Corporation (as defined in Title IV of ERISA).

“Permitted Acquisition” shall mean the BRC Transaction, the purchase of an additional one percent (1%) of Equity of BRC by the Company, and any other transaction for which the Company has obtained the prior written consent of Purchaser, which consent shall not unreasonably be withheld; provided, that, in no event, shall Purchaser be required to consent to any amendment to any Transaction Document (other than execution and delivery of a Joinder Agreement and such other non-material amendments as may reasonably be required to cause parties to such transaction, other than a Credit Party, to be bound to the terms of the Transaction Documents) in connection with a Permitted Acquisition, which consent it may withhold in its sole discretion.

“Permitted Dispositions” shall mean any (a) sale or other disposition by any Credit Party of any Equipment that is obsolete or worn out in the ordinary course of business, (b) sale by any Credit Party of Inventory to buyers in the ordinary course of business, (c) licensing by any Credit Party, on a non-exclusive basis, of Proprietary Rights in the ordinary course of business consistent with past practice or (d) disposition of assets, liquidation or winding up of any Foreign Subsidiary in connection with the termination of a line of business by such Foreign Subsidiary with the prior written consent of Purchaser, which consent shall not be unreasonably withheld.

“Permitted Investments” shall mean (a) investments in Cash Equivalents, (b) investments in negotiable instruments for collection, (c) advances made in connection with

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purchases of goods or services in the ordinary course of business, (d) the BRC Transaction, (e) the purchase of an additional one percent (1%) of the Equity of BRC by the Company, and (f) investments by any Credit Party in any other Credit Party that is a wholly-owned Subsidiary of the Company; provided, that if any such investment is in the form of Indebtedness, prior to the incurrence thereof such Indebtedness investment shall be subordinated in right of payment to the prior payment in full of the Obligations in a manner satisfactory to Purchaser, in their sole discretion; provided, further that, in any event, any such Indebtedness investment shall be subordinated in right of payment to the Obligations under the Transaction Documents at least to the same extent that the Note is subordinated to the Senior Debt (as defined in the Intercreditor Agreement) pursuant to the Intercreditor Agreement.

“Permitted Liens” shall have the meaning assigned to that term in Section 9.2.

“Permitted Protest” shall mean the right of the Company or any of its Subsidiaries, as applicable, to protest any Lien (other than any such Lien that secures the Obligations), Taxes (other than payroll Taxes or Taxes that are the subject of a United States federal Tax lien), or rental payment; provided that (a) a reserve with respect to such obligation is established on the Books in such amount as is required under GAAP, (b) any such protest is instituted promptly and prosecuted diligently by the Company or any of its Subsidiaries, as applicable, in good faith, and (c) Purchaser are satisfied that, while any such protest is pending, there will be no impairment of the enforceability, validity, perfection or priority of any of Purchaser’s Liens.

“Permitted Purchase Money Indebtedness” shall mean, as of any date of determination, Purchase Money Indebtedness incurred after the Closing Date in an aggregate amount outstanding at any one time not in excess of $1,000,000.

“Persons” shall mean any natural person, corporation, limited liability company, limited partnership, general partnerships, limited liability partnerships, joint ventures, trusts, land trusts, business trusts, or other organizations, irrespective of whether they are legal entities, and governments and agencies and political subdivisions thereof.

“Preliminary Proxy” shall have the meaning assigned to that term in Section 8.22.

“Pro Forma Balance Sheet” shall mean the pro forma consolidated balance sheet of the Company and its Subsidiaries delivered pursuant to Section 3.11, a copy of which is attached as Schedule 3.11.

“Projections” shall mean any and all forecasted (a) balance sheets, (b) profit and loss statements, (c) cash flow statements and (d) other projections, in each case relating to the Company or any other Credit Party prepared by or on behalf of any Credit Party, copies of which are attached hereto as Exhibit N).

“Property” shall mean any right or interest in or to property of any kind whatsoever, whether real, personal or mixed and whether tangible or intangible, including, without limitation, Equipment, Proprietary Rights and Equity.

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“Proposal Letter” shall mean that certain Proposal Letter, dated as of April 1, 2003, between the Company and Bison Capital, as amended, restated, modified or otherwise supplemented from time to time.

“Proprietary Rights” of any Person shall mean all of such Person’s now owned and hereafter arising or acquired: licenses, franchises, permits, patents, patent rights, copyrights, works which are the subject matter of copyrights, trademarks, service marks, trade names, trade styles, patent applications, trademark applications, service mark applications, and all licenses and rights related to any of the foregoing, and all other rights under any of the foregoing, all extensions, renewals, reissues, divisions, continuations, and continuations-in-part of any of the foregoing, and all rights to sue for past, present and future infringement of any of the foregoing.

“Purchase Money Indebtedness” means Indebtedness (other than the Obligations, but including Capital Lease Obligations), incurred at the time of, or within twenty (20) days after, the acquisition of any Equipment for the purpose of financing all or any part of, but no more than, the acquisition cost thereof.

“Purchaser” shall have the meaning set forth in the first paragraph of this Agreement.

“Purchaser’s BRC Nominee” shall have the meaning set forth in Section 10.2(q).

“Purchaser’s Expenses” shall mean any and all costs and expenses incurred by or on behalf of the Collateral Agent or Purchaser pursuant to, in respect of or otherwise in connection with the transactions contemplated by this Agreement including, without limitation, all (a) costs or expenses (including Taxes and insurance premiums) required to be paid by a Credit Party under any of the Transaction Documents that are paid or incurred by or on behalf of Purchaser, (b) fees or charges paid or incurred by Purchaser in connection with Purchaser’s transactions with the Credit Parties, including attorneys’ fees and expenses, fees or charges for photocopying, notarization, couriers and messengers, telecommunication, public record searches (including Tax lien, litigation, and UCC searches and including searches with the patent and trademark office, the copyright office, or the department of motor vehicles), filing, recording, publication, appraisal (including periodic Collateral appraisals or business valuations to the extent of the fees and charges (and up to the amount of any limitation contained in this Agreement), and environmental audits, (c) costs and expenses incurred by Purchaser in the disbursement of funds to or for the account of the Credit Parties (by wire transfer or otherwise), (d) charges paid or incurred by Purchaser resulting from the dishonor of checks, (e) costs and expenses paid or incurred by or on behalf of Purchaser to correct any default or enforce any provision of the Transaction Documents, or in gaining possession of, maintaining, handling, preserving, storing, shipping, selling, preparing for sale, or advertising to sell the Collateral, or any portion thereof, irrespective of whether a sale is consummated, (f) audit or consulting fees and expenses of Purchaser, (g) costs and expenses of third party claims or any other suit paid or incurred by or on behalf of Purchaser in enforcing or defending the Transaction Documents or in connection with the transactions contemplated by the Transaction Documents or Purchaser’s relationship with any Credit Party or any guarantor of the Obligations, (h) Purchaser’s reasonable fees and expenses (including attorneys’ fees) incurred in connection with advising, structuring, drafting, reviewing or administering, the Transaction Documents, and (i) fees and expenses incurred by Purchaser (including attorneys’ fees) incurred in amending the Transaction

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Documents or in terminating, enforcing (including attorneys’ fees and expenses incurred in connection with a “workout,” a “restructuring,” or an Insolvency Proceeding concerning any Credit Party or in exercising rights or remedies under the Transaction Documents), or defending the Transaction Documents, irrespective of whether suit is brought, or in taking any Remedial Action concerning the Collateral. Notwithstanding the foregoing, Purchaser’s Expenses that are to be reimbursed by the Credit Parties herewith and that were incurred by Purchaser in connection with the closing of the transactions on the Closing Date contemplated by this Agreement shall not exceed $280,000, in the aggregate, less amounts previously paid to Purchaser for such closing expenses.

“Purchaser Nominee” shall have the meaning assigned to that term in Section 10.2(p).

“Purchaser Representative” shall have the meaning assigned to that term in Section 8.15.

“Quantum” shall mean Quantum Fuel Systems Technologies Worldwide, Inc.

“Quantum Strategic Alliance Agreement” shall mean that certain Strategic Alliance Agreement dated as of July 23, 2002, by and between the Company and Quantum, as amended from time to time.

“RCRA” has the meaning set forth in the definition of “Environmental Laws”.

“Record” means information that is inscribed on a tangible medium or which is stored in an electronic or other medium and is retrievable in perceivable form.

“Registration Rights Agreement” shall mean the Registration Rights Agreement substantially in the form attached hereto as Exhibit E.

“Regulation T” shall mean Regulation T of the Federal Reserve Board as in effect from time to time (and any successor to all or a portion thereof).

“Regulation U” shall mean Regulation U of the Federal Reserve Board as in effect from time to time (and any successor to all or a portion thereof).

“Regulation X” shall mean Regulation X of the Federal Reserve Board as in effect from time to time (and any successor to all or a portion thereof).

“Remedial Action” means all actions taken to (a) clean up, remove, remediate, contain, treat, monitor, assess, evaluate, or in any way address Hazardous Materials in the indoor or outdoor environment, (b) prevent or minimize a release or threatened release of Hazardous Materials so they do not migrate or endanger or threaten to endanger public health or welfare or the indoor or outdoor environment, (c) perform any pre-remedial studies, investigations, or post-remedial operation and maintenance activities, or (d) conduct any other actions authorized by 42 USC § 9601.

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“Representatives” shall mean, as to any Person, such Person’s directors, officers, partners, employees, agents or representatives (including attorney, accountants and financial advisors).

“Requirements of Law” shall mean as to any Person, provisions of the Governing Documents or other organizational or governing documents of such Person, or any law, treaty, policy, code, rule, regulation, right, privilege, qualification, license or franchise or determination of an arbitrator or a court or other Governmental Authority, in each case applicable or binding upon such Person or any of such Person’s property or to which such Person or any of such Person’s property is subject or pertaining to any or all of the transactions contemplated or referred to herein.

“Restricted Payment” shall have the meaning assigned to that term in Section 9.9.

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

“SEC Reports” with respect to any Person shall mean all forms, reports, statements and other documents (including exhibits, annexes, supplements and amendments to such documents) filed or required to be filed by it, or sent or made available by it to its security holders, under the Exchange Act, the Securities Act, any national securities exchange or quotation system or comparable Governmental Authority.

“Securities” shall mean, collectively, the Note and the Warrant.

“Securities Account” shall mean a “securities account” as that term is defined in the UCC.

“Securities Act” shall mean the Securities Act of 1933, as amended from time to time, or any similar federal statute, and the rules and regulations thereunder as the same shall be in effect at the time.

“Security Agreement” shall mean that certain Security Agreement, dated as of the date hereof, among the Credit Parties in favor of the Collateral Agent, for the benefit of the Collateral Agent and Purchaser, substantially in the form attached hereto as Exhibit O, as amended, restated, supplemented or modified from time to time in accordance with its terms.

“Security Documents” shall mean the Security Agreement, the Intellectual Property Security Agreement, the Stock Pledge Agreement (and the Acknowledgement and Consents thereto), each Control Agreement, the Deed of Pledge, financing statements and all other pledge and security documents hereafter delivered to the Collateral Agent granting or purporting to grant a Lien on any Property of any Person to secure the obligations and liabilities of any Credit Party under any Transaction Document.

“Senior Credit Agreement” shall mean that certain Loan and Security Agreement, dated as of the date hereof, among the Company, the Senior Lender and certain other lenders from time to time made a party thereto.

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“Senior Credit Documents” shall mean the Senior Credit Agreement and other documents listed in Schedule 3.

“Senior Lender” shall mean LaSalle Business Credit, LLC, in its individual capacity or as Agent under the Senior Credit Agreement, or its successors and assigns.

“Solvency Certificate” shall mean a Solvency Certificate substantially in the form attached hereto as Exhibit H, and signed by the Chief Financial Officer of the Company.

“Solvent” shall mean, with respect to any Person, as of any date of determination, (a) the amount the “present fair saleable value” of the assets of such Person will, as of such date, exceed the amount of all “liabilities of such Person, contingent or otherwise,” as of such date, as such quoted terms are determined in accordance with applicable federal and state laws governing determinations of the insolvency of debtors, (b) the present fair saleable value of the assets of such Person which will, as of such date, be greater than the amount that will be required to pay the liability of such Person on its debts as such debts become absolute and matured, (c) such Person will not have, as of such date, an unreasonably small amount of capital with which to conduct its business, (d) such Person will be able to pay its debts as they mature, and (e) such Person is not insolvent within the meaning of any applicable Requirements of Law. For purposes of this definition, (i) “debt” means liability on a “claim,” and (ii) “claim” means any (x) right to payment, whether or not such a right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured or (y) right to an equitable remedy for breach of performance if such breach gives rise to a right to payment, whether or not such right to an equitable remedy is reduced to judgment, fixed, contingent, matured or unmatured, disputed, undisputed, secured or unsecured.

“Stated Principal Amount” shall mean, with respect to the Note, the stated principal amount at the final maturity of the Note, as set forth in Schedule 1.

“Stock Pledge Agreement” shall mean the Pledge Agreement, substantially in the form attached hereto as Exhibit L, executed and delivered by the Credit Parties, as the same may be amended, restated, supplemented or modified from time to time in accordance with its terms.

“Stockholder Proposal” shall have the meaning assigned to that term in Section 8.22.

“Strategic Consulting Agreement” shall mean that certain Strategic Consulting Agreement, dated as of the date hereof, by and between the Company and Bison Capital Asset Management, LLC, as amended, restated, supplemented or modified from time to time in accordance with its terms.

“Subsidiary” of a Person means a corporation, partnership, limited liability company, or other entity in which that Person directly or indirectly owns or controls the shares or units of Equity having ordinary voting power to elect a majority of the board of directors (or appoint other comparable managers) of such corporation, partnership, limited liability company, or other entity.

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“Supporting Obligations” means all supporting obligations as such term is defined in the UCC.

“Synthetic Lease Obligations” shall mean all monetary obligations of a Person under (a) a so-called synthetic, off-balance sheet or Tax retention lease, or (b) an agreement for the use or possession of property creating obligations which do not appear on the balance sheet of such Person but which, upon the insolvency or bankruptcy of such Person, would be characterized as the Indebtedness of such Person (without regard to accounting treatment).

“Tax” or “Taxes” shall mean any federal, state, local or foreign income, gross receipts, license, payroll, employment, excise, severance, stamp, occupation, premium, windfall profits, environmental, customs duties, capital stock, franchise, profits, withholding, social security, unemployment, disability, real property, personal property, sales, use, transfer, registration, value added, alternative or add-on minimum, estimated, or other tax of any kind whatsoever, including any interest, penalty, or addition thereto, whether disputed or not.

“Tax Return” shall mean any return, declaration, report, claim for refund, or information return or statement relating to Taxes, including any schedule or attachment thereto, and including any amendment thereof.

“Termination Event” shall mean (i) any Credit Party, any Benefit Plan or any fiduciary (within the meaning of Section 3(21) of ERISA) of a Benefit Plan being named as a defendant in a lawsuit filed under ERISA or the assertion of a material claim (other than routine claims for benefits) against any Benefit Plan or the assets thereof, or against any Credit Party or any of its ERISA Affiliates in connection with any Benefit Plan; (ii) the Internal Revenue Service giving notice that it intends to revoke the Tax-qualified status of any Benefit Plan; (iii) the occurrence of a “Reportable Event” described in Section 4043 of ERISA with respect to a Benefit Plan, regardless of whether the PBGC has waived the notice requirements with respect to such event in its regulations; (iv) the imposition, or notice of imposition, of liability (whether absolute or contingent) on any Credit Party or any of its ERISA Affiliates as a result of a complete or partial withdrawal from a Multiemployer Plan; (v) the receipt of a notice to terminate a Benefit Plan in a distress termination under Section 4041(c) of ERISA or to appoint a trustee to administer a Benefit Plan; (vi) the institution of proceedings by the PBGC to terminate a Benefit Plan or to appoint a trustee pursuant to Section 4042 of ERISA, or the occurrence of any event or set of circumstances that might reasonably constitute grounds for the PBGC to do either; (vii) the restoration of a Benefit Plan by the PBGC pursuant to Section 4047 of ERISA; (viii) any Credit Party’s withdrawal from a single-employer plan during the plan year in which it is a substantial employer pursuant to Section 4063 of ERISA; (ix) the existence with respect to any Benefit Plan of an “accumulated funding deficiency” (as defined in Section 412 of the Code or Section 302 of ERISA), whether or not waived, the failure to make by its due date a required installment under Section 412(m) of the Code with respect to any Benefit Plan or the failure by any Credit Party or any of its ERISA Affiliates to make any required contribution to a Multiemployer Plan; (x) the filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an application for a waiver of the minimum funding standard with respect to any Benefit Plan; (xi) the incurrence by any Credit Party or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to the termination of any Benefit Plan; (xii) a determination that a Multiemployer Plan in which any Credit Party or any of its ERISA Affiliates participates or has participated is, or is expected to be, insolvent or in reorganization,

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within the meaning of Title IV of ERISA; (xiii) the making of any amendment to any Benefit Plan that could result in the imposition of a lien or the posting of a bond or other security; and (xiv) the occurrence of a nonexempt prohibited transaction (within the meaning of Section 4975 of the Tax Code or Section 406 of ERISA) that could result in liability to any Credit Party; or (xv) the imposition of a lien pursuant to Section 401(a)(29) or 412(n) of the Code or pursuant to ERISA with respect to any Benefit Plan.

“Transaction Documents” shall mean, collectively, this Agreement, the Note, the Warrant, the Warrant Agreement, the Registration Rights Agreement, the Guarantees, the Intercreditor Agreement, the Solvency Certificate, the Compliance Certificate, the Security Documents, the Strategic Consulting Agreement, the Fee Letter, the BRC Consent and Assignment and other documents, certificates or instruments entered into by any Credit Party in connection herewith or therewith.

“Transfer Taxes” shall mean all transfer, documentary, sales, use, stamp, registration and other such Taxes and fees (including any penalties and interest).

“Treasury Regulations” shall mean the Treasury regulations promulgated under the Code.

“UCC” means the Uniform Commercial Code, as in effect from time to time, of the State of New York or of any other state the laws of which are required as a result thereof to be applied in connection with the issue of perfection of security interests.

“Unconsolidated Affiliate” shall mean any Affiliate of any Credit Party which would not be consolidated with such Credit Party in the consolidated financial statements of such Credit Party in accordance with GAAP, including, but not limited to, MINDA IMPCO Technologies, Ltd., MINDA IMPCO Ltd. and CNGC-IMPCO Technologies, LLC.

“Warrant” shall mean the warrant referred to in the first recital hereof, which warrant is substantially in the form attached to the Warrant Agreement as Annex I thereto.

“Warrant Agreement” shall mean the Common Stock Warrant Agreement between the Company and Purchaser substantially in the form attached hereto as Exhibit B.

“Warrant Securities” shall have the meaning assigned to that term in the recitals hereto.

1.2 Accounting Terms. All accounting terms not specifically defined herein shall be construed in accordance with GAAP. When used herein, the term “financial statements” shall include the notes and schedules thereto. Whenever the term “Company” is used in respect of a financial covenant or a related definition, it shall be understood to mean the Company and its Subsidiaries on a consolidated basis unless the context clearly requires otherwise. Unless otherwise expressly provided herein, financial calculations made herein shall be in accordance with GAAP.

1.3 Other Definitional Provisions.

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(a) The words “including” and “includes” and words of similar import when used in this Agreement shall not be limiting and shall mean “including without limitation” or “includes without limitation”, as the case may be.

(b) Unless expressly provided otherwise, any approval or consent required to be given by the Collateral Agent or Purchaser in this Agreement shall be given or withheld by the Collateral Agent or Purchaser in their sole discretion.

ARTICLE 2

PURCHASE AND SALE OF THE SECURITIES

2.1 Purchase and Sale of the Note. Subject to the terms and conditions herein set forth, the Company agrees that it will issue and sell to Bison Capital, and Bison Capital agrees that it will acquire from the Company on the Closing Date, the Note substantially in the form attached hereto as Exhibit A, appropriately completed in conformity herewith.

2.2 Purchase and Sale of the Warrant. Subject to the terms and conditions herein set forth, the Company agrees that it will issue and sell to Bison Capital, and Bison Capital agrees that it will acquire from the Company on the Closing Date, a warrant to purchase 500,000 shares of Common Stock pursuant to the Warrant Agreement at an initial per-share exercise price of $2.00 (“Initial Exercise Price”); provided, however, that if the Company shall receive notice from the Nasdaq Stock Market or its Affiliates, or an opinion of its counsel, that stockholder approval is required under NASD Rule 4350(i)(1)(D) for the issuance of the Warrant, the Initial Exercise Price shall be adjusted so that the Initial Exercise Price shall be $6.08 and such price shall be deemed to have been applicable at all times from and after the Closing Date, except that such adjusted Initial Exercise Price shall not apply to any portion of the Warrant that has already been exercised prior to the adjustment. If the Initial Exercise Price shall be adjusted in accordance with the foregoing sentence, and such adjustment triggers a charge to the Company’s earnings in accordance with GAAP, then Bison Capital and the Company shall mutually determine an appropriate mechanism to amend the covenants set forth in Section 9.18 such that the charge to earnings shall not give rise to or contribute to an Event of Default hereunder. For the avoidance of doubt, the parties hereto agree that the Initial Exercise Price shall be subject to adjustment as provided in Section 10 of the Warrant Agreement.

2.3 Fees at Closing; Annual Fees. On the Closing Date, the Company shall (a) pay to Bison Capital the fees set forth in the Fee Letter, and (b) pay or reimburse Purchaser for all Purchaser’s Expenses, which payments shall be made, at the option of Purchaser, by wire transfer of immediately available funds to an account or accounts designated by Purchaser or through an offset of the purchase price of the Securities. The Company shall also pay on the Closing Date and on each other date provided in the Fee Letter or the Strategic Consulting Agreement, as applicable, any other fees (including, without limitation, monitoring fees) in accordance with the terms of the Fee Letter or the Strategic Consulting Agreement, as applicable.

2.4 Closing. The purchase and issuance of the Securities shall take place at the closing (the “Closing”) to be held at the offices of Latham & Watkins LLP, 633 West Fifth Street, Suite 4000, Los Angeles, CA 90071 at 7:00 a.m., Los Angeles time, on July 18, 2003 (the “Closing Date”). At the Closing, the Company shall deliver the Note and the Warrant to

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Purchaser against delivery by Purchaser to the Company of the applicable purchase price therefor as set forth on Schedule 1. Payment of such purchase price shall be by wire transfer in immediately available funds to an account or accounts designated by the Company; provided, however, that an amount equal to $7,000,000 shall be paid by wire transfer of immediately available funds to an account designated by the Company for the benefit of the BRC Shareholders in respect of the Deferred Portion of the Purchase Price (as such term is defined in the BRC Sale and Purchase Agreement) to be paid in connection with the BRC Transaction.

2.5 Financial Accounting Positions; Tax Reporting. Each of the parties hereto agrees to take reporting and other positions with respect to the Securities that are consistent with the purchase price of the Securities set forth herein for all financial accounting purposes, unless otherwise required by GAAP or applicable SEC rules (in which case the parties agree only to take positions inconsistent with the purchase price of the Securities set forth herein; provided, that Purchaser has consented thereto, which consent shall not be unreasonably withheld). Each of the parties to this Agreement agrees to take reporting and other positions with respect to the Securities that are consistent with the purchase price of the Securities set forth herein for all other purposes, including without limitation, for all federal, state and local Tax purposes.

2.6 Default Rate of Interest. Notwithstanding the provisions of the Note, and in addition to the interest provided for in Section 10.2(r), but subject to applicable law, (i) any overdue principal of and overdue interest on the Note shall bear interest, payable on demand in immediately available funds, for each day from the date payment thereof was due to the date of actual payment, at a rate equal to the rate of interest otherwise in effect pursuant to the first sentence of Section 1(a) of the Note plus three percent (3.0%) per annum, (ii) any interest payable on demand during the continuance of an Event of Default pursuant to Section 1 of the Note shall bear interest, payable on demand in immediately available funds, for each day from the occurrence of such Event of Default to the date of actual payment thereof, at a rate equal to the rate of interest otherwise in effect pursuant to the first sentence of Section 1(a) of the Note plus three percent (3.0%) per annum, and (iii) upon and during the occurrence of any Event of Default, the Note shall bear interest, from the date of the occurrence of such Event of Default until such Event of Default is cured or waived, payable on demand in immediately available funds, or, in kind, at the holder’s sole option, at a rate equal to the rate of interest otherwise in effect pursuant to the first sentence of Section 1(a) of the Note plus three percent (3.0%) per annum; provided that any interest payable under the Note (whether or not at a default rate of interest) or as provided in this Agreement (including, without limitation, Section 2.6 and Section 10.2(r) hereof) shall be capitalized and added to the principal of the Note to the extent such interest is not payable pursuant to the Intercreditor Agreement. Subject to applicable law, any interest that shall accrue on overdue interest on the Note as provided in the preceding sentence and shall not have been paid in full in immediately available funds on or before the next Interest Payment Date (as defined in the Note) to occur after the Interest Payment Date on which the overdue interest became due and payable shall itself be deemed to be overdue interest on the Note to which the preceding sentence shall apply.

2.7 Monthly Interest Statement. Purchaser will use commercially reasonable efforts to provide the Company a monthly interest statement setting forth the interest due and payable on the Note for each month. Unless the Company objects in writing to the

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amount of interest set forth in a monthly interest statement within five (5) days after Purchaser provides such monthly interest statement, such amount shall be deemed to be the correct amount of interest due and payable for such month. Failure by Purchaser to provide a monthly interest statement shall not be deemed a breach under this Agreement and shall not affect the obligation of the Company to pay interest.

ARTICLE 3

CONDITIONS TO THE OBLIGATIONS OF

PURCHASER TO PURCHASE THE SECURITIES

The obligation of Purchaser to purchase the Securities, to pay the purchase prices therefor on the Closing Date, and to perform any obligations hereunder shall be subject to the satisfaction as determined by, Purchaser or Purchaser’s waiver thereof of the following conditions on or before the Closing Date; provided, however, that any waiver of a condition shall not be deemed a waiver of any breach of any representation, warranty, agreement, term or covenant or of any misrepresentation by the Company or any other Credit Party.

3.1 Representations and Warranties. The representations and warranties of the Credit Parties contained in Article 5 hereof and in paragraph 13 of the Senior Credit Agreement shall be true and correct at and as of the Closing Date, and Purchaser shall have received at the Closing a certificate to the foregoing effect, dated the Closing Date, and executed by the Chief Executive Officer of each Credit Party on behalf of such Credit Party.

3.2 Compliance with this Agreement. The Credit Parties shall have performed and complied with all of their respective agreements and conditions set forth or contemplated herein that are required to be performed or complied with by the Credit Parties on or before the Closing Date and Purchaser shall have received at the Closing a certificate to the foregoing effect, dated the Closing Date, and executed by the Chief Executive Officer of each Credit Party on behalf of such Credit Party.

3.3 Secretary’s Certificates; Good Standing Certificates. Purchaser shall have received the following from or with respect to each Credit Party:

(a) a certificate, dated the Closing Date and signed by the Secretary of such Credit Party, certifying (i) that the attached copies of the Governing Documents of such Credit Party, and resolutions of the members or Board of Directors of such Credit Party approving the Transaction Documents to which it is a party and the transactions contemplated hereby and thereby are all true, complete and correct and remain unamended and in full force and effect, and (ii) the incumbency and specimen signature of each officer of such Credit Party executing any Transaction Document to which it is a party or any other document delivered in connection herewith and therewith on behalf of such Credit Party;

(b) with respect to the Company, a copy of a certificate of the Secretary of State or other applicable Governmental Authority of the jurisdiction in which the Company is organized, dated reasonably near the Closing Date, listing the Governing Documents of the Company and each amendment thereto on file in such office and certifying that (i) such amendments are the only amendments to the Company’s Governing Documents on file in such

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office, (ii) the Company has paid all franchise Taxes to the date of such certificate and (iii) the Company is duly organized and in good standing under the laws of such jurisdiction;

(c) a copy of a certificate of the Secretary of State or other applicable Governmental Authority of the jurisdiction in which each such Person is organized, dated reasonably near the Closing Date, attesting to the due organization, valid existence and good standing of such Credit Party therein; and

(d) a telephonic confirmation from the Secretary of State or other applicable Governmental Authority of each jurisdiction in which the Company is organized certifying that the Company is duly organized and in good standing under the laws of such jurisdiction on the Closing Date, together with a written confirmatory report in respect thereof prepared by, or on behalf of, a filing service acceptable to Purchaser; and

(e) a copy of a certificate of the Secretary of State or other applicable Governmental Authority of each jurisdiction in which such Credit Party is required to be qualified as a foreign corporation or entity, dated reasonably near the Closing Date, stating that such Credit Party is duly qualified and in good standing as a foreign corporation or entity in each such jurisdiction and has filed all annual reports required to be filed to the date of such certificate; and telephonic confirmation from the Secretary of State or other applicable Governmental Authority of each such jurisdiction on the Closing Date as to the due qualification and continued good standing of each such Credit Party as a foreign corporation or entity in each such jurisdiction on or about the Closing Date, together with a written confirmatory report in respect thereof prepared by, or on behalf of, a filing service acceptable to Purchaser.

3.4 Documents. Purchaser shall have received true, complete and correct copies of (a) the SEC Reports of the Company (delivery of which shall be deemed to have occurred if either delivered as paper copies to Purchaser or filed with the SEC in electronic form), (b) the most recent financial statements of the Company and its Subsidiaries, including the financial statements for the fiscal years ending on April 30, 2001, April 30, 2002 and December 31, 2002, respectively, copies of which are attached hereto as Exhibit Q, (c) the results of a recent lien, tax lien, judgment and litigation search in each of the jurisdictions or offices (including, without limitation, in the United States Patent and Trademark Office and the United States Copyright Office in which Uniform Commercial Code financing statements or other filings or recordations should be made to evidence or perfect (with the priority required under the Transaction Documents) security interests in all Collateral of the Credit Parties, and such search shall reveal no Liens on any of the assets of any Credit Party except for Permitted Liens, (d) certificates of liability insurance with respect to the insurance policies required to be maintained by the Credit Parties as of the Closing Date pursuant to Section 8.7, together with additional insured and lender’s loss payee endorsements in favor of Purchaser, (e) such agreements, schedules, exhibits, certificates, documents, financial information and filings as Purchaser may reasonably request in connection with or relating to the transactions contemplated hereby, all in form and substance satisfactory to Purchaser, certified by the Chief Executive Officer or the President of the Company as true, correct and complete copies thereof, (f) any Tax examination reports and statements of deficiencies assessed against or agreed to by the Company or its predecessor since January 1, 2000, and (g) copies of the resolutions of the Board of Directors of the Company approving the transactions identified on Schedule 9.12.

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3.5 Purchase of Securities Permitted by Applicable Laws. The acquisition of and payment for the Securities to be acquired by Purchaser hereunder and the consummation of the transactions contemplated hereby and by the Transaction Documents

(a) shall not be prohibited by any Requirement of Law,

(b) shall not subject Purchaser to any onerous condition or any penalty under or pursuant to any Requirement of Law or require the registration (other than under the Registration Rights Agreement) or qualification of any such Securities under any applicable federal or state securities laws, and

(c) shall be permitted by all Requirements of Law to which Purchaser or the transactions contemplated by or referred to herein or in the Transaction Documents are subject; and Purchaser shall have received such certificates or other evidence in form and substance satisfactory to it as it may reasonably request to establish compliance with this condition.

3.6 Opinions of Counsel. Purchaser shall have received opinions of U.S. and Italian counsel to the Credit Parties reasonably satisfactory to Purchaser, dated as of the Closing Date, relating to the transactions contemplated by or referred to herein, in the form attached hereto as Exhibits I-1 and I-2.

3.7 Approval of Counsel to Bison Capital. All actions and proceedings hereunder and all agreements, schedules, exhibits, certificates, financial information, filings and other documents required to be delivered by each of the Credit Parties hereunder or under any other Transaction Document or in connection with the consummation of the transactions contemplated hereby or thereby, and all other related matters (including, without limitation, the opinion of counsel referred to in Section 3.6 hereof), shall have been in form and substance acceptable to Latham & Watkins LLP, counsel to Purchaser, in its reasonable judgment.

3.8 Consents and Approvals. All consents, exemptions, authorizations, or other actions by, or notices to, or filings with, Governmental Authorities and other Persons (including, without limitation, any consents required pursuant to the Senior Credit Agreement) in respect of all Requirements of Law, the Company and each of the other Credit Parties necessary or desirable in connection with the execution, delivery or performance (including, without limitation, the payment of interest on the Note and the issuance of Equity of the Company upon the exercise of the Warrant) by any Credit Party, or enforcement against any Credit Party, of the Transaction Documents to which it is a party shall have been obtained and be in full force and effect, and Purchaser shall have been furnished with appropriate evidence thereof, and all waiting periods shall have lapsed without extension or the imposition of any conditions or restrictions.

3.9 Transaction Documents. The Company shall have duly executed and delivered, and shall cause each other Credit Party and each Affiliate thereof, to duly execute and deliver the Transaction Documents to which such Person is party.

3.10 No Material Judgment or Order. There shall not be on the Closing Date any judgment or order of a court of competent jurisdiction or any ruling of any Governmental

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Authority or any condition imposed under any Requirement of Law which, in the reasonable judgment of Purchaser, would prohibit the purchase of the Securities hereunder or subject Purchaser to any onerous condition or any penalty under or pursuant to any Requirement of Law if the Securities were to be purchased hereunder.

3.11 Pro Forma Balance Sheets. The Company shall have delivered to Purchaser as of the Closing Date (a) a pro forma consolidated balance sheet of the Company and its Subsidiaries (including its Foreign Subsidiaries), (b) a pro forma consolidated balance sheet of the Company and its Subsidiaries (excluding its Foreign Subsidiaries), each in form and substance satisfactory to Purchaser and certified by the Chief Financial Officer of the Company that it fairly presents the pro forma adjustments reflecting the consummation of the transactions contemplated by the Transaction Documents, including all fees and expenses in connection therewith, (c) a pro forma consolidated balance sheet of the Company and its Subsidiaries in form and substance reasonably satisfactory to Purchaser and certified by the Chief Financial Officer of the Company that it fairly presents the pro forma adjustments reflecting the consummation of the transactions contemplated by the BRC Agreements and the BRC Transaction, including all fees and expenses in connection therewith and (d) a pro forma consolidated balance sheet of BRC and its Subsidiaries in form and substance reasonably satisfactory to Purchaser and certified by the principal financial officer of BRC that it fairly presents the pro forma adjustments contemplated by the BRC Agreements and the BRC Transaction, including all fees and expenses in connection therewith. A copy of each of the aforementioned pro forma balance sheets is attached hereto as Schedule 3.11.

3.12 Certificates. The Company shall have delivered to Purchaser as of the Closing Date (a) a Compliance Certificate and (b) a Solvency Certificate executed by the Chief Financial Officer of each Credit Party which shall document the solvency of each Credit Party after giving effect to the transactions contemplated hereby.

3.13 No Litigation. No action, suit or proceeding before any court or any Governmental Authority shall have been commenced or threatened, no investigation by any Governmental Authority shall have been commenced and no action, suit or proceeding by any Governmental Authority shall have been threatened against Purchaser, the Company, any Subsidiary of the Company or any other Credit Party (i) seeking to restrain, prevent or change the transactions contemplated hereby or questioning the validity or legality of any of such transactions, or (ii) which could reasonably be expected to result in a Material Adverse Change.

3.14 No Event of Default. No Default or Event of Default shall have occurred and be continuing, other than under the BOFA Credit Agreement.

3.15 Closing Fees. Bison Capital shall have received all fees required to be paid pursuant to the Fee Letter and Purchaser and the Collateral Agent shall have received all applicable Purchaser’s Expenses, on or before the Closing Date. All such amounts will be paid with proceeds from the sale of the Securities received on the Closing Date and will be reflected in the funding instructions given by the Credit Parties to Purchaser and the Collateral Agent on or before the Closing Date.

3.16 Repayment of Existing Credit Facilities; Senior Credit Agreement. Purchaser shall have received evidence satisfactory to Purchaser of the repayment of

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$11,338,215.25 under the BOFA Credit Agreement, as further set forth in Schedule 5.18, and arrangements satisfactory to Purchaser shall have been made for the termination of Liens and security interests granted in connection therewith including, without limitation, receipt by Purchaser of satisfactory notices of relinquishment of security interest or the like with respect to Proprietary Rights. Purchaser shall have received evidence satisfactory to Purchaser of the concurrent closing and effectiveness of the Senior Credit Agreement.

3.17 No Material Adverse Change. (a) There shall not have occurred on the Closing Date any event, development or circumstance since December 31, 2002, that has caused or could reasonably be expected to cause a Material Adverse Change; and (b) there shall not have occurred any disruption or adverse change, as determined by Purchaser in its sole discretion, in the financial or capital markets generally, or for subordinated debt or warrants or other equity securities in particular, or affecting the syndication funding of subordinated loans (or the refinancing thereof) that may have an adverse impact on the ability of Purchaser (or any of its respective assigns) to sell or place the Note or the Warrant.

3.18 Pledged Collateral. Subject to the provisions of the Intercreditor Agreement, the Collateral Agent shall have received, and shall hold, for the benefit of Purchaser, (i) the certificates representing the shares of stock pledged pursuant to the Transaction Documents, respectively, together with an undated stock power for each such certificate executed in blank by a duly authorized officer of the pledgor thereof, (ii) each promissory note pledged to Purchaser pursuant to the Transaction Documents endorsed (without recourse) in blank (or accompanied by an executed transfer form in blank satisfactory to the Collateral Agent) by the pledgor thereof, (iii) an Acknowledgement and Consent and (iv) subject to Section 9.11 and the Intercreditor Agreement, the Control Agreements for each Credit Party’s deposit accounts or Securities Accounts.

3.19 Filings, Registrations and Recordings. Each document (including, without limitation, any Uniform Commercial Code financing statement) required by the Transaction Documents or under law or reasonably requested by Purchaser to be filed, registered or recorded in order to create in favor of the Collateral Agent and Purchaser, a perfected Lien on, and security interest in, the Collateral described therein, prior and superior in right to any other Person (other than Permitted Liens), shall have been duly filed, registered or recorded, as applicable.

3.20 Business Plan. Purchaser shall have received a satisfactory business plan for fiscal years 2003—2007 and a satisfactory written analysis of the business and prospects of the Company, its Subsidiaries, BRC, the Unconsolidated Affiliates and the other Credit Parties for the period from the Closing Date through 2007.

3.21 Budget. Purchaser shall have received a budget for the Company, its Subsidiaries and the other Credit Parties for the 2003 fiscal year.

3.22 Minimum Liquidity. After giving effect to the consummation of the transactions contemplated hereunder and under the Senior Credit Agreement on the Closing Date (assuming that advances thereunder have been drawn to the maximum amount permitted under paragraph 2(a) of the Senior Credit Agreement as of the Closing Date), the payment of all costs, fees and expenses relating hereto and thereto, the operation of its business in the ordinary course

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of business and the timely payments of amounts owing to its vendors, the Company shall have on hand not less than $1,000,000 in cash and Cash Equivalents and shall have sufficient liquidity to satisfy all of its obligations associated with the BRC Acquisition. The Company shall have delivered to Purchaser estimates of all of the Credit Parties’ accounts payable and accounts receivable as of the Closing Date, in form and substance satisfactory to Purchaser and calculated in accordance with GAAP, and certified as to their accuracy and completeness by the Chief Financial Officer of the Company.

3.23 Press Release, etc. The Company (a) shall have obtained Purchaser’s consent to the form and substance of each press release with respect to the transactions contemplated by the Transaction Documents to be issued concurrently with or following the Closing Date; and (b) shall have granted to Purchaser a non-exclusive, royalty-free license to use the name and logo of the Company in any marketing or similar material prepared by or on behalf of Purchaser in the ordinary course of business.

3.24 Intercreditor Agreement. The Company shall have delivered to Purchaser the duly executed Intercreditor Agreement.

3.25 Other Obligations. The Company shall have delivered to Purchaser true and correct copies, certified as to authenticity by the Chief Financial Officer of the Company, of (i) the Senior Credit Agreement, (ii) the Existing Notes, (iii) the Quantum Strategic Alliance Agreement, (iv) the BRC Agreements, (v) the Key Employment Agreement, (vi) a consolidated and consolidating balance sheet and income statement covering BRC’s operations for the most recent fiscal quarter, and (vii) the Bridge Loan Subordination Agreements.

3.26 Assignment of the BRC Agreements and the Quantum Strategic Alliance Agreement; Consents. The Company shall have delivered to Purchaser the BRC Consent and Assignment with respect to the collateral assignment to Purchaser of the BRC Agreements and a Collateral Assignment Consent with respect to the collateral assignment to Purchaser of the Quantum Strategic Alliance Agreement.

3.27 Waiver of Joint Company Buy-Out Agreement. The Company shall have delivered a waiver, in form and substance satisfactory to Purchaser, of the Joint Company Buy-Out Agreement, dated January 27, 1999, by and among the Company, IMPCO-BERU Technologies B.V. and BERU Aktiengesellschaft.

3.28 Irrevocable Instructions. The Company shall have delivered to Purchaser a copy of the duly executed Irrevocable Instructions (the “Irrevocable Instructions”) from the Company and the BRC Shareholders to the Fiduciary Company (as defined in the BRC Sale and Purchase Agreement) instructing the Fiduciary Company to release the Quota (as defined in the BRC Sale and Purchase Agreement) directly to Purchaser, in form and substance satisfactory to Purchaser and attached hereto as Exhibit S, and the Irrevocable Instructions shall have been delivered to and accepted by the Fiduciary Company.

3.29 Notarial Deed. The Company shall have delivered to Purchaser a copy of the duly executed notarial deed delivered to the Fiduciary Company (as defined in the BRC Sale and Purchase Agreement) in accordance with the BRC Consent and Assignment in the form of Exhibit D attached thereto.

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ARTICLE 4

CONDITIONS TO THE OBLIGATIONS

OF THE COMPANY TO ISSUE AND SELL THE SECURITIES

The obligations of the Company to sell the Note and the Warrant shall be subject to the satisfaction of the following conditions on or before the Closing Date:

4.1 Representations and Warranties. The representations and warranties of Purchaser contained in Article 6 hereof shall be true and correct at and as of the date hereof and the Closing Date as if made at and as of such date.

4.2 Compliance with this Agreement. Purchaser shall have performed and complied with all of its agreements and conditions set forth or contemplated herein that are required to be performed or complied with by Purchaser on or before the Closing Date.

4.3 Purchase Permitted by Applicable Laws. The consummation of the transactions contemplated by this Agreement shall not be prohibited by any Requirement of Law and shall not subject the Company to any onerous condition (which has caused or could reasonably be expected to cause a Material Adverse Change) or any penalty under or pursuant to any Requirement of Law or require the regulation or qualification of any of the Securities to be acquired hereby under any applicable federal or state securities laws, and shall not be enjoined (temporarily or permanently) under, or prohibited by or contrary to, any injunction, order, decree or ruling. Without limiting the generality of the foregoing, the consummation of the transactions contemplated hereby shall be permitted by all applicable requirements of federal and state securities laws.

4.4 Payment for Securities. Purchaser shall have delivered to the Company the purchase price required to be paid as set forth in Schedule 1, less the amounts provided for in Section 2.3.

ARTICLE 5

REPRESENTATIONS AND WARRANTIES OF THE CREDIT PARTIES

Each Credit Party, jointly and severally, makes the following representations and warranties to Purchaser which representations and warranties shall survive the execution and delivery of this Agreement:

5.1 No Encumbrances. Each Credit Party has good and indefeasible title to its Collateral and its real property, free and clear of any Liens except for Permitted Liens.

5.2 Equipment. All of the Equipment is used or held for use in the Credit Parties’ business and is, in the reasonable judgment of the Company, fit for such purposes.

5.3 Location of Collateral; Chief Executive Office; FEIN. The location of the Collateral of each Credit Party is located at the address(es) indicated in Schedule 5.3. The chief executive office of each Credit Party is located at the address indicated in Schedule 5.3 and

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each Credit Party’s FEIN is identified in Schedule 5.3. Each Credit Party is a “registered organization” within the meaning of Section 9-307 of the UCC, and its jurisdiction or organization is identified next to the name of such Credit Party in Schedule 5.3.

5.4 Inventory and Equipment Records. Each Credit Party keeps correct and accurate records itemizing and describing the type, quality, and quantity of its Inventory and Equipment and the book value thereof.

5.5 Due Organization and Qualification; Subsidiaries.

(a) Each Credit Party is duly organized and existing and in good standing under the laws of the jurisdiction of its organization and qualified to do business in every state where the failure to be so qualified reasonably could be expected to have a Material Adverse Change.

(b) Set forth on Schedule 5.5(b) is a complete and accurate description of the authorized Equity of each Credit Party and its Affiliates, by class and, as of the Closing Date, (i) a description of the number of shares of Equity of each such class that are authorized, issued and outstanding, (ii) a description of the number and percentage of outstanding shares of Equity of each such class that are owned by any Credit Party and its Affiliates (including the relative percentages of ownership of each such Credit Party and/or Affiliate in such Equity) and (iii) the jurisdiction of organization of such Credit Parties. Other than as described on Schedule 5.5(b), there are no (x) subscriptions, options, warrants, calls, rights of first refusal, preemptive or other similar rights relating to any Credit Party’s Equity, including any right of conversion or exchange under any outstanding security or other instrument nor (y) Liens on any Credit Party’s Equity (including, without limitation, Equity held by Affiliates of the Company). No Credit Party is subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any of its shares of Equity or any security convertible into or exchangeable for any of its shares of Equity.

(c) All of the outstanding Equity of each such Subsidiary has been duly authorized, validly issued and is fully paid and non-assessable and owned of record by the Credit Party reflected as the direct owner of such Equity in Schedule 5.5(b).

(d) Except as set forth on Schedule 5.5(b), there are no subscriptions, options, warrants, or calls relating to any units or shares of any Company’s Subsidiaries’ Equity, including any right of conversion or exchange under any outstanding security or other instrument. No Credit Party or any of its respective Subsidiaries is subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any units of any Credit Party’s Subsidiaries’ Equity or any security convertible into or exchangeable or exercisable for any such Equity.

5.6 Due Authorization; No Conflict.

(a) As to each Credit Party, the execution, delivery, and performance by such Credit Party of this Agreement and the Transaction Documents to which it is a party have been duly authorized by all necessary action on the part of such Credit Party.

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(b) As to each Credit Party, the execution, delivery, and performance by such Credit Party of this Agreement and the Transaction Documents to which it is a party do not and will not (i) violate any provision of federal, state, or local law or regulation applicable to any Credit Party, the Governing Documents of any Credit Party, or any order, judgment, or decree of any court or other Governmental Authority binding on any Credit Party, (ii) conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any material Contractual Obligation of any Credit Party, (iii) result in or require the creation or imposition of any Lien of any nature whatsoever upon any properties or assets of any Credit Party, other than Permitted Liens, or (iv) require any approval of any Credit Party’s interestholders or any approval or consent of any Person under any material Contractual Obligation of any Credit Party.

(c) Other than the filing of financing statements, the filing of a Form D with the SEC pursuant to the Securities Act and a Form 25102(f) with the California Commissioner of Corporations and the effectiveness of the Intercreditor Agreement, the execution, delivery, and performance by each Credit Party of this Agreement and the Transaction Documents to which such Credit Party is a party do not and will not require any registration or filing with, consent, or approval of, or notice to, or other action with or by, any Governmental Authority or other Person.

(d) As to each Credit Party, this Agreement and the other Transaction Documents to which such Credit Party is a party, and all other documents contemplated hereby and thereby, when executed and delivered by such Credit Party will be the legally valid and binding obligations of such Credit Party, enforceable against such Credit Party in accordance with their respective terms, except as enforcement may be limited by equitable principles or by bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to or limiting creditors’ rights generally.

(e) The security interests granted in favor of Purchaser pursuant to the Security Documents are validly created, perfected, and first priority Liens, subject only to Permitted Liens.

(f) Any Taxes, fees and other governmental charges in connection with the execution and delivery of this Agreement and the other Transaction Documents or the execution, delivery and sale of the Securities have been or will be paid on or prior to the Closing Date.

5.7 Litigation. There are no actions, suits, proceedings or investigations pending or, to the best knowledge of any Credit Party, threatened against any Credit Party, or any of their Subsidiaries, as applicable, except for (a) matters that are fully covered by insurance (subject to existing deductibles disclosed to Purchaser prior to the Closing Date) as to which the applicable insurance company has acknowledged coverage, and (b) matters arising before or after the Closing Date that, if decided adversely to the Credit Parties, or any of their Subsidiaries, as applicable, reasonably could not be expected to result in a Material Adverse Change.

5.8 No Material Adverse Change.

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(a) The audited consolidated and consolidating balance sheets of the Credit Parties as at December 31, 2002, April 30, 2002 and April 30, 2001 and the audited consolidated and consolidating statements of income and of cash flows for the fiscal year ending on December 31, 2002, reported on by and accompanied by an unqualified report from Ernst & Young LLP, present fairly and accurately the consolidated and consolidating financial condition of the Credit Parties as at such date, and the consolidated and consolidating results of its operations and its consolidated and consolidating cash flows for the respective fiscal years then ended. All such financial statements, including the related schedules and notes thereto, have been prepared in accordance with GAAP applied consistently throughout the periods involved (except as approved by the aforementioned firm of accountants and disclosed therein). The Credit Parties do not have any material Contingent Obligations or liabilities for Taxes that are not reflected in the most recent financial statements referred to in this paragraph. During the period from December 31, 2002 to and including the date hereof there has been no material Asset Disposition by any Credit Party of any material part of its business or property.

(b) Since December 31, 2002, there has been no development or event that has had or could reasonably be expected to result in a Material Adverse Change.

5.9 Fraudulent Transfer.

(a) Each Credit Party is, and after giving effect to the transactions contemplated hereby will be, Solvent.

(b) No transfer of property is being made by any Credit Party and no obligation is being incurred by any Credit Party or Guarantor in connection with the transactions contemplated by this Agreement or the other Transaction Documents with the intent to hinder, delay, or defraud either present or future creditors of the Credit Parties.

5.10 Environmental Condition. Except as set forth on Schedule 5.10, (a) to the Credit Parties’ best knowledge after due diligence, none of the Credit Parties’ properties or assets has ever been used in the disposal of, or to produce, store, handle, treat, release, or transport, any Hazardous Materials, where such production, storage, handling, treatment, release or transport was in violation of any Environmental Law, (b) to the Credit Parties’ best knowledge after due diligence, none of the Credit Parties’ Properties or assets has ever been designated or identified in any manner pursuant to any Environmental Law as a Hazardous Materials release or disposal site, (c) none of the Credit Parties has received notice that a Lien arising under any Environmental Law has attached to any revenues or to any real property owned or operated by the Credit Parties, (d) none of the Credit Parties has received a summons, citation, notice, directive, order or inquiry from the Environmental Protection Agency or any other federal, state or local governmental agency concerning any action or omission by any Credit Party resulting in the release or disposing of Hazardous Materials into the environment or with respect to the presence or release of Hazardous Materials on, under, in or from the Credit Parties’ Properties or assets and (e) to the Credit Parties’ best knowledge after due diligence, no Hazardous Materials are present on, in or under any Credit Parties’ properties or assets, except for any types or amounts that do not require remediation, mitigation, monitoring or other control under any Environmental Law.

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5.11 Brokerage Fees. Except as set forth on Schedule 5.11, the Credit Parties have not utilized the services of any broker or finder in connection with the Credit Parties’ obtaining financing from Purchaser under this Agreement and no brokerage commissions or finders fees are payable by the Credit Parties in connection herewith.

5.12 Proprietary Rights. Each Credit Party owns, or is licensed to use, all Proprietary Rights necessary for the conduct of its business as currently conducted, as set forth in Schedule 5.12. Other than as set forth on Schedule 5.12, no material claim has been asserted or is pending by any Person challenging or questioning the use of any Proprietary Right or the validity or effectiveness of any Proprietary Right, nor does any Credit Party know of any valid basis for any such claim. Neither the use of Proprietary Rights by the Credit Parties nor the continued operation of the Company’s businesses as presently conducted will infringe on, interfere with, impinge upon, misappropriate, or otherwise come into conflict with, any rights of any Person in any material respect.

5.13 Leases.

(a) The Credit Parties enjoy peaceful and undisturbed possession under all leases material to the business of the Credit Parties and to which the Credit Parties are a party or under which the Credit Parties are operating. All of such leases are valid and subsisting and no material default by the Credit Parties exists under any of them.

(b) Each Credit Party and its Subsidiaries has paid all payments required to be made by it under leases of real property where any of the Collateral is or may be located from time to time (other than any lease the amount or validity of which are currently subject to a Permitted Protest), and no landlord Lien has been filed, and, to the best knowledge of the Credit Parties in the reasonable and prudent conduct of business, no claim is being asserted, with respect to any such payments.

5.14 DDAs. Set forth on Schedule 5.14 are all of the DDAs of each Credit Party, including, with respect to each depository (a) the name and address of that depository, and (b) the account numbers of the accounts maintained with such depository.

5.15 Complete Disclosure.

(a) No statement or information contained in this Agreement, any other Transaction Document or any other document, certificate or statement furnished to the Collateral Agent, Purchaser or any of them, by or on behalf of any Credit Party or any of its Subsidiaries for use in connection with the transactions contemplated by this Agreement or the other Transaction Documents (including the documents furnished pursuant to Sections 3.20 and 3.21 and all information contained in the schedules hereto or in the other Transaction Documents) for purposes of or in connection with this Agreement, the other Transaction Documents or any transaction contemplated herein or therein, contained as of the date such statement, information, document or certificate was so furnished, any untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements contained herein or therein not misleading. The Projections and Pro Forma Balance Sheet contained in the materials referenced above are based upon good faith estimates and assumptions believed by management of the Company to be reasonable at the time made, it being recognized

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by Purchaser that such financial information as it relates to future events is not to be viewed as fact and that actual results during the period or periods covered by such financial information may differ from the projected results set forth therein by a material amount. There is no fact or circumstance known to any Credit Party or any of its Subsidiaries that could reasonably be expected to result in a Material Adverse Change that has not been expressly disclosed in writing to the Collateral Agent and Purchaser for use in connection with the transactions contemplated hereby and by the other Transaction Documents.

(b) The Company has filed all required SEC Reports with the SEC (including all filed reports, schedules, forms, statements and other documents whether or not required, the “Company SEC Documents”). As of their respective dates, the Company SEC Documents complied in all material respects with the requirements of the Securities Act or the Exchange Act, as the case may be, and the rules and regulations of the SEC promulgated thereunder applicable to such Company SEC Documents, and none of the Company SEC Documents contained any untrue statement of a material fact or omitted to state a 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. Except to the extent that information contained in any Company SEC Document has been revised or superseded by a later filed Company SEC Document which was filed and publicly available prior to the date of this Agreement, none of the Company SEC Documents contains any untrue statement of a material fact or omits 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. The financial statements of the Company included in the Company SEC Documents comply as to form in all material respects with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto, have been prepared in accordance with GAAP (except, in the case of unaudited statements, as permitted by the SEC) applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto) and fairly present the consolidated financial position of the Company and its consolidated Subsidiaries as of the dates thereof and the consolidated results of their operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal year-end adjustments). Except for liabilities and obligations incurred in the ordinary course of business consistent with past practice since the date of the most recent consolidated balance sheet included in the Company SEC Documents, neither the Company nor any of its Subsidiaries has any liabilities or obligations of any nature (whether accrued, absolute, contingent or otherwise) required by GAAP to be recognized or disclosed on a consolidated balance sheet of the Company and its consolidated Subsidiaries or in the notes thereto.

5.16 Indebtedness. Set forth on Schedule 5.16 is a true and complete list of all Indebtedness of each Credit Party outstanding immediately prior to the Closing Date that is to remain outstanding after the Closing Date and such Schedule accurately reflects the aggregate principal amount of such Indebtedness and the principal terms thereof.

5.17 Private Offering; NASDAQ Compliance; Investment Company Act; Public Utility.

(a) Neither any Credit Party nor any Person acting on its behalf has directly or indirectly offered or sold the Securities by any form of general solicitation or general advertising (including, without limitation, any advertisement, article, notice or other

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communication published in any newspaper, magazine or similar media or any broadcast over television or radio or any seminar or meeting whose attendees have been invited by any form of general solicitation or general advertising).

(b) Neither any Credit Party nor any Person acting on behalf of such Credit Party has, either directly or indirectly, sold or offered for sale to, or otherwise approached or negotiated in respect thereof with, any Person any of the Securities except as contemplated by this Agreement, and neither any Credit Party nor any Person acting on its behalf (other than Purchaser and its Affiliates) will sell or offer for sale to any Person any Security or other similar security of the Company to, or solicit any offers to buy any such security from, or otherwise approach or negotiate in respect thereof with, any Person or Persons so as thereby to bring the issuance or sale of any of the Securities within the registration provisions of Section 5 of the Securities Act. The offer and sale of the Securities pursuant to this Agreement is exempt from the registration and prospectus delivery requirements of the Securities Act.

(c) None of the Credit Parties has, at any time prior to the date of this Agreement, received any indication, whether in writing or orally, from any person associated with the NASD that the staff of the NASD has determined, intends to determine or may in the future determine that any of the Company’s past issuances of its common stock were made in violation of Rule 4350 of the Nasdaq Stock Market.

(d) None of the Credit Parties is, and the issuance and sale of the Securities pursuant to this Agreement will not cause any Credit Party to be, an “investment company” or under the “control” of an “investment company” as such terms are defined in the Investment Company Act.

(e) None of the Credit Parties will be deemed by any Governmental Authority to be a “public utility” or an “affiliated interest” under any existing state or other law, rule or regulation.

5.18 Use of Proceeds. As further set forth on Schedule 5.18, the proceeds of the Note and the Warrant shall be used (i) to consummate the BRC Transaction, (ii) to repay $11,338,215.25 of the indebtedness incurred pursuant to the BOFA Credit Agreement, (iii) to repay certain bridge loans up to an amount not to exceed $950,000 in the aggregate, (iv) to pay Purchaser’s Expenses in connection with the transactions contemplated hereunder and other expenses related to the Closing; provided that any expenses payable to Bathgate LLC and to any non-employee of the Company related to the BRC Transaction (other than legal expenses) shall not exceed $400,000 in the aggregate and (v) the remainder for general working capital and corporate purposes.

5.19 Federal Regulations. No part of the proceeds of the Securities will be used for purchasing or carrying any “margin stock” (within the meaning of Regulation U) or for the purpose of purchasing, carrying or trading in any securities under such circumstances as to involve the Credit Parties in a violation of Regulation X or to involve any broker or dealer in a violation of Regulation T. No indebtedness being reduced or retired out of the proceeds of the Securities was or will be incurred for the purpose of purchasing or carrying any “margin stock” (within the meaning of Regulation U). None of the transactions contemplated by this Agreement

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(including, without limitation, the direct and indirect use of proceeds of the Securities) will violate or result in a violation of Regulation T, Regulation U or Regulation X.

5.20 Labor Matters. There are no strikes, stoppages, slowdowns or other labor disputes against the Credit Parties pending or, to the best knowledge of the Credit Parties after due diligence, threatened that (individually or in the aggregate) could reasonably be expected to result in a Material Adverse Change. Hours worked by and payment made to employees of the Credit Parties have not been in violation of the Fair Labor Standards Act or any other applicable Requirement of Law dealing with such matters that (individually or in the aggregate) could reasonably be expected to result in a Material Adverse Change. All payments due from the Credit Parties on account of employee health and welfare insurance that (individually or in the aggregate) could reasonably be expected to result in a Material Adverse Change if not paid have been paid or accrued as a liability on the Books of such Credit Parties in accordance with GAAP.

5.21 Employee Benefit Plans; ERISA. For purposes of this Section 5.21 and Section 10.1(o), the term “Credit Party” shall include any Person organized under the laws of the United States or operating therein that is or would be aggregated with the Credit Parties under Section 414(b), (c), (m), or (o) of the Code (an “ERISA Affiliate”). However, this Section 5.21 will not apply to a “Multiemployer Plan” (as defined in Section 4001(a)(3) of ERISA), except as expressly referred to herein.

(a) Schedule 5.21 sets forth a true, correct and complete list of:

(i) Each termination, change in control or severance agreement involving the Credit Parties, on the one hand, and any of its respective employees whose annual compensation is at a base rate equal to or exceeding $50,000, on the other hand;

(ii) All employee benefit plans, as defined in ERISA Section 3(3); and

(iii) All other profit-sharing, bonus, stock option, stock purchase, stock bonus, restricted stock, stock appreciation right, phantom stock, vacation pay, holiday pay, tuition reimbursement, scholarship, severance, dependent care assistance, excess benefit, incentive compensation, salary continuation, supplemental retirement, employee loan or loan guarantee program, split dollar, cafeteria plan, and other benefits or compensation arrangements;

in each case maintained or contributed to by each Credit Party for the benefit of its employees (or former employees) and/or their beneficiaries or under which a Credit Party may incur any liability. All of these types of arrangements shall be collectively referred to as “Benefit Plans.” An arrangement will not fail to be a Benefit Plan simply because it only covers one individual, or because such Credit Party’s obligations under the plan arise by reason of its being a “successor employer” under applicable laws. Furthermore, a Voluntary Employees’ Beneficiary Association under Section 501(c)(9) of the Code will be considered a Benefit Plan for this purpose.

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(b) The Credit Parties have delivered to Purchaser a true and complete copy of the following documents, to the extent that they are applicable:

(i) Each Benefit Plan and any related funding agreements (e.g., trust agreements or insurance contracts), including all amendments (and Schedule 5.21 includes a description of any such amendment that is not in writing);

(ii) The current draft of the summary plan description and all subsequent summaries of material modifications of each Benefit Plan;

(iii) The most recent Internal Revenue Service determination letter for each Benefit Plan that is intended to qualify for favorable income Tax treatment under Section 401(a) or 501(c)(9) of the Code, which determination letter reflects all amendments that have been made to the plan (except as set forth in Schedule 5.21); and

(iv) The two (2) most recent Form 5500s (including all applicable Schedules and the opinions of the independent accountants) that were filed on behalf of the Benefit Plan.

(c) All costs of administering and contributions required to be made to each Benefit Plan under the terms of that Benefit Plan, ERISA, the Code, or any other applicable law have been timely made, and are fully deductible in the year for which they were paid. All other amounts that should be accrued to date as liabilities of the Credit Parties under or with respect to each Benefit Plan (including administrative expenses and incurred but not reported claims) for the current plan year of the plan have been recorded on the Books of the Credit Parties. There will be no liability of the Credit Parties (i) with respect to any Benefit Plan that has previously been terminated or (ii) under any insurance policy or similar arrangement procured in connection with any Benefit Plan in the nature of a retroactive rate adjustment, loss sharing arrangement, or other liability arising wholly or partially out of events occurring before the Closing.

(d) Each Benefit Plan has been operated at all times in accordance with its terms, and complies currently, and has complied in the past, both in form and in operation, with all applicable laws, including ERISA and the Code. The Internal Revenue Service has issued a favorable determination letter with respect to each Benefit Plan that is intended to qualify under Section 401(a) or 501(c)(9) of the Code, and no event has occurred (either before or after the date of the letter) that would disqualify the plan.

(e) The Credit Parties do not maintain any plan that provides (or will provide) medical, death or other benefits to one or more former employees or independent contractors (including retirees) following termination of employment, other than benefits that are required to be provided under COBRA or any state law continuation coverage or conversion rights. The Credit Parties have complied in all material respects with the continuation coverage requirements of COBRA.

(f) There are no investigations, proceedings, lawsuits or claims pending or, to the best knowledge of the Credit Parties, threatened relating to any Benefit Plan.

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(g) The Credit Parties do not have any intention or commitment, whether legally binding or not, to create any additional Benefit Plan, or to modify any existing Benefit Plan so as to increase benefits to participants or the cost of maintaining the plan. The benefits under all Benefit Plans are as represented, and have not been, and will not be increased subsequent to the date documents are provided to Purchaser except in the ordinary course of business and consistent with competitive business standards. No statement, either oral or written, has been made by any Credit Party (or any agent of any Credit Party) to any Person regarding any Benefit Plan that is not in accordance with the Benefit Plan that could have adverse economic consequences to Purchaser.

(h) None of the Persons performing services for the Credit Parties has been improperly classified as being independent contractors, leased employees, or as being exempt from the payment of wages for overtime.

(i) None of the Benefit Plans provide any benefits that (i) become payable or become vested solely as a result of the consummation of this transaction or (ii) would result in excess parachute payments (within the meaning of Section 280G of the Code), either (A) solely as a result of the consummation of this transaction or (B) as a result of the consummation of this transaction and any actions taken by Purchaser after the Closing Date. Furthermore, the consummation of this transaction will not require the funding (whether formal or informal) of the benefits under any Benefit Plan (e.g., contributions to a “rabbi trust”).

(j) None of the assets of any Benefit Plan that is a “pension plan” within the meaning of Section 3(2) of ERISA are invested in a group annuity contract or other insurance contract that is subject to any surrender charge, interest rate adjustment, or other similar expense upon its premature termination.

(k) No Benefit Plan has any interest in any annuity contract or other investment or insurance contract issued by an insurance company that is the subject of bankruptcy, conservatorship, rehabilitation, or similar proceeding.

(l) With respect to each Benefit Plan that is subject to Title IV of ERISA:

(i) No amount is due or owing from the Credit Parties to the PBGC, other than a liability for premiums under ERISA Section 4007;

(ii) All premiums have been paid to the PBGC on a timely basis;

(iii) The value, determined on a termination basis using the actuarial assumptions stated in the plan, of all accrued and ancillary benefits (whether or not vested) under each such plan did not exceed, as of the most recent valuation date, and will not exceed as of the Closing Date, the then-current fair market value of the assets of the plan;

(iv) No reportable events (within the meaning of ERISA Section 4043) have occurred;

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(v) There is no accumulated funding deficiency (within the meaning of Code Section 412 or ERISA Section 302), whether or not such deficiency has been waived;

(vi) There is no “unfunded benefit liability” (within the meaning of Section 4001(a)(18) of ERISA, but excluding from the definition of “current value” of “assets” accrued but unpaid contributions); and

(vii) the Company and each ERISA Affiliate has made when due any “required installments” within the meaning of Section 412(m) of the Code and Section 302(e) of ERISA, whichever may apply.

(m) None of the Credit Parties has incurred any withdrawal liability (including any contingent or secondary withdrawal liability) to any Multiemployer Plan, and no event has occurred, and there exists no condition or set of circumstances, that presents a material risk of the occurrence of any withdrawal (partial or otherwise) from, or the partition, termination, reorganization, or insolvency of any Multiemployer Plan that could result in any liability on behalf of any Credit Party to a Multiemployer Plan. All contributions required to be made by the Company and its ERISA Affiliates to any Multiemployer Plan have been timely made.

(n) The aggregate liability of the Credit Parties to all Multiemployer Plans in the event of a complete withdrawal therefrom, as of the close of the most recent plan year of the Multiemployer Plan ended prior to the date hereof would not exceed $100,000. To the best knowledge of the Credit Parties, there has been no material change in the (i) financial condition of any Multiemployer Plan, (ii) actuarial assumptions, (iii) required level of Credit Party contributions, or (iv) level of benefits provided under any Multiemployer Plan since the close of the most recent plan year of the Multiemployer Plan that, individually or in the aggregate, would materially increase the amount of this liability.

(o) No Termination Event has occurred or is reasonably expected to occur that, when taken together with all other such Termination Events, could reasonably be expected to result in material liability to any Credit Party.

5.22 Taxes. Except as set forth on Schedule 5.22:

(a) Filing of Tax Returns. Each Credit Party has duly and timely filed (or has had duly and timely filed on its behalf) with the appropriate taxing authorities all material Tax Returns required to be filed through the date hereof. All such Tax Returns filed are complete and accurate in all material respects. No Credit Party is currently the beneficiary of any extension of time within which to file any Tax Return. No claim has ever been made by an authority in a jurisdiction where any Credit Party does not file Tax Returns that such Credit Party is or may be subject to taxation by that jurisdiction.

(b) Payment of Taxes. All Taxes owed by the Credit Parties (whether or not shown on any Tax Return) have been paid (other than Taxes not currently payable and Taxes subject to a bonafide dispute, which Taxes in either case have been adequately reserved). The unpaid Taxes of the Credit Parties (i) did not, as of the dates of each Credit Party’s financial statements attached hereto as Exhibit Q, exceed the reserve for Tax liability (excluding any

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reserve for deferred Taxes established to reflect timing differences between book and Tax income) set forth on the face of the Company’s balance sheet (rather than in any notes thereto), and (ii) will not exceed the reserve for Tax liability (rather than any reserve for deferred Taxes established to reflect timing differences between book and Tax income) shown on the face of the Company’s balance sheet as of the Closing Date.

(c) Audits, Investigations, Disputes or Claims. No material deficiencies for Taxes have been claimed, proposed or assessed by any taxing authority against any Credit Party. There are no pending or, to the best knowledge of any Credit Party, threatened audits, investigations, disputes or claims or other actions for or relating to any liability for Taxes with respect to the Credit Parties, and there are no matters under discussion with any taxing authorities, or known to any Credit Party, with respect to Taxes that are likely to result in a material additional liability for Taxes with respect to the Credit Parties. Audits of foreign, federal, state and local Tax Returns by the relevant taxing authorities have been completed for the periods set forth in Schedule 5.22 and, except as set forth in such Schedule, no Credit Party nor any predecessor to any Credit Party has been notified that any taxing authority intends to audit a Tax Return for any other period. None of the Credit Parties has waived any statute of limitations in respect of Taxes or agreed to any extension of time with respect to a Tax assessment or deficiency. No power of attorney granted by any Credit Party with respect to any Taxes is currently in effect.

(d) Liens. There are no Liens for Taxes (other than for current Taxes not yet due and payable) on any of the assets of any Credit Party or any shares of any Credit Party’s Equity.

(e) Tax Elections. All elections with respect to Taxes affecting the Credit Parties or their assets, as of the date hereof are set forth in Schedule 5.22. None of the Credit Parties has: (i) consented at any time under Section 341(f)(1) of the Code to have the provisions of Section 341(f)(2) of the Code apply to any disposition of any of such Credit Party’s assets; (ii) agreed, or is required, to make any adjustment under Section 481(a) of the Code by reason of a change in accounting method or otherwise; (iii) made an election, or is required, to treat any of such Credit Party’s assets as owned by another Person pursuant to the provisions of former Section 168(f) of the Code or as Tax-exempt bond financed property or Tax-exempt use property within the meaning of Section 168 of the Code; (iv) acquired and does not own any assets that directly or indirectly secure any debt the interest on which is tax exempt under Section 103(a) of the Code; (v) made or will make a consent dividend election under Section 565 of the Code; or (vi) made any of the foregoing elections or is required to apply any of the foregoing rules under any comparable foreign, state or local Tax provision.

(f) Prior Affiliated Groups. None of the Credit Parties is and has ever been a member of an affiliated group of corporations within the meaning of Section 1504 of the Code or any group that has filed a combined, consolidated or unitary Return.

(g) Other Entity Liability. No Credit Party has any liability for the Taxes of any Person (other than the Credit Parties) (i) under Treasury Regulations Section 1.1502-6 (or any similar provision of state, local or foreign law), (ii) as a transferee or successor, (iii) by contract, or (iv) otherwise.

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(h) Tax Sharing Agreements. There are no Tax-sharing agreements or similar arrangements (including indemnity arrangements) with respect to or involving the Credit Parties or any of their assets or business, and after the Closing Date, the Credit Parties, their assets and their business shall not be bound by any such Tax-sharing agreements or similar arrangements or have any liability thereunder for amounts due in respect of periods prior to the Closing Date.

(i) Partnerships, Single Member LLCs, CFCs and PHCs. Except for its relationship with the other Credit Parties and as set forth in Schedule 9.24, no Credit Party (i) is subject to any joint venture, partnership, or other arrangement or contract which is treated as a partnership for Tax purposes, (ii) owns a single member limited liability company which is treated as a disregarded entity, (iii) is a shareholder of a “controlled foreign corporation” as defined in Section 957 of the Code (or any similar provision of state, local or foreign law) and (iv) is a “personal holding company” as defined in Section 542 of the Code (or any similar provision of state, local or foreign law).

(j) No Withholding. None of the Credit Parties has been a United States real property holding corporation within the meaning of Section 897(c)(2) of the Code during the applicable period specified in Section 897 of the Code. The Credit Parties have withheld and paid all Taxes required to have been withheld and paid in connection with amounts paid or owing to any employee, independent contractor, creditor, stockholder or other third party. The transactions contemplated herein are not subject to the Tax withholding provisions of Section 3406 of the Code, or of Subchapter A of Chapter 3 of the Code or of any other provision of law.

(k) International Boycott. The Credit Parties have never participated in and are not participating in an international boycott within the meaning of Section 999 of the Code.

(l) Permanent Establishment. None of the Credit Parties has or has ever had a permanent establishment in any foreign country as defined in any applicable Tax treaty or convention between the United States of America and such foreign country.

(m) None of the Credit Parties has distributed the Equity of any corporation in a transaction satisfying the requirements of Section 355 of the Code since April 16, 1997, and no Equity of any of the Credit Parties has been distributed in a transaction satisfying the requirement of Section 355 of the Code since April 16, 1997.

(n) None of the outstanding Indebtedness of any of the Credit Parties constitutes indebtedness with respect to which any interest deductions may be disallowed under Sections 163(i) or 163(e) or 279 of the Code or under any other provision of applicable law.

5.23 Contingent Obligations. Except as set forth on Schedule 5.23 or as reflected in the Company’s financial statements and the notes thereto, none of the Credit Parties is subject to or has incurred or assumed any material Contingent Obligations.

5.24 Other Obligations. Except as set forth on Schedule 5.24, the Company, each of the other Credit Parties and each Affiliate thereof is in material compliance with the

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terms and conditions of (i) the Senior Credit Documents and (ii) the Existing Notes, in each case, to which such Person is a party.

5.25 Power of Attorney. No power of attorney granted by any Credit Party or any of its Subsidiaries is currently in effect.

5.26 Relationship with General Electric Company. Other than the items listed on Schedule 5.26, none of the Credit Parties has any equity, creditor, or similar relationship (including, without limitation, any investment in, or any debtor, revolving credit, leasing or creditor relationship, but excluding any vendor/vendee relationship) with General Electric Company or any of its Subsidiaries.

ARTICLE 6

REPRESENTATIONS AND

WARRANTIES OF PURCHASER

Purchaser hereby represents and warrants as follows:

6.1 Due Organization. It is duly organized and existing in good standing under the laws of the jurisdiction of its organization and the State of California.

6.2 Authorization; No Contravention. The execution, delivery and performance by it of this Agreement: (a) is within its power and authority and has been duly authorized by all necessary action; (b) does not contravene the terms of its Governing Documents; and (c) will not violate, conflict with or result in any breach or contravention of any of its Contractual Obligations, or any order or decree directly relating to it except where such violation could not reasonably be expected to result in a Material Adverse Change.

6.3 Binding Effect. This Agreement has been duly executed and delivered by it and this Agreement constitutes its legal, valid and binding obligation, enforceable against it in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, or similar laws affecting the enforcement of creditors’ rights generally or by equitable principles relating to enforceability.

6.4 No Legal Bar. The execution, delivery and performance of this Agreement by it will not violate any provision of federal, state or local Requirement of Law or regulation applicable to it.

6.5 Purchase for Own Account.

(a) It is an “accredited investor” within the meaning of Rule 501(a) of Regulation D under the Securities Act and is acquiring the Securities for its own account and not with a view to any distribution thereof or with any present intention of offering or selling any of the Securities in a transaction that would violate or require registration under the Securities Act or the securities laws of any state of the United States or any other applicable jurisdiction and Purchaser will not offer, sell, transfer, pledge, hypothecate or otherwise dispose of the Securities unless pursuant to a transaction either that is registered under, or that is, based upon the advice of

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counsel to Purchaser, exempt from registration under, the Securities Act and in compliance with applicable state and other securities laws.

(b) It has such knowledge and experience in financial and business matters so as to be capable of evaluating the merits and risks of its investment in the Securities and it is capable of bearing the economic risks of such investment and acknowledges that the Securities, as of the date hereof, have not been registered under the Securities Act or the securities laws of any state or other jurisdiction. Purchaser has conducted such investigation of the Credit Parties’ business and financial condition as Purchaser has determined to be appropriate in the exercise of due diligence.

(c) It is not an “investment company” within the meaning of the Investment Company Act and the regulations thereunder.

6.6 Broker’s Finder’s or Similar Fees. There are no brokerage commissions, finder’s fees or similar fees or commissions payable in connection with the transactions contemplated hereby based on any agreement, arrangement or understanding with it or any action taken by it.

6.7 Governmental Authorization: Third Party Consent. No approval, consent, compliance, exemption, authorization, or other action by, or notice to, or filing with, any Governmental Authority or any other Person is necessary or required in connection with the execution, delivery or performance by it or enforcement against it of this Agreement or the transactions contemplated hereby.

ARTICLE 7

INDEMNIFICATION

7.1 Indemnification.

(a) In addition to all other sums due hereunder or provided for in this Agreement or in the other Transaction Documents, each Credit Party agrees, jointly and severally to pay, indemnify, defend, and hold the Collateral Agent, Purchaser, each of their respective Affiliates and each of their respective officers, directors, partners, trustees, members, advisors (including, without limitation, attorneys, accountants and financial advisors), employees, agents, attorneys-in-fact, controlling persons and any person designated by Purchaser to attend the meetings described in Section 8.15 (including, without limitation, any Purchaser Representative) (each, an “Indemnified Person”) harmless (to the fullest extent permitted by law) from and against any and all claims, demands, suits, actions, investigations, proceedings, damages, costs, expenses including, but not limited to, punitive, exemplary, consequential or indirect damages and liabilities of any kind, and all reasonable attorneys’ fees and disbursements and other costs and expenses actually incurred in connection therewith, or for recovery under directors’ and officers’ liability insurance policies maintained by the Company or any other Credit Party (as and when they are incurred and irrespective of whether suit is brought) (collectively “Claims”), at any time asserted against, imposed upon, or incurred by any of them (i) in connection with or as a result of or related to the execution, delivery, enforcement, performance, or administration of, or breach of any covenant, representation or warranty

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contained in, the Proposal Letter, this Agreement or any of the other Transaction Documents, or the transactions contemplated hereby or thereby, including, without limitation, any Tax liabilities or Claims in respect of any brokerage commissions or finders fees incurred by the Credit Parties in connection with obtaining financing, (ii) with respect to any Person designated by the Purchaser to attend as an observer the meetings described in Section 8.15, in respect of or in connection with any actions or inactions by such person, or other performance by such person of its rights and duties, pursuant to Section 8.15 and (iii) with respect to any investigation, litigation, or proceeding related to this Agreement or any of the other Transaction Documents, or the use of the proceeds provided hereunder (irrespective of whether any Indemnified Person is a party thereto), or any act, omission, event, or circumstance in any manner related thereto including, but not limited to, in connection with the enforcement of the indemnification obligations set forth herein (all the foregoing, collectively, the “Indemnified Liabilities”). The foregoing to the contrary notwithstanding, no Credit Party shall have any obligation to any Indemnified Person under this Section 7.1 with respect to any Indemnified Liability that a court of competent jurisdiction finally determines in a non-appealable decision to have resulted from the gross negligence or willful misconduct of such Indemnified Person. This provision shall survive the termination of this Agreement and the repayment of the Obligations. If any Indemnified Person makes any payment to any other Indemnified Person with respect to an Indemnified Liability as to which any Credit Party was required to indemnify the Indemnified Person receiving such payment, the Indemnified Person making such payment is entitled to be indemnified and reimbursed by the Credit Parties with respect thereto. WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO EACH INDEMNIFIED PERSON WITH RESPECT TO INDEMNIFIED LIABILITIES WHICH IN WHOLE OR IN PART CAUSED BY OR ARISE OUT OF ANY NEGLIGENT ACT OR OMISSION OF SUCH INDEMNIFIED PERSON OR OF ANY OTHER PERSON.

(b) Upon notice to any Credit Party specifying in reasonable detail the basis therefor, Purchaser may setoff any amount to which Purchaser may be entitled under this Article 7 against any amounts otherwise payable to such Credit Party by Purchaser or any of its Affiliates. The exercise of such right of setoff by Purchaser in good faith, whether or not ultimately determined to be justified, will not constitute a breach or default under this Agreement or any other Transaction Document. Neither the exercise of nor the failure to exercise such right of setoff will constitute an election of remedies or limit Purchaser in any manner in the enforcement of any other remedies that may be available to Purchaser.

(c) THE INDEMNIFICATION PROVISIONS IN THIS ARTICLE 7 SHALL BE ENFORCEABLE REGARDLESS OF WHETHER THE LIABILITY IS BASED UPON PAST, PRESENT OR FUTURE ACTS, CLAIMS OR LAWS (INCLUDING ANY PAST, PRESENT OR FUTURE BULK SALES LAW, ENVIRONMENTAL LAW, FRAUDULENT TRANSFER ACT, OCCUPATIONAL SAFETY AND HEALTH LAW OR PRODUCTS LIABILITY, SECURITIES OR OTHER LAW) AND REGARDLESS OF WHETHER ANY PERSON (INCLUDING THE PERSON FROM WHOM INDEMNIFICATION IS SOUGHT) ALLEGES OR PROVES THE SOLE, CONCURRENT, CONTRIBUTORY OR COMPARATIVE NEGLIGENCE OF THE PERSON SEEKING INDEMNIFICATION OR THE SOLE OR CONCURRENT STRICT LIABILITY IMPOSED UPON THE PERSON SEEKING INDEMNIFICATION.

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7.2 Procedure; Notification. Each Indemnified Person under this Article 7 will, promptly after the receipt of notice of the commencement of any claim against such Indemnified Person in respect of which indemnity may be sought from any Credit Party under this Article 7, notify the Company on behalf of the Credit Parties in writing of the commencement thereof. The failure of any Indemnified Person so to notify the Company of any such action shall not relieve the Company or any other Credit Party from any liability which it may have to such Indemnified Person unless, and only to the extent that, such failure results in the Company’s forfeiture of substantive rights or defenses. In case any such Claim shall be brought against any Indemnified Person and it shall notify the Company on behalf of the Credit Parties of the commencement thereof, the Credit Parties shall be entitled to assume the defense thereof at their own expense, with counsel satisfactory to Purchaser in its reasonable judgment; provided, however, that any Indemnified Person may, at its own expense, retain separate counsel to participate in such defense. Notwithstanding the foregoing, in any Claim in which any Credit Party, on the one hand, and an Indemnified Person, on the other hand, is, or is reasonably likely to become, a party, such Indemnified Person shall have the right to employ separate counsel at the Credit Parties’ expense and to control its own defense of such Claim if, in the reasonable opinion of counsel to such Indemnified Person, a conflict or potential conflict exists between the Company or any other Credit Party, on the one hand, and such Indemnified Person, on the other hand, that would make such separate representation advisable; provided, however, that in no event shall the Credit Parties be required to pay fees and expenses under this Article 7 for more than one firm of attorneys in any jurisdiction in any one legal action or group of related legal actions. Each Credit Party agrees that it will not, without the prior written consent of Purchaser, settle, compromise or consent to the entry of any judgment in any pending or threatened Claim relating to the matters contemplated hereby (if any Indemnified Person is a party thereto or has been actually threatened to be made a party thereto) unless such settlement, compromise or consent includes an unconditional release of Purchaser and each other Indemnified Person from all liability arising or that may arise out of such claim, action or proceeding. No Credit Party shall be liable for any settlement of any claim, action or proceeding effected against an Indemnified Party without its written consent, which consent shall not be unreasonably withheld or delayed. The rights accorded to Indemnified Persons hereunder shall be in addition to any rights that any Indemnified Person may have at common law, in equity, by separate agreement or otherwise.

7.3 Registration Rights Agreement. Notwithstanding anything to the contrary in this Article 7, the indemnification, reimbursement and contribution provisions of the Registration Rights Agreement shall govern any claim made with respect to registration statements filed pursuant thereto or sales made thereunder.

ARTICLE 8

AFFIRMATIVE COVENANTS

Until the payment and performance in full in immediately available funds of all Obligations under the Transaction Documents, each Credit Party hereby covenants and agrees, jointly and severally, that it shall, and shall cause each of its Subsidiaries (including BRC for purposes of this Article 8, and BRC shall be deemed to be a Subsidiary for purposes of this Article 8) to:

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8.1 Accounting System. Maintain a system of accounting that enables the Credit Parties to produce financial statements (and all of their financial statements delivered to Purchaser or filed with the SEC shall be produced) in accordance with GAAP, consistently applied, and maintain records pertaining to the Collateral that contain information as from time to time reasonably may be requested by Purchaser. The Credit Parties also shall keep an inventory and equipment reporting system that shows all additions, sales, claims, returns, and allowances with respect to the Inventory and Equipment.

8.2 Reporting Package. Provide Purchaser with a reporting package covering the matters set forth in Schedule 8.2 as soon as reasonably practicable following the end of the applicable reporting period (and, in any event, (i) in the case of any monthly reporting requirements, within thirty (30) days (or forty-five (45) days in the case of a month that is the last month in one of a fiscal quarter, or such shorter period as the SEC shall require from time to time with respect to the filing by the Company of Form 10-Q quarterly reports) after the end of each month and (ii) in the case of any quarterly monthly reporting requirements, within forty-five (45) days after the end of each quarter (or ninety (90) days in the case of the Company’s fourth fiscal quarter, or such shorter period as the SEC shall require from time to time for the filing of the Company’s Annual Report on Form 10-K).

In addition, each Credit Party agrees to cooperate fully with Purchaser using reasonable means and methods to facilitate and implement a system of electronic collateral reporting in order to provide electronic reporting reasonably satisfactory to Purchaser of each of the items set forth in Schedule 8.2.

8.3 Financial Statements, Reports, Certificates. Deliver to Purchaser:

(a) Quarterly Reports. As soon as available, but in any event within forty-five (45) days (or such shorter period as the SEC shall require from time to time with respect to the filing by the Company of Form 10-Q quarterly reports) after the end of the first three (3) quarterly periods during the Company’s fiscal year:

(i) a Company prepared consolidated and consolidating balance sheet, income statement, a consolidated statement of cash flow covering the Company’s and its Subsidiaries’ (including Foreign Subsidiaries) operations, and a consolidated statement of cash flow covering the Company’s and its Subsidiaries’ (excluding Foreign Subsidiaries) operations during such quarter and the portion of the fiscal year through the end of such quarter, setting forth in each case in comparative form the figures for the previous year;

(ii) a certificate signed by the Chief Financial Officer of the Company to the effect that:

(A) the financial statements delivered hereunder have been prepared in accordance with GAAP (except for the lack of footnotes and being subject to year-end audit adjustments) and fairly present in all material respects the financial condition of the Company and its Subsidiaries at such dates;

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(B) the representations and warranties of the Credit Parties contained in this Agreement and the other Transaction Documents are true and correct in all material respects on and as of the date of such certificate, as though made on and as of such date (except to the extent that such representations and warranties relate solely 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); and

(C) there does not exist any condition or event that constitutes a Default or Event of Default (or, to the extent of any non-compliance, describing such non-compliance as to which he or she may have knowledge and what action the Credit Parties have taken, are taking, or propose to take with respect thereto); and

(iii) a Compliance Certificate demonstrating, in reasonable detail, compliance at the end of such quarter with the financial covenants contained in Section 9.18.

The report required by this Section 8.3(a) shall be deemed timely delivered hereunder if and to the extent the Company avails itself of the extension provided by the Exchange Act Rule 12b-25 so long as such report is filed on or before the applicable filing date as so extended.

(b) Annual Reports. As soon as available, but in any event within ninety (90) days after the end of the Company’s fiscal year (or such shorter period as the SEC shall require from time to time with respect to the filing by a reporting company of Form 10-K annual reports):

(i) financial statements of the Company and its Subsidiaries for each such fiscal year, audited by independent certified public accountants reasonably acceptable to Purchaser setting forth in each case in comparative form the figures for the previous year, reported on without a “going concern” or like qualification or exception, or qualification arising out of the scope of the audit and certified by such accountants to have been prepared in accordance with GAAP (such audited financial statements to include a balance sheet, income statement, and statement of cash flow and, any such accountants’ letter to management (whether in draft or final form) received by any Credit Party or any of its Subsidiaries and the management’s responses thereto;

(ii) a Compliance Certificate demonstrating, in reasonable detail, compliance at the end of such fiscal year with the financial covenants contained in Section 9.18.

The report required by this Section 8.3(b) shall be deemed timely delivered hereunder if and to the extent the Company avails itself of the extension provided by the Exchange Act Rule 12b-25 so long as such report is filed on or before the applicable filing date as so extended.

(c) Projections.

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(i) as soon as available, but in any event at least thirty (30) days prior to the start of each fiscal year of the Company for one-year projections and by the end of the previous fiscal year of the Company for three-year projections, copies of the Credit Parties’ Projections, all prepared on a consistent basis with the Credit Parties’ historical financial statements, together with appropriate supporting details and a statement of underlying assumptions, in form and substance (including as to scope and underlying assumptions) reasonably satisfactory to Purchaser for the forthcoming fiscal year, quarter by quarter, or the forthcoming three(3) years, year by year, as applicable, in each case certified by the Chief Financial Officer of the Company as being such officer’s good faith best estimate of the financial performance of the Company and its Subsidiaries during the period covered thereby; and

(ii) within forty-five (45) days after the end of each of the first three fiscal quarters of the Company’s fiscal year (or such shorter period as the as the SEC shall require from time to time with respect to the filing by a reporting company of a Quarterly Report on Form 10-Q), and within ninety (90) days after the end of the fourth fiscal quarter of the Company’s fiscal year (or such shorter period as the SEC shall require from time to time with respect to the filing by a reporting company of Form 10-K annual reports), a narrative discussion and analysis of the financial condition and results of operations of the Company and its Subsidiaries for such fiscal quarter and for the period from the beginning of the then current fiscal year to the end of such fiscal quarter, as compared to the portion of the Projections covering such periods and to the comparable periods of the previous year. The information required by this clause (ii) shall be deemed adequately and timely provided so long as contained in the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operation” contained within the Company’s annual or quarterly report, as the case may be, so long as the same is timely filed as provided under the rules of the Exchange Act (including as extended by Rule 12b-25 thereof).

(d) SEC Reports and Other Information. If and when filed by any Credit Party:

(i) Form 10-Q quarterly reports, Form 10-K annual reports, and Form 8-K current reports,

(ii) any other filings made by any Credit Party with the SEC or other filings or correspondence with NASD or the Nasdaq National Market,

(iii) copies of the Credit Parties’ federal income Tax returns, and any amendments thereto, filed with the Internal Revenue Service,

(iv) press releases relating to any Credit Party, prior to or concurrently with the issuance thereof, and

(v) any other information that is provided by the Company to its shareholders generally.

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The deliveries contemplated by this Section 8.3(d) may, at the Company’s option, be made if the same is filed electronically with the SEC or otherwise publicly available and the Company provides Purchaser with the relevant location data.

(e) If and when filed by any Credit Party and as requested by Purchaser, satisfactory evidence of payment of applicable excise Taxes in each jurisdiction in which (i) any Credit Party conducts business or is required to pay any such excise Tax, (ii) where any Credit Party’s failure to pay any such applicable excise Tax would result in a Lien on the properties or assets of any Credit Party, or (iii) where any Credit Party’s failure to pay any such applicable excise Tax reasonably could be expected to result in a Material Adverse Change.

(f) As soon as a Credit Party has knowledge of any event or condition that constitutes a Default or an Event of Default or that could be expected to result in a Material Adverse Change, written notice thereof and a statement of the curative action that the Credit Parties have taken, are taking and propose to take with respect thereto.

(g) As soon as a Credit Party has knowledge of any pending or threatened action, suit or proceeding by any Person, or any pending or threatened investigations by a Governmental Authority that would reasonably be expected to result in a Material Adverse Change, written notice thereof and a statement of the curative action that the Credit Parties have taken, are taking and propose to take with respect thereto.

(h) As soon as a Credit Party has knowledge of any notice of any violation by any Credit Party of any Environmental Law that would reasonably be expected to result in a Material Adverse Change, written notice thereof and a statement of the curative action that the Credit Parties have taken, are taking and propose to take with respect thereto.

(i) Senior Credit Agreement; Existing Notes; Other Indebtedness.

(i) as and when delivered by the Company or any other Credit Party to the Senior Lender or any holder of the Existing Notes or any other Indebtedness of any Credit Party: (A) the schedules and reports required to be delivered under the terms of paragraph 11 of the Senior Credit Agreement or similar schedules or “Compliance Certificates” under the terms of the documents evidencing the Existing Notes or such other Indebtedness; and (B) projections, if any, required to be delivered under the terms of the Senior Credit Agreement or under the terms of the documents evidencing the Existing Notes or such other Indebtedness;

(ii) no later than ten (10) Business Days prior to the effectiveness thereof, copies of substantially final drafts of any proposed amendment, supplement, waiver or other modification with respect to the Senior Credit Documents or the Existing Notes;

(iii) on the date of the occurrence thereof, notice (A) that any or all of the obligations under the Senior Credit Documents, the Existing Notes or any other Indebtedness have been accelerated, (B) that the Senior Lender or any holder of the Existing Notes or such other Indebtedness has given notice that any or all such

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obligations are to be accelerated or (C) of any default or breach under the Senior Credit Documents, the Existing Notes or any other Indebtedness; and

(iv) to the extent not included in clauses (i) through (iii) above, no later than the date the same are required to be delivered thereunder, copies of all agreements, documents or other instruments (including, without limitation, (A) audited and unaudited, pro forma and other financial statements, reports, forecasts, and projections, together with any required certifications thereon by independent public auditors or officers of the Company or any of its Subsidiaries or otherwise, (B) press releases, (C) statements or reports furnished to any other holder of the securities of the Credit Parties or any of their respective Subsidiaries, and (D) regular, periodic and special securities reports) that the Company or any of its Subsidiaries are required to provide pursuant to the terms of the Senior Credit Documents or the Existing Notes.

(j) No later than ten (10) Business Days prior to the effectiveness thereof, copies of substantially final drafts of any proposed amendment, supplement, waiver or other modification with respect to the Governing Documents of any Credit Party or any of its Subsidiaries.

(k) As soon as possible and in any event within five (5) Business Days of obtaining knowledge thereof, any notice that any Governmental Authority may reject or condition approval of any material permit held by any Credit Party or any of its Subsidiaries, or any application for any material permit held by any Credit Party or any of its Subsidiaries on terms and conditions that are materially burdensome to such Person, or to the operation of any of its businesses or any property owned, leased or otherwise operated by such Person.

(l) So long as the Securities are “restricted securities” within the meaning of Rule 144(a)(3) under the Securities Act, and during any period in which it is not subject to and in compliance with Section 13 or Section 15(d) of the Exchange Act or is not exempt from such reporting requirements pursuant to and in compliance with Rule 12g3-2(b) under the Exchange Act, provide to Purchaser and to each prospective purchaser (as designated by Purchaser) of such restricted securities, upon the request of Purchaser or any prospective purchaser that represents its ability and qualifications to trade the securities under Rule 144A under the Securities Act, any information required to be provided by Rule 144A(d)(4) under the Securities Act (this covenant being intended for the benefit of Purchaser, and the prospective purchasers designated by Purchaser, from time to time of such restricted securities).

In addition to the financial statements referred to above, the Credit Parties agree to deliver financial statements prepared on both a consolidated and consolidating basis and that except as permitted by GAAP and by Regulation S-X, no Credit Party, or any Subsidiary of a Credit Party, will have a fiscal year different from that of the Company. The Credit Parties agree that their independent certified public accountants are authorized to communicate with Purchaser and to release to Purchaser, at the Credit Parties’ expense up to $5,000 per fiscal year, if no Event of Default has occurred and is continuing, or at the Credit Parties’ sole expense, if an Event of Default has occurred and is continuing, whatever financial information concerning the Credit Parties that Purchaser reasonably may request. Each Credit Party waives the right to assert a confidential relationship, if any, it may have with any accounting firm or service bureau in connection with any information requested by Purchaser pursuant to or in accordance with this

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Agreement, and agrees that Purchaser may contact directly any such accounting firm or service bureau in order to obtain such information.

8.4 Credit Party Reports. Cause each other Credit Party to deliver its annual financial statements (if not consolidated with the Company’s annual financial statement filed with its annual report on Form 10-K) at the time when the Company provides its audited financial statements to Purchaser and copies of all federal income Tax returns as soon as the same are available and in any event no later than thirty (30) days after the same are required to be filed by law.

8.5 Maintenance of Properties, etc.

(a) Maintain and preserve all of its material Properties which are necessary or useful in the proper conduct of its business in good working order and condition, ordinary wear and tear excepted, and comply at all times with the provisions of all leases to which it is a party as lessee, so as to prevent any loss or forfeiture thereof or thereunder.

(b) Maintain ownership of the shares of Equity of each Subsidiary as set forth in Schedule 5.5(c).

8.6 Taxes.

(a) Cause all assessments and Taxes, whether real, personal, or otherwise, due or payable by, or imposed, levied, or assessed against the Credit Parties or any of their assets to be paid in full, before delinquency or before the expiration of any extension period, except to the extent that the validity of such assessment or Tax shall be the subject of a Permitted Protest. The Credit Parties shall make timely payment or deposit of all Tax payments and withholding Taxes required of it by applicable laws, including those laws concerning F.I.C.A., F.U.T.A., state disability, and local, state, and federal income taxes, and will, upon request, furnish Purchaser with proof satisfactory to Purchaser indicating that the applicable Credit Party has made such payments or deposits. Upon request by Purchaser to the Company, the Credit Parties shall deliver satisfactory evidence of payment of applicable excise Taxes in each jurisdiction in which any Credit Party is required to pay any such excise Tax.

(b) Promptly notify Purchaser in writing upon receipt of notice of any material pending or threatened federal, state, local or foreign Tax audits or assessments relating to the income, properties or operations of the Credit Parties and permit Purchaser to participate fully to the extent allowed by law, in any proceedings relating to any such audits or assessments (including, without limitation, not resolving any such matters without the prior written consent of Purchaser, which consent shall not be unreasonably withheld).

(c) Pay all Transfer Taxes (together in each case with interest and penalties, if any) payable or determined to be payable in connection with the execution and delivery of this Agreement or the issuance and sale of the Securities and shall hold harmless Purchaser from and against any and all liabilities with respect to or resulting from any delay in paying, or omission to pay, such Taxes.

8.7 Insurance.

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(a) At each of the Credit Parties’ sole expense, maintain insurance respecting its property and assets wherever located, covering loss or damage by fire, theft, explosion, terrorism, and all other hazards and risks as ordinarily are, from time to time, insured against by other Persons engaged in the same or similar businesses in the same general geographic area as such Credit Party. All such policies of insurance shall be in such amounts, against such risks and subject to such deductibles, and with such financially sound and reputable insurance companies as are reasonably satisfactory to Purchaser (and which, if acceptable to Senior Lender, shall be deemed to be reasonably satisfactory to Purchaser); provided that in any event each of the Credit Parties will maintain (i) property and casualty insurance on all Property on an all risks basis (including the perils of flood, loss by fire, explosion, and theft and such other risks and hazards as are covered by a standard extended coverage insurance policy), covering the repair or replacement cost of all such Property and consequential loss coverage for business interruption and extra expense (which shall include construction expenses and such other business interruption expenses as are otherwise generally available to similar businesses), (ii) public liability insurance, and (iii) building law and ordinance coverage in such amount as to address to the satisfaction of Purchaser any increased cost of construction, debris removal and/or demolition expenses incurred as a result of the application of any building law and/or ordinance. All such insurance with respect to each of the Credit Parties shall be provided by insurers or reinsurers which (x) in the case of United States insurers and reinsurers, have an A.M. Best policyholders rating of not less than A- with respect to primary insurance and B+ with respect to excess insurance and (y) in the case of non-United States insurers and reinsurers, the providers of at least eighty percent (80%) of such insurance have either an ISI policyholders rating of not less than A, an A.M. Best policyholders rating of not less than A- or a surplus of not less than $500,000,000 with respect to primary insurance, and an ISI policyholders rating of not less than BBB with respect to excess insurance, or, if the relevant insurance is not available from such insurers, such other insurers as Purchaser may approve in writing. All insurance shall (1) provide that no cancellation, material reduction in amount or material change in coverage thereof shall be effective until at least thirty (30) days after receipt by Purchaser of written notice thereof, (2) if reasonably requested by Purchaser, include a breach of warranty clause, (3) contain a “Replacement Cost Endorsement” with a waiver of depreciation and a waiver of subrogation against Purchaser, (4) contain endorsements providing that none of the Credit Parties, Purchaser, the Collateral Agent or any other Person shall be a co-insurer under such insurance policies, and (5) be reasonably satisfactory in all material respects to Purchaser. The Collateral Agent shall be named as an additional insured on all liability insurance policies of each Credit Party and the Collateral Agent shall be named as a loss payee on all property and casualty insurance policies of each such Person. The Credit Parties shall deliver copies of all such policies to Purchaser. Each policy of insurance or endorsement shall contain a clause requiring the insurer to give not less than thirty (30) days prior written notice to the Collateral Agent in the event of cancellation of the policy for any reason whatsoever.

(b) Give the Collateral Agent prompt notice of any loss in excess of $100,000 covered by the insurance policies described in clause (a) above. Purchaser shall have the right (subject to the consent of the relevant Credit Party’s insurer and that of the Senior Lender) to adjust any losses payable under any such insurance policies in excess of $250,000, without any liability to the Credit Parties whatsoever in respect of such adjustments. Any monies received as payment for any loss under any insurance policy mentioned above (other than liability insurance policies) or as payment of any award or compensation for condemnation or

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taking by eminent domain, shall be paid over to the Collateral Agent to be applied, subject to the Intercreditor Agreement, at the Collateral Agent’s option either to the prepayment of the Obligations or shall be disbursed to the Company under staged payment terms reasonably satisfactory to Purchaser for application to the cost of repairs, replacements, or restorations; provided, that the Collateral Agent shall disburse such proceeds to the Company (under staged payment terms as provided above) so long as (i) no Event of Default shall have occurred and be continuing and (ii) the affected Credit Party shall provide the Collateral Agent with reasonably detailed plans respecting the costs and methods of repairs, replacements or restorations. Any such repairs, replacements, or restorations shall be effected with reasonable promptness and shall be of a value at least equal to the value of the items or property destroyed prior to such damage or destruction.

(c) Not take out separate insurance concurrent in form or contributing in the event of loss with that required to be maintained under this Section 8.7, unless the Collateral Agent is included thereon as named insured with the loss payable to the Collateral Agent under a lender’s loss payable endorsement or its equivalent. The Company immediately shall notify the Collateral Agent whenever such separate insurance is taken out, specifying the insurer thereunder and full particulars as to the policies evidencing the same, and copies of such policies promptly shall be provided to the Collateral Agent.

(d) At the Credit Parties’ sole expense, maintain directors’ and officers’ liability insurance in respect of any director appointed by Purchaser to the Company’s Board of Directors in accordance with Section 8.15, with the same insurer, in the same amount, on the same terms and conditions and with the same deductibles as are applicable to all other directors on the Company’s Board of Directors, the amounts, terms, conditions and deductibles of which shall at all times be comparable to directors’ and officers’ liability insurance maintained by businesses similarly situated to the Company.

(e) Commencing on June 30, 2005 and at the end of each second fiscal year of the Company thereafter, provide Purchaser with a biennial report of an insurance broker of national standing reasonably satisfactory to Purchaser as to the adequacy of the amounts and types of insurance maintained by the Credit Parties and, at the request of Purchaser, obtain and maintain any amount and type of insurance recommended in such report which such Credit Parties have not already obtained and maintained.

8.8 Location of Collateral. Keep the Collateral only at the locations identified on Schedule 5.3 and provide the Collateral Agent Collateral Access Agreements for such locations (if such locations are leased and not owned by the Credit Parties); provided, however, that the Company may amend Schedule 5.3 so long as such amendment occurs by written notice to the Collateral Agent not less than thirty (30) days prior to the date on which the Inventory or Equipment is moved to such new location, so long as such new location is within the continental United States (if originally so located), and so long as, at the time of such written notification, the applicable Credit Party provides any financing statements or fixture filings necessary to perfect and continue perfected the Collateral Agent’s and Purchaser’s Liens on such assets and also provides to the Collateral Agent a Collateral Access Agreement.

8.9 Compliance with Laws. Comply with the requirements of all applicable laws, rules, regulations, and orders of any Governmental Authority (including without limitation,

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the SEC, the Environmental Protection Agency, Air Quality Management Districts and local fire departments), including, without limitation, the Fair Labor Standards Act, the Americans With Disabilities Act, the Securities Act, the Exchange Act and the Foreign Corrupt Practices Act.

8.10 Leases. Pay when due all rents and other amounts payable under any leases to which any Credit Party is a party or by which any Credit Party’s properties and assets are bound, unless such payments are the subject of a Permitted Protest.

8.11 Brokerage Commissions. Pay any and all brokerage commission or finders fees incurred in connection with or as a result of the Credit Parties’ obtaining financing under this Agreement. The Credit Parties agree and acknowledge that payment of all such brokerage commissions or finders fees shall be the sole responsibility of the Credit Parties, and each Credit Party agrees to indemnify, defend, and hold Purchaser harmless from and against any claim of any broker or finder arising out of the Credit Parties’ obtaining financing under this Agreement.

8.12 Conduct of Business and Maintenance of Existence, etc. (a) (i) Preserve, renew and keep in full force and effect its limited liability company or corporate existence and (ii) take all reasonable action to maintain all rights, privileges and franchises necessary or desirable in the normal conduct of its business, except, in the case of clause (ii) above, to the extent that failure to do so could not reasonably be expected to result in a Material Adverse Change; and (b) comply with all Contractual Obligations and Requirements of Law except to the extent that failure to comply therewith could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Change.

8.13 Environmental. (a) Keep any property either owned or operated by any Credit Party free of any Environmental Liens or post bonds or other financial assurances sufficient to satisfy the obligations or liability evidenced by such Environmental Liens, (b) comply, in all material respects, with Environmental Laws and provide to Purchaser documentation of such compliance which the Purchaser reasonably requests, (c) promptly notify Purchaser of any release of a Hazardous Material of any reportable quantity from or onto property owned or operated by any Credit Party and take any Remedial Actions required to abate said release or otherwise to come into compliance with applicable Environmental Law, and (d) promptly provide Purchaser with written notice within ten (10) days of the receipt of any of the following: (i) notice that an Environmental Lien has been filed against any of the real or personal property of any Credit Party, (ii) commencement of any Environmental Action or notice that an Environmental Action will be filed against any Credit Party, and (iii) notice of a violation, citation, or other administrative order which reasonably could be expected to result in a Material Adverse Change.

8.14 Disclosure Updates. Promptly and in no event later than five (5) Business Days after obtaining knowledge thereof, (a) notify Purchaser if any written information, exhibit, or report furnished to Purchaser contained any untrue statement of a material fact or omitted to state any material fact necessary to make the statements contained therein not misleading in light of the circumstances in which made, and (b) without limiting any liability therefore, correct any defect or error that may be discovered therein or in any Transaction Document or in the execution, acknowledgement, filing, or recordation thereof.

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8.15 Monitoring Rights.

(a) Board Attendance. At any time while the Note remains outstanding, give Purchaser, notice of (in the same manner as notice is given to directors or stockholders, as the case may be, but not less than forty-eight (48) hours prior to such meeting unless otherwise agreed to by Purchaser in advance and in writing) meetings of the Board of Directors (or equivalent body) or any committee thereof of the Company and all meetings of the Company’s stockholders called by the Company and permit one Person designated by Purchaser (the “Purchaser Representative”) to participate in and monitor such meetings of the Company. Purchaser shall be provided with copies of (i) a meeting agenda, if any is prepared, (ii) all information that is provided to the members of the Board of Directors (or equivalent body) or any committee thereof of the Company or to the stockholders of the Company (whether prior to, at, or subsequent to any such meetings), and access thereto, as the case may be, at the same time as such materials are provided to the members of the Board of Directors (or equivalent body) or any committee thereof of the Company or to the stockholders of the Company, as the case may be, and (iii) the minutes of all meetings of the Board of Directors (or equivalent body) and any committee thereof of the Company and of all meetings of stockholders of the Company concurrently with the distribution of such minutes to one or more members of the Board of Directors (or equivalent body) or any committee thereof of the Company or stockholders of the Company, as the case may be, but in no event later than forty-five (45) days after each such meeting. The reasonable travel and/or monitoring expenses incurred by any Person designated by Purchaser in attending any board or committee meetings shall be reimbursed by the Company to the extent consistent with the then existing policy of the Company of reimbursing directors generally for such expenses.

(b) Monthly Operating Meetings. In each calendar month after the Closing Date, cause its Representatives to meet with Representatives of Bison Capital to review the financial condition of the Company and its Subsidiaries as reflected in the financial information furnished pursuant to Sections 8.2 and 8.3. Each meeting shall at all times be comprised of at least one (1) Executive Officer of the Company and two (2) individuals designated by Bison Capital (who initially shall be James K. Hunt and Douglas B. Trussler). The financial officers and other members of senior management of the Company shall be available at each meeting to review financial information and discuss other matters. Bison Capital and the Company shall mutually agree in each calendar month on the date and time for the meeting to be held in the immediately succeeding calendar month; provided, that the failure to agree on such date and time in any month shall not be construed as an agreement not to hold a meeting in the immediately succeeding month. Meetings may be conducted by telephone so long as each of the persons attending can hear each of the other persons attending the meeting.

8.16 Reservation of Shares of Equity of the Company. The Company shall at all times reserve and keep available out of its authorized Equity, solely for the purpose of issuance or delivery upon exercise of the Warrant, the maximum number of shares of Equity of the Company that may be issuable or deliverable upon such exercise (the “Warrant Securities”). The Warrant Securities shall, when issued or delivered in accordance with the Warrant be duly and validly issued and fully paid and non-assessable and free and clear of any Liens or adverse claims and shall not be subject to preemptive rights in favor of any Person. The Company shall

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issue such Warrant Securities in accordance with the provisions of the Warrant and shall otherwise comply with the terms thereof.

8.17 ERISA Matters.

(a) Cause each Benefit Plan to be operated in compliance with the terms of such Benefit Plan and applicable law and shall pay and discharge promptly any liability imposed upon it or them pursuant to the provisions of such Benefit Plan and applicable law; provided, however, that no Credit Party shall be required to pay any such liability if (i) the amount, applicability, or validity thereof shall be diligently contested in good faith by appropriate proceedings and (ii) such Person shall have set aside on its books reserves which, in the good faith judgment of the board of directors of such Person, are adequate with respect thereto.

(b) Deliver to Purchaser promptly, but in no event more than five (5) Business Days after any officer of any Credit Party obtains knowledge of (i) the Internal Revenue Service’s (A) revocation of, or intent to revoke, the Tax-qualified status of any Benefit Plan, (B) imposition of an excise Tax upon the occurrence of a “prohibited transaction” as such term is defined in Section 4975 of the Code, or (C) disallowance of a deduction (in whole or in part) for a contribution to a Benefit Plan, (ii) the institution of a lawsuit against a Benefit Plan (or a Fiduciary of such plan), or (iii) the United Stated Department of Labor’s imposition of a penalty under Section 502 of ERISA relating to a Benefit Plan, a written notice specifying the nature of such action, what action has been taken, is being taken, or is proposed to be taken with respect thereto, and a copy of any correspondence or other documentation relating to the matter.

(c) Deliver to Purchaser promptly, but in no event more than five (5) Business Days after any officer of any Credit Party obtains knowledge thereof, written notice of (i) the occurrence of a Termination Event, (ii) any fact arising in connection with any Benefit Plan that could constitute grounds for the termination thereof by the PBGC or for the appointment of a trustee to administer the Benefit Plan or that might otherwise result in material liability to the PBGC, (iii) any Benefit Plan failing to have sufficient assets to qualify for a standard termination under Section 4041 of ERISA, (iv) the imposition of any withdrawal liability on any Credit Party with respect to a Multiemployer Plan, (v) a determination that a Multiemployer Plan in which a Credit Party participates is, or is expected to be, in reorganization within the meaning of Title IV of ERISA, (vi) the termination of a Multiemployer Plan in which a Credit Party participates, or (vii) the filing of a request for a waiver of the minimum funding standard with regard to any Benefit Plan to which such standard applies.

(d) Upon request by Purchaser, furnish to Purchaser copies of: (i) each Schedule B (Actuarial Information) to the annual report (Form 5500 Series) filed by any Credit Party or any ERISA Affiliate with the Internal Revenue Service with respect to each Benefit Plan; (ii) the most recent actuarial valuation report for each Benefit Plan; (iii) all notices received by any Credit Party or any ERISA Affiliate from a Multiemployer Plan sponsor or any governmental agency concerning a Termination Event; and (iv) such other documents or governmental reports or filings relating to any Benefit Plan as Purchaser shall reasonably request.

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8.18 Payment of Obligations. Pay, discharge or otherwise satisfy at or before maturity or before they become delinquent, as the case may be, all its material obligations of whatever nature, except where the amount or validity thereof is currently being contested in good faith by appropriate proceedings and reserves in conformity with GAAP with respect thereto have been provided on the books of the Credit Parties.

8.19 Inspection of Property; Books and Records; Discussions. (a) Keep proper books of records and account in which full, true and correct entries in conformity with GAAP and all Requirements of Law shall be made of all dealings and transactions in relation to its business and activities, (b) permit Representatives of the Collateral Agent and representative of Purchaser to visit and inspect any of its properties and examine and, at the Credit Parties’ expense, and make abstracts from any of its books and records, at the Credit Parties’ expense up to $5,000, if no Event of Default has occurred and is continuing, or at the Credit Parties’ sole expense, if an Event of Default has occurred and is continuing, at any reasonable time and as often as may reasonably be desired and to discuss the business, operations, properties and financial and other condition of the Credit Parties with officers and employees of such Credit Parties and with their respective independent certified public accountants and (c) permit representatives of the Collateral Agent and Purchaser to consult from time to time with management of the Credit Parties at their respective places of business regarding operating and financial matters, including the right to consult with and advise management of the Credit Parties on significant business issues, including management’s proposed annual operating plans and to meet with the management of the Credit Parties at their facilities at mutually agreeable times for such consultation and advice and to review progress in achieving their operating plans.

8.20 Other Obligations. Perform and observe, and cause each of its Affiliates to perform and observe, each of the covenants and agreements required to be performed by such Person pursuant to, and in accordance with, (i) the Senior Credit Documents and (ii) the Existing Notes.

8.21 Additional Collateral, etc.

(a) With respect to any Property acquired after the Closing Date as to which the Collateral Agent and Purchaser do not have a perfected security interest with the priority required under the Transaction Documents, promptly (and in any event, within five (5) days following the date of such acquisition) (i) execute and deliver to the Collateral Agent and Purchaser such amendments to this Agreement or such other documents and modifications thereof as the Collateral Agent or Purchaser deem necessary or advisable to grant to the Collateral Agent and Purchaser a security interest in such Collateral and (ii) take all actions necessary or advisable to grant to the Collateral Agent and Purchaser a perfected first priority security interest in such Collateral, subject only to Permitted Liens, including without limitation, the filing of Uniform Commercial Code financing statements in such jurisdiction as may be required by this Agreement or by law or as may be requested by the Collateral Agent and Purchaser.

(b) Subject to Section 9.11, with respect to any new Subsidiary created or acquired after the Closing Date by any Credit Party, the Credit Parties shall cause such Subsidiary to promptly (and, in any event, within five (5) days following such creation or the date of such acquisition) (i) execute and deliver to the Collateral Agent and Purchaser a Joinder

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Agreement and such amendments to this Agreement as the Collateral Agent or Purchaser deems necessary or advisable to grant to the Collateral Agent and Purchaser a perfected first priority security interest, subject only to Permitted Liens, in the Equity of such new Subsidiary that is owned by such Credit Party; provided that, Foreign Subsidiaries shall not be required to execute and deliver a Joinder Agreement, (ii) deliver to the Collateral Agent a Stock Pledge Agreement, the certificates representing such Equity (provided that, with respect to any Foreign Subsidiary, so long as its jurisdiction of organization is outside the United States, in no event shall more than 66% of the Equity of any such Foreign Subsidiary be subject to any Lien or be required to be pledged under any Transaction Document to the extent that a pledge of more than 66% of such Equity would result in a material adverse Tax consequence for the Company), together with undated stock powers, in blank, executed and delivered by a duly authorized officer of such Credit Party, as the case may be, (iii) cause such new Subsidiary (other than Foreign Subsidiaries) (A) to become a party to this Agreement, the Security Agreement, the Intellectual Property Security Agreement and any other Transaction Document as Purchaser may request, (B) to take such actions necessary or advisable to grant to the Collateral Agent and Purchaser a perfected first priority security interest, subject only to Permitted Liens, in all Property described in this Agreement, the Security Agreement and the Intellectual Property Security Agreement with respect to such new Subsidiary, including, without limitation, the recording of instruments in the United States Patent and Trademark Office and the United States Copyright Office, the execution and delivery by all necessary Persons of Control Agreements and the filing of Uniform Commercial Code financing statements in such jurisdictions as may be required by this Agreement, the Intellectual Property Security Agreement or by law or as may be requested by the Collateral Agent or Purchaser and (C) evidence of proper corporate or other organizational authorization and legal opinions with respect to each of the matters set forth in this Section 8.21(b), which opinions shall be in form and substance, and from counsel, reasonably satisfactory to the Collateral Agent and Purchaser, and (iv) deliver to the Collateral Agent and Purchaser such other documentation as the Collateral Agent and Purchaser may require, in their sole discretion, in each case, in form and substance satisfactory to the Collateral Agent and Purchaser.

8.22 Stockholder Approval. In the event that stockholder approval is needed under the rules of the NASD or otherwise for the issuance or exercise of any of the Securities, use its reasonable best efforts to file with the SEC, not later than thirty (30) Business Days following the Closing Date (or, if later, the date of the event triggering the stockholder approval requirement) a preliminary proxy statement (the “Preliminary Proxy”) on Schedule 14A in connection with a special meeting of the Company’s stockholders to approve the issuance of the Securities pursuant to this Agreement, and the issuance of shares of Common Stock upon the exercise of the Warrant (the “Stockholder Proposal”). Promptly following the approval by the SEC of the Preliminary Proxy or, if the SEC does not review the Preliminary Proxy, the tenth (10^th) calendar day after filing the Preliminary Proxy with the SEC (or if such day is not a Business Day, then the next Business Day), the Company shall use its reasonable best efforts to commence distribution to the Company’s stockholders of record of a definitive proxy statement related to the Stockholder Proposal. The Company agrees to use its best efforts to obtain stockholder approval of the Stockholder Proposal. Promptly following the special meeting of the stockholders, the Company shall notify Purchaser in writing of the results of the vote of the stockholders on the Stockholder Proposal. The Company agrees that the definitive proxy statement distributed pursuant to this Section 8.22 will as of its mailing and as of the date of the

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special meeting of the stockholders (i) comply as to form with the requirements of Schedule 14A under the Exchange Act, and (ii) not be in violation of Rule 14a-9 of the Exchange Act.

8.23 Further Assurances. From time to time execute and deliver, or cause to be executed and delivered, such additional instruments, certificates or documents, and take all such actions, as Purchaser may reasonably request, for the purposes of implementing or effectuating the provisions of this Agreement and the other Transaction Documents or more fully perfecting or renewing the rights of the Collateral Agent and Purchaser with respect to the Collateral (or with respect to any additions thereto or replacements or proceeds or products thereof or with respect to any other property or assets hereafter acquired by any Credit Party which may be deemed to be part of the Collateral) pursuant hereto or thereto. Upon the exercise by the Collateral Agent and Purchaser of any power, right, privilege or remedy pursuant to this Agreement or the other Transaction Documents which requires any consent, approval, recording, qualification or authorization of any Governmental Authority, each Credit Party will execute and deliver, or will cause the execution and delivery of, all applications, certifications, instruments and other documents and papers that the Collateral Agent and Purchaser may be required to obtain from such Credit Party for such governmental consent, approval, recording, qualification or authorization.

8.24 Lost, etc. Certificates Evidencing Warrant Securities; Exchange. Upon notice by the Collateral Agent or Purchaser that any certificate representing the Warrant Securities has been mutilated, lost, stolen or destroyed, the Company shall promptly (and in no event later than five (5) days after such notice), replace and deliver such certificate to the Collateral Agent, as designated in such notice; provided, however, that the Company receives evidence reasonably satisfactory to the Company of such mutilation, loss, theft or destruction of such certificate and provided, further that if such certificate has been mutilated, the Collateral Agent shall deliver such mutilated certificate to the Company in exchange for the replacement certificate. The Company shall pay for all out-of-pocket costs and expenses related to the replacement and delivery of such certificate (including the cost of insurance against lost or theft in an amount satisfactory to the Collateral Agent).

8.25 Transactions with General Electric Company or its Affiliates. Except as set forth in Schedule 5.26, the Company shall provide GE Asset Management Incorporated written notice no less than fifteen (15) days prior to the occurrence, to its knowledge, of any of the following events: (i) the issuance by any Credit Party of any securities (including, without limitation, any capital stock or notes, debentures or other indebtedness, exchangeable for capital stock) of such Credit Party to General Electric Company or any of its Subsidiaries or Affiliates, or (ii) the grant by any Credit Party of any options, warrants or other rights to acquire any securities of such Credit Party to General Electric Company or any of its Subsidiaries or Affiliates.

8.26 BRC Financial Audit. The Company shall complete a financial audit for BRC for each of the last two (2) fiscal years and deliver such audits to Purchaser, in form and substance reasonably satisfactory to Purchaser within sixty (60) days of the Closing Date.

8.27 BRC Financial Forecasts. The Company shall deliver to Purchaser within sixty (60) days of the Closing Date financial forecasts for fiscal years 2004-2007 of BRC which are prepared by BRC and certified by the principal financial officer of BRC.

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8.28 Nasdaq National Stock Market. The Common Stock shall at all times be listed for trading on the Nasdaq National Market.

8.29 Chief Executive Officer. The Company shall cause Robert M. Stemmler (or one or more successors reasonably satisfactory to Purchaser) to hold the office of Chief Executive Officer of the Company and to spend ninety-five percent (95%) of his employment time, attention and best efforts to the business of the Company.

8.30 Obtain Consents for Pledge of Joint Ventures. The Company shall obtain all of the necessary consents and other documentation to effectuate the pledge of the Equity of each of CNGC-IMPCO Technologies, LLC, MINDA IMPCO Technologies, Ltd. and MINDA IMPCO Ltd. to the Collateral Agent, for the benefit of the Collateral Agent and Purchaser within ninety (90) days of the Closing Date; provided that in the case of consents from any Governmental Authority, the Company shall use best efforts to obtain such consents.

ARTICLE 9

NEGATIVE COVENANTS

Until the payment and performance in full in immediately available funds of all Obligations under the Transaction Documents, each Credit Party hereby covenants and agrees, jointly and severally, that it shall not, and shall not cause or permit any of its Subsidiaries (including BRC for purposes of this Article 9, and BRC shall be deemed a Subsidiary for purposes of this Article 9) to:

9.1 Indebtedness. Create, incur, assume, permit, guarantee, or otherwise become or remain, directly or indirectly, liable with respect to any Indebtedness, except:

(a) Indebtedness evidenced by this Agreement and the other Transaction Documents;

(b) Indebtedness set forth on Schedule 5.16 existing as of the date hereof;

(c) Permitted Purchase Money Indebtedness;

(d) Indebtedness under the Senior Credit Agreement, in a principal amount not to exceed $12,000,000 in the aggregate for such Indebtedness; and

(e) refinancings, renewals, or extensions of Indebtedness permitted under clauses (a), (b), (c) and (d) of this Section 9.1 (and continuance or renewal of any Permitted Liens associated therewith) so long as: (i) the terms and conditions of such refinancings, renewals, or extensions do not, in Purchaser’s reasonable judgment, materially impair the prospects of repayment of the Obligations by the Credit Parties or materially impair the Credit Parties’ creditworthiness, (ii) such refinancings, renewals, or extensions do not result in an increase in the principal amount of, or interest rate or fees with respect to, the Indebtedness so refinanced, renewed, or extended; provided that the applicable Credit Party may incur such Indebtedness relating to refinancings, renewals, or extensions that result only in an increase in

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the interest rate or the closing fee with respect to the Indebtedness (reasonably consistent with the interest rates and closing fees required by the market for such Indebtedness at such time) with the prior written consent of Purchaser, which consent shall not be unreasonably withheld, (iii) such refinancings, renewals, or extensions do not result in a material shortening of the average weighted life to maturity of the Indebtedness so refinanced, renewed, or extended, nor are they on terms or conditions, that, taken as a whole, are more burdensome or restrictive to the applicable Credit Party than the Indebtedness so refinanced, renewed or extended, (iv) the obligor under the Indebtedness incurred under this Section 9.1(e) is the Company or the applicable Subsidiary that is the obligor on the Indebtedness being refinanced, renewed or extended and (v) if the Indebtedness that is refinanced, renewed, or extended was subordinated in right of payment to the Obligations, then the terms and conditions of the refinancing, renewal, or extension Indebtedness must be include subordination terms and conditions that are at least as favorable to Purchaser as those that were applicable to the refinanced, renewed, or extended Indebtedness.

9.2 Liens. Create, incur, assume, or permit to exist, directly or indirectly, any Lien on or with respect to any of its Property or assets, of any kind, whether now owned or hereafter acquired, or any income or profits therefrom, except for (each, a “Permitted Lien”):

(a) Liens held by the Collateral Agent securing the Obligations under the Transaction Documents;

(b) Liens for unpaid Taxes that either (i) are not yet delinquent, or (ii) do not constitute an Event of Default hereunder and are the subject of Permitted Protests;

(c) Liens set forth on Schedule 9.2 securing Indebtedness permitted under Section 9.1 (other than clauses (c) and (e) thereof);

(d) Purchase money Liens or the interests of lessors under Capital Leases to the extent that such Liens or interests secure Permitted Purchase Money Indebtedness and so long as (i) such Liens attach only to the asset purchased or acquired and the proceeds thereof, (ii) the Indebtedness secured thereby does not exceed the purchase price of the asset purchased or acquired and is not thereafter increased, (iii) such Liens are created substantially simultaneously with the acquisition of such asset and (iv) the amount of the Indebtedness secured thereby does not exceed $1,000,000 in the aggregate at any time;

(e) Liens arising by operation of law in favor of warehousemen, landlords, carriers, mechanics, materialmen, laborers, or suppliers, incurred in the ordinary course of business and not in connection with the borrowing of money, and which Liens either (i) are for sums not yet delinquent or (ii) are the subject of Permitted Protests;

(f) Liens arising from deposits made in connection with obtaining worker’s compensation or other unemployment insurance;

(g) Liens or deposits to secure performance of bids, tenders, or leases incurred in the ordinary course of business in the aggregate not to exceed $50,000 at any time outstanding and not in connection with the borrowing of money;

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(h) Liens granted as security for surety or appeal bonds in connection with obtaining such bonds in the ordinary course of business, in the aggregate not to exceed $50,000 at any time outstanding;

(i) With respect to any real property that is not part of the Collateral, easements, rights of way, and zoning restrictions that do not materially interfere with or impair the use or operation thereof; and

(j) Liens that are replacements of Permitted Liens to the extent that (i) the original Indebtedness is refinanced, renewed, or extended under Section 9.1(e), (ii) the replacement Liens only encumber those assets that secured the refinanced, renewed, or extended Indebtedness, (iii) the amount of the Indebtedness or other obligations secured thereby is not greater than the amount of the original Indebtedness and (iv) the Person granting the replacement Lien is the same Person that granted the Lien being replaced.

9.3 Restrictions on Fundamental Changes. Except as set forth on Schedule 9.3:

(a) Enter into any merger, consolidation, reorganization, or recapitalization, or reclassify its Equity.

(b) Liquidate, wind up, or dissolve itself (or suffer any liquidation or dissolution).

(c) Convey, sell, lease, license, assign, transfer, or otherwise dispose of, directly or indirectly (whether structured as a sale, lease, leaseback or otherwise), in one transaction or a series of transactions, any part of its assets or businesses, whether by way of merger, consolidation, tender offer, exchange offer, liquidation, dissolution, joint venture, purchase, recapitalization or similar transaction or otherwise, other than Permitted Dispositions.

(d) Cause, permit or suffer, directly or indirectly, any Change of Control.

9.4 Change Name. Change any Credit Party’s name, FEIN, organizational structure, identity, or jurisdiction of organization, cease to be a “registered organization” within the meaning of Section 9-307 of the UCC or add any new fictitious name; provided, however, that a Credit Party may change its name upon at least thirty (30) days’ prior written notice by the Company to the Collateral Agent of such change and so long as, at the time of such written notification, such Credit Party provides any financing statements necessary to perfect and continue perfected Purchaser’s Liens, with the priority required under the Transaction Documents.

9.5 Guarantee. (a) Guarantee or otherwise become in any way liable with respect to any Contingent Obligations except (i) by endorsement of instruments or items of payment for deposit to the account of the Credit Parties or which are transmitted or turned over to Purchaser, (ii) any Guarantees pursuant to the Transaction Documents, (iii) any Guarantees pursuant to the Senior Credit Documents and Existing Notes as in effect on the date hereof, of the Indebtedness of the Credit Parties thereunder or (iv) any warranties provided to customers in

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the ordinary course of a Credit Party’s business in connection with such Credit Party’s products and (b) without limiting the foregoing, permit any of its Affiliates to guarantee or otherwise become in any way liable with respect to any Indebtedness or Contingent Obligations secured by “margin stock” (within the meaning of Regulation U).

9.6 Nature of Business. Enter into or engage in any business, either directly or indirectly, except for those businesses in which the Credit Parties are engaged on the date hereof or that are reasonably related and ancillary thereto. Employ persons other than with respect to positions with responsibilities and duties directly related to the core operations of the business in which the Credit Parties are engaged on the Closing Date.

9.7 Prepayments and Amendments.

(a) Except in connection with a refinancing permitted by Section 9.1(e), prepay, redeem, defease, purchase, or otherwise acquire any Indebtedness of any Credit Party, other than the Obligations in accordance with this Agreement; and

(b) Except in connection with a refinancing permitted by and consistent with Section 9.1(e), directly or indirectly, amend, modify, alter, increase, or change any of the terms or conditions of any agreement, instrument, document, indenture, or other writing evidencing or concerning Indebtedness permitted under Section 9.1(b) or Section 9.1(c).

9.8 Consignments. Consign any Inventory or sell any Inventory on bill and hold, sale or return, sale on approval, or other conditional terms of sale.

9.9 Restricted Payments. Make any of the following, each of which shall be a “Restricted Payment”:

(a) Declare or pay any dividend or make any other payment or distribution on account of any Credit Party’s Equity (including, without limitation, any payment in connection with any merger or consolidation involving any Credit Party) or to the direct or indirect holders of any Credit Party’s Equity in any capacity (whether as a member, stockholder, manager, advisor or otherwise) other than dividends or other distributions to the Company from a Subsidiary of the Company;

(b) Make any payment on, or with respect to, assets set aside for a sinking or other analogous fund for the purchase, redemption, acquisition or retirement for value (including, without limitation, in connection with any merger or consolidation involving a Credit Party) of any Equity of any Credit Party or any direct or indirect parent of such Credit Party;

(c) Make any payment on or with respect to, or purchase, redeem, defease or otherwise acquire or retire for value any Indebtedness that is pari passu with or subordinated to the Note, except a payment of interest or principal at the stated maturity thereof; or

(d) Enter into any derivatives or other transaction with any financial institution, commodities or stock exchange or clearinghouse (a “Derivatives Counterparty”)

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obligating any Credit Party or any of its Subsidiaries to make payments to such Derivatives Counterparty as a result of any change in the value of any such security.

9.10 Accounting Methods. Modify or change its method of accounting (other than as may be required to conform to GAAP) or enter into, modify, or terminate any agreement currently existing, or at any time hereafter entered into with any third party accounting firm or service bureau for the preparation or storage of the Credit Parties’ accounting records without said accounting firm or service bureau agreeing to provide the Collateral Agent and Purchaser information regarding the Collateral or the Credit Parties’ financial condition.

9.11 Investments; Acquisitions; Subsidiaries.

(a) Except for Permitted Investments, directly or indirectly, make or acquire any Investment, or incur any liabilities (including contingent obligations) for or in connection with any Investment; provided, however, that the Credit Parties and their Subsidiaries (other than BRC) shall not have Permitted Investments in deposit accounts or Securities Accounts in excess of $1,000,000 in the aggregate outstanding at any one time unless the Collateral Agent and the applicable securities intermediary or bank have entered into Control Agreements or similar arrangements governing such Permitted Investments, as the Collateral Agent or Purchaser shall require or reasonably request, to perfect (and further establish) the Collateral Agent’s and Purchaser’s Liens in such Permitted Investments.

(b) Directly or indirectly purchase or otherwise acquire all or any substantial part of the business, assets or Equity of any Person, other than Permitted Acquisitions and as permitted under Section 9.11(c).

(c) Form or acquire any Subsidiaries unless:

(i) both before and after giving effect to such transaction no Default or Event of Default shall have occurred and be continuing;

(ii) Purchaser shall have received from the Credit Parties fifteen (15) days’ prior written notice (in the case of a domestic Subsidiary) or thirty (30) days’ prior written notice (in the case of a Foreign Subsidiary) of such transaction;

(iii) Purchaser shall have consented, in writing, to the formation or acquisition of such Subsidiary, which consent shall not unreasonably be withheld so long as such event is otherwise in compliance with this Section 9.11(c) and is not otherwise materially detrimental to the rights of Purchaser hereunder;

(iv) such Subsidiary (other than a Foreign Subsidiary) executes the Joinder Agreement pursuant to Section 8.21; and

(v) the Equity of such Subsidiary is pledged to the Collateral Agent for the benefit of the Collateral Agent and Purchaser pursuant to a Stock Pledge Agreement in accordance with Section 8.21.

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(d) Except for joint ventures set forth on Schedule 9.24, form or acquire any interests in an Affiliate or form any joint venture unless:

(i) Purchaser shall have received from the Credit Parties fifteen (15) days’ prior written notice (in the case of a domestic Affiliate or joint venture) or thirty (30) days’ prior written notice (in the case of a foreign Affiliate or joint venture) of such transaction; and

(ii) such transaction does not require the Credit Parties, individually or in the aggregate, to contribute, pay or otherwise incur liabilities (including, without limitation, any Indebtedness or Contingent Obligation), whether direct or indirect, in connection therewith, in excess of $200,000 individually or $500,000 in the aggregate.

9.12 Transactions with Affiliates. Directly or indirectly, pay any funds to or for the account of, extend credit to, make any Investment (whether by acquisition of stock or indebtedness, by loan, advance, transfer of property, guarantee or other agreement to pay, purchase or service, directly or indirectly, any debt, or otherwise) in, lease, sell, transfer or otherwise dispose of any Property, tangible or intangible, to, or participate in, or effect any transaction in connection with any joint enterprise or other joint arrangement with, any Affiliate except:

(a) as set forth on Schedule 9.12 (so long as each of the matters described on Schedule 9.12 has been approved by the Board of Directors of the Company and copies of the resolutions of the Board of Directors approving the transactions identified on Schedule 9.12 shall have been delivered to Purchaser);

(b) in the case of Affiliates who are not Credit Parties, arms-length transactions in the ordinary course of business; or

(c) as otherwise expressly permitted under Section 9.9 or 9.30(d).

9.13 Suspension. Suspend or terminate any substantial portion of the business in which the Credit Parties are engaged on the Closing Date.

9.14 Compensation. Increase, at any time, any fees (whether in the form of cash, equity incentives or otherwise) including, without limitation, the annual, per-meeting or other periodic fees paid to the members of its Board of Directors from the fees payable to such members on the Closing Date (which fees are set forth on Schedule 9.14) other than annual increases not to exceed 10% per annum in the aggregate.

9.15 Use of Proceeds. Use the proceeds of the Note for any purpose other than as set forth in Section 5.18.

9.16 Change in Location of Chief Executive Office; Inventory and Equipment with Bailees. Relocate its chief executive office to a new location without the Company providing thirty (30) days prior written notification thereof to the Collateral Agent and so long as, at the time of such written notification, the applicable Credit Party provides any

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financing statements necessary to perfect and continue perfected Purchaser’s Liens and also provides to the Collateral Agent a Collateral Access Agreement with respect to such new location. The Inventory and Equipment shall not at any time now or hereafter be stored with a bailee, warehouseman, or similar party unless the Collateral Agent has received an executed bailee letter from the applicable Person in form and substance reasonably satisfactory to the Collateral Agent.

9.17 Securities Accounts. Establish or maintain any Securities Account unless the Collateral Agent shall have received a satisfactory Control Agreement in respect of such Securities Account, except for any Securities Account pledged to the Senior Lender prior to the Closing Date and subject to a Lien securing the Obligations under the Transaction Documents subject to the Intercreditor Agreement. The Credit Parties shall not transfer assets out of any Securities Account; provided, however, that, so long as no Event of Default has occurred and is continuing or would result therefrom, the Credit Parties may use such assets (and the proceeds thereof) to the extent not prohibited by this Agreement.

9.18 Financial Covenants.

(a) Minimum Consolidated EBITDA. Permit Consolidated EBITDA of the Company, as of the end of each fiscal quarter of the Company, to fall below the levels set forth below opposite each such fiscal quarter of the Company with respect to the period of four consecutive fiscal quarters of the Company ending on such fiscal quarter; provided that for purposes of calculating the Consolidated EBITDA for the third fiscal quarter in 2003, the Consolidated EBITDA for the fourth fiscal quarter in 2002 shall be ($375,000):

Fiscal Quarter	Minimum Consolidated EBITDA
FQ3 2003	$2,500,000
FQ4 2003	$3,500,000
FQ1 2004	$4,500,000
FQ2 2004	$6,250,000
FQ3 2004	$7,750,000
FQ4 2004	$10,000,000
FQ1 2005	$10,250,000
FQ2 2005	$10,500,000
FQ3 2005	$10,750,000
FQ4 2005	$11,000,000
FQ1 2006	$11,000,000
FQ2 2006	$11,000,000
FQ3 2006	$11,000,000
FQ4 2006	$11,000,000
FQ1 2007	$11,000,000
FQ2 2007	$11,000,000
FQ3 2007	$11,000,000
FQ4 2007	$11,000,000

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(b) Consolidated Leverage Ratio. Permit the Consolidated Leverage Ratio of the Company at any time during or as of the end of a fiscal quarter of the Company to exceed the ratio set forth below opposite such fiscal quarter with respect to the period of four consecutive fiscal quarters of the Company ending on such fiscal quarter:

Fiscal Quarter	Consolidated Leverage Ratio
FQ4 2003	8.50 : 1.00
FQ1 2004	7.00 : 1.00
FQ2 2004	5.00 : 1.00
FQ3 2004	4.00 : 1.00
FQ4 2004	3.50 : 1.00
FQ1 2005	3.25 : 1.00
FQ2 2005	3.25 : 1.00
FQ3 2005	3.00 : 1.00
FQ4 2005	3.00 : 1.00
FQ1 2006	2.75 : 1.00
FQ2 2006	2.75 : 1.00
FQ3 2006	2.75 : 1.00
FQ4 2006	2.75 : 1.00
FQ1 2007	2.75 : 1.00
FQ2 2007	2.75 : 1.00
FQ3 2007	2.75 : 1.00
FQ4 2007	2.75 : 1.00

(c) Capital Expenditures. Make or commit to make Capital Expenditures, except for Capital Expenditures of the Credit Parties in the ordinary course of business, in an aggregate amount for all Credit Parties not exceeding $2,500,000 in any period of four (4) consecutive fiscal quarters of the Company (measured as at the end of each fiscal quarter of the Company with respect to the period of four (4) consecutive fiscal quarters ending on such date).

9.19 Limitation on Optional Payments and Modifications of Documents. (a) Make or offer to make any optional or voluntary payment, prepayment, repurchase or redemption of, or otherwise voluntarily or optionally defease, any Indebtedness, or segregate funds for any such payment, prepayment, repurchase, redemption or defeasance, or enter into any derivative or other transaction with any Derivatives Counterparty obligating any Credit Party to make payments to such Derivatives Counterparty as a result of any change in market value of such Indebtedness other than the prepayment of Indebtedness incurred hereunder, (b) amend, modify or otherwise change, or consent or agree to any amendment, modification, waiver or other change to, any of the terms (including, without limitation, the subordination terms) of any Indebtedness (excluding the Indebtedness hereunder) (other than any such amendment, modification, waiver or other change which (i) would extend the maturity or reduce the amount of any payment of principal thereof, reduce the rate or extend the date for payment of interest thereon or relax any covenant or other restriction applicable to the Credit Parties and (ii) does not

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involve the payment of a consent fee), or (c) amend or permit the amendment of its Governing Documents in any manner determined by Purchaser to be adverse to Purchaser.

9.20 Limitation on Sales and Leasebacks. Enter into any arrangement with any Person providing for the leasing by the Credit Parties of property which has been or is to be sold or transferred by the Credit Parties 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 the Credit Parties.

9.21 Limitation on Negative Pledge Clauses. Enter into or suffer to exist or become effective any agreement that prohibits or limits the ability of any Credit Party to create, incur, assume or suffer to exist any Lien upon any of its Property or revenues, whether now owned or hereafter acquired, to secure the Obligations or, in the case of any Guarantor, its obligations under the Guarantee, other than (a) this Agreement and the other Transaction Documents, (b) any agreements governing any Permitted Purchase Money Indebtedness or Capital Lease Obligations otherwise permitted hereby (in which case, any prohibition or limitation shall only be effective against the assets financed thereby), and (c) the agreements contained in the Senior Credit Agreement, as in effect on the date hereof.

9.22 Limitation on Restrictions on Subsidiary Distributions, etc. Enter into or suffer to exist or become effective any consensual encumbrance or restriction on the ability of any Credit Party to (a) make Restricted Payments in respect of any Equity of such Credit Party held by, or pay or subordinate any Indebtedness owed to, the Credit Parties, (b) make Investments in the Credit Parties or any other Subsidiary, (c) transfer any of its assets to any other Credit Party or (d) make any payment in connection herewith, except for such encumbrances or restrictions existing hereunder or by reason of (i) any restrictions existing under the Transaction Documents, (ii) any restrictions under paragraphs 14(j) and 14(k) of the Senior Credit Agreement, as in effect on the date hereof, and (iii) any restrictions with respect to a Subsidiary imposed pursuant to an agreement that has been entered into in connection with an Asset Disposition by such Subsidiary.

9.23 Fiscal Year. Change its fiscal year end to a date other than December 31, except in the case of MINDA IMPCO Technologies Limited, MINDA IMPCO Limited, IMPCO-BERU Technologies B.V., IMPCO-BERU Technologies GmbH, and IMPCO-BERU Technologies S.A.R.L., which shall change their respective fiscal years to December 31 effective as of January 1, 2004.

9.24 Partnerships and Joint Ventures. Except as set forth in Schedule 9.24 or as otherwise permitted by Sections 9.11(c) or 9.11(d), become a general or limited partner in a partnership or a joint venturer in any joint venture, or permit any Credit Party or any other Subsidiary to do so.

9.25 Solicitation.

(a) No Credit Party nor any Person acting on its behalf will directly or indirectly offer or sell the Securities by any form of general solicitation or general advertising (including, without limitation, any advertisement, article, notice or other communication published in any newspaper, magazine or similar media or any broadcast over television or radio

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or any seminar or meeting whose attendees have been invited by any form of general solicitation or general advertising).

(b) No Credit Party nor any Person acting on behalf of such Credit Party will, either directly or indirectly, sell or offer for sale to, or otherwise approach or negotiate in respect thereof with, any Person any Securities except as contemplated by this Agreement, and neither any Credit Party nor any Person acting on its behalf (other than Purchaser and their Affiliates) will sell or offer for sale to any Person any Securities or any other similar security of the Company, or solicit any offers to buy any such security from, or otherwise approach or negotiate in respect thereof with, any Person or Persons so as thereby to bring the issuance or sale of any of the Securities within the registration or prospectus delivery requirements of Section 5 of the Securities Act.

9.26 Margin Stock. Use the proceeds of the Securities for purchasing or carrying any “margin stock” (within the meaning of Regulation U) or for the purpose of purchasing, carrying or trading in any securities under such circumstances as to involve the Credit Parties in a violation of Regulation X or to involve any broker or dealer in the violation of Regulation T.

9.27 Investment Company Act. None of the Credit Parties shall become an “investment company” or under the control of an “investment company” as such terms are defined in the Investment Company Act.

9.28 Consulting Fees. Pay, or agree or commit to pay (in writing or otherwise), consulting fees or expenses pursuant to any agreement for management, consulting or other similar services in excess of $100,000 to any Person in any fiscal year, without the prior written consent of Purchaser, which consent shall not be unreasonably withheld.

9.29 Other Obligations. (a) Fail to perform or observe, or permit any of its Affiliates to fail to perform or observe, any negative covenants, agreements or any other obligations of the Credit Parties or such Affiliates contained in (i) the Senior Credit Documents, and (ii) the Existing Notes and (b) amend, waive or otherwise modify, or permit any of its Affiliates to amend, waive or otherwise modify, any term or condition of any of such documents without the prior written consent of Purchaser.

9.30 Credit; Outstanding Receivables.

(a) Extend credit to any Account Debtor in respect of sales or account receivables other than in the ordinary course of business; provided that in no circumstances shall the amount of credit extended to any Account Debtor and its Affiliates (other than United Parcel Service, Inc., Nacco Material Handlings, Mitsubishi Caterpillar or any Affiliate thereof), individually or in the aggregate, exceed twenty percent (20%) of the aggregate credit extended to all Account Debtors.

(b) Permit U.S. receivables of the Credit Parties (calculated in accordance with GAAP consistent with the Company’s past practice and net of reserves made in accordance with GAAP) that are outstanding for more than ninety (90) days from the date of the

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invoice thereof to exceed twenty-five percent (25%) of the aggregate U.S. receivables of the Credit Parties.

(c) Permit U.S. payables of the Credit Parties (calculated in accordance with GAAP consistent with the Company’s past practice) to be outstanding for more than ninety (90) days from the date of the invoice thereof to exceed twenty-five percent (25%) of the aggregate U.S. payables of the Credit Parties or $2,000,000 in the aggregate.

(d) Directly or indirectly, extend credit to, or incur Indebtedness otherwise permitted hereunder for the benefit of any Foreign Subsidiary or any Unconsolidated Affiliate of the Company or its Subsidiaries (including but not limited to, the incurrence of any Contingent Obligation), except for credit, Indebtedness or any Contingent Obligation not to exceed, in the aggregate, the amounts set forth below opposite each identified Foreign Subsidiary and Unconsolidated Affiliate or group thereof (including, “Future Foreign Subsidiaries” which for purposes of this subclause (d) shall mean Foreign Subsidiaries of the Company or its Subsidiaries formed after the Closing Date in accordance with Section 9.11(c)):

Foreign Subsidiary	Permitted Credit
IMPCO Technologies Pty Limited IMPCO Technologies (SA) Pty. Ltd. IMPCO Technologies (NSW) Pty. Ltd. IMPCO Fuel Systems Pty Ltd	$	1,000,000
IMPCO Technologies Japan, KK	$	500,000
Grupo I.M.P.C.O. Mexicano	$	5,000,000
IMPCO-BERU Technologies B.V. IMPCO-BERU Technologies GmbH IMPCO-BERU Technologies S.A.R.L. IMPCO-BERU Technologies Limited	$	2,000,000
Minda IMPCO Technologies Limited Minda IMPCO Limited CNGC—IMPCO Technologies, LLC Future Foreign Subsidiaries	$	1,500,000

9.31 Contingent Obligations. Except as set forth on Schedule 5.23, incur, assume or otherwise be subject to any Contingent Obligations.

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9.32 Payment of Existing Indebtedness. Pay any existing Indebtedness of any Credit Party by the issuance of Equity in lieu of such Indebtedness.

9.33 Issuance of Equity. Issue, sell or offer for sale any Equity of the Company (other than Equity that is of a class that is publicly traded) without the prior written consent of Purchaser, which consent shall not be unreasonably withheld.

9.34 Restricted Financings.

(a) Enter into any financings with General Electric Capital Corporation (GE Capital) or, to the Company’s reasonable knowledge, any affiliate thereof, except as set forth on Schedule 5.26; or

(b) Increase the amount of any financing with General Electric Capital Corporation (GE Capital) or, to the Company’s reasonable knowledge, any affiliate thereof, to an aggregate amount in excess of $2,000,000.

9.35 New Accounts. Open or maintain any bank accounts, except as set forth on Schedule 5.14, without the prior written consent of Purchaser, which consent shall not be unreasonably withheld.

9.36 Amendments to the Senior Credit Documents. Amend any of the Senior Credit Documents without Purchaser’s prior written consent except for (a) amendments to increase the interest rate under the Senior Credit Documents as of the date hereof up to three percent (3%), in the aggregate, or (b) amendments that do not have a material negative impact on Purchaser, the rights and benefits of Purchaser under or in connection with any Transaction Document or any Collateral; provided, however, that the Company shall deliver to Purchaser written notice of the amendments permitted under clauses (a) and (b) above at least five (5) Business Days before such amendments become effective.

ARTICLE 10

EVENTS OF DEFAULT

10.1 Events of Default. Any one or more of the following events shall constitute an event of default (each, an “Event of Default”) under this Agreement (and for purposes of this Article 10, BRC shall be deemed a Credit Party and a Subsidiary):

(a) If any Credit Party fails to pay when due and payable or when declared due and payable all or any portion of the Obligations (whether of principal, interest (including any interest which, but for the provisions of the Bankruptcy Code, would have accrued on such amounts), fees and charges due Purchaser, reimbursement of Purchaser’s Expenses, or other amounts constituting Obligations);

(b) If any Credit Party fails to perform, keep, or observe, in any material respect, any term, provision, condition, covenant, or agreement contained in, or if there is a “default” or “event of default” under, this Agreement or any of the other Transaction Documents;

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(c) If any material portion of any Credit Party’s or any of its Subsidiaries’ assets is attached, seized, subjected to a writ or distress warrant, levied upon, or by reason of an act or omission to act by any Credit Party comes into the possession of any third Person;

(d) If (i) any Credit Party shall commence any case, proceeding or other action (A) under any existing or future law of any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an order for relief entered with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or seeking reorganization, arrangement, adjustment, winding-up, liquidation, dissolution, composition or other relief with respect to it or its debts, or (B) seeking appointment of a receiver, trustee, custodian, conservator or other similar official for it or for all or any substantial part of its assets, or any Credit Party shall make a general assignment for the benefit of its creditors; or (ii) there shall be commenced against any Credit Party any case, proceeding or other action of a nature referred to in clause (i) above that (A) results in the entry of an order for relief or any such adjudication or appointment or (B) remains undismissed, undischarged or unbonded for a period of sixty (60) days; or (iii) there shall be commenced against any Credit Party any case, proceeding or other action seeking issuance of a warrant of attachment, execution, distraint or similar process against all or any substantial part of its assets that results in the entry of an order for any such relief that shall not have been vacated, discharged, or stayed or bonded pending appeal within sixty (60) days from the entry thereof; or (iv) any Credit Party shall take any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the acts set forth in clause (i), (ii), or (iii) above; or (v) any Credit Party shall generally not, or shall be unable to, or shall admit in writing its inability to, pay its debts as they become due;

(e) If any Credit Party or any of its Subsidiaries is enjoined, restrained, or in any way prevented by court order or other Requirement of Law from continuing to conduct all or any material part of its business affairs to the extent such continuation would be material to the business of the Company as a whole;

(f) If a notice of Lien, levy, or assessment is filed of record with respect to a material portion of any Credit Party’s or any of its Subsidiaries’ assets by the United States, or any department, agency, or instrumentality thereof, or by any state, county, municipal, or governmental agency, or if any Taxes or debts owing at any time hereafter to any one or more of such entities becomes a Lien, whether choate or otherwise, upon any Credit Party’s or any of its Subsidiaries’ assets and the same is not paid on the latest permitted payment date thereof;

(g) If a judgment or other claim becomes a Lien or encumbrance upon any material portion of any Credit Party’s or any of its Subsidiaries’ properties or assets;

(h) If any Credit Party or any of its Subsidiaries makes any payment on account of Indebtedness that has been contractually subordinated in right of payment to the payment of the Obligations;

(i) If there is a default by a Credit Party or any of its Subsidiaries under (a) any material agreement to which any Credit Party or any of its Subsidiaries is a party (including, without limitation, the BRC Agreements), (b) the Senior Credit Agreement or (c) the Existing Notes, or any agreement referenced therein or related thereto and such default (i) occurs

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at the final maturity of the obligations thereunder or (ii) results in a right by the other party thereto, irrespective of whether exercised, to accelerate the maturity of the applicable Credit Party’s or its Subsidiaries’ obligations thereunder, to terminate such agreement, or to refuse to renew such agreement pursuant to an automatic renewal right therein;

(j) If any material misstatement or misrepresentation exists now or hereafter in any warranty, representation, statement, or Record made or deemed made to Purchaser by any Credit Party, its Subsidiaries, or any officer, employee, agent, or director of any Credit Party or any of its Subsidiaries other than, in the case of statements relating to a specific date, owing to changes in circumstances that render inaccurate such statements that were accurate and correct in all material respects as of such date;

(k) If the obligation of any Guarantor under its Guarantee is limited or terminated by operation of law or by such Guarantor thereunder, or if any Credit Party shall so assert;

(l) If this Agreement or any other Transaction Document that purports to create a Lien, shall, for any reason, fail or cease to create a valid and perfected and, except to the extent permitted by the terms hereof or thereof, first priority Lien on and security interest in any or all of the Collateral covered hereby or thereby;

(m) If any provision of any Transaction Document shall at any time for any reason be declared to be null and void, or the validity or enforceability thereof shall be contested by any Credit Party, or a proceeding shall be commenced by any Credit Party, or by any Governmental Authority having jurisdiction over any Credit Party, seeking to establish the invalidity or unenforceability thereof, or any Credit Party shall deny that any Credit Party has any liability or obligation purported to be created under any Transaction Document;

(n) If there shall occur any Change of Control; provided, however, that no Event of Default shall occur in connection with a Change of Control occasioned by (i) an underwritten public offering of Common Stock (provided, that the offering price per share of such Common Stock shall be greater than the Exercise Price (as defined in the Warrant Agreement and adjusted in accordance therewith) in effect at the time of such public offering), (ii) a Permitted Disposition, or (iii) a Change of Control that occurs at a time when no Event of Default shall have occurred and be continuing and when the entity that is to survive such Change of Control shall, prior to the consummation of such event, offers to effect (and shall, in the reasonable discretion of Purchaser, have the financial ability to effect) an optional redemption of the Note pursuant to Section 11.1(a);

(o) If (i) any Termination Event shall occur that, when taken together with all other Termination Events that have occurred, could result in a liability to any Credit Party in excess of $100,000; (ii) any Credit Party shall have committed a failure described in Section 302(f)(1) of ERISA and the amount determined under Section 302(f)(3) of ERISA is at least $100,000; (iii) any failure to make full payment (including all required installments) when due of all amounts that, under the provisions of any Benefit Plan or Applicable Law, any Credit Party is required to pay as contributions thereto, which would result in a liability to any Credit Party in excess of $100,000; or (iv) any Credit Party shall have incurred any accumulated

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funding deficiency (within the meaning of Section 412 of the Code or Section 302 of ERISA) in excess of $100,000, whether or not waived, with respect to any Benefit Plan;

(p) If any Credit Party shall default under a lease obligation in excess of $50,000, in the aggregate, such that the landlord under such lease shall be entitled to place a Lien on any of the Collateral;

(q) If a Material Adverse Change occurs;

(r) If any Credit Party fails to comply in any material respect with the terms of the Strategic Consulting Agreement and such failure shall remain unremedied for five (5) days after the date upon which an Executive Officer of any Credit Party becomes aware or reasonably should have become aware of such failure;

(s) If there is any amendment of any BRC Agreement, which adversely affects Purchaser (in the sole judgment of Purchaser), without the prior written consent of Purchaser; and

(t) If there is any amendment of any of BRC’s governing documents without the prior written consent of Purchaser, unless such amendment, in Purchaser’s reasonable judgment, could not materially affect Purchaser’s right under the Transaction Documents.

10.2 Rights and Remedies. Upon the occurrence, and during the continuation, of an Event of Default (other than an Event of Default with respect to any Credit Party described in Section 10.1(d), in which event, automatically the Obligations shall immediately be due and accelerated and the Note (with accrued interest thereon) and all other amounts owing under this Agreement and the other Transaction Documents shall immediately become due and payable), and at any time thereafter during the continuance of such Event of Default, the Collateral Agent or Purchaser may, by notice to the Company, and subject to the provision of the Intercreditor Agreement, do any one or more of the following, all of which are authorized by the Credit Parties:

(a) Declare all Obligations, whether evidenced by this Agreement, by any of the other Transaction Documents, or otherwise, immediately due and payable; provided that, in the event of an acceleration of the Note prior to the final maturity of the Note, the amount due and owing shall be the Stated Principal Amount (together with accrued and unpaid interest thereon and premium, if any, and any post-Default interest payable pursuant to Sections 2.6 and 10.2(r)) subject to the Intercreditor Agreement.

(b) Cease advancing money or extending credit to or for the benefit of the Credit Parties under this Agreement, under any of the Transaction Documents, or under any other agreement between the Credit Parties and Purchaser;

(c) Terminate this Agreement and any of the other Transaction Documents as to any future liability or obligation of Purchaser, but without affecting any of Purchaser’s Liens in the Collateral and without affecting the Obligations;

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(d) Settle or adjust disputes and claims directly with Account Debtors for amounts and upon terms which Purchaser consider advisable, and in such cases, Purchaser will distribute to the Company only the net amounts received by Purchaser in payment of such disputed Accounts after deducting all Purchaser’s Expenses incurred or expended in connection therewith and, at the option of Purchaser, after application to the Obligations;

(e) Cause any Credit Party to hold all returned Inventory or Equipment in trust for Purchaser, segregate all returned Inventory or Equipment from all other assets of the Credit Parties or in the Credit Parties’ possession and conspicuously label said returned Inventory or Equipment as the property of Purchaser;

(f) Without notice to or demand upon any Credit Party or any Guarantor, make such payments and do such acts as the Collateral Agent or Purchaser consider necessary or reasonable to protect their security interests in the Collateral. Each Credit Party agrees to assemble the Collateral if the Collateral Agent so requires, and to make the Collateral available to the Collateral Agent at a place that the Collateral Agent may designate which is reasonably convenient to the parties. Each Credit Party authorizes the Collateral Agent to enter the premises where the Collateral is located, to take and maintain possession of the Collateral, or any part of it, and to pay, purchase, contest, or compromise any Lien that in the Collateral Agent’s determination appears to conflict with the Collateral Agent’s or Purchaser’s Liens and to pay all expenses incurred in connection therewith and to charge the Credit Parties therefor. With respect to any of the Credit Parties’ owned or leased premises, each Credit Party hereby grants the Collateral Agent and Purchaser a non-exclusive royalty free license to enter into possession of such premises and to occupy the same, without charge, in order to exercise any of the Collateral Agent or Purchaser’s rights or remedies provided herein, at law, in equity, or otherwise;

(g) Without notice to any Credit Party (such notice being expressly waived), and without constituting a retention of any collateral in satisfaction of an obligation (within the meaning of the UCC), set off and apply to the Obligations any and all (i) balances and deposits of any Credit Party held by Purchaser, or (ii) Indebtedness at any time owing to or for the credit or the account of any Credit Party held by Purchaser;

(h) Hold, as cash collateral, any and all balances and deposits of any Credit Party held by Purchaser to secure the full and final repayment of all of the Obligations;

(i) Ship, reclaim, recover, store, finish, maintain, repair, prepare for sale, advertise for sale, and sell (in the manner provided for herein or in any Security Document) the Collateral;

(j) Sell the Collateral at either a public or private sale, or both, by way of one or more contracts or transactions, for cash or on terms, in such manner and at such places (including the Credit Parties’ premises) as the Collateral Agent determines is commercially reasonable. It is not necessary that the Collateral be present at any such sale;

(k) The Collateral Agent shall give notice of the disposition of the Collateral as follows:

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(i) The Collateral Agent or Purchaser shall give the Company (for the benefit of the applicable Credit Party) a notice in writing of the time and place of public sale, or, if the sale is a private sale or some other disposition other than a public sale is to be made of the Collateral, the time on or after which the private sale or other disposition is to be made; and

(ii) The notice shall be personally delivered or mailed, postage prepaid, to the Company as provided in Section 14.2, at least ten (10) days before the earliest time of disposition set forth in the notice (and each party hereto agrees that such notice will be deemed reasonable notice); provided, that no notice needs to be given prior to the disposition of any portion of the Collateral that is perishable or threatens to decline speedily in value or that is of a type customarily sold on a recognized market;

(l) Purchaser may credit bid and purchase at any public sale;

(m) The Collateral Agent may seek the appointment of a receiver or keeper to take possession of all or any portion of the Collateral or to operate same and, to the maximum extent permitted by law, may seek the appointment of such a receiver without the requirement of prior notice or a hearing;

(n) The Collateral Agent and Purchaser shall have all other rights and remedies available to them at law or in equity or otherwise pursuant to any other Transaction Document;

(o) Any deficiency that exists after disposition of the Collateral as provided above will be paid immediately by the Credit Parties. Any excess will be returned, without interest and subject to the rights of third Persons, by Purchaser (for the benefit of the applicable Credit Party);

(p) Upon Purchaser’s written request to the Company, nominate an individual designated by Purchaser to serve as a director of the Company (the “Purchaser Nominee”) in the first election of directors that occurs following the Company’s receipt of such request, whether at an annual or special meeting of stockholders or effected by written consent of the stockholders. The Company shall use its best efforts to cause the Purchaser Nominee to be named as a nominee in such election and elected as a director to the Company’s Board of Directors in a manner consistent with its Governing Documents, the rules and regulations of the NASD and applicable law. In the event the Purchaser Nominee is elected to the Company’s Board of Directors by the stockholders of the Company, the Company shall pay reasonable fees (which fees shall be deemed reasonable if comparable to the fees then being paid to the other directors of the Company) to such Purchaser Nominee.

(q) Upon Purchaser’s written request to the Company, designate an individual designated by Purchaser to serve as a director of BRC (the “Purchaser’s BRC Nominee”) in accordance with the BRC Shareholders Agreement. The Company shall use its best efforts to cause the Purchaser’s BRC Nominee to be elected as a director to BRC’s Board of Directors in a manner consistent with its Governing Documents, the BRC Shareholders Agreement and applicable law. In the event the Purchaser’s BRC Nominee is elected to BRC’s Board of Directors by the stockholders of BRC, the Company shall cause BRC to pay reasonable

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fees to Purchaser in respect of services of such Purchaser’s BRC Nominee, it being understood that any director designated by Purchaser pursuant to this Section 10.2(q) shall have no right to any fees or other compensation payable to directors of BRC, which fees or other compensation shall be payable solely to Purchaser.

(r) For each month in which a Default or Event of Default under Article 8 or Article 9 shall have occurred and be continuing, increase the rate of interest otherwise payable on the Note by a half of one percent (.50%) for such month up to six (6) months for such Default or Event of Default (in addition to the interest provided for in Section 2.6); provided, that (i) Purchaser shall have provided the Company with a written notice of Default or Event of Default; and (ii) the Company shall have had thirty (30) days from such notice of Default or Event of Default to cure such Default or Event of Default.

10.3 No Waiver; Cumulative Remedies. No failure to exercise and no delay in exercising, on the part of Purchaser, any right, remedy, power or privilege hereunder or under the other Transaction Documents 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.

ARTICLE 11

NOTE REDEMPTION

11.1 Optional Redemption of Note; Change of Control

(a) Upon notice given to the holder of the Note as provided in Section 11.1(c), the Company, at its option, may, at any time after May 31, 2004, redeem the Note in full or in part by paying to the holder an amount equal to the applicable redemption prices (the “Optional Redemption Prices”) set forth below together with accrued and unpaid interest thereon to the date fixed for such redemption, and all Purchaser’s Expenses, if any, associated with such redemption; provided, however, each redemption in part shall be in an aggregate principal amount of at least $50,000. If such redemption is to be made by the Company to the applicable holder during the twelve (12) month period ending on the date set forth below, the Optional Redemption Price shall be determined based upon the percentage of the outstanding principal amount of the Note being redeemed, which corresponds to the period in question, as provided below:

Period On or Before	Optional Redemption Price
May 31, 2005	105.0%
May 31, 2006	102.5%
May 31, 2007	100%

(b) Change of Control. Subject to the subordination provisions of the Intercreditor Agreement, upon the occurrence of a Change of Control (other than a Change of Control that would not constitute an Event of Default hereunder), the holder of the Note shall

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have the right to require the Company to repurchase the Note. Upon such election by the holder of the Note, the Company shall redeem an amount equal to the lesser of (i) 103.0% of the principal amount thereof outstanding on the date of redemption (together with accrued interest thereon and premium, if any, and all Purchaser’s Expenses, if any, associated with such redemption) or (ii) the amount that would be derived from applying the Optional Redemption Price to the then outstanding principal amount of the Note. Such payment shall be due and payable within forty-five (45) days after the occurrence of such Change of Control.

(c) The Company may give written notice (which shall be irrevocable) of redemption of the Note or any portion thereof not less than ten (10) nor more than sixty (60) days prior to the date fixed for such redemption. Such notice of redemption shall be given in the manner specified in Section 14.2. Upon notice of redemption being given by the Company, the Company covenants and agrees that it will redeem, on the date therein fixed for redemption, the Note or the portion hereof so called for redemption, at the outstanding principal amount thereof or the portion thereof so called for redemption, together with accrued and unpaid interest thereon to the date fixed for such redemption, together with the Purchaser’s Expenses referred to in Sections 11.1(a) and (b).

(d) This Section 11.1 shall not apply to the payment of the Exercise Price (as defined in the Warrant Agreement) pursuant to Section 6(b)(iii) of the Warrant Agreement.

11.2 Excess Cash Flow; Mandatory Redemption. No later than one hundred (100) days after the end of each fiscal year of the Company, commencing with the fiscal year ending on December 31, 2004, the Company shall (a) deliver to Purchaser and the Senior Lender a forecast prepared by the Company and certified by the Chief Financial Officer of the Company that reasonably projects, in Purchaser’s reasonable judgment, the amount of Excess Availability under and as defined in the Senior Credit Agreement (the “Availability Forecast”) by the Company for the immediately following thirty (30) days and (b) at the option of Purchaser and subject to the terms of the Senior Credit Documents, redeem any principal and interest amount outstanding under the Note equal to fifty percent (50%) of the Excess Cash Flow for the fiscal year then ended (if any). Payments made pursuant to this Section 11.2 (such payments, the “Excess Cash Flow Payments,” and each an “Excess Cash Flow Payment”) shall not be construed as subject to the provisions of Section 11.1(a) above; provided that such Excess Cash Flow Payment (or portion thereof) shall be made only to the extent that (i) after giving pro forma effect to such Excess Cash Flow Payment (or portion thereof), the amount of Excess Availability under and as defined in the Senior Credit Agreement shall not be less than $3,000,000 in the aggregate, (ii) the Availability Forecast projects that the amount available to be drawn under the Senior Credit Agreement shall not be less than $3,000,000, in the aggregate, during the related 30-day period and (iii) the amount of Excess Availability under and as defined in the Senior Credit Agreement for the 30-day period immediately preceding such Excess Cash Flow Payment (or portion thereof) shall not be less than $3,000,000 in the aggregate during such 30-day period.

11.3 Exercise of Option by BRC Shareholders; Mandatory Redemption. In the event any call option is exercised by the BRC Shareholders as set forth and in accordance with the BRC Sale and Purchase Agreement pursuant to which one or more of the BRC Shareholders shall purchase any portion of the Equity of BRC then owned by the Company or any of its Affiliates, the Company shall cause BRC to pay the purchase price directly to

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Purchaser, and such payment shall redeem any principal and interest amount outstanding under the Note and any other Obligation then due and payable; provided, however, that if such payment exceeds the amount required to repay all accrued and outstanding Obligations, Purchaser shall pay the excess amount to the Company. Payments made pursuant to this Section 11.3 shall not be construed as subject to the provisions of Section 11.1a) above.

11.4 Application of Proceeds. All optional redemptions under this Article 11 shall include payment of accrued and unpaid interest on the principal amount so prepaid and premium, if any, and shall be applied first to all Purchaser’s Expenses and indemnities payable under this Agreement, then to payment of premium, if any, then to payment of default interest, if any, then to payment of accrued interest, and thereafter to principal.

ARTICLE 12

PUT OPTION

12.1 Purchaser Put Option. If the Exercise Price (as defined in the Warrant Agreement) of the Warrant is adjusted pursuant to Section 10(f) of the Warrant Agreement, Purchaser thereafter shall have the right at any time after eighteen (18) months following the Closing Date to put all or any portion of the Warrant to the Company, and the Company shall purchase the shares represented by all or such portion of the Warrant at a purchase price of $2.00 per share; provided that if the Common Stock trades at a price per share greater than the Initial Exercise Price as adjusted pursuant to the last sentence of Section 2.2 by $3.00 or more for ten (10) consecutive trading days after eighteen (18) months following the Closing Date, then the put option set forth in this Section 12.1 shall terminate.

ARTICLE 13

THE COLLATERAL AGENT

13.1 Bison Capital as the Collateral Agent. The parties hereto acknowledge and agree that Bison Capital has entered into certain documents with respect to the Collateral, and is named on financing statements and similar instruments as the secured party, as agent for the benefit of Purchaser (in such capacity, the “Collateral Agent”), and that certain items of Collateral have been, and will be, delivered to the Collateral Agent in accordance with the terms of such documents. It is a condition to Bison Capital’s willingness to act as the Collateral Agent that Purchaser shall have agreed to the provisions of this Section 12.1 as a condition to the transfer to Bison Capital of the Note.

(a) Except as otherwise provided herein, the Collateral Agent may, but shall not be required to, take any action believed by the Collateral Agent to be necessary or advisable to perfect and maintain the perfection and priority of Purchaser’s Liens, without notice to or consent from Purchaser.

(b) The Collateral Agent shall have no obligation whatsoever to Purchaser with respect to the Collateral including, without limitation, to assure that the Collateral exists or is owned by any Credit Party, that such Collateral is cared for, protected or insured, or that Purchaser’s Liens have been created, perfected or have any particular priority. With respect

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to the Collateral, the Collateral Agent may act in any manner it may deem appropriate, in its sole discretion and it shall have no duty or liability whatsoever to Purchaser, except for any losses, claims, damages, liabilities, actions or expenses that are determined by final judgment of a court of competent jurisdiction to result solely from the Collateral Agent’s gross negligence or willful misconduct.

(c) The Collateral Agent shall not be responsible in any manner to Purchaser for any recitals, statements, representations or warranties made by any Credit Party or any officer thereof contained in this Agreement or any other Transaction Document or in any certificate, report, statement or other document referred to or provided for in, or received by the Collateral Agent under or in connection with, this Agreement or any other Transaction Document or for the value, validity, effectiveness, genuineness, enforceability or sufficiency of its obligations hereunder or thereunder. The Collateral Agent shall not be under any obligation to Purchaser to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, this Agreement or any other Transaction Document, or to inspect the Properties, Books or records of any Credit Party.

(d) Purchaser shall indemnify the Collateral Agent (to the extent not reimbursed by the Credit Parties and without limiting the obligations of the Credit Parties to do so) ratably according to the aggregate principal amount of the Note held from time to time by Purchaser in effect on the date on which indemnification is sought, from and against any and all losses, claims, damages, liabilities, actions or expenses of any kind whatsoever which may at any time (including, without limitation, at any time following the payment of the Note) be imposed on, incurred by or asserted against the Collateral Agent in any way relating to or arising out of, the Obligations, this Agreement, any other Transaction Document or any document contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby or any action taken or omitted by the Collateral Agent under or in connection with any of the foregoing; provided that Purchaser shall not be liable for the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements that are determined by final judgment of a court of competent jurisdiction to result solely from the Collateral Agent’s gross negligence or willful misconduct. The agreements in this subsection (d) shall survive the termination of this Agreement and the payment in full of the Notes.

(e) The Collateral Agent may resign as the Collateral Agent upon at least thirty (30) days’ prior notice to Purchaser and the Company, such resignation to be effective upon the acceptance of a successor agent to its appointment as the Collateral Agent. If no successor agent is appointed prior to the effective date of the resignation of the Collateral Agent, the Collateral Agent may appoint, after consulting with Purchaser and the Company, a successor agent. Upon the acceptance of its appointment as successor agent hereunder, such successor agent shall succeed to all the rights, powers and duties of the retiring Collateral Agent and the term “Collateral Agent” shall mean such successor agent and the retiring Collateral Agent’s appointment, powers and duties as the Collateral Agent shall be terminated. After any retiring Collateral Agent’s resignation hereunder as the Collateral Agent, the provisions of this Section 12.1 shall continue to inure to its benefit as to any actions taken or omitted to be taken by it while it was the Collateral Agent under this Agreement.

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13.2 Maintenance of Register. The Company shall maintain at its principal executive office a register (the “Register”) for the registration and registration of transfers of the Note. The name and address of the holder of the Note, each transfer thereof and the name and address of each transferee shall be registered in the Register. Prior to due presentment for registration of transfer, absent manifest error, the Person in whose name any Note shall be registered shall be deemed and treated as the owner and holder thereof for all purposes hereof. Any transfer of the Note shall be effective only upon appropriate entries with respect thereto being made in the Register. The Company shall give to the holder of the Note that is Bison Capital or an institutional investor, promptly upon request therefor, a complete and correct copy of the names and addresses of all registered holders of the Note.

ARTICLE 14

MISCELLANEOUS

14.1 Survival of Representations and Warranties. All of the representations and warranties made herein shall survive the execution and delivery of this Agreement, any investigation by or on behalf of Purchaser, acceptance of the Securities and payment therefor, or termination of this Agreement.

14.2 Notices. All notices, demands and other communications provided for or permitted hereunder shall be made in writing and shall be by registered or certified first-class mail, return receipt requested, telecopier (with receipt confirmed), courier service or personal delivery:

(a) if to Bison Capital:

Bison Capital Structured Equity Partners, LLC

100 Wilshire Boulevard, Suite 450

Santa Monica, CA 90401

Telecopier No.: (310) 260-6576

Attention:         Mr. Douglas B. Trussler

with a copy to:

Latham & Watkins LLP

633 West Fifth Street, Suite 4000

Los Angeles, CA 90071

Telecopier No.: (213) 891-8763

Attention:         Dominic Yoong, Esq.

(b) if to the Company:

IMPCO Technologies, Inc.

16804 Gridley Place

Cerritos, CA 90703

Telecopier No.: (562) 924-8063

Attention:         Mr. Robert M. Stemmler

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with a copy to:

Davis Wright Tremaine LLP

2600 Century Square

1501 Fourth Avenue

Seattle, WA 98101

Telecopier No.: (206) 628-7699

Attention: Marcus J. Williams, Esq.

All such notices and communications shall be deemed to have been duly given when delivered by hand, if personally delivered; when delivered by courier, if delivered by commercial overnight courier service; if mailed, five (5) Business Days after being deposited in the mail, postage prepaid; or if telecopied, when receipt is acknowledged.

14.3 Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the successors and permitted assigns of the parties hereto. Subject to applicable securities laws, Purchaser may assign any of its rights hereunder and under any of the Transaction Documents to any Person and Purchaser may assign, in whole or in part, the Note or the Warrant to any Person. None of the Credit Parties may assign any of its rights, or delegate any of its obligations, under this Agreement without the prior written consent of Purchaser (in their sole discretion), and any such purported assignment by any Credit Party without the written consent of Purchaser shall be void and of no effect. Except as provided in Article 7 with respect to the Indemnified Persons, no Person other than the parties hereto and their successors and permitted assigns is intended to be a beneficiary of any of the Transaction Documents.

14.4 Amendment and Waiver.

(a) No failure or delay on the part of any of the parties hereto in exercising any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power or remedy preclude any other or further exercise thereof or the exercise of any other right, power or remedy. The remedies provided for in this Agreement are cumulative and are not exclusive of any remedies that may be available to the parties hereto at law, in equity or otherwise.

(b) Any amendment, supplement or modification of or to any provision of this Agreement, any waiver of any provision of this Agreement, and any consent to any departure by any party from the terms of any provision of this Agreement, shall be effective (i) only if it is made or given in writing and signed by all of the parties hereto, and (ii) only in the specific instance and for the specific purpose for which it is made or given. No amendment, supplement or modification of or to any provision of this Agreement or any of the other Transaction Documents, or any waiver of any such provision or consent to any departure by any party from the terms of any such provision may be made orally. Except where notice is specifically required by this Agreement, no notice to or demand on the Company, any of its Subsidiaries or any other Credit Party in any case shall entitle the Company, any such Subsidiary or any such other Credit Party to any other or further notice or demand in similar or other circumstances.

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14.5 Signatures; Counterparts. Telefacsimile transmissions of any executed original document and/or retransmission of any executed telefacsimile transmission shall be deemed to be the same as the delivery of an executed original and unless otherwise specifically provided therein shall be effective upon confirmed transmission. At the request of any party hereto, the other parties hereto shall confirm telefacsimile transmissions by executing duplicate original documents and delivering the same to the requesting party or parties. This Agreement may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.

14.6 Headings. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

14.7 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

14.8 Determinations, Request or Consents. All determinations, requests, consents, waivers or amendments to be made by Purchaser in their opinion or judgment or with its approval or otherwise pursuant to the Transaction Documents shall be made with respect to the Note and the Warrant, by Purchaser.

14.9 Jurisdiction, Jury Trial Waiver, Etc. EACH CREDIT PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY:

(a) SUBMITS FOR ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND THE OTHER TRANSACTION DOCUMENTS TO WHICH IT IS A PARTY, OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT THEREOF, TO THE NON-EXCLUSIVE GENERAL JURISDICTION OF THE COURTS OF THE STATE OF CALIFORNIA LOCATED IN THE CITY OF LOS ANGELES, THE COURTS OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF CALIFORNIA, 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) 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 COMPANY AT ITS ADDRESS SET FORTH IN SECTION 14.2 OR AT SUCH OTHER ADDRESS OF WHICH THE COLLATERAL AGENT AND THE PURCHASER SHALL HAVE BEEN NOTIFIED PURSUANT THERETO;

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(d) 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;

(e) 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 SECTION ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES; AND

(f) WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER TRANSACTION DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.

14.10 Severability. If any one or more of the provisions contained in this Agreement, or the application thereof in any circumstance, is held invalid, illegal or unenforceable in any respect for any reason, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions hereof shall not be in any way impaired, unless the provisions held invalid, illegal or unenforceable shall substantially impair the benefits of the remaining provisions of this Agreement. The parties hereto further agree to replace such invalid, illegal or unenforceable provision of this Agreement with a valid, legal and enforceable provision that will achieve, to the extent possible, the economic, business and other purposes of such invalid, illegal or unenforceable provision.

14.11 Entire Agreement. This Agreement and the other Transaction Documents (together with the exhibits and schedules hereto and thereto), is intended by the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein and therein. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein or therein. This Agreement, together with the exhibits and schedules hereto, and the other Transaction Documents supersede all prior agreements and understandings between the parties with respect to such subject matter.

14.12 Publicity. Except as may be required by applicable law, none of the parties hereto shall issue a publicity release or announcement or otherwise make any public disclosure concerning this Agreement or the transactions contemplated hereby, without prior approval by the other party hereto. If any announcement is required by law to be made by any party hereto, prior to making such announcement such party will deliver a draft of such announcement to the other parties and shall give the other parties an opportunity to comment thereon.

14.13 Further Assurances. Each of the Credit Parties shall execute such documents and perform such further acts (including, without limitation, obtaining any consents, exemptions, authorizations, or other actions by, or giving any notices to, or making any filings with, any Governmental Authority or any other Person) as may be reasonably required or desirable to carry out or to perform the provisions of this Agreement, including without limitation, any post-closing assignments by Purchaser of a portion of the Securities to a Person not currently a party hereto.

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14.14 No Usurious Interest. Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to the Note, together with all fees, charges and other amounts which are treated as interest on the Note under applicable law (collectively, the “Charges”) shall exceed the maximum lawful rate (the “Maximum Rate”) which may be contracted for, charged, taken, received or reserved by the holder of the Note, the rate of interest payable in respect of the Note, together with all Charges payable in respect thereof, shall be limited to the Maximum Rate and, to the extent lawful, the interest and Charges that would have been payable in respect of the Note but were not payable as a result of the operation of this Section 14.16 shall be cumulated and the interest and Charges payable to Purchaser in respect of any other Notes shall be increased (but not above the Maximum Rate therefor) until such cumulated amount, together with interest thereon from the Closing Date to the date of repayment, shall have been received by the holder.

14.15 Suretyship Waivers. Each of the Credit Parties hereby waives any and all defenses applicable or available to guarantors or sureties whether arising as a result of the joint and several nature of the obligations of the Credit Parties hereunder or otherwise. Without limiting the generality of the foregoing, the waivers of the Guarantors set forth in Section 6 of the Guarantee are hereby incorporated herein by this reference mutatis mutandis and such waivers shall be deemed to be made by the Credit Parties hereunder as if such waivers had been expressly set forth herein.

14.16 Construction. Each covenant contained herein shall be construed (absent express provision to the contrary) as being independent of each other covenant contained herein, so that compliance with any one covenant shall not (absent such an express contrary provision) be deemed to excuse compliance with any other covenant. Where any provision herein refers to action to be taken by any Person, or which such Person is prohibited from taking, such provision shall be applicable whether such action is taken directly or indirectly by such Person. The parties hereto have participated jointly in the negotiation and drafting of this Agreement and the other Transaction Documents. In the event an ambiguity or question of intent or interpretation arises under any provision of this Agreement or any Transaction Document, this Agreement or such other Transaction Document shall be construed as if drafted jointly by the parties thereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Agreement or any other Transaction Document. Unless the context otherwise requires, “or” is not exclusive, and references to sections or subsections refer to sections or subsections of this Agreement.

14.17 Acknowledgments. Each of the Credit Parties hereby acknowledges that:

(a) it has been advised by counsel in the negotiation, execution and delivery of this Agreement and the other Transaction Documents;

(b) neither the Collateral Agent nor Purchaser has any fiduciary relationship with or duty to the Credit Parties arising out of or in connection with this Agreement or any of the other Transaction Documents, and the relationship between the Collateral Agent and Purchaser, on one hand, and the Credit Parties, on the other hand, in connection herewith or therewith is solely that of debtor and creditor; and

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(c) no joint venture is created hereby or by the other Transaction Documents or otherwise exists by virtue of the transactions contemplated hereby among the Collateral Agent and Purchaser or among the Credit Parties and Purchaser except for rights created by the Operating Agreement.

14.18 Survival of Rights. This Agreement shall remain in effect by and among the Company and Purchaser so long as Purchaser holds any interest in the Note or the Warrant.

14.19 Joint and Several Liability. The Credit Parties shall be liable for all amounts due to the Collateral Agent and/or Purchaser under the Note or this Agreement, regardless of which Credit Party actually receives the proceeds from the sale of the Securities or the manner in which the Collateral Agent and/or Purchaser account for the Securities on its books and records. Each Credit Party’s Obligations with respect to the Securities, and each Credit Party’s Obligations arising as a result of the joint and several liability of the Credit Parties hereunder, with respect to the Securities, shall be separate and distinct obligations, but all such Obligations shall be primary obligations of each Credit Party. Each Credit Party’s Obligations arising as a result of the joint and several liability of the Credit Parties hereunder with respect to the Securities shall, to the fullest extent permitted by law, be unconditional irrespective of (a) the validity or enforceability, avoidance or subordination of the Obligations of the other Credit Parties or of any promissory note or other document evidencing all or any part of the Obligations of the other Credit Parties, (b) the absence of any attempt to collect the Obligations from the other Credit Parties, any other Guarantor, or any other security therefor, or the absence of any other action to enforce the same, (c) the waiver, consent, extension, forbearance or granting of any indulgence by the Collateral Agent and/or Purchaser with respect to any provision of any instrument evidencing the Obligations of the other Credit Parties, or any part thereof, or any other agreement now or hereafter executed by the other Credit Parties and delivered to the Collateral Agent and/or Purchaser, (d) the failure by the Collateral Agent and/or Purchaser to take any steps to perfect and maintain its security interest in, or to preserve its rights to, any security or Collateral for the Obligations of the other Credit Parties, (e) the Collateral Agent’s and/or Purchaser’s election, in any proceeding instituted under the Bankruptcy Code, of the application of Section-1111(b)(2) of the Bankruptcy Code, (f) any borrowing or grant of a security interest by the other Credit Parties, as debtors-in-possession under Section 364 of the Bankruptcy Code, (g) the disallowance of all or any portion of the Collateral Agent’s and/or Purchaser’s claim(s) for the repayment of the Obligations of the other Credit Parties under Section 502 of the Bankruptcy Code, or (h) any other circumstances which might constitute a legal or equitable discharge or defense of a Guarantor or of the other Credit Parties. With respect to each Credit Party’s Obligations arising as a result of the joint and several liability of the Credit Parties hereunder with respect to the Securities, each Credit Party waives, until the Obligations shall have been indefeasibly paid in full and the Agreement shall have been terminated, any right to enforce any right of subrogation or any remedy which the Collateral Agent and/or Purchaser now has or may hereafter have against such Credit Party, any endorser or any guarantor of all or any part of the Obligations, and any benefit of, and any right to participate in, any security or collateral given to the Collateral Agent and/or Purchaser to secure payment of the Obligations or any other liability of the Credit Parties to the Collateral Agent and/or Purchaser. Upon and during the continuance of any Event of Default, the Collateral Agent may proceed directly and at once, without notice, against any Credit Party to collect and recover the full amount, or any

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portion of the Obligations, without first proceeding against any other Credit Party or any other Person, or against any security or collateral for the Obligations. Each Credit Party consents and agrees that the Collateral Agent shall be under no obligation to marshal any assets in favor of such Credit Party or against or in payment of any or all of the Obligations.

14.20 Contribution and Indemnification among the Credit Parties. To the extent that any Credit Party shall, under this Agreement as a joint and several obligor, repay any of the Obligations relating to the Note incurred directly and primarily by any other Credit Party (an “Accommodation Payment”), then the Credit Party making such Accommodation Payment shall be entitled to contribution and indemnification from, and be reimbursed by, each of the other Credit Parties in an amount, for each of such other Credit Parties, equal to a fraction of such Accommodation Payment, the numerator of which fraction is such other Credit Party’s “Allocable Amount” (as defined below) and the denominator of which is the sum of the Allocable Amounts of all of the Credit Parties. As of any date of determination, the “Allocable Amount” of each Credit Party shall be equal to the maximum amount of liability for Accommodation Payments which could be asserted against such Credit Party hereunder without (a) rendering such Credit Party “insolvent” within the meaning of Section 101(31) of the Bankruptcy Code Section of the Uniform Fraudulent Transfer Act (the “UFTA”), or Section 2 of the Uniform Fraudulent Conveyance Act (the “UFCA”), (b) leaving such Credit Party with unreasonably small capital or assets, within the meaning of Section 548 of the Bankruptcy Code, Section 4 of the UFTA, or Section 5 of the UFCA, or (c) leaving such Credit Party unable to pay its debts as they become due within the meaning of Section 548 of the Bankruptcy Code or Section 4 of the UFTA, or Section 5 of the UFCA. All rights and claims of contribution, indemnification and reimbursement under this Section shall be subordinate in right of payment to the prior payment in full of the Obligations.

14.21 Additional Rights of Contribution. Each Credit Party hereby agrees that to the extent that any individual Credit Party or entity obligated hereunder shall have paid an amount hereunder or pursuant to this Agreement which would, but for this provisions, render such Credit Party or entity insolvent for purposes of state or federal fraudulent conveyance laws, such Credit Party shall be entitled to seek and receive contribution from and against any other Credit Party hereunder to the extent such contribution would not render such other Credit Party insolvent. The provisions of this Section 14.21 shall in no respect limit the obligations and liabilities of any Credit Party to Collateral Agent and Lenders and each Credit Party shall remain liable to Collateral Agent and Lenders for the full amount of such Credit Party’s Obligations hereunder.

14.22 Agency of the Company for each other Credit Party. Each of the other Credit Parties appoints the Company as its agent for all purposes relevant to this Agreement, including (without limitation) the giving and receipt of notices and the execution and delivery of all documents, instruments and certificates contemplated herein and all modifications hereto. Any acknowledgment, consent, direction, certification or other action which might otherwise be valid or effective only if given or taken by all of the Credit Parties acting singly or jointly, or both, shall be valid and effective if given or taken only by the Company, whether or not any of the other Credit Parties joins therein.

14.23 Expenses. The Credit Parties agree to pay from time to time immediately upon demand (i) all Purchaser’s expenses and all reasonable out-of-pocket costs and

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expenses incurred by Purchaser, including the reasonable fees, charges and disbursements of counsel, in connection with the preparation, execution, delivery, funding and administration of the Transaction Documents or any amendments, modifications or waivers of the provisions thereof and the perfection or priority of any Lien granted pursuant to any Security Document, (ii) all out-of-pocket costs and expenses incurred by Purchaser, including the reasonable fees, charges and disbursements of any counsel, in connection with the enforcement or protection of its rights or remedies under the Transaction Documents, including all such out-of-pocket costs and expenses incurred during any workout, restructuring or negotiations in respect of the Securities and (iii) all out-of-pocket costs and expenses incurred by Purchaser, including the reasonable fees, charges and disbursements of any counsel, in connection to the monitoring of the Securities, including any related Taxes and fees in connection thereto, in each of clauses (i), (ii) and (iii), including, but not limited to, all due diligence, syndication or other expenses, including distribution, rating agency, messenger, audit, insurance, search, filing and recording fees.

14.24 Prevailing Party; Attorney’s Fees. If any party hereto commences any action against any other party hereto with respect to the enforcement or interpretation of any of the Transaction Documents, then the prevailing party in such action shall be entitled to an award of its costs of litigation, including reasonable attorney’s fees.

14.25 Certain Covenants of Purchaser.

(a) Neither Purchaser nor any Person acting on its behalf will directly or indirectly offer or sell the Securities by any form of general solicitation or general advertising with respect to the Securities (including, without limitation, any advertisement, article, notice or other communication published in any newspaper, magazine or similar media or any broadcast over television or radio or any seminar or meeting whose attendees have been invited by any form of general solicitation or general advertising) unless and until a registration statement covering the sale of such shares has been declared effective by the SEC or if registration of such shares is otherwise not then required.

(b) Neither Purchaser nor any Person acting on behalf of such Purchaser will, either directly or indirectly, sell or offer for sale to, or otherwise approach or negotiate in respect thereof with, any Person any Securities or any other similar security of the Company except as contemplated by this Agreement, in each case so as thereby to bring the sale of or offer to sell any of the Securities within the registration or prospectus delivery requirements of Section 5 of the Securities Act.

(c) For the avoidance of doubt, nothing in this Section 14.25 shall restrict in any way Purchaser’s rights under the Registration Rights Agreement.

(Signature Pages Follow)

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IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be executed and delivered by their respective officers hereunto duly authorized as of the date first above written.

BISON CAPITAL STRUCTURED EQUITY PARTNERS, LLC, a Delaware limited liability company
By:
	Name:    Douglas B. Trussler
	Title:      Executive Vice President
IMPCO TECHNOLOGIES, INC., a Delaware corporation
By:
	Name:    Robert M. Stemmler
	Title:      President and Chief Executive Officer

SECURITIES PURCHASE AGREEMENT

Schedule 1

Securities

Note	Principal Amount
	$	20,000,000
	Purchase Price
		$15,850,000
Total:		$15,850,000
Warrant	Shares of Common Stock
		500,000
($0.001 par value per share)
Total:		500,000
	Purchase Price
		$1,400,000
Total:		$1,400,000

Schedule 1

Schedule 8.2

Reporting Package

Flash Sales Reports

Any flash sales reports that the Company may issue from time to time within five (5) days of such issuance.

Borrowing Base Certificate and Reports - Weekly

Any Borrowing Base Certificate and related weekly reports that is delivered to the Senior Lender in accordance with paragraph 11(a) of the Senior Credit Agreement.

Monthly Reports

Within thirty (30) days (or forty-five (45) days in the case of a month that is the end of a fiscal quarter) after the end of each month:

1. a Company prepared consolidated and consolidating balance sheet, income statement, and statement of cash flow covering the Company’s and its Subsidiaries’ operations during such month and the portion of the fiscal year through the end of such month, setting forth in each case in comparative form the figures for the previous year;

2. a certificate signed by each Chief Financial Officer of the Company to the effect that:

(a) the financial statements delivered hereunder have been prepared in accordance with GAAP (except for the lack of footnotes and being subject to year-end audit adjustments) and fairly present in all material respects the financial condition of the Company and its Subsidiaries,

(b) the representations and warranties of the Credit Parties contained in this Agreement and the other Transaction Documents are true and correct in all material respects on and as of the date of such certificate, as though made on and as of such date (except to the extent that such representations and warranties relate solely 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); and

(c) there does not exist any condition or event that constitutes a Default or Event of Default (or, to the extent of any non-compliance, describing such non-compliance as to which he or she may have knowledge and what action the Credit Parties have taken, are taking, or propose to take with respect thereto);

3. a Compliance Certificate demonstrating, in reasonable detail, compliance at the end of such month with the financial covenants contained in Section 9.18;

Schedule 8.2

4. an income statement for such month and year-to-date on a consolidated and consolidating basis and by division, with comparative information relative to the same month and year-to-date during the immediately preceding fiscal year;

5. an income statement for such month and year-to-date on a consolidated and consolidating basis and by division, with comparative information relative to the Budget for the same month and on a year-to-date basis;

6. a cash flow statement, both domestic and consolidated, for such month and on a year-to-date basis and for the same month and year-to-date for the immediately preceding year;

7. Any estimate of backlog that the Company may produce for each division on a monthly basis;

8. any report made or notice given by any Credit Party under the Senior Credit Agreement during such month;

9. any report received by any Credit Party from any of its Affiliates or Subsidiaries (including Foreign Subsidiaries) during such month; and

10. such other information as may at any time be requested by Purchaser, to monitor such critical success factors of the Credit Parties as have been agreed as between the Credit Parties and Purchaser are needed to be achieved in order for any Credit Party to meet their financial projections, including, without limitation, aged backlog, receivables aging and payables aging.

Quarterly Reports

Within forty-five (45) days after the end of each quarter, a copy of the Company’s Quarterly Report on Form 10-Q for the preceding quarter and such other information as Purchaser may request.

Schedule 8.2

EX-10.73

Exhibit 10.73

PLEDGE AGREEMENT

THIS PLEDGE AGREEMENT, dated as of July 18, 2003, is made by IMPCO TECHNOLOGIES, INC., a Delaware corporation (the “Company”) (together with any Subsidiary thereof that executes a Joinder Agreement, the “Pledgors” and each, a “Pledgor”) in favor of BISON CAPITAL STRUCTURED EQUITY PARTNERS, LLC, a Delaware limited liability company, as Collateral Agent (in such capacity, the “Collateral Agent”) for Purchaser party to that certain Securities Purchase Agreement, dated as of the date hereof (as amended, supplemented or otherwise modified from time to time, the “Purchase Agreement”), among the Pledgors, the Collateral Agent and Purchaser.

W I T N E S S E T H:

WHEREAS, pursuant to the Purchase Agreement, the Company has agreed to sell to Purchaser, and Purchaser has agreed to purchase, the Note and the Warrant upon the terms and subject to the conditions set forth therein; and

WHEREAS, it is a condition precedent to the obligation of Purchaser to purchase the Note and the Warrant that the Pledgors shall have executed and delivered this Agreement (as defined herein) to secure payment and performance of the Obligations.

NOW, THEREFORE, in consideration of the premises and to induce the Collateral Agent and Purchaser to enter into the Purchase Agreement and to induce Purchaser to purchase the Note and the Warrant, each of the Pledgors hereby agrees with the Collateral Agent, for the benefit of the Collateral Agent and of Purchaser, as follows:

1. Defined Terms

(a) Unless otherwise defined herein, terms defined in the Purchase Agreement and used herein shall have the meanings given to them in the Purchase Agreement.

(b) The following terms shall have the following meanings:

“Agreement”: this Pledge Agreement, as the same may be amended, modified or otherwise supplemented from time to time.

“Collateral”: the Pledged Equity and all Proceeds.

“Issuers”: the collective reference to the Persons identified on Schedule 1 attached hereto (as such Schedule 1 may be supplemented from time to time pursuant to the terms of this Agreement) as the issuers of the Pledged Equity; individually, each an “Issuer.”

“Payment Account”: shall have the meaning set forth in the Security Agreement.

“Pledged Equity”: the shares or units of Equity listed on Schedule 1 hereto, together with all additional shares or units of Equity, equity certificates, options or rights of any nature whatsoever that may be issued or granted by any Issuer to any Pledgor while this Agreement is in effect.

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“Proceeds”: all “proceeds” as such term is defined in Section 9-102 of the UCC and, in any event, shall include, without limitation, all dividends or other income from the Pledged Equity, collections thereon or distributions with respect thereto.

“UCC”: the Uniform Commercial Code, as in effect from time to time, of the State of New York.

(c) 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 and paragraph references are to this Agreement unless otherwise specified.

(d) The meanings given to terms defined herein shall be equally applicable to both the singular and plural forms of such terms.

2. Pledge; Grant of Security Interest; Certain Limited Exclusions

Each of the Pledgors hereby pledges and grants to the Collateral Agent, for the benefit of the Collateral Agent and of Purchaser, subject to the provisions of the Intercreditor Agreement, a first priority perfected security interest in the Collateral, as collateral security for the prompt and complete payment and performance when due (whether at the stated maturity, by acceleration or otherwise) of the Obligations (including, but not limited to, obligations under the Purchase Agreement, the Note and the Guarantee).

Notwithstanding anything herein to the contrary, in no event shall the security interest granted under this Section 2 attach to, and the Collateral shall not include:

(a) more than 66% of the Equity of any Foreign Subsidiary to the extent that a pledge of more than 66% of such Equity will result in a material adverse Tax consequence for the Company; and

(b) any Equity subject to any agreement to which any Pledgor is a party to the extent that the pledge of such Equity or the creation of a security interest therein would constitute a breach of the terms of such agreement, or would permit any party to terminate such agreement, in each case as entered into by the applicable Pledgor; provided that, any of the Equity excluded in accordance with the foregoing shall cease to be so excluded if the applicable Pledgor has obtained all of the consents of the parties necessary for the pledge or creation of a security interest in, such Equity; provided, further, that the applicable Pledgor hereby covenants and agrees to obtain such consents within ninety (90) days of the date hereof, except in the case of consenting parties that are Governmental Authorities, the applicable Pledgor shall use its best efforts to obtain such consents within the 90-day period provided above.

Upon request by one or more Pledgors, the Collateral Agent shall surrender to any Foreign Subsidiary or its transfer agent, for cancellation, any certificate in its possession representing more than 66% of the Equity of such Foreign Subsidiary in exchange for the issuance by such Foreign Subsidiary of (i) a replacement certificate representing 66% of the Equity of such Foreign Subsidiary, which replacement certificate shall be returned directly to the Collateral Agent subject to the terms of this Agreement, and (ii) a replacement certificate

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representing the difference between the amount of Equity of such Foreign Subsidiary owned by the applicable Pledgor, less the amount of Equity represented by the certificate transmitted to the Collateral Agent pursuant to sublause (i) above, which replacement certificate shall be transmitted to such Pledgor or its designee; provided, however, that such Foreign Subsidiary or transfer agent shall agree in writing, prior to such surrender, to hold the surrendered certificate and the replacement certificate representing 66% of the Equity of such Foreign Subsidiary on behalf of the Collateral Agent for purposes of perfection under the UCC.

3. Delivery; Stock Powers

Concurrently with the execution and delivery of this Agreement, each Pledgor shall deliver to the Collateral Agent all originals of all certificates evidencing any Pledged Equity then owned by Pledgor and promptly after acquiring rights in any additional Pledged Equity shall deliver to the Collateral Agent all originals of all certificates evidencing any such Pledged Equity. Concurrently with the delivery to the Collateral Agent of each certificate representing one or more shares or units of Pledged Equity to the Collateral Agent, each of the Pledgors shall deliver an undated equity interest power covering such certificate, duly executed in blank by such Pledgor. For so long as the obligations under the Senior Credit Agreement remain in effect, the requirement to physically deliver certificates evidencing the Pledged Equity shall be satisfied by delivering the foregoing to the Lender and obtaining the written acknowledgement of the Lender that it holds such Pledged Equity for the benefit of the Collateral Agent. In the event that any of the Pledged Equity shall constitute uncertificated securities for purposes of Article 8 of the UCC and subject to the provisions of the Inercreditor Agreement, each Pledgor shall either (a) cause the Collateral Agent to become the registered owner thereof or (b) cause the issuer of such uncertificated security to agree in writing to comply with all instructions issued by the Collateral Agent without further consent by the registered owner.

4. Representations and Warranties

Each of the Pledgors represents and warrants that:

(a) Such Pledgor has the organizational power and authority and the legal right to execute and deliver, to perform its obligations under, and to grant the security interest in the Collateral pursuant to, this Agreement and has taken all necessary organizational action to authorize its execution, delivery and performance of, and grant of the security interest in the Collateral pursuant to, this Agreement.

(b) This Agreement constitutes a legal, valid and binding obligation of such Pledgor, enforceable against such Pledgor in accordance with its terms, and upon delivery to the Collateral Agent of the certificates evidencing the Pledged Equity, the security interest created pursuant to this Agreement will constitute, subject to the provisions of the Intercreditor Agreement, a valid, first priority, perfected security interest in the Collateral, enforceable in accordance with its terms against all creditors of such Pledgor and any Persons purporting to purchase any Collateral from such Pledgor, except in each case as enforceability may be affected by bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar laws relating to or affecting creditors’ rights generally, general equitable principles (whether considered in a proceeding in equity or at law) and an implied covenant of good faith and fair dealing.

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(c) The execution, delivery and performance of this Agreement will not violate any provision of any requirement of law or Contractual Obligation of such Pledgor and will not result in the creation or imposition of any Lien on any of the properties or revenues of such Pledgor pursuant to any requirement of law or Contractual Obligation of such Pledgor, except the security interest created by this Agreement or as provided in the Intercreditor Agreement.

(d) No consent or authorization of, filing with, or other act by or in respect of, any arbitrator or Governmental Authority and no consent of any other Person (including, without limitation, any equityholder or creditor of the Pledgor), is required in connection with the execution, delivery, performance, validity or enforceability of this Agreement or the exercise of remedies with respect to any Collateral other than as required by the Intercreditor Agreement.

(e) No litigation, investigation or proceeding of or before any arbitrator or Governmental Authority is pending or, to the knowledge of such Pledgor, threatened by or against such Pledgor or against any of its properties or revenues with respect to this Agreement or any of the transactions contemplated hereby.

(f) Other than as described in Schedule 1, the shares or units of Pledged Equity constitute all the issued and outstanding equity of each Issuer.

(g) All the shares or units of the Pledged Equity have been duly and validly issued and are fully paid and nonassessable.

(h) Such Pledgor is the record and beneficial owner of, and has good and marketable title to, the Pledged Equity, free of any and all Liens or options in favor of, or claims of, any other Person, except the security interest created by this Agreement or, in favor of the Senior Lender.

(i) (A) The terms of each of the certificates or other instruments representing Equity in a limited liability company or partnership that is or will be pledged hereunder expressly provides or will provide (no later than sixty (60) days after the date hereof) that it is a security governed by Article 8 of the Uniform Commercial Code as in effect in each applicable jurisdiction; (B) pursuant to the terms of its Governing Documents, (1) the related Issuer has elected or will elect (no later than sixty (60) days after the date hereof) for its Equity securities to be governed by Article 8 of the Uniform Commercial Code as in effect in each applicable jurisdiction, (2) to the extent within such Pledgor’s control, each Equity security of such Issuer shall or will bear a legend stating such election, (3) the provisions of such Governing Document setting forth the items in clauses (1) and (2) above (collectively, the “Opt-In Clauses”) are not subject to amendment and any purported amendment shall be null and void by its terms; and (C) such terms are in full force and effect or will be in full force and effect on the date any such Equity security is pledged hereunder.

5. Covenants

Each of the Pledgors covenants and agrees with the Collateral Agent and Purchaser that, from and after the date of this Agreement until this Agreement is terminated and the security interests created hereby are released, subject to the terms of the Intercreditor Agreement:

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(a) Subject to Section 6 hereof, if such Pledgor shall, as a result of its ownership of the Pledged Equity, become entitled to receive or shall receive any equity certificate (including, without limitation, any certificate representing an equity interest dividend or a distribution in connection with any reclassification, increase or reduction of capital or any certificate issued in connection with any reorganization), option or rights, whether in addition to, in substitution of, as a conversion of, or in exchange for any shares or units of the Pledged Equity, or otherwise in respect thereof, such Pledgor shall accept the same as the agent of the Collateral Agent and Purchaser and deliver the same forthwith to the Collateral Agent in the exact form received, duly endorsed by such Pledgor to the Collateral Agent, if required, together with an undated equity interest power covering such certificate duly executed in blank by such Pledgor and with, if the Collateral Agent so requests, signature guaranteed, to be held by the Collateral Agent, subject to the terms hereof, as additional collateral security for the Obligations. Subject to Section 6 hereof, (1) any sums paid upon or in respect of the Pledged Equity upon the liquidation or dissolution of any Issuer shall be paid over to the Collateral Agent to be held by it hereunder as additional collateral security for the Obligations, (2) in case any distribution of capital shall be made on or in respect of the Pledged Equity or any property shall be distributed upon or with respect to the Pledged Equity pursuant to the recapitalization or reclassification of the capital of any Issuer or pursuant to the reorganization thereof, the property so distributed shall be delivered to the Collateral Agent to be held by it hereunder as additional collateral security for the Obligations and (3) any sums of money or property so paid or distributed in respect of the Pledged Equity shall be received by such Pledgor, such Pledgor shall promptly pay or deliver such money or property to the Collateral Agent (no later than three (3) days after the receipt of the same) and, until such money or property is paid or delivered to the Collateral Agent, hold such money or property as additional collateral security for the Obligations.

(b) Without the prior written consent of the Collateral Agent, such Pledgor will not (1) vote to enable, or take any other action to permit, any Issuer to issue any equity securities of any nature or to issue any other securities convertible into or granting the right to purchase or exchange for any equity securities of any nature of any Issuer, (2) sell, assign, transfer, exchange, or otherwise enter into a derivatives transaction or otherwise hedge or dispose of, or grant any option with respect to, the Collateral, (3) create, incur or permit to exist any Lien or option in favor of, or any claim of any Person with respect to, any of the Collateral, or any interest therein, except for the security interests created by this Agreement or in favor of the Senior Lender or (4) enter into any agreement or undertaking (other than as may be required by law) restricting the right or ability of such Pledgor or the Collateral Agent to sell, assign or transfer any of the Collateral.

(c) Such Pledgor shall maintain the security interest created by this Agreement, subject to the provisions of the Intercreditor Agreement, as a first priority, perfected security interest and shall defend such security interest against claims and demands of all Persons whomsoever except to the security interest of the Senior Lender. At any time and from time to time, upon the written request of the Collateral Agent, and at the sole expense of such Pledgor, such Pledgor will promptly and duly execute and deliver such further instruments and documents and take such further actions as the Collateral Agent may reasonably request for the purposes of obtaining or preserving the full benefits of this Agreement and of the rights and powers herein granted. If any amount payable under or in connection with any of the Collateral shall be or become evidenced by any promissory note, other instrument or chattel paper, such note,

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instrument or chattel paper shall be immediately delivered to the Collateral Agent, duly endorsed in a manner satisfactory to the Collateral Agent, to be held as Collateral pursuant to this Agreement.

(d) Such Pledgor shall pay, and save the Collateral Agent and Purchaser harmless from, any and all liabilities with respect to, or resulting from any delay in paying, any and all stamp, excise, sales or other Taxes which may be payable or determined to be payable with respect to any of the Collateral or in connection with any of the transactions contemplated by this Agreement.

(e) Such Pledgor shall (i) pledge to the Collateral Agent, for the benefit of the Collateral Agent and of Purchaser, any Equity it acquires in a new Subsidiary from time to time after the Closing Date by delivering to the Collateral Agent a supplement to Schedule 1 attached hereto and (ii) cause any Subsidiary not party to this Agreement to become a party to this Agreement upon the acquisition by such Subsidiary of a new Subsidiary and to pledge its Equity in such new Subsidiary to the Collateral Agent, for the benefit of the Collateral Agent and Purchaser.

(f) Such Pledgor shall not agree to any amendment or repeal of any Opt-In Clauses without the prior express written consent of the Collateral Agent and, in any event, shall promptly notify the Collateral Agent in writing if for any reason the related Pledged Equity ceases to be a security for purposes of the UCC in any applicable jurisdiction.

6. Cash Dividends; Voting Rights

Unless an Event of Default shall have occurred and be continuing and the Collateral Agent shall have given notice to the Pledgors of the Collateral Agent’s intent to exercise its corresponding rights pursuant to Section 9 below, each Pledgor shall be permitted to receive all cash dividends paid in the normal course of business of the Issuers and consistent with past practice, to the extent permitted in the Purchase Agreement, in respect of the Pledged Equity and to exercise all voting and organizational rights with respect to the Pledged Equity; provided, however, that no vote shall be cast or organizational right exercised or other action taken which, in the Collateral Agent’s reasonable judgment, would materially impair the Collateral or which would be materially inconsistent with or result in any violation of any provision of the Purchase Agreement, the Note, this Agreement or any other Transaction Document.

7. Rights of Purchaser and the Collateral Agent

(a) All money Proceeds received by the Collateral Agent hereunder shall be held by the Collateral Agent, for the benefit of the Collateral Agent and of Purchaser, in a Payment Account. All Proceeds while held by the Collateral Agent in a Payment Account (or by any Pledgor in trust for the Collateral Agent and Purchaser) shall continue to be held as collateral security for all the Obligations and shall not constitute payment thereof until applied as provided in Section 26(m)(ii) of the Security Agreement.

(b) If an Event of Default shall occur and be continuing and the Collateral Agent shall give notice of its intent to exercise such rights to the Pledgors, (1) the Collateral Agent shall have the right to receive any and all cash dividends paid in respect of the Pledged Equity and

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make application thereof to the Obligations in such order as the Collateral Agent may determine, and (2) all shares or units of the Pledged Equity shall be registered in the name of the Collateral Agent or its nominee, and the Collateral Agent or its nominee may thereafter exercise (A) all voting, organizational and other rights pertaining to such shares or units of the Pledged Equity at any meeting of equityholders of any Issuer or otherwise and (B) any and all rights of conversion, exchange, subscription and any other rights, privileges or options pertaining to such shares or units of the Pledged Equity as if it were the absolute owner thereof (including, without limitation, the right to exchange at its discretion any and all of the Pledged Equity upon the merger, consolidation, reorganization, recapitalization or other fundamental change in the corporate structure of any Issuer, or upon the exercise by any Pledgor or the Collateral Agent of any right, privilege or option pertaining to such shares or units of the Pledged Equity, and in connection therewith, the right to deposit and deliver any and all of the Pledged Equity with any committee, depositary, transfer Collateral Agent, registrar or other designated agency upon such terms and conditions as the Collateral Agent may determine), all without liability except to account for property actually received by it, but the Collateral Agent shall have no duty to any Pledgor to exercise any such right, privilege or option and shall not be responsible for any failure to do so or delay in so doing.

8. Consent

Each Pledgor which is either an issuer or an owner of any Pledged Equity hereby consents to the grant by each other Pledgor of the security interest hereunder in favor of the Collateral Agent and to the transfer of any Pledged Equity to the Collateral Agent or its designee following an Event of Default and to the substitution of the Collateral Agent or its designee as a partner, member or shareholder of the issuer of the related Pledged Equity. Each Pledgor shall cause each issuer of any Pledged Equity to execute and deliver to the Collateral Agent an acknowledgement substantially in the form of Exhibit A hereto.

9. Remedies

(a) If an Event of Default shall have occurred and be continuing, at any time at the Collateral Agent’s election, the Collateral Agent may apply all or any part of Proceeds held in any Payment Account in payment of the Obligations in such order as the Collateral Agent may elect.

(b) If an Event of Default shall occur and be continuing, the Collateral Agent, on behalf of Purchaser, may exercise, in addition to all other rights and remedies granted in this Agreement and in any other instrument or agreement securing, evidencing or relating to the Obligations, all rights and remedies of a secured party under the UCC or other applicable law or in equity. Without limiting the generality of the foregoing, the Collateral Agent, without demand of performance or other demand, presentment, protest, advertisement or notice of any kind (except any notice required by law referred to below) to or upon any Pledgor or any other Person (all and each of which demands, defenses, advertisements and notices are hereby waived), may in such circumstances forthwith collect, receive, appropriate and realize upon the Collateral, or any part thereof, and/or may forthwith sell, assign, give an option or options to purchase or otherwise dispose of and deliver the Collateral or any part thereof (or contract to do any of the foregoing), in one or more parcels at public or private sale or sales, in the over-the-counter

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market, at any exchange, broker’s board or office of the Collateral Agent or Purchaser or elsewhere upon such terms and conditions as it may deem advisable and at such prices as it may deem best, for cash or on credit or for future delivery without assumption of any credit risk. The Collateral Agent or Purchaser shall have the right upon any such public sale or sales, and, to the extent permitted by law, upon any such private sale or sales, to purchase the whole or any part of the Collateral so sold, free of any right or equity of redemption in the Pledgors, which right or equity is hereby waived or released. The Collateral Agent shall apply any Proceeds from time to time held by it and the net proceeds of any such collection, recovery, receipt, appropriation, realization or sale, after deducting all Purchasers’ Expenses in any way relating to the Collateral or the rights of the Collateral Agent and Purchaser hereunder, to the payment in whole or in part of the Obligations, in such order as the Collateral Agent may elect, and only after such application and after the payment by the Collateral Agent of any other amount required by any provision of law, including, without limitation, Section 9-615 of the UCC, need the Collateral Agent account for the surplus, if any, to the Pledgors. To the extent permitted by applicable law, each of the Pledgors waives all claims, damages and demands it may acquire against the Collateral Agent or Purchaser arising out of the exercise by them of any rights hereunder. If any notice of a proposed sale or other disposition of Collateral shall be required by law, such notice shall be deemed reasonable and proper if given at least ten (10) days before such sale or other disposition.

(c) Each of the Pledgors shall remain liable for any deficiency if the proceeds of any sale or other disposition of Collateral are insufficient to pay the Obligations and the reasonable fees and disbursements of any attorneys employed by the Collateral Agent or Purchaser to collect such deficiency.

10. Resales of Pledged Equity

(a) Each of the Pledgors will cause the Issuer thereof to execute and deliver, and cause the directors and officers of such Issuer to execute and deliver, all such instruments and documents, and do or cause to be done all such other acts as may be, in the opinion of the Collateral Agent, necessary or advisable to permit the Pledged Equity, or any portion thereof, to be sold under the provisions of the Securities Act relating to resales of securities absent registration thereunder.

(b) Each of the Pledgors recognizes that the Collateral Agent may be compelled to resort to one or more private sales thereof to a restricted group of purchasers which will be obliged to agree, among other things, to acquire such securities for their own account for investment and not with a view to the distribution or resale thereof. Each of the Pledgors acknowledges and agrees that any such private sale may result in prices and other terms less favorable than if such sale were a public sale and, notwithstanding such circumstances, agrees that any such private sale shall be deemed to have been made in a commercially reasonable manner. The Collateral Agent shall be under no obligation to delay a sale of any of the Pledged Equity for the period of time necessary to permit the Issuer thereof to register such securities for public sale under the Securities Act, or under applicable state securities laws, even if such Issuer would agree to do so.

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(c) Each of the Pledgors further agrees to use its commercially reasonable best efforts to do or cause to be done all such other acts as may be necessary to make such sale or sales of all or any portion of the Pledged Equity pursuant to this Section 10 valid and binding and in compliance with any and all other applicable requirements. Each of the Pledgors further agrees that a breach of any of the covenants contained in this Section 10 will cause irreparable injury to the Collateral Agent and Purchaser, that the Collateral Agent and Purchaser have no adequate remedy at law in respect of such breach and, as a consequence, that each and every covenant contained in this Section 10 shall be specifically enforceable against each of the Pledgors, and each of the Pledgors hereby waives and agrees not to assert any defenses against an action for specific performance of such covenants except for a defense that no Event of Default has occurred under the Purchase Agreement.

11. Irrevocable Authorization and Instruction to Issuer

Each of the Pledgors hereby authorizes and instructs each Issuer to comply with any instruction received by it from the Collateral Agent in writing that (a) states that an Event of Default has occurred and (b) is otherwise in accordance with the terms of this Agreement, without any other or further instructions from such Pledgor, and such Pledgor agrees that each Issuer shall be fully protected in so complying.

12. Collateral Agent’s Appointment as Attorney-in-Fact

(a) Subject to the Intercreditor Agreement, each of the Pledgors hereby irrevocably constitutes and appoints the Collateral Agent and any officer of the Collateral Agent, with full power of substitution, as its true and lawful attorney-in-fact with full irrevocable power and authority in the place and stead of such Pledgor and in the name of such Pledgor or in the Collateral Agent’s own name, from time to time in the Collateral Agent’s discretion, for the purpose of carrying out the terms of this Agreement, to take any and all appropriate action and to execute any and all documents and instruments which may be necessary or desirable to accomplish the purposes of this Agreement, including, without limitation, any financing statements, endorsements, assignments or other instruments of transfer.

(b) Each of the Pledgors hereby ratifies all that said attorneys shall lawfully do or cause to be done pursuant to the power of attorney granted in Section 12(a). All powers, authorizations and agencies contained in this Agreement are coupled with an interest and are irrevocable until this Agreement is terminated and the security interests created hereby are released.

13. Duty of Collateral Agent

The Collateral Agent’s sole duty with respect to the custody, safekeeping and physical preservation of the Collateral in its possession, under Section 9-207 of the UCC or otherwise, shall be to deal with it in the same manner as the Collateral Agent deals with similar securities and property for its own account, except that the Collateral Agent shall have no obligation to invest funds held in any Payment Account and may hold the same as demand deposits. Except as provided in Section 9-207 of the UCC, neither the Collateral Agent, Purchaser nor any of their respective directors, officers, employees or agents shall be liable for failure to demand, collect or realize upon any of the Collateral or for any delay in doing so or shall be under any obligation to

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sell or otherwise dispose of any Collateral upon the request of the Pledgors or any other Person or to take any other action whatsoever with regard to the Collateral or any part thereof.

14. Authorization of Financing Statements

Pursuant to Section 9-102 of the UCC, the Pledgors authorize the Collateral Agent to file financing statements with respect to the Collateral in such form and in such filing offices as the Collateral Agent reasonably determines appropriate to perfect the security interests of the Collateral Agent under this Agreement. A carbon, photographic or other reproduction of this Agreement shall be sufficient as a financing statement for filing in any jurisdiction.

15. Authority of the Collateral Agent

Each of the Pledgors acknowledges that the rights and responsibilities of the Collateral Agent under this Agreement with respect to any action taken by the Collateral Agent or the exercise or non-exercise by the Collateral Agent of any option, voting right, request, judgment or other right or remedy provided for herein or resulting or arising out of this Agreement shall, as between the Collateral Agent and Purchaser, be governed by the Purchase Agreement and by such other agreements with respect thereto as may exist from time to time among them, but, as between the Collateral Agent and the Pledgors, the Collateral Agent shall be conclusively presumed to be acting as collateral agent for Purchaser with full and valid authority so to act or refrain from acting, and neither the Pledgors nor any Issuer shall be under any obligation, or entitlement, to make any inquiry respecting such authority.

16. Notices

Except as otherwise provided herein, whenever it is provided herein that any notice, demand, request, consent, approval, declaration or other communication shall or may be given to or served upon any of the parties by any other party, or whenever any of the parties desires to give and serve upon any other party any communication with respect to this Agreement, each such notice, demand, request, consent, approval, declaration or other communication shall be in writing and shall be given to the Company on behalf of the Pledgors and the Issuers in the manner, and deemed received, as provided for in the Purchase Agreement.

17. Severability

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.

18. Amendments in Writing; No Waiver; Cumulative Remedies

(a) None of the terms or provisions of this Agreement may be waived, amended, supplemented or otherwise modified except by a written instrument executed by the Pledgors and the Collateral Agent; provided, that any provision of this Agreement may be waived by the

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Collateral Agent and Purchaser in a letter or agreement executed by the Collateral Agent or by telex or facsimile transmission from the Collateral Agent.

(b) Neither the Collateral Agent nor Purchaser shall by any act (except by a written instrument pursuant to paragraph (a) hereof), delay, indulgence, omission or otherwise be deemed to have waived any right or remedy hereunder or to have acquiesced in any Default or Event of Default or in any breach of any of the terms and conditions hereof. No failure to exercise, nor any delay in exercising, on the part of the Collateral Agent or Purchaser, any right, power or privilege hereunder shall operate as a waiver thereof. No single or partial exercise of any right, power or privilege hereunder shall preclude any other or further exercise thereof or the exercise of any other right, power or privilege. A waiver by the Collateral Agent or Purchaser of any right or remedy hereunder on any one occasion shall not be construed as a bar to any right or remedy which the Collateral Agent or Purchaser would otherwise have on any future occasion.

(c) The rights and remedies herein provided are cumulative, may be exercised singly or concurrently and are not exclusive of any other rights or remedies provided by law.

19. Section Headings

The section headings used in this Agreement are for convenience of reference only and are not to affect the construction hereof or be taken into consideration in the interpretation hereof.

20. Successors and Assigns

This Agreement shall be binding upon the successors and assigns of the Pledgor and shall inure to the benefit of the Collateral Agent and Purchaser and their respective successors and assigns.

21. Governing Law

THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

(Signature Page Follows)

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IN WITNESS WHEREOF, the undersigned has caused this Agreement to be duly executed and delivered as of the date first above written.

“Pledgor”
IMPCO TECHNOLOGIES, INC., a Delaware corporation
By:
	Name:
	Title:

EXHIBIT A

ACKNOWLEDGEMENT AND CONSENT

The undersigned hereby acknowledges receipt of a copy of the Pledge Agreement dated July 18, 2003, made by the Pledgors (as defined therein) for the benefit of Bison Capital Structured Equity Partners, LLC, as Collateral Agent (the “Pledge Agreement”). The undersigned agrees for the benefit of the Collateral Agent and of Purchaser as follows:

1. The undersigned will be bound by the terms of the Pledge Agreement and will comply with such terms insofar as such terms are applicable to the undersigned.

2. The undersigned confirms the statements made in the Pledge Agreement with respect to the undersigned including, without limitation, in Sections 4(f), (g), (h) and, if applicable, (i) and Schedule 1.

3. The undersigned will notify the Collateral Agent promptly in writing of the occurrence of any of the events described in paragraph 5(a) of the Pledge Agreement.

3. The terms of Sections 6 and 10 of the Pledge Agreement shall apply to it, mutatis mutandis, with respect to all actions that may be required of it under or pursuant to or arising out of Sections 6 and 10 of the Pledge Agreement.

[ISSUER]
By:
	Name:
	Title:
	Address for Notices:
	Fax:

SCHEDULE 1

TO PLEDGE AGREEMENT

DESCRIPTION OF PLEDGED EQUITY

Issuer Issuer’s Jurisdiction Under UCC Section 9-305(a)(1) Class of Equity* Equity Certificate No. Percentage of Shares
or Units No. of Shares or
Units

* Equity is assumed to be common equity unless otherwise indicated.

EX-10.74

Exhibit 10.74

COMMON STOCK

WARRANT AGREEMENT

BY AND BETWEEN

IMPCO TECHNOLOGIES, INC.

AND

BISON CAPITAL STRUCTURED EQUITY PARTNERS, LLC

DATED AS OF JULY [    ], 2003

TABLE OF CONTENTS

		Page
SECTION 1.	Sale and Purchase of Warrant	1
SECTION 2.	Investment Representations	1
SECTION 3.	Warrant Certificate	2
SECTION 4.	Registration	3
SECTION 5.	Registration of Transfers and Exchanges.	3
SECTION 6.	Warrant; Exercise of Warrant.	4
SECTION 7.	Payment of Taxes	5
SECTION 8.	Mutilated or Missing Warrant Certificate	5
SECTION 9.	Reservation of Warrant Securities	5
SECTION 10.	Adjustment of Exercise Price and Number of Warrant Securities Issuable	6
SECTION 11.	Capitalization; Adjustment to the Number of Warrant Securities	14
SECTION 12.	Financial Statements; Other Documents	15
SECTION 13.	Notices to Warrant Holders	15
SECTION 14.	Survival of Rights	16
SECTION 15.	Notices to Company and Warrant Holder	16
SECTION 16.	Consents and Best Efforts	17
SECTION 17.	Successors	18
SECTION 18.	Governing Law	18
SECTION 19.	Benefits of This Agreement	18
SECTION 20.	Interpretation	18
SECTION 21.	Counterparts	18
ANNEX 1		A-1

i

THIS COMMON STOCK WARRANT AGREEMENT (the “Agreement”) is dated as of July [    ], 2003 and entered into by and between IMPCO TECHNOLOGIES, INC., a Delaware corporation (“Company”), and BISON CAPITAL STRUCTURED EQUITY PARTNERS, LLC, a Delaware limited liability company (“Warrant Holder”).

RECITALS

WHEREAS, pursuant to that certain Securities Purchase Agreement, dated as of July [    ], 2003 (as amended, restated, supplemented or otherwise modified from time to time, the “Purchase Agreement”) by and between Company and Warrant Holder, Company has agreed to issue to Warrant Holder a Common Stock Warrant, as hereinafter described (the “Warrant”), to purchase 500,000 shares of common stock, $0.001 par value per share, of the Company (the “Common Stock”) (the Common Stock issuable upon exercise of the Warrant being referred to herein as the “Warrant Securities”). Capitalized terms used but not defined in this Agreement shall have the meanings given such terms in the Purchase Agreement, as in effect on the date hereof.

NOW, THEREFORE, in consideration of the premises and the mutual agreements herein set forth, the parties hereto agree as follows:

SECTION 1. Issuance of Warrant. In consideration of monies provided by Warrant Holder to Company pursuant to the Purchase Agreement, and subject to the conditions and restrictions contained in this Agreement and in the Purchase Agreement, Company hereby agrees to issue the Warrant to Warrant Holder.

SECTION 2. Investment Representations. Warrant Holder represents and warrants to Company as follows:

(a) This Agreement, when executed and delivered by Warrant Holder, will constitute valid and legally binding obligations of Warrant Holder, enforceable in accordance with its terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, and any other laws of general application affecting enforcement of creditors’ rights generally, and as limited by laws relating to the availability of a specific performance, injunctive relief, or other equitable remedies, or (b) to the extent to the indemnification provisions contained in the Registration Rights Agreement may be limited by applicable federal or securities laws.

(b) Warrant Holder is acquiring the Warrant for investment for its own account and not with a view to or for sale in connection with any distribution of the Warrant or the Warrant Securities in violation of the Securities Act of 1933, as amended (the “Securities Act”), or any other applicable federal or state securities laws and Warrant Holder has no present intention of selling, granting any participation in, or otherwise distributing the Warrant or the Warrant Securities.

(c) Warrant Holder (i) is familiar with the business management and financial affairs of Company, (ii) has had an opportunity to discuss with representatives of Company the condition of and any prospects for the continued operation and financing of Company and such other matters as Warrant Holder has deemed appropriate in considering whether to invest in the

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Warrant, (iii) has had an opportunity to review Company’s facilities, and (iv) has been provided access to all available information about Company requested by Warrant Holder.

(d) Warrant Holder understands that the Warrant and the Warrant Securities have not been registered under the Securities Act, or registered or qualified under the securities laws of any state and that Warrant Holder may not sell or otherwise transfer the Warrant or Warrant Securities unless they are subsequently registered under the Securities Act and registered or qualified under applicable state securities laws, or unless an exemption is available which permits sale or other transfer without such registration and qualification. Warrant Holder acknowledges that the Warrant Securities must be held indefinitely unless subsequent registration under the Securities Act or an exemption from such registration is available. Warrant Holder is aware of the provision of Rule 144 promulgated under the Securities Act which permits limited resale of the Warrant Securities subject to the satisfaction of certain conditions, including, among other things, the existence of a public market for the Warrant Securities, the availability of certain public information about Company, the resale occurring not less than one year after Warrant Holder has purchased and paid for the Warrant Securities, the sale being effected through a “broker transaction” or in a transaction directly with a “Marketmaker” (as provided by Rule 144(f) and the number of shares being sold during any three-month period not exceeding specified limitations.

(e) Warrant Holder understands that the Warrant Securities, and any securities issued in respect thereof or exchange therefor, may bear one or more legends in substantially the following form:

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED OR OTHERWISE DISPOSED OF WITHOUT (i) AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO, (ii) AN OPINION OF COUNSEL (SUCH COUNSEL TO BE REASONABLY SATISFACTORY TO COMPANY) THAT SUCH REGISTRATION IS NOT REQUIRED, OR (iii) RECEIPT OF NO ACTION LETTERS FROM THE APPROPRIATE GOVERNMENTAL AUTHORITIES.

Notwithstanding the foregoing, this Section 2(e) shall not apply to the Warrant Securities, and any securities issued in respect thereof or exchange therefor, if (A) a registration statement related thereto is effective as of the date of the issuance or Transfer (as defined below) of such Warrant Securities and any securities issued in respect thereof or exchange therefor or (B) such Warrant Securities, and any securities issued in respect thereof or exchange therefor, are sold, assigned, transferred, pledged, hypothecated, or otherwise disposed pursuant to Rule 144 under the Securities Act.

(f) Warrant Holder is an accredited investor as defined in Rule 501(a) of Regulation D promulgated under the Securities Act.

SECTION 3. Warrant Certificate. The certificate evidencing the Warrant (the “Warrant Certificate”) to be delivered pursuant to this Agreement shall be in registered form only and shall be substantially in the form set forth in Annex 1 attached hereto.

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SECTION 4. Registration. Company shall number and register the Warrant Certificate in a register as it is issued.

SECTION 5. Registration of Transfers and Exchanges.

(a) Prior to any Transfer (as defined below) or attempted Transfer of the Warrant, unless the Transfer is made pursuant to Rule 144 under the Securities Act or an effective registration statement under the Securities Act, the holder of the Warrant shall obtain from counsel to such Warrant Holder (who may be an employee of such Warrant Holder) who shall be reasonably satisfactory to Company, an opinion that the proposed transfer of such Warrant may be effected without registration under the Securities Act; provided, however, that an opinion from counsel shall not be required in connection with any Transfer of the Warrant to an Affiliate of such Warrant Holder. Each Warrant issued upon such transfer shall bear the restrictive legends set forth on the Warrant Certificate attached hereto as Annex 1, unless, with respect to the first such legend, (i) the Transfer is made pursuant to Rule 144 under the Securities Act or pursuant to an effective registration statement under the Securities Act, or (ii) in the opinion of any such counsel such legend is not required in order to ensure compliance with the Securities Act. As used herein, “Transfer” means sell, assign, transfer, pledge, hypothecate, mortgage, encumber, dispose by gift or bequest, or otherwise transfer or dispose.

(b) Subject to Section 5(a), Company shall from time to time register the transfer of the Warrant Certificate in a Warrant register to be maintained by Company upon surrender of such Warrant Certificate accompanied by a written instrument or instruments of transfer in form reasonably satisfactory to Company, duly executed by the registered holder or holders thereof or by the duly appointed legal representative thereof or by a duly authorized attorney. Upon any such registration of transfer, a new Warrant Certificate shall be issued to the transferee(s) and the surrendered Warrant Certificate shall be cancelled and disposed of by Company. The Warrant Certificate may be exchanged at the option of Warrant Holder, when surrendered to Company at its office, for another Warrant Certificate or other Warrant Certificates of like tenor and representing in the aggregate a like number of Warrant Securities. Warrant Certificates surrendered for exchange shall be cancelled and disposed of by Company.

(c) Notwithstanding Sections 5(a) and 5(b), Warrant Holder shall not transfer or attempt to transfer this Warrant in an amount representing a right to acquire less than 50% of the Warrant Securities. For purposes of this Section 5(c), the term “transfer” shall be deemed to include any sale, pledge, hypothecation, hedge, put or call option, straddle or collar, or any similar transaction respecting this Warrant or (subject to the proviso in clause (i) below) the Warrant Securities, or any offer to do any of the foregoing; provided, however, that (i) transfers of Warrant Securities following exercise of this Warrant shall not be so restricted and (ii) no transfer shall be deemed to have occurred in connection with the transfer of all or any part of this Warrant in connection with the pro rata distribution hereof to the equity holders of Warrant Holder made for purposes other than the circumvention of the transfer restrictions contemplated hereby.

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SECTION 6. Warrant; Exercise of Warrant.

(a) Subject to the terms of this Agreement, Warrant Holder shall have the right, which may be exercised commencing on the Closing Date and until 5:00 p.m., Los Angeles time, on the 10^th anniversary of such date (the “Exercise Period”), to receive from Company the number of fully paid and nonassessable Warrant Securities which Warrant Holder may at the time be entitled to receive on exercise of such Warrant and payment to Company of the Exercise Price (as defined below) then in effect for such Warrant Securities. In the alternative, Warrant Holder may exercise its right, during the Exercise Period, to receive Warrant Securities on a net basis, such that, without the exchange of any funds, such Warrant Holder receives that number of Warrant Securities otherwise issuable (or payable) upon exercise of its Warrant less that number of Warrant Securities having a Current Market Price (as defined in Section 10(g) (1)) one Business Day prior to the time of exercise equal to the aggregate Exercise Price that would otherwise have been paid by such holder of Warrant Securities. If not exercised within the Exercise Period, the Warrant shall become void and all rights thereunder and all rights in respect thereof under this Agreement shall cease as of such time.

(b) The Warrant may be exercised upon written notice of surrender to Company at its office designated for such purpose (the address of which is set forth in Section 16 hereof) the certificate or certificates evidencing the Warrant to be exercised with the form of election to purchase duly filled in and signed, and upon payment to Company of the exercise price per share of Common Stock (the “Exercise Price”) which is set forth in the form of Warrant Certificate attached hereto as Annex 1, subject to adjustment pursuant to Section 10 hereof, for the number of Warrant Securities in respect of which such Warrant is then exercised. Payment of the aggregate Exercise Price shall be made, at Warrant Holder’s option (i) in cash in immediately available funds or by certified or official bank check payable to the order of Company, (ii) in the manner provided in the second sentence of Section 6(a) or (iii) by assigning to Company all or any part of the unpaid principal amount of the Note held by the applicable Warrant Holder in a principal amount equal to the Exercise Price. If, pursuant to clause (iii) above, less than the entire unpaid principal amount of the Note shall be applied toward payment of the consideration payable upon any exercise of the Warrant, Warrant Holder shall surrender the Note and Company shall (1) pay to Warrant Holder the amount of unpaid interest accrued to the date of surrender on the portion of the principal amount of the Note which has been applied toward the Warrant Price, such payment to be in the form of a certified or official bank check or checks, and (2) issue a new Note (dated the date of the Note being surrendered) representing the balance of the unpaid principal amount of the Note so surrendered, payable to Warrant Holder or as Warrant Holder may otherwise direct.

(c) Upon receipt of such written notice of surrender of the Warrant and payment of the Exercise Price (or simply upon receipt of such written notice of surrender of the Warrant alone if Warrant Holder exercises the Warrant in the manner provided in the second sentence of Section 6(a)), Company shall issue and cause to be delivered within five (5) Business Days to or upon the written order of Warrant Holder and in such name or names as Warrant Holder may designate, a certificate or certificates for the number of full Warrant Securities issuable upon the exercise of such Warrant. Subject to Section 5(a), such certificate or certificates shall be deemed to have been issued and any person so designated to be named therein shall be deemed to have become a holder of record of such Warrant Securities as of the

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date of the surrender of such Warrant and payment of the Exercise Price (or simply upon receipt of such written notice of surrender of the Warrant alone if Warrant Holder exercises the Warrant in the manner provided in the second sentence of Section 6(a)).

(d) The Warrant shall be exercisable, at the election of Warrant Holder, either in full or from time to time in part and, in the event that a certificate evidencing a Warrant is exercised in respect of fewer than all of the Warrant Securities issuable on such exercise at any time prior to the date of expiration of the Warrant, a new Warrant Certificate evidencing the right to receive the remaining Warrant Securities will be issued and delivered pursuant to the provisions of this Section.

(e) The Warrant shall also be conditionally exercisable, at the election of Warrant Holder, so that if Warrant Holder exercises the Warrant in contemplation of the consummation of a transaction described in any of clauses (a) - (g) of Section 14 and such transaction is not consummated, Warrant Holder may elect to revoke such exercise, in which case such Warrant shall be deemed not to have been so exercised.

(f) Any Warrant Certificate surrendered upon exercise of a Warrant shall be cancelled and disposed of by Company. Company shall keep copies of this Agreement and any notices given or received hereunder available for inspection by Warrant Holder during normal business hours at its principal office.

(g) No fractional shares or scrip representing fractional shares shall be issued upon the exercise of the Warrant, but in lieu of such fractional shares Company shall make a cash payment therefor on the basis of the Current Market Price then in effect.

SECTION 7. Payment of Taxes. Company shall pay all documentary stamp taxes attributable to the initial issuance of Warrant Securities upon the exercise of the Warrant; provided, however, that Company shall not be required to pay any tax or taxes which may be payable in respect of any transfer involved in the issuance of any Warrant Certificate or any certificates for Warrant Securities in a name other than that of the registered holder of the Warrant Certificate surrendered upon the exercise of the Warrant, and Company shall not be required to issue or deliver such Warrant Certificate unless or until the person or persons requesting the issuance thereof shall have paid to Company the amount of such tax or shall have established to the reasonable satisfaction of Company that such tax has been paid.

SECTION 8. Mutilated or Missing Warrant Certificate. In case a Warrant Certificate shall be mutilated, lost, stolen or destroyed, Company may in its discretion issue, in exchange and substitution for and upon cancellation of the mutilated Warrant Certificate, or in lieu of and substitution for the Warrant Certificate lost, stolen or destroyed, a new Warrant Certificate of like tenor and representing an equivalent number of Warrant Securities, but only upon receipt of evidence reasonably satisfactory to Company of such loss, theft or destruction of such Warrant Certificate and indemnity, if requested, also reasonably satisfactory to it.

SECTION 9. Reservation of Warrant Securities. Company shall at all times reserve and keep available, free from preemptive and other similar rights out of the aggregate of its authorized but unissued Common Stock or its authorized and issued Common Stock held in its

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treasury, for the purpose of enabling it to satisfy any obligation to issue Warrant Securities upon exercise of the Warrant, the maximum number of shares of Common Stock which may then be deliverable upon the exercise of the Warrant.

Before taking any action which would cause an adjustment pursuant to Section 10 hereof to reduce the Exercise Price below the then par value (if any) of the Warrant Securities, Company will take any corporate action which may, in the opinion of its counsel, be necessary in order that Company may validly and legally issue fully paid and nonassessable Warrant Securities at the Exercise Price as so adjusted.

Company covenants that all Warrant Securities which may be issued upon exercise of the Warrant will, upon issue, be fully paid, nonassessable, free of preemptive and other similar rights and free from all taxes, liens, charges, security interests and adverse claims with respect to the issue thereof.

SECTION 10. Adjustment of Exercise Price and Number of Warrant Securities Issuable. The Exercise Price and the number of Warrant Securities issuable upon the exercise of the Warrant are subject to adjustment from time to time upon the occurrence of the events enumerated in this Section 10. For purposes of this Section 10, “Common Stock” means shares now or hereafter authorized of any class of common stock of Company and any other security of Company, however designated, that have the right to participate in any distribution of the assets or earnings of Company, excluding Preferred Stock. For purposes of this Agreement, “Preferred Stock” means shares now or hereafter authorized of capital stock of Company that have a preference in either the payment of dividends or the distribution of assets upon dissolution of Company.

(a) Adjustment for Change in Shares. If Company:

(1) pays a dividend or makes a distribution on its Common Stock in Common Stock;

(2) subdivides or reclassifies its outstanding Common Stock into a greater number of shares; or

(3) combines or reclassifies its outstanding Common Stock into a smaller number of shares;

then the Exercise Price shall be adjusted in accordance with the formula:

E’= E x O

             A

Where:

E’ = the adjusted Exercise Price.

E = the current Exercise Price.

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O = the number of shares of all classes of Common Stock outstanding prior to such action.

A = the number of shares of all classes of Common Stock outstanding immediately after such action.

In the case of a dividend or distribution the adjustment shall become effective immediately after the record date for determination of holders of shares of Common Stock entitled to receive such dividend or distribution, and in the case of a subdivision, combination or reclassification, the adjustment shall become effective immediately after the effective date of such corporate action.

If after an adjustment Warrant Holder upon exercise of the Warrant may receive shares of two or more classes of capital stock of Company, Company shall determine the allocation of the adjusted Exercise Price between the classes of capital stock. After such allocation, the exercise privilege, the number of shares issuable upon such exercise and the Exercise Price of each class of capital stock shall thereafter be subject to adjustment on terms comparable to those applicable to Common Stock in this Section 10.

Such adjustment shall be made successively whenever any event listed above shall occur.

(b) Adjustment for Rights Issue. If Company distributes or grants any rights, options or warrants to any holder of any class of its Common Stock entitling it at any time after the record date mentioned below to purchase Common Stock at a price per share less than the Current Market Price (as defined in Section 10(g)), the Exercise Price shall be adjusted in accordance with the formula:

	O + N x P
E’ = Ex	M
O+N

where:

E’  = the adjusted Exercise Price.

E   = the current Exercise Price.

O   = the number of shares of all classes of Common Stock outstanding on the record date.

N   = the number of additional shares of all classes of Common Stock issuable upon exercise of the rights, options or warrants offered.

P   = the exercise price per share of the additional shares issuable upon exercise of the rights, options or warrants.

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M  = the Current Market Price per share of Common Stock on the record date.

The adjustment shall be made successively whenever any such rights, options or warrants are issued and shall become effective immediately after the record date for the determination of stockholders entitled to receive the rights, options or warrants. If at the end of the period during which such rights, options or warrants are exercisable, (i) not all rights, options or warrants shall have been exercised or (ii) the exercise price per share for which Common Stock are issuable pursuant to such rights, options or warrants shall be increased or decreased solely by virtue of provisions therein contained for an automatic increase or decrease in such exercise price per share upon the occurrence of a specified date or event, then the Exercise Price shall be immediately readjusted to what it would have been if, in the case of clause (i) above, “N” in the above formula had been the number of shares actually issued or, in the case of clause (ii) above, “P” in the above formula had been the exercise price per share, as so increased or decreased, as the case may be.

This Section 10(b) does not apply to shares of Common Stock issued or issuable pursuant to options as awards granted to or to be granted to employees (other than executive officers or board members) and consultants of Company pursuant to broad-based employee stock incentive plans approved by Company’s Board of Directors.

(c) Adjustment for Certain Distributions. If Company distributes (including by way of share repurchases to the extent in excess of the Current Market Price per share) to any holder of any class of its Common Stock any of its assets (including, but not limited to, cash, debt securities, preferred shares, or any rights or warrants to purchase debt securities, preferred shares, assets or other securities of Company), the Exercise Price shall be adjusted in accordance with the formula:

E = Ex    M - F

                  M    

where:

E’  = the adjusted Exercise Price.

E  = the current Exercise Price.

M  = the Current Market Price per share of Common Stock on the record date mentioned below.

F  = the Fair Market Value (as defined in Section 10(g)) on the record date of the assets, securities, rights or warrants applicable to one share of Common Stock.

The adjustment shall be made successively whenever any such distribution is made and shall become effective immediately after the record date for the determination of stockholders entitled to receive the distribution.

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This Section 10(c) does not apply to (i) dividends or distributions in shares of Common Stock to holders of its Common Stock (which event is addressed in Section 10(a)), (ii) rights, options or warrants referred to in Section 10(b) and (iii) distributions by Company of ordinary quarterly cash dividends to all holders of its Common Stock, provided that timely notice of such distributions is given by Company to Warrant Holder pursuant to Section 14.

(d) Adjustment for Dilutive Issuances of Common Stock. If Company issues shares of any class of its Common Stock for a consideration per share less than the Current Market Price per share on the date Company fixes the offering price of such additional shares, the Exercise Price shall be adjusted in accordance with the formula:

                O +  P 

E’ = E x          M

                    A    

where:

E’  = the adjusted Exercise Price.

E  = the then current Exercise Price.

O  = the number of shares of all classes of Common Stock outstanding immediately prior to the issuance of such additional shares.

P  = the aggregate consideration received for the issuance of such additional shares.

M  = the Current Market Price per share on the date of issuance of such additional shares.

A  = the number of shares of all classes of Common Stock outstanding immediately after the issuance of such additional shares.

The adjustment shall be made successively whenever any such issuance is made, and shall become effective immediately after such issuance.

This Section 10(d) does not apply to: (1) any of the transactions described in subsections (a), (b) and (c) of this Section 10; (2) the exercise of the Warrant, or the conversion or exchange of other securities outstanding on the date of this Agreement that are convertible or exchangeable for Common Stock and were included in the calculation described in Section 12(b); (3) shares of Common Stock issued or issuable to employees (other than executive officers or board members) and consultants of Company pursuant to broad-based employee stock incentive plans approved by Company’s Board of Directors; or (4) shares of Common Stock issued upon the exercise of rights or warrants issued to the holders of Common Stock for which rights or warrants an adjustment has been made pursuant to Section 10(b) or Section 10(e).

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(e) Adjustment for Dilutive Convertible Securities Issue. If Company issues any securities convertible into or exchangeable for Common Stock (other than securities issued in transactions described in subsections (b) and (c) of this Section 10) for a consideration per Common Stock initially deliverable upon conversion or exchange of such securities less than the Current Market Price per share on the date of issuance of such securities, the Exercise Price shall be adjusted in accordance with this formula:

                O +  P 

E’ = E x          M

                    O+D    

where:

E’  = the adjusted Exercise Price.

E  = the then current Exercise Price.

O  = the number of shares of all classes of Common Stock outstanding immediately prior to the issuance of such securities.

P  = the aggregate consideration received for the issuance of such securities.

M  = the Current Market Price per share on the date of issuance of such securities.

D  = the maximum number of shares of all classes of Common Stock deliverable upon conversion of or in exchange for such securities at the initial conversion or exchange rate.

The adjustment shall be made successively whenever any such issuance is made, and shall become effective immediately after such issuance.

If (i) all of the Common Stock deliverable upon conversion or exchange of such securities have not been issued when such securities are no longer outstanding, or (ii) the exercise price per share for which Common Stock are issuable pursuant to such securities shall be increased or decreased solely by virtue of provisions therein contained for an automatic increase or decrease in such exercise price per share upon the occurrence of a specified date or event, then the Exercise Price shall promptly be readjusted to the Exercise Price which would then be in effect had the adjustment upon the issuance of such securities been made on the basis of, in the case of clause (i) above, the actual number of Common Stock issued upon conversion or exchange of such securities or, in the case of clause (ii) above, the exercise price per unit, as so increased or decreased, as the case may be.

This Section 10(e) does not apply to any of the transactions described in subsections (b) and (c) of this Section 10.

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(f) Adjustment to Ensure Continued Compliance with Nasdaq Listing Standards. In the event that Company’s issuance of the Warrant at the Exercise Price set forth in the form of the Warrant Certificate attached hereto as Annex 1 without first obtaining approval from Company’s stockholders would violate Rule 4350(i) of the Rules of the National Association of Securities Dealers, Inc. as determined by the staff of the Nasdaq Stock Market, Inc., then, automatically and without any further action required by Company or Warrant Holder, the Exercise Price shall be increased to $         per share, and then further reduced and/or increased for any other adjustments to the Exercise Price that have occurred (or should have occurred) since the date of the Agreement through the date of adjusting the Exercise Price pursuant to this Section 10(f).

(g) Certain Definitions.

(1) Current Market Price. The Current Market Price per Common Stock on any date is:

(i) if the Common Stock is not then registered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), then the Fair Market Value of a share of Common Stock based upon the Fair Market Value of 100% of Company’s equity securities if sold on the basis that Company is a going concern, without regard to any discount for the lack of liquidity, and assuming, if applicable, the exercise, conversion or exchange of all in-the-money warrants, convertible or exchangeable securities, options or other rights to subscribe for or purchase any additional shares of Company’s equity securities or securities convertible into or exchangeable or exercisable for, such shares; or

(ii) if the Common Stock is then registered under the Exchange Act, the average of the Quoted Prices of the Common Stock for 30 consecutive trading days commencing forty-five (45) trading days before the date in question. The “Quoted Price” of the Common Stock is the last reported sales price of the Common Stock as reported by the Nasdaq National Market, or if the Common Stock is listed on a national securities exchange, the last reported sales price of the Common Stock on such exchange (which shall be for consolidated trading if applicable to such exchange), or if neither so reported or listed, the last reported bid price of the Common Stock. In the absence of one or more such quotations, the Current Market Price of the Common Stock shall be determined as if the Common Stock were not registered under the Exchange Act.

(2) Fair Market Value. Fair Market Value means the value obtainable upon a sale in an arm’s length transaction to a third party under usual and normal circumstances, with neither the buyer nor the seller under any compulsion to act, with fairness to both, as determined by the Board of Directors (or the equivalent thereof) of Company (the “Board”) in good faith; provided, however, that if Warrant Holder shall dispute the Fair Market Value as determined by the Board, Warrant Holder may undertake to have it and Company retain an Independent Expert. The determination of Fair Market Value by the Independent Expert shall be final, binding and conclusive on Company and Warrant Holder. All costs and expenses of the Independent Expert shall be

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borne by Company if the final Fair Market Value as determined by the Independent Expert varies by more than 10% from the Fair Market Value as determined by the Board and shall be borne by Warrant Holder if the final Fair Market Value as determined by the Independent Expert varies by less then 10% from the Fair Market Value as determined by the Board.

(3) Independent Expert. “Independent Expert” means an investment banking firm of nationally recognized standing reasonably agreeable to Company and Warrant Holder which does not (and whose affiliates do not) have a direct or indirect financial interest in Warrant Holder, Company or any of their respective affiliates.

(h) Consideration Received. For purposes of any computation respecting consideration received pursuant to subsections (d) and (e) of this Section 10, the following shall apply:

(1) in the case of the issuance of Common Stock for cash, the consideration shall be the amount of such cash; provided, that in no case shall any deduction be made for any commissions, discounts or other expenses incurred by Company for any underwriting of the issue or otherwise in connection therewith;

(2) in the case of the issuance of Common Stock for a consideration in whole or in part other than cash, the consideration other than cash shall be deemed to be the Fair Market Value thereof;

(3) in the case of the issuance of securities convertible into or exchangeable or exercisable for shares, the aggregate consideration received therefor shall be deemed to be the consideration received by Company for the issuance of such securities plus the additional minimum consideration, if any (without giving effect to any net cashless exercise provisions), to be received by Company upon the conversion, exchange or exercise thereof (the consideration in each case to be determined in the same manner as provided in clauses (1) and (2) of this subsection).

(i) When Adjustment not Required. If Company shall take a record of the holders of its Common Stock for the purpose of entitling them to receive a dividend or distribution or subscription or purchase rights and shall, thereafter and before the distribution to members thereof, legally abandon its plan to pay or deliver such dividend, distribution, subscription or purchase rights, then thereafter no adjustment shall be required by reason of the taking of such record and any such adjustment previously made in respect thereof shall be rescinded and annulled; provided that, if Warrant Holder has exercised the Warrant in whole or in part after an adjustment has been made and prior to the legal abandonment of the event or action that caused such adjustment, such prior adjustment shall remain in effect with respect to such Warrant exercise.

(j) Notice of Adjustment. Whenever the Exercise Price is adjusted, Company shall provide the notices required by Section 13 hereof.

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(k) Voluntary Reduction. Company from time to time may reduce the Exercise Price by any amount for any period of time if the period is at least twenty (20) days and if the reduction is irrevocable during the period.

Whenever the Exercise Price is reduced, Company shall mail to the registered holder of the Warrant Certificate a notice of the reduction. Company shall mail the notice at least fifteen (15) days before the date the reduced Exercise Price takes effect. The notice shall state the reduced Exercise Price and the period it will be in effect.

A reduction of the Exercise Price does not change or adjust the Exercise Price otherwise in effect for purposes of subsections (a), (b), (c), (d) and (e) of this Section 10.

(l) Reorganization of Company. If any transaction constituting a Disposition Transaction shall be effected in such a way that holders of Common Stock of Company shall be entitled to receive stock, securities or assets with respect to or in exchange for such Common Stock, then, as a condition precedent to such transaction, lawful and adequate provisions shall be made whereby the holder shall thereafter have the right to purchase and receive upon the basis and the terms and conditions specified in this Agreement and in lieu of the Common Stock immediately theretofore purchasable and receivable upon the exercise of the rights represented hereby, such shares of stock, securities or assets as may be issued or payable in such transaction with respect to or in exchange for the number of Common Stock purchasable and receivable upon the exercise of the rights represented hereby had such rights been exercised immediately prior thereto, and in any such case appropriate provision shall be made with respect to the rights and interests of Warrant Holder to the end that the provisions hereof (including, without limitation, provisions for adjustments of the Exercise Price and of the number of Common Stock purchasable and receivable upon the exercise of the Warrant) shall thereafter be applicable, as nearly as may be, in relation to any shares of stock, securities or assets thereafter deliverable upon the exercise hereof. For a period of twelve (12) months following the Closing Date, Company will not effect any such transaction, unless prior to the consummation thereof the successor entity (if other than Company) resulting from the Disposition Transaction or the entity purchasing, leasing or otherwise acquiring such assets shall assume by written instrument addressed to Warrant Holder, executed and mailed or delivered to Warrant Holder at the last address thereof appearing on the books of Company, the obligation to deliver to such Warrant Holder such shares of stock, securities or assets as, in accordance with the foregoing provisions, such Warrant Holder may be entitled to purchase. “Disposition Transaction” means the disposition (whether structured as a sale, lease or otherwise) by Company or any of its affiliates, directly or indirectly, in one transaction or a series of transactions of any or all of the shares of (or other equity or voting interests in) Company or any or all of the assets or businesses of Company, whether by way of merger, consolidation, tender offer, exchange offer, liquidation, dissolution, joint venture, purchase, recapitalization or similar transaction.

(m) Adjustment in Number of Shares. Upon each adjustment of the Exercise Price pursuant to this Section 10 (other than Section 10(f)), the Warrant shall thereafter evidence the right to receive upon payment of the adjusted Exercise Price that number of shares of Common Stock (rounded upwards to the next whole share) obtained from the following formula:

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N’= N x  E 

                E’

where:

N’  = the adjusted number of Warrant Securities issuable upon exercise of the Warrant by payment of the adjusted Exercise Price.

N  = the number of Warrant Securities previously issuable upon exercise of the Warrant by payment of the Exercise Price prior to adjustment.

E’  = the adjusted Exercise Price.

E  = the Exercise Price prior to adjustment.

(n) Form of Warrant. Irrespective of any adjustments in the Exercise Price or the number or kind of shares purchasable upon the exercise of the Warrant, any Warrant theretofore or thereafter issued may continue to express the same price and number and kind of shares as are stated in the Warrant initially issuable pursuant to this Agreement.

SECTION 11. Capitalization; Adjustment to the Number of Warrant Securities. Company hereby represents, warrants and covenants to Warrant Holder as follows:

(a) The authorized capital stock of Company consists of 100,000,000 shares of Common Stock and 500,000 shares of Preferred Stock. As of the date of this Agreement (i) 16,436,886 shares of Common Stock are validly issued and outstanding, fully paid and nonassessable, (ii) no shares of Preferred Stock are issued and outstanding and (iii) 2,525,685 shares of Common Stock are issuable upon exercise, conversion or exchange of outstanding options, warrants (including the Warrant), rights or other securities (the “Derivative Securities”). Except as contemplated by clauses (i) through (iii) above, there are no other shares of capital stock or other equity securities of Company outstanding, and no other outstanding options, warrants, rights to subscribe to (including any preemptive rights), calls or commitments of any character whatsoever to which Company or any of its subsidiaries or affiliates is a party or may be bound, requiring the issuance or sale of shares or other equity securities of Company or securities or rights convertible into or exchangeable or exercisable for such shares or other equity securities, and there are no contracts, commitments, understandings or arrangements by which Company is or may become bound to issue additional shares of its capital stock or other equity securities or options, warrants or rights to purchase or acquire any additional shares of its capital stock or other equity securities or securities convertible into or exchangeable or exercisable for such shares or other equity securities.

(b) All of the shares of Common Stock issuable upon exercise, conversion or exchange of the Derivative Securities as of the Closing Date (after giving effect to the transactions contemplated under the Purchase Agreement and whether or not in the money) shall be included in calculating the number of Warrant Securities issuable upon the exercise of the Warrant. The parties agree that, in the event that prior to the issuance of all of the Warrant Securities issuable upon exercise of the Warrant, the number of shares of Common Stock

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issuable upon exercise, conversion or exchange of the Derivative Securities decreases due to the expiration, cancellation or other termination of any Derivative Securities, then the number of shares to be acquired upon exercise of the Warrant shall be equitably adjusted downward.

SECTION 12. Financial Statements; Other Documents. The Company shall provide promptly to Warrant Holder at no cost to Warrant Holder a copy of all financial statements and budgets of the Company and its Subsidiaries, and all other documents which it is required to provide to the Collateral Agent and the Purchaser under the Purchase Agreement.

SECTION 13. Notices to Warrant Holders. On the Closing Date and upon any adjustment of the Exercise Price pursuant to Section 10, Company shall promptly thereafter (i) cause to be filed with Company a certificate of Ernst & Young LLP or another firm of independent public accountants of nationally recognized standing selected by the Board of Directors, if acceptable to the Warrant Holder, setting forth the Exercise Price as of the Closing Date or after such adjustment, as applicable, and setting forth in reasonable detail the method of calculation and the facts upon which such calculations are based and setting forth the number of Warrant Securities (or portion thereof) issuable, as applicable, on the Closing Date or after such adjustment in the Exercise Price, upon exercise of the Warrant and payment of the initial Exercise Price or the adjusted Exercise Price, as applicable, which certificate shall be presumptive evidence of the correctness of the matters set forth therein, and (ii) cause to be given to the registered holder of the Warrant Certificate written notice of the initial Exercise Price or such adjustments, as applicable. Where appropriate, such notice may be given in advance and included as a part of the notice required to be mailed under the other provisions of this Section 13.

In case on or after the date of this Agreement:

(a) Company shall authorize the issuance to any holders of shares of Common Stock of rights, options or warrants to subscribe for or purchase shares of Common Stock or of any other subscription rights or warrants;

(b) Company shall authorize the distribution to any holders of shares of Common Stock of evidences of its indebtedness or assets (including without limitation ordinary quarterly cash dividends);

(c) of any consolidation or merger to which Company is a party and for which approval of any stockholders of Company is required, or of any reclassification or change of Common Stock issuable upon exercise of the Warrant, or a tender offer or exchange offer made by Company for shares of Common Stock;

(d) of the voluntary or involuntary dissolution, liquidation or winding up of Company;

(e) Company proposes to take any action (other than actions of the character described in Section 10(a)) which would require an adjustment of the Exercise Price pursuant to Section 10;

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(f) Company proposes to issue, sell, grant or distribute any Equity Security; or

(g) of any proposed transaction that would constitute a Disposition Transaction or a Conversion (whether or not a transaction of the type described in Section 10(k));

then Company shall cause to be given to the registered holder of the Warrant Certificate, at least twenty (20) days (or ten (10) days in any case specified in clauses (a) or (b) above) prior to the applicable record date hereinafter specified, or promptly (and, in any event, within ten (10) days) in the case of events for which there is no record date, a written notice stating (i) the date as of which the holders of record of shares of Common Stock to be entitled to receive any such rights, options, warrants or distributions are to be determined, (ii) the initial expiration date set forth in any tender offer or exchange offer made by Company for shares of Common Stock, (iii) the date on which any such Disposition Transaction, Conversion or other transaction is expected to become effective or consummated, and the date as of which it is expected that holders of record of shares of Common Stock shall be entitled to exchange such shares for securities or other property, if any, deliverable in connection with such Disposition Transaction or other transaction, or (iv) the date on which any such issuance, sale, grant or distribution or other transaction is expected to become effective or consummated.

Company shall provide to Warrant Holder, within five (5) days following request by Warrant Holder, such other information or documents as Warrant Holder may reasonably request regarding any event described in clauses (a) through (g) above as to which Company shall have given Warrant Holder notice pursuant to the immediately preceding paragraph.

Nothing contained in this Agreement or in the Warrant Certificate shall be construed as conferring upon Warrant Holder the right to vote or to consent or to receive notice as a stockholder in respect of the meetings of stockholders or the election of Directors of Company or any other matter, or any rights whatsoever as stockholders of Company.

SECTION 14. Survival of Rights. This Agreement and Article 8 and Article 9 of the Purchase Agreement shall remain in effect by and between the Company and Warrant Holder and their respective successors and assigns hereunder so long as the Warrant remains unexercised in whole or in part. Article 9 of the Purchase Agreement is hereby incorporated herein by this reference and, notwithstanding anything to the contrary in the Purchase Agreement, shall run in favor of, and for the benefit of, and may be enforced by Warrant Holder and its respective successors and assigns.

SECTION 15. Notices to Company and Warrant Holder. Any notice or demand authorized by this Agreement to be given or made by Warrant Holder to or on Company shall be sufficiently given or made when and if delivered by a recognized overnight delivery service, or deposited in the mail, first class or registered, postage prepaid, addressed to the office of Company expressly designated by Company for purposes of this Agreement (until Warrant Holder is otherwise notified in accordance with this Section by Company), as follows:

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IMPCO Technologies, Inc.

16804 Gridley Place

Cerritos, California 90703

Telecopier No.: (562) 924-8063

Attention: Mr. Robert M. Stemmler

with a copy to:

Davis Wright Tremaine LLP

2600 Century Square

1501 Fourth Avenue

Seattle, WA 98101

Telecopier No.: (206) 628-7699

Attention: Marcus J. Williams, Esq.

Any notice pursuant to this Agreement to be given by Company to the registered holder of the Warrant Certificate shall be sufficiently given when and if delivered by a recognized overnight delivery service, or deposited in the mail, first-class or registered, postage prepaid, addressed (until Company is otherwise notified in accordance with this Section by such Warrant Holder) to such Warrant Holder at the following address:

Bison Capital Structured Equity Partners, LLC

100 Wilshire Boulevard, Suite 450

Santa Monica, California 90401

Telecopier: (310) 260-6576

Attention: Mr. Douglas B. Trussler

with a copy to:

Latham & Watkins LLP

633 West Fifth Street, Suite 4000

Los Angeles, California 90071

Telecopier: (213) 891-8763

Attention: Dominic Yoong, Esq.

SECTION 16. Consents and Best Efforts. Company shall as soon as practicable after the date hereof, commence to take all action required to obtain all consents, approvals and agreements of, and to give all notices and make all other filings with, any individual, firm, corporation, partnership, trust, unincorporated organization or other entity or a government or agency or political subdivision thereof necessary to authorize, approve or permit the consummation of the transactions contemplated by this Agreement, and Warrant Holder shall cooperate with Company with respect thereto. In addition, subject to the terms and conditions provided herein, Company covenants and agrees to use its best efforts to take, or cause to be taken, all action or do, or cause to be done, all things necessary, proper or advisable under applicable laws and regulations to consummate and make effective the transactions contemplated hereby and to cause the fulfillment of Company’s obligations hereunder.

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SECTION 17. Successors. All the covenants and provisions of this Agreement shall bind and inure to the benefit of the parties’ respective successors and assigns hereunder.

SECTION 18. Governing Law. THIS AGREEMENT AND THE WARRANT CERTIFICATE ISSUED HEREUNDER SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK AND FOR ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF SAID STATE.

SECTION 19. Benefits of This Agreement. This Agreement shall be for the sole and exclusive benefit of Company and Warrant Holder and their permitted successors and assigns. There are no intended third party beneficiaries of this Agreement.

SECTION 20. Interpretation. This Agreement shall be interpreted in accordance with its fair meaning and shall not be interpreted in favor of one party or the other.

SECTION 21. Counterparts. This Agreement may be executed in any number of counterparts (including by facsimile) and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.

(Signature Page Follows)

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IN WITNESS WHEREOF, Company and Warrant Holder have caused this Common Stock Warrant Agreement to be executed and delivered by their respective officers or authorized signatories thereunto duly authorized, all as of the day and year first above written.

IMPCO TECHNOLOGIES, INC., a Delaware

corporation

By:

Name:

Title:

BISON CAPITAL STRUCTURED EQUITY

PARTNERS, LLC, a Delaware limited liability

company

By:

Name:

Title:

S-1

ANNEX 1

TO WARRANT AGREEMENT

Form of Warrant Certificate

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR AN APPLICABLE EXEMPTION TO THE REGISTRATION REQUIREMENT OF SUCH ACT OR SUCH LAWS.

No. 1 500,000 Shares

Warrant Certificate

IMPCO TECHNOLOGIES INC.

This Warrant Certificate (the “Warrant”) certifies that BISON CAPITAL STRUCTURE EQUITY PARTNERS, LLC, a Delaware limited liability company (“Bison Capital”), or its registered assigns, is the registered holder of one Warrant expiring at 5:00 p.m., Los Angeles time, on the fifth anniversary of the Closing Date (as defined in the Purchase Agreement, defined below) (the “Warrant Termination Date”), to purchase common stock, $0.001 par value, (the “Common Stock”), of IMPCO Technologies, Inc., a Delaware corporation (“Company”). Subject to the terms and conditions hereinafter set forth and set forth in the Warrant Agreement (defined below), the holder upon exercise of the Warrant is entitled to receive from Company prior to the Warrant Termination Date, 500,000 shares of fully paid and nonassessable shares of Common Stock upon exercise of Derivative Securities (as defined in the Warrant Agreement) outstanding on the Closing Date at the initial per-share exercise price of $2.00 per share (the “Exercise Price”).

The Exercise Price shall be payable in lawful money of the United States of America upon surrender of this Warrant Certificate and payment of the Exercise Price at the office of Company designated for such purpose, but only subject to the conditions set forth herein and in the Warrant Agreement referred to below. Notwithstanding the foregoing, the Warrant may be exercised without the exchange of funds pursuant to the net exercise provisions of Section 6(a) of the Warrant Agreement. The Exercise Price and number of Warrant Securities issuable upon exercise of the Warrant shall be initially determined as of the Closing Date as set forth herein and are subject to adjustment thereafter upon the occurrence of certain events set forth in the Warrant Agreement.

Reference is made to that certain Securities Purchase Agreement, dated as of July [    ], 2003, by and between Company and Bison Capital (as amended, restated or otherwise

i

modified from time to time, the “Purchase Agreement”). Capitalized terms used herein but not otherwise defined shall have the meanings assigned to such terms in the Purchase Agreement.

The Warrant may not be exercised after 5:00 p.m., Los Angeles time, on the Warrant Termination Date and to the extent not exercised by such time such Warrant shall become void.

The Warrant is issued pursuant to a Common Stock Warrant Agreement dated as of July [    ], 2003 (the “Warrant Agreement”) and the Purchase Agreement, duly executed and delivered by Company, which Warrant Agreement and Purchase Agreement are hereby incorporated by reference in and made a part of this instrument and are hereby referred to for a description of the rights, limitation of rights, obligations, duties and immunities thereunder of Company and the holder (the word “holder” meaning the registered holder) of the Warrant. A copy of the Warrant Agreement or the Purchase Agreement may be obtained by the holder hereof upon written request to Company.

The Warrant may be exercised at any time commencing on Closing Date and until 5:00 p.m., Los Angeles time, on the Warrant Termination Date. The holder of the Warrant evidenced by this Warrant Certificate may exercise it by surrendering this Warrant Certificate, with the form of election to purchase set forth hereon properly completed and executed, together with payment of the Exercise Price in accordance with the Warrant Agreement at the office of Company designated for such purpose. In the event that upon any exercise of the Warrant evidenced hereby the number of Warrant Securities issuable upon such exercise shall be less than the total number of Warrant Securities evidenced hereby, there shall be issued to the holder hereof or its assignee a new Warrant Certificate evidencing the number of Warrant Securities not exercised.

Each of the Warrant, the Warrant Agreement and the Purchase Agreement provides that upon the occurrence of certain events the Exercise Price set forth on the face hereof may, subject to certain conditions, be adjusted. If the Exercise Price is adjusted, each of the Warrant and the Warrant Agreement provides that the number of shares of Common Stock issuable upon the exercise of the Warrant shall be adjusted.

The holder of the Warrant is entitled, in certain circumstances, to certain registration rights with respect to the Warrant Securities issuable upon the exercise of the Warrant. Such registration rights are set forth in a Registration Rights Agreement of even date herewith between the Company and Bison Capital (the “Registration Rights Agreement”). By acceptance of this Warrant Certificate, the holder hereof agrees that upon exercise, in whole or in part, of the Warrant evidenced by this Warrant Certificate, such holder will be bound by the Registration Rights Agreement as a holder of Registrable Securities thereunder. A copy of the Registration Rights Agreement may be obtained by the holder of this Warrant Certificate upon written request to the Company, and upon request by the Company (whether or not made as a condition to effecting transfer to such person) such holder shall execute and deliver a form of joinder thereto as is reasonably satisfactory to the Company.

The Warrant Certificate, when surrendered at the office of Company by the registered holder thereof in person or by legal representative or attorney duly authorized in

ii

writing, may be exchanged, in the manner and subject to the limitations provided in the Warrant Agreement, but without payment of any service charge, for another Warrant Certificate or Warrant Certificates of like tenor evidencing in the aggregate a like number of Warrant Securities.

Upon due presentation for registration of transfer of this Warrant Certificate at the office of Company a new Warrant Certificate or Warrant Certificates of like tenor and evidencing in the aggregate a like number of Warrant Securities shall be issued to the transferee(s) in exchange for this Warrant Certificate, subject to the limitations provided in the Warrant Agreement, without charge except for any tax or other governmental charge imposed in connection therewith.

Neither the Warrant nor this Warrant Certificate entitles any holder hereof to any rights of a stockholder of Company.

(Signature Page Follows)

iii

IN WITNESS WHEREOF, Company has caused this Warrant Certificate to be signed by its duly authorized officers.

Dated: [            ], 2003

IMPCO TECHNOLOGIES, INC., a Delaware

corporation

By:

Name:

Title:

Form of Election to Purchase

(To Be Executed Upon Exercise Of The Warrant)

The undersigned hereby irrevocably (subject to Section 6(e)) of the Warrant Agreement) elects to exercise the right, represented by this Warrant Certificate, to receive              shares of Common Stock, $0.001 par value per share, of IMPCO TECHNOLOGIES, INC., a Delaware corporation, and herewith tenders payment for such shares in the amount of $             in accordance with the terms hereof, unless the holder is exercising the Warrant pursuant to the net exercise provisions of Section 6(a) of the Warrant Agreement. The undersigned requests that a certificate for such shares be registered in the name of                                          , whose address is                                                          , and that such shares be delivered to                                         , whose address is                                                          . If said number of shares is less than all of the Common Stock purchasable hereunder, the undersigned requests that a new Warrant Certificate representing the remaining balance of such shares be registered in the name of                                         , whose address is                                                          , and that such Warrant Certificate be delivered to                                         , whose address is                                                          .

Signature:                                    

Date:                             

EX-10.75

EXHIBIT 10.75

SENIOR SECURED SUBORDINATED PROMISSORY NOTE

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD, TRANSFERRED, OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL TO THE TRANSFEROR, REASONABLY SATISFACTORY TO THE MAKER AS TO FORM, SUBSTANCE AND OPINING COUNSEL TO THE EFFECT THAT SUCH TRANSFER IS PURSUANT TO AND IN COMPLIANCE WITH AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT AND SUCH LAWS.

THIS NOTE AND THE INDEBTEDNESS EVIDENCED HEREBY IS SUBORDINATED, IN THE MANNER AND TO THE EXTENT SET FORTH IN THE SUBORDINATION AND INTERCREDITOR AGREEMENT DATED AS OF JULY 18, 2003 (AS SUCH AGREEMENT MAY FROM TIME TO TIME BE AMENDED, MODIFIED OR SUPPLEMENTED IN ACCORDANCE WITH ITS TERMS, THE “INTERCREDITOR AGREEMENT”), BY THE MAKER AND PAYEE OF THIS NOTE IN FAVOR OF LASALLE BUSINESS CREDIT, LLC, AS AGENT (THE “SENIOR AGENT”) FOR CERTAIN LENDING INSTITUTIONS (THE “SENIOR LENDERS”), TO ALL INDEBTEDNESS, LIABILITIES AND OBLIGATIONS (INCLUDING INTEREST) AT ANY TIME OWED BY THE MAKER OF THIS NOTE TO THE SENIOR AGENT AND THE SENIOR LENDERS UNDER THE LOAN AND SECURITY AGREEMENT DATED AS OF JULY [    ], 2003, AND ALL AGREEMENTS, DOCUMENTS AND INSTRUMENTS RELATING THERETO, AND EACH HOLDER OF THIS NOTE, BY ITS ACCEPTANCE HEREOF, SHALL BE BOUND BY THE INTERCREDITOR AGREEMENT.

THIS NOTE WAS ISSUED WITH ORIGINAL ISSUE DISCOUNT UNDER SECTIONS 1272, 1273 AND 1275 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED. YOU MAY CONTACT THE CHIEF FINANCIAL OFFICER OF IMPCO TECHNOLOGIES, INC. AT 16804 GRIDLEY PLACE, CERRITOS, CALIFORNIA, 90703, TELECOPY NUMBER: (562) 274-0346, WHO WILL PROVIDE YOU WITH ANY REQUIRED INFORMATION REGARDING THE ORIGINAL ISSUE DISCOUNT.

11.25% SENIOR SECURED SUBORDINATED PROMISSORY NOTE

Due July     , 2007

$20,000,000 New York, New York

July     , 2003

FOR VALUE RECEIVED, the undersigned, IMPCO TECHNOLOGIES, INC., a Delaware corporation (the “Maker”), hereby promises to pay to the order of BISON CAPITAL STRUCTURED EQUITY PARTNERS, LLC (“Bison Capital”), a Delaware limited liability company, or its registered assigns (the “Holder”), the principal sum of Twenty Million Dollars ($20,000,000) plus all interest capitalized pursuant to Section 1(a) of this Note, if any, on July     , 2007 (the “Maturity Date”), together with interest thereon from time to time as provided

herein and in the Securities Purchase Agreement (the “Purchase Agreement”), dated as of July     , 2003, by and between the Maker and Bison Capital. The principal amount hereof, and the interest thereon, shall be payable in lawful currency of the United States of America.

This Note is the Note referred to in the Purchase Agreement, is subject to the provisions of the Purchase Agreement and is subject to optional and mandatory redemption in whole or in part as provided in the Purchase Agreement. The Holder is entitled to the benefits of this Note and the Purchase Agreement, as it relates to the Note, and may enforce the agreements of the Maker contained herein and therein and exercise the remedies provided for hereby and thereby or otherwise available in respect hereto and thereto. Capitalized terms used herein without definition are used herein with the meanings ascribed to such terms in the Purchase Agreement. This Note is subordinated, secured and guaranteed as provided in the Transaction Documents.

1. Interest.

(a) The Maker promises to pay interest on the principal amount of this Note (including any amounts previously capitalized and added to principal pursuant to this paragraph (a)) at the rate of 11.25% per annum. The Maker shall pay accrued interest monthly in arrears on the last date of each calendar month or, if any such date shall not be a Business Day, on the next succeeding Business Day to occur after such date, beginning on July     , 2003; provided, however, that during the continuance of a Default or an Event of Default and subject to the Intercreditor Agreement, such interest shall be due and payable on demand and bear interest at the applicable default rate of interest specified in the Purchase Agreement; provided, further, that, at the Maker’s option, any such default interest may be capitalized and added to the principal hereunder; and provided, further, that any interest under this Note or provided in the Purchase Agreement (including, without limitation, Section 2.6 and Section 10.2(r) thereof) shall be capitalized and added to the principal hereunder to the extent such interest is not payable pursuant to the Intercreditor Agreement. Interest payable on this Note pursuant to this paragraph (a) (and not otherwise capitalized in accordance with the immediately preceding proviso) shall be paid by wire transfer of immediately available funds to an account at a bank designated in writing by the Holder.

(b) Interest payable on this Note under paragraph (a) above shall accrue from and including the date of issuance through and until repayment of the principal and payment of all accrued interest and premium, if any, in full. All interest payable under this Note shall accrue and be computed on the basis of a 360-day year of twelve 30-day months.

2. Transfer.

(a) The term “Holder” as used herein shall also include any transferee of this Note whose name has been recorded by the Company in the Register. Each transferee of this Note acknowledges that this Note has not been registered under the Securities Act, and may be transferred only pursuant to an effective registration under the Securities Act or pursuant to an applicable exemption from the registration requirements of the Securities Act.

(b) The Company shall maintain at its principal executive office the Register for the registration and registration of transfers of Note. The name and address of the

2

Holder, each transfer thereof and the name and address of each transferee shall be registered in the Register. Prior to due presentment for registration of transfer, absent manifest error, the Person in whose name the Note shall be registered shall be deemed and treated as the owner and holder thereof for all purposes hereof. Any transfer of the Note shall be effective only upon appropriate entries with respect thereto being made in the Register. The Company shall give to any holder of the Note that is Purchaser or an institutional investor, promptly upon request therefor, a complete and correct copy of the names and addresses of all registered holders of the Note.

(c) This Note may be transferred or assigned, in whole or in part, by the Holder at any time. Such transfer shall be effective upon receipt by the Maker of the original Note together with such transfer documents as the Maker shall reasonably request, and including at a minimum an endorsement for transfer or cancellation, the name, address and facsimile number of the transferee and, in the case of a transfer of less than all of this Note, an indication of the amount to be transferred. In the case of each such transfer, the Holder intending to effect the same shall provide the Maker, at the time of notification of transfer, an opinion of counsel reasonably satisfactory to the Maker as to form, content and opinion giver, to the effect that such transfer is pursuant to and in full compliance with the requirements of all applicable federal and state securities laws, and shall certify to the Maker that the Holder has paid or will promptly pay the Transfer Taxes attendant to such transfer.

3. Replacement of Note. On receipt by the Company of an affidavit of an authorized representative of the Holder stating the circumstances of the loss, theft, destruction or mutilation of the Note (and in the case of any such mutilation, on surrender and cancellation of the Note), the Company, at its expense, will promptly execute and deliver, in lieu thereof, a new Note of like tenor.

4. GOVERNING LAW. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

5. Severability. If any one or more of the provisions contained herein, or the application thereof in any circumstance, is held invalid, illegal or unenforceable in any respect for any reason, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions hereof shall not be in any way impaired, unless the provisions held invalid, illegal or unenforceable shall substantially impair the benefits of the remaining provisions hereof.

6. Headings. The headings in this Note are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

7. Waiver. The Maker hereby waives presentment, demand, protest or notice of any kind in connection with this Note. All payments under this Note shall be made without setoff, counterclaim or deduction of any kind.

(Signature Page Follows)

3

IMPCO TECHNOLOGIES INC., a Delaware corporation
By:
Name:	Robert M. Stemmler
Title:	President and Chief Executive Officer

SIGNATURE PAGE TO NOTE

EX-99.1

Exhibit 99.1

IMPCO Announces $32 Million Debt Financings

Cerritos, CA, July 21, 2003, PR Newswire – IMPCO Technologies, Inc. (NASDAQ: IMCO) announced today it has closed financing arrangements with LaSalle Business Credit, LLC and Bison Capital Structured Equity Partners, LLC. IMPCO’s financing from LaSalle is a $12 million revolving line of credit with a maturity date of July 18, 2006. IMPCO also issued a $20 million senior subordinated secured note to Bison Capital that is payable in full on July 18, 2007.

The combined financing will permit IMPCO to repay approximately $11.3 million currently outstanding under its Bank of America credit facilities, which matured on July 15, 2003. The funds will also permit IMPCO to complete its acquisition of 50% of the equity interests of B.R.C. Societa a Responsabilità Limitata, a limited liability company formed under the laws of the Italian Republic.

IMPCO’s Chief Financial Officer Tim Stone stated, “The combined LaSalle and Bison financing package replaces our former Bank of America credit facilities and provides IMPCO with working capital, funds the deferred payment portion of the company’s recent acquisition of a 50% equity interest in BRC, helps meet the future operating needs of the company and will assist in supporting the future growth of IMPCO.”

Note Regarding Forward Looking Statements

Certain matters discussed in this press release contain forward-looking information that involves risks and uncertainties. These risks could cause actual results to differ materially from management’s current expectations. Certain issues relating to these risks are discussed in the section of the company’s eight-month transition report on Form 10-K for the period ended December 31, 2002 entitled Risk Factors. These and other risks that relate to our business more generally also are discussed in that report and in our other reports filed with the Securities and Exchange Commission (the “SEC”). These reports are available without charge from the SEC’s electronic data-lease at http://www.sec.gov, or on the company’s website. The contents of our website are not incorporated into this release or into our SEC reports.

Regarding IMPCO:

IMPCO designs, manufactures, markets and supplies advanced alternative fuel systems and related products. Headquartered in Cerritos, California, IMPCO has offices in Asia, Europe, Australia and South and North America. More information can be found at www.impco.ws. IMPCO also sells products under the BRC brand names through its 50% stake in that entity.

For further information contact Mr. Dale Rasmussen, Investor Relations

Phone:	+1-206-315-8242.
Fax:	+1-206-315-8301.

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