WAIVER AND FIRST AMENDMENT TO FINANCING AGREEMENT

Exhibit 10.15

THIS WAIVER AND FIRST AMENDMENT TO FINANCING AGREEMENT (this “Amendment”) is entered into as of March 16, 2007, by and among BODY SHOP OF AMERICA, INC., a Florida corporation (“Body Shop”), CATALOGUE VENTURES, INC., a Florida corporation (“CV,” CV, together with Body Shop and each other Person who becomes a borrower under the Financing Agreement, the “Borrowers”), BODY CENTRAL ACQUISITION CORP., a Delaware corporation (“Parent”), RINZI AIR, L.L.C., a Florida limited liability company (“Xxxx,” Rinzi, together with Parent and each other Person who becomes a guarantor under the Financing Agreement, the “Guarantors,” such Guarantors, together with the Borrowers, the “Loan Parties”), DYMAS FUNDING COMPANY, LLC, as administrative agent (in such capacity, “Administrative Agent”) for the Lenders, and the financial institutions from time to time party thereto as Lenders.

W I T N E S S E T H:

WHEREAS, Borrowers, Guarantors, Administrative Agent, Lenders and certain other parties thereto have entered into that certain Financing Agreement dated as of October 1, 2006 (as the same may be further amended, restated, supplemented or otherwise modified from time to time, the “Financing Agreement”);

WHEREAS, Borrowers have informed Administrative Agent that certain Events of Default have arisen and are continuing (collectively, the “Designated Defaults”) as a result of the failure of the Loan Parties to comply (i) with the provisions of Section 7.03(b) (Fixed Charge Coverage Ratio) of the Financing Agreement by reason of the Parent and its Subsidiaries having a Fixed Charge Coverage Ratio, as determined as at December 31, 2006 for the four consecutive fiscal quarters ending on or about such date, of 0.97 (as opposed to having a Fixed Charge Coverage Ratio, as determined as of such date for such four fiscal quarters ending on or about such date, of not less than 1.05), and (ii) with the provisions of Section 7.03(c)(ii) (Capital Expenditures) of the Financing. Agreement by reason of the Parent and its Subsidiaries making. Capital Expenditures (other than a Point of Sale Capital Expenditures (by purchase or Capitalized Lease)) of $3,516,000 for the six month period ended December 30, 2006 (as opposed to not making such Capital Expenditures in excess of $2,500,000 for such period);

WHEREAS, the parties to the Financing Agreement desire to waive the Designated Defaults; and

WHEREAS, the parties to the Financing Agreement desire to amend the Financing Agreement on the terms and subject to the conditions set forth herein.

NOW, THEREFORE, in consideration of the mutual agreements, provisions and covenants contained herein, the parties agree as follows:

1. Defined Terms. Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Financing Agreement.

2. Amendments. Effective as of the Effective Date, the Financing Agreement is amended as follows:

a. Section 7.01(a) of the Financing Agreement (Reporting Requirements) shall be amended by inserting the following clause (xiv) immediately prior to Section 7.01(b):

(xiv) for each fiscal month during the fiscal year ending on or about December 31, 2007, as soon as possible, and in any event within ten (10) Business Days after the end of each such fiscal month, a detailed summary of Borrowers’ same store sales, preliminary aggregate gross profit margins as presented by the merchandising system, estimated month-end cash balance and estimated gross month-end inventory values, such summary to be in form reasonably satisfactory to Administrative Agent in its sole discretion.

b. Section 7.02(0 of the Financing Agreement (Restricted Payments) shall be amended by inserting the following clause (ix) immediately prior to Section 7.02(g):

(ix) Parent may repurchase or redeem, and Borrowers may dividend funds to Parent to enable Parent to repurchase or redeem, up to 30,000 shares of the Series C preferred stock of Parent from Xxxxxx Xxxxxxxxx Family Trust, Marital Trust 1 for Xxxxxxx Xxxxxxxxx, Marital Trust 2 for Xxxxxxx Xxxxxxxxx, Xxxxxxx Xxxxxxxxx, Xxxx X. Xxxxxx, Xxxxxx X. Xxxxxxx and Xxxxxx Xxxx (collectively, the “Series C Holders” and each, individually, a “Series C Holder”) for cash consideration of no more than $3,000,000 plus accrued dividends on such Series C preferred stock through the date of such repurchase or redemption, provided all of the following conditions are satisfied:

(A) dividends on each issued and outstanding share of Series C preferred stock shall not accrue at a rate in excess of 5%;

(B) no Default or Event of Default has occurred and is continuing or would arise as a result of such Restricted Payment;

(C) after giving effect to such Restricted Payment, Borrowers’ are in compliance with the covenants set forth in Section 7.03 of the Financing Agreement, as calculated based on information provided in audited financial statements;

(D) Administrative Agent shall have received evidence satisfactory to it that Consolidated EBITDA of Parent and its Subsidiaries (i) is equal to or greater than $18,500,000 for the Fiscal Year ending on or about December 31, 2007, as calculated based on information provided in audited financial statements for such fiscal year, or (ii) if Consolidated EBITDA of Parent and its Subsidiaries is not equal to or greater than $18,500,000 for the Fiscal Year ending on or about December 31, 2007, as calculated based on information provided in audited financial statements for such fiscal year, then Consolidated EBITDA of Parent and its Subsidiaries is equal to or greater than $18,500,000 for

any two consecutive fiscal quarters occurring after December 31, 2007, as calculated based on information provided in the most recent financial statements provided to Administrative Agent pursuant to Section 7.01 of this Agreement;

(E) the aggregate amount of all such Restricted Payments permitted during the term of the Financing Agreement shall not exceed the sum of $3,000,000 plus all accrued dividends on the Series C preferred stock through the date of such Restricted Payment; and

(F) proceeds of Revolving Loans may not be used to make such Restricted Payment.

c. Section 7.03(a) of the Financing Agreement (Senior Leverage Ratio) shall be amended by deleting the covenant tables contained therein and substituting the following in lieu thereof:

Fiscal Quarter End		Senior Leverage Ratio
December 31, 2006		3.15
March 31, 2007*		3.85
June 30, 2007*		3.75
September 30, 2007*		3.55
December 31, 2007*		2.95
March 31, 2008		2.50
June 30, 2008		2.40
September 30, 2008		2.30
December 31, 2008		2.10
March 31, 2009		2.00
June 30, 2009		1.90
September 30, 2009		1.80
December 31, 2009 and each fiscal quarter thereafter		1.75

Notwithstanding anything to the contrary herein or in the Compliance Certificate, unrestricted cash on hand shall not be included in the calculation of Senior Leverage Ratio for testing periods in 2007.

d. Section 7.03(b) of the Financing Agreement (Fixed Charge Coverage Ratio) shall be amended by deleting the covenant tables contained therein and substituting the following in lieu thereof:

Fiscal Quarter End		Fixed Charge Coverage Ratio
December 31, 2006		1.05
March 31, 2007 **		1.00
June 30, 2007 **		1.00
September 30, 2007 **		1.05
December 31, 2007 **		1.05
March 31, 2008 and each fiscal quarter thereafter		1.10

** If any fiscal quarter set forth below is included in any period for which Fixed Charges are being calculated, the amount set forth below opposite such fiscal month shall be deemed to be Point of Sale Capital Expenditures for such fiscal quarter:

Fiscal Quarter Ended:	Amount:

March 31, 2007	$	250,000
June 30, 2007	$	250,000
September 30, 2007	$	1,250,000
December 31, 2007	$	1,250,000

e. Section 7.03(c)(ii) of the Financing Agreement (Capital Expenditures) shall be amended by deleting the covenant tables contained therein and substituting the following in lieu thereof:

Fiscal Year End	Maximum Capital Expenditures
December 31, 2007	$	3,300,000
December 31, 2008	$	5,650,000
December 31, 2009	$	5,200,000

Fiscal Year End	Maximum Capital Expenditures
December 31, 2010 and for each Fiscal Year thereafter	$	5,000,000

f. the Compliance Certificate attached as Exhibit A to the Financing Agreement is hereby deleted in its entirety and the Compliance Certificate attached hereto as Exhibit A substituted therefor.

3. Waiver and Consent. The Borrowers have notified the Administrative Agent and the Lenders that Designated Defaults currently exist under the Financing Agreement. Effective as of the Effective Date, the Lenders hereby waive the Designated Defaults. In addition, the Borrowers have notified the Administrative Agent that, notwithstanding anything to the contrary contained in Section 2.05(d) of the Financing Agreement, in connection with the Preferred Stock Issuance (as such term is defined in Section 5(c) hereof), the Borrowers desire to apply all of the proceeds thereof to the repayment of the Term Loan B (to be applied against the remaining principal amortization payments of such Term Loan B pro rata based on the respective amounts thereof) (such application being hereinafter referred to as the “Modified Prepayment Application”). The Borrowers have requested that the Administrative Agent and the Lenders consent to such Modified Prepayment Application. Effective as of the Effective Date, the Lenders hereby consent to the proceeds of the Preferred Stock Issuance being applied pursuant to the Modified Prepayment Application.

4. Covenants. In connection with the execution of this Amendment, Borrowers hereby covenant and agree, in addition to any fees or other amounts paid or payable to Administrative Agent or the Lenders under the terms of the Financing Agreement, including the fees and other amounts set forth in the Fee Letter, Borrowers agree to pay, or cause to be paid, to Administrative Agent, in each case, for the ratable benefit of the Lenders, on the Effective Date, a fully-earned, non-refundable amendment fee in an amount equal to One Hundred Fifty-Seven Thousand Five Hundred Dollars ($157,500).

5. Conditions. The effectiveness of this Amendment is subject to the following conditions precedent, with the date on which such conditions have been satisfied being March [161, 2007 (the “Effective Date”):

a. the execution and delivery of this Amendment by each Loan Party, Administrative Agent and the Required Lenders;

b. the receipt by Administrative Agent of the amendment fees pursuant to Section 4 hereof;

c. Parent shall have issued 30,000 shares of its Series C preferred stock to the Series C Holders in exchange for cash consideration of not less than $3,000,000 (the “Preferred Stock Issuance”), the proceeds of which shall be used to repay the Loans pursuant to the Modified Prepayment Application;

d. the receipt by Administrative Agent of certified copies of all Organization Documents of Parent to be amended with respect to the Preferred Stock Issuance and each other agreement entered into in connection therewith, each of which shall be in form and substance acceptable to Administrative Agent;

e. the truth and accuracy of the representations and warranties contained in Section 6 hereof; and

f. no Default or Event of Default other than the Designated Defaults shall have occurred or be continuing.

6. Representations and Warranties. Each Loan Party hereby represents and warrants to Administrative Agent and each Lender as follows:

a. after giving effect to this Amendment, the representations and warranties of the Loan Parties contained in the Loan Documents are true and correct in all material respects as of the date hereof (except to the extent that any such representation or warranty (A) expressly refers to an earlier date, in which case such representation or warranty remains true and correct as of such earlier date, (B) is not true and correct due to events or conditions, the occurrence or existence of which are not prohibited by the Financing Agreement or the other Loan Documents and which do not, in and of themselves, constitute a Default or Event of Default or (C) is not true and correct as a result of disclosures made in writing to, and approved by, the Administrative Agent and Lenders in connection with a Permitted Acquisition);

b. the execution, delivery and performance by such Loan Party of this Amendment are within its powers, have been duly authorized by all necessary action pursuant to its Organization Documents, require no further action by or in respect of, or filing with, any governmental body, agency or official and do not violate, conflict with or cause a breach or a default under any provision of applicable law or regulation or of the Organization Documents of any Loan Party or of any agreement, judgment, injunction, order, decree or other instrument binding upon it;

c. this Amendment constitutes the valid and binding obligation of the Loan Parties, enforceable against such Persons in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws; and

d. other than with respect to the Designated Defaults, no Default or Event of Default exists.

7. No Waiver. The waivers in Section 3 hereof shall not be deemed waivers of any other Default or Event of Default (other than the Designated Defaults) which has occurred or exists under the Financing Agreement or hereafter may occur under the Financing Agreement, as amended, or to establish a custom or course of dealing among any Borrower, any Guarantor, Administrative Agent, the Lenders or any of them. Except as specifically set forth herein, Administrative Agent and the Lenders hereby expressly reserve all of their rights and remedies under the Financing Agreement, as amended, the other Loan Documents and applicable law.

Except as contained herein, nothing contained herein shall be deemed to constitute a waiver of compliance with any other term or condition contained in the Financing Agreement or any of the other Loan Documents or constitute a course of conduct or dealing among the parties. Except as amended hereby, the Financing Agreement and other Loan Documents remain unmodified and in full force and effect. All references in the Loan Documents to the Financing Agreement shall be deemed to be references to the Financing Agreement as amended hereby.

8. Severability. In case any provision of or obligation under this Amendment shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions or obligations, or of such provision or obligation in any other jurisdiction, shall not in any way be affected or impaired thereby.

9. Headings. Headings and captions used in this Amendment (including the Exhibits, Schedules and Annexes hereto, if any) are included for convenience of reference only and shall not be given any substantive effect.

10. GOVERNING LAW; SUBMISSION TO JURISDICTION. THIS AMENDMENT SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED IN THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES. EACH LOAN PARTY HEREBY RATIFIES AND AFFIRMS THE CONSENT TO THE JURISDICTION CONTAINED IN SECTION 11.09 OF THE FINANCING AGREEMENT WITH RESPECT TO ALL ACTIONS ARISING OUT OF THIS AMENDMENT.

11. WAIVER OF JURY TRIAL. EACH LOAN PARTY, ADMINISTRATIVE AGENT AND EACH LENDER HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM CONCERNING ANY RIGHTS UNDER THIS AMENDMENT OR THE OTHER LOAN DOCUMENTS, OR UNDER ANY OTHER AMENDMENT, WAIVER, CONSENT, INSTRUMENT, DOCUMENT OR OTHER AGREEMENT DELIVERED OR WHICH IN THE FUTURE MAY BE DELIVERED IN CONNECTION THEREWITH, OR ARISING FROM ANY FINANCING RELATIONSHIP EXISTING IN CONNECTION WITH THIS AMENDMENT, AND AGREES THAT ANY SUCH ACTION, PROCEEDINGS OR COUNTERCLAIM SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY. EACH LOAN PARTY CERTIFIES THAT NO OFFICER, REPRESENTATIVE, AGENT OR ATTORNEY OF ADMINISTRATIVE AGENT OR ANY LENDER HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT ADMINISTRATIVE AGENT OR ANY LENDER WOULD NOT, IN THE EVENT OF ANY ACTION, PROCEEDING OR COUNTERCLAIM, SEEK TO ENFORCE THE FOREGOING WAIVERS. EACH LOAN PARTY HEREBY ACKNOWLEDGES THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE ADMINISTRATIVE AGENT AND THE LENDERS ENTERING INTO THIS AMENDMENT.

12. Counterparts; Integration. This Amendment may be executed and delivered via facsimile with the same force and effect as if an original were executed and may be signed in any

number of counterparts, each of which shall be an original, with the same effect as if the signatures hereto were upon the same instrument. This Amendment constitutes the entire agreement and understanding among the parties hereto with respect to the subject matter hereof and supersedes any and all prior agreements and understandings, oral or written, relating to the subject matter hereof.

13. Reaffirmation. Each of the Loan Parties as debtor, grantor, pledgor, guarantor, assignor, or in any other similar capacity in which such Loan Party grants liens or security interests in its property or otherwise acts as accommodation party or guarantor, as the case may be, hereby (i) ratifies and reaffirms all of its payment and performance obligations, contingent or otherwise, under each of the Loan Documents to which it is a party (after giving effect hereto) and (ii) to the extent such Loan Party granted liens on or security interests in any of its property pursuant to any such Loan Document as security for or otherwise guaranteed the Borrowers’ Obligations under or with respect to the Loan Documents, ratifies and reaffirms such guarantee and grants of security interests and liens and confirms and agrees that such security interests and liens hereafter secure all of the Obligations as amended hereby. Each of the Loan Parties hereby consents to this Amendment and acknowledges that each of the Loan Documents remains in full force and effect and is hereby ratified and reaffirmed. The execution of this Amendment shall not operate as a waiver of any right, power or remedy of the Administrative Agent or the Lenders, constitute a waiver of any provision of any of the Loan Documents or serve to effect a novation of the Obligations.

[Remainder of Page Intentionally Left Blank; Signature Page. Follows]

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized, as of the date first above written,

	BORROWERS:

	BODY SHOP .AMERICA, INC., a Florida corporation


	By:	/s/ Xxxxxx Xxxxxx
	Name:
	Title:

	CATALOGUE VENTURES, INC., a Florida corporation


	By:	/s/ Xxxxxx Xxxxxx
	Name:
	Title:

	GUARANTORS:

	BODY SHOP ACQUISITIONS CORP., a Delaware corporation


	By:	/s/ Xxxxxx Xxxxxx
	Name:
	Title:

	RINZI AIR., L.L.C., a Florida limited liability company

	By:	Body Shop of America, Inc., its sole Member


	By:	/s/ Xxxxxx Xxxxxx
	Name:
	Title:

	ADMINISTRATIVE AGENT:

	DYMAS FUNDING COMPANY, LLC, as Administrative Agent

	By:	Dymas Capital Management Company, LLC, its Manager


	By:	/s/ Xxxxxxx X. Xxxxxxx
	Name:	Xxxxxxx X. Xxxxxxx
	Title:	Managing Director

	LENDERS:

	XXXXXXXXX FINANCIAL CAYMAN LTD., as a Lender


	By:	/s/ Xxxxxxxxxxx Xxx
	Name:	Xxxxxxxxxxx Xxx
	Title:	Managing Director

	NEWSTAR SHORT-TERM FUNDING LLC, as a Lender

	By	NewStar Financial, Inc., its Designated
		Manager


	By:	/s/ P. Xxxxx Xxxxxxxxx
	Name:	P. Xxxxx Xxxxxxxxx
	Title:	NewStar Financial
		Managing Director
		Portfolio Management

	NEWSTAR LLC 2005-1, as a Lender

	By:	NewStar Financial, Inc., its Sole Member


	By:	/s/ P. Xxxxx Xxxxxxxxx
	Name:	P. Xxxxx Xxxxxxxxx
	Title:	NewStar Financial
		Managing Director
		Portfolio Management

	A3 FUNDING LP, as a Lender

	By:	A3 Fund Management LLC, its General Partner


	By:	/s/ Xxxxxxxxx X. Xxxxxxxx
	Name:	Xxxxxxxxx X. Xxxxxxxx
	Title:	Vice President

	ABLECO FINANCE LLC, as a Lender


	By:	/s/ Xxxxxxxxx X. Xxxxxxxx
	Name:	Xxxxxxxxx X. Xxxxxxxx
	Title:	Vice President

	NATIONAL CITY BANK, as a Lender


	By:	/s/ Xxxxxxxx X. Xxxxx
	Name:	Xxxxxxxx X. Xxxxx
	Title:	Relationship Manager

	CAPITALSOURCE FINANCE LLC, as a Lender


	By:	/s/ Xxxx X. Xxxxxxxxx
	Name:	Xxxx X. Xxxxxxxxx
	Title:	Authorized Signatory

EXHIBIT A

Compliance Certificate

See attached.

EXHIBIT C TO FINANCING AGREEMENT

COMPLIANCE CERTIFICATE

Date: , 200

This Compliance Certificate (this “Certificate”) is given by BODY CENTRAL ACQUISITION CORP., a Delaware corporation, in its capacity as administrative borrower (in such capacity “Administrative Borrower”), pursuant to subsection 7.01(a)(iii) of that certain Financing Agreement dated as of October 1, 2006 among Administrative Borrower, the other Borrowers from time to time party thereto, each subsidiary of the Administrative Borrower listed as a “Guarantor” on the signature pages thereto, Dymas Funding Company, LLC, in its capacity as Administrative Agent, and the other financial institutions party thereto as “Lenders” (as such agreement may have been amended, restated, supplemented or otherwise modified from time to time, the “Financing Agreement”). Capitalized terms used herein without definition shall have the meanings set forth in the Financing Agreement.

The officer executing this Certificate is an Authorized Officer of Administrative Borrower and, as such, is duly authorized to execute and deliver this Certificate on behalf of Administrative Borrower. By executing this Certificate such Authorized Officer hereby certifies to Administrative Agent and Lenders that:

(a) the financial statements delivered with this Certificate in accordance with subsection 7.01(a)(i) and/or (ii), as applicable, of the Financing Agreement are correct and complete and fairly present in all material respects, and in accordance with GAAP, the financial position and the results of operations and cash flows of Parent and its Subsidiaries as of the dates of and for the periods covered by such financial statements in a manner consistent with that of the most recent audited financial statements (subject in the case of interim financial statements to normal year-end adjustments, the absence of footnote disclosures and accounting for lease leveling and tenant allowances);

(b) I have reviewed the provisions of the Financing Agreement and the other Loan Documents and have made or caused to be made under my supervision a review of the conditions and operations of the Parent and its Subsidiaries during the period covered by the financial statements delivered with this Certificate with a view to determining whether Parent and its Subsidiaries were in compliance with all of the provisions of the Financing Agreement and such Loan Documents at the times such compliance is required hereby and thereby, and such review has not disclosed, nor do I have knowledge of, the existence during such period of an Event of Default or Default or, if an Event of Default or Default existed, Exhibit. B attached hereto sets forth the nature and period of existence of such Event of Default or Default and the action which the Parent and its Subsidiaries propose to take or have taken with respect thereto;

(c) Exhibit A attached hereto is a correct calculation of each of the financial covenants contained in Section 7.03 of the Financing Agreement, calculated with respect to Parent and its Subsidiaries on a consolidated basis;

(d) Based on the Senior Leverage Ratio, the Applicable Margin for Base Rate Loans is and the Applicable Margin for LIBOR Loans is ; and

(e) Since the Closing Date and except as disclosed in prior Compliance Certificates delivered to Administrative Agent, none of Parent or any of its Subsidiaries has:

(i) changed its legal name, identity, jurisdiction of incorporation, organization or formation or organizational structure or formed or acquired any Subsidiary except as follows: ;

(ii) acquired the assets of, or merged or consolidated with or into, any Person, except as follows: ; and

(iii) changed its address or otherwise relocated, acquired fee simple title to any real property or entered into any real property leases, except as follows:

[Remainder of page intentionally left blank; signature page follows]

IN WITNESS WHEREOF, Administrative Borrower has caused this Certificate to be executed by one of its Authorized Officers this day of , 200 .

	BODY CENTRAL ACQUISITION CORP., a Delaware corporation


	By:
	Name:
	Title:

EXHIBIT A TO
COMPLIANCE CERTIFICATE

Note: All calculations set forth in this Certificate are for Parent and its Subsidiaries on a consolidated basis and are without duplication.

Covenant 7.03(a) — Senior Leverage Ratio

Senior Leverage Ratio is defined as Net Consolidated Senior Funded Indebtedness divided by Consolidated EBITDA and is calculated as follows:

Net Consolidated Senior Funded Indebtedness:

Average daily outstanding principal balance of Revolving Loans for the three month period (or such shorter period as shall have elapsed since the Closing Date) ended as of the date of measurement

Plus Outstanding principal balance of Term Loans as of the date of measurement

Principal portion of Capitalized Lease Obligations or Indebtedness secured by purchase money Liens as of the date of measurement

Without duplication, all other Indebtedness of the Parent and its Subsidiaries as of the date of measurement other than Indebtedness described in clauses (iv) and (vii) of the definition thereof

Equal: Gross Consolidated Senior Funded Indebtedness

Less: Subordinated Indebtedness included above Unrestricted cash on hand in excess of $3,000,000 in which Administrative Agent has a perfected first Lien *

Equal: Net Consolidated Senior Funded Indebtedness

Consolidated EBITDA (as calculated per Exhibit B)

Senior Leverage Ratio (Net Consolidated Senior Funded Indebtedness divided by Consolidated EBITDA)

* Notwithstanding anything to the contrary herein or in the Financing Agreement, unrestricted cash on hand in excess of $3,000,000 shall not be included in the calculation of Senior Leverage Ratio for testing periods in 2007.

Maximum Senior Leverage Ratio

In Compliance				Yes/No

Covenant 7.03(b) — Fixed Charge Coverage

Fixed Charge Coverage Ratio is defined as (Consolidated EBITDA less Unfinanced Capital Expenditures) divided by Fixed Charges and is calculated as follows:

Consolidated EBITDA (as calculated per Exhibit B)

Less: Unfinanced Capital Expenditures (as calculated per covenant 7.03(c) *

Equals: Consolidated Operating Cash Flow Fixed Charges:

Consolidated Net Interest Expense (as calculated per Exhibit C) for the applicable measurement period

Plus: All principal of Indebtedness scheduled to be paid or prepaid during the applicable measurement period

income taxes paid or payable in cash during the applicable measurement period

Restricted Payments paid in cash during the applicable measurement period, other than dividends or distributions paid by any Loan Party to a Borrower or a Wholly-Owned Subsidiary of a Borrower during such period; excluding, however, Restricted Payments in respect of the repurchase or redemption of Series C preferred stock up to an aggregate amount equal to the sum of $3,000,000 plus all accrued dividends on the Series C preferred stock through the date of such Restricted Payment

Management Fees (if any) paid in cash during the applicable measurement period

Equal: Fixed Charges**

Fixed Charge Coverage Ratio (Consolidated Operating Cash Flow divided by Fixed Charges)

Minimum Fixed Charge Coverage Ratio

In Compliance				Yes/No

* If any fiscal quarter set forth below is included in any period for which Fixed Charges are being calculated, the amount set forth below opposite such fiscal quarter shall be deemed to be Point of Sale Capital Expenditures for such fiscal quarter:

Fiscal Quarter Ended:	Amount:

March 31, 2007	$	250,000
June 30, 2007	$	250,000
September 30, 2007	$	1,250,000
December 31, 2007	$	1,250,000

** If any fiscal month set forth below is included in any period for which Fixed Charges are being calculated, the amount set forth below opposite such fiscal month shall be deemed to be Fixed Charges for such fiscal month:

Month	Amount

January, 2006	$	900,000
February, 2006	$	900,000
March, 2006	$	900,000
April, 2006	$	900,000
May, 2006	$	900,000
June, 2006	$	900,000
July, 2006	$	900,000
August, 2006	$	900,000
September, 2006	$	900,000

Covenant 7.03(c)
Capital Expenditure Limit

For purposes of Covenant 7.03(c), Capital Expenditures are calculated as follows:

The aggregate of all expenditures or obligations incurred by Parent and its Subsidiaries for the Fiscal Year (or shorter period) covered by the financial statements delivered with this Certificate, that, in accordance with GAAP, are or should be capitalized

Plus: To the extent not included above, the aggregate of all expenditures during such period to acquire by purchase or otherwise the business or fixed assets of, or the Capital Stock of, any Person

Total Capital Expenditures

Less: Net Cash Proceeds of Dispositions reinvested to the extent permitted by Section 2.05(C)(iii) and which are included in Total Capital Expenditures

Extraordinary Receipts consisting of proceeds of casualty insurance and/or condemnation awards reinvested to the extent permitted by Section 2.05(C)(v) and which are included in Total Capital Expenditures

The aggregate amount of contracted for tenant allowances

Capital Expenditures

(a) Portion of Capital Expenditures which constitute Point of Sale Capital Expenditures

(b) Potion of Capital Expenditures which constitute Capital Expenditures other than Point of Sale Capital Expenditures

Permitted Capital Expenditures

(a) Point of Sale Capital Expenditures (including carry forward of $ from prior Fiscal Year)

(b) Capital Expenditures other than Point of Sale Capital Expenditures (including carry forward of $ from prior Fiscal Year)

In Compliance for Point of Sale Capital Expenditures		Yes/No

In Compliance for Capital Expenditures other than Point of Sale Capital Expenditures

Yes/No

For purposes of calculating Fixed Charge Coverage Ratio, Unfinanced Capital Expenditures are defined as follows:

The aggregate of all expenditures or obligations incurred by Parent and its Subsidiaries for the twelve-month period ending on the last day of the most current month covered by the financial statements delivered with this Certificate, that, in accordance with GAAP, are or should be capitalized

Plus: To the extent not included above, the aggregate of all expenditures during such period to acquire by purchase or otherwise the business or fixed assets of, or the Capital Stock of, any Person

Total Capital Expenditures

Less: Net Cash Proceeds of Dispositions reinvested to the extent permitted by Section 2.05(C)(iii) and which are included in Total Capital Expenditures

Extraordinary Receipts consisting of proceeds of casualty insurance and/or condemnation awards reinvested to the extent permitted by Section 2.05(C)(v) and which are included in Total Capital Expenditures

The aggregate amount of contracted for tenant allowances

Capital Expenditures

Less: Portion of Capital Expenditures financed under Capitalized Leases or other Indebtedness (Indebtedness, for this purpose, does not include drawings under the Revolving Loan Commitment)

Less: $3,000,000 in the aggregate during testing periods in 2007

Unfinanced Capital Expenditures (used in calculation of Fixed Charge Coverage Ratio)

EXHIBIT B TO COMPLIANCE CERTIFICATE

Calculation of Consolidated EBITDA

Consolidated EBITDA is calculated as follows:

Net income (or loss) for the applicable period of measurement of Parent and its Subsidiaries on a consolidated basis determined in accordance with GAAP, but excluding: (a) the income (or loss) of any Person (other than a Subsidiary of the Parent) in which Borrower has an ownership interest except to the extent of the amount of dividends or other distributions actually paid to the Borrower or any of its Subsidiaries in cash by such Person during such period and the payment of dividends or similar distributions by that Subsidiary is not at the time prohibited by operation of the terms of its charter or of any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Subsidiary; (b) the income (or loss) of any Person accrued prior to the date it becomes a Subsidiary of the Borrower or is merged into or consolidated with the Borrower or any of its Subsidiaries or that Person’s assets are acquired by the Borrower or any of its Subsidiaries; (c) the proceeds of any life insurance policy; (d) gains or losses from the Disposition of property or assets not in the ordinary course of business of the Borrower and its Subsidiaries, and related tax effects in accordance with GAAP; and (e) any other non-recurring non-cash or extraordinary gains or losses of the Parent or its Subsidiaries, and related tax effects in accordance with GAAP

Plus, without duplication and to the extent deducted in determining net income (or loss) above:

interest expense, less interest income

income tax expense

depreciation expense

amortization expense

management fee to Sponsor pursuant to a management agreement entered into as permitted by the Financing Agreement

fees and expenses paid (i) on or about the Closing Date in connection with the Loan Documents or the Related Transaction Documents, to the extent such fees and expenses do not exceed $555,000 in the aggregate, and (ii) in connection with that certain Waiver and First Amendment to Financing Agreement to Administrative Agent

Non cash adjustments relating to lease leveling

Fees and expenses paid in connection with the internet security breach to the extent such fees and expenses do not exceed $130,000 in the aggregate

Consolidated EBITDA (used in calculating Senior Leverage Ratio and Fixed Charge Coverage Ratio)

EXHIBIT C TO
COMPLIANCE CERTIFICATE

Calculation of Consolidated Net Interest Expense

Gross interest expense during the applicable measurement period

Less: Interest income during the applicable measurement period

amortization of capitalized fees and expenses incurred in connection with the Related Transactions and included in gross interest expense

amortization of original issue discount included in gross interest expense

interest paid in kind or capitalized and included in gross interest expense

Consolidated Net Interest Expense (used in calculation of Fixed Charge Coverage Ratio)

Document Metadata

Table of Contents

WAIVER AND FIRST AMENDMENT TO FINANCING AGREEMENT

Document Metadata